CBM2015-00017
`United States Patent No. 8,061,598
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`____________
`
`APPLE INC.,
`Petitioner,
`
`v.
`
`SMARTFLASH LLC,
`Patent Owner.
`
`
`____________
`
`Case CBM2015-00017
`Patent 8,061,598
`
`____________
`
`
`CORRECTED PETITION FOR COVERED BUSINESS METHOD
`PATENT REVIEW OF UNITED STATES PATENT NO. 8,061,598
`PURSUANT TO 35 U.S.C. § 321, 37 C.F.R. § 42.3041
`
`
`
`
`
`
`
`
`1 As directed by the Board in Paper 7, Petitioner hereby resubmits this Petition to ad-
`
`dress formality issues identified therein.
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`
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`

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` CBM2015-00017
`United States Patent No. 8,061,598
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`
`TABLE OF CONTENTS
`
`B.
`
`C.
`
`3.
`4.
`
`5.
`
`INTRODUCTION ....................................................................................................... 1
`I.
`II. OVERVIEW OF FIELD OF THE CLAIMED INVENTION ......................... 6
`III. PETITIONER HAS STANDING .......................................................................... 11
`A.
`The ’598 Patent Is a Covered Business Method Patent ............................. 11
`1.
`Exemplary Claim 7 Is Financial In Nature ...................................... 11
`2.
`Claim 7 Does Not Cover A Technological Invention ................... 15
`Related Matters and Mandatory Notice Information; Petitioner Is a Real
`Party In Interest Sued for and Charged With Infringement ..................... 20
`IV. DETAILED EXPLANATION OF REASONS FOR RELIEF REQUESTED,
`SHOWING IT IS MORE LIKELY THAN NOT THAT AT LEAST ONE
`OF THE CHALLENGED CLAIMS IS UNPATENTABLE ............................ 21
`A.
`Claim Construction .......................................................................................... 22
`B.
`The Challenged Claims Are Unpatentable Under § 101 ............................ 26
`1.
`Claims Are Directed To Abstract Ideas ........................................... 27
`2.
`Claims Do Not Disclose An “Inventive Concept” That Is
`“Significantly More” Than an Abstract Idea ................................... 30
`Field Of Use Limitations Cannot Create Patent Eligibility ........... 31
`Generic Computer Implementation Cannot Transform
`Abstract Ideas Into Patent Eligible Inventions ............................... 31
`The Functional Nature Of The Challenged Claims
`Confirms preemption and Patent Ineligibility ................................. 36
`6. Machine-or-Transformation Test Also Confirms Patent
`Ineligibility ............................................................................................. 38
`The Challenged Claims Are Unpatentable Under § 103 ............................ 38
`1.
`Overview of Stefik ............................................................................... 38
`2. Motivation to Combine Stefik with Ahmad .................................... 42
`3. Motivation to Combine Stefik with Ahmad and Kopp ................. 43
`4.
`Claims 1, 2, 15, and 31 are Obvious in Light of Stefik in
`View of Ahmad (Ground 2); Claims 1, 2, 15, and 31 are
`Obvious in Light of Stefik in View of Ahmad and Kopp
`(Ground 3) ............................................................................................ 45
`CONCLUSION........................................................................................................... 74
`
`V.
`
`ii
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`

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`
`EXHIBIT LIST
`1201
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`1202
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`1203
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`1204
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`1205
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`1206
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`1207
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`1208
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`1209
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`1210
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`1211
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`1212
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`1213
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`1214
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`1215
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`1216
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`1217
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`1218
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`1219
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` CBM2015-00017
`United States Patent No. 8,061,598
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`U.S. Patent No. 8,061,598
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`Plaintiffs’ First Amended Complaint
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`U.S. Patent No. 5,925,127
`
`U.S. Patent No. 5,940,805
`
`Russell Housley and Jan Dolphin, “Metering: A Pre-pay
`Technique,” Storage and Retrieval for Image and Video Data-
`bases V, Conference Volume 3022, 527 (January 15, 1997)
`U.S. Patent No. 4,999,806
`
`U.S. Patent No. 5,675,734
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`U.S. Patent No. 4,878,245
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`U.S. Patent No. 7,334,720
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`U.S. Patent No. 7,942,317
`
`U.S. Patent No. 5,103,392
`
`U.S. Patent No. 5,530,235
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`U.S. Patent No. 5,629,980
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`U.S. Patent No. 5,915,019
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`European Patent Application, Publication No. EP0809221A2
`
`International Publication No. WO 99/43136
`
`JP Patent Application Publication No. H11-164058 (transla-
`tion)
`Eberhard von Faber, Robert Hammelrath, and Frank-Peter
`Heider, “The Secure Distribution of Digital Contents,” IEEE
`(1997)
`Declaration of Anthony J. Wechselberger In Support of Apple
`Inc.’s Petition for Covered Business Method Patent Review
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`
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`

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`United States Patent No. 8,061,598
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`EXHIBIT LIST
`1220
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`U.S. Patent No. 8,033,458
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`1221
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`1222
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`1223
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`1224
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`1225
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`1226
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`1227
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`Declaration of Michael P. Duffey In Support of Apple Inc.’s
`Petition for Covered Business Method Patent Review
`Declaration of Megan F. Raymond In Support of Apple Inc.’s
`Petition for Covered Business Method Patent Review
`Claim Construction Memorandum Opinion from Smartflash
`LLC v. Apple Inc., No. 6:13cv447 (Dkt. 229)
`File History for U.S. Patent No. 8,061,598
`
`U.S. Patent No. 4,337,483
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`U.S. Patent No. 7,725,375
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`International Publication No. WO 95/34857
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`ii
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`

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` CBM2015-00017
`United States Patent No. 8,061,598
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`I.
`
`INTRODUCTION
`
`Pursuant to § 321 and Rule § 42.304,2 the undersigned, on behalf of and acting
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`in a representative capacity for Apple Inc. (“Petitioner”), petitions for review under
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`the transitional program for covered business method (“CBM”) patents of claims 1, 2,
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`7, 15, and 31 of U.S. Pat. No. 8,061,598 (“the ’598 Patent” or “’598”), issued to
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`Smartflash Technologies Limited and assigned to Smartflash LLC (“Patentee”). Peti-
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`tioner asserts that it is more likely than not that the challenged claims are unpatentable,
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`and respectfully requests review of, and judgment against the challenged claims as un-
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`patentable under § 101, and claims 1, 2, 15, and 31 as unpatentable under § 103 as ob-
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`vious. As discussed in Section III.B, infra, Petitioner previously filed CBM2014-00108
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`and CBM2014-00109 seeking CBM review of the ’598 Patent on §§ 102 and 103
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`grounds. Those petitions were instituted for trial (and consolidated) with respect to
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`claim 26 on grounds based on § 103, but the Board did not institute trial on claims 1,
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`2, 7, 15, or 31. In its Institution Decision, the Board construed the term “use rule” as
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`“a rule specifying a condition under which access to content is permitted,” id. Pap. 8,
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`7, and determined that Petitioner had not shown it was more likely than not that it
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`would prevail in demonstrating that Stefik renders obvious “use rules” under the
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`2 Petitioner is demonstrating, in pending litigation, that these claims are invalid for
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`numerous additional reasons. All section cites herein are to 35 U.S.C. or 37 C.F.R., as
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`the context indicates, and all emphasis herein is added unless otherwise noted.
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`United States Patent No. 8,061,598
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`Board’s construction, id., 12-13, 17, and did not sufficiently explain why usage rights
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`in Stefik fall within examples of “use status data” in the specification of the ’598 Pa-
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`tent (e.g., past usage of stored data, that stored data has not been accessed, number of
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`times stored data has been accessed, duration of access of stored data), id., 13-15, 17.
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`In light of the Board’s Decision, Petitioner now identifies additional prior art—
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`Ahmad and Kopp (Exs.1203, 1204)—with explicit disclosures of “use rules” as con-
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`strued by the Board, and data that meets particular examples of “use status data” pro-
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`vided by the specification of the ’598 Patent. Ahmad, e.g., describes a software rental
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`system that monitors an elapsed time of use recorded by a timer or a number of uses
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`recorded by a counter and does not permit access to the rented software if a software
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`rental license has been exhausted (e.g., Ex.1203 2:62-3:18), while Kopp discloses
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`checking recorded utilization data and denying access to a data record if a licensed
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`extent of utilization has been exhausted (e.g., Ex.1204 6:41-47). Petitioner has also
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`identified additional disclosures in Stefik concerning these limitations of claims 2, 15,
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`and 31, further confirming a POSA3 would have found it entirely obvious and routine
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`3 All references to a person of ordinary skill in the art (“POSA”) refer to the
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`knowledge or understanding of a POSA as of October 25, 1999. A POSA would
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`have at least a B.S. in E.E., C.S. or a telecommunications-related field, and at least
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`three years of industry experience that included client-server data/information
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`distribution and management architectures. See Ex.1219 ¶31.
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`2
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`United States Patent No. 8,061,598
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`to implement the system disclosed by Stefik using the express and advantageous
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`teachings of Ahmad and Kopp detailed in Section IV.C.4., infra, and in Ex.1219 ¶¶48,
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`49, 51, 53, 60-68.
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`The challenged claims of the ’598 Patent merely recite steps and corresponding
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`systems well-known in the field of data storage and access, including use of a “porta-
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`ble data carrier.” Ex.1201 1:20-24, Abstract, claim 1. Claim 1, for example, recites
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`five rudimentary components of a portable data carrier (e.g., smart card)—(A) an in-
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`terface, (B and C) content data and use rule memory, (D) a program store storing
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`code implementable by a processor, and (E) a processor . . . for implementing code.
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`The recited code is similarly elementary, storing content data and a use rule in memory (F):
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`1. A portable data carrier comprising:
`[A] an interface for reading and writing data from and to the portable
`data carrier;
`[B] content data memory, coupled to the interface, for storing one or
`more content data items on the carrier;
`[C] use rule memory to store one or more use rules for said one or more
`content data items;
`[D] a program store storing code implementable by a processor;
`[E] 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,
`[F] 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
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`3
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`

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`memory.
`Ex.1201. And dependent claim 7, for instance, adds certain express financial
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`United States Patent No. 8,061,598
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`components to claim 1:
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`7. A portable data carrier as claimed in claim 1, further comprising
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`[G] payment data memory to store payment data and code to
`provide the payment data to a payment validation system.
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`Ex.1201. But at the time of the earliest claimed priority date, these simple elements
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`and their combination were all well known. The patent itself acknowledges that the
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`idea of providing access to data in exchange for a payment (e.g., purchase of music on
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`a CD) was well known at the time. E.g., Ex.1201 5:9-12 (“where the data carrier
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`stores, for example, music, the purchase outright option may be equivalent to the pur-
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`chase of a compact disc (CD), preferably with some form of content copy protection such
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`as digital watermarking”). The idea of purchasing digital data for payment was simi-
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`larly well known. See, e.g., Ex.1207. And, as shown herein, the prior art was teeming
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`with disclosures of this basic concept and its straightforward implementation. Further,
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`as its language makes clear, claim 1 involves no “technology” at all other than a “portable
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`data carrier” with an interface, non-volatile memory, and program store/processor—which the
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`patent itself concedes was well known and commonplace at the time. See e.g., Ex.1201
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`11:28-29 (“standard smart card”), 3:37, 4:7-13, 6:19-21, 11:27-44, 17:6-18:4, Figs. 2, 9.
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`The use rules of claim 1 “may be linked to payments made from the card to provide
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`payment options such as access to buy content data outright; [or] rental access . . .” Id.
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`4
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`

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`5:1-8. Thus, as the intrinsic record reflects, claim 1 recites nothing more than a sys-
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`United States Patent No. 8,061,598
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`tem for reading and writing data while restricting access to that data. Indeed, the ’598
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`Patent states that “[t]he physical embodiment of the system is not critical and a skilled
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`person will understand that the terminals, data processing systems and the like can all
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`take a variety of forms.” See, e.g., Ex.1201 Fig 1, 12:29-32. And the variations pre-
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`sented in the other challenged system claims add nothing that was not already well-
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`known. Dependent claim 7, for example,4 simply adds to claim 1 the ability to store
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`and provide payment data. Similarly, the challenged method claim, claim 31, relating
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`to “controlling access to content data,” recites nothing more than the steps imple-
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`mented by the portable data carrier that restrict access to data. See id. Fig. 13.
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`Indeed, as confirmed by the Supreme Court’s recent decision in Alice Corp. Pty,
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`Ltd. v. CLS Bank Int’l, 134 S. Ct. 2347 (2014)—decided after Petitioner’s original peti-
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`tions challenging the ’598 Patent were filed—the challenged claims are also directed to
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`patent-ineligible subject matter under § 101. As the Board noted in its previous Insti-
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`tution Decision, “the ’598 patent makes clear that the asserted novelty of the inven-
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`4 Claim 2 merely adds to claim 1 the well-known notion of providing access to data
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`based on a use rule. Claim 15 adds to claim 1 only the storage of a PIN number.
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`Claim 31 is a rudimentary method claim for “controlling aces to content data,” includ-
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`ing the steps of (a) “receiving a data access request . .”; (b) “reading the use status da-
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`ta”, (c) “evaluating the use status data . . .”; and (4) enabling access to the content . . .”
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`5
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`United States Patent No. 8,061,598
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`tion is not in any specific improvement of software or hardware, but in the method of
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`controlling access to data,” CBM2014-00108, Pap. 8, 10, and the challenged claims are di-
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`rected to nothing more than the unpatentable abstract idea of paying for and control-
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`ling access to data, with at most the addition of well-known, routine and conventional
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`features that do not render them patentable—in particular, generic computer imple-
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`mentation that cannot confer patentability on these patent-ineligible abstractions. E.g.,
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`Alice, 134 S. Ct. at 2359-60. Each challenged claim recites ineligible subject matter,
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`and claims 1, 2, 15, and 31 are obvious; thus each is unpatentable.
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`II. OVERVIEW OF FIELD OF THE CLAIMED INVENTION
`By October 25, 1999, electronic sale, distribution, and content protection for
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`digital products all would have been well-known to a POSA, and their combination as
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`claimed also would have been well-known or at minimum obvious to a POSA. See,
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`e.g., Ex.1219 Sec. V. In March 1991, for example, U.S. Pat. No. 4,999,806 issued, dis-
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`closing a system and method for sale and distribution of digital products (e.g., software)
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`by phone, and for content protection. See Ex.1206 Abstract (“A central station dis-
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`tributes software by telephone[,] accepts credit card information, transmits an ac-
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`ceptance code and then terminates the call. After verifying the credit card information, the
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`station calls the purchaser back and continues with the transaction only after receiving the acceptance
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`code.”); 1:67-2:9 (describing “means for selling and distributing protected software using stand-
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`ard telephone lines,” “permit[ting] the purchaser to rent the protected software for a period of time,”
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`United States Patent No. 8,061,598
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`and “rent[ing] the protected software for a specific number of runs”). Ex. 1206 thus discloses
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`making different types of access available, e.g., purchase vs. rental, with a Control
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`Transfer Program and Primary Protection Program that ensures the computer receiv-
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`ing a downloaded program does not have another program present that could create
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`unauthorized copies. See id. Abstract; 2:65-3:23; see also Ex.1219 ¶36.
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`In April 1992, U.S. Pat. No. 5,103,392 issued, disclosing storing information
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`about customer use of digital products so that a customer can be charged according to
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`its use, including “user-specific credit data storage means for storing data identifying the
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`user . . . and indicating credit for payment capacity, use time length, or the like of the user,” as
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`well as “[1] use decision means for determining permission to use the program . . . on the basis
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`of program-specific data supplied from the program storage means or user-specific credit data
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`supplied from the user-specific credit data storage means, the use decision means delivering
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`either an affirmative or negative signal corresponding to results of the decision[, and[2]] pro-
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`gram use history storage means connected to the use decision means for storing program use
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`history data.” See, e.g., Ex.1211 1:64-2:17. Ex. 1211’s emphasis on assuring permission
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`to access a program and compensation to providers for use of their programs under-
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`scores the art’s focus on digital rights management (“DRM”), over eight years before
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`the ’598 Patent’s claimed priority date. See also Ex.1219 ¶39.
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`Exhibit 1215 (“Poggio,” pub’d Nov. 26, 1997), gives another example of secure
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`distribution and protection, disclosing a “virtual vending machine” system for the sale
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`7
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`of digital products. See, e.g., id. Abstract (“A virtual vending machine manages a comprehen-
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`United States Patent No. 8,061,598
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`sive vending service for the distribution of licensed electronic data (i.e., products) over a distributed
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`computer system. . . . [and] distributes licenses for the electronic data for the complete product or for
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`components thereof and for a variety of time frames, including permanent licenses and rental period
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`licenses. [It] provides client computers with the capability to obtain information regarding
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`the available products and the associated license fees and rental periods, to receive the product upon
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`receipt of a corresponding electronic payment, and to reload the product during the term of the li-
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`cense.”). Poggio too discloses different types of product options, including rentals. See
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`also Ex.1219 ¶ 40.
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`Also in 1997, Exhibit 1218 observed that “[e]lectronic commerce systems dealing
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`with the distribution of digital contents like software or multimedia data have to couple
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`the use of the provided digital goods with a prior payment for the goods in a way which cannot be
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`bypassed” proposing a system where customers purchase keys required to utilize dis-
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`tributed encrypted content. E.g., id. at 7 (a “solution is to distribute the contents in encrypt-
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`ed form, and to have the customer pay for the key which he needs to transform the encrypted content in
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`an usable form. The security problem can in this way be transformed into a problem of
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`key distribution.”), 8 (“The Content Provider provides digital contents in encrypted form
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`being distributed by the Content Distributor. . . . The Authorisation System permits the distribu-
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`tion of the appropriate key after settling of the fees payable by the Customer, who will enjoy the
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`decrypted digital contents.”); Fig. 1. Ex. 1218 also states its system could be used for
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`United States Patent No. 8,061,598
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`a variety of known distribution and payment methods, and further addressed the
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`known issue of payment distribution to content providers. See, e.g., id. 13 (“Different
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`methods can be used to distribute the encrypted contents (standard techniques). . . . This includes
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`broadcasting, point-to-point networking, as well as offering disks. Different electronic payment meth-
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`ods can be integrated . . . . This flexibility leads to the fact that totally different authorisation meth-
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`ods can be integrated.”; “The system automatically divides the package price (payments) and guar-
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`antees that the money is transferred to each Content Provider . . . .”); see also Ex.1219 ¶¶ 41-43.
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`And U.S. Pat. No. 5,915,019 (“Ginter”), issued in June 1999, discloses “Sys-
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`tems and Methods for Secure Transaction Management and Electronic Rights Protection.” See,
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`e.g., Ex.1214 (filed January 8, 1997). Ginter discloses “systems and methods for se-
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`cure transaction management and electronic rights protection,” and describes a “vir-
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`tual distribution environment” (“VDE”) to “control and/or meter or otherwise moni-
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`tor use of electronically stored or disseminated information.” See, e.g., Ex.1214 Ab-
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`stract. Ginter’s system “help[s] to ensure that information is accessed and used only in au-
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`thorized ways, and maintain the integrity, availability, and/or confidentiality of the infor-
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`mation,” e.g., id., and discloses that “[a]ll participants of VDE 100 have the innate abil-
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`ity to participate in any role, highlighting the known flexibility in such distribution sys-
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`tems, underscoring that combinations between and among disclosures of such sys-
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`tems would have been obvious to a POSA, e.g., id. 255:22-43; see also Ex.1219 ¶¶ 44-45.
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`Conteng storage and utilization on portable devices, including mobile commu-
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`9
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`nication devices such as cellular phones, was also well-known before the claimed pri-
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`ority date. Exhibit 1216, pub’d Aug. 26, 1999), discloses a cell phone for storing and
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`accessing digital content. See, e.g., Ex.1216 5:7-13 (“Because of its integration into the cel-
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`lular phone, the digital entertainment module can share components already present in the cellular
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`phone. . . . [T]he use of solid state RAM or ROM, as opposed to disc storage, eliminates
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`the need for bounce control circuitry. This enables the disclosed invention to provide cellular
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`communications and entertainment . . . .”). See also Ex.1219 ¶ 46. And Exhibit 1218 (pub’d
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`June 18, 1999) discloses storing media content onto and playing the media content
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`from mobile user devices, and storing the media content on a removable IC card. E.g.,
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`Ex.1217 ¶ 9 (“portable music selection and viewing device 70 provides a removable stor-
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`age device 76 [which] is a memory card similar to, for example. . . an IC card… The user,
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`after downloading the music software to the storage device (medium) 76 of the porta-
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`ble music selection and viewing device 70 by operating the push buttons or the like on
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`the main body 71, can enjoy this music software on a display 72 or a receiver 74 of the
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`portable music selection and viewing device 70, and can also enjoy higher quality mu-
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`sic playback by removing this storage device (medium) and inserting it into another audio unit.
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`[T]he user can store the music software from another audio unit into the storage device 76 and en-
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`joy music by inserting this storage unit 76 into this portable . . . device 70.”); ¶ 13 (“A
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`music storage medium 250 such as a magnetic card, magnetic tape, a CD, a DVD, or a
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`memory card such as an IC card stores the music software . . . .”); see also Ex.1219 ¶47.
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`As this background and the additional examples detailed below in Section IV.C
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`illustrate, the prior art was rife with awareness and discussion of the same supposed
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`“invention” memorialized in the ’598’s challenged claims.
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`III. PETITIONER HAS STANDING
`A.
`The ’598 Patent is a “covered business method patent” under § 18(d)(1) of the
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`The ’598 Patent Is a Covered Business Method Patent
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`AIA and § 42.301, and Petitioner certifies it is available for review under § 42.304(a).
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`See also CBM2014-00108/109, Pap. 8, 7-12) (finding claim 7 satisfies requirement).
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`Although numerous claims of the ’598 Patent qualify, a patent with even one claim
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`covering a covered business method is considered a CBM patent. See CBM 2012-
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`00001, Pap. 36, 26; 77 Fed. Reg. 48,709 (Aug. 14, 2012). Petitioner thus addresses
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`here exemplary claim 7, which depends from claim 1 (both quoted above).
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`1.
`A CBM patent is “a patent that claims a method or corresponding apparatus for per-
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`Exemplary Claim 7 Is Financial In Nature
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`forming data processing or other operations used in the practice, administration, or management of a
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`financial product or service, except that the term does not include patents for technological
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`inventions.” AIA § 18(d)(1); 37 C.F.R. § 42.301. “[T]he definition of covered busi-
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`ness method patent was drafted to encompass patents claiming activities that are fi-
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`nancial in nature, incidental to a financial activity or complementary to a financial ac-
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`tivity.’” 77 Fed. Reg. 48,734, 48,735 (Aug. 14, 2012) (citing 157 Cong. Rec. S5432
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`(daily ed. Sept. 8, 2011) (statement of Sen. Schumer)). “[F]inancial product or ser-
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`vice” is to be interpreted broadly, id., and the term “financial . . . simply means relating to
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`monetary matters”—it does not require any link to traditional financial industries such as
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`banks. See, e.g., CBM2012-00001, Pap. 36, 23. The Board has previously found, e.g.,
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`that a claim for “transferring money electronically via a telecommunication line to the
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`first party . . . from the second party” met the financial product or service requirement,
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`concluding that “the electronic transfer of money is a financial activity, and allowing
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`such a transfer amounts to providing a financial service.” CBM2013-00020, Pap. 13,
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`11-15; see also, e.g., CBM2013-00017, Pap. 8, 5-6.
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`The ’598 patent includes claims directed to a “portable data carrier” (such as a
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`standard smart card) that stores content, use rules, payment data, and code that pro-
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`vides payment data to a payment validation system. See AIA § 18(d)(1); 37 C.F.R.
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`§ 42.301(a); Ex.1201. The ’598 patent alleges that this allows content owners to make
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`content available to users without fearing loss of revenue. Ex.1201 2:11-15; see also id.
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`claim 31 (“A method of controlling access to content data, the method comprising: receiv-
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`ing a data access request from a user for a content data item, reading the use status
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`data and one or more use rules from parameter memory that pertain to use of the re-
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`quested content data item; evaluating the use status data using the one or more use
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`rules to determine whether access to the content data item is permitted; and enabling
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`access to the content data item responsive to a determination that access to the con-
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`tent data item is permitted”). More generally, the patent is about “[d]ata storage and
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`United States Patent No. 8,061,598
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`access systems [that] enable downloading and paying for data . . .” Id. Abstract. “The
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`combination of payment data and stored content data and use rule data helps reduce
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`the risk of unauthorized access to data.” Id. And in seeking to enforce the ’598 pa-
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`tent in litigation, Smartflash itself conceded that the alleged invention relates to a fi-
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`nancial activity or transaction, stating that “[t]he patents-in-suit generally cover a port-
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`able data carrier for storing data and managing access to the data via payment infor-
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`mation and/or use status rules. The patents-in-suit also generally cover a computer
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`network . . . that serves data and manages access to data by, for example, validating
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`payment information.” Ex.1202 ¶ 17.
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`Indeed, the specification confirms the “portable data carrier” of the invention
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`is “for storing and paying for data,” Ex.1201 1:20-22, and the “use rules” of Claim 1
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`“may be linked to payments made from the card to provide payment options such as
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`access to buy content data outright; [or] rental access . . .” Id. 5:1-8. Claim 7 further
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`requires memory to store payment data and code to “provide the payment data to a
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`payment validation system.” Id. cl. 7. Thus Claim 7, which explicitly describes storing
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`and providing payment data to a payment validation system, clearly concerns a com-
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`puter system (corresponding to the methods discussed and claimed elsewhere) for
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`performing data processing and other operations used in the practice, administration,
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`or management of a financial activity and service. Indeed, claim 7 expressly recites
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`software (i.e., code) to perform data processing and other operations in connection
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`United States Patent No. 8,061,598
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`with the recited “payment validation system” (e.g., “to store payment data and code to
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`provide the payment data to a payment validation system”) and “rules for said one or
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`more content data items” (e.g., “a processor coupled to the content data memory, the
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`use rule memory, the interface and to the program store for implementing code in the
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`program store, wherein the code comprises code for storing at least one content data
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`item in the content data memory and at least one use rule in the use rule memory”).
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`The use rules, too, which may restrict access to content based on payments, further
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`indicate that independent Claim 1 also relates to a financial activity and providing a
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`financial service. See, e.g., id. 5:1-8; 8:31-33; 9:22-25; 14:65-15:4; claim 31 (“method of
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`controlling access to content data, the method comprising: receiving a data access re-
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`quest from a user for a content data item, reading the use status data and one or more use
`
`rules from parameter memory that pertain to use of the requested content data item; evaluating the
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`use status data using the one or more use rules to determine whether access to the content data
`
`item is permitted; and enabling access to the content data item responsive to a determination that ac-
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`cess to the content data item is permitted”); CBM2013-00020, Pap. 14, 9-10 (“the
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`electronic transfer of money is a financial activity, and allowing such a transfer
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`amounts to providing a financial service.”). See also AIA § 18(d)(1); 37 C.F.R.
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`§ 42.301(a). See also 77 Fed. Reg. 48,734, 48,735 (Aug. 14, 2012) (“[T]he definition of
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`[CBM] was drafted to encompass patents ‘claiming activities that are financial in na-
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`ture, incidental to a financial activity or complementary to a financial activity.’”) (cita-
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`14
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`tion omitted).5
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` CBM2015-00017
`United States Patent No. 8,061,598
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`2.
`Further, claim 7 (and claim 1, from which it depends) is not a “technological in-
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`Claim 7 Does Not Cover A Technological Invention
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`vention” that would trigger the exception in AIA § 18(d)(1), because it does not claim
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`“subject matter as a whole [that] recites a technological feature that is novel and un-
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`obvious over the prior art[] and solves a technical problem using a technical solution.”
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`§ 42.301(b). To the contrary, the ’598 patent itself makes clear that its claimed “port-
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`able data carrier” was a commonplace device that could be implemented using well-
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`known industry standards.
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`(a) Claim 7 Does Not Recite A Technological Feature
`That Is Novel and Unobvious
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`First, no “technological feature” of claim 7 is novel and unobvious. The PTO
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`has confirmed that “[m]ere recitation of known technologies, such as computer hardware, commu-
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`nication or computer networks, software, memory, computer-readable storage medium, scanners,
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`display devices or databases, or specialized machines, such as an ATM or point of sale
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`device,” or “[r]eciting the use of known prior art technology to accomplish a process or method,
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`even if that process or method is novel and non-obvious,” will “not typically render a patent a
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`technological invention.” E.g., 77 Fed. Reg. 48,756 48,764 (Aug. 14, 2012). The
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`PTAB has further stated that “combining prior art structures to achieve a normal, ex-
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`pected, or predictable result of that combination” does not render a patent a techno-
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`5 Claim 31 also relates to a financial activity based on the claimed use rules. Id.
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`15
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` CBM2015-00017
`United States Patent No. 8,061,598
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`logical invention. 77 Fed. Reg. 157 (Aug. 14, 2012) at 48764. Claim 7’s language
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`makes clear it involves no “technology” at all other than a “portable data carrier,” which
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`includes an interface, content data memory, use rule memory, a program store storing
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`code, a processor that implements the well-known steps disclosed in the specific