Case CBM2015-00028
`Patent 7,334,720 B2
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`UNITED STATES PATENT AND TRADEMARK OFFICE
`______________________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`______________________
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`APPLE INC.,
`Petitioner
`
`v.
`
`SMARTFLASH LLC,
`Patent Owner
`______________________
`
`Case CBM2015-00028
`Patent 7,334,720 B2
`______________________
`
`Before JENNIFER S. BISK, RAMA G. ELLURU, GREGG I. ANDERSON, and
`MATTHEW R. CLEMENTS, Administrative Patent Judges.
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`
`PETITIONER’S REPLY TO PATENT OWNER’S RESPONSE
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`Case CBM2015-00028
`Patent 7,334,720 B2
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`TABLE OF CONTENTS
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`I. 
`INTRODUCTION ........................................................................................... 1 
`PETITIONER’S RESPONSE TO PO’S STATEMENT OF FACTS ............. 3 
`II. 
`III.  THE CHALLENGED CLAIMS ARE NOT § 101 PATENT ELIGIBLE ..... 3 
`A.  PO Fails to Identify any Inventive Concept ............................................... 4 
`B.  The DDR Claims Are Not Analogous to the Claims ................................. 7 
`1. 
`The Claims Do Not Address an Internet-Specific Problem ............. 8 
`2. 
`The Claims Do Not “Override” Routine and Conventional
`Computer Action ............................................................................ 11 
`The Claims Here and in DDR Are Not Comparable...................... 13 
`3. 
`C.  PO’s Preemption Arguments Are Misplaced ........................................... 14 
`IV.  PO’S OTHER ARGUMENTS ARE IRRELEVANT TO THE MERITS .... 17 
`A.  Mr. Wechselberger Was Not Required to Recite an “Evidentiary
`Standard” or a “Standard for Statutory Subject Matter” .......................... 17 
`B.  PO’s Construction of “Payment Data” Ignores the Explicit Teachings
`of the ’720 Patent ...................................................................................... 21 
`C.  PO’s “Estoppel” Arguments Are Unfounded ........................................... 22 
`1. 
`Neither the ’720 Patent’s Prosecution Nor the AIA Prohibits
`the Board from Considering § 101 Here ........................................ 22 
`Non-Final § 101 Determinations in District Court Litigation
`Have No Impact On This Proceeding ............................................ 23 
`D.  Covered Business Method Reviews Are Constitutional .......................... 24 
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`2. 
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`Case CBM2015-00028
`Patent 7,334,720 B2
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`TABLE OF AUTHORITIES
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`CASES
`Accenture Global Servs., GmbH v. Guidewire Software, Inc.,
`728 F.3d 1336 (Fed. Cir. 2013) ................................................................ 5, 13, 24
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`Page(s)
`
`Alice Corp. Pty. Ltd. v. CLS Bank Int’l,
`134 S. Ct. 2347 (2014) .................................................................................passim
`
`Ariosa Diagnostics, Inc. v. Sequenom, Inc.,
`788 F.3d 1371 (Fed. Cir. 2015) ...................................................................passim
`
`Arrhythmia Research Tech., Inc. v. Corazonix Corp.,
`958 F.2d 1053 (Fed. Cir. 1992) .......................................................................... 24
`
`Bancorp Servs., L.L.C. v. Sun Life Assurance Co. of Can.,
`687 F.3d 1266 (Fed. Cir. 2012) ................................................................ 4, 13, 16
`
`buySAFE, Inc. v. Google, Inc.,
`765 F.3d 1350-52 (Fed. Cir. 2014) ........................................................... 5, 11, 13
`
`Content Extraction & Transmission LLC v. Wells Fargo Bank, Nat’l Ass’n,
`776 F.3d 1343 (Fed. Cir. 2014) .............................................................. 1, 4, 5, 13
`
`DDR Holdings, LLC v. Hotels.com, L.P.,
`773 F.3d 1245 (Fed. Cir. 2014) ...................................................................passim
`
`Digitech Image Techs., LLC v. Elecs. For Imaging, Inc.,
`758 F.3d 1344 (Fed. Cir. 2014) ............................................................................ 6
`
`Enzo Biochem, Inc. v. Gen-Probe, Inc.,
`424 F.3d 1276 (Fed. Cir. 2005) .......................................................................... 21
`
`Ethicon, Inc. v. Quigg,
`849 F.2d 1422 (Fed. Cir. 1988) .......................................................................... 24
`
`Fresenius USA, Inc. v. Baxter Int’l, Inc.,
`721 F.3d 1330 (Fed. Cir. 2013) .......................................................................... 23
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`Case CBM2015-00028
`Patent 7,334,720 B2
`Gottschalk v. Benson,
`409 U.S. 63 (1972) .......................................................................................... 1, 10
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`Intellectual Ventures I LLC v. Capital One Bank (USA)
`(“IV”), 792 F.3d 1363 (Fed. Cir. 2015) .............................................. 1, 10, 11, 12
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`Joy Techs., Inc. v. Manbeck,
`959 F.2d 226 (Fed. Cir. 1992) ............................................................................ 25
`
`Mayo Collaborative Servs. v. Prometheus Labs, Inc.,
`132 S. Ct. 1289 (2012) .................................................................................passim
`
`McCormick Harvesting Mach. Co. v. C. Aultman & Co.,
`169 U.S. 606 (1898) ............................................................................................ 25
`
`OIP Techs., Inc. v. Amazon.com, Inc.,
`788 F.3d 1359 (Fed. Cir. 2015) ...................................................................passim
`
`Patlex Corp. v. Mossinghoff,
`758 F.2d 594 (Fed. Cir. 1985) ............................................................................ 25
`
`SmartGene, Inc. v. Adv. Biological Labs., SA,
`555 F. App’x 950 (Fed. Cir. 2014) ....................................................................... 6
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`Suffolk Techs., LLC v. AOL Inc.,
`752 F.3d 1358 (Fed. Cir. 2014) .......................................................................... 21
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`Ultramercial, Inc. v. Hulu, LLC,
`772 F.3d 709 (Fed. Cir. 2014) .....................................................................passim
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`Versata Dev. Grp., Inc. v. SAP Am., Inc.,
`793 F.3d 1306 (Fed. Cir. 2015) .............................................................. 20, 22, 23
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`PTAB RULINGS
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`CBM2012-00007, Papers 15 & 58........................................................................... 24
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`CBM2013-00013, Paper 61 ....................................................................................... 6
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`CBM2014-00079, Paper 28 ................................................................................. 2, 15
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`CBM2014-00102, Paper 52 ............................................................................... 18, 21
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`CBM2015-00015, Paper 28 ..................................................................................... 16
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`Patent 7,334,720 B2
`CBM2015-00015, Paper 33 ..................................................................................... 13
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`CBM2015-00016, Paper 33 ..................................................................................... 13
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`CBM2015-00059, Paper 13 ................................................................................. 2, 15
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`IPR2013-00048, Paper 15 ........................................................................................ 21
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`IPR2013-00172, Paper 50 .................................................................................... 3, 18
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`STATUTES AND REGULATIONS
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`35 U.S.C. § 101 .................................................................................................passim
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`35 U.S.C. § 145 ........................................................................................................ 25
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`35 U.S.C. § 282(b) ................................................................................................... 22
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`35 U.S.C. § 324(a) ................................................................................................... 23
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`37 C.F.R. § 42.65 ..................................................................................................... 18
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`Case CBM2015-00028
`Patent 7,334,720 B2
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`LIST OF EXHIBITS
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`EXHIBIT LIST
`1201
`U.S. Patent No. 7,334,720
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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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`Plaintiffs’ First Amended Complaint
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`U.S. Patent No. 5,925,127
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`U.S. Patent No. 5,940,805
`Russell Housley and Jan Dolphin, “Metering: A Pre-pay Tech-
`nique,” Storage and Retrieval for Image and Video Databases V,
`Conference Volume 3022, 527 (January 15, 1997)
`U.S. Patent No. 4,999,806
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`U.S. Patent No. 5,675,734
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`U.S. Patent No. 4,878,245
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`File History for U.S. Patent No. 7,334,720
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`U.S. Patent No. 7,942,317
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`U.S. Patent No. 5,103,392
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`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
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`International Application Publication No. WO 99/43136
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`JP Patent Application Publication No. H11-164058 (translation)
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`Eberhard von Faber, Robert Hammelrath, and Franz-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
`v
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`1221
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`Case CBM2015-00028
`Patent 7,334,720 B2
`EXHIBIT LIST
`1220
`U.S. Patent No. 8,033,458
`Declaration of Michael P. Duffey In Support of Apple Inc.’s Peti-
`tion for Covered Business Method Patent Review
`Declaration of Megan F. Raymond In Support of Apple Inc.’s Peti-
`tion for Covered Business Method Patent Review
`Claim Construction Memorandum Opinion from Smartflash LLC v.
`Apple Inc., No. 6:13-cv-447 (Dkt. 229)
`File History for U.S. Patent No. 8,061,598
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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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`1228
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`1229
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`1230
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`1231
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`1232
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`1233
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`1234
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`1235
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`1236
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`1237
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`1238
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`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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`JP Patent Application Publication No. H10-269289 (translation)
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`File History for U.S. Patent No. 7,942,317
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`File History for U.S. Patent No. 8,033,458
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`U.S. Patent No. 8,061,598
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`U.S. Patent No. 8,118,221
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`File History for U.S. Patent No. 8,118,221
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`U.S. Patent No. 8,336,772
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`File History for U.S. Patent No. 8,336,772
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`U.S. Patent No. 5,646,992
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`Excerpts from the Deposition Transcript of Jonathan Katz, Ph.D.
`Vol. 1, April 8, 2015, taken in connection with CBM2014-
`00102, -00106, -00108, and 00112
`Smartflash LLC, et al. v. Apple Inc., et al., No. 6:13-cv-447, Dkt.
`585, Order (E.D. Tex. July 8, 2015)
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`Case CBM2015-00028
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`EXHIBIT LIST
`U.S. Patent No. 8,083,137
`1239
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`1240
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`1241
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`1242
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`U.S. Patent No. 7,603,382
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`U.S. Patent No. 7,970,713
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`Declaration of Michael P. Duffey In Support of Petitioner’s Reply
`to Patent Owner’s Response
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`GLOSSARY OF ABBREVIATIONS
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`
`Description
`Shorthand
`’720 Patent or ’720 United States Patent No. 7,334,720
`§ 101
`35 U.S.C. § 101
`BRI
`Broadest Reasonable Interpretation
`Petition or P
`Case CBM2015-00028 Corrected Petition, Paper 5
`Decision or Dec
`Case CBM2015-00028 Institution Decision, Paper 11
`PO
`Patent Owner
`POSITA
`Person of ordinary skill in the art
`Response or R
`Case CBM 2015-00028 Patent Owner Response, Paper 23
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`Case CBM2015-00028
`Patent 7,334,720 B2
`I.
`INTRODUCTION
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`PO does not dispute that claims 1 and 2 of the ’720 (the “Claims”) are di-
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`rected to an abstract idea under step 1 of the patent-eligibility test in Mayo Collab-
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`orative Servs. v. Prometheus Labs, Inc., 132 S. Ct. 1289, 1296-97 (2012) and Alice
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`Corp. Pty. Ltd. v. CLS Bank Int’l, 134 S. Ct. 2347, 2355 (2014). PO argues only
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`that the Claims have an “inventive concept” sufficient to satisfy step 2. But PO
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`does not identify even one inventive concept, let alone one “‘sufficient to ensure
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`that the patent … amounts to significantly more than a patent upon the [ineligible
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`concept] itself.’” Alice, 134 S. Ct. at 2355 (quoting Mayo, 132 S. Ct. at 1294).
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`Instead, in an effort to circumvent Mayo’s two-step analysis, PO relies ex-
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`clusively on conclusory attorney argument that the invention involves a computer-
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`related problem and solution, and erroneously analogizes the Claims to those in
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`DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245, 1255-59 (Fed. Cir. 2014).
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`And while the DDR claims are entirely distinguishable, PO ignores important case
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`law finding claims similar to the Claims to be patent ineligible. See, e.g., Alice, 134
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`S. Ct. 2347; Gottschalk v. Benson, 409 U.S. 63 (1972); Ultramercial, Inc. v. Hulu,
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`LLC, 772 F.3d 709 (Fed. Cir. 2014); Content Extraction & Transmission LLC v.
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`Wells Fargo Bank, Nat’l Ass’n, 776 F.3d 1343 (Fed. Cir. 2014); OIP Techs., Inc. v.
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`Amazon.com, Inc., 788 F.3d 1359 (Fed. Cir. 2015); Intellectual Ventures I LLC v.
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`Capital One Bank (USA) (“IV”), 792 F.3d 1363 (Fed. Cir. 2015). And, in any case,
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`DDR does not allow PO to circumvent the two-step Mayo inquiry.
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`PO also misapplies the preemption concern underlying § 101. PO incorrectly
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`argues that, separate from the two-step Mayo inquiry, the Claims are patent eligible
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`because they do “not result in inappropriate preemption.” R22-28. This same ar-
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`gument—contradicted by Mayo in language PO fails to mention—has been con-
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`sidered and rejected in recent decisions, which PO also entirely ignores. See, e.g.,
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`Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir. 2015);
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`OIP, 788 F.3d at 1362-63. Indeed, preemption is not an alternative or addition to
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`the Mayo test, but rather the underlying “concern that drives” that same inquiry.
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`Alice, 134 S. Ct. at 2354. The Mayo two-step test acts as a “proxy” for making
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`judgments about how much future innovation is preempted. Mayo, 132 S. Ct. at
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`1303. Indeed, the Board has correctly recognized, “questions on preemption are
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`inherent in and resolved by the § 101 analysis,” and “[w]here a patent’s claims are
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`deemed only to disclose patent ineligible subject matter under the Mayo framework
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`... preemption concerns are fully addressed and made moot.” Ariosa, 788 F.3d at
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`1379 1 ; CBM2015-00059, Pap.13 at 5 (discussing Ariosa); CBM2014-00079,
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`Pap.28 at 19. Thus, the extent of non-infringing alternatives is irrelevant, as ineli-
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`gible subject matter is not rendered patentable by the existence of non-infringing
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`alternatives. E.g., Ariosa, 788 F.3d at 1379; OIP, 788 F.3d at 1362-63.
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`1 Emphases herein added unless otherwise indicated.
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`Finally, PO’s arguments about claim construction, the weight to accord Peti-
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`tioner’s unrebutted expert opinions, the Board’s authority to review the Claims,
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`and the constitutionality of CBMs are legally incorrect and irrelevant.
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`II.
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`PETITIONER’S RESPONSE TO PO’S STATEMENT OF FACTS
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`As to PO’s alleged facts (1) and (2), Petitioner admits that the phrases “pre-
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`ponderance of the evidence” and “more likely than not” do not appear in Mr.
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`Wechselberger’s declaration. The evidentiary standard need not be recited in ex-
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`pert declarations. See, e.g., IPR2013-00172, Pap.50 at 42. Petitioner otherwise de-
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`nies these allegations. Petitioner further states the following material fact: PO did
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`not submit any expert opinion in this proceeding.
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`III. THE CHALLENGED CLAIMS ARE NOT § 101 PATENT ELIGIBLE
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`PO does not dispute that the Claims are directed to an abstract idea under
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`Mayo step 1. Cf. R19-20.2 Thus, the only remaining question is whether, under
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`2 See also Dec11-12 (“[T]he heart of the claimed subject matter is restricting ac-
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`cess to stored data based on supplier-defined access rules and validation of pay-
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`ment.”); Ex.2049 17-18 (“The asserted claims recite abstract ideas ... for control-
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`ling access to content data, such as various types of multimedia files, and receiving
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`and validating payment data. ... [C]onditioning and controlling access to data based
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`on payment—is abstract and a fundamental building block of the economy in the
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`digital age.”); Ex.2050 1-2; Ex.2076 18:5-21, 20:25-21:9, 86:15-87:7, 91:8-11,
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`Patent 7,334,720 B2
`Mayo step 2, the Claims include “additional features” amounting to an “inventive
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`concept” that is “significantly more” than the claimed abstract idea. Alice, 134 S.
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`Ct. at 2355, 2357. “[I]mplement[ing] the abstract idea with ‘routine, conventional
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`activit[ies],’ ... is insufficient to transform the patent-ineligible abstract idea into
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`patent-eligible subject matter.” Ultramercial, 772 F.3d at 716 (quoting Mayo, 132
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`S. Ct. at 1298). Indeed, “[t]here is no ‘inventive concept’ in [the] use of a generic
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`... computer to perform well-understood, routine, and conventional activities com-
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`monly used in industry.” Content Extraction, 776 F.3d at 1348 (citing Alice, 134 S.
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`Ct. at 2359); see also Bancorp Servs., L.L.C. v. Sun Life Assurance Co. of Can.,
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`687 F.3d 1266, 1278-80 (Fed. Cir. 2012). As discussed below, the Claims recite
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`only well-known, routine, and conventional computer activities.
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`A.
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`PO Fails to Identify any Inventive Concept
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`PO fails to identify any “inventive concept” in the Claims in its brief discus-
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`sion of Mayo step 2. PO describes the claims as directed to “transmitting requested
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`data content to the requester after evaluating use status data using use rules [which,
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`for Cl. 2, are dependent on payment data stored on the data carrier] to determine
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`whether access to the requested data content is permitted.” R20-21. But simply
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`transmitting data, storing data in a conventional data carrier, accessing data, and
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`92:25-93:7; cf. Pap.12 at 3 (arguments not raised in response are waived); Ex.2068
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`11:16-12:7, 65:16-66:20, 67:1-68:20, 69:8-70:5.
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`evaluating rules are all well-understood, routine, conventional computer activi-
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`ties—not inventive concepts. Ex.1219 ¶¶87-99. Indeed, unpatentable claims in Al-
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`ice similarly recited limitations for sending/receiving data, storing multiple types
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`of information, and ensuring that valuation rules were met. See, e.g., P33-35;
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`Ex.1226 cl. 26; Ex.1219 ¶¶87-99; Alice, 134 S. Ct. at 2352 nn.1-2 (rep. cl. 33),
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`2360 (no inventive concept in reciting generic computer components; “[n]early
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`every computer ... [is] capable of performing [] basic calculation, storage, and
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`transmission functions”); Content Extraction, 776 F.3d at 1345 (rep. cl. 1), 1347-
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`49 (no inventive concept in collecting, recognizing, and storing data); Ultramer-
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`cial, 772 F.3d at 712 (rep. cl. 1), 715-16 (“selecting an ad,” “restricting public ac-
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`cess,” “facilitating display,” “allowing the consumer access,” “updating the activi-
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`ty log,” and “receiving payment,” add no inventive concept; “that the system is ac-
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`tive ... and restricts public access also represents only insignificant pre-solution ac-
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`tivity”) (internal quotations omitted); buySAFE, Inc. v. Google, Inc., 765 F.3d
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`1350-52, 1355 (Fed. Cir. 2014) (no inventive concept in reciting generic computer
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`functionality (rep. cls. 1, 14); “a computer [that] receives and sends [] information
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`over a network ... is not even arguably inventive”); Accenture Global Servs.,
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`GmbH v. Guidewire Software, Inc., 728 F.3d 1336, 1338, 1344-46 (Fed. Cir. 2013)
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`(claims (rep. cl. 1) reciting only “generalized software components” for “generat-
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`ing tasks [based on] rules ... to be completed upon the occurrence of an event” un-
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`patentable); CBM2013-00013, Pap.61 at 8, 16 (claims (rep. cl. 1) reciting “an ab-
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`stract method, i.e., performing a real-time Web transaction,” including “transfer-
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`ring funds (i.e., debiting or crediting) in response to user signals from an input de-
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`vice” unpatentable); Digitech Image Techs., LLC v. Elecs. For Imaging, Inc., 758
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`F.3d 1344, 1351 (Fed. Cir. 2014) (generating and combining two data sets into a
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`device profile is ineligible); SmartGene, Inc. v. Adv. Biological Labs., SA, 555 F.
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`App’x 950, 955 (Fed. Cir. 2014) (“claim does not purport to identify new computer
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`hardware: it assumes the availability of physical components for input, memory,
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`look-up, comparison, and output.”).
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`The Claims recite no more than generic computer elements and functions
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`that were well-known, routine, and conventional to a POSITA at the time of filing.
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`See, e.g., Ex.1219 ¶¶87-99; P31-35; Ex.2076 145:7-147:14, 148:15-149:22,
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`154:10-155:9, 161:8-23, 175:25-178:9, 180:9-21, 181:19-183:11, 192:1-6; Ex.1201
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`3:64-65, 16:62-65, 18:26-30; cf. also Ex.2076 22:3-16, 36:5-24, 50:12-51:4, 100:1-
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`22, 103:15-104:18, 135:14-137:19, 142:4-24; Ex.2068 14:17-15:1, 69:8-70:5, 77:7-
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`18, 78:6-11, 87:19-88:11, 96:6-18, 96:25-98:24, 99:7-23, 100:6-101:8. PO has
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`submitted no contrary evidence. “[M]ere recitation of a generic computer cannot
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`transform a patent-ineligible abstract idea into a patent-eligible invention.” Alice,
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`134 S. Ct. at 2358. See also P29-35.3
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`3 PO’s’720 “Overview” (R15-18) discusses, e.g., a user “select[ing] content to pur-
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`Patent 7,334,720 B2
`B.
`The DDR Claims Are Not Analogous to the Claims
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`PO’s entire argument regarding step 2 of the Mayo analysis rests on its
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`flawed assumption that the Claims are patent eligible because PO alleges they re-
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`semble the claims in DDR. To begin with, DDR does not overturn the two-step in-
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`quiry required by Mayo. If the Claims are directed to an abstract idea (they are),
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`and if there is no “inventive concept” in the claims “sufficient to ensure that the pa-
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`tent in practice amounts to significantly more than a patent upon the [ineligible
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`concept] itself” (there is none), then the claims are patent ineligible. PO does not
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`dispute that the claims are directed to an abstract idea under step 1, and has provid-
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`ed no evidence of any “inventive concept” under step 2. That is dispositive. Super-
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`ficial comparisons to the claims in DDR cannot substitute for the Mayo two-step
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`inquiry. In any case, the DDR claims are not analogous, and the Claims are much
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`more similar to claims found patent ineligible.
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`The patent in DDR addressed the problem of retaining website visitors when
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`chase or rent from a variety of different content providers,” “transmit[ting] stored
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`‘payment data’ to a ‘payment validation system,’” “validat[ing] the payment data,”
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`“retriev[ing] the purchased content from the content provider,” and “track[ing] a
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`use of [content] such that a system could limit its playback to [sic] number of times
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`(e.g., three times) or determine that the [content] had only been partially used.”
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`R15-18. But none of these is tied to or recited in the Claims.
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`clicking on an advertisement within the host’s website. See 773 F.3d at 1257. Un-
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`
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`
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`der the conventional Internet function, clicking an advertisement hyperlink would
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`transport a website visitor away to, e.g., a third-party advertiser’s website. Id. The
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`patented claims provided a solution where the visitor is no longer transported to the
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`third-party website, but, instead, an outsource provider automatically generates a
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`hybrid web page combining visual “look and feel” elements from the host website
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`and product information from the third-party website. Id. This allows the host web-
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`site to retain the visitors but still enables visitors to purchase the product from the
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`third-party. Id. at 1257-58. The court distinguished this Internet-centric problem by
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`stating this practice “introduces a problem that does not arise in the ‘brick and
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`mortar’ context” as “[t]here is ... no possibility that by walking up to [a kiosk in a
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`warehouse store], the customer will be suddenly and completely transported out-
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`side the warehouse store and relocated to a separate physical venue associated with
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`the third-party.” Id. at 1258. Specifically, the court found the claimed method
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`“overrides the routine and conventional sequence of events ordinarily triggered by”
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`routine and conventional computer action and is not directed to the general abstract
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`idea of “‘use of the Internet’ to perform an abstract business practice (with insig-
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`nificant added activity).” Id. In contrast, the Claims do not address an Internet-
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`specific problem, nor do they override routine and conventional processes.
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`1.
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`The Claims Do Not Address an Internet-Specific Problem
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`PO incorrectly argues the Claims are like those in DDR because they alleg-
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`
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`edly address a “technological problem,” are rooted in computer technology, and
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`are directed to a challenge particular to the Internet/computer networks. R20-22.
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`But, “data piracy”—the business problem the ’720 addresses—is not a technologi-
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`cal problem or a “problem specifically arising in the realm of computer networks.”
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`See, e.g., Ex.1219 ¶¶84-85; Ex.2076 158:2-159:9; Dec8-10; cf. also Ex.2068
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`15:17-16:5, 25:3-16, 76:10-77:6. Indeed, unlike the DDR claims, which addressed
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`“a problem that does not arise in the ‘brick and mortar’ context,” PO’s Claims ad-
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`dress a problem of controlling access based on payment or rules—an age-old busi-
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`ness problem long solved outside the context of the Internet, such as in apartment
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`rentals, movie rentals, movie tickets, subscription plans, and pay-per-view pro-
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`gramming. See, e.g., Ex.1219 ¶¶33, 84-85; see also, e.g., Ex.1208 Abstract, 4:27-
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`35 (pay-per-use cable system); cf. also Ex.2068 42:11-43:15. Thus, that data piracy
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`(and providing access to goods based on rules/payment) may also exist on the In-
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`ternet does not render it a “‘challenge particular to the Internet’” (R21 (quoting
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`DDR, 773 F.3d at 1257)). See, e.g., Ultramercial, 772 F.3d at 716 (“Narrowing the
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`abstract idea of using advertising as a currency to the Internet is an ‘attempt[] to
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`limit the use’ of the abstract idea ‘to a particular technological environment,’
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`which is insufficient to save a claim.” (quoting Alice, 134 S. Ct. at 2358)). Thus,
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`the Claims are not analogous to DDR, where “the claimed solution [was] necessari-
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`ly rooted in computer technology in order to overcome a problem specifically aris-
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`ing in the realm of computer networks.” DDR, 773 F.3d at 1257. And, even if the
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`Claims’ only practical application is use with a computer, that would not render the
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`claim patent eligible. See, e.g., Benson, 409 U.S. at 71-74 (cls. 8 and 13 ineligible
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`despite “no substantial practical application except in connection with a digital
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`computer”). Regardless, because the claims here “do not address problems unique
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`to the Internet ... DDR has no applicability.” IV, 792 F.3d at 1371.
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`Further, it is undisputed that the data piracy problem exists outside the con-
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`text of the Internet/computer networks in the context of, e.g., content copy protec-
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`tion with digital watermarking. See Ex.1201 5:4-7 (“where the data carrier stores ...
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`music, the purchase outright option may be equivalent to the purchase of a com-
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`pact disc (CD), preferably with some form of content copy protection such as digi-
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`tal watermarking”). Similarly, video on demand was used to prevent video data pi-
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`racy (copying and misuse), time-limited promotional trials were used to prevent
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`software data piracy (including in the prior art Poggio), and region codes and en-
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`cryptions were used to DVD prevent piracy well before the ’720 priority date. See
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`Ex.1219 ¶85; see also, e.g., Ex.1215 1:13-23 (discussing purchasing “try and buy”
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`software in a store). Thus, the business problem and purported solution addressed
`
`by the Claims are more like those claims held patent ineligible, despite their ap-
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`plicability to the Internet. E.g., Ultramercial, 772 F.3d at 715-16 (using advertising
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`as currency on Internet); buySAFE, 765 F.3d at 1355 (creating transaction perfor-
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`
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`
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`mance guaranty on Internet); IV, 792 F.3d at 1367-71 (tracking financial transac-
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`tions and tailoring advertisements on Internet).
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`2.
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`The Claims Do Not “Override” Routine and Conventional
`Computer Action
`
`Contrary to PO’s assertion (R20-22), and unlike the DDR claims, the Claims
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`do not “override” routine and conventional computer action, and thus remain ineli-
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`gible. See DDR, 773 F.3d at 1258; id. at 1256 (“[A]fter Alice, there can remain no
`
`doubt: recitation of generic computer limitations does not make an otherwise ineli-
`
`gible claim patent-eligible.”). As the ’720 itself acknowledges, the Claims simply
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`recite computer-based limitations acting in a routine and conventional manner,
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`e.g., a data carrier that may be a generic device such as a “standard smart card,”
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`Ex.1201 11:37-40, and content memory and parameter memory that may be con-
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`ventional non-volatile memories, such as “optic, magnetic or semiconductor
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`memory, ... [or] Flash memory,” id. 6:17-19, Fig.9. See also id. 3:64-65, 16:62-65,
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`18:26-30 (describing components as “conventional”); P31-35. Further, the method
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`Claims perform generic computer functions, such as reading, receiving, evaluating,
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`displaying, and selecting. See, e.g., supra Section III.A. The Claims do not over-
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`ride routine and conventional computer actions—they claim such actions, and are
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`patent ineligible.
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`Indeed, the Claims are analogous to numerous claims held unpatentable. For
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`example, the patent-ineligible claims in IV recited “generic computer elements”
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`
`
`
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`(e.g., “a database, a user profile,” “a communication medium”) and steps (e.g.,
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`“storing” data (i.e., user profile) in the database, “causing communication” be-
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`tween database and “receiving device,” employing “interactive interface” that was
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`simply “a generic web server with attendant software, tasked with providing web
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`pages to and communicating with the user’s computer”) “that d[id] nothing more
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`than spell out what it means to ‘apply it on a computer.’” 792 F.3d at 1366-71 (an-
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`alyzing Pat. Nos. 8,083,137 (Ex.1239) and 7,603,382 (Ex.1240)). The claims in IV
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`were distinguishable from the DDR claims that “recited a specific series of steps
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`that resulted in a departure from the routine and conventional sequence of events
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`after the click of a hyperlink advertisement.” Id. at 1371. Here, the Claims recite
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`generic computer elements performing routine and conventional computer activity.
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`Similarly, the ineligible claims in OIP “merely recite[d] ‘well-understood,
`
`routine conventional activit[ies],’ either by requiring conventional computer activi-
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`ties or routine data-gathering steps” (e.g., “sending ... messages over a network to
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`devices,’ the devices being ‘programmed to communicate,’ storing test results in a
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`‘machine-readable medium’”). 788 F.3d at 1360-63 (analyzing Pat. No. 7,970,713
`
`(Ex.1241)) (quoting Alice, 134 S. Ct. at 2359). There, the Federal Circuit con-
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`firmed application of DDR is limited to claims “recit[ing] a specific manipulation
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`of a general-purpose computer such that the claims do not rely on a ‘computer
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`network operating in its normal, expected manner.’” Id. at 1363 (citing DDR, 773
`
`
`
`
`
`F.3d at 1258-59). Here too, the Claims recite only routine, conventional computer-
`
`based limitations that operate in a normal, expected manner—and are patent ineli-
`
`gible. See also, e.g., Alice, 134 S. Ct. at 2360; Content Extraction, 776 F.3d at
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`1347-49; Ultramercial, 772 F.3d at 715-16; buySAFE, 765 F.3d at 1355.
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`3.
`
`The Claims Here and in DDR Are Not Comparable
`
`Contrary to PO’s assertion, the Claims and the DDR claims are not alike.
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`While in other CBMs challenging claims of related patents, PO directly compared
`
`those claims to the DDR claims in an (unsuccessful) attempt to draw similarities,
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`PO did not even try to do so here. See, e.g., CBM2015-00015, Pap.33 at 12-14;
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`CBM2015-00016, Pap.33 at 13-18. Indeed, even a cursory review reveals the DDR
`
`claims, which alter the normal operation of clicking an advertisement hyperlink
`
`within a webpage, require substant