UNITED STATES PATENT and TRADEMARK OFFICE
`
`_________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`_________
`
`APPLE INC. AND GOOGLE INC.,
`
`Petitioners,
`
`v.
`
`SMARTFLASH LLC,
`
`Patent Owner.
`
`_________
`
`Case CBM2015-000291
`
`Patents 7,334,720 B2
`
`_________
`
`
`
`PATENT OWNER’S NOTICE OF SUPPLEMENTAL AUTHORITY
`
`
`
`
`
`
`1 The challenge to claim 15 of U.S. Patent No. 7,334,720 B2 in CBM2015-00125
`was consolidated with this proceeding. Paper 28, 9–11.
`
`
`
`_________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`_________
`
`APPLE INC. AND GOOGLE INC.,
`
`Petitioners,
`
`v.
`
`SMARTFLASH LLC,
`
`Patent Owner.
`
`_________
`
`Case CBM2015-000291
`
`Patents 7,334,720 B2
`
`_________
`
`
`
`PATENT OWNER’S NOTICE OF SUPPLEMENTAL AUTHORITY
`
`
`
`
`
`
`1 The challenge to claim 15 of U.S. Patent No. 7,334,720 B2 in CBM2015-00125
`was consolidated with this proceeding. Paper 28, 9–11.
`
`
`
`The Federal Circuit’s recent decision in BASCOM Global Internet Services,
`
`Inc. v. AT&T Mobility, LLC., ___ F.3d ___, 2016 WL 3514158, No. 2015-1763
`
`(Fed. Cir. June 27, 2016) clarifies the analysis under step two of Alice Corp. v.
`
`CLS Bank International, 134 S. Ct. 2347 (2014). That decision confirms that the
`
`claims at issue here contain an “inventive concept” and, in particular, that “an
`
`inventive concept can be found in the non-conventional and non-generic
`
`arrangement of known, conventional pieces.” 2016 WL 3514158, at *6; see also
`
`Rapid Litigation Management Ltd. V. Cellzdirect, Inc., ___ F.3d ___, 2016 WL
`
`3606624, at *6, No. 2015-1570 (Fed. Cir. July 5, 2016).
`
`The claimed Internet content filtering system in BASCOM could be located
`
`on a remote ISP server and customized to individual subscribers’ accounts by
`
`associating each network account with filtering schemes and filtering elements.
`
`See 2016 WL 3514158, at *3. The Federal Circuit concluded, at step two of Alice,
`
`that the claims did not “merely recite the abstract idea of filtering content along
`
`with the requirement to perform it on the Internet, or to perform it on a set of
`
`generic computer components.” Id. at *6-*7. The patent claimed “installation of a
`
`filtering tool at a specific location . . . with customizable filtering features specific
`
`to each end user.” Id. at *6. That design provided specific benefits over
`
`alternatives; it was not “conventional or generic.” Id. The Court distinguished the
`
`claims in Ultramercial v. Hulu, LLC, 772 F.3d 709 (Fed. Cir. 2014), which
`
`
`
`1
`
`
`
`“preempted all use of the claimed abstract idea on the Internet”; the claims in
`
`BASCOM “carve out a specific location for the filtering system . . . and require the
`
`filtering system to give users the ability to customize filtering.” Id. at *8.
`
`The Alice step-two analysis in BASCOM applies to the Smartflash claims.
`
`Even assuming the claims are directed to an abstract idea (“paying for and/or
`
`controlling access to content” in one of Petitioner’s formulations), they do not
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`“merely recite [that] abstract idea” nor do they “preempt all ways” of paying for
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`and controlling access to digital content. Id. at *7. On the contrary, the claims
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`“recite a specific, discrete implementation” – concrete devices, systems, and
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`methods – for purchasing, downloading, storing, and conditioning access to digital
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`content. Id. In BASCOM, locating a filtering system on an ISP server was
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`conventional, as was customizing a filtering scheme for an individual user. See Id.
`
`at *6. Nevertheless, “the inventive concept inquiry requires more than recognizing
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`that each claim element, by itself, was known in the art.” Id. The fact that known
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`components were arranged in a non-conventional and non-generic way satisfied
`
`§ 101. Here, as in BASCOM, the “patent describes how its particular arrangement
`
`of elements is a technical improvement over prior art ways” of distributing digital
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`content – for example, in the case of Claim 3 of the ’720 patent, by describing a
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`system for content delivery that uses a data carrier that stores (1) payment data that
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`a data access terminal transmits to a payment validation system; (2) content data
`
`
`
`2
`
`
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`delivered by a data supplier; and (3) access rules supplied by the data supplier –
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`thus “improv[ing] an existing technological process.” Id. at *7. That specific
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`arrangement of data elements and organization of transaction steps, like the
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`installation of particular software at an ISP server rather than on a client computer,
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`cannot be dismissed as merely conventional or generic, but instead provides a
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`technical solution that improves the functioning of the data access terminal.
`
`
`
`BASCOM also confirms that DDR is controlling notwithstanding the asserted
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`generality of the claims. The Smartflash patents provide a “technical solution to a
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`problem unique to the Internet.” Id. The patents “claim[] a technical way to
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`satisfy an existing problem” for digital content providers – namely, rampant digital
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`content piracy – thus providing a “technology-based solution . . . that overcomes
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`existing problems” with digital content distribution. Id.; see also Metro-Goldwyn-
`
`Mayer Studios, Inc. v. Grokster, Ltd., 545 U.S. 913, 929-30 (2005) (“[D]igital
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`distribution of copyrighted material threatens copyright holders as never before,
`
`because every copy is identical to the original, copying is easy, and many people
`
`. . . use file-sharing software to download copyrighted works.”). The patent does
`
`not claim “an abstract-idea-based solution implemented with generic technical
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`components in a conventional way.” BASCOM, 2016 WL 3514158, at *7. Like
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`the patents in DDR and BASCOM, Smartflash claims a “software-based invention[]
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`that improve[s] the performance of the computer system itself.” Id.
`
`
`
`3
`
`
`
` /
`
` Michael R. Casey /
`
`
`Michael R. Casey
`Registration No. 40,294
`Davidson Berquist Jackson & Gowdey, LLP
`8300 Greensboro Drive
`Suite 500
`McLean, VA 22102
`Telephone: (571) 765-7705
`Fax: (571) 765-7200
`Email: mcasey@dbjg.com
`Attorney for Patent Owner
`
`
`
`
`Dated: July 20, 2016
`
`
`
`
`
`
`
`4
`
`
`
`
`
`CERTIFICATE OF SERVICE
`
`The undersigned hereby certifies that this PATENT OWNER’S NOTICE
`
`OF SUPPLEMENTAL AUTHORITY in CBM2015-00029 was served today by
`
`emailing a copy to counsel for the Petitioners as follows:
`
`J. Steven Baughman (steven.baughman@ropesgray.com)
`Megan Raymond (megan.raymond@ropesgray.com)
`James R. Batchelder (james.batchelder@ropesgray.com)
`ApplePTABService-SmartFlash@ropesgray.com
`Attorneys for Petitioner Apple Inc.
`
`
`
`Raymond Nimrod (raynimrod@ quinnemanuel.com)
`QE-SF-PTAB-Service@quinnemanuel.com
`Attorneys for Petitioner Google Inc.
`
`
`
`Dated: July 20, 2016
`
`
`
`
`
`
`
` /
`
` Michael R. Casey /
`
`
`Michael R. Casey
`Registration No. 40,294
`Davidson Berquist Jackson & Gowdey, LLP
`8300 Greensboro Drive
`Suite 500
`McLean, VA 22102
`Telephone: (571) 765-7705
`Fax: (571) 765-7200
`Email: mcasey@dbjg.com
`Attorney for Patent Owner
`
`5
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