Trials@uspto.gov
`Tel: 571-272-7822
`
`Paper 47
`Entered: August 23, 2016
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`APPLE INC.,
`Petitioner
`
`And
`
`GOOGLE INC.,
`Petitioner
`
`v.
`
`SMARTFLASH LLC,
`Patent Owner.
`
`Case CBM2015-000291
`Patent 7,334,720 B2
`
`Before JENNIFER S. BISK, RAMA G. ELLURU,
`GREGG I. ANDERSON, and MATTHEW R. CLEMENTS,
`Administrative Patent Judges.
`
`ELLURU, Administrative Patent Judge.
`
`
`
`DECISION
`Denying Patent Owner’s Request for Rehearing
`37 C.F.R. § 42.71
`
`
`
`
`
`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.
`
`
`
`
`
`
`
`
`
`
`Tel: 571-272-7822
`
`Paper 47
`Entered: August 23, 2016
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`APPLE INC.,
`Petitioner
`
`And
`
`GOOGLE INC.,
`Petitioner
`
`v.
`
`SMARTFLASH LLC,
`Patent Owner.
`
`Case CBM2015-000291
`Patent 7,334,720 B2
`
`Before JENNIFER S. BISK, RAMA G. ELLURU,
`GREGG I. ANDERSON, and MATTHEW R. CLEMENTS,
`Administrative Patent Judges.
`
`ELLURU, Administrative Patent Judge.
`
`
`
`DECISION
`Denying Patent Owner’s Request for Rehearing
`37 C.F.R. § 42.71
`
`
`
`
`
`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.
`
`
`
`
`
`
`
`
`
`
`
`CBM2015-00029
`Patent 7,334,720 B2
`
`INTRODUCTION
`
`Apple Inc. (“Apple”), filed a Corrected Petition to institute covered
`
`business method patent review of claims 3 and 13–15 of U.S. Patent No.
`
`7,334,720 B2 (Ex. 1301, “the ’720 patent”) pursuant to § 18 of the Leahy-
`
`Smith America Invents Act (“AIA”).2 Paper 5 (“Pet.”). On May 28, 2015,
`
`we instituted a transitional covered business method patent review based
`
`upon Apple’s assertion that claims 3 and 15 are directed to patent ineligible
`
`subject matter under 35 U.S.C. § 101. Paper 11, 19. Subsequent to
`
`institution, Smartflash LLC (“Smartflash”) filed a Patent Owner Response
`
`(Paper 23, “PO Resp.”) and Apple filed a Reply (Paper 26, “Pet. Reply”) to
`
`Patent Owner’s Response. We consolidated Google, Inc.’s (“Google”)
`
`challenge to claim 15 of the ’720 patent with this proceeding. Paper 28, 10;
`
`Google Inc. v. Smartflash LLC, Case CBM2015-00125 (Paper 11) (PTAB
`
`Nov. 16, 2015).
`
`In our Final Decision, we determined that Petitioners Apple and
`
`Google had established, by a preponderance of the evidence, that claims 3
`
`and 15 of the ’720 patent are unpatentable. Paper 43 (“Final Dec.”), 3, 33.
`
`Smartflash requests rehearing of the Final Decision. Paper 44 (“Request” or
`
`“Req. Reh’g”). Subsequent to its Rehearing Request, Smartflash, with
`
`authorization, filed a Notice of Supplemental Authority. Paper 45
`
`(“Notice”). Apple and Google filed a Response to Smartflash’s Notice.
`
`Paper 46 (“Notice Resp.”). Having considered Patent Owner’s Request, we
`
`decline to modify our Final Decision.
`
`
`
`
`2 Pub. L. No. 112-29, 125 Stat. 284, 296–07 (2011).
`
`2
`
`
`
`CBM2015-00029
`Patent 7,334,720 B2
`
`STANDARD OF REVIEW
`
`In covered business method patent review, the petitioner has the
`
`burden of showing unpatentability by a preponderance of the evidence. 35
`
`U.S.C. § 326(e). The standard of review for rehearing requests is set forth in
`
`37 C.F.R. § 42.71(d), which states:
`
`The burden of showing a decision should be modified lies with
`the party challenging the decision. The request must specifically
`identify all matters the party believes the Board misapprehended
`or overlooked, and the place where each matter was previously
`addressed in a motion, an opposition, or a reply.
`
`Smartflash’s Request is based on a disagreement with our
`
`ANALYSIS
`
`determination that claims 3 and 15 (“the challenged claims”) are directed to
`
`patent-ineligible subject matter. Req. Reh’g 4–5. In its Request, Smartflash
`
`presents arguments directed to alleged similarities between the challenged
`
`claims and those at issue in DDR Holdings, LLC v. Hotels.com, L.P., 773
`
`F.3d 1245 (Fed. Cir. 2014) (Req. Reh’g 5–10) and Enfish, LLC v. Microsoft
`
`Corp., No. 2015-2044 (Fed. Cir. May 12, 2016), and alleged differences
`
`between the challenged claims and those at issue in Alice Corp. Pty. Ltd. v.
`
`CLS Bank Int’l., 134 S. Ct. 2347 (2014) (id. at 10–15).
`
`As noted above, our rules require that the requesting party
`
`“specifically identify all matters the party believes the Board
`
`misapprehended or overlooked, and the place where each matter was
`
`previously addressed in a motion, an opposition, or a reply.” 37 C.F.R.
`
`42.71(d) (emphasis added). In its Request, however, Smartflash does not
`
`identify any specific matter that we misapprehended or overlooked. Rather,
`
`the only citation to Smartflash’s previous arguments are general citations,
`
`without explanation as to how we misapprehended or overlooked any
`
`3
`
`
`
`CBM2015-00029
`Patent 7,334,720 B2
`
`particular matter in the record. For example, with respect to Smartflash’s
`
`arguments regarding DDR Holdings, Smartflash simply notes that
`
`“[p]ursuant to 37 C.F.R. § 42.71(d), whether the challenged claims were
`
`similar to those in DDR Holdings was previously addressed. See PO Resp.
`
`1, 16-22.” Request 7 n.3. Similarly, in Smartflash’s arguments regarding
`
`Alice, Smartflash simply notes that “[p]ursuant to 37 C.F.R. § 42.71(d), the
`
`issue of whether the claims are directed to patent eligible subject matter was
`
`previously addressed. See PO Resp. 15-27” (id. at 11 n.4) and “[p]ursuant to
`
`37 C.F.R. § 42.71(d), the issue of whether the challenged claims contain
`
`‘additional features’ beyond an abstract idea was previously addressed. See
`
`PO Resp. 21-22; see also id. at 4-9” (id. at 13 n.5). These generic citations
`
`to large portions of the record do not identify, with any particularity, specific
`
`arguments that we may have misapprehended or overlooked.
`
`Rather than providing a proper request for rehearing, addressing
`
`particular matters that we previously misapprehended or overlooked,
`
`Smartflash’s Request provides new briefing by expounding on argument
`
`already made. Smartflash cannot simply allege that an “issue” (e.g., whether
`
`the claims are directed to an abstract idea) was previously addressed,
`
`generally, and proceed to present new argument on that issue in a request for
`
`rehearing. See 37 C.F.R. § 42.71.
`
`Smartflash’s arguments are either new or were addressed in our Final
`
`Decision. For example, Smartflash’s argument that the challenged claims
`
`are not directed to an abstract idea (Req. Reh’g 10–12) is new, and therefore,
`
`improper in a request for rehearing, because Smartflash did not argue the
`
`first step of the analysis articulated in Mayo and Alice in its Patent Owner
`
`Response. See PO Resp. 15–22 (Patent Owner Response argues that claims
`
`4
`
`
`
`CBM2015-00029
`Patent 7,334,720 B2
`
`are statutory under only the second step of Mayo and Alice); see also Paper
`
`41 (transcript of oral hearing), 6:13–16 (Petitioner stating that “Patent
`
`Owner has presented no argument whatsoever to contest that its claims are
`
`directed to abstract ideas under the first prong of Mayo and Alice.”), id. at
`
`6:17–18 (Petitioner also stating “It [] also never disputed the articulation of
`
`those abstract ideas”).
`
`To the extent portions of the Request are supported by Smartflash’s
`
`argument in the general citations to the record, we considered those
`
`arguments in our Final Decision, as even Patent Owner acknowledges. See,
`
`e.g., Req. Reh’g 7 (citing Final Dec. 14) (“The Board rejected Patent
`
`Owner’s reliance on DDR Holdings (at 14), holding that the challenged
`
`claims were not ‘rooted in computer technology in order to overcome a
`
`problem specifically arising in the realm of computer networks.’”). For
`
`example, Smartflash’s arguments about inventive concept (Req. Reh’g 5–7,
`
`10–15) were addressed at pages 11–21 of our Final Decision, Smartflash’s
`
`arguments about preemption (Req. Reh’g. 6–7) were addressed at pages 21–
`
`24 of our final Decision, and Smartflash’s arguments about DDR Holdings
`
`(Req. Reh’g. 7–10) were addressed at pages 16–19 of our Final Decision.
`
`Mere disagreement with our Final Decision also is not a proper basis for
`
`rehearing. Accordingly, Smartflash’s Request does not apprise us of
`
`sufficient reason to modify our Final Decision.
`
`Smartflash’s Notice of Supplemental Authority also does not alter the
`
`determination in our Final Decision. Smartflash characterized the Federal
`
`Circuit’s decision in BASCOM Global Internet Services, Inc. v. AT&T
`
`Mobility, LLC., ___ F.3d ___, 2016 WL 3514158, *6-*7 (Fed. Cir. June 27,
`
`2016) as follows:
`
`5
`
`
`
`CBM2015-00029
`Patent 7,334,720 B2
`
`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.
`
`Notice 1. Relying on BASCOM, Smartflash contends that its claims “‘recite
`
`a specific, discrete implementation’ – concrete devices, systems, and
`
`methods – for purchasing, downloading, storing, and conditioning access to
`
`digital content.” Notice 2 (citation omitted). Using claim 3 of the ’720
`
`patent as an example, Smartflash contends that the challenged claims
`
`“describ[e] a system for content delivery that uses a data carrier that stores
`
`(1) payment data that a data access terminal transmits to a payment
`
`validation system; (2) content data delivered by a data supplier; and
`
`(3) access rules supplied by the data supplier – thus ‘improv[ing] an existing
`
`technological process.’” Id. at 2–3. According to Smartflash, the “specific
`
`arrangement of data elements and organization of transaction steps”
`
`“provides a technical solution that improves the functioning of the data
`
`access terminal.” Id. at 3. We disagree.
`
`
`
`As we stated in our Final Written Decision and Petitioners argue, the
`
`’720 patent specification treats as well-known and conventional all
`
`potentially technical elements of claims 3 and 15, the claimed method steps
`
`perform generic computer functions, and the claims recite several generic
`
`and conventional data types. Final Dec. 12–15; Notice Resp. 1–2. These
`
`limitations of claims 3 and 15 “do not yield a result that overrides the routine
`
`and conventional manner in which this technology operates.” Final Dec. 18.
`
`6
`
`
`
`CBM2015-00029
`Patent 7,334,720 B2
`
`Rather, each of the challenged claims is “an abstract-idea-based solution
`
`implemented with generic technical components in a conventional way,”
`
`making it patent ineligible. See BASCOM, 2016 WL 3514158, at *6, *7.
`
`Also, “[t]he concept of storing two different types of information3 in the
`
`same place or on the same device is an age old practice.” Final Dec. 20. For
`
`example, “the prior art discloses products, such as electronic data, that could
`
`store both the content and conditions for providing access to the content,
`
`such as ‘a time bomb or other disabling device which will disable the
`
`product at the end of the rental period.’” Id. (citing Ex. 1315, Abstract,
`
`10:24–30).
`
`
`
`Lastly, Smartflash also reargues that DDR Holdings is controlling.
`
`Notice 3. As we discussed above, however, our Final Written Decision
`
`addresses DDR Holdings.
`
`
`
`Accordingly, it is:
`
`ORDER
`
`ORDERED that Smartflash’s Rehearing Request is denied.
`
`
`
`
`
`
`
`
`3 We agree with Petitioners that Smartflash newly argues that combining
`payment data, content data, and rules on the data carrier is “inventive.”
`Notice 2–3; Notice Resp. 2; PO Resp. 13; Final Decision 19–20.
`
`7
`
`
`
`CBM2015-00029
`Patent 7,334,720 B2
`
`PETITIONER APPLE:
`
`J. Steven Baughman
`Ching-Lee Fukuda
`Megan Raymond
`Ropes & Gray LLP
`steven.baughman@ropesgray.com
`ching-lee.fukuda@ropesgray.com
`Megan.raymond@ropesgray.com
`
`
`PETITIONER GOOGLE:
`
`Raymond Nimrod
`
`raynimrod@quinnemanuel.com
`
`Andrew Holmes
`QE-SF-PTAB-Service@quinnemanuel.com
`
`PATENT OWNER:
`
`Michael R. Casey
`J. Scott Davidson
`DAVIDSON BERQUIST JACKSON & GOWDEY LLP
`mcasey@dbjg.com
`jsd@dbjg.com
`
`
`
`
`8
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