`Tel: 571-272-7822
`
`Paper 44
`Entered: August 24, 2016
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`APPLE INC., SAMSUNG ELECTRONICS LTD, and
`SAMSUNG ELECTRONICS AMERICA, INC.,
`Petitioner
`
`v.
`
`SMARTFLASH LLC,
`Patent Owner.
`
`Case CBM2015-000331
`Patent 8,336,772 B2
`
`Before JENNIFER S. BISK, RAMA G. ELLURU, GREGG I. ANDERSON,
`and MATTHEW R. CLEMENTS, Administrative Patent Judges.
`
`CLEMENTS, Administrative Patent Judge.
`
`DECISION
`Denying Patent Owner’s Request for Rehearing
`37 C.F.R. § 42.71
`
`
`
`
`
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`
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`1 Samsung’s challenge to claims 26 and 32 of U.S. Patent No. 8,336,772 B2
`in CBM2015-00059 was consolidated with this proceeding. Paper 24, 9–10.
`
`
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`CBM2015-00033
`Patent 8,336,772 B2
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`INTRODUCTION
`Apple Inc. (“Apple”) filed a Corrected Petition to institute covered
`business method patent review of claims 25, 26, 30, and 32 of U.S. Patent
`No. 8,336,772 B2 (Ex. 1401, “the ’772 patent”) pursuant to § 18 of the
`Leahy-Smith America Invents Act (“AIA”). Paper 5 (“Pet.”). On May 28,
`2015, we instituted a covered business method patent review based upon
`Apple’s assertion that claims 25, 26, 30, and 32 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 a challenge by Samsung
`Electronics America, Inc., and Samsung Electronics, Co., Ltd. (collectively,
`“Samsung”) to claim 26 and 32 of the ’772 patent with this proceeding.
`Paper 24, 9–10; Samsung Electronics America, Inc. v. Smartflash LLC, Case
`CBM2015-00059 (Paper 13) (PTAB August 5, 2015).
`In our Final Decision, we determined that Petitioners Apple and
`Samsung had established, by a preponderance of the evidence, that claims
`25, 26, 30, and 32 of the ’772 patent are unpatentable. Paper 40 (“Final
`Dec.”), 3, 34. Smartflash requests rehearing of the Final Decision. Paper 41
`(“Request” or “Req. Reh’g”). Subsequent to its Rehearing Request,
`Smartflash, with authorization, filed a Notice of Supplemental Authority.
`Paper 42 (“Notice”). Apple and Google filed a Response to Smartflash’s
`Notice. Paper 43 (“Notice Resp.”). Having considered Patent Owner’s
`Request, we decline to modify our Final Decision.
`
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`CBM2015-00033
`Patent 8,336,772 B2
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`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.
`
`ANALYSIS
`Smartflash’s Request is based on a disagreement with our
`determination that claims 25, 26, 30, and 32 (“the challenged claims”) are
`directed to patent-ineligible subject matter. Req. Reh’g 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
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`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.
`15-29.” 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. 15-37” (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. 29, 36-37; see also, id. 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 11–13) 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. 15–29 (Patent Owner Response argues that claims
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`are statutory under only the second step of Mayo and Alice); see also Paper
`38 (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. 19) (“The Board rejected Patent
`Owner’s reliance on DDR Holdings (at 19), 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,
`11–15) were addressed at pages 13–23 of our Final Decision, Smartflash’s
`arguments about preemption (Req. Reh’g. 7) were addressed at pages 23–25
`of our Final Decision, and Smartflash’s arguments about DDR Holdings
`(Req. Reh’g. 7–10) were addressed at pages 17–21 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:
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`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 U.S.
`Patent No. 7,334,720 B22 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
`’772 patent specification treats as well-known and conventional all
`potentially technical elements of claims 25, 26, 30, and 32, the claimed code
`performs generic computer functions, and the claims recite several generic
`
`
`2 We note that the U.S. Patent No. 7,334,720 B2 is not at issue in this
`proceeding.
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`and conventional data types. Final Dec. 15–17; Notice Resp. 1–2. These
`limitations of claims 25, 26, 30, and 32 “do not yield a result that overrides
`the routine and conventional manner in which this technology operates.”
`Final Dec. 20. 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. 22. 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. at
`22–23 (citing Ex. 1415, 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.
`
`
`ORDER
`
`Accordingly, it is:
`ORDERED that Smartflash’s Rehearing Request is denied.
`
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`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 22–23.
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`CBM2015-00033
`Patent 8,336,772 B2
`
`PETITIONER APPLE:
`J. Steven Baughman
`Megan Raymond
`Ching-Lee Fukuda
`James R. Batchelder
`ROPES & GRAY LLP
`steven.baughman@ropesgray.com
`Megan.raymond@ropesgray.com
`ching-lee.fukuda@ropesgray.com
`james.batchelder@ropesgray.com
`
`PETITIONER SAMSUNG:
`Walter Renner
`Thomas Rozylowicz
`FISH & RICHARDSON P.C.
`axf@fr.com
`CBM39843-0003CP1@fr.com
`
`
`
`PATENT OWNER:
`
`Michael R. Casey
`J. Scott Davidson
`DAVIDSON BERQUIST JACKSON & GOWDEY LLP
`mcasey@dbjg.com
`jsd@dbjg.com
`
`
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