`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`_________________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`_________________
`
`GOOGLE LLC and APPLE INC.,
`
`Petitioners,
`
`v.
`
`CONTENTGUARD HOLDINGS, INC.,
`
`Patent Owner.
`_________________
`
`Case CBM2015-000401
`Patent No. 7,774,280 B2
`_________________
`
`PATENT OWNER’S RESPONSE REMAND BRIEF
`
`
`
`
`
`
`Mail Stop PATENT BOARD
`Patent Trial and Appeal Board
`U.S. Patent and Trademark Office
`P.O. Box 1450
`Alexandria, VA 22313-1450
`
`
`1 Case CBM2015-00160 has been joined with this proceeding.
`
`
`
`The Petition alleged CBM jurisdiction by pointing to portions of the ‘280
`
`specification disclosing embodiments involving distributing digital content for a fee.
`
`(Paper 1 at 9-14.) That argument is now foreclosed by the holding in Unwired Planet
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`that a patent does not become a CBM patent merely because it discloses that
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`practicing the invention could involve a potential sale of a good or service. Unwired
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`Planet, LLC v. Google Inc., 841 F.3d 1376, 1382 (Fed. Cir. 2016).
`
`Petitioners’ remand brief emphasizes many of the same passages from the
`
`‘280 specification and the ‘012 specification disclosing that meta-rights and usage
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`rights may be deployed in systems where digital content is sold. Those disclosures
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`are insufficient as a matter of law because “the mere possibility that a patent can be
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`used in financial transactions is not enough to make it a CBM patent.” Apple Inc. v.
`
`ContentGuard Holdings, Inc., 2018 U.S. App. LEXIS 19258, *8 (Fed. Cir. July 11,
`
`2018) (nonprecedential) (citing Unwired Planet, 841 F.3d at 1382).
`
`Petitioners must demonstrate that the ‘280 patent claims are “directed to” a
`
`method or apparatus “used in the practice, administration, or management of a
`
`financial product or service.” Id. Their arguments on remand fail to do so. The claim
`
`language is not directed to a “business model” or to an “exchange between suppliers
`
`and consumers” of a “financial nature.” (Paper 44 at 4, 7.) The claims recite creating
`
`and transferring rights and not the commercial distribution of digital content. (Id. at
`
`4-5.) There is no mention of a business model, a sale, a fee transaction or any other
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`1
`
`
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`financial activity. The descriptions in the specification providing background
`
`information regarding business models for commercial distribution of content do not
`
`limit the claims.2 The specification passages mentioning fees make clear that fees
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`are not a required aspect of the invention.
`
`The Federal Circuit did not endorse the argument that the ‘280 claims describe
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`an exchange that is financial in nature. The portions of the oral argument cited by
`
`Petitioners concern one panel member’s observations regarding the specification,
`
`not the claims. The Federal Circuit ultimately found that the ‘280 patent “explains
`
`how the claimed invention can be used in ways that do not involve financial
`
`transactions.” ContentGuard Holdings, 2018 U.S. App. LEXIS 19258, *7.
`
`Petitioners’ portrayal of the ‘280 patent specification as disclosing only a “business
`
`model,” and their related assertion that the specification discloses that financial
`
`transactions are necessary to enable the business model, is contrary to that finding
`
`and the evidence. (Paper 44 at 7.)
`
`The claims recite “rights supplier” and “rights consumer” not “seller” and
`
`“purchaser.”3 The assertion that the specification defines “supplier” and “consumer”
`
`
`2 Petitioners misquote the specification as indicating that meta-rights are
`“particularly useful to companies in the digital content business.” (Paper 44 at 3,
`citing GOOG 1001 at 6:1-4.) No such statement appears. The cited passage
`emphasizes the benefit of meta-rights in distribution models that include entities that
`are not creators or owners of digital content.
`that
`3 The Federal Circuit panel was skeptical of Petitioners’ position
`transaction. See
`“consumer” and “supplier” are parties
`to a
`financial
`
`2
`
`
`
`as parties to a business transaction is not correct. (Id. at 4.) The specification
`
`expressly defines “supplier” and “consumer” in generic, non-economic terms.
`
`(GOOG 1001 at 6:10-13 (“For the sake of clarity, the party granting usage rights or
`
`meta-rights is referred to as ‘supplier’ and the party receiving and/or exercising such
`
`rights is referred to as ‘consumer’ herein.”).)
`
`The description of “license” creation in claims 11 and 22 is also insufficient
`
`to qualify the ‘280 patent for CBM review. The specification discloses one example
`
`license that contains a fee requirement. Claims 11 and 22, however, do not recite any
`
`such fee condition. The Board gave “license” the non-financial meaning: “data
`
`embodying a grant of rights.” (Paper 34 at 21.)
`
`The argument that the claims are financial in nature even if “certain
`
`transactions” do not require payment is also misguided. (Paper 44 at 7-8.) The claims
`
`do not refer to “transactions,” and the methods and systems claimed never require
`
`fee payment or any other financial activity. The focus must be on the claim language,
`
`not Petitioners’ generalized abstractions of the claims.
`
`
`http://oralarguments.cafc.uscourts.gov/default.aspx?fl=2016-2548.mp3 at 5:23 –
`5:48 (“Because there’s nothing in the claims themselves that identify financial
`activity. I mean, the word consumer and supplier appears, but that’s in the context
`of consumer rights and supplier rights which is a reference as I understand it to the
`respective rights of the parties, not with respect to the activities of a consumer in the
`financial sense.”)(Bryson, J.) and 15:11 – 15:26 (“But you want us to read
`‘consumer’ as a ‘purchaser,’ whereas a consumer can just simply mean somebody
`who uses or possesses and makes use of some of these rights.”)(Reyna, J.).
`
`3
`
`
`
`The Blue Calypso decision is of no help to Petitioners. The patent in that case
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`was eligible for CBM review because the claims recited “an express financial
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`component in the form of a subsidy” that was “central to the operation of the claimed
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`invention.” Blue Calypso, LLC v. Groupon, Inc., 815 F.3d 1331, 1340 (Fed. Cir.
`
`2016). Petitioners’ representation that the claims alternatively covered the use of
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`coupons or reward codes “instead of a financial subsidy” is misleading. (Paper 44 at
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`8.) The coupons and reward codes were also found to be financial subsidies. Id. at
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`1339-40 and n.3. Thus, the claims in Blue Calypso always require a financial
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`element, whereas the ‘280 claims never do.
`
`The specification does not support Petitioners’ attempts to characterize
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`disclosed embodiments such as sharing digital content within an enterprise,
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`transferring medical records, and loaning digital content at a library, as involving
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`financial transactions. The tangential financial activity that Petitioners imagine
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`might occur is not even remotely suggested by the specification (nor is it recited in
`
`the claims). The specification directly contradicts Petitioners. For example,
`
`Petitioners represent that the specification discloses internal “sales transactions”
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`within an enterprise. However, the passage cited does not describe distributing rights
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`within an enterprise through “sales transactions.” (Paper 44 at 9, citing GOOG 1001
`
`at 6:63-65.) To the contrary, the specification teaches: “[t]he preferred embodiments
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`are not limited to situations where resellers, distributors or other ‘middlemen’ are
`
`4
`
`
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`used. For example, the preferred embodiment can be applied within enterprises or
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`other organizations, which create and/or distribute digital content or other items to
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`control use of the content within the enterprise or other organization.” (Id. at 14:39-
`
`44.) Petitioners do not even mention the numerous other examples illustrated in Figs.
`
`9 to 12 and 14 to 16 of the use of meta-rights to derive and transfer new rights without
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`payment of a fee or any other financial activity. Their characterization of the transfer
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`of medical records as being financial ignores the Federal Circuit’s contrary finding.
`
`ContentGuard Holdings, 2018 U.S. App. LEXIS 19258, *7.
`
`The issue of whether the ‘280 patent is directed to a “technological invention”
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`was not before the Federal Circuit and is not what the Board was directed to address
`
`on remand. Petitioners’ arguments on that subject are not only irrelevant at this stage,
`
`they are inconsistent with the analysis set forth in the Final Decision. In particular,
`
`the Board did not find that the ‘280 patent provides only a business solution to a
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`business problem. (See Paper 34 at 16-18.) Nor did the Board construe the recited
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`“meta-rights” as embodying the concept of sublicensing or the recited “state
`
`variable” as a mechanism for providing bookkeeping in digital form. The Board
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`provided entirely non-financial constructions to those terms. (Id. at 21, 24.)
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`Because Petitioners have not satisfied their burden to prove that the ‘280
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`patent is a CBM patent under the statutory definition, this proceeding should be
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`terminated.
`
`5
`
`
`
`Respectfully submitted,
`
`FITCH EVEN TABIN & FLANNERY LLP
`
`
`
`
`
`/Timothy P. Maloney/
`Timothy P. Maloney
`Registration No. 38,233
`tim@fitcheven.com
`
`
`
`
`
`
`
`
`Date: November 9, 2018
`
`120 S. LaSalle Street, Suite 2100
`Chicago, Illinois 60603-3406
`(312) 577-7000
`(312) 577-7007 (fax)
`
`
`
`
`
`
`
`6
`
`
`
`CERTIFICATE OF SERVICE
`
`The undersigned certifies in accordance with 37 C.F.R. § 42.6(e) that on
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`November 9, 2018, a copy of the foregoing PATENT OWNER’S RESPONSE
`
`REMAND BRIEF was served on Petitioners at the following email addresses:
`
`Robert Unikel, robertunikel@paulhastings.com
`Robert R. Laurenzi, robertlaurenzi@paulhastings.com
`Jeffrey P. Kushan, jkushan@sidley.com
`Michael R. Franzinger, mfranzinger@sidley.com
`Thomas A. Broughan, III, tbroughan@sidley.com
`
`Date: November 9, 2018
`
`120 S. LaSalle Street, Suite 2100
`Chicago, Illinois 60603-3406
`(312) 577-7000
`(312) 577-7007 (fax)
`
`
`
`
`
`/Timothy P. Maloney/
`Timothy P. Maloney
`Registration No. 38,233
`tim@fitcheven.com
`
`
`
`
`
`
`7
`
`
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