Trials@uspto.gov
`571-272-7822
`
`Paper 7
`Entered: July 1, 2015
`
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`SONY CORPORATION OF AMERICA,
`Petitioner,
`
`v.
`
`NETWORK-1 TECHNOLOGIES, INC.,
`Patent Owner.
`____________
`
`Case CBM2015-00078
`Patent 6,218,930 B1
`____________
`
`Before JONI Y. CHANG, JUSTIN T. ARBES, and GLENN J. PERRY,
`Administrative Patent Judges.
`
`ARBES, Administrative Patent Judge.
`
`DECISION
`Denying Institution of Covered Business Method Patent Review
`37 C.F.R. § 42.208
`
`
`571-272-7822
`
`Paper 7
`Entered: July 1, 2015
`
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`SONY CORPORATION OF AMERICA,
`Petitioner,
`
`v.
`
`NETWORK-1 TECHNOLOGIES, INC.,
`Patent Owner.
`____________
`
`Case CBM2015-00078
`Patent 6,218,930 B1
`____________
`
`Before JONI Y. CHANG, JUSTIN T. ARBES, and GLENN J. PERRY,
`Administrative Patent Judges.
`
`ARBES, Administrative Patent Judge.
`
`DECISION
`Denying Institution of Covered Business Method Patent Review
`37 C.F.R. § 42.208
`
`
`
`CBM2015-00078
`Patent 6,218,930 B1
`
`
`Petitioner Sony Corporation of America filed a Petition (Paper 2,
`“Pet.”) requesting covered business method patent review of claims 6 and
`8–23 of U.S. Patent No. 6,218,930 B1 (Ex. 1001, “the ’930 patent”) pursuant
`to 35 U.S.C. §§ 321–29. Patent Owner Network-1 Technologies, Inc. filed a
`Preliminary Response (Paper 5, “Prelim. Resp.”).
`We have jurisdiction under 35 U.S.C. § 324. Pursuant to 35 U.S.C.
`§ 324(a), the Director may not authorize a covered business method patent
`review unless the information in the petition, if unrebutted, “would
`demonstrate that it is more likely than not that at least 1 of the claims
`challenged in the petition is unpatentable.” For the reasons that follow, we
`have decided not to institute a covered business method patent review.
`
`I. BACKGROUND
`A. The ’930 Patent
`The ’930 patent relates to “the powering of 10/100 Ethernet
`compatible equipment,” specifically “automatically determining if remote
`equipment is capable of remote power feed and if it is determined that the
`remote equipment is able to accept power remotely then to provide power in
`a reliable non-intrusive way.” Ex. 1001, col. 1, ll. 13–19. The ’930 patent
`describes how it generally was known in the prior art to power
`telecommunications equipment, such as telephones, remotely, but doing so
`had not “migrated to data communications equipment” due to various
`problems, such as the high power levels required by data communications
`equipment. Id. at col. 1, ll. 22–32. The ’930 patent describes a need in the
`art to power data communications equipment remotely and to “reliably
`determin[e] if a remote piece of equipment is capable of accepting remote
`
`
`
`2
`
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`CBM2015-00078
`Patent 6,218,930 B1
`
`power.” Id. at col. 1, ll. 42–44. Figure 3 of the ’930 patent is reproduced
`below.
`
`
`Figure 3 depicts remote telephone 62, which is capable of receiving and
`transmitting both voice and data. Id. at col. 3, ll. 60–66. Telephone 62 is
`connected to access node 64 at the customer’s premises, and access node 64
`is connected to one of the ports of Ethernet switch 68 via wiring 66
`comprising “a Category 5 Ethernet 100BaseX cable of 4 sets of unshielded
`twisted pairs.” Id. Ethernet switch 68 comprises automatic remote power
`detector 22 (shown in Figure 1) and remote power supply 34 (shown in
`Figure 2). Id. at col. 4, ll. 1–4.
`The preferred embodiment described in the ’930 patent operates as
`follows. A remote access device, such as the telephone shown in Figure 3,
`normally is powered by “an [alternating current] ac transformer adapter
`plugged in to the local 110 volt supply,” but may or may not be capable of
`being powered remotely. Id. at col. 2, ll. 40–44. The system detects
`whether the access device is capable of being powered remotely by
`
`
`
`3
`
`
`
`CBM2015-00078
`Patent 6,218,930 B1
`
`“delivering a low level current (approx. 20 [milliamperes (mA)])” over
`existing twisted pairs of an Ethernet cable used for data signaling and
`“measuring a voltage drop in the return path.” Id. at col. 2, l. 66–col. 3, l. 2,
`col. 3, ll. 44–48. If there is no voltage drop or a fixed voltage level is
`detected, the device is not capable of accepting remote power. Id. at col. 3,
`ll. 2–11. If a varying or “sawtooth” voltage level occurs (caused by the
`access device repeatedly beginning to start up but being “unable to sustain
`the start up” due to the low current level), the device is capable of accepting
`remote power. Id. at col. 3, ll. 12–22. The system then increases the power
`being supplied remotely to the access device. Id. Once the access device is
`operating under remote power, the system looks for removal of the access
`device and decreases the power being supplied when the device is no longer
`connected. Id. at col. 3, ll. 49–58.
`
`
`B. Illustrative Claim
`Claim 23 of the ’930 patent recites:
`23. Method for remotely powering access equipment in
`an Ethernet data network, comprising:
`(a) providing an access device adapted for data
`transmission;
`(b) connecting said access device to at least one data
`signaling pair connected between the access device and a data
`node adapted for data switching, wherein said at least one data
`signaling pair is arranged to transmit data therebetween;
`(c) receiving at said access device a low level current
`from a main power source over said data signaling pair,
`wherein said main power source is connected to supply power
`to the data node; and wherein a voltage level is generated on the
`data signaling pair in response to the low level current;
`
`
`
`4
`
`
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`CBM2015-00078
`Patent 6,218,930 B1
`
`
`(d) producing a voltage level on the data signaling pair in
`response to the low level current, wherein said voltage level can
`be sensed;
`(e) receiving at said access device controlled power
`supplied by a secondary power source arranged to supply power
`from the data node via said data signaling pair to the access
`device, in response to a preselected condition of said voltage
`level.
`
`Publication
`(Ex. 1025,
`
`
`C. The Prior Art
`Petitioner relies on the following prior art:
`U.S. Patent No. 5,345,592,
`issued Sept. 6, 1994
`(Ex. 1024, “Woodmas”);
`Application
`International
`Patent
`No. WO 96/23377, published Aug. 1, 1996
`“Hunter”);
`Japanese Unexamined Patent Application Publication
`No. H10-13576, published Jan. 16, 1998 (Ex. 1027) (Ex. 1028,
`English translation, “Matsuno”);
`Ron Whittaker, TELEVISION PRODUCTION 232–56 (1993)
`(Ex. 1026, “Television Production”).
`
`D. The Asserted Grounds
`Petitioner challenges claims 6 and 8–23 of the ’930 patent on the
`following grounds:
`Reference(s)
`
`Basis
`
`Claim(s) Challenged
`
`Woodmas
`
`35 U.S.C. § 102(b)
`
`6, 8, 9, 12–17, 19, and 22
`
`Woodmas and Hunter 35 U.S.C. § 103(a)
`
`6 and 8–23
`
`Woodmas and
`Television Production
`
`35 U.S.C. § 103(a)
`
`6, 8, 9, 12–17, 19, and 22
`
`
`
`5
`
`
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`CBM2015-00078
`Patent 6,218,930 B1
`
`
`Reference(s)
`
`Basis
`
`Claim(s) Challenged
`
`Matsuno
`
`35 U.S.C. § 103(a)
`
`22
`
`Matsuno and Hunter
`
`35 U.S.C. § 103(a)
`
`20, 21, and 23
`
`
`
`E. Related Proceedings
`The ’930 patent was challenged previously in a number of petitions
`seeking inter partes review. In Case IPR2013-00071 (“the -71 Case”),
`Avaya Inc. (“Avaya”) challenged claims 6 and 9 based on certain prior art,
`including Matsuno, and we instituted an inter partes review. In Case
`IPR2013-00092, Sony Corporation of America (Petitioner in this
`proceeding), Axis Communications AB, and Axis Communications Inc.
`challenged claims 6, 8, and 9 based on certain prior art, including Woodmas,
`and we denied institution. In Case IPR2013-00385, Dell Inc. challenged
`claims 6 and 9 based on the same grounds as Avaya, and we instituted a
`review and joined the proceeding with the -71 Case. In Case
`IPR2013-00386, Sony Corporation of America, Axis Communications AB,
`Axis Communications Inc., and Hewlett-Packard Company challenged
`claims 6, 8, and 9, and we denied institution and joinder with the -71 Case.
`In Case IPR2013-00495, Sony Corporation of America and Hewlett-Packard
`Company challenged claims 6 and 9 based on the same grounds as Avaya
`and Dell, and we instituted a review and joined the proceeding with the -71
`Case. On May 22, 2014, we entered a final written decision in the -71 Case
`concluding that claims 6 and 9 had not been shown to be unpatentable. The
`decision is currently on appeal.
`
`
`
`6
`
`
`
`CBM2015-00078
`Patent 6,218,930 B1
`
`
`The ’930 patent also has been the subject of two ex parte
`reexaminations. In Reexamination Control No. 90/012,401, which was
`stayed pending resolution of the -71 Case, the Office confirmed the
`patentability of claims 6, 8, and 9, as well as new claims 10–23 added to the
`’930 patent during the reexamination. The corresponding reexamination
`certificate (Ex. 1008) issued on October 14, 2014. In Reexamination
`Control No. 90/013,444, Sony Corporation of America filed a request for
`ex parte reexamination concurrently with its Petition in this proceeding,
`based on the prior art references asserted in this proceeding and additional
`prior art. See Pet. 3. The Office granted the request on April 3, 2015, and
`the reexamination is ongoing.
`
`
`II. DISCUSSION
`The parties raise a number of preliminary issues in their papers,
`including (1) whether Petitioner is estopped under 35 U.S.C. § 315(e)(1)
`from challenging claims 6 and 9 based on the final written decision in the
`-71 Case, (2) whether the Petition should be denied under 35 U.S.C.
`§ 325(d) because it allegedly presents the same or substantially the same
`prior art or arguments as in Petitioner’s earlier petitions, and (3) whether the
`’930 patent is a “covered business method patent” eligible for covered
`business method patent review. See Pet. 11–27; Prelim. Resp. 4–62. We
`need not address the first two issues, however, because Petitioner has not
`established that the ’930 patent is a covered business method patent.
`Section 18 of the Leahy-Smith America Invents Act, Pub. L. No.
`112-29, 125 Stat. 284 (2011) (“AIA”), provides for the creation of a
`transitional program for reviewing covered business method patents, and
`
`
`
`7
`
`
`
`CBM2015-00078
`Patent 6,218,930 B1
`
`limits reviews to persons or their privies that have been sued or charged with
`infringement of a “covered business method patent,” which does not include
`patents for “technological inventions.” AIA §§ 18(a)(1)(B), 18(d)(1); see
`37 C.F.R. § 42.302. Petitioner bears the burden of demonstrating that the
`’930 patent is a covered business method patent. See 37 C.F.R. § 42.304(a).
`A “covered business method patent” is “a patent that claims a method
`or corresponding apparatus for performing data processing or other
`operations used in the practice, administration, or management of a financial
`product or service, except that the term does not include patents for
`technological inventions.” AIA § 18(d)(1) (emphasis added); see 37 C.F.R.
`§ 42.301(a). In promulgating rules for covered business method patent
`reviews, the Office considered the legislative intent and history behind the
`AIA’s definition of “covered business method patent.” See Transitional
`Program for Covered Business Method Patents—Definitions of Covered
`Business Method Patent and Technological Invention; Final Rule, 77 Fed.
`Reg. 48,734, 48,735–36 (Aug. 14, 2012) (“CBM Rules”). The “legislative
`history explains that the definition of covered business method patent was
`drafted to encompass patents ‘claiming activities that are financial in nature,
`incidental to a financial activity or complementary to a financial activity.’”
`Id. at 48,735 (emphasis added) (citing 157 Cong. Rec. S5432 (daily ed. Sept.
`8, 2011) (statement of Sen. Schumer)). When determining whether a patent
`is eligible for covered business method patent review, the focus is on “what
`the patent claims.” Id. at 48,736. A patent need have only one claim
`directed to a covered business method to be eligible for review. Id.
`Petitioner cites claim 23 and makes four arguments in support of its
`contention that the ’930 patent is a covered business method patent. Pet.
`
`
`
`8
`
`
`
`CBM2015-00078
`Patent 6,218,930 B1
`
`11–19. First, Petitioner argues that claim 23 is “broad enough to cover a
`financial product or service” because it covers “remote equipment, which
`includes a variety of financial products and products incidental or
`complementary to financial activities.” Id. at 13–14. We disagree. Claim
`23 recites a method of remotely powering access equipment in an Ethernet
`data network, where the method comprises the steps of (a) providing an
`access device (e.g., a Voice over IP (VoIP) telephone), (b) connecting the
`access device to a data signaling pair and data node (e.g., an Ethernet
`switch), (c) receiving a low level current at the access device, (d) producing
`a voltage level on the data signaling pair in response to the low level current,
`and (e) receiving controlled power at the access device in response to a
`preselected condition of the voltage level. The claim recites a specific way
`of providing remote power to an access device using a “low level current”
`and “preselected condition” of a resulting voltage level. Petitioner does not
`point to—and we do not find—any language in claim 23 relating to a
`financial product or service.
`Nor does Petitioner cite any language in the Specification of the ’930
`patent relating to a financial product or service. Rather, Petitioner only cites
`a statement in the Background of the Invention that “[t]he desire to add
`remotely powered devices to a data network is being pushed by the
`convergence of voice and data technologies.” Ex. 1001, col. 1, ll. 33–35;
`see Pet. 13. We do not see how this statement relates to financial products
`or services, or how it supports Petitioner’s position that claim 23 recites data
`processing or other operations used in the practice, administration, or
`management of a financial product or service, as required by § 18(d)(1) of
`
`
`
`9
`
`
`
`CBM2015-00078
`Patent 6,218,930 B1
`
`the AIA. We have reviewed the remainder of the Specification as well and
`find no mention of anything pertaining to a financial product or service.
`Second, Petitioner argues that the ’930 patent is a covered business
`method patent because claim 23 “covers a large number of PoE
`[Power-over-Ethernet] devices used in retail services.” Pet. 14–17.
`Petitioner cites documents and web pages purportedly describing devices
`(at least some of which Patent Owner allegedly has accused of infringing
`claims of the ’930 patent) that use PoE, such as video surveillance systems
`for retail point-of-sale terminals, point-of-sale credit card equipment, and
`radio frequency identification (RFID) readers used by retailers for inventory
`control and supply chain management. Id. (citing Exs. 1010–19). From this
`documentation, Petitioner draws various broad conclusions, including that
`“claim 23 covers a financial service—transaction data analysis,” and that the
`’930 patent “covers all aspects of the retail industry: from day-to-day
`front-end operations—sales and credit card transactions, and monitoring of
`store operation—to the back-end of inventory control and supply chain
`management.” Id.
`Petitioner’s argument is not persuasive. The fact that certain devices
`may be equipped for PoE does not mean that claim 23 “covers” activities
`like transaction data analysis, inventory control, or supply chain
`management. Claim 23 is concerned solely with providing remote power to
`an access device and how that remote powering is accomplished. Again, the
`focus of our inquiry is on the claims and whether the ’930 patent claims a
`method of performing data processing or other operations used in the
`practice, administration, or management of a financial product or service.
`See AIA § 18(d)(1); CBM Rules, 77 Fed. Reg. at 48,736. Claim 23
`
`
`
`10
`
`
`
`CBM2015-00078
`Patent 6,218,930 B1
`
`describes a method of remotely powering access equipment, without any
`particular connection to financial products or services. See, e.g., Sega of
`Am., Inc. v. Uniloc USA, Inc., Case CBM2014-00183, slip op. at 11–13
`(PTAB Mar. 10, 2015) (Paper 11) (claims were “directed to technology that
`restricts the use of software” where the software had “no particular
`relationship to a financial product or service”); Salesforce.com, Inc. v.
`Applications in Internet Time LLC, Case CBM2014-00162, slip op. at 9–10
`(PTAB Feb. 2, 2015) (Paper 11) (“the claims on their face are directed to
`technology common in business environments across sectors with no
`particular relationship to the financial services sector”) (citation and
`quotation marks omitted); J.P. Morgan Chase & Co. v. Intellectual Ventures
`II LLC, Case CBM2014-00160, slip op. at 6–12 (PTAB Jan. 29, 2015)
`(Paper 11) (claims pertaining to secure electronic communications had
`“general utility not limited or specific to any application”); PNC Fin. Servs.
`Group, Inc. v. Intellectual Ventures I LLC, Case CBM2014-00032, slip op.
`at 6–15 (PTAB May 22, 2014) (Paper 13) (claims described “software
`systems that have general utility not specific to any application”).
`Third, similar to its argument based on the use of PoE in retail
`services, Petitioner contends that claim 23 “covers a large number of PoE
`devices used in banking and financial services.” Pet. 18. For example,
`Petitioner argues that two alleged licensees of the ’930 patent use PoE in
`their bank kiosks and financial trading products. Id. (citing Exs. 1020–21).
`Petitioner further asserts that Patent Owner “broadly asserts that any PoE
`device infringes the ’930 patent.” Id. (citing Ex. 1002). Again, the fact that
`PoE-equipped devices may have uses other than receiving remote power,
`such as uses pertaining to banking, does not mean that claim 23 “covers”
`
`
`
`11
`
`
`
`CBM2015-00078
`Patent 6,218,930 B1
`
`such activities. Petitioner’s position, in essence, would mean that any patent
`claiming something that can be used in connection with a financial service
`(e.g., an Ethernet cable, a generic computer monitor, or even a ballpoint pen)
`would be eligible for covered business method patent review, regardless of
`what the patent claims. We are not persuaded that Petitioner’s position is
`consistent with the statutory language, which requires us to focus on what
`the challenged patent claims.
`Fourth, Petitioner argues that the definition of “covered business
`method patent” should be interpreted broadly, and cites a statement in the
`legislative history of the AIA that “‘if a patent holder alleges that a financial
`product or service infringes its patent, that patent shall be deemed to cover a
`‘financial product or service’ for purposes of this amendment regardless of
`whether the asserted claims specifically reference the type of product o[r]
`service accused of infringing.’” Id. at 11–12 (citing 157 Cong Rec. S1365
`(daily ed. Mar. 8, 2011) (statement of Sen. Schumer) (Ex. 1023)).
`According to Petitioner, Patent Owner has asserted in related district court
`cases that the claims of the ’930 patent “are infringed in conducting financial
`activities.” Id. at 12. Although we agree that the definition of “covered
`business method patent” should be interpreted broadly, the statute requires
`that we focus on what the challenged patent claims, and the legislative
`history reflects that focus. See AIA § 18(d)(1); CBM Rules, 77 Fed. Reg. at
`48,735–36; 157 Cong. Rec. S5432 (daily ed. Sept. 8, 2011) (statement of
`Sen. Schumer) (“section 18 is intended to cover not only patents claiming
`the financial product or service itself, but also patents claiming activities that
`are financial in nature, incidental to a financial activity or complementary to
`a financial activity”) (emphasis added); 157 Cong. Rec. S5441 (daily ed.
`
`
`
`12
`
`
`
`CBM2015-00078
`Patent 6,218,930 B1
`
`Sept. 8, 2011) (statement of Sen. Leahy) (stating that the definition is not
`intended to cover “technologies common in business environments across
`sectors and that have no particular relation to the financial services sector,
`such as computers, communications networks, and business software”).
`Moreover, even if Petitioner’s view of the statute is correct, we are not
`persuaded that Patent Owner has accused financial products or services of
`infringing the claims of the ’930 patent. Rather, as Patent Owner points out,
`it has accused “Ethernet data nodes (such as switches and hubs) and Ethernet
`powered devices (such as IP telephones and wireless access points).” See
`Prelim. Resp. 39 (citing Ex. 2009).
`For the foregoing reasons, based on the present record and particular
`facts of this proceeding, we determine that the information presented in the
`Petition does not establish that the ’930 patent qualifies as a “covered
`business method patent” under § 18(d)(1) of the AIA. Therefore, we do not
`institute a covered business method patent review on any of the asserted
`grounds as to any of the challenged claims.
`
`
`III. ORDER
`In consideration of the foregoing, it is hereby:
`ORDERED that the Petition is denied as to all challenged claims of
`the ’930 patent.
`
`
`
`13
`
`
`
`CBM2015-00078
`Patent 6,218,930 B1
`
`PETITIONER:
`
`Lionel M. Lavenue
`Theresa Weisenberger
`FINNEGAN, HENDERSON, FARABOW, GARRETT & DUNNER, LLP
`lionel.lavenue@finnegan.com
`theresa.weisenberger@finnegan.com
`
`PATENT OWNER:
`
`Charles F. Wieland III
`Robert G. Mukai
`BUCHANAN INGERSOLL & ROONEY PC
`Charles.Wieland@bipc.com
`robert.mukai@bipc.com
`
`
`
`
`
`
`
`14
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