IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`COMPASS BANK, AMERICAN EXPRESS COMPANY, AMERICAN
`EXPRESS TRAVEL RELATED SERVICES COMPANY, INC.,
`DISCOVER FINANCIAL SERVICES, DISCOVER BANK, DISCOVER
`PRODUCTS INC., NAVY FEDERAL CREDIT UNION, AND STATE
`FARM MUTUAL AUTOMOBILE INSURANCE COMPANY
`Petitioner,
`v.
`
`MAXIM INTEGRATED PRODUCTS, INC.
`Patent Owner.
`
`Case No. To Be Assigned
`Patent No. 6,237,095
`
`
`
`PETITION FOR COVERED BUSINESS METHOD PATENT REVIEW
`UNDER 35 U.S.C. §§ 321-329 AND § 18 OF THE LEAHY-SMITH
`AMERICA INVENTS ACT
`
`
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`
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`

`
`
`
`TABLE OF CONTENTS
`
`Page
`
`II. 
`III. 
`
`b. 
`
`(ii) 
`
`TABLE OF CONTENTS ........................................................................................................ i 
`TABLE OF AUTHORITIES ................................................................................................ iii 
`LIST OF EXHIBITS ............................................................................................................... vi 
`I. 
`MANDATORY NOTICES (37 C.F.R. § 42.8(a)(1)) ............................................... 1 
`A. 
`Real Party-In-Interest (37 C.F.R. § 42.8(b)(1)) .............................................. 1 
`B. 
`Related Matters (37 C.F.R. § 42.8(b)(2)) ......................................................... 1 
`C. 
`Lead and Backup Counsel (37 C.F.R. § 42.8(b)(3)) and Service
`Information (37 C.F.R. § 42.8(b)(4)) ............................................................... 4 
`FEES (37 C.F.R. § 42.203) ........................................................................................... 4 
`INTRODUCTION TO THE 095 PATENT .......................................................... 5 
`A.  Overview of the 095 Patent ............................................................................. 5 
`B. 
`095 Patent Prosecution History Summary ..................................................... 6 
`IV.  REQUIREMENTS FOR CBM REVIEW UNDER 37 C.F.R. § 42.304 ............ 8 
`A.  Grounds for Standing (37 C.F.R. § 42.304(a)) .............................................. 8 
`1. 
`Eligibility Requirements of 37 C.F.R. § 42.302 ................................. 8 
`2. 
`Timing Requirements of 37 C.F.R. § 42.303 ..................................... 9 
`3. 
`The 095 Patent is a Covered Business Method Patent .................... 9 
`a. 
`The Challenged Claims Are Directed to a “Financial
`Product or Service” .................................................................. 11 
`The Challenged Claims Are Not Directed to a
`“Technological Invention” ..................................................... 15 
`(i) 
`The Patent Does Not Recite a Technological
`Feature That is Novel and Unobvious ...................... 15 
`The Patent Does Not Solve a Technical
`Problem Using a Technical Solution ......................... 19 
`Citation of Prior Art ........................................................................................ 21 
`Claims and Statutory Grounds (37 C.F.R. §§ 42.304(b)(1) &
`(b)(2)) ................................................................................................................. 21 
`Claim Construction (37 C.F.R. § 42.104(b)(3)) ........................................... 22 
`Person of Ordinary Skill in the Art ............................................................... 29 
`Unpatentability of the Construed Claims (37 C.F.R. §
`42.304(b)(4)) ...................................................................................................... 29 
`Supporting Evidence (37 C.F.R. § 42.304(b)(5)) ......................................... 29 
`G. 
`AT LEAST ONE CLAIM OF THE 095 PATENT IS
`UNPATENTABLE .................................................................................................... 30 
`A. 
`Prior art .............................................................................................................. 30 
`1. 
`Hawkes (Ex. 1003) ............................................................................... 30 
`
`B. 
`C. 
`
`D. 
`E. 
`F. 
`
`V. 
`
`
`
`i
`
`

`
`
`
`B. 
`
`2. 
`Chaum (Ex. 1004) ................................................................................ 35 
`Ciarcia (Ex. 1005) ................................................................................. 36 
`3. 
`Brown (Ex. 1006) ................................................................................. 36 
`4. 
`Ingalls (Ex. 1007) ................................................................................. 37 
`5. 
`Ground I: Hawkes Alone or in Combination with One or More
`of Chaum and/or Ciarcia Renders Obvious Claims 1-2, 4-8 Under
`35 U.S.C. § 103 ................................................................................................. 38 
`Ground II: Claim 3 is Obvious Under 35 U.S.C. § 103 in Light of
`Hawkes Alone or in Combination with One or More of Brown
`and/or Ingalls ................................................................................................... 71 
`VI.  CONCLUSION........................................................................................................... 76 
`
`C. 
`
`
`
`ii
`
`
`
`
`
`

`
`
`
`CASES
`
`TABLE OF AUTHORITIES
`
`Applied Medical Resources Corp. v. U.S. Surgical Corp.,
`448 F.3d 1324 (Fed. Cir. 2006) ........................................................................................ 26
`
`Agilysys, Inc. v. Ameranth, Inc.,
`CBM2014-14, Paper 19 ....................................................................................... 13, 15, 20
`
`Apple Inc. v. SightSound Techs., LLC,
`CBM2013-20, Paper 14 .................................................................................................... 11
`
`Apple Inc. v. SightSound Techs., LLC,
`CBM2013-21, Paper 13 ............................................................................................. 12, 16
`
`Bloomberg Inc. v. Markets-Alert PTY Ltd.,
`CBM2013- 5, Paper 18 ..................................................................................................... 19
`
`CRS Advanced Techs., Inc. v. Frontline Techs., Inc.,
`CBM2012-5, Paper 17 .......................................................................................... 11, 13, 16
`
`Experian Mktg. Solutions, Inc. v. RPost Commc’n Ltd.,
`CBM2014-10, Paper 20 .................................................................................................... 14
`
`Glaxo Grp. Ltd. v. Ranbaxy Pharm., Inc.,
`262 F.3d 1333 (Fed. Cir. 2001) ........................................................................................ 13
`
`Google, Inc. v. Inventor Holdings, LLC,
`CBM2014-2, Paper 16 ....................................................................................................... 11
`
`In re Cuozzo Speed Techs., LLC,
`No. 2014-1301, 2015 WL 448667 (Fed. Cir. Feb. 4, 2015) ......................................... 22
`
`In re Translogic Tech., Inc.,
`504 F.3d 1249 (Fed. Cir. 2007) ........................................................................................ 22
`
`JP Morgan Chase & Co. and JP Morgan Chase Bank, N.A. v. Maxim,
`CBM2014-179, Paper 11 .......................................................................................... passim
`
`Phillips v. AWH Corp.,
`415 F.3d 1303 (Fed. Cir. 2005) (en banc) ...................................................................... 22
`
`
`
`iii
`
`

`
`
`
`PNC Fin. Servs. Grp., Inc. v. Intellectual Ventures I LLC, CBM2014-32,
`Paper 13 .............................................................................................................................. 14
`
`SAP Am., Inc. v. Versata Dev. Grp., Inc.,
`CBM2012-1, Paper 36 ....................................................................................................... 12
`
`Volusion, Inc., v. Versata Software, Inc.,
`CBM2013-18, Paper 8 ....................................................................................................... 12
`
`STATUTES
`
`35 U.S.C. § 102(b)................................................................................................ 21, 30, 36, 37
`
`35 U.S.C. § 102(e) ............................................................................................................. 21, 35
`
`35 U.S.C. § 103 ................................................................................................................. passim
`
`35 U.S.C. § 321(c) ...................................................................................................................... 9
`
`35 U.S.C. § 324(a) .................................................................................................................... 30
`
`35 U.S.C. § 325(a)(1) ................................................................................................................. 8
`
`35 U.S.C. § 325(e)(1) ................................................................................................................. 8
`
`35 U.S.C. § 328(a) ...................................................................................................................... 8
`
`OTHER AUTHORITIES
`
`37 C.F.R. § 42.8(a)(1) ................................................................................................................ 1
`
`37 C.F.R. § 42.8(b)(1) ................................................................................................................ 1
`
`37 C.F.R. § 42.8(b)(2) ................................................................................................................ 1
`
`37 C.F.R. § 42.8(b)(3) ................................................................................................................ 4
`
`37 C.F.R. § 42.8(b)(4) ................................................................................................................ 4
`
`37 C.F.R. § 42.15(b) .................................................................................................................. 4
`
`37 C.F.R. § 42.203 ..................................................................................................................... 4
`
`37 C.F.R. § 42.300(b) .............................................................................................................. 22
`
`37 C.F.R. § 42.301(a) ............................................................................................................... 11
`
`
`
`iv
`
`

`
`
`
`37 C.F.R. § 42.301(b) ....................................................................................................... 15, 20
`
`37 C.F.R. § 42.302 ..................................................................................................................... 8
`
`37 C.F.R. § 42.303 ..................................................................................................................... 9
`
`37 C.F.R. § 42.304 ..................................................................................................................... 8
`
`37 C.F.R. § 42.304(a) ................................................................................................................. 8
`
`37 C.F.R. §§ 42.304(b)(1) & (b)(2) ........................................................................................ 21
`
`37 C.F.R. § 42.304(b)(3) ......................................................................................................... 22
`
`37 C.F.R. § 42.304(b)(4) ......................................................................................................... 29
`
`37 C.F.R. § 42.304(b)(5) ......................................................................................................... 29
`
`Encyclopedia of Computer Science & Engineering ................................................... 27, 29
`
`Office Patent Trial Practice Guide,
`77 Fed. Reg. 48,734 (Aug. 14, 2012) ....................................................................... passim
`
`Statement of Sen. Schumer,
`157 Cong. Rec. S1364–65 (daily ed. Mar. 8, 2011) ....................................................... 12
`
`
`
`
`
`
`
`
`
`v
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`

`
`
`
`LIST OF EXHIBITS
`
`Description
`Exhibit
`Ex. 1001 U.S. Patent No. 6,237,095 (“095 Patent”)
`Ex. 1002
`File History for U.S. Patent No. 6,237,095
`Ex. 1003
`INTEGRATED CIRCUIT CARDS, TAGS AND TOKENS (P.L.
`Hawkes et al. eds., 1990) (collectively, “Hawkes”):
` P.L. Hawkes, Preface (“Hawkes Preface”);
` P.L. Hawkes, Introduction to Integrated Circuit Cards, Tags and Tokens
`for Automatic Identification (“Hawkes Ch. 1”);
` David Eglise, Electronic Coins (“Hawkes Ch. 5”);
` W.L. Price & B.J. Chorley, Secure Transactions with an Intelligent Token
`(“Hawkes Ch. 6”); and
` D.W. Davies, Cryptography and the Smart Card
`(“Hawkes Ch. 8”)
`Ex. 1004 U.S. Patent No. 5,485,520 (“Chaum”)
`Steve Ciarcia, Ciarcia’s Circuit Cellar: Build the BASIC-52
`Ex. 1005
`Computer/Controller, BYTE MAGAZINE (“Ciarcia”)
`John Forrest Brown, Embedded Systems Programming in C and
`Assembly (1994) (“Brown”)
`Ex. 1007 Daniel H.H. Ingalls, Design Principles Behind Smalltalk, BYTE
`MAGAZINE (“Ingalls”)
`Ex. 1008 Texas Instruments, TMS7000 Family Microarchitecture, User’s Guide,
`November 1982
`Fernando Flischfisch et al, A Survey of the Electronic Payment Industry (Mar.
`12, 1994), http://web.mit.edu/ecom/Spring1997/gr5/epayment.htm
`Ex. 1010 Douglass Reilly, Programmer’s Bookshelf – Book review of John Forrest
`Brown, Embedded Systems Programming in C and Assembly, Dr.
`Dobb’s Journal, Nov. 1, 1994
`Ex. 1011 Decision Institution re U.S. Patent No. 5,940,510, JPMorgan Chase & Co.
`and JP Morgan Chase Bank, N.A., v. Maxim Integrated Products, Inc., CBM
`2014-179, Paper No. 11, February 20, 2015
`Petition for Covered Business Method Patent Review Under 35 U.S.C. §§
`321-329 and § 18 of the Leahy-Smith America Invents Act, Case
`CBM2014-177, JP Morgan Chase & Co., and JP Morgan Chase Bank,
`N.A. (“Chase”)
`Ex. 1013 Declaration of Stephen D. Bristow in support of Chase Petition for
`Covered Business Method Review of U.S. Patent No. 6,237,095
`Special Master’s Report and Recommendation re Claim Construction, In
`re Maxim Integrated Products, Inc., Patent Litigation, No. 2:12-mc-00244-JFC
`
`Ex. 1006
`
`Ex. 1009
`
`Ex. 1012
`
`Ex. 1014
`
`
`
`vi
`
`

`
`
`
`Exhibit
`
`Description
`(W.D. Pa.), Docket #691, (10/09/2013) (“R&R”)
`Ex. 1015 Corrective Entry to Special Master’s Report and Recommendation re
`Claim Construction, In re Maxim Integrated Products, Inc., Patent Litigation,
`No. 2:12-mc-00244-JFC (W.D. Pa.), Docket #693, (10/15/2013) (“R&R
`Correction”)
`Ex. 1016 Memorandum Opinion re Special Master’s Report and Recommendation
`re Claim Construction, In re Maxim Integrated Products, Inc., Patent
`Litigation, No. 2:12-mc-00244-JFC (W.D. Pa.), Docket #742,
`(12/17/2013) (“CC Op.”)
`“Object-Oriented Programming,” Encyclopedia of Computer Science &
`Engineering (3rd ed. 1993)
`First Amended Complaint in Maxim Integrated Prods., Inc. v. Compass Bank,
`d/b/a BBVA Compass, No. 5:14-cv-1028-XR (W.D. Tx.), D.I. 20
`(2/16/2015)
`Ex. 1019 Declaration of Peter Alexander, Ph.D. (“Alexander Decl.”)
`Ex. 1020 Curriculum Vitae of Peter Alexander, Ph.D.
`
`
`Ex. 1017
`
`Ex. 1018
`
`
`
`vii
`
`

`
`
`
`I. MANDATORY NOTICES (37 C.F.R. § 42.8(a)(1))
`A. Real Party-In-Interest (37 C.F.R. § 42.8(b)(1))
`
`The real parties in interest for this petition for Covered Business Method
`
`patent (“CBM”) review are Compass Bank, American Express Company, American
`
`Express Travel Related Services Company, Inc., Discover Financial Services, Discover
`
`Bank, Discover Products Inc., Navy Credit Federal Credit Union, and State Farm
`
`Mutual Automobile Insurance Company (collectively, “Petitioner”).
`
`B. Related Matters (37 C.F.R. § 42.8(b)(2))
`
`U.S. Patent No. 6,237,095 (Ex. 1001) (“095 Patent”), owned by Maxim
`
`Integrated Products, Inc. (“Maxim”), is currently asserted against multiple defendants
`
`in the Western District of Texas (collectively, “WD Tx Litigations”):
`
` Maxim v. The American Express Company and American Express Travel Related
`Services Company, Inc., No. 5:14-cv-1027-XR (W.D. Tx.)
` Maxim v. Compass Bank d/b/a BBVA Compass, No. 5:14-cv-1028-XR
`(W.D. Tx.)
` Maxim v. Discover Financial Services, No. 5:14-cv-1029-XR (W.D. Tx.)
` Maxim v. State Farm Mutual Automobile Insurance Company, No. 5:14-cv-
`1030-XR (W.D. Tx.)
` Maxim v. USAA Federal Savings Bank, No. 5:14-cv-1031-XR (W.D. Tx.)
` Maxim v. Navy Federal Credit Union, No. 5:14-cv-1032-XR (W.D. Tx.)
`
`
`
`The 095 Patent has also been asserted in cases consolidated into multidistrict
`
`litigation as In re: Maxim Integrated Prods., Inc. MDL No. 2354, Misc. No. 12-244-JFC
`
`
`
`1
`
`

`
`
`
`(W.D. Pa.) (“MDL Litigation”). Claims of the 095 Patent were construed by the
`
`district court in the MDL Litigation. A special master issued a claim construction
`
`report and recommendation (Ex. 1014) (hereinafter “R&R”) and a correction to that
`
`report (Ex. 1015) (hereinafter “R&R Correction”), which the district court adopted in
`
`part and overruled in part in a claim construction opinion (Ex. 1016) (hereinafter “CC
`
`Op.”). As of the filing date of this Petition, all but one of the MDL cases (Branch
`
`Banking & Trust Co. v. Maxim) has been terminated as indicated below:
`
`Active (W.D. Pa.)
` Branch Banking & Trust Co. v. Maxim, No. 2:12-cv-945-JFC
`
`Terminated (W.D. Pa.)
` PNC Fin. Servs. Grp., Inc. v. Maxim, No. 2:12-cv-89-JFC
` KeyCorp v. Maxim, No. 2:12-cv-860-JFC
` Vanguard Grp., Inc. v. Maxim, No. 2:12-cv-862-JFC
` Jack Henry & Assocs., Inc. v. Maxim, No. 2:12-cv-863- JFC
` Maxim v. Comerica Inc., No. 2:12-cv-869-JFC
` Fidelity Brokerage Servs. LLC v. Maxim, No. 2:12-cv-871-JFC
` Maxim v. First United Bank & Trust Co., No. 2:12-cv-876-JFC
` Maxim v. Starbucks Corp., No. 2:12-cv-877-JFC
` Maxim v. Expedia, Inc., No. 2:12-cv-878-JFC
` Maxim v. Capital One Fin. Corp., No. 2:12-cv-879- JFC
` Maxim v. Bank of the West, No. 2:12-cv-880-JFC
` Maxim v. Groupon, Inc., No. 2:12-cv-881-JFC
` Maxim v. Union Bank, N.A., No. 2:12-cv-882-JFC
` Maxim v. Southwest Airlines, Co., No. 2:12-cv-883- JFC
`
`
`
`2
`
`

`
`
`
`
`
` Chipotle Mexican Grill, Inc. v. Maxim, No. 2:12-cv-887-JFC
` Maxim v. QVC, Inc., No. 2:12-cv-891-JFC
` Clairmail Inc. v. Maxim, No. 2:12-cv-923-NBF
` BMO Harris Bank Nat’l Ass’n v. Maxim, No. 2:12-cv-1538-JFC
` Deutsche Bank AG v. Maxim, No. 2:12-cv-1604-JFC
` Maxim v. Citigroup, Inc., No. 2:12-cv-1628-JFC
` Maxim v. Target Corp., No. 2:12-cv-1629-JFC
` Maxim v. Wells Fargo & Co., No. 2:12-cv-1639-JFC
` Maxim v. Bank of Am. Corp., No. 2:12-cv-1640-JFC
` Maxim v. U.S. Bancorp, No. 2:12-cv-1642-JFC
` Maxim v. Walmart Stores, Inc., No. 2:12-cv-1643-JFC
` Maxim v. JP Morgan Chase & Co. and JP Morgan Chase Bank, N.A.
`(collectively, “Chase”), No. 2:12-cv-1641-JFC
`
`The 095 Patent claims priority to Provisional Application No. 60/004,510, filed
`
`September 29, 1995, and U.S. Patent No. 6,105,013 (“013 Patent”) claims priority to
`
`the same application. Petitioner filed a CBM petition against the 013 Patent on March
`
`23, 2013 and it was assigned Case No. CBM2015-101.
`
`
`
`The 095 Patent is related to Application No. 08/594,975, filed January 31,
`
`1996, now U.S. Patent No. 5,940,510 (“510 Patent”). See 095 Patent 1:18-20 (citing the
`
`510 Patent application as “related subject matter”). Petitioner filed a CBM petition
`
`against the 510 Patent on March 6, 2015 and it was assigned Case No. CBM2015-98.
`
`Previously, Chase filed a CBM petition against the 510 Patent on August 21,
`
`2014. JP Morgan Chase & Co. and JP Morgan Chase Bank, N.A. v. Maxim, CBM2014-179,
`
`
`
`3
`
`

`
`
`
`Paper 1. The Board instituted review of the 510 Patent on February 20, 2015. Chase,
`
`CBM2014-179, Paper 11. However, five days after the Board instituted review, Chase
`
`and Maxim filed a joint motion to terminate the proceeding because they reached a
`
`settlement agreement. Chase, CBM2014-179, Paper 13. The Board granted the joint
`
`motion on February 27, 2015 and terminated the 510 Patent CBM review due to
`
`settlement. Chase, CBM2014-179, Paper 15.
`
`C.
`
`Lead and Backup Counsel (37 C.F.R. § 42.8(b)(3)) and
`Service Information (37 C.F.R. § 42.8(b)(4))
`
`Lead Counsel
`William F. Long (Reg. No. 51,967)
`blong@mckennalong.com
`
`Postal and Hand-Delivery Address:
`McKenna Long & Aldridge LLP
`303 Peachtree St. NE, Ste. 5300
`Atlanta, Georgia 30308
`T: (404) 527-4000; F: (404) 527-4198
`
`Back-up Counsel
`David M. Tennant (Reg. No. 48,362)
`dtennant@whitecase.com
`Postal and Hand-Delivery Address:
`White & Case LLP
`701 13th St., NW Washington, DC
`20005
`T: (202) 626-3684; F: (202) 639-9355
`
`
`Additional counsel for Petitioner are listed in the signature block of the Petition.
`
`Service information for lead and back-up counsel is immediately above.
`
`II.
`
`FEES (37 C.F.R. § 42.203)
`
`The undersigned authorizes the Office to charge $30,000 ($12,000 request fee;
`
`and $18,000 post-institution fee) to Deposit Account No. 50-0911 for the fees set
`
`forth in 37 C.F.R. § 42.15(b) for this Petition. The undersigned further authorizes
`
`payment for any additional fees that might be due in connection with this Petition to
`
`be charged to the above referenced Deposit Account.
`
`
`
`4
`
`

`
`
`
`III.
`
`INTRODUCTION TO THE 095 PATENT
`A. Overview of the 095 Patent
`
`The 095 Patent, which claims priority to September 1995, relates to “an
`
`electronic module used for secure transactions” that “is capable of passing
`
`information back and forth between a service provider’s equipment via a secure,
`
`encrypted technique so that money and other valuable data can be securely passed
`
`electronically. The module is capable of being programmed, keeping track of real
`
`time, recording transactions for later review, and creating encryption key pairs.” 095
`
`Patent, Abstract. Claim 7 recites that the module performs money transactions
`
`wherein “[the] first data object includes a base monetary amount and wherein [the]
`
`second data object includes a transaction monetary amount.”
`
`Figure 1 of the 095 Patent
`
`(reproduced at left; color annotations
`
`added) shows the module’s components.
`
`095 Patent 2:6, 2:34-35, Fig. 1. The
`
`module contains a microprocessor 12
`
`(highlighted in purple), math coprocessor
`
`for encryption and decryption 18
`
`(highlighted in red), memory circuitry 20 (highlighted in blue), input/output circuit 26
`
`(highlighted in orange), real time clock 14 for time stamping (highlighted in green),
`
`and energy circuit 34 (highlighted in brown). Id. 2:39-42.
`
`
`
`5
`
`

`
`
`
`The 095 Patent’s module is “capable of being programmed” so it can run
`
`various applications. Id. Abstract, 3:10-17. The applications can be programmed into
`
`the module’s memory (ROM, EPROM, NVRAM, SRAM, or other types of memory)
`
`to configure the module to perform various functions. Id. 2:58-63, 3:27-30. For
`
`example, the module “can be configured to provide at least secure data transfers or to
`
`authorize monetary transactions.” Id. 1:25-28. The module may execute transactions
`
`by “passing encrypted information back and forth between [itself and] a service
`
`provider’s equipment via a secure, encrypted technique so that money and other
`
`valuable data can be securely passed electronically.” Id. Abstract. Further, the “module
`
`is capable of time stamping and storing in memory information about the transaction
`
`for later review.” Id. 1:65-67.
`
`The specification describes a “series of practical applications” (id. 4:59-63) for
`
`the claimed module, including inter alia, serving as a “Digital Cash Dispenser” (id.
`
`7:65) for “monetary transactions” (id. 9:13) and for “Digital Cash Replenishment”
`
`(10:27) in which the module is used as a “wallet” that can be “filled up” with currency
`
`or some other form of exchange, and used for payment (id. 7:65-8:19, 10:27-36).
`
`B.
`
`095 Patent Prosecution History Summary
`
`A number of responses and amendments are present in the file history of the
`
`095 Patent. Petitioner summarizes here the actions most relevant to the grounds of
`
`unpatentability set forth herein.
`
`
`
`6
`
`

`
`
`
`Claim 1 of the 095 Patent corresponds to application claim 21. Ex. 1002, Index
`
`of Claims, 7. The Examiner found this claim to be anticipated by the prior art. Id.,
`
`Office Action, 214-215 (Examiner applying U.S. Patent No. 5,577,121 to Davis et al.,
`
`which describes a transaction system for conducting a transaction between an
`
`integrated circuit card and a transaction terminal). Claim 3 of the 095 Patent
`
`corresponds to application claim 24. Id. at 7. This claim specifies the recited apparatus
`
`of Claim 1 is “programmable via object oriented software.” Id. at 163. The Examiner
`
`found this claim to be obvious twice based on official notice that “it is old and well
`
`known in the cryptographic programming art to program an electronic module using
`
`object oriented software . . . to gain the advantages of flexibility, encapsulation and
`
`inheritance that is associated with object oriented programming.” Id. at 193, 217.
`
`In response, the claim that issued as Claim 1 was amended to recite “a timing
`
`circuit connected to the microprocessor, the timing circuit for generating a time
`
`stamp,” and to recite that the instructions cause the microprocessor circuit to “store a
`
`transaction script, the transaction script including at least a representation of the time
`
`stamp generated by the timing circuit.” Id., Amendment, 221-25. Applicants did not
`
`address, let alone challenge, the Examiner’s obviousness rejection regarding the claim
`
`that issued as Claim 3 regarding “object oriented” programming. See id. at 223-25. The
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`Examiner allowed Claim 1, referencing the step to “store a transaction script” in the
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`statement of reasons for allowance. Id., Allowance, 235.
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`7
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`IV. REQUIREMENTS FOR CBM REVIEW UNDER 37 C.F.R. § 42.304
`A. Grounds for Standing (37 C.F.R. § 42.304(a))
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`Pursuant to 37 C.F.R. § 42.304(a), the 095 Patent is eligible for CBM review
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`(“CBMR”) because each Petitioner meets the eligibility requirements of 37 C.F.R. §
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`42.302 and the 095 Patent is a covered business method patent.
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`Moreover, each Petitioner is not estopped from maintaining the present
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`Petition. Congress specifically defined the circumstances under which a party may be
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`estopped from requesting or maintaining a post-grant review proceeding such as the
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`instant CBM Petition in 35 U.S.C. § 325(e)(1). Estoppel cannot arise under § 325(e)(1)
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`unless the Board previously issued a “final written decision under Section 328(a).” By
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`its terms, a final written decision under § 328(a) can exist only in cases where “a post-
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`grant review is instituted and not dismissed.” 35 U.S.C. § 328(a). Each Petitioner has
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`not been a petitioner to any post-grant review of the 095 Patent that has resulted in a
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`final written decision under 35 U.S.C. § 328(a) and is therefore not estopped from
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`filing the instant petition.
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`No Petitioner is barred by 35 U.S.C. § 325(a)(1) because each Petitioner has not
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`previously filed a civil action challenging the validity of the 095 Patent.
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`1.
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`Eligibility Requirements of 37 C.F.R. § 42.302
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`Each Petitioner, except for Discover Products Inc. (“DPI”), has been sued for
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`infringement of the 095 Patent in the WD Tx Litigations. DPI is a wholly owned
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`8
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`servicing subsidiary of Discover Bank, DPI’s real party in interest and privy. No
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`Petitioner is estopped from challenging the claims on the grounds identified herein.
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`2.
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`Timing Requirements of 37 C.F.R. § 42.303
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`The requirements of 35 U.S.C. § 321(c) cannot be met for the 095 Patent. As
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`such, a petition requesting CBM review of the 095 Patent may be filed at any time.
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`3.
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`The 095 Patent is a Covered Business Method Patent
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`As noted above, the 095 Patent is related to the 510 Patent and contains similar
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`subject matter. Previously, the Board ruled that the 510 Patent is a covered business
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`method patent. Chase, CBM2014-179, Paper 11 at 23. In reaching this decision, the
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`Board found dependent claim 2 of the 510 Patent, which recites that a “portable
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`module reader” in claim 1 of the 510 Patent can be connected to a plurality of other
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`devices including “a credit card reader, a cash machine, an automatic teller
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`machine, and a phone line,” to be “at a minimum, incidental or complementary to
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`financial activities and services performed by credit card readers, cash machines, and
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`automatic teller machines (“ATMs”), such as electronic payments and debits, or cash
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`transfers and withdrawals.” Id. at 17-18 (emphasis original). Further, the Board
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`concluded that the 510 Patent’s specification confirmed that Claim 2 of the 510
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`Patent involved financial activities, because the 510 specification stated the “portable
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`module reader” was for use with a “portable module” that stored a “cash equivalent,”
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`“electronic money,” or a “currency equivalent” and was for use in “electronic
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`9
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`financial activities and transactions, including transferring and withdrawing monetary
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`value, and paying for goods and services.” Id. at 18.
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`As with the 510 Patent, a challenged claim in the 095 Patent is directed to
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`digital transfers of a “monetary amount,” specifically Claim 7 requires a first data that
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`is “a base monetary amount” and a second data that is a “transaction monetary
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`amount,” which the 095 Patent’s specification confirms are electronic financial
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`transactions, including transferring and withdrawing monetary value, and paying for
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`goods and services. See 095 Patent 7:65-11:47 (the claimed “secure transaction
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`integrated circuit” can be used as a “Digital Cash Dispenser” for “monetary
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`transactions” and for “Digital Cash Replenishment” (10:27) where it is used as a
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`“wallet” that can be “filled up” with currency or some other form of exchange, and
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`used for payment), id. 7:65-8:5 (in an “exemplary usage model” the “Service Provider
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`is a bank or other financial institution, the End User is the bank’s customer who
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`wishes to use the [claimed] module [] to make purchases”).
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`The Board’s decision in Chase therefore strongly supports the conclusion that
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`the 095 Patent is also a covered business method review patent. See Chase, CBM2014-
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`179, Paper 11 at 16-18, 23. Such a conclusion is consistent with the AIA, USPTO
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`rules, and Board precedent. For example, the AIA and USPTO rules define a
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`“covered business method patent” as “a patent that claims a method or
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`corresponding apparatus for performing data processing or other operations used in
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`10
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`the practice, administration, or management of a financial product or service, except
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`that the term does not include patents for technological inventions.” AIA § 18(d)(1);
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`see also 37 C.F.R. § 42.301(a). The statutory scheme sets forth a two-part test to
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`determine whether a patent is eligible for CBMR: (1) the patent must claim a method
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`or apparatus for performing data processing or other operations used in the practice,
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`administration, or management of a financial product or service, and (2) the claimed
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`invention cannot be a technological invention. A patent need have only one claim
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`directed to a covered business method to be eligible for review, even if the patent
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`includes additional claims. Google, Inc. v. Inventor Holdings, LLC, CBM2014-2, Paper 16,
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`6 (citing 77 Fed. Reg. 48,734, 48,736 (Aug. 14, 2012)). The 095 Patent meets both
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`parts of the test and is thus eligible for CBMR.
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`a.
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`The Challenged Claims Are Directed to a “Financial
`Product or Service”
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`As noted above, the Board previously concluded that the related 510 Patent is
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`directed to a financial product or service. Chase, CBM2014-179, Paper 11 at 17-19, 23.
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`The same conclusion applies to the 095 Patent; in particular, to challenged Claim 7
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`which recites an apparatus for transfers of a “monetary amount.”
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`The Board has stated that “financial product or service” should be “interpreted
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`broadly.” Apple Inc. v. SightSound Techs., LLC, CBM2013-20, Paper 14 at 11. It
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`encompasses patents claiming “activities that are financial in nature, incidental to a
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`financial activity or complementary to a financial activity.” CRS Advanced Techs., Inc. v.
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`
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`11
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`
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`Frontline Techs., Inc., CBM2012-5, Paper 17, 7 (quoting 77 Fed. Reg. 48,735 (Aug. 14,
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`2012)). Patents are eligible for CBMR if they “cover any ancillary activities related to a
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`financial product or service, including . . . marketing, customer interfaces, Web site
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`management and functionality, transmission or management of data, servicing,
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`underwriting, customer communications, and back office operations-e.g., payment
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`processing, stock clearing.” Statement of Sen. Schumer, 157 Cong. Rec. S1364–65
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`(daily ed. Mar. 8, 2011).
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`The Board has explained that a patent that “relates to a co