Trials@uspto.gov
`Tel: 571-272-7822
`
`Paper 31
`Entered: November 7, 2016
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`APPLE INC.,
`Petitioner,
`
`v.
`
`SMARTFLASH LLC,
`Patent Owner.
`
`Case CBM2015-00123
`Patent 8,033,458 B2
`
`Before JENNIFER S. BISK, RAMA G. ELLURU,
`JEREMY M. PLENZLER, and MATTHEW R. CLEMENTS,
`Administrative Patent Judges.
`
`PLENZLER, Administrative Patent Judge.
`
`
`
`FINAL WRITTEN DECISION
`35 U.S.C. § 328(a) and 37 C.F.R. § 42.73
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`Tel: 571-272-7822
`
`Paper 31
`Entered: November 7, 2016
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`APPLE INC.,
`Petitioner,
`
`v.
`
`SMARTFLASH LLC,
`Patent Owner.
`
`Case CBM2015-00123
`Patent 8,033,458 B2
`
`Before JENNIFER S. BISK, RAMA G. ELLURU,
`JEREMY M. PLENZLER, and MATTHEW R. CLEMENTS,
`Administrative Patent Judges.
`
`PLENZLER, Administrative Patent Judge.
`
`
`
`FINAL WRITTEN DECISION
`35 U.S.C. § 328(a) and 37 C.F.R. § 42.73
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`CBM2015-00123
`Patent 8,033,458 B2
`
`A. Background
`
`INTRODUCTION
`
`Apple Inc. (“Petitioner”), filed a Petition to institute covered business
`
`method patent review of claims 2–5, 7, 9, and 12 of U.S. Patent No.
`
`8,033,458 B2 (Ex. 1001, “the ’458 patent”) pursuant to § 18 of the Leahy-
`
`Smith America Invents Act (“AIA”). Paper 2 (“Pet.”).1 Smartflash LLC
`
`(“Patent Owner”) filed a Preliminary Response. Paper 5 (“Prelim. Resp.”).
`
`On November 10, 2015, we instituted a covered business method patent
`
`review (Paper 7, “Institution Decision” or “Inst. Dec.”) based upon
`
`Petitioner’s assertion that claims 2–5, 7, 9, and 12 (“the challenged claims”)
`
`are directed to patent ineligible subject matter under 35 U.S.C. § 101 and
`
`that claims 3–5 are indefinite under 35 U.S.C. § 112, second paragraph.
`
`Inst. Dec. 23.
`
`Subsequent to institution, Patent Owner filed a Patent Owner
`
`Response (Paper 17, “PO Resp.”) and Petitioner filed a Reply (Paper 21,
`
`“Pet. Reply”) to Patent Owner’s Response.
`
`Patent Owner, with authorization, filed a Notice of Supplemental
`
`Authority. Paper 28 (“Notice”). Petitioner filed a Response to Patent
`
`Owner’s Notice. Paper 29 (“Notice Resp.”).
`
`We held a joint hearing of this case and several other related cases on
`
`July 18, 2016. Paper 30 (“Tr.”).
`
`We have jurisdiction under 35 U.S.C. § 6(c). This Final Written
`
`Decision is issued pursuant to 35 U.S.C. § 328(a) and 37 C.F.R. § 42.73.
`
`For the reasons that follow, we determine that Petitioner has shown by a
`
`preponderance of the evidence that claims 2–5, 7, 9, and 12 of the ’458
`
`
`1 Pub. L. No. 112–29, 125 Stat. 284, 296–07 (2011).
`
`2
`
`
`
`CBM2015-00123
`Patent 8,033,458 B2
`
`patent are directed to patent ineligible subject matter under 35 U.S.C. § 101
`
`and that claims 3–5 of the ’458 patent are indefinite under 35 U.S.C. § 112,
`
`second paragraph.
`
`B. Related Matters
`
`The parties indicate that the ’458 patent is the subject of the following
`
`district court cases: Smartflash LLC v. Apple Inc., Case No. 6:13-cv-447
`
`(E.D. Tex.); and Smartflash LLC et al. v. Apple Inc., Case No. 6:15-cv-
`
`00145 (E.D. Tex.). Pet. 34; Paper 4, 4–5. The parties also indicate that the
`
`’458 patent is the subject of a number of other district court cases, to which
`
`Petitioner is not a party. Pet. 34; Paper 4, 4.
`
`We have issued three previous Final Written Decisions in reviews
`
`challenging the ’458 patent. In CBM2014-00106, we found claim 1
`
`unpatentable under 35 U.S.C. § 103. Apple Inc. v. Smartflash LLC, Case
`
`CBM2014-00106, (PTAB Sept. 25, 2015) (Paper 52). In CBM2015-00016,
`
`we found claims 6, 8, and 10 unpatentable under 35 U.S.C. § 101 and claim
`
`11 unpatentable under 35 U.S.C. § 112, second paragraph.2 Apple Inc. v.
`
`Smartflash LLC, Case CBM2015-00016, (PTAB March 29, 2016) (Paper
`
`56). In CBM2014-00192, we found claim 11 unpatentable under 35 U.S.C.
`
`§ 101. Samsung Electronics America, Inc., Samsung Electronics Co., Ltd.,
`
`Samsung Telecommunications America, LLC, and Apple Inc. v. Smartflash
`
`LLC, CBM2014-00192, (March 30, 2016) (Paper 45).
`
`
`2 Trial was terminated with respect to the ground challenging claim 1 under
`35 U.S.C. § 101 in view of our decision in CBM2014-00106 finding that
`claim unpatentable under 35 U.S.C. § 103.
`
`3
`
`
`
`CBM2015-00123
`Patent 8,033,458 B2
`
`C. The ’458 Patent
`
`The ’458 patent relates to “a portable data carrier for storing and
`
`paying for data and to computer systems for providing access to data to be
`
`stored,” and the “corresponding methods and computer programs.”
`
`Ex. 1001, 1:21–25. Owners of proprietary data, especially audio recordings,
`
`have an urgent need to address the prevalence of “data pirates” who make
`
`proprietary data available over the internet without authorization. Id. at
`
`1:29–55. The ’458 patent describes providing portable data storage together
`
`with a means for conditioning access to that data upon validated payment.
`
`Id. at 1:59–2:11. This combination allows data owners to make their data
`
`available over the internet without fear of data pirates. Id. at 2:11–15.
`
`As described, the portable data storage device is connected to a
`
`terminal for internet access. Id. at 1:59–67. The terminal reads payment
`
`information, validates that information, and downloads data into the portable
`
`storage device from a data supplier. Id. The data on the portable storage
`
`device can be retrieved and output from a mobile device. Id. at 2:1–5.
`
`The ’458 patent makes clear that the actual implementation of these
`
`components is not critical and they may be implemented in many ways. See,
`
`e.g., id. at 25:49–52 (“The skilled person will understand that many variants
`
`to the system are possible and the invention is not limited to the described
`
`embodiments.”).
`
`D. Challenged Claims
`
`The claims under review are claims 2–5, 7, 9, and 12 of the ’458
`
`patent. Inst. Dec. 23. Of the challenged claims, claims 3, 4, and 5 are
`
`independent. Claim 2 depends from independent claim 1 (held unpatentable
`
`under § 103 in CBM2014-00106). Claims 7, 9, and 12 depend from
`
`4
`
`
`
`CBM2015-00123
`Patent 8,033,458 B2
`
`independent claim 6 (held unpatentable under § 101 in CBM2015-00016).
`
`Independent claims 3, 4, and 5 are illustrative and recite the following:
`
`3.
`
`A portable data carrier, comprising:
`
`an interface for reading and writing data from and to the
`carrier;
`
`non-volatile data memory, coupled to the interface, for
`storing data on the carrier;
`
`non-volatile payment data memory, coupled to the
`interface, for providing payment data to an external device;
`
`a program store storing code implementable by a
`processor;
`
`a processor, coupled to the content data memory, the
`payment data memory, the interface and to the program store
`for implementing code in the program store;
`
`non-volatile use record memory, coupled to the
`processor, for storing a record of access made to the data
`memory and code to update the use record memory in response
`to external access made to the data memory; and
`
`non-volatile use rule memory, coupled to the processor,
`for storing data use rules, and wherein the code comprises code
`for storing at least one data item in the data memory and at least
`one corresponding use rule in the use rule memory and code to
`provide external access to the data item in accordance with the
`use rule, wherein the code further comprises code to output
`payment data from the payment data memory to the interface
`and code to provide external access to the data memory.
`
`Ex. 1001, 26:10–35.
`
`4.
`
`A portable data carrier, comprising:
`
`an interface for reading and writing data from and to the
`carrier;
`
`non-volatile data memory, coupled to the interface, for
`storing data on the carrier;
`
`non-volatile payment data memory, coupled to the
`interface, for providing payment data to an external device;
`
`5
`
`
`
`CBM2015-00123
`Patent 8,033,458 B2
`
`a program store storing code implementable by a
`processor; and
`
`a processor, coupled to the content data memory, the
`payment data memory, the interface and to the program store
`for implementing code in the program store;
`
`wherein the portable data carrier is configured for storing
`supplementary data in said data memory, and further
`comprising code to output the supplementary data from the
`interface in addition to the stored data, in response to an
`external request to read the data memory, and
`
`wherein the code comprises code to output payment data
`from the payment data memory to the interface and code to
`provide external access to the data memory.
`
`Id. at 26:36–55.
`
`5.
`
`A portable data carrier, comprising:
`
`an interface for reading and writing data from and to the
`carrier;
`
`non-volatile data memory, coupled to the interface, for
`storing data on the carrier;
`
`non-volatile payment data memory, coupled to the
`interface, for providing payment data to an external device;
`
`a program store storing code implementable by a
`processor;
`
`a processor, coupled to the content data memory, the
`payment data memory, the interface and to the program store
`for implementing code in the program store; and
`
`synthesis code to receive a first portion of data from the
`interface and to combine the first portion with a second portion
`of data stored in the data memory and to store the result in the
`data memory
`
`wherein the code comprises code to output payment data
`from the payment data memory to the interface and code to
`provide external access to the data memory.
`
`Id. at 26:56–27:7.
`
`6
`
`
`
`CBM2015-00123
`Patent 8,033,458 B2
`
`A. Claim Construction
`
`ANALYSIS
`
`In a covered business method patent review, claim terms are given
`
`their broadest reasonable interpretation in light of the specification in which
`
`they appear and the understanding of others skilled in the relevant art. See
`
`37 C.F.R. § 42.300(b). Applying that standard, we interpret the claim terms
`
`of the ’458 patent according to their ordinary and customary meaning in the
`
`context of the patent’s written description. See In re Translogic Tech., Inc.,
`
`504 F.3d 1249, 1257 (Fed. Cir. 2007). For purposes of this Decision, we
`
`need not construe expressly any claim term.
`
`B. Statutory Subject Matter
`
`Petitioner challenges claims 2–5, 7, 9, and 12 as directed to patent-
`
`ineligible subject matter under 35 U.S.C. § 101. Pet. 41–71. Petitioner
`
`asserts that the challenged claims are directed to an abstract idea without
`
`additional elements that transform it into a patent-eligible application of that
`
`idea (id. at 42–67), triggers preemption concerns (id. at 67–70), and fails the
`
`machine-or-transformation test (id. at 70–71). Petitioner provides a
`
`declaration from John P.J. Kelly, Ph.D. to support its challenges.3 Ex. 1020
`
`(“the Kelly Declaration”). Patent Owner argues that the challenged claims
`
`are statutory because they are “rooted in computer technology in order to
`
`
`3 In its Response, Patent Owner argues that this declaration should be given
`little or no weight. PO Resp. 5–16. Because Patent Owner has filed a
`Motion to Exclude (Paper 24) that includes a request to exclude Dr. Kelly’s
`Declaration in its entirety, or in the alternative, portions of the declaration
`based on essentially the same argument, we address Patent Owner’s
`argument as part of our analysis of the motion to exclude, below.
`
`7
`
`
`
`CBM2015-00123
`Patent 8,033,458 B2
`
`overcome a problem specifically arising in the realm of computer networks,”
`
`that of “data content piracy.” PO Resp. 1–2.
`
`1. Abstract Idea
`
`Under 35 U.S.C. § 101, we must first identify whether an invention
`
`fits within one of the four statutorily provided categories of patent-
`
`eligibility: “processes, machines, manufactures, and compositions of
`
`matter.” Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 713–714 (Fed. Cir.
`
`2014). Here, each of the challenged claims recites a “machine,” i.e., a
`
`“portable data carrier” (claims 2–5) or a “data access device” (claims 7, 9,
`
`and 12), under § 101. Section 101, however, “contains an important implicit
`
`exception to subject matter eligibility: Laws of nature, natural phenomena,
`
`and abstract ideas are not patentable.” Alice Corp. Pty. Ltd. v. CLS Bank
`
`Int’l., 134 S. Ct. 2347, 2354 (2014) (citing Assoc. for Molecular Pathology
`
`v. Myriad Genetics, Inc., 133 S. Ct. 2107, 2116 (2013) (internal quotation
`
`marks and brackets omitted)). In Alice, the Supreme Court reiterated the
`
`framework set forth previously in Mayo Collaborative Services v.
`
`Prometheus Laboratories, 132 S. Ct. 1289, 1293 (2012) “for distinguishing
`
`patents that claim laws of nature, natural phenomena, and abstract ideas
`
`from those that claim patent-eligible applications of these concepts.” Alice,
`
`134 S. Ct. at 2355. The first step in the analysis is to “determine whether the
`
`claims at issue are directed to one of those patent-ineligible concepts.” Id.
`
`According to the Federal Circuit, “determining whether the section
`
`101 exception for abstract ideas applies involves distinguishing between
`
`patents that claim the building blocks of human ingenuity—and therefore
`
`risk broad pre-emption of basic ideas—and patents that integrate those
`
`building blocks into something more, enough to transform them into specific
`
`8
`
`
`
`CBM2015-00123
`Patent 8,033,458 B2
`
`patent-eligible inventions.” Versata Dev. Grp., Inc. v. SAP Am., Inc., 793
`
`F.3d 1306, 1332 (Fed. Cir. 2015) (emphasis added); accord id. at 1333–34
`
`(“It is a building block, a basic conceptual framework for organizing
`
`information . . . .” (emphasis added)). This is similar to the Supreme Court’s
`
`formulation in Bilski v. Kappos, 561 U.S. 593, 611 (2010) (emphasis added),
`
`noting that the concept of risk hedging is “a fundamental economic practice
`
`long prevalent in our system of commerce.” See also buySAFE, Inc. v.
`
`Google, Inc., 765 F.3d 1350, 1353–54 (Fed. Cir. 2014) (stating that patent
`
`claims related to “long-familiar commercial transactions” and relationships
`
`(i.e., business methods), no matter how “narrow” or “particular,” are
`
`directed to abstract ideas as a matter of law). As a further example, the
`
`“concept of ‘offer based pricing’ is similar to other ‘fundamental economic
`
`concepts’ found to be abstract ideas by the Supreme Court and [the Federal
`
`Circuit].” OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1362 (Fed.
`
`Cir. 2015) (citations omitted).
`
`Petitioner argues that the challenged claims are directed to the abstract
`
`idea of “payment for and/or controlling access to data based on payment or
`
`rules.” Pet. 42. We are persuaded that the challenged claims are drawn to a
`
`patent-ineligible abstract idea. Specifically, the challenged claims are
`
`directed to performing the fundamental economic practice of paying for
`
`and/or conditioning and controlling access to content. For example, claim 3
`
`recites “code for storing at least one data item in the data memory and at
`
`least one corresponding use rule in the use rule memory and code to provide
`
`external access to the data item in accordance with the use rule.” Claim 4
`
`recites “code to output the supplementary data from the interface in addition
`
`to the stored data, in response to an external request to read the data
`
`9
`
`
`
`CBM2015-00123
`Patent 8,033,458 B2
`
`memory” and “code to output payment data from the payment data memory
`
`to the interface and code to provide external access to the data memory.”
`
`Claim 5 recites “code to output payment data from the payment data
`
`memory to the interface and code to provide external access to the data
`
`memory.”
`
`As discussed above, the ’458 patent discusses addressing recording
`
`industry concerns of data pirates offering unauthorized access to widely
`
`available compressed audio recordings. Ex. 1001, 1:20–55. The ’458 patent
`
`proposes to solve this problem by restricting access to data on a device based
`
`upon satisfaction of use rules linked to payment data. Id. at 9:7–25. The
`
`’458 patent makes clear that the heart of the claimed subject matter is
`
`restricting access to stored data based on supplier-defined access rules and
`
`payment data. Id. at Abstract, 1:59–2:15.
`
`Although the Specification refers to data piracy on the Internet, the
`
`challenged claims are not limited to the Internet. The underlying concept of
`
`the challenged claims, particularly when viewed in light of the Specification,
`
`is paying for and/or controlling access to content, based on, for example,
`
`payment or rules, as Petitioner contends. As discussed further below, this is
`
`a fundamental economic practice long in existence in commerce. See Bilski,
`
`561 U.S. at 611.
`
`Patent Owner argues that claims 2–5, 7, 9, and 12 are “directed to
`
`machines,” not abstract ideas. PO Resp. 19–27. Patent Owner, however,
`
`cites no controlling authority to support the proposition that subject matter is
`
`patent-eligible as long as it is directed to “machines with specialized
`
`physical components.” PO Resp. 27. As Petitioner correctly points out (Pet.
`
`Reply 3), that argument is contradicted by well-established precedent:
`
`10
`
`
`
`CBM2015-00123
`Patent 8,033,458 B2
`
`There is no dispute that a computer is a tangible system (in § 101
`terms, a “machine”), or that many computer-implemented claims
`are formally addressed to patent-eligible subject matter. But if
`that were the end of the § 101 inquiry, an applicant could claim
`any principle of the physical or social sciences by reciting a
`computer system configured to implement the relevant concept.
`Such a result would make the determination of patent eligibility
`“depend simply on the draftman’s art,” … thereby eviscerating
`the rule that “‘… abstract ideas are not patentable.’”
`
`Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 134 S. Ct. 2347, 2358–59 (2014)
`
`(internal citations omitted).
`
`Patent Owner also argues that the challenged claims are like those
`
`found not to be directed to an abstract idea in Google Inc. v. Network-1
`
`Technologies, Inc., CBM2015-00113, and in Hulu, LLC v. iMTX Strategic,
`
`LLC, CBM2015-00147. PO Resp. 23–27. These decisions are non-
`
`precedential and distinguishable. In CBM2015-00113, the panel’s
`
`determination turned on a step requiring “correlating, by the computer
`
`system using a non-exhaustive, near neighbor search, the first electronic
`
`media work with [an or the first] electronic media work identifier” and on
`
`the Petitioner’s formulation of the alleged abstract idea. Google Inc. v.
`
`Network-1 Technologies, Inc., CBM2015-00113, Paper 7 (Oct. 19, 2015),
`
`13. Patent Owner argues that the challenged claims are like those at issue in
`
`CBM2015-00113 because they “require[] storage or use of data correlated
`
`with some other data (payment data, use status data, and/or use rules data).”
`
`PO Resp. 24. As the panel in CBM2015-00113 explained, however, the
`
`claims at issue there required “particular types of searching processes”—i.e.,
`
`“a non-exhaustive, near neighbor search”—that are different than the
`
`abstract idea alleged by Petitioner. CBM2015-00113, Paper 7 at 12–13. In
`
`this case, none of the challenged claims recite a specific search process by
`
`11
`
`
`
`CBM2015-00123
`Patent 8,033,458 B2
`
`which use rules would be correlated with content data items. For example,
`
`claim 1 (from which challenged claims 2–5 depend), recites “code for
`
`storing at least one data time in the data memory and at least one
`
`corresponding use rule in the use rule memory and code to provide external
`
`access to the data item in accordance with the user rule.” With respect to
`
`CBM2015-00147, Patent Owner mischaracterizes the Institution Decision.
`
`PO Resp. 24–25. The panel’s determination in that case was based on step
`
`two, not step one, of the Mayo/Alice test. Hulu, LLC v. iMTX Strategic,
`
`LLC, CBM2015-00147, Paper 14 (Nov. 30, 2015), 14 (“As in DDR, we are
`
`persuaded that, however the abstract idea is characterized, the ʼ854 patent
`
`claims do not meet the second prong of the Mayo/Alice test.”).
`
`Patent Owner’s Notice of Supplemental Authority also does not alter
`
`our determination. Patent Owner argues that the challenged claims are
`
`“directed to an improvement to computer functionality.” Notice 1 (quoting
`
`Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1336 (Fed. Cir. 2016)). The
`
`challenged claims, according to Patent Owner, are “directed to specific
`
`organization of data and defined sequences of transaction steps with distinct
`
`advantages over alternatives” (id. at 2) and, therefore, “like those in Enfish,
`
`‘are directed to a specific implementation of a solution to a problem’ in
`
`Internet digital commerce” (id. at 3). Unlike the self-referential table at
`
`issue in Enfish, however, the challenged claims do not purport to be an
`
`improvement to the way computers operate. Instead, they “merely
`
`implement an old practice in a new environment.” FairWarning IP, LLC v.
`
`Iatric Systems, Inc., No. 2015-1985, slip op. 7 (Fed. Cir. Oct. 11, 2016).
`
`Petitioner argues, and we agree, that the challenged claims, like those in In
`
`re TLI Communications LLC Patent Litigation, 823 F.3d 607 (Fed. Cir.
`
`12
`
`
`
`CBM2015-00123
`Patent 8,033,458 B2
`
`2016), “perform[] generic computer functions such as storing, receiving, and
`
`extracting data” using “physical components” that “behave exactly as
`
`expected according to their ordinary use” and “merely provide a generic
`
`environment in which to carry out the abstract idea” of controlling access to
`
`content based on payment and/or rules. Notice Resp. 2–3 (quoting In re TLI
`
`Communications LLC Patent Litigation, 823 F.3d at 612–15). The
`
`limitations of the challenged claims—e.g., “code to provide external access,”
`
`“code to output payment data,” “code to update,” “code for storing,” “code
`
`to write,” “code to select,” “code to receive,” “code to retrieve and
`
`output”—are so general that they
`
`do no more than describe a desired function or outcome, without
`providing any limiting detail
`that confines the claim to a
`particular solution to an
`identified problem. The purely
`functional nature of the claim confirms that it is directed to an
`abstract idea, not to a concrete embodiment of that idea.
`
`Affinity Labs of Texas, LLC v. Amazon.com Inc., No. 2015-2080, slip
`
`op. 7 (Fed. Cir. Sept. 23, 2016) (citation omitted).
`
`We are, thus, persuaded, based on the Specification and the language
`
`of the challenged claims, that claims 2–5, 7, 9, and 12 of the ’458 patent are
`
`directed to an abstract idea. See Alice, 134 S. Ct. at 2356 (holding that the
`
`concept of intermediated settlement at issue in Alice was an abstract idea);
`
`Accenture Global Servs., GmbH v. Guidewire Software, Inc., 728 F.3d 1336,
`
`1344 (Fed. Cir. 2013) (holding the abstract idea at the heart of a system
`
`claim to be “generating tasks [based on] rules . . . to be completed upon the
`
`occurrence of an event”).
`
`13
`
`
`
`CBM2015-00123
`Patent 8,033,458 B2
`
`2. Inventive Concept
`
`“A claim that recites an abstract idea must include ‘additional
`
`features’ to ensure ‘that the [claim] is more than a drafting effort designed to
`
`monopolize the [abstract idea].’” Alice, 134 S. Ct. at 2357 (quoting Mayo,
`
`132 S. Ct. at 1297). “This requires more than simply stating an abstract idea
`
`while adding the words ‘apply it’ or ‘apply it with a computer.’ Similarly,
`
`the prohibition on patenting an ineligible concept cannot be circumvented by
`
`limiting the use of an ineligible concept to a particular technological
`
`environment.” Versata, 793 F.3d at 1332 (citations omitted). Moreover, the
`
`mere recitation of generic computer components performing conventional
`
`functions is not enough. See Alice, 134 S. Ct. at 2360 (“Nearly every
`
`computer will include a ‘communications controller’ and ‘data storage unit’
`
`capable of performing the basic calculation, storage, and transmission
`
`functions required by the method claims.”).
`
`Petitioner argues that “the [challenged c]laims’ ‘additional features’
`
`recite only well-known, routine, and conventional computer components and
`
`activities, which is insufficient to establish an inventive concept.” Pet.
`
`Reply 6. We are persuaded that claims 2–5, 7, 9, and 12 of the ’458 patent
`
`do not add an inventive concept sufficient to ensure that the patent in
`
`practice amounts to significantly more than a patent on the abstract idea
`
`itself. Alice, 134 S. Ct. at 2355; see also Accenture Global Servs., 728 F.3d
`
`at 1344 (holding claims directed to the abstract idea of “generating tasks
`
`[based on] rules . . . to be completed upon the occurrence of an event” to be
`
`unpatentable even when applied in a computer environment and within the
`
`insurance industry). Specifically, we agree with and adopt the rationale
`
`articulated in the Petition that the additional elements of the challenged
`
`14
`
`
`
`CBM2015-00123
`Patent 8,033,458 B2
`
`claims are either field of use limitations and/or generic features of a
`
`computer that do not bring the challenged claims within § 101 patent
`
`eligibility. Pet. 50–67.
`
`a. Technical Elements
`
`Petitioner argues that the challenged claims are unpatentable because
`
`they “are directed only to an abstract idea with nothing more than ‘well-
`
`understood, routine, conventional activity’ added.” Pet. 50 (citations
`
`omitted). Patent Owner disagrees, arguing that the challenged claims are
`
`patentable because they recite “specific ways of using distinct memories,
`
`data types, and use rules that amount to significantly more than the
`
`underlying abstract idea.” PO Resp. 49–50 (quoting Ex. 2049, 19). We
`
`agree with Petitioner for the following reasons.
`
`The ’458 patent treats as well-known all potentially technical aspects
`
`of the challenged claims, which simply require generic computer
`
`components (e.g., interfaces, memory, program store, and processor). See
`
`Pet. Reply 5–6 (citing Ex. 1001, 4:4–13, 11:28–29, 12:29–32, 16:46–50,
`
`18:7–17). With respect to the “portable data carrier” recited in claims 2–5,
`
`for example, the Specification states it may be a generic device such as “a
`
`standard smart card.” Ex. 1001, 11:27–29; see also id. at 14:25–29
`
`(“[l]ikewise data stores 136, 138 and 140 may comprise a single physical
`
`data store or may be distributed over a plurality of physical devices and may
`
`even be at physically remote locations from processors 128-134 and coupled
`
`to these processors via internet 142”), Fig. 6. As for the “SIM portion”
`
`recited in claim 2, the ’458 patent explains that “mobile phone SIM
`
`(Subscriber Identity Module) card[s] … already include a user identification
`
`15
`
`
`
`CBM2015-00123
`Patent 8,033,458 B2
`
`means, to allow user billing through the phone network operator.” Id. at
`
`4:10–13.
`
`Further, the claimed computer code performs generic computer
`
`functions, such as outputting data, providing access to memory and data,
`
`updating memory, storing data, receiving and evaluating data, accessing
`
`data, and selecting data. See Pet. 53–56. The recitation of these generic
`
`computer functions is insufficient to confer specificity. See Content
`
`Extraction and Transmission LLC v. Wells Fargo Bank, Nat’l Ass’n, 776
`
`F.3d 1343, 1347 (Fed. Cir. 2014) (“The concept of data collection,
`
`recognition, and storage is undisputedly well-known. Indeed, humans have
`
`always performed these functions.”).
`
`Moreover, we are not persuaded that claims 2–5, 7, 9, and 12 “recite
`
`specific ways of using distinct memories, data types, and use rules that
`
`amount to significantly more than” paying for and/or controlling access to
`
`content. See PO Resp. 49 (quoting Ex. 2049, 1–4). The challenged claims
`
`generically recite several memories, including “data memory,” “payment
`
`data memory,” “a program store,” “use record memory,” “use rule memory,”
`
`and “content data memory,” and generically recite several data types,
`
`including “data,” “payment data,” “use status data,” “use rules data,” and
`
`“code.” We are not persuaded that the recitation of these memories and data
`
`types, by itself, amounts to significantly more than the underlying abstract
`
`idea. Patent Owner does not point to any inventive concept in the ’458
`
`patent related to the way these memories or data types are constructed or
`
`used. In fact, the ’458 patent simply discloses these memories and data
`
`types with no description of the underlying implementation or programming.
`
`See Content Extraction and Transmission LLC, 776 F.3d at 1347 (“The
`
`16
`
`
`
`CBM2015-00123
`Patent 8,033,458 B2
`
`concept of data collection, recognition, and storage is undisputedly well-
`
`known. Indeed, humans have always performed these functions.”). This
`
`recitation of generic computer memories and data types, being used in the
`
`conventional manner, is insufficient to confer the specificity required to
`
`elevate the nature of the claim into a patent-eligible application. Alice, 134
`
`S. Ct. at 2355 (quoting Mayo, 132 S. Ct. at 1294) (“We have described step
`
`two of this analysis as a search for an ‘inventive concept’—i.e., an element
`
`or combination of elements that is ‘sufficient to ensure that the patent in
`
`practice amounts to significantly more than a patent on the [ineligible
`
`concept] itself.’”) (brackets in original); Affinity Labs, No. 2015-2080, slip
`
`op. 10–11 (“The claims do not go beyond ‘stating [the relevant] functions in
`
`general terms, without limiting them to technical means for performing the
`
`functions that are arguably an advance over conventional computer and
`
`network technology.’”).
`
`In addition, because the recited elements can be implemented on a
`
`general purpose computer, the challenged claims do not cover a “particular
`
`machine.” Pet. 70; see Bilski, 561 U.S. at 604–05 (stating that machine-or-
`
`transformation test remains “a useful and important clue” for determining
`
`whether an invention is patent eligible). And the challenged claims do not
`
`transform an article into a different state or thing. Pet. 70–71.
`
`Thus, we determine, the potentially technical elements of the
`
`challenged claims are nothing more than “generic computer
`
`implementations” and perform functions that are “purely conventional.”
`
`Alice, 134 S. Ct. at 2358–59; Mayo, 132 S. Ct. at 1294.
`
`17
`
`
`
`CBM2015-00123
`Patent 8,033,458 B2
`
`b. DDR Holdings
`
`Relying on the Federal Circuit’s decision in DDR Holdings, Patent
`
`Owner asserts that the challenged claims are directed to statutory subject
`
`matter because the claimed solution is “‘necessarily rooted in computer
`
`technology in order to overcome a problem specifically arising in the realm
`
`of computer networks.’” PO Resp. 1–2 (quoting DDR Holdings, LLC v.
`
`Hotels.com, L.P., 773 F.3d 1245, 1257 (Fed. Cir. 2014)). Patent Owner
`
`contends that
`
`By using a system that combines on the data carrier both the
`digital content and the use rules/use status data, access control to
`the digital content can be continuously enforced prior to access
`to the digital content. By comparison, unlike a system that uses
`use rules/use status data as claimed, when a DVD was physically
`rented for a rental period, there was no mechanism to write
`partial use status data to the DVD when only part of the DVD
`had been accessed (e.g., to track whether a renter had “finished
`with” the DVD yet).
`
`Id. at 18.
`
`Petitioner responds that the challenged claims are distinguishable
`
`from the claims in DDR Holdings. Pet. Reply 12–17. The DDR Holdings
`
`patent is directed at retaining website visitors when clicking on an
`
`advertisement hyperlink within a host website. 773 F.3d at 1257.
`
`Conventionally, clicking on an advertisement hyperlink would transport a
`
`visitor from the host’s website to a third party website. Id. The Federal
`
`Circuit distinguished this Internet-centric problem over “the ‘brick and
`
`mortar’ context” because “[t]here is . . . no possibility that by walking up to
`
`[a kiosk in a warehouse store], the customer will be suddenly and completely
`
`transported outside the warehouse store and relocated to a separate physical
`
`venue associated with the third party.” Id. at 1258. The Federal Circuit
`
`18
`
`
`
`CBM2015-00123
`Patent 8,033,458 B2
`
`further determined that the DDR Holdings claims specify “how interactions
`
`with the Internet are manipulated to yield a desired result—a result that
`
`overrides the routine and conventional sequence of events ordinarily
`
`triggered by the click of a hyperlink.” Id. The unconventional result in
`
`DDR Holdings is the website visitor is retained on the host website, but is
`
`still able to purchase a product from a third-party merchant. Id. at 1257–58.
`
`The limitation referred to by the Federal Circuit in DDR Holdings recites
`
`“using the data retrieved, automatically generate and transmit to the web
`
`browser a second web page that displays: (A) information associated with
`
`the commerce object associated with the link
Accessing this document will incur an additional charge of $.
After purchase, you can access this document again without charge.
Accept $ Charge
Still Working On It
This document is taking longer than usual to download. This can happen if we need to contact the court directly to obtain the document and their servers are running slowly.
Give it another minute or two to complete, and then try the refresh button.
A few More Minutes ... Still Working
It can take up to 5 minutes for us to download a document if the court servers are running slowly.
Thank you for your continued patience.
This document could not be displayed.
We could not find this document within its docket. Please go back to the docket page and check the link. If that does not work, go back to the docket and refresh it to pull the newest information.
Your account does not support viewing this document.
You need a Paid Account to view this document. Click here to change your account type.
Your account does not support viewing this document.
Set your membership
status to view this document.
With a Docket Alarm membership, you'll
get a whole lot more, including:
- Up-to-date information for this case.
- Email alerts whenever there is an update.
- Full text search for other cases.
- Get email alerts whenever a new case matches your search.
One Moment Please
The filing “” is large (MB) and is being downloaded.
Please refresh this page in a few minutes to see if the filing has been downloaded. The filing will also be emailed to you when the download completes.
Your document is on its way!
If you do not receive the document in five minutes, contact support at support@docketalarm.com.
Sealed Document
We are unable to display this document, it may be under a court ordered seal.
If you have proper credentials to access the file, you may proceed directly to the court's system using your government issued username and password.
Access Government Site
