EXHIBIT 1012
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`
`
`EXHIBIT 1012EXHIBIT 1012
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`
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`TO PETITIONER GOOGLE INC.’STO PETITIONER GOOGLE INC.’S
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`
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`PETITION FOR COVERED BUSINESSPETITION FOR COVERED BUSINESS
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`
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`METHOD REVIEW OFMETHOD REVIEW OF
`
`TO PETITIONER GOOGLE INC.’S
`PETITION FOR COVERED BUSINESS
`METHOD REVIEW OF
`U.S. PATENT NO. 7,334,720
`
`U.S. PATENT NO. 7,334,720U.S. PATENT NO. 7,334,720
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`

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`Case 6:13-cv-00448-KNM Document 175 Filed 06/13/14 Page 1 of 43 PageID #: 3407
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`TYLER DIVISION
`
`SMARTFLASH LLC, et al.,
`
`
`
`Plaintiffs,
`
`
`v.
`
`APPLE, INC., et al.,
`
`Defendants.
`
`
`
`
`
`
`
`
`
`
`
`
`
`Case No. 6:13-cv-00447-KNM
`
`JURY TRIAL DEMANDED
`
`Case No. 6:13-CV-00448-KNM
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`JURY TRIAL DEMANDED
`
`
`
`SMARTFLASH LLC, et al.,
`
`Plaintiffs,
`
`
`
`v.
`
`SAMSUNG ELECTRONICS CO.,
`LTD., et al.,
`
`Defendants.
`
`
`PLAINTIFFS SMARTFLASH LLC’S AND SMARTFLASH
`TECHNOLOGIES LIMITED’S OPENING CLAIM CONSTRUCTION BRIEF
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`
`
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`
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`Google Exhibit 1012 Page 00001
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`

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`Case 6:13-cv-00448-KNM Document 175 Filed 06/13/14 Page 2 of 43 PageID #: 3408
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`
`
`
`I.
`
`II.
`
`III.
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`IV.
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`TABLE OF CONTENTS
`Introduction ..........................................................................................................................1
`
`Technology Background ......................................................................................................1
`
`Applicable Law ....................................................................................................................3
`
`Argument .............................................................................................................................4
`
`A.
`
`B.
`
`C.
`
`D.
`
`“payment data” .........................................................................................................4
`
`“payment validation system” ...................................................................................7
`
`1.
`
`2.
`
`excludes
`improperly
`proposal
`Defendants’
`embodiments. ...............................................................................................7
`
`unnecessary
`imports
`proposal
`Defendants’
`functional requirements into the claims. ......................................................9
`
`“payment validation data” ......................................................................................11
`
`“content data memory” “non-volatile data memory”
`“memory … for storing data” “memory configured to store
`… content” “parameter memory” “use rule memory” ...........................................12
`
`E.
`
`“data carrier” ..........................................................................................................17
`
`1.
`
`2.
`
`3.
`
`4.
`
`A data carrier is not limited to a “removable smart
`card or integrated circuit (IC) card.” ..........................................................18
`
`A data carrier is not limited to a “having two or
`more separate non-volatile memories, for storing
`both payment data and content data.” ........................................................20
`
`A data carrier is “for storing both payment data and
`content data.” .............................................................................................20
`
`A data carrier is not required to “incorporate[e] a
`processor.” .................................................................................................21
`
`F.
`
`G.
`
`H.
`
`“portable data carrier” ............................................................................................22
`
`“use rule(s)” “use rule(s) data” “data use rule data” ..............................................23
`
`“access rule(s)” ......................................................................................................24
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`1.
`
`Use/access rules need not be “separately stored”
`from content. ..............................................................................................24
`
`i
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`Page 00002
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`Case 6:13-cv-00448-KNM Document 175 Filed 06/13/14 Page 3 of 43 PageID #: 3409
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`2.
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`3.
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`Defendants’ proposed “indicating permissible
`use…” and “specifying under what conditions…”
`limitations
`are unnecessary
`and potentially
`confusing. ...................................................................................................26
`
`Defendants’ reference to a “content data item” is
`confusing. ...................................................................................................26
`
`“use status data” .....................................................................................................26
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`“said code to control access permitting access to said
`second selected one or more items of retrieved multimedia
`content” ..................................................................................................................28
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`“the card” ...............................................................................................................31 
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`Alleged Means Plus Function Terms .....................................................................33 
`
`I.
`
`J.
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`K.
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`L.
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`Conclusion .........................................................................................................................35
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`
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`V. 
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`
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`ii
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`Page 00003
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`Case 6:13-cv-00448-KNM Document 175 Filed 06/13/14 Page 4 of 43 PageID #: 3410
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`TABLE OF AUTHORITIES
`
`
`Alloc, Inc. v. Int'l Trade Comm’n,
` 342 F.3d 1361 (Fed. Cir. 2003)................................................................................................... 3
`
`Becton, Dickinson & Co. v. Tyco Healthcare Grp., LP,
` 616 F.3d 1249 (Fed. Cir. 2010)................................................................................... 5, 6, 14, 25
`
`Bose Corp. v. JBL, Inc.,
` 274 F.3d 1354 (Fed. Cir. 2001)................................................................................................. 31
`
`C.R. Bard, Inc. v. U.S. Surgical Corp.,
` 388 F.3d 858 (Fed. Cir. 2004)..................................................................................................... 3
`
`Cannon Rubber Ltd. v. First Years, Inc.,
` 163 Fed. Appx. 870 (Fed. Cir. 2005) .................................................................................... 6, 13
`
`Catalina Mktg. Int’l, Inc. v. Coolsavings.com, Inc.,
` 289 F.3d 801 (Fed. Cir. 2002)................................................................................................... 11
`
`Cheetah Omni LLC v. Alcatel-Lucent Inc.,
` 939 F.Supp.2d 649 (E.D. Tex. Apr. 11, 2013) .......................................................................... 29
`
`Comark Commc’ns, Inc. v. Harris Corp.,
` 156 F.3d 1182 (Fed. Cir. 1998)............................................................................................. 3, 20
`
`Constant v. Advanced Micro–Devices, Inc.,
` 848 F.2d 1560 (Fed. Cir. 1988)................................................................................................... 3
`
`Cordis Corp. v. Medtronic AVE, Inc.,
` 339 F.3d 1352 (Fed. Cir. 2003)................................................................................................. 15
`
`Energizer Holdings, Inc. v. International Trade Com’n,
` 435 F.3d 1366 (Fed. Cir. 2006)........................................................................................... 29, 31
`
`Epistar Corp. v. Int’l Trade Comm’n,
` 566 F.3d 1321 (Fed. Cir. 2009)................................................................................................... 4
`
`Golight, Inc. v. Wal–Mart Stores, Inc.,
` 355 F.3d 1327 (Fed. Cir. 2004)................................................................................................. 15
`
`In Spine Solutions, Inc. v. Medtronic Sofamor Danek USA, Inc.,
` 620 F.3d 1305 (Fed. Cir. 2010)................................................................................................... 4
`
`Innova/Pure Water Inc. v. Safari Water Filtration Sys., Inc.,
` 381 F.3d 1111 (Fed. Cir. 2004)) ................................................................................................. 3
`
` 
`
`iii 
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`Page 00004
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`Case 6:13-cv-00448-KNM Document 175 Filed 06/13/14 Page 5 of 43 PageID #: 3411
`
`
`Intellectual Property Development, Inc. v. UAColumbia Cablevision,
` 336 F.3d 1308 (Fed. Cir. 2003)............................................................................................. 6, 13
`
`Invitrogen Corp. v. Clontech Labs., Inc.,
` 429 F.3d 1052 (Fed. Cir. 2005)..................................................................................... 16, 20, 25
`
`Liebel–Flarsheim Co. v. Medrad, Inc.,
` 358 F.3d 898 (Fed. Cir. 2004)................................................................................................... 10
`
`Luv N' Care, Ltd. v. Koninklijke Philips Electronics N.V.,
` No. 2:11-CV-512, 2013 WL 3471269 (E.D. Tex. July 9, 2013) .............................................. 31
`
`Nautilus, Inc. v. Biosig Instruments, Inc.,
` 134 S. Ct. 2120 (2014) .................................................................................................. 28, 29, 31
`
`Novo Indus., L.P. v. Micro Molds Corp.,
` 350 F.3d 1348 (Fed. Cir. 2003)................................................................................................. 31
`
`Omega Engineering, Inc. v. Raytek,
` 334 F.3d 1314 (Fed. Cir. 2003)........................................................................................... 15, 25
`
`Paragon Solutions, LLC v. Timex Corp.,
` 566 F.3d 1075 (Fed. Cir. 2009)................................................................................................. 11
`
`Phillips v. AWH Corp.,
` 415 F.3d 1303 (Fed. Cir. 2005)....................................................................................... 3, 10, 17
`
`ResQNet.com, Inc. v. Lansa, Inc.,
` 346 F.3d 1374 (Fed. Cir. 2003)........................................................................................... 16, 20
`
`SanDisk Corp. v. Memorex Products, Inc.,
` 415 F.3d 1278 (Fed. Cir. 2005)................................................................................................. 15
`
`Saunders Group, Inc. v. Comfortrac, Inc.,
` 492 F.3d 1326 (Fed. Cir. 2007)................................................................................................. 16
`
`Tele-Cons, Inc. v. General Elec. Co.,
` 6:10-CV-451 LED-JDL, 2012 WL 3112299 (E.D. Tex. Jul. 31, 2012) ................................... 29
`
`Teleflex, Inc. v. Ficosa N. Am. Corp.,
` 299 F.3d 1313 (Fed. Cir. 2002)........................................................................................... 17, 18
`
`Thorner v. Sony Computer Entm’t Am. LLC,
` 669 F.3d 1362 (Fed. Cir. 2012)................................................................................................... 3
`
`
` 
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`iv 
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`Page 00005
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`Case 6:13-cv-00448-KNM Document 175 Filed 06/13/14 Page 6 of 43 PageID #: 3412
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`TracBeam, L.L.C. v. AT & T, Inc.,
` 6:11-CV-96, 2013 WL 250532 (E.D. Tex. Jan. 23, 2013) ....................................................... 31
`
`Ventana Med. Sys. v. Biogenex Labs.,
` 473 F.3d 1173 (Fed. Cir. 2006)..................................................................................... 16, 20, 25
`
`Statutes
`
`35 U.S.C. § 112 ........................................................................................................... 28, 29, 33, 35
`
`Other Authorities
`
`MPEP § 2173.05(e) ................................................................................................................. 29, 31
`
`   
`
` 
`
`v 
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`Page 00006
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`

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`Case 6:13-cv-00448-KNM Document 175 Filed 06/13/14 Page 7 of 43 PageID #: 3413
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`
`I.
`
`INTRODUCTION
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`A consistent theme emerges from the parties’ competing constructions. Smartflash’s
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`proposals give full scope to the claim language, as firmly supported by the intrinsic evidence.
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`Defendants’ proposed constructions seek to limit the claims to certain preferred embodiments
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`while excluding others. Smartflash respectfully requests that the Court adopt its proposals as
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`supported by the intrinsic and extrinsic evidence and the canons of claim construction.
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`II.
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`TECHNOLOGY BACKGROUND
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`The patents-in-suit all stem from a common specification1 that describes a data supply
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`system, and various user devices, generally referred to as data access terminals and data access
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`devices, that may be used by consumers to purchase and use content from the system. A user
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`can store payment data on these devices and connect to the data supply system to exchange
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`payment data for downloadable content.
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`Referring to preferred embodiments, the patents-in-suit disclose that the data supply
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`system is designed to provide users with a seamless purchase and content delivery experience.
`
`’720 patent at 24:25-24:32. Users are able to purchase content from a variety of different content
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`providers even if they do not know where the content providers are located or how the content is
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`delivered. See id. The exemplary system is operated by a “content data supply ‘system owner,’”
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`who can act as an intermediary between a user seeking to purchase content and content
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`providers, such as record labels, movie studios, and software providers. See ’720 patent at 14:7-
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`14:14. When a user accesses the system, he or she is able to select content to purchase or rent
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`from a variety of different content providers. See ’720 patent at 4:63-5:3. If the user finds a
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`content item to buy, his or her device will transmit stored “payment data” to a “payment
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`1 For the Court’s convenience, citations in this brief refer to the specification of the ’720 patent.
`
`1
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`Page 00007
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`Case 6:13-cv-00448-KNM Document 175 Filed 06/13/14 Page 8 of 43 PageID #: 3414
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`validation system” to validate the payment data. See ’720 patent at 8:4-8:6. Once the payment
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`validation system returns proof that the payment data has been validated, in the form of
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`“payment validation data,” the user is able to retrieve the purchased content from the content
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`provider. ’720 patent at 8:6-8:9.
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`The system owner’s system can also connect to an e-payment system coupled to a bank.
`
`See ’720 patent 13:46-13:47. The e-payment system handles the actual transfer of money. See
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`’720 patent at 23:27-23:33. If the system owner validates the user’s payment data, using its own
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`payment validation system, then it may seek reimbursement from the e-payment system at a later
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`time. See ’720 patent at 13:58-13:62 On the other hand, if the user submits payment data
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`directly to a payment validation system at the e-payment system, the e-payment system may
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`validate the payment data and transfer money to the system owner’s account before the system
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`owner provides the content to the user. See ’720 patent at 23:23-23:28.
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`In addition to describing a data supply system, the patents describe a variety of user
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`devices that can be used with the system. For example, a user can purchase content from the
`
`data supply system using a data access terminal and download the content to a “data carrier.”
`
`See ’720 patent at 8:10-12. The patents describe a wide variety of data access terminals—
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`including mobile communication devices, personal computers, and television set top boxes—as
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`examples of devices that may be used with the system. See ’720 patent at Fig. 7; 16:1-35. The
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`patents describe that a data carrier may be a removable memory device, such as a smart card or
`
`memory stick, but they also explain that it can be integrated into a data access terminal, such as a
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`mobile communications device. See ’720 patent at 4:43-44; 16:6-10. These devices store
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`content such as music, videos, and software. Id. Access to the content is controlled by access
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`rules and use rules. See ’720 patent at 4:59-5:3. By using these rules, a content provider can
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`2
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`Page 00008
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`Case 6:13-cv-00448-KNM Document 175 Filed 06/13/14 Page 9 of 43 PageID #: 3415
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`provide content for sale or rent, or set special rules for accessing certain types of content. Id.
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`For example, a user could be required to pay extra to unlock an extra level of a game or to
`
`download the rest of the songs on an album. See ’720 patent at 3:16-3:18. The patents-in-suit
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`cover various aspects of the data supply system and the disclosed user devices.
`
`III. APPLICABLE LAW
`
`“It is a ‘bedrock principle’ of patent law that ‘the claims of a patent define the invention
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`to which the patentee is entitled the right to exclude.’” Phillips v. AWH Corp., 415 F.3d 1303,
`
`1312 (Fed. Cir. 2005) (en banc) (quoting Innova/Pure Water Inc. v. Safari Water Filtration Sys.,
`
`Inc., 381 F.3d 1111, 1115 (Fed. Cir. 2004)). In claim construction, courts examine the patent’s
`
`intrinsic evidence to define the patented invention’s scope. See id.; C.R. Bard, Inc. v. U.S.
`
`Surgical Corp., 388 F.3d 858, 861 (Fed. Cir. 2004). This intrinsic evidence includes the claims
`
`themselves, the specification, and the prosecution history. See Phillips, 415 F.3d at 1314; C.R.
`
`Bard, Inc., 388 F.3d at 861. Courts give claim terms their ordinary and accustomed meaning as
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`understood by one of ordinary skill in the art at the time of the invention in the context of the
`
`entire patent. Phillips, 415 F.3d at 1312–13; Alloc, Inc. v. Int'l Trade Comm’n, 342 F.3d 1361,
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`1368 (Fed. Cir. 2003).
`
` “Although the specification may aid the court in interpreting the meaning of disputed
`
`claim language, particular embodiments and examples appearing in the specification will not
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`generally be read into the claims.’” Comark Commc’ns, Inc. v. Harris Corp., 156 F.3d 1182,
`
`1187 (Fed. Cir. 1998) (quoting Constant v. Advanced Micro–Devices, Inc., 848 F.2d 1560, 1571
`
`(Fed. Cir. 1988)). Specifically, Courts may not rely on the specification to “redefine words” in
`
`the claim language. See Thorner v. Sony Computer Entm’t Am. LLC, 669 F.3d 1362, 1366-67
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`(Fed. Cir. 2012). “Only the patentee can do that. To constitute disclaimer, there must be a clear
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`and unmistakable disclaimer.” Id. “Mere criticism of a particular embodiment encompassed in
`3
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`Page 00009
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`Case 6:13-cv-00448-KNM Document 175 Filed 06/13/14 Page 10 of 43 PageID #: 3416
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`the plain meaning of a claim term is not sufficient to rise to the level of clear disavowal.”
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`Epistar Corp. v. Int’l Trade Comm’n, 566 F.3d 1321, 1335 (Fed. Cir. 2009) (holding that even a
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`direct criticism of a particular technique did not rise to the level of clear disavowal). Moreover,
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`even where a particular structure makes it “particularly difficult” to obtain certain benefits of the
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`claimed invention, this does not rise to the level of disavowal of the structure. See In Spine
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`Solutions, Inc. v. Medtronic Sofamor Danek USA, Inc., 620 F.3d 1305, 1315 (Fed. Cir. 2010).
`
`IV. ARGUMENT
`
`A.
`
`“payment data”2 – ’720 claims 11,13, 14, 15; ’317 claims 6, 7, 8, 13, 14, 16, 18;
`’598 claim 7; ’221 claims 2, 11, 14, 32; ’772 claims 5, 10, 14, 22, 26, 32
`
`Smartflash’s Proposal
`data that can be used to make payment for
`content
`
`Defendants’ Proposal
`data, distinct from access control data and
`user identity data, representing either actual
`payment made or record of payment made for
`requested content data
`
`
`The parties agree that the term “payment data” relates to payment for content, but there
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`are two disputes: (1) whether payment data is used to make a payment or whether it
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`memorializes a payment that has already been made; and (2) whether the term should be limited
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`to embodiments where payment data is “distinct from access control data or user identity data.”
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`The claims of the patents-in-suit make clear that payment data is used to make a
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`payment. For example, claim 30 of the ’772 patent exemplifies this process:
`
`code responsive to said first user selection of said selected at least
`one content data item to transmit payment data relating to payment
`for said selected at least one content item for validation by a
`payment validation system;
`code to receive payment validation data defining if said payment
`validation system has validated payment for said selected at least
`one content data item;
`
`2 The following list identifies the asserted claims that contain this term, not all claims that
`contain the term.
`
`4
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`Page 00010
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`Case 6:13-cv-00448-KNM Document 175 Filed 06/13/14 Page 11 of 43 PageID #: 3417
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`code responsive to the payment validation data to retrieve said
`selected at least one content data item from a data supplier and to
`write said retrieved at least one content data item into said data
`carrier
`This exemplary claim sets out the order in which payment data is exchanged. First, a user selects
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`an item of multimedia content to purchase. To purchase the selected content, the data access
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`terminal transmits payment data to a payment validation system. If the payment validation
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`system validates the data, then payment validation data is transmitted back to the data access
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`terminal. In response to receiving payment validation data, the data access terminal retrieves the
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`content data item that was just purchased. The role of “payment data” in this claim is to make a
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`payment, and all claims of the patents-in-suit consistently use “payment data” in this way.
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`The specification also consistently teaches the use of “payment data” to make a payment.
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`For example, Figure 12c provides an exemplary flow diagram for purchasing content. ’720
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`patent at 20:8-20:10. The specification explains that during the first step in this process, step
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`S54, “payment data for making a payment” is transmitted from the data access terminal. See
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`’720 at 21:15-21:16 (emphasis added). After the payment data is validated, the purchased
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`content is downloaded to the data access terminal at step S57. See ’720 at 21:44-21:48.
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`Defendants’ proposal is flawed because it misunderstands the role of “payment data” in
`
`the patents-in-suit. As discussed above, the purpose of payment data is to make a payment for
`
`content—not to represent that a payment has already been made. The claims themselves further
`
`disprove Defendants’ proposed construction. Because claim 30 of the ’772 patent requires a
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`device to transmit payment data for an item in response to a user selection for the item,
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`Defendants’ proposal would require a user to pay for an item before selecting it. Otherwise, the
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`device would not contain the payment data that it needs to transmit in response to the user
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`selection. The Court should reject this nonsensical result. See Becton, Dickinson & Co. v. Tyco
`
`5
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`Page 00011
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`Case 6:13-cv-00448-KNM Document 175 Filed 06/13/14 Page 12 of 43 PageID #: 3418
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`Healthcare Grp., LP, 616 F.3d 1249, 1255 (Fed. Cir. 2010) (“A claim construction that renders
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`asserted claims facially nonsensical cannot be correct.”).
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`Defendants’ proposal is also flawed because it injects a new limitation into the claims by
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`requiring that payment data must be “distinct from access control data and user identity data.”3
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`There is nothing in the claims, the specification, or the prosecution history that would support
`
`this construction. The Defendants’ proposed construction simply has no basis in the principles
`
`of claim construction. The claims require that payment data is data that can be used to make a
`
`payment for data. If access control data or user identity data may be used to pay for content,
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`then this type of data acts as payment data. Cf. Cannon Rubber Ltd. v. First Years, Inc., 163 Fed.
`
`Appx. 870, 877 (Fed. Cir. 2005) (“[T]here is nothing in the . . . specification or the claims that
`
`require the ‘deformable diaphragm’ and ‘valve means’ limitations to be embodied as two
`
`separate structural components. . . . Tellingly, [defendant] does not cite any case law prohibiting
`
`a claim from reciting two limitations embodied by the same structural component.”); Intellectual
`
`Property Development, Inc. v. UAColumbia Cablevision, 336 F.3d 1308, 1320 n. 9 (Fed. Cir.
`
`2003) (“Contrary to Cablevision’s argument, we see no reason why, as a matter of law, one
`
`claim limitation may not be responsive to another merely because they are located in the same
`
`physical structure.”). In sum, the Court should reject Defendants’ proposed construction.
`
`
`3 The term “user identity data” appears only once throughout the patents-in-suit: “This card
`registration data comprises user identity data, access control data, payment system specifying
`data, system owner access data, such as a system owner web page address and other dial-up
`information.” ’720 patent at 19:42-19:46. The term “access control data” appears throughout
`the specification and is described as including a “user ID and a password” for protecting valuable
`information. ’720 patent at 5:29-5:31.
`
`6
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`Page 00012
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`Case 6:13-cv-00448-KNM Document 175 Filed 06/13/14 Page 13 of 43 PageID #: 3419
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`B.
`
`“payment validation system” – ’720 claims 11, 13, 14, and 15; ’221 claims 2,
`11, 14, and 32; ’772 claims 5, 10, 14, 22, 26, and 32
`
`Smartflash’s Proposal
`[no construction necessary]
`
`Alternatively: system that returns payment
`validation data in response to valid payment
`data
`
`Defendants’ Proposal
`system to validate payment data and authorize
`payment
`
` A
`
` person of ordinary skill seeking to understand the meaning of this term need look no
`
`further than the claim language itself. For example, ’772 claim 30 requires that a user device
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`“transmit payment data relating to payment for said selected at least one content item for
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`validation by a payment validation system” and “receive payment validation data defining if said
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`payment validation system has validated payment for said selected at least one content data
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`item.” See also ’772 patent claims 1, 8, 14, 19, 25, 30. Every other asserted claim that includes
`
`this term confirms that the payment validation system receives payment data, validates the
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`payment data, and outputs payment validation data. See, e.g., ’720 patent claim 3, ’598 patent
`
`claim 7, ’221 patent claims 1, 32.
`
`Defendants do not dispute this conclusion or assert that any of the words of this term are
`
`ambiguous or unclear. Quite the contrary, the parties all agree that a payment validation system
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`is a system that validates payment data. Given this fundamental agreement and the clear
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`description of this term in the claim language, there is no need to construe this term. Defendants
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`only request construction for this term in an effort to inject a new limitation into the claims—that
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`the payment validation system also authorize payment.
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`1.
`
`Defendants’ proposal improperly excludes embodiments.
`
`While Defendants’ proposal provides no insight into their intended meaning of the phrase
`
`“authorize payment,” Defendants no doubt intend to rely on it as a non-infringement hook. They
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`7
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`Page 00013
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`Case 6:13-cv-00448-KNM Document 175 Filed 06/13/14 Page 14 of 43 PageID #: 3420
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`will likely argue that “payment authorization” refers to the act of transferring monetary value as
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`performed by an e-payment system or credit card processor. They may further argue that even if
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`they perform some sort of validation, such as confirming that a credit card number is accurate,
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`they do not infringe because they do not actually cause money to change hands. The claims
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`should not be construed so narrowly as to support this argument.
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`Defendants’ proposal appears to be based on descriptions in the specification of an
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`embodiment where a user device transfers payment data to a data supplier that relies on a third
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`party payment authority to process the transaction and authorize payment. See, e.g., ’720 patent
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`at 11:66-12:4 (“A user connects the data carrier (30) to terminal (40) and logs on to a data web
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`page of data supply service provider (60). Either terminal (40) or service provider (60) then
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`communicates via data paths (62) with a payment validation authority (70) to check and
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`authorize the user’s or payer’s payment.”); see also ’720 patent at 8:21-8:23 (“The terminal reads
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`payment data from the data carrier and transmits this to a payment validation system for
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`validating the data and authorizing the payment.”). While these examples mention “authorizing
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`payment” and validating data, these are the only portions of the specification that mention this
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`concept in connection with payment for content. On their own, they provide little guidance to
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`the meaning of a phrase that is wholly foreign to the actual claim language. They certainly do
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`not support Defendants’ inevitable, broader non-infringement position that a payment validation
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`system must actually transfer money before allowing a transaction to proceed.
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`In fact, the specification directly contradicts Defendants’ position. The term “payment
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`validation system” is not used to refer solely to credit card processors and banking systems.
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`Rather, this term may also refer to a system that validates (or “authenticates,” but not
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`“authorizes”) payment data without performing the additional functions of an actual credit card
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`8
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`Case 6:13-cv-00448-KNM Document 175 Filed 06/13/14 Page 15 of 43 PageID #: 3421
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`or banking processing system. See generally ’720 patent at 13:53-13:62. The specification
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`provides several examples to illustrate this point. In one example, it describes a type of payment
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`data that consists of a “publicly verifiable digital signature” that performs a similar role to
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`checks. See ’720 patent at 13:53-13:60. Because this form of payment data is “publicly
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`verifiable,” a data supplier can itself be a payment validation system that is able to validate the
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`payment data without first forwarding it to an e-payment system:
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`In such a signature-transporting arrangement, payment data may be
`validated using public keys and thus payment authentication need
`not be performed by the e-payment system but may instead be
`performed by, for example, a data access terminal or data supply
`system computer, using payment management code.
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`’720 patent at 13:53-13:57. Thus, the specification teaches that a data supplier—an entity that
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`does not process financial transactions—may have its own “payment validation system” for
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`validating payment data. See ’720 patent 8:64-8:65 (explaining that a “payment validation
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`system may be part of the data supplier’s computer systems”).
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`The specification also explains that, when the data supplier is the one validating the
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`payment data, it can later contact a separate e-payment system for “reimbursement or transfer of
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`monetary value.” See ’720 patent at 13:60-13:62; see also ’720 patent at 23:25-23:33
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`(explaining that, in embodiments where payment is made directly to the data supplier, the data
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`supplier may receive actual payment from the e-payment system “concurrently with the content
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`access and download process, or at some later stage”). The claims should not be construed to
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`exclude these embodiments. Because the patents disclose some payment validation systems that
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`only validate payment, and because none of the claims require the payment validation system to
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`authorize payment, Defendants proposal should be rejected.
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`2.
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`Defendants’ proposal imports unnecessary functional requirements into
`the claims.
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`Case 6:13-cv-00448-KNM Document 175 Filed 06/13/14 Page 16 of 43 PageID #: 3422
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`Even if the patents did not disclose a payment validation system located at a data
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`supplier, Defendants’ proposal is improper. “The fact that a patent asserts that an invention
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`achieves several objectives does not require that each of the claims be construed as limited to
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`structures that are capable of achieving all of the objectives.” See Liebel–Flarsheim Co. v.
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`Medrad, Inc., 358 F.3d 898, 908 (Fed. Cir. 2004). Similarly, when a patent discloses a structure
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`with multiple functions, a claim that recites that structure is not limited to embodiments that
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`satisfy all of the functions recited in the patent. See Phillips, 415 F.3d at 1325 (“While that
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`statement makes clear the invention envisions baffles that serve that function, it does not imply
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`that in order to qualify as baffles within the meaning of the claims, the internal support structures
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`must serve the projectile-deflecting function in all the embodiments of