Case CBM2015-00126
`Patent 8,118,221 B2
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`____________________________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`____________________________
`
`GOOGLE INC.,
`Petitioner
`
`v.
`
`SMARTFLASH LLC,
`Patent Owner
`
`____________________________
`
`Case CBM2015-00126
`Patent 8,118,221 B2
`
`____________________________
`
`PETITIONER’S REPLY TO PATENT OWNER’S RESPONSE
`
`
`
`
`
`

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`Case CBM2015-00126
`Patent 8,118,221 B2
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`
`TABLE OF CONTENTS
`
`Page
`
`I.
`
`II.
`
`INTRODUCTION ........................................................................................... 1
`
`PETITIONER’S RESPONSE TO PATENT OWNER’S
`STATEMENT OF FACTS .............................................................................. 2
`
`III. THE ’221 PATENT IS A COVERED BUSINESS METHOD
`PATENT .......................................................................................................... 3
`
`A.
`
`B.
`
`Claim 3 Claims Subject Matter That Is Financial In Nature................. 3
`
`Claim 3 Does Not Cover A Technological Invention ........................... 3
`
`IV. CLAIM 3 IS PATENT INELIGIBLE ............................................................. 4
`
`A.
`
`B.
`
`Claim 3 Is Directed To An Abstract Idea .............................................. 4
`
`Claim 3 Does Not Disclose An “Inventive Concept” That Is
`“Significantly More” Than The Abstract Idea ...................................... 8
`
`V.
`
`CLAIM 3 IS NOT ANALOGOUS TO THE CLAIMS IN DDR .................. 10
`
`VI. PATENT OWNER’S PREEMPTION ARGUMENTS ARE
`MISPLACED ................................................................................................. 12
`
`VII. PATENT OWNER’S OTHER ARGUMENTS ARE IRRELEVANT
`TO THE MERITS.......................................................................................... 14
`
`A. Dr. Tygar Was Not Required To Recite An “Evidentiary
`Standard” Or A “Standard For Statutory Subject Matter” .................. 14
`
`B.
`
`C.
`
`Patent Owner’s Construction Of “Payment Data” Ignores The
`Explicit Teachings Of The ’221 Patent ............................................... 15
`
`Patent Owner’s Arguments Regarding Estoppel And
`Constitutionality Are Unfounded ........................................................ 15
`
`VIII. CONCLUSION .............................................................................................. 15
`
`
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`Case CBM2015-00126
`Patent 8,118,221 B2
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`
`Google
`Exhibit No.
`1001
`
`1002
`
`1003
`
`1004
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`1005
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`1006
`
`1007
`
`1008
`
`1009
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`1010
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`1011
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`1012
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`1013
`
`1014
`
`1015
`
`LIST OF EXHIBITS
`
`Description
`
`U.S. Patent No. 8,118,221 to Racz et al. (“the ’221 Patent”)
`
`Declaration of Dr. Justin Douglas Tygar Regarding the ’221
`Patent
`
`Curriculum Vitae of Dr. Justin Douglas Tygar
`
`PCT Publication No. WO 99/07121 (“Fetik”)
`
`U.S. Patent No. 5,790,423 to Lau et al.
`
`SOFTBOOK PRESS—Secure Information Delivery to a
`Distributed Workforce, CIO Magazine, Aug. 1, 1999
`
`Kevin Maney, Electronic Books to Hit the Shelves, New Straits
`Times (Computimes), Aug. 24, 1998
`
`Liquid Audio, Music on the Net—A Topographic Tour of the
`Online Music World (1997)
`
`Liquid Audio Indie 1000 Program, http://www.liquidaudio.com
`(archived Feb. 11, 1998)
`
`Reserved
`
`Report and Recommendation Regarding Claim Construction,
`Smartflash LLC v. Samsung Elecs. Co., No. 6:13-cv-448, Dkt.
`274 (E.D. Tex. Sept. 24, 2014)
`
`Plaintiffs Smartflash LLC’s and Smartflash Technologies
`Limited’s Opening Claim Construction Brief, Smartflash LLC v.
`Samsung Elecs. Co., No. 6:13-cv-448, Dkt. 175 (E.D. Tex. June
`13, 2014)
`
`Reserved
`
`A.M. Turing, On Computable Numbers, with an Application to
`the Entscheidungsproblem, Proceedings of the London
`Mathematical Society, Vol. 42:2, pp. 230-265 (Nov. 12, 1936)
`
`Plaintiffs’ Original Complaint for Patent Infringement,
`Smartflash LLC v. Apple Inc., No. 6:13-cv-447, Dkt. 1 (E.D. Tex.
`May 29, 2013)
`
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`Case CBM2015-00126
`Patent 8,118,221 B2
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`Google
`Exhibit No.
`1016
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`1017
`
`1018
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`1019
`
`1020
`
`1021
`
`1022
`
`1023
`
`1024
`
`1025
`
`1026
`
`1027
`
`1028
`
`Description
`
`U.S. Patent No. 8,118,221 Claim Chart—Google (Android),
`Exhibit 4 to Plaintiffs Smartflash LLC and Smartflash
`Technologies Limited’s P.R. 3-1 and 3-2 Disclosure of Asserted
`Claims and Infringement Contentions, Smartflash LLC v. Google
`Inc., No. 6:14-cv-435 (E.D. Tex. Aug. 22, 2014) (excerpted)
`
`Reserved
`
`U.S. Patent No. 7,942,317 to Racz et al. (“the ’317 Patent”)
`
`U.S. Patent No. 8,033,458 to Hulst et al. (“the ’458 Patent”)
`
`U.S. Patent No. 8,061,598 to Racz et al. (“the ’598 Patent”)
`
`U.S. Patent No. 7,334,720 to Hulst et al. (“the ’720 Patent”)
`
`Roger A. Cunningham et al., The Law of Property (2d ed. 1993)
`(excerpted)
`
`Michael H. Harris, History of Libraries in the Western World
`(4th ed. 1999) (excerpted)
`
`David Broderick, The First Toll Roads—Ireland’s Turnpike
`Roads 1729-1858 (2002) (excerpted)
`
`Proposed Protective Order
`
`Declaration of Charles K. Verhoeven in Support of Google’s
`Unopposed Motion for Pro Hac Vice Admission
`
`Declaration of Melissa J. Baily in Support of Google’s
`Unopposed Motion for Pro Hac Vice Admission
`
`Declaration of Kevin A. Smith in Support of Google’s
`Unopposed Motion for Pro Hac Vice Admission
`
`
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`Case CBM2015-00126
`Patent 8,118,221 B2
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`
`TABLE OF ABBREVIATIONS
`
`Abbreviation
`
`P
`
`PR
`
`R
`
`Text
`
`Petitioner’s Petition
`
`Patent Owner’s Preliminary Response
`
`Patent Owner’s Response
`
`
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`v
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`Case CBM2015-00126
`Patent 8,118,221 B2
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`I.
`
`INTRODUCTION
`
`The outcome of this proceeding should be governed by the Board’s Final
`
`Written Decision in CBM2014-00194. In that Decision, the Board found Claim 32
`
`of the same patent at issue here—U.S. Patent No. 8,118,221—unpatentable under
`
`Section 101 for failure to claim patent-eligible subject matter. The claim
`
`challenged in this proceeding (Claim 3) is materially identical to Claim 32 in all
`
`relevant respects. Indeed, the only substantive difference between the claims is
`
`Claim 32’s recitation of an additional limitation not required by Claim 3:
`
`Claim 32 (Held Unpatentable Under
`Section 101 in CBM2014-00194)
`A data access terminal for retrieving
`data from a data supplier and providing
`the retrieved data to a data carrier, the
`terminal comprising:
`a first interface for communicating with
`the data supplier;
`a data carrier interface for interfacing
`with the data carrier;
`a program store storing code; and
`
`a processor coupled to the first interface,
`the data carrier interface, and the
`program store for implementing the
`stored code, the code comprising:
`
`code to read payment data from the data
`carrier and to forward the payment data
`to a payment validation system;
`code to receive payment validation data
`from the payment validation system;
`code responsive to the payment
`
`Claim 3 (At Issue Here)
`
`A data access terminal for retrieving
`data from a data supplier and providing
`the retrieved data to a data carrier, the
`terminal comprising:
`a first interface for communicating with
`the data supplier;
`a data carrier interface for interfacing
`with the data carrier;
`a program store storing code
`implementable by a processor; and
`a processor, coupled to the first
`interface, to the data carrier interface
`and to the program store for
`implementing the stored code, the code
`comprising:
`code to read payment data from the data
`carrier and to forward the payment data
`to a payment validation system;
`code to receive payment validation data
`from the payment validation system;
`code responsive to the payment
`
`
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`validation data to retrieve data from the
`data supplier and to write the retrieved
`data into the data carrier;
`code responsive to the payment
`validation data to receive at least one
`access rule from the data supplier and to
`write the at least one access rule into the
`data carrier, the at least one access rule
`specifying at least one condition for
`accessing the retrieved data written into
`the data carrier, the at least one
`condition being dependent upon the
`amount of payment associated with the
`payment data forwarded to the payment
`validation system; and
`code to retrieve from the data supplier
`and output to a user-stored data
`identifier data and associated value data
`and use rule data for a data item
`available from the data supplier.
`
`validation data to retrieve data from the
`data supplier and to write the retrieved
`data into the data carrier;
`
`
`code to retrieve from the data supplier
`and output to a user-stored data
`identifier data and associated value data
`and use rule data for a data item
`available from the data supplier.
`
`Because Claim 3 is a subset of the limitations already found patent-ineligible in
`
`CBM2014-00194, it is even more abstract than Claim 32.
`
`The Response does not to change this result. To the contrary, Patent Owner
`
`simply restates—often verbatim—arguments that it has already made in this and
`
`other proceedings and that the Board has already addressed and rejected. Like
`
`Claim 32, the Board should hold that Claim 3 is unpatentable under Section 101.
`
`II.
`
`PETITIONER’S RESPONSE TO PATENT OWNER’S STATEMENT
`OF FACTS
`
`The phrases “preponderance of the evidence” and “more likely than not” do
`
`not appear in Dr. Tygar’s declaration or the cited deposition excerpt. Experts are
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`not required to recite an evidentiary standard for their opinion to be given weight.
`
`See, e.g., Vibrant Media, Inc. v. General Elec. Co., IPR2013-00172, Pap. 50 at 42
`
`(July 28, 2014); CBM2014-00102, Pap. 52 at 6. Petitioner otherwise denies Patent
`
`Owner’s allegations.
`
`Petitioner further states the following material fact: Patent Owner did not
`
`submit any expert opinion in this proceeding.
`
`III. THE ’221 PATENT IS A COVERED BUSINESS METHOD PATENT
`
`A. Claim 3 Claims Subject Matter That Is Financial In Nature
`
`Claim 3 is financial in nature. (P at 6-7.) With the exception of a single
`
`additional introductory sentence, Patent Owner copies and pastes its argument
`
`from its Preliminary Response. (Compare R at 15-20 with PR at 30-35.) The
`
`Board has already rejected that argument. CBM2015-00126, Pap 8 at 6.
`
`B. Claim 3 Does Not Cover A Technological Invention
`
`Patent Owner presents no reason for the Board to reverse its Institution
`
`Decision and find that Claim 3 is directed to a technological invention. Patent
`
`Owner argues that “[a]t least one technological problem solved by the data access
`
`terminals of claims 1 and 3 is the problem of data piracy.” (R at 21.) But, as the
`
`Board has already held, data piracy is a business, not technological, problem.
`
`CBM2015-00126, Pap. 8 at 8-9; CBM2014-00194, Pap. 9 at 11; P at 8-9.
`
`Patent Owner also argues—with little elaboration—that elements of Claim 3
`
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`are “technological features.” (R at 21-22.) But “the ’221 patent makes clear that
`
`the asserted novelty of the invention is not in any specific improvement of
`
`software or hardware.” CBM2015-00126, Pap. 8 at 8; CBM2014-00194, Pap. 9 at
`
`10; CBM2015-00015, Pap. 23 at 14. The technologies and data recited in Claim 3
`
`are all generic and known. See id.; Ex. 1002 ¶¶ 60-64.
`
`IV. CLAIM 3 IS PATENT INELIGIBLE
`
`A. Claim 3 Is Directed To An Abstract Idea
`
`Claim 3 is directed to an abstract idea. (P at 20-25.) As the Board has
`
`already found in connection with Claim 32, Claim 3 “is directed to performing the
`
`fundamental economic practice of conditioning and controlling access to content
`
`based on payment.” CBM2014-00194, Pap. 51 at 8.
`
`Patent Owner argues that Claim 3 cannot be directed to an abstract idea
`
`because it claims “a data access terminal, which is a machine” with “real-world
`
`physical components.” (R at 22-23; see also id. at 23 (citing testimony from Dr.
`
`Tygar that a data access terminal is “a physical thing”).) But the test for whether a
`
`claim satisfies step one of the Alice inquiry and is directed to an abstract idea is not
`
`whether the claim includes physical components. To the contrary, the Federal
`
`Circuit has expressly held that the fact “that a computer exists in the physical
`
`rather than purely conceptual realm is beside the point.” Mortgage Grader, Inc. v.
`
`First Choice Loan Servs., Inc., 811 F.3d 1314, 1325 (Fed. Cir. 2016). Indeed, the
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`Federal Circuit has repeatedly invalidated claims under Section 101 that are
`
`directed to “machines” with “real-world physical components.” See, e.g.,
`
`Intellectual Ventures I LLC v. Capital One Bank, 792 F.3d 1363, 1369 (Fed. Cir.
`
`2015); Cyberfone Sys., LLC v. CNN Interactive Grp., Inc., 558 F. App’x 988, 992
`
`(Fed. Cir. 2014); Content Extraction & Trans. LLC v. Wells Fargo Bank, Nat.
`
`Ass’n, 776 F.3d 1343, 1345 (Fed. Cir. 2014). Patent Owner ignores this precedent.
`
`Patent Owner also asserts—without elaboration—that “Claim 3 is not of the
`
`nature of the ‘computer that is a tangible system (in § 101 terms, a “machine”)’
`
`that ‘claims a principle of the physical or social sciences by reciting a computer
`
`system configured to implement the relevant concept’ warned against in Alice.” (R
`
`at 23.) As discussed in Google’s Petition (and found by the Board with respect to
`
`Claim 32), that is exactly what Claim 3 is. (P at 20-25; CBM2014-00194, Pap. 51
`
`at 8.) Claim 3 is simply the abstract concept of “conditioning and controlling
`
`access to content based on payment”—a “fundamental economic practice” and
`
`“building block of the modern economy”1—described using generic computer
`
`hardware and functions. (P at 21-31; Ex. 1002 ¶¶ 56-66.) Indeed, all of the
`
`functional limitations of Claim 3 can be performed without a computer, see Ex.
`
`1002 ¶ 64, indicating that the claim is directed to the “disembodied concept” of
`
`
`1 CBM2014-00194, Pap. 51 at 8; Alice v. CLS, 134 S. Ct. 2347, 2356 (2014).
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`conditioning and controlling access based on payment. E.g., SAP Am. Inc. v.
`
`Versata Dev. Grp., Inc., CBM2012-00001, Pap. 70 at 29 (June 11, 2013).
`
`The two decisions Patent Owner cites—Hulu, LLC et al., v. iMTX Strategic,
`
`LLC and Google Inc. v. Network-1 Technologies, Inc.—are distinguishable from
`
`the claim at issue here. As an initial matter, both decisions are decisions denying
`
`institution. Here, institution has already been granted. In Hulu, the Board
`
`expressly found that the detailed claims at issue were not directed to “fundamental
`
`economic or conventional business practices,” but instead recited a specific system
`
`for transferring computer files that addressed a problem “specifically arising in the
`
`realm of computer networks” that was “rooted in non-abstract computer network
`
`technology.” CBM2015-00147, Pap. 14 at 13-14. Further, the Board found that
`
`the claims at issue were not simply implemented on generic computer hardware,
`
`but required a specialized “media server” and “transaction server . . . that are not
`
`‘generic computers.’” Id. at 14. Here, Claim 3 is directed to a fundamental
`
`economic and business practice. (P at 21-25; CBM2014-00194, Pap. 51 at 8.)
`
`Further, all hardware recited in Claim 3 is generic and conventional, which Patent
`
`Owner does not dispute (see R at 36-43).2
`
`
`2 Claim 3 recites a “data access terminal,” “data supplier,” “data carrier,”
`
`“interface,” “program store,” “processor,” and “payment validation system.” None
`
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`In Network-1 Technologies, the claims at issue related to identifying a digital
`
`work “without the need to modify the work” that involved (among other things) a
`
`“non-exhaustive, near neighbor search.” CBM2015-00113, Pap. 7 at 3-4. The
`
`Board found that there was no non-digital analog to the claims, and that the claims
`
`were “necessarily rooted in computer technology in order to overcome a problem
`
`specifically arising in the realm of computer technology.” Id. at 13. Here, all of
`
`the functional limitations of Claim 3 can be performed without a computer. See
`
`Ex. 1002 ¶ 64. Further, like Claim 32, Claim 3 is not “rooted in computer
`
`technology in order to overcome a problem specifically arising in the realm of
`
`
`of these components are specialized. E.g., Ex. 1002 ¶ 60; see also CBM2014-
`
`00194, Pap. 9 at 10. Indeed, the patent itself admits that the “data access terminal”
`
`may be “a conventional computer” (Ex. 1001 at 4:4-5), the “data carrier” may be a
`
`“standard smart card” (id. at 11:28-29), and the “payment validation system” may
`
`be any e-payment system using “for example, MONDEX, Proton, and/or Visa cash
`
`compliant standards” (id. at 7:11-16, 8:18-22, 13:36-38). See also CBM2014-
`
`00194, Pap. 51 at 11 (“The ’221 patent specification treats as well-known all
`
`potentially technical aspects of claim 32.”).
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`computer technology.” E.g., CBM2014-00194, Pap. 51 at 15-16.3
`
`B. Claim 3 Does Not Disclose An “Inventive Concept” That Is
`“Significantly More” Than The Abstract Idea
`
`As the Board has already held in connection with Claim 32, Claim 3 “does
`
`not add an inventive concept sufficient to ensure that the patent in practice amounts
`
`to more than a patent on the abstract idea itself.” CBM2014-00194, Pap. 51 at 10;
`
`see also P at 25-31. Instead, Claim 3 simply recites generic computer components
`
`and functions along with insignificant pre- and post-solution activity. (Id.) Patent
`
`Owner does not seriously dispute these arguments. Instead, Patent Owner’s
`
`Response once again rehashes arguments that have already been rejected.
`
`First, Patent Owner at several points quotes the Report and Recommendation
`
`
`3 Patent Owner also appears to argue that Claim 3 is not directed to an abstract
`
`idea simply because it contains the limitation “code to retrieve from the data
`
`supplier and output to a user-stored data identifier data. . . .” (R at 24.) This
`
`limitation is also present in Claim 32. Further, it is nothing more than insignificant
`
`post-solution activity. (P at 27-28.) Patent Owner does not explain how the mere
`
`act of outputting information to a user removes the claim from the realm of an
`
`abstract idea. Cf. Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 712 (Fed. Cir.
`
`2014) (invalidating claim reciting, inter alia, “facilitating the display of a sponsor
`
`message to the consumer” and “presenting at least one query to the consumer”).
`
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`from the Eastern District of Texas, which states that the “asserted claims . . . recite
`
`specific ways of using distinct memories, data types, and use rules that amount to
`
`significantly more than the underlying abstract idea.” (R at 36, 40.) Patent Owner
`
`makes no argument beyond this bare quotation, nor does it explain how it supports
`
`subject-matter eligibility with respect to Claim 3. As the Board has found with
`
`respect to Claim 32, Claim 3 “does not recite any particular or ‘distinct
`
`memories.’” CBM2014-00194, Pap. 51 at 12. Further, the simple reference to
`
`different data types is insufficient to supply an inventive concept. CBM2014-
`
`00194, Pap. 51 at 13. And Claim 3 does not recite the use of “use rules”; rather, it
`
`merely recites outputting “use rule data,” which is simply insignificant post-
`
`solution activity. (P at 27-28; see also Ultramercial, 772 F.3d at 712.)
`
`Second, Patent Owner argues that Google has not carried its burden of proof
`
`because Dr. Tygar “did not formulate in his own mind what minimum basic
`
`structure would be required for a device to practice the abstract idea of controlling
`
`access based on payment.” (R at 27.) Patent Owner cites no law in support of this
`
`argument. The Supreme Court’s test in Alice does not require that a court or expert
`
`formulate “what minimum basic structure would be required” to implement an
`
`abstract idea. Nor would such an inquiry make sense. Rather, the Alice inquiry
`
`asks whether the structure and functions recited in the claims are something more
`
`than “generic” and “purely conventional,” such that they supply an inventive
`
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`concept. Alice, 134 S. Ct. at 2358. Dr. Tygar correctly considered the components
`
`and functions recited in Claim 3 and concluded that those components and
`
`functions are purely conventional and generic. Ex. 1002 ¶¶ 60, 64.
`
`V. CLAIM 3 IS NOT ANALOGOUS TO THE CLAIMS IN DDR
`
`Patent Owner repeats—again almost verbatim—its arguments that Claim 3
`
`is analogous to the claims in DDR. (R at 29-36.) These arguments fail.
`
`CBM2014-00194, Pap. 51 at 14-18.
`
`First, Patent Owner argues that, like the claims in DDR, “the claims are
`
`rooted in computer technology in order to overcome a problem specifically arising
`
`in the realm of computer networks – that of digital data piracy.” (R at 30.) But
`
`“data piracy exists in contexts other than the Internet.” CBM2014-00194, Pap. 51
`
`at 15. For example, the patent itself admits that data piracy was a problem with
`
`compact discs. See Ex. 1001 5:9-12. Further, whatever the problem, the solution
`
`provided by Claim 3 “is not rooted in specific computer technology, but is based
`
`on conditioning and controlling access to content only when payment is validated.”
`
`CBM2014-00194, Pap. 51 at 16.
`
`Second, Patent Owner argues that Claim 3 “function[s] in an unconventional
`
`manner” by (i) “writing the retrieved data into the same carrier as the carrier from
`
`which the payment data was received” and (ii) outputting data to a user. (R at 34.)
`
`Patent Owner provides no explanation as to why it believes these elements are
`
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`unconventional. Patent Owner elsewhere argues that using distinct memories
`
`(which Claim 3 does not) supplies an inventive concept. (R at 36, 40.) Patent
`
`Owner simultaneously argues that using a single memory is unconventional. It is
`
`not. The memory recited in Claim 3 is a “data carrier,” which the patent makes
`
`clear can be a “standard smart card.” Ex. 1001 at 11:33-35. The recitation of a
`
`well-known, generic smart card used for
`
`its
`
`intended purpose
`
`is not
`
`“unconventional,” nor does it override any routine sequence of events. E.g.,
`
`CBM2014-00194, Pap. 51 at 16. Similarly, outputting data is not unconventional.
`
`See Ultramercial, 772 F.3d at 712. Rather, it highlights that Claim 3 is in fact far
`
`closer to Ultramercial than to DDR. Id.
`
`Third, Patent Owner compares Claim 3 to a claim in DDR. (R at 31-33.)
`
`But as the Board has previously recognized, this simply emphasizes the stark
`
`differences between Claim 3 and DDR. E.g., CBM2014-00194, Pap. 51 at 16.
`
`Unlike the claims in DDR, Claim 3 is “specified at a high level of generality,”
`
`which the Federal Circuit has found “insufficient to supply an ‘inventive
`
`concept.’”4 Ultramercial, 772 F.3d at 716; CBM2014-00194, Pap. 51 at 16.
`
`
`4 Patent Owner again argues that Claim 3 is patent eligible because, unlike the
`
`method claims in Ultramercial, it “claims a data access terminal and requires
`
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`VI. PATENT OWNER’S PREEMPTION ARGUMENTS ARE
`MISPLACED
`
`Patent Owner repeatedly argues that Claim 3 is patent eligible and is not “a
`
`patent on the abstract idea itself” because it does not cover all possible methods of
`
`“paying for and controlling access to data.” (E.g., R at 37 (“If the claims [sic] of
`
`the ’221 Patent amounted to a patent on the abstract idea itself, the ’221 Patent
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`would cover all ways of ‘paying for and controlling access to data.’”); id. at 40-43;
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`id. at 43-46.) Patent Owner cites no law in support of its erroneous arguments.
`
`As an initial matter, Patent Owner does not address the correct standard.
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`The Alice inquiry does not ask whether a claim “amount[s] to a patent on the
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`abstract idea itself” (e.g., R at 37, 40). Rather, as discussed above, the question is
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`whether a claim “amounts to significantly more” than a patent on the abstract idea.
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`Ultramercial, 772 F.3d at 714 (quoting Mayo Collaborative Servs. v. Prometheus
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`Labs., Inc., 132 S. Ct. 1289, 1294 (2012).) The Response ignores this question.5
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`concrete structures.” (R at 35.) That Claim 3 is directed to a system rather than a
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`method does not alter the Section 101 analysis. E.g., Alice, 134 S. Ct. at 2351.
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`5 Patent Owner cites testimony from Dr. Tygar that, for example, adding “code
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`to” elements is “more than” a strict recitation of the abstract idea of “controlling
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`access based on payment.” (R at 39.) The relevant question is, however, whether
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`the claim elements amount to “significantly more than” the abstract idea. E.g.,
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`Further, the fact that a claim does not result in total preemption of an
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`abstract idea does not mean that claim is patent eligible. Ariosa Diagnostics, Inc.
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`v. Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir. 2015) (“[T]he absence of
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`complete preemption does not demonstrate patent eligibility.”); see also
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`CBM2015-00059, Pap. 13 at 5; CBM2014-00079, Pap. 28 at 19. Preemption is not
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`a separate test for patent eligibility; rather the question of preemption “[is]
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`inherent in and resolved by the § 101 analysis.” Ariosa, 788 F.3d at 1379
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`(emphasis added). “Where a patent’s claims are deemed only to disclose patent
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`ineligible subject matter under the Mayo framework”—as here—“preemption
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`concerns are fully addressed and made moot.” Id. (emphasis added).
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`Thus, Patent Owner’s arguments that, for example, one “could receive
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`payment over a phone” (R at 38), could implement a “pay per view system” (id. at
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`42), and could control access to content “without a processor” (id. at 44) are all
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`irrelevant. “The alleged existence of a large number of non-infringing, and, thus,
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`non-preemptive alternatives does not alter” the Section 101 analysis “because the
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`question of preemption is inherent in, and resolved by, [the Alice] inquiry.”
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`CBM2014-00194, Pap. 51 at 22.
`
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`Ultramercial, 772 F.3d at 714. Dr. Tygar was clear that they do not. Ex. 1002 ¶¶
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`59-66. Patent Owner provides no evidence to the contrary.
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`VII. PATENT OWNER’S OTHER ARGUMENTS ARE IRRELEVANT TO
`THE MERITS
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`A. Dr. Tygar Was Not Required To Recite An “Evidentiary
`Standard” Or A “Standard For Statutory Subject Matter”
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`Patent Owner argues that Dr. Tygar (i) omitted the “evidentiary standard”
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`from his declaration (R at 5-7) and (ii) applied an unreliable methodology (R at 7-
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`11). Both arguments are baseless. First, the Board has already rejected Patent
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`Owner’s “evidentiary standard” argument in earlier CBMs involving related
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`patents. See, e.g., CBM2014-00102, Pap. 52 at 6-7.
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`Second, Dr. Tygar applied the methodology required under Section 101
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`law. E.g., 1002 ¶¶ 54-55. Patent Owner fails to cite any authority for the
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`proposition that an expert must identify a “false positive rate” or analyze abstract
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`concepts not advanced by either party. (R at 8-11.) Moreover, Patent Owner faults
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`Dr. Tygar for not reading court decisions. (Id. at 8.) But Dr. Tygar did not provide
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`a legal opinion. Rather, he provided a factual opinion based on his analysis of the
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`’221 patent and, specifically, Claim 3, informed by his technical expertise and over
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`34 years of experience in the field (see, e.g., Ex. 1002 ¶¶ 7-13). Dr. Tygar’s
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`testimony is entitled to significant weight, especially in comparison to Patent
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`Owner’s bare attorney argument. See, e.g., Versata, 793 F.3d at 1334 (affirming
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`Board’s reliance on expert testimony that computer-based limitations were well-
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`known); IPR2013-00048, Pap.15 at 22 (“[I]n the face of [petitioner’s] expert
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`testimony. . ., we are not persuaded by this conclusory attorney argument.”).
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`B.
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`Patent Owner’s Construction Of “Payment Data” Ignores The
`Explicit Teachings Of The ’221 Patent
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`Patent Owner’s construction of “payment data” improperly excludes
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`embodiments in the ’221 patent. See, e.g., Ex. 1001 at 6:64-7:1. The Board
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`previously found that the specification “clearly shows that ‘payment data’
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`includes” not only data that can be used to make payment for content, but “data for
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`payments that have already been made.” See, e.g., CBM2014-00102, Pap. 52 at 9
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`(emphasis in original). Patent Owner’s attempt to limit the term to “data that can
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`be used to make a payment” should thus be rejected.
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`Regardless, Patent Owner fails to explain how its construction, if adopted,
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`would save Claim 3 from unpatentability. It would not. As the Board previously
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`found in connection with Claim 32, the Board “need not expressly construe any
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`claim term” to determine patent eligibility. See CBM2014-00194, Pap. 51 at 6.
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`C.
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`Patent Owner’s Arguments Regarding Estoppel And
`Constitutionality Are Unfounded
`
`Patent Owner repeats its arguments regarding estoppel and constitutionality.
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`(Compare R at 47-52 with PR at 25-29.) The Board has correctly rejected these
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`arguments. CBM2014-00194, Pap. 51 at 22; CBM2015-00128, Pap. 8 at 18-19.
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`VIII. CONCLUSION
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`For the foregoing reasons, the Board should hold that, like Claim 32, Claim
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`3 is unpatentable under Section 101.
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`Dated: April 21, 2016
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`Respectfully submitted,
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`/Andrew M. Holmes/
`
`Andrew M. Holmes (Reg. No. 64,718)
`Charles K. Verhoeven
`Melissa J. Baily
`Kevin A. Smith
`QUINN EMANUEL URQUHART &
`SULLIVAN, LLP
`50 California Street, 22nd Floor
`San Francisco, CA 94111
`Telephone: 415-875-6000
`Fax: 415-875-6700
`
`Raymond N. Nimrod (Reg. No. 31,987)
`QUINN EMANUEL URQUHART &
`SULLIVAN, LLP
`51 Madison Avenue, 22nd Floor
`New York, NY 10010
`Telephone: 202-849-7100
`Fax: 212-849-7100
`
`Counsel for Petitioner Google Inc.
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`CERTIFICATE OF SERVICE
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`I hereby certify that on April 21, 2016 I served the foregoing by email to:
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`/Adam Botzenhart/
`Adam Botzenhart
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`SmartFlash-CBM@dbjg.com
`Michael R. Casey (mcasey@dbjg.com)
`J. Scott Davidson (jsd@dbjg.com)
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`Date: April 21, 2016
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