Paper No. ____
`Filed: February 17, 2016
`
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`_____________________________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`_____________________________
`
`IBG LLC and INTERACTIVE BROKERS LLC,
`Petitioners,
`
`v.
`
`TRADING TECHNOLOGIES INTERNATIONAL, INC.,
`Patent Owner.
`_____________________________
`
`Patent No. 6,766,304
`_____________________________
`
`
`
`PETITION FOR COVERED BUSINESS METHOD REVIEW OF
`U.S. PATENT NO. 6,766,304
`
`

`
`
`
`Table of Contents
`
`Page
`
`I.
`
`INTRODUCTION ..................................................................................................... 1
`
`II. MANDATORY NOTICES UNDER 37 C.F.R. § 42.8 .................................................. 2
`
`III. GROUNDS FOR STANDING (37 C.F.R. 42.304(A)) ................................................. 3
`
`A.
`
`B.
`
`C.
`
`Petitioners Have Standing to File a Petition Under 37 C.F.R.
`§ 42.302(a) ................................................................................................ 3
`
`IBG Is Not Estopped Under 37 CFR 42.302(b) by Non-Party
`CQG’s Earlier-Filed CBM Petition, and IBG Is the Sole Party-in-
`Interest in this Proceeding ........................................................................ 4
`
`The ’304 Patent Is Available for Covered Business Method
`Patent Review Under 37 C.F.R. § 42.301 ................................................ 7
`
`1.
`
`2.
`
`3.
`
`4.
`
`The USPTO Has Already Determined that the ’304 Patent
`Is a Covered Business Method Patent ........................................... 9
`a.
`Classification ....................................................................... 9
`b.
`Claim Language ................................................................ 10
`
`The ’304 Patent Is Not for a “Technological Invention” ............ 11
`
`The Claimed Subject Matter of the ’304 Patent as a Whole
`Does Not Recite a Technical Feature that Is Novel and
`Unobvious Over the Prior Art ..................................................... 12
`
`The Claimed Subject Matter of the ’304 Patent as a
`Whole Does Not Solve a Technical Problem Using a
`Technical Solution ....................................................................... 15
`a.
`Plain Language .................................................................. 15
`b.
`Legislative History ............................................................ 16
`
`IV.
`
`IDENTIFICATION OF CHALLENGE UNDER 37 C.F.R. § 42.304(B) ........................ 19
`
`Specific Statutory Grounds of Challenge ............................................... 19
`
`A Person of Ordinary Skill in the Art .................................................... 19
`
`Claim Construction ................................................................................. 19
`
`A.
`
`B.
`
`C.
`
`-i-
`
`

`
`
`V.
`
`DETAILED EXPLANATION OF REASONS THAT CLAIMS 1−40 OF THE ’304
`PATENT ARE UNPATENTABLE ............................................................................ 20
`
`A.
`
`Ground 1: Claims 1−40 Are Unpatentable Under 35 U.S.C. § 101....... 20
`
`1.
`
`2.
`
`3.
`
`4.
`
`New PTO Guidelines ................................................................... 21
`a.
`Ultramercial, LLC v. Hulu, LLC, 657 F.3d 1323
`(Fed. Cir. 2014) ................................................................. 22
`DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d
`1245 (Fed. Cir. 2014) ....................................................... 23
`
`b.
`
`Indicators of Abstract Ideas ......................................................... 25
`
`Economic Practices Are Abstract Ideas ...................................... 27
`
`b.
`
`The ’304 Patent Is Not Patentable Under 35 U.S.C. § 101
`Because All of Its Claims Are Directed to an Abstract Idea ...... 28
`a.
`The Claims of the ’304 Patent Are Directed to an
`Abstract Idea...................................................................... 30
`The Claim Elements—Either Separately or as an
`Ordered Combination—Do Not Provide
`“Something More” ............................................................ 33
`Claims Fail the Machine-or-Transformation Test ............ 38
`Dependent Claims ............................................................. 41
`Other Related TT Patents Have Been Determined to
`Be Abstract by the Board .................................................. 41
`
`c.
`d.
`e.
`
`VI. CONCLUSION ...................................................................................................... 45
`
`VII. PAYMENT OF FEES UNDER 37 C.F.R. §§ 42.15(A) AND 42.103 .......................... 46
`
`VIII. APPENDIX – LIST OF EXHIBITS.................................................................. 47
`
`-ii-
`
`

`
`
`
`I.
`
`INTRODUCTION
`
`Pursuant to the provisions of 35 U.S.C. § 321 and § 18 of the Leahy-Smith
`
`America Invents Act (“AIA”), and to 37 C.F.R. Part 42, IBG LLC and Interactive
`
`Brokers LLC, (collectively, “IBG” or “Petitioners”) hereby request review of United
`
`States Patent No. 6,766,304 to Kemp et al. (hereinafter “the ’304 patent,” Ex. 1001)
`
`that issued on June 20, 2004, and is owned by Trading Technologies International,
`
`Inc. (“TT” or “Patent Owner”). This petition demonstrates, by a preponderance of the
`
`evidence, it is more likely than not that the claims of the ’304 patent are unpatentable
`
`because they are directed to an abstract idea. Accordingly, CBM review of the ’304
`
`patent should be granted and claims 1-40 should be found unpatentable.
`
`This petition is filed along with a motion for joinder with CBM2015-00161
`
`(“the ’161 CBM review”), in which petitioners TradeStation Group, Inc. and
`
`TradeStation Securities, Inc. (collectively, “TradeStation”) filed a petition on July 20,
`
`2015 challenging claims 1-40 of the ’340 patent. The Board instituted trial in the ’161
`
`CBM review on January 27, 2016. This petition proposes the same ground of
`
`rejection instituted in the ’161 CBM review, and relies on the same analysis and
`
`evidence.1 If joinder is not granted, Petitioners respectfully request that a proceeding
`
`be instituted based on this petition alone.
`
`
`
`1 The petition in the ’161 CBM review included an additional ground of challenge
`
`based on § 112. The Board declined to institute trial on that ground. IBG has omitted
`
`that ground from this petition.
`
`-1-
`
`

`
`
`II. MANDATORY NOTICES UNDER 37 C.F.R. § 42.8
`
`Real Party-in-Interest (37 C.F.R. § 42.8(b)(1)): IBG LLC and Interactive
`
`Brokers LLC are the real parties-in-interest.
`
`Related Matters (37 C.F.R. § 42.8(b)(2)): Petitioners are aware of the
`
`following matters that may affect, or be affected by, a decision in this proceeding: GL
`
`Trade Am., Inc. v. Trading Tech. Int'l, Inc., 1:11-cv-001558 (N.D. Ill.); TT v.
`
`TradeHelm, Inc., 1:10-cv-00931 (N.D. Ill.); TT v. Rosenthal Collins Group, LLC,
`
`1:10-cv-00929 (N.D. Ill.); TT v. Open E Cry, LLC, et al., 1:10-cv-00885 (N.D. Ill.);
`
`TT v. thinkorswim Group, Inc., et al., 1:10-cv-00883 (N.D. Ill.); TT v. Tradestation
`
`Sec., Inc., et al., 1:10-cv-00884 (N.D. Ill.); TT v. FuturePath Trading, LLC, 1:10-cv-
`
`00720 (N.D. Ill.); TT v. Stellar Trading Sys., Ltd., et al., 1:10-cv-00882 (N.D. Ill.); TT
`
`v. Cunningham Trading Sys., LLC, et al., 1:10-cv-00726 (N.D. Ill.); TT v. BGC
`
`Partners, Inc., 1:10-cv-00715 (N.D. Ill.); TT v. CQG, Inc., et al., 1:05-cv-04811 (N.D.
`
`Ill.); TT v. IBG LLC, et al., 1:10-cv-00721 (N.D. Ill.); TT v. Orc Software, Inc., et al.,
`
`1:05-cv-06265 (N.D. Ill.); TT v. FuturePath Trading, LLC, 1:05-cv-05164 (N.D. Ill.);
`
`TT v. Transmarket Group, LLC, 1:05-cv-05161 (N.D. Ill.); TT v. FFastFill PLC, Inc.,
`
`1:05-cv-04449 (N.D. Ill.); TT v. Strategy Runner, Ltd., 1:05-cv-04357 (N.D. Ill.); TT
`
`v. Rolfe & Nolan Sys., Inc., et al., 1:05-cv-04354 (N.D. Ill.); TT v. RTS Realtime Sys.,
`
`Inc., et al., 1:05-cv-04332 (N.D. Ill.); TT v. Peregrine Fin. Group, Inc., 1:05-cv-04137
`
`(N.D. Ill.); TT v. GL Consultants, Inc., et al., 1:05-cv-04120 (N.D. Ill.); Rosenthal
`
`Collins Group, LLC v. TT, 1:05-cv-04088 (N.D. Ill.); TT v. Ninja Trader, LLC, 1:05-
`
`cv-03953 (N.D. Ill.); TT v. Patsystems NA LLC, et al., 1:05-cv-02984 (N.D. Ill.); TT v.
`
`Man Group PLC, et al., 1:05-cv-02164; TT v. Refco Group, Ltd., LLC, 1:05-cv-01079
`
`-2-
`
`

`
`
`
`(N.D. Ill.); TT v. Kingstree Trading, 1:04-cv-06740 (N.D. Ill.); TT v. Goldenberg
`
`Hehmeyer, 1:04-cv-06278 (N.D. Ill.); TT, et al. v. eSpeed, Inc., 1:04-cv-05312 (N.D.
`
`Ill.).
`
`Lead and Back-Up Counsel (37 C.F.R. § 42.8(b)(3))
`
`Lead Counsel: Michael T. Rosato (Reg. No. 52,182)
`
`Back-Up Counsel: Matthew A. Argenti (Reg. No. 61,836)
`
`Back-Up Counsel: Robert E. Sokohl (Reg. No. 36,013)
`
`Service Information – 37 C.F.R. § 42.8(b)(4). Petitioners hereby consent to
`
`electronic service.
`
`Email: mrosato@wsgr.com; margenti@wsgr.com; RSOKOHL@skgf.com
`
`Post: WILSON SONSINI GOODRICH & ROSATI, 701 Fifth Avenue, Suite 5100,
`
`
`
`Seattle, WA 98104-7036
`
`Tel.: 206-883-2529
`
`Fax: 206-883-2699
`
`III. GROUNDS FOR STANDING (37 C.F.R. 42.304(A))
`
`A.
`
`Petitioners Have Standing to File a Petition Under 37 C.F.R.
`§ 42.302(a)
`
`Petitioners certify that the ‘304 patent is available for CBM because TT sued
`
`IBG for infringement of the ’304 patent. See TT v. IBG LLC, 1:10-cv-721 (N.D. Ill.).
`
`Petitioners are not barred or estopped from requesting CBM review. As explained
`
`below, it is more likely than not that at least one claim of the ’304 patent is invalid
`
`under 35 U.S.C. § 101. Moreover, CBM review is available for the ’304 patent for
`
`the reasons set forth below.
`
`-3-
`
`

`
`
`
`B.
`
`IBG Is Not Estopped Under 37 CFR 42.302(b) by Non-Party
`CQG’s Earlier-Filed CBM Petition, and IBG Is the Sole Party-in-
`Interest in this Proceeding
`
`On January 9, 2015, CQG, Inc. and CQGT, LLC (collectively, “CQG”) jointly
`
`filed a CBM petition on the ’304 patent that was denied on July 10, 2015 under 35
`
`U.S.C. § 325(a)(1) and 37 C.F.R. § 43.302(c) because CQG had previously filed a
`
`declaratory judgment action against TT.2 The merits of CQG’s petition were not
`
`reached. See CQG, Inc. v. Trading Technologies Int’l, Inc., CBM 2015-00057, Paper
`
`13. In addition to presenting the same analysis and evidence as relied upon in
`
`TradeStation’s petition (CBM2015-00161), portions of this petition and its exhibits
`
`are substantially identical to CQG’s petition and exhibits (except the portions
`
`concerning the effect of the declaratory judgment action have been removed). Any
`
`argument by TT that IBG was a real-party-in-interest to CQG’s petition, and thus is
`
`estopped from filing this petition, is without merit, for several independent reasons.
`
`First, IBG and CQG are separate unrelated corporate entities with no common
`
`ownership and no common control. Nor do they even have a commercial relationship
`
`that could conceivably bear on issues of privity or real-party-in-interest for this
`
`
`
`2 CQG’s previously-filed declaratory judgment action had been dismissed without
`
`prejudice; however, the Board found that when CQG amended its answer in response
`
`to a later-filed infringement action to include its earlier-filed declaratory claims, “it
`
`was as if the claims from the [declaratory judgment] action were continued into the
`
`[infringement action],” and accordingly CQG was barred from seeking CBM review.
`
`-4-
`
`

`
`
`
`petition. While they are both accused of infringing the same patent (albeit in separate
`
`lawsuits), the Board has repeatedly held that a non-party’s status as a co-defendant
`
`and/or co-member of a joint defense group is insufficient to render that non-party a
`
`real party in interest. See, e.g., Petroleum Geo-Servs. Inc. v. WesternGeco LLC,
`
`IPR2014-00687, Paper 33 at 16 (PTAB Dec. 15, 2014) (holding petitioners and non-
`
`party’s shared interest in invalidating patent at issue, “collaborat[ion] together, and
`
`invo[cation of the] common interest privilege with respect to sharing potentially
`
`invalidating prior art references” were insufficient to render non-party a real-party-in-
`
`interest); accord JP Morgan Chase & Co. et al v. Maxim Integrated Products, Inc.,
`
`CBM2014-00179, Paper 11 at 13 (PTAB Feb. 20, 2015).
`
`Second, there can be no question that IBG had nothing to do with the CQG
`
`declaratory judgment (“DJ”) action that was the basis of the Board’s refusal to
`
`institute CQG’s request for CBM review. CQG filed that action in August 17, 2005,
`
`in the District of Colorado (many years before TT accused IBG of infringement).
`
`Shortly thereafter, TT sued CQG for infringement in the Northern District of Illinois.
`
`Ultimately, CQG’s declaratory judgment action was transferred to Illinois, then
`
`dismissed without prejudice shortly before CQG amended its answer in Illinois to
`
`include, as counterclaims, its DJ claims from its Colorado action. Those
`
`counterclaims were thus asserted by CQG in Illinois in December 2006, and the
`
`CQG case was tried to a jury earlier this year.
`
`IBG, by contrast, was not sued by TT until 2010. That litigation remains in its
`
`very early stages. IBG had no involvement, influence, control, or even knowledge of
`
`CQG’s 2005 declaratory judgment action in Colorado, nor did it participate in TT’s
`
`-5-
`
`

`
`
`
`2005 Illinois case against CQG. Thus, any suggestion that the CQG 2005 declaratory
`
`judgment action somehow estops IBG from filing the instant petition under 35 U.S.C.
`
`§ 325(a)(1) and/or 37 C.F.R. § 43.302(c) would be baseless.
`
`Third, the similarity of IBG’s petition and CQG’s petition does not change the
`
`fact that IBG is the only real-party-in-interest for this petition. The Trial Practice
`
`Guide explains that, in general, a real-party-in-interest is a “party that desires review
`
`of the patent” or “at whose behest the petition has been filed.” Office Patent Trial
`
`Practice Guide, 77 Fed. Reg. 48,756, 48,759 (Aug. 14, 2012). IBG desires review of
`
`the ’304 patent, which it has been accused of infringing in a lawsuit filed by TT
`
`against it in 2010. IBG is filing this petition on its own behest and at its own cost,
`
`using its own counsel. CQG did not control or influence IBG’s decision to file this
`
`petition, nor did CQG participate in the preparation of this petition other than
`
`passively having its earlier-filed petition serve as its basis, nor will it exercise any
`
`control or influence as this proceeding moves forward. CQG has not funded IBG’s
`
`petition and will not fund IBG’s participation in this proceeding at any point in the
`
`future. IBG is represented by separate counsel from CQG, both in the TT litigation
`
`and for the instant petition. CQG had no opportunity to review, provide comments
`
`on, or otherwise influence the instant petition before it was filed by IBG. Nor will it
`
`have any such opportunities moving forward. In brief, there is simply no basis to
`
`conclude that a “non-party exercised or could have exercised control over a party’s
`
`participation” in this CBM.
`
`TT may argue that the fact that IBG is largely resubmitting arguments that
`
`were previously presented by CQG (but never reached by the Board) is a basis for
`
`-6-
`
`

`
`
`
`privity or a finding that CQG is also a real-party-in-interest in this proceeding. That
`
`argument has already been rejected in a precedential decision by the Board. JP
`
`Morgan Chase & Co. et al v. Maxim Integrated Products, Inc., CBM2014-00179,
`
`Paper 11 at 13 (PTAB Feb. 20, 2015).
`
`The JP Morgan Chase case is precisely on point. In that case, a third party
`
`(like CQG) had previously sued the patentee for a declaratory judgment of invalidity.
`
`That case was ultimately consolidated into a multi-district litigation that included the
`
`petitioners. The petitioners and the third party jointly filed a CBM request, prior to
`
`the Board’s clarification that CBM proceedings, like IPR proceedings, are subject to
`
`the DJ action bar. Subsequent to that clarification, the Board dismissed the entire
`
`CBM on the basis of the third party’s prior DJ action. The petitioners then re-filed a
`
`substantially similar petition, relying on the same declarant, but leaving out the third
`
`party that the Board had previously found was barred from seeking a CBM based on
`
`its DJ action. The Board rejected the patent owner’s argument that the overlap in
`
`prior art and arguments, as well as the use of the same declarant, between the re-filed
`
`petition and the dismissed petition evidenced the third party’s control and
`
`contributions to the proceeding sufficient to raise a defect in the identification of the
`
`real-party-in-interest. Consequently, the Board instituted the proceeding over the
`
`patent owner’s objection. The same result applies here.
`
`C.
`
`The ’304 Patent Is Available for Covered Business Method Patent
`Review Under 37 C.F.R. § 42.301
`
`A patent is available for CBM review if the patent claims a “method or
`
`corresponding apparatus for performing data processing or other operations used in
`
`-7-
`
`

`
`
`
`the practice, administration, or management of a financial product or service, except
`
`that the term does not include patents for technological inventions.” 37 C.F.R.
`
`§ 42.301 (a); see also AIA § 18(d)(1) (a covered business method patent is “a patent
`
`that claims a method or corresponding apparatus for performing data processing or
`
`other operations used in the practice, administration, or management of a financial
`
`product or service”). A patent is for a technological invention if “the claimed subject
`
`matter as a whole recites a technological feature that is novel and unobvious over the
`
`prior art; and solves a technical problem using a technical solution.” 37 C.F.R.
`
`§ 42.301(b).
`
`To determine whether a patent is available for CBM review, the focus is on the
`
`claims. Transitional Program for CBM Patents—Definitions, 77 Fed. Reg. 48734,
`
`48736 (Aug. 14, 2012). A patent needs only one claim directed to a covered business
`
`method to be eligible for review. Id. at 48,736.
`
`In promulgating rules for CBM reviews, the PTO considered the legislative
`
`intent and history behind the AIA’s definition of “covered business method patent.”
`
`Id. at 48735–736. The “legislative history explains that the definition of covered
`
`business method patent was drafted to encompass patents claiming activities that are
`
`financial in nature, incidental to a financial activity or complementary to a financial
`
`activity.” Id. (citing 157 Cong. Rec. S5432 (daily ed. Sept. 8, 2011) (statement of
`
`Sen. Schumer)). The legislative history indicates that “financial product or service”
`
`should be interpreted broadly. Id. Therefore, the PTO has broadly defined the term
`
`“covered business method patent” to encompass patents claiming activities that are
`
`financial in nature, incidental to a financial activity or complementary to a financial
`
`-8-
`
`

`
`
`
`activity. See id. at 48735; see also SAP Am., Inc. v. Versata Dev. Grp., Inc.,
`
`CBM2012-00001, Decision to Institute (Paper No. 36), at p. 23 (P.T.A.B. Jan. 9,
`
`2013), aff’d Versata Dev. Group, Inc. v. SAP Am., Inc., slip op. at 35-36 (Fed. Cir.
`
`July 9, 2015).
`
`As discussed in more detail below, the ’304 patent is a covered business
`
`method patent and not directed to a technological invention. Accordingly, CBM
`
`review of the ’304 patent should be instituted.
`
`1.
`
`The USPTO Has Already Determined that the ’304 Patent Is
`a Covered Business Method Patent
`
`TD Ameritrade previously filed a CBM petition against the ’304 patent. The
`
`Board carefully reviewed the ’304 patent and found that it is a covered business
`
`method patent and is eligible for covered business method patent review. TD
`
`Ameritrade Holding Corp. v. Trading Tech. Int’l, Inc., Case CBM2014-00136,
`
`Decision Denying Institution (Paper No. 19), at pp. 7–12 (P.T.A.B. Dec. 2, 2014)
`
`(Ex. 1003). Anticipating that TT will argue that the ’304 patent is not eligible for
`
`covered business method patent review, despite the Board’s ruling to the contrary,
`
`Petitioners will briefly address the eligibility of the ‘304 patent for covered business
`
`method patent review.
`
`a.
`
`Classification
`
`Under the plain language of 37 C.F.R § 42.301(a), the ’304 patent squarely
`
`qualifies as a “covered business method patent.” According to the PTO, patents
`
`subject to covered business method patent review are typically classifiable in Class
`
`705. See, e.g., Transitional Program for CBM Patents—Definitions, supra, 77 Fed.
`
`-9-
`
`

`
`
`
`Reg. at 48739. Class 705 relates to “Data Processing: Financial, Business Practice,
`
`Management, or Cost/Price Determination.” Although not entirely dispositive of its
`
`qualification as a covered business method patent, the claimed systems and methods
`
`of the ’304 patent are classified in Class 705. Specifically, the following classes
`
`were included on the front of the ’304 patent (with class 705/37 being identified as
`
`the primary class):
`
`705/35
`
`705/36
`
`705/37
`
`Finance (e.g., banking, investment or credit)
`
`Portfolio selection, planning or analysis
`
`Trading, matching, or bidding
`
`Tellingly, the PTO’s classification demonstrates that the ’304 patent is financial in
`
`nature and falls under the definition under § 42.301(a).
`
`b.
`
`Claim Language
`
`Taking independent claims 1 and 27 as representative claims, there are several
`
`phrases that indicate the claims are financial in nature. The preamble of claims 1 and
`
`27 call for “displaying market information,” “trading of a commodity,” “electronic
`
`exchange,” “bid price,” and “ask price”—all of which relate to a financial market.
`
`(Ex. 1001, independent claims 1 and 27.) Although TT may argue that the claims can
`
`be applied to other situations, the claims’ clear intention is to cover financial
`
`transactions.
`
`Additional claim limitations further emphasize that the ’304 patent qualifies
`
`for CBM review. The first and second elements of claims 1 and 27 describe the
`
`bid/buy and ask/sell side of a transaction for a commodity in the market. For
`
`example, the first element describes “a bid display region . . . corresponding to a
`
`-10-
`2
`
`

`
`
`
`price level . . . [and a] first indicator representing quantity associated with at least
`
`one order to buy the commodity at the highest bid price currently available in the
`
`market.” The third element discusses the positioning of the bid and ask display
`
`regions along the price axis. The fourth element displays an order entry region for
`
`sending trade orders, again, where “trade” is a term commonly used in the financial
`
`market. Finally, the fifth element discusses “setting a . . . trade order relating to the
`
`commodity and sending the trade order to the electronic exchange.” (Id.)
`
`Examining the elements, the ’304 patent is directed to the sending of trade
`
`orders (i.e., bid and ask transactions) based on displayed market information, as well
`
`as updating the market information. Obviously, displaying market information and
`
`sending trade orders form the basis of any financial market. Clearly, the claims of the
`
`’304 patent are directed to a financial market and directed to subject matter that is
`
`covered by the CBM review process.
`
`2.
`
`The ’304 Patent Is Not for a “Technological Invention”
`
`The definition of a covered business method patent in Section 18(d)(1) of the
`
`AIA does not include patents for “technological inventions.” A technological
`
`invention is determined by considering “whether the claimed subject matter as a
`
`whole recites a technical feature that is novel and unobvious over the prior art; and
`
`solves a technical problem using a technical solution.” 37 C.F.R. § 42.301(b). As
`
`noted previously, the Board found in the TD Ameritrade decision that the ’304 patent
`
`is not a technological invention. (Ex. 1003, pp. 10–12.)
`
`Even though the Board has found to the contrary, TT will likely continue to
`
`argue that its patents are technological. But the ’304 patent is not for a technological
`
`-11-
`
`

`
`
`
`invention because it does not solve a technical problem with a technical solution.
`
`Instead, it recites the ordinary application of old, well-understood data display and
`
`graphical user interface techniques.
`
`The following claim drafting techniques typically do not render a patent a
`
`“technological invention:”
`
`(a) Mere recitation of known technologies, such as computer
`
`hardware, communication or computer networks, software, memory,
`
`computer-readable storage medium, scanners, display devices or
`
`databases, or specialized machines, such as an ATM or point of sale
`
`device.
`(b) Reciting the use of known prior art technology to accomplish
`a process or method, even if that process or method is novel and non-
`
`obvious.
`(c) Combining prior art structures to achieve the normal,
`
`expected, or predictable result of that combination.
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`Office Patent Trial Practice Guide, 77 Fed. Reg. 48756, 48763–764 (Aug. 14, 2012).
`
`3.
`
`The Claimed Subject Matter of the ’304 Patent as a Whole
`Does Not Recite a Technical Feature that Is Novel and
`Unobvious Over the Prior Art
`
`The first prong of the technological invention analysis is whether the claims as
`
`a whole recite a technical feature that is novel and unobvious over the prior art. As
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`described in detail herein, the claims of the ’304 patent do not recite any such novel
`
`or nonobvious technical feature. Rather, they recite only well-understood, routine,
`
`and conventional steps of displaying market information graphically to a trader, who
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`enters buy and sell orders, and sending the trader’s orders to an exchange to be
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`executed.
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`
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`Sending trade orders is well-known, as are computer user interfaces that
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`facilitate this process. Patent Owner admits in the background section of the ’304
`
`patent that: “At least 60 exchanges throughout the world utilize electronic trading in
`
`varying degrees to trade stocks, bonds, futures, options and other products.” (Ex.
`
`1001, 1:27–29.) The use of a graphical user interface to facilitate the process of
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`sending trade orders is not novel or non-obvious. Indeed, the ’304 patent itself admits
`
`as much in its characterization of known prior art systems:
`
`[T]he exchange participants’ computers allow traders to participate in
`
`the market. They use software that creates specialized interactive
`
`trading screens on the traders’ desktops. The trading screens enable
`
`traders to enter and execute orders, obtain market quotes, and monitor
`
`positions. (Ex. 1001, 1:62-66.)
`
`In addition, there were a significant number of additional patents cited during
`
`prosecution of the ’304 patent that disclose a graphical user interface in the context of
`
`an electronic exchange. (File History of the ’304 patent, Ex. 1002.) In fact, FIG. 2 of
`
`the ’304 patent, which shows the state of the prior art, demonstrates that the use of a
`
`graphical interface to display market information and send trade orders (i.e., bid or
`
`ask transactions) for a commodity on an electronic exchange was well-known at the
`
`time the patent was filed. (Ex. 1001, 5:13–19.)
`
`Further, the ’304 patent does not disclose, nor are the claims directed to, any
`
`new computer hardware. Rather, the claims have been crafted to recite software and
`
`only general-purpose computer components, such as a “dynamic display,” a “display
`
`device” and an “input device.” (Id., independent claims 1 and 27.) These components
`
`are not technologically novel or non-obvious. They are generic and known
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`-13-
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`

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`
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`technology. Even the specification of the patent acknowledges that the alleged
`
`invention requires only a generic “computer or [an] electronic terminal . . . able to
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`communicate directly or indirectly . . . with the exchange.” (Id., 4:2–4.) Congress did
`
`not intend a patent with such basic, well-known technology disclosures to be
`
`inoculated from CBM review:
`
`[The technological inventions exception] is not meant to exclude patents
`
`that use known technology to accomplish a business process or method
`
`of conducting business—whether or not that process or method appears
`
`to be novel. The technological invention exception is also not intended
`
`to exclude a patent simply because it recites technology. For example,
`
`the recitation of computer hardware, communication or computer
`
`networks, software, memory, computer-readable storage medium,
`
`scanners, display devices or databases, specialized machines, such as an
`
`ATM or point of sale device, or other known technologies, does not
`
`make a patent a technological invention. In other words, a patent is not a
`
`technological invention because it combines known technology in a new
`
`way to perform data processing operations.
`
`157 Cong. Rec. S1364 (daily ed. Mar. 8, 2011) (Sen. Schumer).
`
`TT likely also will argue that the ’304 patent addresses one or more technical
`
`problems such as creating a display to efficiently match buyers and sellers and
`
`facilitate the sending of trade orders. But the basic idea of facilitating trades between
`
`buyers and sellers has been around since Western Frontier-era trading posts if not
`
`much longer. In short, the TT solution uses known technology to reach an entirely
`
`predictable end.
`
`-14-
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`

`
`
`
`4.
`
`The Claimed Subject Matter of the ’304 Patent as a Whole
`Does Not Solve a Technical Problem Using a Technical
`Solution
`
`The analysis could stop here, as the “technological invention” exception does
`
`not apply when even one prong of 37 C.F.R. § 42.301(b) is not met. Regardless, the
`
`’304 patent also fails to satisfy the second prong of 37 C.F.R. § 42.301(b) because
`
`the claims do not solve a technical problem using a technical solution. There is no
`
`technical problem being addressed. The problem is directed to placing a trade order
`
`for a commodity on an electronic exchange. Even the ’304 patent admits that at the
`
`time of filing at least 60 exchanges throughout the world utilized electronic trading
`
`systems to trade stocks, bonds, futures and options, and allowed traders to
`
`participate in the market. (Ex. 1001, 1:27–29, 1:55–57.) Placing an order on the
`
`exchange is a financial issue – not a novel technical problem.
`
`a.
`
`Plain Language
`
`TT will argue the legislative history favors exempting the ’304 patent. In
`
`interpreting any statute, the first place to start is the language of the statute itself.
`
`[C]anons of construction are no more than rules of thumb that help
`
`courts determine the meaning of legislation, and in interpreting a statute
`
`a court should always turn first to one, cardinal canon before all
`
`others. . . . [C]ourts must presume that a legislature says in a statute
`
`what it means and means in a statute what it says there. When the words
`
`of a statute are unambiguous, then, this first canon is also the last:
`
`judicial inquiry is complete.
`
`Connecticut Nat’l Bank v. Germain, 503 U.S. 249, 253–54 (1992) (citations omitted).
`
`Here, the unambiguous language of the statute covers the ’304 patent. First,
`
`the patent covers a method of displaying and manipulating or adjusting prices for
`
`-15-
`8
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`

`
`
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`financial products. Second, the patent also covers the financial service of placing
`
`orders for financial instruments.
`
`b.
`
`Legislative History
`
`Petitioners see little merit in looking beyond the unambiguous words of the
`
`statute and the words of the claims. But in anticipation of TT’s arguments to the
`
`contrary, Petitioners will discuss the relevant legislative history. In examining the
`
`legislative history related to the statute for CBM Review, the PTO explained that that
`
`“financial product or service” should be “interpreted broadly,” encompassing patents
`
`“claiming activities that are financial in nature, incidental to a financial activity or
`
`complementary to a financial activity.” Transitional Program for CBM Patents—
`
`Definitions, 77 Fed. Reg. at 48735.
`
`The ’304 patent meets this definition. It expressly claims displaying market
`
`information relating to and facilitating trading including displaying bids and asks in
`
`the market, selecting an area on a display to set parameters for a trade order, and
`
`sending the trade order to the electronic exchange. (See Ex. 1001, independent claims
`
`1 and 27.) Likewise, the patent describes a graphical user interface for trading such as
`
`that shown in FIGS. 3–5 of the ’304 patent.
`
`TT will likely point to statements from Senator Durbin regarding the scope of
`
`the statute. Senator Durbin, like some other Senators, sought to add comments to
`
`influence the interpretation of the statute. At a high level, three areas were discussed
`
`in the legislative history before the bill passed as deserving special treatment: 1. Tax
`
`Strategies; 2. Bill Counters; and 3. User Interfaces for Commodities. Bot