`
`Document: 139
`
`Page:1
`
`Filed: 02/13/2019
`
`NOTE: This disposition is nonprecedential.
`
`Anited States Court of Appeals
`for the federal Circuit
`
`IBG LLC, INTERACTIVE BROKERS, LLC,
`Appellants
`
`Vv.
`
`TRADING TECHNOLOGIES INTERNATIONAL,
`INC.,
`Cross-Appellant
`
`UNITED STATES,
`Intervenor
`
`2017-1732, 2017-1766, 2017-1769
`
`Appeals from the United States Patent and Trademark
`Office, Patent Trial and Appeal Board in Nos. CBM2015-
`00161, CBM2016-00035.
`
`IBG LLC, INTERACTIVE BROKERS LLC,
`Appellants
`
`Vv.
`
`TRADING TECHNOLOGIES INTERNATIONAL,
`INC.,
`Cross-Appellant
`
`
`
`Case: 17-1732
`
`Document: 139
`
`Page:2
`
`Filed: 02/13/2019
`
`2
`
`IBG LLC v. TRADING TECHNOLOGIESINT'L
`
`UNITED STATES,
`Intervenor
`
`2017-2052, 2017-2053
`
`Appeals from the United States Patent and Trademark
`Office, Patent Trial and Appeal Board in No. CBM2015-
`00182.
`
`TRADING TECHNOLOGIES INTERNATIONAL,
`INC.,
`Appellant
`
`Vv.
`
`IBG LLC, INTERACTIVE BROKERSLLC,
`Appellees
`
`UNITED STATES,
`Intervenor
`
`2017-2054
`
`Appeal from the United States Patent and Trademark
`Office, Patent Trial and Appeal Board in No. CBM2015-
`00181.
`
`TRADING TECHNOLOGIES INTERNATIONAL,
`INC.,
`
`
`
`
`
`Case: 17-1732 Page:3_Filed: 02/13/2019Document:139
`
`
`
`IBG LLC v. TRADING TECHNOLOGIES INT'L
`
`3
`
`Appellant
`
`Vv.
`
`IBG LLC, INTERACTIVE BROKERSLLC,
`Appellees
`
`UNITED STATES,
`Intervenor
`
`2017-2565
`
`Appeal from the United States Patent and Trademark
`Office, Patent Trial and Appeal Board in No. CBM2016-
`00031.
`
`Decided: February 13, 2019
`
`BYRON LEROY PICKARD, Sterne Kessler Goldstein &
`Fox, PLLC, Washington, DC, argued for appellants in
`2017-1732, 2017-2052 and for appellees in 2017-2054,
`2017-2565. Also represented by RICHARD M. BEMBEN,
`ROBERT EVAN SOKOHL, JON WRIGHT; MICHAEL T. ROSATO,
`Wilson, Sonsini, Goodrich & Rosati, PC, Seattle, WA.
`
`MICHAEL DAVID GANNON,Baker & Hostetler LLP, Chi-
`cago, IL, argued for cross-appellant in 2017-1732, 2017-
`2052 and appellant in 2017-2054, 2017-2565. Also repre-
`sented by LEIF R. SIGMOND, JR., JENNIFER KURCZ; ALAINA
`J. LAKAWICZ, Philadelphia, PA; COLE BRADLEY RICHTER,
`McDonnell, Boehnen, Hulbert & Berghoff, LLP, Chicago,
`IL; STEVEN BORSAND, JAY QUENTIN KNOBLOCH, Trading
`Technologies International, Inc., Chicago, IL.
`
`
`
`
`
`Case: 17-1732 Page:4_Filed: 02/13/2019Document: 139
`
`
`
`4
`
`IBG LLC v. TRADING TECHNOLOGIESINT'L
`
`KATHERINE TWOMEY ALLEN, Appellate Staff, Civil Divi-
`sion, United States Department of Justice, Washington,
`DC, argued for intervenor. Also represented by MARK R.
`FREEMAN, SCOTT R. McINTOSH, JOSEPH H. HUNT; THOMAS
`W. KRAUSE, JOSEPH MATAL, FARHEENA YASMEEN RASHEED,
`Office of the Solicitor, United States Patent and Trade-
`mark Office, Alexandria, VA.
`
`Before LOURIE, MOORE, and REYNA, Circuit Judges.
`PER CURIAM.
`.
`
`Trading Technologies International, Inc., (“TT”) is the
`ownerof U.S. Patent Nos. 6,766,304, 6,772,132, 7,676,411,
`and 7,813,996. All four patents share a specification and
`describe a graphical user interface (“GUI”) for a trading
`system that “display[s] the market depth of a commodity
`traded in a market, including a dynamic display for a plu-
`rality of bids and for a plurality of asks in the market for
`the commodity and a static display of prices corresponding
`to the plurality of bids and asks.” °132 patent at 3:11-16.!
`IBG LLC andInteractive Brokers LLC (collectively, “Peti-
`tioners”) petitioned for covered business method (“CBM”)
`review of each patent.?
`The Board instituted CBM review of each patent and
`issued separate final written decisions. In the proceedings
`involving the ’304 and ’132patents, the Board upheld the
`patenteligibility of the claims based on our reasoning in
`Trading Technologies International, Inc. v. CQG, Inc., 675
`
`1 Because all four patents share a specification, we
`cite only to the 7132 patent throughout.
`patent;
`’304
`2
`CBM2015-00161
`involved
`the
`CBM2015-00182 involved the °132 patent; CBM2015-
`00181 involved the ’411 patent; and CBM2016-00031 in-
`volved the ’996 patent.
`
`
`
`
`
`Case: 17-1732 Page:5_Filed: 02/13/2019Document: 139
`
`
`
`IBG LLC v. TRADING TECHNOLOGIESINT'L
`
`5
`
`F. App’x 1001 (Fed. Cir. 2017). In the proceedings involv-
`ing the ’411 and ’996 patents, the Board held that the
`claims were ineligible.
`In the proceedings involving the
`132 and ’411 patents, the Board also held that all claims
`except claims 29, 39, and 49 of the 132 patent would have
`been obvious.
`
`TT appeals, among otherissues, the Board’s determi-
`_ nations regarding whether the patents are directed to a
`technological invention. Petitioners appeal the Board’s de-
`terminations that the claims of the ’304 and ’132 patents
`are patent eligible and that claims 29, 39, and 49 of the 132
`patent would not have been obvious. Wehave jurisdiction
`under 28 U.S.C. § 1295(a)(4)(A). We vacate the decision of
`the Board in each case because the patents at issue are for
`technological inventions and thus were not properly sub-
`ject to CBM review.
`
`DISCUSSION
`
`The proceedings on appeal stem from the Transitional
`Program for Covered Business Method Patents (“CBM re-
`view”), which expires next year. Leahy-Smith Am. Invents
`Act, Pub. L. 112-29, § 18(a) (“AIA”). Pursuant to the stat-
`ute, the Board may only institute CBM review for a patent
`that is a CBM patent. Id. § 18(a)(1)). A CBM patent is
`“a patent that claims a method or corresponding apparatus
`for performing data processing or other operations used in
`the practice, administration, or managementofa financial
`productor service, except that the term does not include pa-
`tents for technological inventions.” Id. § 18(d)(1) (emphasis
`added). Neither party disputes here that, the patents at
`issue meet the first part of the test. The only issue is
`whetherthe patents are for technological inventions. Pur-
`suant to its authority under § 18(d)(2), the Patent and
`Trademark Office
`(“PTO”)
`promulgated
`37C.F.R.
`§ 42.301(b), which requires the Board to consider the fol-
`lowing on a case-by-case basis in determining whether a
`
`
`
`
`
`Case: 17-1732 Page:6_Filed: 02/13/2019Document: 139
`
`
`
`6
`
`IBG LLC v. TRADING TECHNOLOGIESINT'L
`
`invention: “whether the
`is for a technological
`patent
`claimed subject matter as a whole recites a technological
`feature that is novel and unobviousoverthe prior art” and
`whetherit “solves a technical problem using a technicalso-
`lution.” We review the Board’s reasoning “underthe arbi-
`trary
`and
`capricious
`standard
`and
`its
`factual
`determinations under the substantial evidence standard.”
`SightSound Techs., LLC v. Apple Inc., 809 F.3d 1307, 1315
`(Fed. Cir. 2015).
`
`Wepreviously upheld the eligibility under § 101 of the
`132 and ’304 patents in CQG. 675 F. App’x at 1006. In the
`CBM review proceedings with regard to those patents, the
`Board adopted as persuasive that reasoning and conclu-
`sion. The discussion of those patents in the contextof eli-
`gibility is
`instructive to the technological
`invention
`question. In CQG, the district court held that the claims
`were not directed to an abstract idea, stating:
`
`the claims are directed to solving a problem that
`existed with prior art GUIs, namely, that the best
`bid and best ask prices would change based on up-
`dates received from the market. There was a risk
`with the prior art GUIs that a trader would miss
`her intended price as a result of prices changing
`from under her pointer at the time she clicked on
`the price cell on the GUI. The patents-in-suit pro-
`vide a system and method whereby traders may
`place orders at a particular, identified price level,
`not necessarily the highest bid or the lowest ask
`price because the invention keepsthe prices static
`in position, and allows the quantities at each price
`to change.
`
`Trading Techs. Intl, Inc. v. CQG, 2015 WL 774655, at *4
`(N.D. Ill. 2015). The district court determined that “[t]his
`issue did not arise in the open oltcry systems, i.e. the pre-
`electronic trading analog of the 7304 and 7132 patents’
`
`
`
`Case: 17-1732
`
`Document: 139
`
`Page:7
`
`Filed: 02/13/2019
`
`IBG LLC v. TRADING TECHNOLOGIESINT'L
`
`7
`
`claims.” Id. We agreed “for all of the reasons articulated
`by the district court.” CQG, 675 F. App’x at 1004. We con-
`cluded that “the claimed subject matter is directed to a spe-
`cific improvement to the way computers operate, for the
`claimed [GUI] method imparts a specific functionality to a
`trading system directed to a specific implementation of a
`solution to a problem in the software arts.” Id. at 1006 Gn-
`ternal citations and quotation marks omitted).
`
`This characterization is consistent with the description
`of the invention in the specification. The specification
`states that markets with a high volume oftrading result in
`“rapid changes in the price and quantity fields within the
`market grid” on a trading screen, which can cause a trader
`to miss his intended price.
`°132 patent at 2:51-60. The
`technical problem with prior GUIs in which the inside mar-
`ket remains stationary, like the one in Figure 2 of the 7132
`patent, is most clearly laid out in U.S. Patent App. Ser. No.
`09/589,751, which is incorporated by reference in the ’132
`patent and issued as U.S. Patent No. 6,938,011:
`
`[A] trader might intend to click on a particular
`price but, between the time he decides to do so and
`the time he actually clicks (which maybe only hun-
`dredths of a second), the price may change. He may
`not be able to stop the downward motionofhis fin-
`ger and the order would be sent to market at an
`incorrect or undesired price.
`
`011 patent at 9:35-41. The claimed invention in the pa-
`tents at issue solves this problem “by displaying market
`depth on a vertical or horizontal plane, which fluctuates
`logically up or down, left or right across the plane as the
`marketfluctuates.” ’°132 patent at 6:65—7:2.
`
`In the CBM proceedings involving the 132 and ’304 pa-
`tents, the Board agreed with CQG and foundthe claims of
`both patents eligible. At the same time, the Board held
`that the patents are not for technological inventions.
`If
`
`
`
`Case: 17-1732
`
`Document:139
`
`Page:8
`
`Filed: 02/13/2019
`
`8
`
`IBG LLC v. TRADING TECHNOLOGIES INT'L
`
`“the claimed subject matter is directed to a specific im-
`provement to the way computers operate,” as we held in
`CQG, 675 F. App’x at 1006, the patents are also for a “tech-
`nological invention” under any reasonable meaningof that
`term. We conclude that the Board’s reasoning with regard
`to the ’132 and ’304 patents is internally inconsistent and
`therefore arbitrary and capricious. And because wesee no
`meaningful difference between the claimed subject matter
`of the 7132 and ’304 patents and that of the ’411 and ’996
`patents for the purposes of the technological invention
`question, the same conclusion applies in those cases as
`well.
`
`CONCLUSION
`
`Based on our decision in CQG and the Board’s adoption
`thereof, the Board’s reasoning in determining that the 132,
`304, 411, and ’996 patents are eligible for CBM review was
`arbitrary and capricious. We hold that these patents are
`“for technological inventions” under AIA, § 18(d)(1) and are
`‘ therefore not subject to CBM review. Because the Board
`may only institute CBM review for CBM patents, we va-
`cate.
`
`VACATED
`
`Costs
`
`Nocosts.
`
`
`
`
`
`Case: 17-1732 Page:1_Filed: 02/13/2019Document: 140
`
`
`
`Anited States Court of Appeals
`for the federal Circuit
`
`IBG LLC, INTERACTIVE BROKERS, LLC,
`Appellants
`
`TRADING TECHNOLOGIES INTERNATIONAL,
`INC.,
`Cross-Appellant
`
`UNITED STATES,
`Intervenor
`
`2017-1732, 2017-1766, 2017-1769,
`
`Appeals from the United States Patent and Trademark
`Office, Patent Trial and Appeal Board in No. CBM2015-
`00161, CBM2016-00035
`
`IBG LLC, INTERACTIVE BROKERSLLC,
`Appellants
`
`Vv.
`
`TRADING TECHNOLOGIES INTERNATIONAL,
`INC.,
`Cross-Appellant
`
`
`
`Case: 17-1732
`
`Document:140
`
`Page:2
`
`Filed: 02/13/2019
`
`UNITED STATES,
`Intervenor
`
`2017-2052, 2017-2053
`
`from the United States Patent and
`Appeals
`Trademark Office, Patent Trial and Appeal Board in No.
`CBM2015- 00182.
`
`TRADING TECHNOLOGIES INTERNATIONAL,
`INC.,
`Appellant
`
`Vv.
`
`IBG LLC, INTERACTIVE BROKERSLLC,
`Appellees
`
`UNITED STATES,
`Intervenor
`
`2017-2054.
`
`from the United States Patent and
`Appeal
`Trademark Office, Patent Trial and Appeal Board in No.
`CBM2015- 00181.
`
`TRADING TECHNOLOGIES INTERNATIONAL,
`.
`INC.,
`
`
`
`
`
`Case: 17-1732 Page:3_Filed: 02/13/2019Document: 140
`
`
`
`Appellant
`
`Vv.
`
`IBG LLC, INTERACTIVE BROKERSLLC,
`Appellees
`
`UNITED STATES,
`Intervenor
`
`2017-2565
`
`and
`from the United States Patent
`Appeal
`Trademark Office, Patent Trial and Appeal Board in No.
`CBM2016- 00031.
`
`JUDGMENT
`
`THIS CAUSE having been considered,it is
`
`ORDERED AND ADJUDGED:
`
`VACATED
`
`ENTERED By ORDER OF THE COURT
`
`February 13, 2019
`
`/s/ Peter R. Marksteiner
`Peter R. Marksteiner
`Clerk of Court
`
`
`
`Case: 17-1732
`
`Document: 149
`
`Page:1
`
`Filed: 05/07/2019
`
`Anited States Court of Appeals
`for the federal Circuit
`
`IBG LLC, INTERACTIVE BROKERS, LLC,
`Appellants
`
`Vv.
`
`TRADING TECHNOLOGIES INTERNATIONAL,
`INC.,
`Cross-Appellant
`
`UNITED STATES,
`Intervenor
`
`2017-1732, 2017-1766, 2017-1769
`
`Appeals from the United States Patent and Trademark
`Office, Patent Trial and Appeal Board in Nos. CBM2015-
`00161, CBM2016-00035.
`
`/
`
`MANDATE
`
`In accordance with the judgmentof this Court, entered
`February 13, 2019, and pursuant to Rule 41 of the Federal
`Rules of Appellate Procedure,
`the formal mandate is
`hereby issued.
`
`FOR THE COURT
`
`May7, 2019
`
`,
`
`/si Peter R. Marksteiner
`Peter R. Marksteiner
`Clerk of Court
`
`