UNITED STATES PATENT AND TRADEMARK OFFICE
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`TRADESTATION GROUP, INC.;
`TRADESTATION SECURITIES, INC.;
`IBG LLC; AND
`INTERACTIVE BROKERS LLC;
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`Petitioners
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`v.
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`TRADING TECHNOLOGIES INTERNATIONAL, INC.
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`Patent Owner
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`
`
`Case CBM2016-00051
`U.S. Patent No. 7,904,374 B2
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`DECLARATION OF CHRISTOPHER H. THOMAS
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`Page 1 of 86
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`TRADING TECH EXHIBIT 2169
`TRADESTATION ET AL. v. TRADING TECH
`CBM2016-00051
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`TRADESTATION GROUP, INC.;
`TRADESTATION SECURITIES, INC.;
`IBG LLC; AND
`INTERACTIVE BROKERS LLC;
`
`Petitioners
`
`v.
`
`TRADING TECHNOLOGIES INTERNATIONAL, INC.
`
`Patent Owner
`
`
`
`
`Case CBM2016-00051
`U.S. Patent No. 7,904,374 B2
`
`
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`DECLARATION OF CHRISTOPHER H. THOMAS
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`TRADING TECH EXHIBIT 2169
`TRADESTATION ET AL. v. TRADING TECH
`CBM2016-00051
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`TABLE OF CONTENTS
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`INTRODUCTION ........................................................................................... 3
`I.
`QUALIFICATIONS & BACKGROUND ...................................................... 5
`II.
`INFORMATION CONSIDERED ................................................................. 11
`III.
`IV. PERSON OF ORDINARY SKILL IN THE ART ........................................ 13
`V.
`BACKGROUND OF THE INDUSTRY ....................................................... 16
`VI. CONVENTIONAL GRAPHICAL USER INTERFACE
`TOOLS (“GUI TOOLS”) .............................................................................. 29
`VII. THE UTILITY AND ADVANTAGES OF THE PATENTED
`INVENTION ................................................................................................. 42
`VIII. THE CLAIMED INVENTION IS TECHNICAL ......................................... 73
`IX. CONCLUDING STATEMENTS .................................................................. 86
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`I.
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`INTRODUCTION
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`I, Christopher H. Thomas, declare as follows:
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`1.
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`I am over 18 years of age. I have personal knowledge of the facts
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`stated in this declaration and could testify competently to them if asked to do so.
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`2.
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`I have been retained on behalf of Patent Owner Trading Technologies
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`International, Inc. (“Patent Owner”) to provide expert opinions in connection with
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`Case CBM2016-00051, regarding United States Patent No. 7,904,374 (“the ’374
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`patent”).
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`3.
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`I understand that a Petition was filed on March 29, 2016 seeking
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`covered business method (“CBM”) review of claims 1 through 36 of the ’374
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`patent, and the petition was subsequently assigned case no. CBM2016-00051. I
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`understand that in the Petition, Petitioner alleged that the claims are unpatentable
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`under 35 U.S.C. § 101. I understand that the Petitioner did not allege any grounds
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`of anticipation. The PTO instituted CBM review, by decision dated August 17,
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`2016, for all claims of the ’374 patent under § 101.
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`4.
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`I have been asked to address the technological nature of the claims, as
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`well as the inquiry into whether the invention solves a technical problem using a
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`technical solution. I have also been asked to address whether the claim elements
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`are routine and conventional.
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`5.
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`I am being compensated for my time spent on this matter, including
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`independent study, document review, analysis, and writing. My opinions stated
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`herein are based on review and analysis of the materials obtained in connection
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`with my work in his matter, together with my education and experience. The
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`opinions stated herein are my own. My compensation is not contingent upon my
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`opinions stated herein or the outcome of this proceeding.
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`6.
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`It is my opinion that the invention of claims 1 through 36 of the ’374
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`patent provide a specific structure, makeup, and functionality of a new GUI tool.
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`The claims solve a technical problem with a technical solution that is specifically
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`implemented. The claims are narrowly drawn to not preempt any and all generic
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`displaying and updating of market information with placement of trade orders in
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`other systems.
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`7.
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`It is also my opinion that the claims are not directed to routine or
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`conventional elements, but to the features of a specialized GUI tool. Further, as
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`evidenced by the overwhelming real world evidence, the claimed combination was
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`not routine or conventional, but a radical departure from the construction of GUI
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`tools in the prior art. The elements of the ‘374 claims are not combined in a
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`generic manner, but purposefully arranged to construct the specifically claimed
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`technological solution. When considering the claim limitations individually and as
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`a whole, they recite an invention that is not merely the routine and conventional
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`use of technology. Instead, as described below, the claimed invention went
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`directly against the conventional wisdom at the time of the invention.
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`II. QUALIFICATIONS & BACKGROUND
`8. My curriculum vitae is attached to this report as Exhibit A. Briefly,
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`my expertise lies in the field of the engineering, design, and development and
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`construction of graphical user interface (“GUI”) tools for electronic trading, such
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`as those used in electronic trade execution systems and proprietary trading
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`systems.
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`9.
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`I have been actively trading on exchanges worldwide and managing
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`portfolios of futures, commodities, stocks, and stock indexes since 1992. In 1996,
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`I began developing trading decision and execution systems. At that time, my
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`trading became completely reliant on the systems that I had developed.
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`Ultimately, this led to my career in technology as a Chief Technology Officer
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`(CTO) for several large trading companies and Managing Director of a large
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`Canadian bank.
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`10. As CTO of Emerald Market Systems in 1997, I designed and
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`developed an internet quote system that was used by the Chicago Mercantile
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`Exchange to provide free quotes for certain new markets that the exchange was
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`promoting over the internet. The system had two versions. The first version was a
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`HTML based quote application that provided typical last price, best bid and ask
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`price information. The second version was a JAVA based version of the HTML
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`quote application. Both of these versions were used to facilitate trading in the open
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`outcry trading pits. In 1998, I designed and developed for a Chicago-based Futures
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`Commission Merchant, named LFG, the first web browser based trade order entry
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`system for the U.S. commodity markets known as “FuturesOnline.” When
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`FuturesOnline was first released to users, there were no electronic exchanges for
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`futures that were available to regular users who were not members of an exchange
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`in the United States. Because of this, FuturesOnline was initially connected to the
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`TOPS system at the Chicago Mercantile Exchange. This allowed traders
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`connected via the internet to send orders using FuturesOnline, which would be
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`routed to the relevant trading pit at the exchange using the TOPS system.
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`FuturesOnline also provided quotes to its traders and also allowed them to view
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`their previous transactions, open orders, account balances, etc. Later, when
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`GLOBEX became available to regular customers of FCMs, FuturesOnline was
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`connected to GLOBEX as an electronic exchange destination. I was responsible
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`for designing and programming all of the graphical user interfaces (“GUIs”) and
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`designing and implementing the database that FuturesOnline used for storing
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`trades, orders, account balances, etc. There was another component to
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`FuturesOnline which I developed and that was the broker version. This enabled
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`brokers at LFG to see all of the account balances and open and closed orders for all
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`of their clients, and it enabled the brokers to enter orders, modify existing orders,
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`cancel orders or close out trades for any of their customer’s accounts. This was
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`functionality that they had never had before and it greatly increased the
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`productivity of the brokers and allowed them to have improved risk management
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`over their customers’ trading activities. FuturesOnline was so successful that I
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`created a white-labeled version that enabled other FCMs to use the FuturesOnline
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`technology while it appeared to their customers that it was their own.
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`FuturesOnline was white labeled to three FCMs, in addition to LFG’s use. In
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`developing LFG’s FuturesOnline, I utilized Distributed Network Architecture
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`(“DNA”) technology from Microsoft Corp. FuturesOnline was later featured on
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`Microsoft’s website as a case study for its use of DNA technology. A copy of the
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`case study is attached as Ex. D, (Microsoft DNA Case Study). This technology
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`was developed for electronic trading, not for mimicking or supporting open outcry
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`trading. As will be discussed below, in the transition away from open outcry
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`trading, some technology was developed to mimic open outcry trading, while other
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`technology was developed to carry out electronic trading by sending trade orders to
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`an electronic exchange for automatic anonymous matching. FuturesOnline falls
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`into the latter category.
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`11. During the period from about 1992 to 2002, I was active in the trading
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`community in a variety of roles relating to trading and/or technology for trading, as
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`described in this declaration. By virtue of this experience, I witnessed, participated
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`in, and am familiar with the industry’s transformation from open outcry trading
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`pits, to early trading tools for after-hours trading (such as the Chicago Board of
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`Trade’s Project A and the CME/Reuters GLOBEX system) and, eventually, to
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`what we refer to today as electronic trading and its technology based trading tools.
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`12. From late 1999 until 2002, I was the CTO for Stafford Trading, a
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`proprietary trading company in Chicago, Illinois, USA, which was one of the
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`largest market makers on the U.S. equity option exchanges. In this capacity, I
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`managed a staff of roughly one hundred individuals and an annual technology
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`budget in excess of fifteen million dollars. This staff included approximately 40
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`software developers, 40 network and server engineers, and 20 support staff.
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`During this time, I also designed a new desktop order entry system to replace a
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`legacy system for the traders at Stafford Trading. This system was connected to
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`electronic exchanges and ECNs for stocks and options on stocks, and was
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`connected to the CME GLOBEX electronic exchange for futures. I designed the
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`GUIs for that system, which included Level II type quotes (this is functionally
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`equivalent to Figure 2 in the TT patents). In April of 2000, while at Stafford
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`Trading I became a founder and CTO of a technology company called Ragnarok
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`Systems Inc., which was majority owned by the principals of Stafford Trading.
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`Ragnarok Systems was a next generation online trading brokerage firm. Ragnarok
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`Systems along with parts of Stafford Trading was acquired by Toronto Dominion
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`Bank in March of 2002. Ragnarok Systems was also featured on Microsoft’s
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`website as an example of large commercial usage of Microsoft’s technologies in
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`the Financial Services industry. At Toronto Dominion Bank (“the Bank”), a large
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`Canadian bank, after the acquisition, I served until August 2003 as a Managing
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`Director and CTO of the new entity at the Bank that was named TD Options, LLC.
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`I subsequently returned to trading as a Managing Director at TD Options LLC and
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`continued to further develop trading systems that I had begun using several years
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`earlier. In 2006, I started my own trading group at TD Options LLC, while still
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`serving as a Managing Director, and actively traded a long-short portfolio of U.S.
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`Equities and U.S. equity index futures, using the trading strategies and software
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`tools that I developed. This trading was electronic trading. When I refer to
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`electronic trading, I am referring generally to a system in which traders send
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`electronic orders to an electronic exchange, where the electronic exchange uses
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`technology to implement an automatic matching engine (via hardware and
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`software).
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`13.
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`I left TD Options LLC in October of 2008 and became a founder of a
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`proprietary trading firm in Chicago, named Pembroke Trading LLC, specializing
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`in algorithmic trading of futures markets. In this capacity, I was responsible for
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`designing and managing the development of the user interfaces and electronic
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`trading platforms and infrastructure for testing and executing trading strategies in
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`live markets.
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`14.
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`In May of 2011, I started my own proprietary trading firm,
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`Maridunum Capital, L.L.C., which specializes in automated algorithmic trading of
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`Futures Markets. In this capacity, I was responsible for designing all trading
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`software and algorithms for the company. Additionally, I was responsible for
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`programming portions of the software.
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`15.
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`In May of 2016, I became a founder of a software company named
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`Primal Quant LLC, which will provide trading strategy design and testing tools to
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`online traders without the need for the trader to have programming experience or
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`knowledge. At Primal Quant I am responsible for all GUI and database designs, as
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`well as managing a team of software engineers.
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`16.
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`I am not a professional expert witness. My profession is the
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`development of technology for trading and trading. My experience as an expert is
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`limited to the subject matter of the TT patents, and I was hired more than 9 years
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`ago in that role because of my relevant experience in the trading industry,
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`including open outcry, electronic trading, and the development of technology for
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`use in electronic trading. Prior to that, I had never testified as an expert witness in
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`any matter. In sum, before getting involved as an expert, I had widespread
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`exposure and personal knowledge as to the state of the art at time of invention, as
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`well as before and after the time of the invention. Through my experience with the
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`litigation, I was exposed to additional items of information. Coupled with my
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`personal experience in the industry, I have therefore gained extensive knowledge
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`of the art.
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`III.
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`INFORMATION CONSIDERED
`17.
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`I am familiar with the ‘374 patent, the Petition and supporting exhibits
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`and declaration, the patent owner’s preliminary response, and the Board’s
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`institution decision.
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`18. As a result of my involvement in prior court proceedings for related
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`TT patents, I have been exposed to the large amount of alleged prior art that has
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`been presented by the parties in the related litigations over the past ten years.
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`Many, many documents relating to alleged prior art were produced by the
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`defendants, members of the Joint Defense Group, and other third parties. In
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`connection with the court proceedings, there were many dozens of depositions
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`seeking information on the state of the art and the invention, including a number of
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`depositions of third party individuals who executed declarations regarding the
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`uniqueness and benefits to the user and the industry of the commercial
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`embodiment of the claimed invention. In addition, there were party contentions
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`and expert reports relating to the validity of the patents. There were summary
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`judgment filings relating to validity and declarations in support of such filings.
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`Prior to trial, the parties served expert reports and contentions. In the eSpeed case
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`and the CQG case, I testified at trial, as did a number of other experts for the
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`parties. Voluminous material relating to the validity of the patents was developed.
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`Because of my own experience in the industry, my review of the file history, and
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`my experience in these court proceedings, I have a thorough understanding of the
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`state of the art at the time of the invention, and before and after the time of the
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`invention.
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`19.
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`In addition, I have personal experience with a wide variety of
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`technologies for electronic trading (as referenced above in background) and, over
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`the course of my professional involvement in trading, have seen numerous GUI
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`tools for electronic trading. Throughout my professional trading career, I have
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`made an effort to stay current and when possible ahead of the curve, on
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`technologies for trading, including investigating new technology offerings,
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`attending trade shows, and receiving sales pitches from trading technology
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`vendors, as well as developing technology myself. I also have colleagues in the
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`industry, some of whom would be considered one of ordinary skill in the art, and
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`some of whom I would consider to be of significantly higher levels of skill.
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`20. Because of my roles in the industry, from a time significantly before
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`the invention until well thereafter, I was working and speaking on a regular basis
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`with these colleagues and the traders themselves about technology for trading in
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`general, and GUI tools in particular, and their needs, desires, frustrations and
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`challenges with the technology available at the time. These experiences further
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`inform my opinions from the perspective of one of ordinary skill in the art.
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`21.
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`In addition to the above, I have personally traded on electronic
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`exchanges using Trading Technologies’ (“TT’s”) products, including MD Trader,
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`which is the commercial embodiment of the inventions described for example in
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`the ’374 patent. MD Trader has always been the commercial embodiment of the
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`claimed inventions described in the ‘374 patent since MD Trader was launched in
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`2000 through to the present. In addition, I have spoken with numerous users of
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`MD Trader and other experts in the field about MD Trader and how it functions.
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`IV. PERSON OF ORDINARY SKILL IN THE ART
`22. The technology at issue in this proceeding is a graphical user interface
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`(“GUI”) tool for trading. In general, the term GUI refers to a human-machine
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`interface that allows users to interact with the machine by utilizing graphical
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`elements, as opposed to, for example, text-based interfaces. Text-based interfaces
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`typically required the user to type commands on a keyboard. With a GUI tool, the
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`user may interact with the graphical elements on a display, such as by using a
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`keyboard, a mouse, a stylus, a finger, or other pointing device. GUI tools are
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`constructed using a combination of software and hardware elements. In addition to
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`desktop and laptop computers, GUI tools are used in a wide variety of handheld
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`devices. GUIs are also sometimes referred to as MMIs (man-machine interfaces) or
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`HCIs (human-computer interfaces). These GUIs are analogous to mechanical
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`devices because, like mechanical devices, they are designed to permit a user to
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`interact with a machine. For example, in older airplanes, the cockpit utilizes
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`physical buttons, levers or switches to control the operation of the airplane. In
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`modern day aircraft, the cockpit utilizes GUIs that enable the pilot to control the
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`operation of the airplane. As another example, old calculators have push buttons
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`that enable the user to enter values or operations, whereas today’s smartphones
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`utilize, for example, a GUI that enables the user to enter the same values or
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`operations.
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`23. GUI tools like the invention of the ’374 patent are typically developed
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`for and used by professionals, particularly at the time of the invention. Thus, in
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`addition to providing desirable functionality, these GUI tools must be highly stable
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`and reliable. In my experience, GUI tools for trading are extensively tested,
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`including testing in all kinds of simulated market conditions, well in advance of
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`any use in a live market. As discussed below, GUI tools are mission critical for
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`professional electronic traders. They are the primary tools of their trade, just like
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`GUIs in a cockpit are the primary tools for pilots flying modern day aircraft.
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`24.
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`In the course of my industry experience, I have hired people to do
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`GUI tool development for electronic trading. Backgrounds included previous
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`experience in software development, technical degrees in computer science,
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`engineering or other science disciplines, or equivalent work experience, etc.
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`25.
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`In my opinion, one of ordinary skill in the art for purposes of this
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`proceeding is a person having (1) a bachelor's degree or equivalent experience and
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`(2) two years of experience designing and/or programming graphical user
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`interfaces, including experience designing and/or programming graphical user
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`interfaces for electronic trading based on input from a person with knowledge of
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`the needs of an electronic trader. I have a greater level of skill, but I can speak
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`about what one of ordinary skill in the art would understand because of my
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`background and experience.
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`26.
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`I have reviewed Mr. Roman’s definition of one of ordinary skill
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`(submitted with the Petition) and I disagree with it for at least the reason that it
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`does not provide sufficient weight to the experience designing and/or programming
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`GUIs for electronic trading based on input from a person with knowledge of the
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`needs of an electronic trader. Mr. Roman’s definition instead focuses primarily on
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`GUI experience, with no access to or knowledge of the needs of an electronic
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`trader, which is plainly deficient. He suggests that merely direct or indirect
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`experience with trading or related systems is adequate. This is incorrect because it
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`ignores the needs of the trader for whom the GUI is designed. In addition, I
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`disagree with their assertion that the person of ordinary skill would need a
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`bachelor’s degree or higher in computer science or computer engineering. Based
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`on my experience in the industry for over 20 years, I believe that this requirement
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`is too restrictive, again skewing the view of the person of ordinary skill toward a
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`generalized GUI designer and away from the recited field.
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`27. My definition of the person of ordinary skill in the art is that of a
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`baseline worker in this industry. Many individuals in the industry, as one would
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`expect, have a significantly higher level of skill. My level of skill in the art is
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`significantly higher than that of the person of ordinary skill, and my level of skill
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`was attained through my numerous relevant work experiences, including trading
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`experience, self–taught programming proficiencies, as well as experiences in
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`designing, developing and implementing electronic trading systems.
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`V. BACKGROUND OF THE INDUSTRY
`28. To understand the claimed invention, it is important to have an
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`understanding of the nature of the industry in which it was developed and the
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`mission critical nature of tools used for electronic trading. The electronic trading
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`industry is made up of various groups. These groups include the exchanges,
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`Futures Commissions Merchants (“FCMs”) (the equivalent of equity brokers for
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`futures), technology providers, such as Independent Software Vendors (“ISVs”)
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`whose primary business is to provide GUI tools, trading firms, brokers and
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`individual traders. All of the groups identified above provide complimentary
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`services and work together to facilitate the execution of trades. TT is an example
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`of an ISV. Examples of more well-diversified vendors include CQG and
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`Bloomberg. Examples of an FCM include RCG and Goldman Sachs. Examples of
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`an exchange include the CME, Eurex and the Tokyo Stock Exchange (“TSE”). A
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`broker is generally speaking someone who, typically for a fee, executes buy and
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`sell orders on behalf of another. An FCM is an entity that facilitates the buying
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`and selling of futures contracts and typically holds monetary funds as margin for
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`trading activities. An exchange is a marketplace in which things of value are
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`traded, such as securities, options, futures etc.
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`29. TradeStation Group, Inc. is the parent company of TradeStation
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`Technologies, Inc., a trading technology company, and TradeStation Securities,
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`Inc., an online securities and futures brokerage firm (broker and FCM). I may
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`refer to these Petitioners collectively as “TradeStation.” TradeStation
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`Technologies was founded under the name Omega Research in 1982, which
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`initially focused on developing and marketing tools that would allow users without
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`a technical or computer programming background to program and test their own
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`trading strategies. Since that time, TradeStation has been engaged in developing
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`and marketing technology for traders, including, after the advent of electronic
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`exchanges, technology for electronic trading. TradeStation’s technology has
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`included, and today includes, GUI tools for electronic trading. Thus, TradeStation
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`has been significantly involved in the technology side of the trading industry for
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`over thirty years. TradeStation is a large company that invests millions of dollars
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`annually on technology development. TradeStation revenue is derived from a
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`combination of a monthly fee for access to their trading platform and/or a fee per
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`trade. IBG LLC, Interactive Brokers LLC and IBFX, Inc., (hereinafter
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`collectively, “IB”) are likewise very large technology and trading companies. IB
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`conducts an electronic brokerage business, providing its customers what it claims
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`to be one of the most effective and efficient trading platforms in the industry. IB
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`charges a fee for access to its data feed, as well as fees on a per share traded basis,
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`and recently reported annual net revenue is in excess of one billion dollars.
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`30. Prior to the advent of electronic trading, the trading of futures
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`occurred in what is known as the open outcry system. Open outcry is the name of
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`a system of financial trading, used for over one hundred years, in which traders
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`shout their bids and offers aloud in an area of a trading floor referred to as a trading
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`pit. In the trading pit, traders utilize shouting and hand signals to transfer
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`information about buy and sell orders to other traders. To avoid confusion, the
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`inside market prices were the focus, and traders could only shout and signal
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`regarding their interest at the best bid/offer or at a price that improves the best
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`bid/offer. Orders (bids or offers) at prices away from the inside market were not
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`allowed. Traders executed trades by agreeing with another trader in the pit on a
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`price and quantity. As such, there was no transparency into what interest others
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`might have at prices away from the best bid/offer. Indeed, traders in a trading pit
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`frequently would try to hide their interest in order to obtain the best prices for their
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`orders. In addition, in the trading pit personality and physical presence played a
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`role—there was no anonymity. Traders often wore distinguishing clothing, such as
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`colorful jackets or even platform shoes, to garner attention in the pits in an attempt
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`to gain priority for order execution. For the same reasons, certain locations in the
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`trading pit could be more desirable than others. Furthermore, each pit was limited
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`to contracts for a particular product and thus, in the open outcry system, the trader
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`could only trade the contracts that were available in the pit where he/she stood.
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`Mobility between the pits was limited, by physical distance between the pits,
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`timeliness of the opportunity, and other factors. In its early form, there was no
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`technology in the open outcry trading pits. Nonetheless, open outcry pit trading
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`was viewed as incredibly efficient and it was viewed favorably and supported by
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`large numbers of industry groups.
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`31. As technology developed, exchanges and trading entities utilized the
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`technology within the open outcry trading paradigm. For example, technology was
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`added by the exchanges to assist in the processing of orders executed in the open
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`outcry pits, which is sometimes referred to as backend processing. Similarly,
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`brokers began to utilize technology to route customer orders to the appropriate
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`trader in the pit. An example of this type of technology is shown in the patent to
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`Page 19 of 86
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`Gutterman. See Ex. 1004. Even though it utilized technology to facilitate the
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`functioning of the entities involved in the trading pit, the open outcry paradigm
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`was essentially unchanged.
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`32. Subsequently a different paradigm appeared, which very rapidly
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`changed the way trading was done. Many in the industry, of course, resisted the
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`new paradigm, especially in the United States. The new paradigm was electronic
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`trading. As opposed to the use of computers to facilitate the open outcry system, I
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`understand “electronic trading” to refer to technologies that allow a trader to send
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`an order to an electronic exchange, where the exchange uses technology to
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`implement a matching engine (hardware and software). The electronic exchanges
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`typically publish rules advising users of the manner in which the exchange will
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`prioritize and match orders. Technologies that assist in the functioning of an open
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`outcry trading pit, such as order routing or order management technologies, are not
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`electronic trading. Initially, electronic trading was used to extend trading hours,
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`where the electronic markets could be utilized after the open outcry pits had
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`closed. Later, electronic trading was used as a complete replacement for the open
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`outcry trading pits. In the new paradigm, electronic trading involves providing
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`traders with real time data feeds and mission critical GUIs for interacting with the
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`electronic exchange. In this paradigm, traders no longer pick who they trade with.
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`Instead, traders send orders at any desired price and quantity as electronic
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`Page 20 of 86
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`messages that get queued and matched by an electronic exchange (computer
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`hardware and software), typically on a first-in-first-out basis. In this system, the
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`traders are anonymous to each other. The electronic exchange publishes this mass
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`amount of data to people all over the world, so the information is known and
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`transparent in contrast to the situation in traditional open outcry trading pits.
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`33.
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`In the early period of applying technology to trading, there were
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`different approaches and theories driving technology development. Some entities
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`took the approach, which now seems silly in hindsight, of trying to continue the pit
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`paradigm by taking advantage of technology to continue pit trading. The patent to
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`Belden is an example of this approach that attempted to continue the pit paradigm
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`by mimicking the trading pit. See Ex. 1005. Under the pit-mimicking approach,
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`the GUI tools were constructed such that the trader could see an electronic
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`representation of the pit and an electronic representation of other traders
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`participating within that pit. In the representation of the pit, the various
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`representations of traders typically also displayed the trader’s offers and/or bids at
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`the inside market prices. In order to execute a trade, the trader would click on an
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`icon representing a trader in the pit. There was no matching engine (i.e., no
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`electronic exchange) in these types of pit-mimicking systems. One train of thought
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`in support of this approach was that traders who had previously traded in the
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`trading pits would like it and adapt more readily because it would be more familiar
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`21
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`Page 21 of 86
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`to them, in the sense that, as in open outcry pit trading, the traders were able to
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`select the other trader with whom they wanted to trade. Also, several United States
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`exchanges and many of their members wanted to retain the open outcry pit trading
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`model.
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`34. The other approach looked to create a new and different electronic
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`trading paradigm. Specifically, this approach was focused on the development of
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`GUI tools for electronic trading and the development of electronic exchanges. The
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`invention of the patent here falls into this second approach. The invention is not
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`compatible with a pit mimicking approach. Likewise, a pit mimicking approach, is
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`not compatible with an electronic exchange. The pit mimicking approach is
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`merely a continuation of the open outcry paradigm, with an incremental utilization
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`of technology. By the time of the invention, those of ordinary skill in the art
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`working in the direction of the electronic trading approach had issues with the pit
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`mimicking approach. For example, the pit mimicking approach was really just a
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`platform for users to execute trades with each other, continuing the open outcry
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`paradi
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