UNITED STATES PATENT AND TRADEMARK OFFICE
`________________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`________________
`
`APPLE INC.
`Petitioner,
`
`v.
`
`UNIVERSAL SECURE REGISTRY LLC
`Patent Owner
`________________
`
`Case CBM2018-00022
`U.S. Patent No. 9,530,137
`________________
`
`PATENT OWNER'S PRELIMINARY RESPONSE
`
`
`
`
`
`
`
`
`
`

`

`TABLE OF CONTENTS
`
`Case No. CBM2018-00022
`U.S. Patent No. 9,530,137
`
`Page
`
`I. 
`II. 
`
`B. 
`
`2. 
`
`2. 
`
`INTRODUCTION ........................................................................................... 1 
`OVERVIEW OF THE '137 PATENT ............................................................. 4 
`A. 
`The '137 Patent Specification ................................................................ 4 
`B. 
`The '137 Patent Claims .......................................................................... 9 
`C. 
`Prosecution History of the '137 Patent ................................................ 10 
`III.  LEVEL OF ORDINARY SKILL IN THE ART ........................................... 10 
`IV.  CLAIM CONSTRUCTION .......................................................................... 11 
`V. 
`THE '137 PATENT DOES NOT QUALIFY AS A "COVERED
`BUSINESS METHOD PATENT" ................................................................ 12 
`A. 
`The claims are not directed to a "financial product or service" .......... 13 
`1. 
`Dependent claims 8, 10, and 11 have been disclaimed
`and may not be considered in determining CBM
`eligibility ................................................................................... 15 
`The claimed systems are not limited to financial
`transactions ................................................................................ 16 
`The claims are directed to a "technological invention" ...................... 17 
`1. 
`The claimed invention recites a novel and inventive
`technological feature that provides a technical solution to
`a technical problem ................................................................... 18 
`Petitioner fails to show the '137 patent does not claim a
`"technological invention" .......................................................... 21 
`VI.  THE CHALLENGED CLAIMS OF THE '137 PATENT ARE
`DIRECTED TO PATENT-ELIGIBLE SUBJECT MATTER ...................... 25 
`A. 
`The claims are not directed to an abstract idea ................................... 28 
`B. 
`The claims provide a technical innovation .......................................... 35 
`VII.  CONCLUSION .............................................................................................. 38 
`
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`Case No. CBM2018-00022
`U.S. Patent No. 9,530,137
`TABLE OF AUTHORITIES
`
`Page
`
`CASES 
`Alice Corp. Pty. Ltd. v. CLS Bank Int'l,
`134 S. Ct. 2347 (2014) ........................................................................... passim
`Bascom Glob. Internet Servs., Inc. v. AT&T Mobility, LLC,
`827 F.3d 1341 (Fed. Cir. 2016) ..................................................................... 36
`Bilski v. Kappos,
`561 U.S. 593 (2010).......................................................................... 26, 30, 36
`Biscotti Inc. v. Microsoft Corp.,
`2016 WL 6611487 (E.D. Tex. Nov. 9, 2016) ................................................ 12
`Bloomberg L.P. v. Quest Licensing Corporation,
`CBM2014-00205 (PTAB Apr. 7, 2015) ................................................... 3, 23
`Blue Calypso, LLC v. Groupon, Inc.,
`815 F.3d 1331 (Fed. Cir. 2016) .......................................................... 2, 13, 14
`Cuozzo Speed Techs., LLC v. Lee,
`136 S. Ct. 2131 (2016) ................................................................................... 11
`Diamond v. Diehr,
`450 U.S. 175 (1981)....................................................................................... 35
`Enfish, LLC v. Microsoft Corp.,
`822 F.3d 1327 (Fed. Cir. 2016) ............................................................. passim
`Experian Mktg. Sol'ns, Inc. v. RPost Commc'ns Ltd.,
`CBM2014-0010 (PTAB Apr. 22, 2014) ........................................................ 23
`Facebook, Inc. v. Skky, LLC,
`Case CBM2016-00091 (PTAB Sept. 28, 2017) ............................................ 16
`Finjan, Inc. v. Blue Coat Systems, Inc.,
`879 F.3d 1299 (Fed. Cir. 2018) ........................................................ 21, 33, 34
`Guinn v. Kopf,
`96 F.3d 1419 (Fed. Cir. 1996) ....................................................................... 15
`Idexx Labs., Inc. v. Charles River Labs., Inc.,
`2016 WL 3647971 (D. Del. Jul. 1, 2016) ...................................................... 30
`In re Trans Texas Holdings Corp.,
`498 F.3d 1290 (Fed. Cir. 2007) ..................................................................... 12
`
`
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`ii
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`Case No. CBM2018-00022
`U.S. Patent No. 9,530,137
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`King Pharms., Inc. v. Eon Labs, Inc.,
`616 F.3d 1267 (Fed. Cir. 2010) ..................................................................... 35
`Mayo Collaborative Services v. Prometheus Labs., Inc.,
`132 S. Ct. 1289 (2012) ................................................................................... 25
`McRO, Inc. v. Bandai Namco Games Am. Inc.,
`837 F.3d 1299 (Fed. Cir. 2016) ........................................................ 28, 30, 31
`Plaid Tech. Inc., v. Yodlee, Inc.,
`CBM2016-00070 (PTAB Oct. 6, 2016) ................................................. 13, 15
`Research Corp. Techs., Inc. v. Microsoft Corp.,
`627 F.3d 859 (Fed. Cir. 2010) ....................................................................... 28
`SAS Institute, Inc. v. Iancu,
`138 S. Ct. 1348 (2018) ................................................................................... 26
`Secure Axcess, LLC v. PNC Bank Nat'l Ass'n,
`848 F.3d 1370 (Fed. Cir. 2017) .......................................................... 1, 13, 14
`Secured Mail Sols. v. Universal Wilde,
`873 F.3d 905 (Fed. Cir. 2017) ................................................................ 32, 35
`Shire Dev. LLC v. Amneal Pharmas. LLC,
`2016 WL 4119940 (D.N.J. Aug. 2, 2016) ..................................................... 12
`Smart Meter Techs., Inc. v. Duke Energy Corp.,
`2017 WL 2954916 (D. Del. July 11, 2017) ................................................... 32
`Smart Sys. Innovations, LLC v. Chi. Transit Auth.,
`873 F.3d 1364 (Fed. Cir. 2017) .............................................................. 32, 33
`Unwired Planet, LLC v. Google Inc.,
`841 F.3d 1376 (Fed. Cir. 2016) .......................................................... 1, 13, 14
`Vectra Fitness, Inc. v. TNWK Corp.,
`162 F.3d 1379 (Fed. Cir. 1998) ..................................................................... 15
`Yahoo! Inc. v. Almondnet, Inc.,
`CBM2017-00051 (PTAB Nov. 28, 2017) .......................................... 2, 13, 15
`
`STATUTARY AUTHORITIES 
`35 U.S.C. § 101 ................................................................................................ passim
`35 U.S.C. § 253 ........................................................................................................ 15
`35 U.S.C. § 324 ................................................................................................... 3, 25
`37 C.F.R. § 1.321 ..................................................................................................... 15
`
`
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`iii
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`Case No. CBM2018-00022
`U.S. Patent No. 9,530,137
`37 C.F.R. § 42.300 ................................................................................................... 11
`37 C.F.R. § 42.301 ........................................................................................... passim
`37 C.F.R. § 42.304 ............................................................................................ 11, 12
`AIA § 18 ........................................................................................................... passim
`
`OTHER AUTHORITIES 
`157 Con. Rec. S5402 (daily ed. September 8, 2011) (statement of Sen Kyl) ......... 22
`
`
`
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`Case No. CBM2018-00022
`U.S. Patent No. 9,530,137
`
`TABLE OF EXHIBITS
`
`Exhibit No. Description
`2001
`USR Disclaimer Filed July 6, 2018
`
`
`
`
`
`
`v
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`

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`Case No. CBM2018-00022
`U.S. Patent No. 9,530,137
`
`I.
`
`INTRODUCTION
`
`Patent Owner Universal Secure Registry LLC ("PO") submits this Preliminary
`
`Response to the Petition for Covered Business Method Review (Paper No. 3) ("the
`
`Petition") filed by Petitioner Apple Inc. ("Petitioner").
`
`The Petition should be denied for at least three independent reasons. First,
`
`Petitioner fails to meet its burden of showing that the '137 patent "claims [an] …
`
`apparatus…for performing…operations used in the practice…of a financial product
`
`or service." AIA § 18(d)(1); 37 C.F.R. § 42.301(a). Petitioner erroneously argues
`
`that the '137 patent is a CBM patent because it claims systems that enable a
`
`"transaction" while disclosing that the transaction "can be financial in nature." Pet.
`
`at 18-19 (emphasis added). Petitioner’s argument contradicts established Federal
`
`Circuit law, as a patent does not "become[] a CBM patent because its practice could
`
`involve" financial activity. Unwired Planet, LLC v. Google Inc., 841 F.3d 1376,
`
`1382 (Fed. Cir. 2016) (emphasis added). Instead, a CBM patent must include at
`
`least one claim that "require[s]…'finance-related activities.'" Secure Axcess, LLC
`
`v. PNC Bank Nat'l Ass'n, 848 F.3d 1370, 1381 (Fed. Cir. 2017) (emphasis added),
`
`vacated as moot, 138 S. Ct. 1982 (U.S. May 14, 2018). The '137 patent includes no
`
`
`
`1
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`

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`Case No. CBM2018-00022
`U.S. Patent No. 9,530,137
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`such claim.1 To the contrary, the claimed systems can be used to authenticate a user
`
`for many non-financial transactions, such as transactions selectively providing
`
`authorized users with access to a person's postal address, telephone number, medical
`
`records, job application information, or other confidential information. See, e.g., Ex.
`
`1001 at 4:8-15, 11:10-22, 15:6-57, 17:5-17, 40:15-21, 42:64-43:3. Because there is
`
`nothing "explicitly or inherently financial" in any of its claims, the '137 patent is not
`
`a CBM patent and the Petition should be denied. Blue Calypso, LLC v. Groupon,
`
`Inc., 815 F.3d 1331, 1340 (Fed. Cir. 2016).
`
`Separately, Petitioner fails to meet its burden of showing that the '137 patent
`
`is not a patent for a "technological invention[]." AIA § 18(d)(1), 37 C.F.R.
`
`§ 42.301(a). The Petition mischaracterizes the problem to be solved and the '137
`
`patent’s claimed solution. The Petition instead focuses on individual hardware
`
`elements, ignoring the Federal Circuit's guidance that software can also be
`
`technological. See, e.g., Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1335 (Fed.
`
`
`1 For simplicity, PO has disclaimed dependent claims 8, 10, and 11. See Ex.
`
`2001. These now-disclaimed claims, which described possible applications of the
`
`inventions, are no longer included in the '137 patent and may not be considered. See,
`
`e.g., Yahoo! Inc. v. Almondnet, Inc., CBM2017-00051, Paper 10, *14-15 (PTAB
`
`Nov. 28, 2017).
`
`
`
`2
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`Case No. CBM2018-00022
`U.S. Patent No. 9,530,137
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`Cir. 2016). And the Petition fails to meaningfully address "the claimed subject
`
`matter as a whole." 37 C.F.R. § 42.301(b) (emphasis added). In fact, the Petition
`
`barely addresses the actual claim language at all. These are fatal flaws that warrant
`
`denial of the Petition. See, e.g., Bloomberg L.P. v. Quest Licensing Corporation,
`
`CBM2014-00205, Paper 16, *9 (PTAB Apr. 7, 2015) (denying institution because
`
`petitioner "failed to assess the claims as a whole…and has instead focused on certain
`
`individual elements"). When viewed as a whole and in light of the specification, the
`
`claimed subject matter of the '137 patent involves a novel and inventive
`
`technological feature that provides an improved technical solution to a technical
`
`problem specifically arising in distributed electronic transactions: how to securely
`
`and reliably authenticate a user and the user's device-initiated transaction remotely
`
`and without compromising the user's sensitive information. For this reason as well,
`
`the '137 patent is not a CBM patent, and the Petition should be denied.
`
`Lastly, although the Board should not reach this defective Petition's asserted
`
`invalidity ground, Petitioner fails to meet its burden of showing that any Challenged
`
`Claim of the '137 patent is "more likely than not" (35 U.S.C. § 324(a)) directed to
`
`subject matter that is ineligible for patenting under 35 U.S.C. § 101. The Petition
`
`sets
`
`forth only superficial analysis
`
`that mischaracterizes
`
`the
`
`invention,
`
`oversimplifies (or outright ignores) key limitations of the claims, and fails to fully
`
`consider the claim elements as an ordered combination. Moreover, and tellingly,
`
`
`
`3
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`U.S. Patent No. 9,530,137
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`Petitioner never contends that any claim presents any risk of preemption, "the
`
`concern that drives" all Section 101 jurisprudence. Alice Corp. Pty. Ltd. v. CLS Bank
`
`Int'l, 134 S. Ct. 2347, 2354 (2014). In fact, the '137 patent presents no risk of
`
`preemption because the claimed inventions are not directed to a fundamental or long-
`
`prevalent practice, but to a specific, concrete, technological solution providing an
`
`improved secure distributed transaction enablement system that incorporates both
`
`local and remote authentication without compromising the user's sensitive
`
`information. As a result, the '137 patent is directed to patent-eligible subject matter
`
`under 35 U.S.C. § 101.
`
`Accordingly, the Board should deny the Petition because the '137 patent is
`
`ineligible for CBM review and because Petitioner has failed to show that it is more
`
`likely than not that any Challenged Claim of the '137 patent is directed to
`
`unpatentable subject matter.
`
`II. OVERVIEW OF THE '137 PATENT
`A. The '137 Patent Specification
`The '137 patent relates to a unique and highly secure distributed transaction
`
`approval system including a local first device that authenticates a user of the device
`
`based on secret information and biometric information provided by the user, and that
`
`obtains transaction approval from a remote second device based on authentication
`
`information and other specific data that is generated and transmitted by the user's
`
`
`
`4
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`U.S. Patent No. 9,530,137
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`device, as well as additional authentication information available at the second
`
`device. See, e.g., Ex. 1001 at 3:63-5:31; Figs. 3-4, 20-23.
`
`Figure 21 depicts one possible embodiment of such a transaction approval
`
`system:
`
`
`
`The claimed transaction approval system can be used to authenticate a user in
`
`connection with enabling many different types of transactions, both financial and
`
`non-financial in nature. As one example, the system can be used to selectively
`
`provide authorized users with access to perform transactions involving various types
`
`
`
`5
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`Case No. CBM2018-00022
`U.S. Patent No. 9,530,137
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`of confidential information stored in a secure database. See, e.g., id. at 4:8-15 ("an
`
`information system that may be used…to selectively provide information about a
`
`person to authorized users. Transactions to and from a secure database may take
`
`place using a public key/private key security system."). "For example, a person may
`
`wish to participate in a transaction to give a potential employer one-time access to
`
`job application information." Id. at 17:11-13. As described in connection with
`
`Figures 3 and 4, other transactions might provide "Address Information," "Financial
`
`Information," "Medical Information," or "Tax Information." Id.; see also 15:6-57.
`
`Still other transactions might involve "any of a wide variety of acts including:
`
`authorizing a withdrawal of money from a user's account, permitting the user access
`
`to a secure area, permitting a user to view medical information concerning
`
`themselves or a third party, or permitting the user to access other confidential
`
`information." Id. at 42:64-43:3. A "transaction processor" in these transactions
`
`might be, for example, a "store clerk, security guard, medical service provider, etc."
`
`Id. at 40:17-18.
`
`The claimed invention provides improved transaction security by providing a
`
`system where users locally authenticate themselves at a first device using multi-
`
`factor authentication (e.g., a PIN code and a biometric, such as a fingerprint) before
`
`the first device generates a transaction approval request that it transmits to a remote
`
`second device. See, e.g., id. at 29:21-44; Fig. 21. That transaction approval request
`
`
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`6
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`Case No. CBM2018-00022
`U.S. Patent No. 9,530,137
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`from the first device is improved as well. See, e.g., id. at 16:49-17:54; Figs. 6, 21.
`
`The request signal(s) include at least three specific types of data: first authentication
`
`information, an indicator of the device's biometric authentication of the user, and a
`
`one time code that is a time varying value. See, e.g., id. at 14:26-53, 32:31-33:19;
`
`Figs. 21, 23. The request signal(s) are sent to a second device for authorization of
`
`the transaction (e.g., by a server). The second device may return an enablement
`
`signal based on at least the transmitted indication of biometric authentication and
`
`first authentication information of the user, as well as second authentication
`
`information of the user available at the second device. See, e.g., id. at 33:20-34:6;
`
`Figs. 21, 24-25.
`
`The claimed invention solves a technical problem specifically encountered in
`
`distributed electronic transaction approval systems. One important concern is
`
`ensuring that the person remotely initiating a transaction is an authorized user, and
`
`not someone fraudulently using a counterfeit or stolen device (e.g., access card,
`
`credit card, phone, etc.). The claimed invention addresses this concern by locally
`
`authenticating the user of the first device through multifactor authentication (e.g., a
`
`secret PIN and fingerprint), and by generating and sending the remote second device
`
`an indication of biometric authentication and other data that is difficult to
`
`counterfeit. See, e.g., id. at 2:50-52, 13:62-14:7, 22:16-20. Another critical concern
`
`in a distributed electronic transaction approval system is preventing the interception
`
`
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`7
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`Case No. CBM2018-00022
`U.S. Patent No. 9,530,137
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`of sensitive information that could be fraudulently used in future transactions. The
`
`claimed invention addresses this concern by generating and sending authentication
`
`information (rather than requiring users to send their social security number,
`
`password, credit card number, or other sensitive information) from the local first
`
`device to the remote second device, and by incorporating a time varying value that
`
`may be used to prevent a bad actor from intercepting and later resubmitting the same
`
`request signal(s) to the second device in a replay attack. See, e.g., id. at 4:23-31,
`
`15:43-50, 18:13-34, 19:45-67.
`
`Hence, the '137 patent provides an improved secure distributed transaction
`
`approval system. A user needs more than just possession of the local device to
`
`conduct transactions, as the claimed system locally authenticates both secret
`
`information and biometric information from the user before it engages in a
`
`transaction, protecting against fraudulent transactions using a stolen device.
`
`Furthermore, the device in the claimed system does not publish or send the user’s
`
`secret information or other sensitive information over a network, where it might be
`
`stolen and misused. Instead, the device generates signal(s) including authentication
`
`information, indication of the device’s authentication of the user, and a time varying
`
`value, and sends those to the second device for transaction approval. And, inclusion
`
`of the time varying value protects against interception and resubmission of signal(s)
`
`in a replay attack.
`
`
`
`8
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`Case No. CBM2018-00022
`U.S. Patent No. 9,530,137
`
`The '137 Patent Claims
`
`B.
`The '137 patent includes 12 claims, of which claims 1 and 12 are independent.
`
`Independent claim 1 (reproduced below) is illustrative of many aspects of the
`
`claimed inventions described above:
`
`1. A system for authenticating a user for enabling a transaction, the system
`comprising:
`
`
`a first device including:
`
`
`
`
`
`a first processor, the first processor programmed to authenticate a
`user of the first device based on secret information and to retrieve or
`receive first biometric information of the user of the first device;
`
` a
`
` first wireless transceiver coupled to the first processor and
`programmed to transmit a first wireless signal including first
`authentication information of the user of the first device; and
`
` a
`
` biometric sensor configured to capture the first biometric
`information of the user;
`
`wherein the first processor is programmed to generate one or more
`signals including the first authentication information, an indicator of
`biometric authentication, and a time varying value in response to
`valid authentication of the first biometric information, and to
`provide the one or more signals including the first authentication
`information for transmitting to a second device; and
`
`wherein the first processor is further configured to receive an
`enablement signal from the second device; and
`
`the system further including the second device that is configured to
`provide the enablement signal indicating that the second device
`approved the transaction based on use of the one or more signals;
`
`
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`9
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`Case No. CBM2018-00022
`U.S. Patent No. 9,530,137
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`wherein the second device includes a second processor that is
`configured to provide the enablement signal based on the indication
`of biometric authentication of the user of the first device, at least a
`portion of the first authentication information, and second
`authentication information of the user of the first device to enable
`and complete processing of the transaction.
`
`
`Ex. 1001 at 45:27-61. Claim 12 recites similar limitations. Id. at 46:55-47:14.
`
`C.
`The
`
`Prosecution History of the '137 Patent
`
`'137 patent
`
`issued on December 27, 2016 from Application
`
`No. 15/019,660 filed on February 9, 2016.
`
`The '137 patent was subject to a thorough examination by Examiner Calvin
`
`Cheung, and was allowed over a large body of cited prior art. See Ex. 1001 at 1-3.
`
`Examiner Cheung indicated that he allowed the claims of the '137 patent because the
`
`prior art taken either individually or in combination with other prior art of record
`
`failed to disclose, suggest, teach, or render obvious the claimed limitations in the
`
`context of the invention as a whole. See Ex. 1010 at 7-8.
`
`With the benefit of the Supreme Court's decision in Alice Corp. v. CLS Bank
`
`Int'l, 134 S. Ct. 2347 (2014) and more than two years of subsequent Section 101
`
`jurisprudence, Examiner Cheung never raised any concern that the claims of the '137
`
`patent were directed to ineligible subject matter under 35 U.S.C. § 101.
`
`III. LEVEL OF ORDINARY SKILL IN THE ART
`A person of ordinary skill in the art relevant to the '137 patent at the time of
`
`the invention would have a Bachelor of Science degree in electrical engineering
`
`
`
`10
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`Case No. CBM2018-00022
`U.S. Patent No. 9,530,137
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`and/or computer science, and three years of work or research experience in the fields
`
`of secure transactions and encryption, or a Master's degree in electrical engineering
`
`and/or computer science and two years of work or research experience in related
`
`fields. PO's description of level of ordinary skill in the art is similar to that of the
`
`Petition, but requires further and more specialized education and/or experience with
`
`the complex technology of the '137 patent. See Pet. at 15-16. The positions set forth
`
`in this Preliminary Response would be the same under either parties' proposal.
`
`IV. CLAIM CONSTRUCTION
`Claim terms in a CBM review are given their broadest reasonable
`
`interpretation ("BRI") in view of the specification in which they appear. 37 C.F.R.
`
`§ 42.300(b); see also Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131, 2142 (2016).
`
`Petitioner identifies three terms that purportedly require construction:
`
`"biometric information," "secret information," and "authentication information." Pet.
`
`at 26-32. PO contends construction of these terms is not necessary to resolve the
`
`matters raised by the Petition and this Preliminary Response, and that all terms
`
`should be given their broadest reasonable interpretation in light of the specification.2
`
`
`2 PO offers the foregoing claim construction proposal to comply with 37
`
`C.F.R. §§ 42.300(b) and 42.304(b)(3) solely for purposes of this Petition and does
`
`not necessarily reflect appropriate claim constructions in litigation. See, e.g., In re
`
`
`
`11
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`Case No. CBM2018-00022
`U.S. Patent No. 9,530,137
`V. THE '137 PATENT DOES NOT QUALIFY AS A "COVERED
`BUSINESS METHOD PATENT"
`
`Covered business method review is available only for patents that (1) claim
`
`"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"; and (2) are not "technological inventions." AIA § 18(a)(1) & (d)(1); 37
`
`C.F.R. § 42.301. The burden falls on the petitioner to show in the petition that the
`
`challenged patent meets these requirements. See 37 C.F.R. § 42.304(a) ("The
`
`petitioner must demonstrate that the patent for which review is sought is a covered
`
`business method patent"). Petitioner wholly fails to show that either requirement is
`
`met. In fact, the '137 patent's claims are not directed to a financial product or service,
`
`
`Trans Texas Holdings Corp., 498 F.3d 1290, 1297 (Fed. Cir. 2007). PO, therefore,
`
`reserves the right to pursue alternative constructions, including where PO does not
`
`herein propose an express construction, in district court. As multiple district courts
`
`have recognized, the PTAB's decision on claim construction (and PO's positions in
`
`a review) does not control claim construction decisions in litigation. See Shire Dev.
`
`LLC v. Amneal Pharmas. LLC, 2016 WL 4119940, at *4 n.3 (D.N.J. Aug. 2, 2016);
`
`Biscotti Inc. v. Microsoft Corp., 2016 WL 6611487, at *7 n.5 (E.D. Tex. Nov. 9,
`
`2016).
`
`
`
`12
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`Case No. CBM2018-00022
`U.S. Patent No. 9,530,137
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`and the claimed invention is clearly technological in nature. Thus, the '137 patent
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`fails to meet either part of the statutory test for CBM eligibility, and the Petition
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`should be denied without consideration of the asserted invalidity grounds.
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`A. The claims are not directed to a "financial product or service"
`The AIA provides a "narrow statutory definition" of patents that are eligible
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`for CBM review. Unwired Planet, 841 F.3d at 1381. In particular, "CBM patents
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`are limited to those with claims that are directed to methods and apparatuses of
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`particular types and with particular uses 'in the practice, administration, or
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`management of a financial product or service.'" Id. at 1382 (emphasis added).
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`"Necessarily, the statutory definition of a CBM patent requires…a claim that
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`contains…a financial activity element." Secure Axcess, 848 F.3d at 1381 (a claim
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`must "require…'finance-related activities.'"). If there is "nothing explicitly or
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`inherently financial in the construed claim language," a patent does not meet the
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`statutory definition under AIA Section 18(d)(1) and institution of CBM review must
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`be denied. Blue Calypso, 815 F.3d at 1340; see also, e.g., Plaid Tech. Inc., v. Yodlee,
`
`Inc., CBM2016-00070, Paper 8, *12-13 (PTAB Oct. 6, 2016) (collecting consistent
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`PTAB decisions and denying institution because claims had "no explicit or inherent
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`finance-related terminology or limitations"); Yahoo, CBM2017-00051, Paper 10,
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`*15-16 (denying institution because petitioner had not "shown sufficiently that [any]
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`claim term is a financial activity element").
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`
`
`13
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`

`

`Case No. CBM2018-00022
`U.S. Patent No. 9,530,137
`
`Such is the case here. There is nothing explicitly or inherently financial in the
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`claims of the '137 patent. Petitioner's reliance on the term "transaction" in the claims
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`as the statutory basis for CBM review of the '137 patent impermissibly expands the
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`scope of CBM review, and ignores Federal Circuit precedent squarely contradicting
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`Petitioner's broad interpretation of the law. Petitioner's contention that AIA Section
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`18(d)(1) covers patents claiming activities that are "incidental to a financial activity
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`or complementary to a financial activity" (Pet. at 17) was rejected by the Federal
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`Circuit. See Unwired Planet, 841 F.3d at 1382 ("reliance on whether [a] patent
`
`claims activities 'incidental to' or 'complementary to' a financial activity…was not
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`in accordance with law"); see also Secure Axcess, 848 F.3d at 1381 ("such a
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`definition of a CBM patent is beyond the scope of the statutory standard").
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`Petitioner's additional contention that the '137 patent qualifies as a CBM patent
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`because its claims include a term that the specification discloses "can be financial in
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`nature" similarly misstates the law. Pet. at 18-19. "It is not enough that [financial
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`activity] has occurred or may occur, or even that the specification speculates
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`[financial activity] might occur." Unwired Planet, 841 F.3d at 1382. Indeed, "most,
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`if not virtually all, inventors of methods or products claimed in a patent have some
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`expectation that complementary financial activity will result." Secure Axcess, 848
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`F.3d at 1381. Rather, a CBM patent must contain something "explicitly or inherently
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`financial in the construed claim language." Blue Calypso, 815 F.3d at 1340
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`
`
`14
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`

`

`Case No. CBM2018-00022
`U.S. Patent No. 9,530,137
`
`(emphasis added); see also, e.g., Plaid Tech., CBM2016-00070, Paper 8, *12-13
`
`("we must examine the language of the claims for any explicit or inherent limitation
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`to finance-related activity").
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`Petitioner has failed to show that any claim of the '137 patent contains any
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`explicitly or inherently financial limitation. In fact, Petitioner does not even allege
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`as much. Hence, the Petition should be denied.
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`1.
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`Dependent claims 8, 10, and 11 have been disclaimed and may
`not be considered in determining CBM eligibility
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`The Petition relies on certain claim terms that appear only in dependent claims
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`8, 10, and 11, which describe possible applications of the inventions. Pet. at 18-19.
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`For simplification, and without addressing whether these dependent claims contain
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`any terms that are explicitly or inherently financial, Patent Owner has filed a
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`statutory disclaimer of these claims under 35 U.S.C. § 253(a) and 37 C.F.R.
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`§ 1.321(a). See Ex. 2001.
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`"A statutory disclaimer under 35 U.S.C. § 253 has the effect of canceling the
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`claims from the patent and the patent is viewed as though the disclaimed claims had
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`never existed in the patent." Guinn v. Kopf, 96 F.3d 1419, 1422 (Fed. Cir. 1996);
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`see also Vectra Fitness, Inc. v. TNWK Corp., 162 F.3d 1379, 1383 (Fed. Cir. 1998).
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`As such, former dependent claims 8, 10, and 11 "cannot provide the basis for
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`eligibility for a covered business method patent review." Yahoo, CBM2017-00051,
`
`
`
`15
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`

`

`Case No. CBM2018-00022
`U.S. Patent No. 9,530,137
`
`Paper 10, *15; see also, e.g., Facebook, Inc. v. Skky, LLC, Case CBM2016-00091,
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`Paper 12, *6 (PTAB Sept. 28, 2017) ("The decision whether to institute a CBM
`
`patent review is based on whether a patent 'is' a covered business method patent,
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`which in turn is based on what the patent 'claims' at the time of the institution
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`decision, not as the claims may have existed at some previous time.").
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`2.
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`The claimed systems are not limited to financial transactions
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`As to claims 1-7, 9 and 12, Petitioner's entire argument focuses on the term
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`"transaction" that appears in both independent claims 1 and 12. Pet. at 18-19. As
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`Petitioner notes, the patent discloses that the term "transaction…can be financial in
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`nature." Id. (emphasis added). But, that the term "transaction" can potentially be
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`financial does not make it explicitly or inherently financial. Petitioner never
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`contends that the term "transaction" is explicitly or inherently financial, nor does
`
`Petitioner propose any constru