Case No. CBM2018-00025
`Docket No. 1033300-00306US2
`
`
`Filed on behalf of Apple Inc.
`By: Monica Grewal, Reg. No. 40,056 (Lead Counsel)
`Ben Fernandez Reg. No. 55,172 (Backup Counsel)
`Wilmer Cutler Pickering Hale and Dorr LLP
`60 State Street
`Boston, MA 02109
`Email: monica.grewal@wilmerhale.com
`
` ben.fernandez@wilmerhale.com
`
`Mark D. Selwyn (admitted pro hac vice)
`950 Page Mill Road
`Palo Alto, CA 94304
`Email: mark.selwyn@wilmerhale.com
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`APPLE INC.,
`Petitioner,
`v.
`UNIVERSAL SECURE REGISTRY, LLC,
`Patent Owner.
`_________________________________________
`Case CBM2018-00025
`
`U.S. Patent No. 8,577,813
`_________________________________________
`
`PETITIONER’S NOTICE OF APPEAL
`
`
`
`
`Docket No. 1033300-00306US2
`
`
`Filed on behalf of Apple Inc.
`By: Monica Grewal, Reg. No. 40,056 (Lead Counsel)
`Ben Fernandez Reg. No. 55,172 (Backup Counsel)
`Wilmer Cutler Pickering Hale and Dorr LLP
`60 State Street
`Boston, MA 02109
`Email: monica.grewal@wilmerhale.com
`
` ben.fernandez@wilmerhale.com
`
`Mark D. Selwyn (admitted pro hac vice)
`950 Page Mill Road
`Palo Alto, CA 94304
`Email: mark.selwyn@wilmerhale.com
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`APPLE INC.,
`Petitioner,
`v.
`UNIVERSAL SECURE REGISTRY, LLC,
`Patent Owner.
`_________________________________________
`Case CBM2018-00025
`
`U.S. Patent No. 8,577,813
`_________________________________________
`
`PETITIONER’S NOTICE OF APPEAL
`
`
`
`
`
`Case No. CBM2018-00025; Docket No. 1033300-00306US2
`Petitioner’s Notice of Appeal
`
`
`
`Director of the United States Patent and Trademark Office
`c/o Office of the General Counsel
`P.O. Box 1450
`Alexandria, VA 22314-5793
`
`Pursuant to 35 U.S.C. §§ 141-44 and 319, and 37 C.F.R. § 90.2-90.3, notice
`
`is hereby given that Petitioner Apple Inc. appeals to the United States Court of
`
`Appeals for the Federal Circuit from the “Termination Vacating Institution and
`
`Dismissing Proceeding” entered November 26, 2019 (Paper 42) in CBM2018-
`
`00025 (Exhibit A), and all prior and interlocutory rulings related thereto or
`
`subsumed therein.
`
`In accordance with 37 C.F.R. § 90.2(a)(3)(ii), Petitioner further indicates
`
`that the issues on appeal include, but are not limited to, whether the Patent Trial
`
`and Appeal Board erred in determining that the ’813 patent is not eligible for
`
`Covered Business Method Review, in terminating the CBM proceeding without
`
`deciding the patent merits, and any finding or determination supporting or related
`
`to those issues, as well as all other issues decided adversely to Petitioner in any
`
`orders, decisions, rulings, and opinions.
`
`Pursuant to 37 C.F.R. § 90.3, this Notice of Appeal is timely, having been
`
`duly filed within 63 days after the date of the November 26, 2019 decision,
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`which—regardless of its caption—is or should be treated as a Final Written
`
`Decision.
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`Case No. CBM2018-00025; Docket No. 1033300-00306US2
`Petitioner’s Notice of Appeal
`
`
`A copy of this Notice of Appeal is being filed simultaneously with the Patent
`
`Trial and Appeal Board, the Clerk’s Office for the United States Court of Appeals
`
`for the Federal Circuit, and the Director of the Patent and Trademark Office.
`
`Dated: January 17, 2020
`
` Respectfully submitted,
`
`By:
`
`/Monica Grewal/
`
`Monica Grewal, Lead Counsel
`Reg. No. 40,056
`
`- 2 -
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`
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`Case No. CBM2018-00025; Docket No. 1033300-00306US2
`Petitioner’s Notice of Appeal
`
`
`
`CERTIFICATE OF SERVICE
`
`Pursuant to 37 C.F.R. §§ 90.2(a)(1) and 104.2(a), I hereby certify that, in
`
`addition to being filed electronically through the Patent Trial and Appeal Board’s
`
`End to End (PTAB E2E), a true and correct original version of the foregoing
`
`Petitioner’s Notice of Appeal is being filed by Express Mail (Express Mail Label
`
`406058027) on this 17th day of January, 2020, with the Director of the United
`
`States Patent and Trademark Office, at the following address:
`
`Director of the United States Patent and Trademark Office
`c/o Office of the General Counsel
`United States Patent and Trademark Office
`P.O. Box 1450
`Alexandria, VA 22313-1450
`
`Pursuant to 37 C.F.R. § 90.2(a)(2) and Federal Circuit Rule 15(a)(1), and
`
`Rule 52(a),(e), I hereby certify that a true and correct copy of the foregoing
`
`Petitioner’s Notice of Appeal is being filed in the United States Court of Appeals
`
`for the Federal Circuit using the Court’s CM/ECF filing system on this 17th day of
`
`January, 2020, and the filing fee is being paid electronically using pay.gov.
`
`I hereby certify that on January 17, 2020 I caused a true and correct copy of
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`the Petitioner’s Notice of Appeal to be served via e-mail on the following attorneys
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`of record:
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`- i -
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`
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`Case No. CBM2018-00025; Docket No. 1033300-00306US2
`Petitioner’s Notice of Appeal
`
`
`
`James M. Glass (jimglass@quinnemanuel.com)
`Tigran Guledjian (tigranguledjian@quinnemanuel.com)
`Christopher A. Mathews (chrismathews@quinnemanuel.com)
`Nima Hefazi (nimahefazi@quinnemanuel.com)
`Richard Lowry (richardlowry@quinnemanuel.com)
`Razmig Messerian (razmesserian@quinnemanuel.com)
`Jordan B. Kaericher (jordankaericher@quinnemanuel.com)
`Harold A. Barza (halbarza@quinnemanuel.com)
`Quinn Emanuel USR IPR (qe-usr-ipr@quinnemanuel.com)
`
`
`By:
`
`/Monica Grewal/
`
`Monica Grewal, Lead Counsel
`Reg. No. 40,056
`
`- ii -
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`
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`Case No. CBM2018-00025; Docket No. 1033300-00306US2
`Petitioner’s Notice of Appeal
`
`
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`
`
`EXHIBIT A
`
`
`
`
`
`
`
` Paper 42
`Trials@uspto.gov
`571-272-7822 Entered: November 26, 2019
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`APPLE, INC.,
`VISA INC., and VISA U.S.A. INC.,
`Petitioner,
`
`v.
`
`UNIVERSAL SECURE REGISTRY LLC,
`Patent Owner.
`____________
`
`CBM2018-000251
`Patent 8,577,813 B2
`____________
`
`Before PATRICK R. SCANLON, GEORGIANNA W. BRADEN, and
`JASON W. MELVIN, Administrative Patent Judges.
`
`BRADEN, Administrative Patent Judge.
`
`TERMINATION
`Vacating Institution and Dismissing Proceeding
`35 U.S.C. § 324; 37 C.F.R. §§ 42.72, 42.301(a)
`
`1 Visa Inc. and Visa U.S.A. Inc., which filed a petition in CBM2019-
`00026, have been joined as petitioners in this proceeding.
`
`
`
`CBM2018-00025
`Patent 8,577,813 B2
`
`We terminate this covered business method patent review
`proceeding under § 18(a)(1)(E) of the Leahy-Smith America Invents
`Act (“AIA”), pursuant to 35 U.S.C. § 6(c) and 37 C.F.R. §§ 42.72,
`42.301(a). For the reasons that follow, we determine Petitioner has
`failed to show that U.S. Patent No. 8,577,813 B2 (Ex. 1101,
`“the ’813 patent”) qualifies for covered business method patent review,
`such that we have no power to determine the unpatentability of the
`challenged claims. Thus, we vacate our Decision to Institute this
`proceeding and terminate the covered business method (“CBM”)
`patent review under 37 C.F.R. § 42.72.
`
`I. INTRODUCTION
`Procedural History
`A.
`Apple Inc. filed a Petition requesting CBM patent review of
`claims 1, 2, 4–11, 13–20, and 22–26 of the ’813 patent. Paper 3
`(“Pet.”), 1, 19. Patent Owner timely filed a Preliminary Response.
`Paper 7 (“Prelim. Resp.”). Pursuant to 35 U.S.C. § 324(a), a CBM
`patent review originally was instituted for (1) claims 1, 2, 4–11, 13,
`16–20, and 24 under 35 U.S.C. § 103(a) as unpatentable over
`Jakobsson2 and Maritzen3; and (2) claims 14, 15, 22, 23, 25, and 26
`
`2 WO Patent Publication No. WO 2004/051585 A2, published June 17,
`2004 (“Jakobsson,” Ex. 1115).
`3 U.S. Patent Publication No. US 2004/0236632 A1, published Nov.
`25, 2004 (“Maritzen,” Ex. 1116).
`
`2
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`CBM2018-00025
`Patent 8,577,813 B2
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`under 35 U.S.C. § 103(a) as unpatentable over Jakobsson and Labrou4.
`See Paper 8 (“Dec. to Inst.”), 43.
`After institution of trial, Patent Owner filed a Patent Owner
`Response (Paper 20, “PO Resp.”), to which Petitioner filed a Reply
`(Paper 26, “Pet. Reply”) and Patent Owner filed a Sur-Reply
`(Paper 33). Patent Owner also filed Objections to Evidence (Paper 27)
`and a Motion to Strike (Paper 30). Petitioner opposed Patent Owner’s
`Motion to Strike (Paper 32), to which Patent Owner replied (Paper 34).
`An oral argument was held on August 27, 2019, together with
`co-pending IPR2018-00812 and CBM2018-00024. A transcript of the
`oral argument is included in the record. Paper 41 (“Tr.”).
`Upon consideration of the entirety of record, as explained in
`detail below, and in view of recent guidance from the U.S. Court of
`Appeals for the Federal Circuit, we determine the ’813 patent is
`directed to a technological invention and does not qualify as a CBM
`patent for purposes of the AIA. Accordingly, we terminate this CBM
`patent review. See 37 C.F.R. § 42.72 (2017).
`
`Real Parties in Interest
`B.
`Petitioner certifies that Apple Inc. is the real party in interest.
`Pet. 2.
`
`Related Matters and Infringement Suit
`C.
`As required by 37 C.F.R. § 42.8(b)(2), each party identifies
`several judicial or administrative matters that would affect or be
`
`4 U.S. Patent Publication No. US 2004/0107170 A1, published Jun. 3,
`2004 (“Labrou,” Ex. 1117).
`
`3
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`
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`CBM2018-00025
`Patent 8,577,813 B2
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`affected by a decision in this proceeding, including concurrently filed
`CBM2018-00024 and CBM2018-00026. Pet. 2–3; Paper 4, 2 (Patent
`Owner’s Mandatory Notices). Petitioner specifically identifies being
`sued in co-pending district court proceeding Universal Secure
`Registry, LLC v. Apple Inc. et al., No. 17-585-VAC-MPT (D. Del.).
`Pet. 2 (citing Ex. 1103). Petitioner, however, does not identify
`IPR2018-00067, which instituted a trial proceeding with a different
`petitioner on many of the same claims of the ’813 patent under
`35 U.S.C. § 103(a). Prelim. Resp. 1; see Unified Patents Inc. v.
`Universal Secure Registry LLC, IPR2018-00067, Paper 14 at 4 (PTAB
`May 2, 2018).
`
`The ’813 Patent
`D.
`The ’813 patent is titled “Universal Secure Registry” and is
`directed to authenticating a user using biometric and secret information
`provided to a user device, encrypted, and sent to a secure registry for
`validation. Ex. 1101, code (54), Abstract. The ’813 patent issued
`November 5, 2013, from an application filed September 20, 2011.
`Id. at codes (45), (22). The ’813 patent includes a number of priority
`claims, including dates as early as February 21, 2006. Id. at
`codes (63), (60), 1:6–32.
`1. Written Description
`The specification describes one aspect of the invention as an
`“information system that may be used as a universal identification
`system and/or used to selectively provide information about a person to
`authorized users.” Id. at 3:65–4:1. One method described for
`controlling access involves “acts of receiving authentication
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`CBM2018-00025
`Patent 8,577,813 B2
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`information from an entity at a secure computer network,
`communicating the authentication information to the secure registry
`system, and validating the authentication information at the secure
`registry system.” Id. at 4:43–48. The “universal secure registry”
`(“USR”) is described as a computer system with a database containing
`entries related to multiple people, with a variety of possible
`information about each person, including validation, access, and
`financial information. Id. at 9:35–12:18.
`Validation information in the ’813 patent “is information about
`the user of the database to whom the data pertains and is to be used by
`the USR software 18 to validate that the person attempting to access
`the information is the person to whom the data pertains or is otherwise
`authorized to receive it.” Id. at 12:19–23. Such information must
`“reliably authenticate the identity of the individual” and may include
`“a secret known by the user (e.g., a pin, a phrase, a password, etc.), a
`token possessed by the user that is difficult to counterfeit (e.g., a secure
`discrete microchip), and/or a measurement such as a biometric (e.g., a
`voiceprint, a fingerprint, DNA, a retinal image, a photograph, etc.).”
`Id. at 12:23–31. The ’813 patent describes using such information in
`combination with other information “to generate a one-time
`nonpredictable code which is transmitted to the computer system” and
`used “to determine if the user is authorized access to the USR
`database.” Id. at 12:50–60; see id. at 45:55–46:36. According to
`the ’813 patent, certain systems may relay communication between a
`user device and the secure registry through a point-of-sale (“POS”)
`device. Id. at 43:4–44:31.
`
`5
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`Patent 8,577,813 B2
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`One such system embodiment is illustrated in Figure 31,
`reproduced below.
`
`As shown above, Figure 31 depicts system 350 facilitating financial
`transactions using POS device 354, user device 352, and USR 356,
`which can communicate with one another wirelessly over network 357.
`Id. at 43:4–15. The ’813 patent states that a “financial transaction”
`may include any of sales transactions (including transactions
`conducted on-line or at a point of sale using credit or debit accounts),
`banking transactions, purchases or sales of investments and financial
`instruments, or generally the transfer of funds from a first account to a
`second account. Id. at 43:6–12.
`2. Illustrative Claims
`As noted above, a CBM patent review was instituted originally
`as to claims 1, 2, 4–11, 13–20, and 22–26. Pet. 1. Claims 1, 16,
`and 24 are independent. Claims 1 and 24 are illustrative of the
`challenged subject matter and reproduced below.
`1.
`An electronic ID device configured to allow a user
`to select any one of a plurality of accounts associated with
`the user to employ in a financial transaction, comprising:
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`6
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`CBM2018-00025
`Patent 8,577,813 B2
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`a biometric sensor configured to receive a biometric input
`provided by the user;
`a user interface configured to receive a user input including
`secret information known to the user and identifying
`information concerning an account selected by the user
`from the plurality of accounts;
`a communication interface configured to communicate
`with a secure registry;
`a processor coupled to the biometric sensor to receive
`information concerning the biometric input, the user
`interface and the communication interface, the processor
`being programmed to activate the electronic ID device
`based on successful authentication by the electronic ID
`device of at least one of the biometric input and the secret
`information, the processor also being programmed such
`that once the electronic ID device is activated the processor
`is configured to generate a non-predictable value and to
`generate encrypted authentication information from the
`non-predictable value, information associated with at least
`a portion of the biometric input, and the secret information,
`and
`to communicate
`the encrypted authentication
`information via the communication interface to the secure
`registry; and
`wherein the communication interface is configured to
`wirelessly
`transmit
`the
`encrypted
`authentication
`information to a point-of-sale (POS) device, and wherein
`the secure registry is configured to receive at least a portion
`of the encrypted authentication information from the POS
`device.
`Ex. 1101, 51:65–52:29.
`24. A method of controlling access to a plurality of
`accounts, the method comprising acts of:
`generating, with an electronic ID device, a non-predictable
`value;
`generating, with the electronic ID device, encrypted
`authentication information from the non-predictable value
`
`7
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`CBM2018-00025
`Patent 8,577,813 B2
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`generated by the electronic ID device, information
`associated with at least a portion of a biometric of the user
`received by the electronic ID device, and secret information
`provided to the electronic ID device by the user;
`communicating the encrypted authentication information
`from the electronic ID device to a secure registry via a
`point-of-sale (POS) device
`to authenticate or not
`authenticate the electronic ID device with the secure
`registry;
`initiate a financial
`to
`authorizing the POS device
`transaction involving a transfer of funds to or from the
`account selected by
`the user when
`the encrypted
`authentication information is successfully authenticated;
`and
`denying the POS device from initiation of the financial
`transaction involving a transfer of funds to or from the
`account selected by the user when the encrypted
`authentication
`information
`is
`not
`successfully
`authenticated.
`Id. at 54:24–46.
`
`II. ANALYSIS
`Principles of Law
`A.
`The Federal Circuit has held that 35 U.S.C. § 318(a)
`contemplates that a proceeding can be “dismissed” after it
`is
`instituted, and, as our prior cases have held,
`“administrative agencies possess inherent authority to
`reconsider their decisions, subject to certain limitations,
`regardless of whether they possess explicit statutory
`authority to do so.” Tokyo Kikai Seisakusho, Ltd. v. United
`States, 529 F.3d 1352, 1360 (Fed. Cir. 2008).
`Medtronic, Inc. v. Robert Bosch Healthcare Sys., Inc., 839 F.3d 1382,
`1385 (Fed. Cir. 2016). In GTNX, Inc. v. INTTRA, Inc., 789 F.3d 1309,
`1313 (Fed. Cir. 2015), the Federal Circuit held that “the Board has
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`CBM2018-00025
`Patent 8,577,813 B2
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`inherent authority to reconsider its decisions, noting that ‘nothing in
`the statute or regulations applicable here . . . clearly deprives the Board
`of that default authority.’”
`Under 37 C.F.R. § 42.72, “[t]he Board may terminate a trial
`without rendering a final written decision, where appropriate.” The
`USPTO, in discussing § 42.72, has stated that “in the rare situation
`where the issue of whether the petitioner has standing is raised after
`institution, the Board would need the flexibility to terminate or dismiss
`the review, if appropriate.” 77 Fed. Reg. 48,612, 48,648 (Aug. 14,
`2012). One of the “[g]rounds for standing” under 37 C.F.R.
`§ 42.304(a) is that “[t]he petitioner must demonstrate that the patent for
`which review is sought is a covered business method patent.” Thus,
`the burden is on Petitioner to demonstrate that the ’813 patent qualifies
`as a CBM patent as defined in § 18(a)(1)(E) of the AIA and 37 C.F.R.
`§§ 42.301, 42.304(a). Such a burden never shifts to Patent Owner.
`See, e.g., Dynamic Drinkware, LLC v. Nat’l Graphics, Inc., 800 F.3d
`1375, 1378 (Fed. Cir. 2015). The issue of whether a patent is a CBM
`patent is a matter of law that we analyze based upon underlying facts
`that are themselves based on the preponderance of the evidence.
`The analysis that follows was performed in accordance with the
`above-stated principles.
`B.
`Standing to File a Petition for CBM Review
`Section 18 of the AIA provides for the creation of a transitional
`program for reviewing CBM patents. Section 18 limits reviews to
`persons or their privies who have been sued or charged with
`infringement of a “covered business method patent.” AIA
`
`9
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`Patent 8,577,813 B2
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`§ 18(a)(1)(B); see 37 C.F.R. § 42.302. As discussed above in Section
`I.C., Petitioner represents it has been sued for infringement of the ’813
`patent and is not estopped from challenging the claims on the grounds
`identified in the Petition. Pet. 8–9 (citing Ex. 1103). We are satisfied
`Petitioner has met these requirements for standing to file a petition for
`CBM review of the ’813 patent.
`C.
`Qualifying as a CBM Patent for CBM Review
`A threshold question is whether the ’813 patent is a “covered
`business method patent,” as defined by the AIA. Although this
`question was addressed preliminarily in our Institution Decision, we
`revisit the issue now. The AIA defines a “covered business method
`patent” as “a patent that claims a method or corresponding apparatus
`for performing data processing or other operations used in the practice,
`administration, or management of a financial product or service.” AIA
`§ 18(d)(1); see 37 C.F.R. § 42.301(a). “[Section] 18(d)(1) directs us to
`examine the claims when deciding whether a patent is a [covered
`business method] patent.” Blue Calypso, LLC v. Groupon, Inc., 815
`F.3d 1331, 1340 (Fed. Cir. 2016); Unwired Planet, LLC v. Google Inc.,
`841 F.3d 1376, 1382 (Fed. Cir. 2016) (CBM patents “are limited to
`those with claims that are directed to methods and apparatuses of
`particular types and with particular uses ‘in the practice,
`administration, or management of a financial product or service’”
`(emphasis added) (quoting AIA § 18(d))); see also Secure Axcess, LLC
`v. PNC Bank Nat’l Assoc., 848 F.3d 1370, 1378 (Fed. Cir. 2017) (“The
`statutory definition by its terms makes what a patent ‘claims’
`determinative of the threshold requirement for coming within the
`
`10
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`CBM2018-00025
`Patent 8,577,813 B2
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`defined class” of a CBM patent.) (cert. granted, judgment vacated as
`moot by PNC Bank Nat. Ass’n. v. Secure Axcess, LLC, 138 S. Ct. 1982
`(2018)).
`A patent need have only one claim directed to a CBM to be
`eligible for review. See Transitional Program for Covered Business
`Method Patents—Definitions of Covered Business Method Patent and
`Technological Invention; Final Rule, 77 Fed. Reg. 48,734, 48,736
`(Aug. 14, 2012); cf. Versata Dev. Grp., Inc. v. SAP Am., Inc., 793 F.3d
`1306, 1326–27 (Fed. Cir. 2015) (accepting single claim analysis to
`determine whether to institute a CBM patent review). “When properly
`construed in light of the written description, the claim need only
`require one of a ‘wide range of finance-related activities.’” Secure
`Axcess, 848 F.3d at 1381; see also Versata, 793 F.3d at 1312–13,
`1325–26 (identifying a qualifying claim); Blue Calypso, 815 F.3d at
`1339–40 (identifying a qualifying claim); SightSound Techs., LLC v.
`Apple Inc., 809 F.3d 1307, 1315–16 (Fed. Cir. 2015) (identifying a
`qualifying claim).
`The parties dispute whether the ’813 patent is a “covered
`business method patent,” as defined in the AIA and 37 C.F.R.
`§ 42.301. See Pet. 9–19; PO Resp. 16–36; Pet. Reply 1–4; Sur-Reply
`1–4. As discussed above, it is Petitioner’s burden to demonstrate that
`the ’813 patent is a CBM patent. See 37 C.F.R. § 42.304(a). For
`reasons explained below, we conclude Petitioner fails to show that
`the ’813 patent recites claims for a “technological invention,” and
`therefore, we determine the ’813 patent is not a “covered business
`method patent.”
`
`11
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`1. Financial Product or Service
`Petitioner identifies several challenged claims that it contends
`satisfy the threshold financial requirement on the basis of their claim
`language. Pet. 11 (identifying claims 1, 7, 13, 14, 17, 20, 22–26).
`According to Petitioner, claims 1 and 24 (and those that depend from
`them) disclose a device and method for providing or denying access to
`information related to a user stored in a secure database in the context
`of a “financial transaction,” while dependent claims 7, 13, 14, 17, 20,
`22, 23, 25, and 26 all explicitly recite financial transactions, user
`account numbers, purchases, and/or selection of products or services.
`Id. Additionally, Petitioner argues that all independent claims recite a
`“point of sale” or “POS” device. Id.
`Petitioner notes that the specification defines a financial
`transaction as including “transactions conducted on-line or at a point of
`sale using credit or debit accounts, banking transactions, purchases or
`sales of investments and financial instruments or generally the transfer
`of funds from a first account to a second account.” Id. (citing
`Ex. 1101, 43:6–12). Petitioner then contends the patent specification
`makes clear that the “accounts” recited in all challenged claims can be
`financial in nature. Id. (citing Ex. 1101, 6:66–7:1 (“In still another
`aspect, a user device is configured to allow a user to select any one of a
`plurality of accounts associated with the user to employ in a financial
`transaction.”), 7:47–50 (“authorizing the POS device to initiate a
`financial transaction involving a transfer of funds to or from the
`account selected by the user when the encrypted authentication
`information is successfully authenticated”)).
`
`12
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`We agree with Petitioner, because the challenged claims on their
`face explicitly recite financial terms and a financial product and/or
`service. See, e.g., Ex. 1101, 51:65–54:51 (claims 1, 16, and 24 recite a
`“point-of-sale (POS) device”; claim 7 recites a “financial transaction”;
`claim 14 recites “options for purchase”; claims 15, 23, and 26 recite “at
`least one product or service”; claim 24 recites “financial transaction,”
`“transfer of fund to or from the account”; claims 22 and 25 recite
`“displaying option for purchase”).
`2. Exclusion for Technological Inventions
`Petitioner contends the ’813 patent is not directed to a
`“technological invention” because it leverages known technology for
`verifying an account holder’s identity based on codes and/or
`information related to the account holder before enabling a transaction.
`Pet. 14–15. Indeed, according to Petitioner, the ’813 patent concedes
`that the claimed invention is not tied to any particular technology, and
`can be implemented in “a general-purpose computer system” using “a
`commercially available microprocessor” running “any other
`commercially available operating system” and that the secure registry
`database itself “may be any kind of database,” which can communicate
`using “any [network] protocol.” Id. at 15 (quoting Ex. 1101, 10:1–
`11:28; citing Ex. 1102 ¶ 47).
`Patent Owner disputes Petitioner’s contentions, arguing that
`the ’813 patent claims a “technological invention” and, thus, is
`ineligible for CBM review. PO Resp. 16–36. According to Patent
`Owner, IBG LLC v. Trading Technologies International, Inc., 2019
`WL 581580, at *1 (Fed Cir. Feb. 13, 2019) (non-precedential) (“IBG”)
`
`13
`
`
`
`CBM2018-00025
`Patent 8,577,813 B2
`
`from the Federal Circuit has clarified the law regarding “technological
`inventions” and mandates that the ’813 patent is not eligible for CBM
`review. Id. at 18.
`IBG concerns four patents that “share a specification,” which
`describes a graphical user interface for a trading system. IBG, at *1
`(U.S Patent Nos. 6,766,304, 6,772,132, 7,676,411, and 7,813,996).
`IBG petitioned for CBM review and the Board instituted proceedings
`for each patent. Id. In the proceedings for the ’304 and ’132 patents,
`the Board upheld the patent eligibility based upon a prior Federal
`Circuit decision regarding § 101 in a separate action involving those
`two patents. Id. In the proceedings involving the ’132 and ’411
`patents, the Board held the claims were § 101 ineligible. Id. On
`appeal, the patent owner alleged the Board’s determinations that all
`four patents were not directed to a “technological invention” was
`erroneous. Id. The Federal Circuit vacated the Board’s decision for all
`four patents “because the patents at issue are for technological
`inventions and thus were not properly subject to CBM review.” Id. In
`its analysis of the Board’s determinations that none of the four patents
`were “technological inventions,” the Federal Circuit stated that
`“discussion of [the relevant] patent[] in the context of eligibility [§
`101] is instructive to the technological invention question.” Id. at *2.
`The court then noted that a district court, the Federal Circuit, and the
`Board had all found two of the four patents (’132 and ’304) at issue to
`be eligible under § 101, in particular that “the claimed subject matter is
`directed to a specific improvement to the way computers operate.” Id.
`(quotation omitted). In this context, the court held it to be “internally
`
`14
`
`
`
`CBM2018-00025
`Patent 8,577,813 B2
`
`inconsistent” for those two patents to not be “technological
`inventions.” Id. The court further held that because there was “no
`meaningful difference between the claimed subject matter of the ’132
`and ’304 patents and that of the ’411 and ’996 patents for the purposes
`of the technological invention question, the same conclusion applies in
`those cases as well.” Id.
`Patent Owner argues that IBG is identical to the facts of the
`present case because, as in IBG, both the Board and a federal district
`court have held the exact same challenged claims of the ’813 patent to
`be eligible under § 101. PO Resp. 20–23 (citing CBM2018-00026,
`Paper 11 at 24; Universal Secure Registry, LLC, No. 1:17-cv-00585-
`CFC-SRF, Doc. 137, 23–26). According to Patent Owner, it would be
`“internally inconsistent” for the Board to find the challenged claims of
`the ’813 patent to be eligible under § 101 in CBM2018-00026 but then
`to turn around in the present case and find that they are not directed to
`a technological invention. PO Resp. 20 (citing IBG, *1–*3). Patent
`Owner specifically cites to the Federal Circuit’s holding in IBG that
`“[i]f ‘the claimed subject matter is directed to a specific improvement
`to the way computers operate,’ as we held [previously], the patents are
`also for a ‘technological invention’ under any reasonable meaning of
`that term.’” PO Resp. 21–22 (citing IBG, at *1–*3) (emphasis added
`in brief).
`Petitioner contests Patent Owner’s position, arguing that the
`’813 patent is not directed to a technological invention and that the
`IBG case is inapplicable. Pet. Reply. 3–4. Petitioner first argues that
`CBM review is not available for “patents directed toward
`
`15
`
`
`
`CBM2018-00025
`Patent 8,577,813 B2
`
`‘technological inventions’ that either (1) claim subject matter that ‘as a
`whole recites a technological feature that is novel or unobvious over
`the prior art’ or (2) ‘solves a technical problem using a technical
`solution.’” Id. at 3 (quoting 37 C.F.R. § 42.401)5. According to
`Petitioner, the Board need not consider the second prong if, as here, the
`patent only recites technological features that were known or obvious.
`Id.; Tr. 11:1–17.
`Petitioner further contends Patent Owner misconstrues the
`record in an attempt to compare this case to the facts in IBG. Pet.
`Reply 3–4; Tr. 13–14. According to Petitioner, IBG is inapplicable
`here because the Board’s Decision Denying Institution in CBM2018-
`00026 was not a final decision, so therefore, our finding of CBM
`eligibility in the present case would not be “inconsistent with any final
`rulings.” Pet. Reply 4; Tr. 15:2–8. Petitioner is correct that the
`decision denying institution of a CBM review is not a Final Written
`Decision under 35 U.S.C. § 328(a). Nonetheless, we find our decision
`in CBM2018-00026 to be instructive because it analyzes, in detail, the
`nuances of the exact same challenged claims in relation to the statute
`and case law governing § 101 eligibility. And we specifically found in
`CBM2018-00026 that:
`[T]he claims are not directed to an abstract idea. A reading
`of the challenged claims reveals they require more than
`simply verifying an account holder’s identity based on
`codes or account holder information as alleged by
`Petitioner. Rather, we find that these claims are directed
`
`5 We understand this to be a typographical error and that Petitioner
`relies on Rule 42.301(b).
`
`16
`
`
`
`CBM2018-00025
`Patent 8,577,813 B2
`
`to an improvement in the security of mobile devices by
`using a biometric
`sensor, a user
`interface, a
`communication
`interface, and a processor working
`together to generate a time varying or other type of code
`that can be used for a single transaction, preventing the
`merchant from retaining identifying information that
`could be used fraudulently in subsequent transactions. See
`Ex. 1001, 52:1–29.
`Apple, Inc., v. Universal Secure Registry LLC, CBM2018-00026,
`Paper 11 at 22 (PTAB December 10, 2018) (Decision Denying
`Institution).
`[T]he claimed electronic ID device and method are limited
`to a particular technology using a biometric sensor, a user
`interface, a communication interface, and a processor,
`used in a specific order, each of which is narrowly
`configured to the claimed invention as an improvement to
`the technology. See Ex. 1001, 51:65–52:29.
`Id. at 23.
`[The] claims address a problem specific to the security of
`a remote device without preempting every device or
`method for authenticating a remote device payment
`transaction. Additionally, the claims here recite more than
`a mere result. Instead, they recite a specific arrangement
`of components or steps that accomplish the desired result.
`
`Id.
`
`Petitioner then contends that “no federal court has held—in final
`form—the ’813 patent to be [§ 101] eligible,” because Petitioner’s
`objection to a magistrate judge’s recommendation on this issue is
`pending currently before a district judge. Pet. Reply 4 (citing PO
`Resp. 20–23); Tr. 15:11–19. Again, the magistrate judge’s
`recommendations regarding § 101 eligibility (see Ex. 2017, 23–26)
`may not be a final determination, but they are instructive. Specifically,
`
`17
`
`
`
`CBM2018-00025
`Patent 8,577,813 B2
`
`the magistrate judge found the claims were not directed to an abstract
`idea because “the plain focus of the claims is on an improvement to
`computer functionality itself, not on economic or other tasks for which
`a computer is used in its ordinary capacity.” Ex. 2017, 23. The
`magistrate judge further found that “[t]he ’813 patent thus provides a
`series of claim elements operating together in a specific way to provide
`a more secure mobile transaction authentication system with both local
`and remote authentication, addressing a problem specific to the
`security of mobile dev
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