UNITED STATES PATENT AND TRADEMARK OFFICE
`________________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`________________
`
`APPLE INC.
`Petitioner,
`
`v.
`
`UNIVERSAL SECURE REGISTRY LLC
`Patent Owner
`________________
`
`Case CBM2018-00026
`U.S. Patent No. 8,577,813
`________________
`
`PATENT OWNER’S PRELIMINARY RESPONSE
`
`
`
`
`
`
`
`

`

`TABLE OF CONTENTS
`
`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`Page
`
`I.
`
`II.
`
`INTRODUCTION ........................................................................................... 1
`
`OVERVIEW OF THE ’813 PATENT ............................................................ 5
`
`A.
`
`B.
`
`C.
`
`The ’813 Patent Specification ............................................................... 5
`
`The ’813 Patent Claims ......................................................................... 8
`
`Prosecution History of the ’813 Patent ............................................... 11
`
`III. LEVEL OF ORDINARY SKILL IN THE ART ........................................... 11
`
`IV. CLAIM CONSTRUCTION .......................................................................... 12
`
`V.
`
`THE PETITION FAILS TO IDENTIFY RELATED MATTERS ............... 13
`
`VI. THE ’813 PATENT DOES NOT QUALIFY AS A “COVERED
`BUSINESS METHOD PATENT” ................................................................ 16
`
`A.
`
`Petitioner fails to show the ’813 patent does not claim a
`“technological invention.” ................................................................... 16
`
`B.
`
`The Claims Are Directed to a “Technological Invention” .................. 23
`
`1.
`
`The claimed subject matter as a whole recites
`technological features that are novel and unobvious over
`the prior art. ............................................................................... 23
`
`(a)
`
`(b)
`
`(c)
`
`Independent Claim 1 ....................................................... 24
`
`Independent Claim 16 ..................................................... 26
`
`Independent Claim 24 ..................................................... 28
`
`2.
`
`The claimed subject matter solves a technical problem
`with a technical solution. .......................................................... 30
`
`VII. THE CHALLENGED CLAIMS OF THE ’813 PATENT ARE
`DIRECTED TO PATENT-ELIGIBLE SUBJECT MATTER ...................... 34
`
`A.
`
`The Claims Are Not Directed to an Abstract Idea .............................. 37
`
`1.
`
`2.
`
`Petitioner’s Alice Step 1 analysis fails to properly
`address individual claim limitations and oversimplifies
`key inventive concepts found in the plain language of the
`claims. ....................................................................................... 37
`
`Petitioner fails to address the unique combination of
`elements of the claims. .............................................................. 44
`
`
`
`i
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`3.
`
`Petitioner’s Reliance on Secured Mail Solutions and
`Smart Systems Innovation is Improper and Inapplicable
`to the Present Claims. ............................................................... 46
`
`B.
`
`The Claims Provide a Technical Innovation That Transforms
`Any Purported Abstract Idea Into a Patent-Eligible Application ....... 49
`
`VIII. THE BOARD SHOULD STAY THE PRESENT PROCEEDING
`PURSUANT TO 37 C.F.R. § 42.122 ............................................................ 55
`
`IX. CONCLUSION .............................................................................................. 56
`
`CERTIFICATE OF COMPLIANCE ....................................................................... 57
`
`
`
`
`
`ii
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`TABLE OF AUTHORITIES
`
`Page
`
`CASES
`
`Alice Corp. Pty. Ltd. v. CLS Bank Int’l,
`134 S. Ct. 2347 (2014) ........................................................................... passim
`
`Apple, Inc. v. ContentGuard Holdings, Inc.,
`IPR2015-00356 (PTAB June 26, 2015) ......................................... 1, 2, 13, 14
`
`Bascom Glob. Internet Servs., Inc. v. AT&T Mobility, LLC,
`827 F.3d 1341 (Fed. Cir. 2016) .................................................. 50, 52, 53, 54
`
`Bilski v. Kappos,
`561 U.S. 593 (2010)................................................................................ 35, 44
`
`In re Bilski,
`545 F.3d 943 (Fed. Cir. 2008) .......................................................................50
`
`Bloomberg L.P. v. Quest Licensing Corporation,
`CBM2014-00205 (PTAB Apr. 7, 2015) ....................................................2, 21
`
`Cuozzo Speed Techs., LLC v. Lee,
`136 S. Ct. 2131 (2016) ...................................................................................12
`
`Diamond v. Diehr,
`450 U.S. 175 (1981).......................................................................................50
`
`Enfish, LLC v. Microsoft Corp.,
`822 F.3d 1327 (Fed. Cir. 2016) .............................................. 2, 19, 38, 43, 49
`
`E*Trade Fin. Corp. v. Droplets, Inc.,
`CBM2014-00123 (PTAB Oct. 30, 2014) ............................................... 17, 18
`
`Experian Mktg. Sol’ns, Inc. v. RPost Commc’ns Ltd.,
`CBM2014-00010 (PTAB Apr. 22, 2014) ............................................... 18, 21
`
`Finjan, Inc. v. Blue Coat Systems, Inc.,
`879 F.3d 1299 (Fed. Cir. 2018) .................................................. 19, 47, 48, 49
`
`Google LLC v. UNILOC Luxembourg S.A.,
`Case No. 2017-02067 (PTAB March 29, 2018) ........................................4, 55
`
`Idexx Labs., Inc. v. Charles River Labs., Inc.,
`2016 WL 3647971 (D. Del. Jul. 1, 2016) ......................................................44
`
`King Pharms., Inc. v. Eon Labs, Inc.,
`616 F.3d 1267 (Fed. Cir. 2010) .....................................................................50
`
`
`
`iii
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`Mayo Collaborative Services v. Prometheus Labs., Inc.,
`132 S. Ct. 1289 (2012) ...................................................................................35
`
`McRO, Inc. v. Bandai Namco Games Am. Inc.,
`837 F.3d 1299 (Fed. Cir. 2016) ........................................................ 38, 43, 44
`
`Research Corp. Techs., Inc. v. Microsoft Corp.,
`627 F.3d 859 (Fed. Cir. 2010) .......................................................................37
`
`SAS Institute, Inc. v. Iancu,
`138 S. Ct. 1348 (2018) ...................................................................................35
`
`Secured Mail Sols. v. Universal Wilde,
`873 F.3d 905 (Fed. Cir. 2017) ................................................................ 46, 50
`
`Smart Meter Techs., Inc. v. Duke Energy Corp.,
`2017 WL 2954916 (D. Del. July 11, 2017) ...................................................45
`
`Smart Sys. Innovations, LLC v. Chi. Transit Auth.,
`873 F.3d 1364 (Fed. Cir. 2017) .............................................................. 46, 47
`
`Unified Patents, Inc. v. Universal Secure Registry LLC,
`Case No. IPR2018-00067 (PTAB October 16, 2017) .............. 1, 4, 14, 55, 56
`
`Universal Secure Registry LLC v. Apple Inc. et, al.,
`No. 17-585-VAC-MPT (D. Del.) (complaint served July 5, 2017) ..............14
`
`STATUTORY AUTHORITIES
`
`35 U.S.C. § 101 ................................................................................................ passim
`
`35 U.S.C. § 324(a) ...............................................................................................3, 34
`
`37 C.F.R. § 42.8(a) ...............................................................................................1, 13
`
`37 C.F.R. § 42.8(b)(2) ..............................................................................................13
`
`37 C.F.R. § 42.122 ...............................................................................................4, 55
`
`37 C.F.R. § 42.300(b) ..............................................................................................12
`
`37 C.F.R. § 42.301 ............................................................................................ 16, 21
`
`37 C.F.R. § 42.301(a) ................................................................................................. 2
`
`37 C.F.R. § 42.301(b) ............................................................................. 2, 17, 20, 23
`
`37 C.F.R. § 42.304(a) ...............................................................................................16
`
`AIA § 18(a)(1) .........................................................................................................16
`
`AIA § 18(d)(1) .............................................................................................. 2, 16, 23
`
`
`
`iv
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`OTHER AUTHORITIES
`
`157 Con. Rec. S5402 (daily ed. September 8, 2011) (statement of Sen Kyl) .........19
`
`
`
`
`
`
`
`v
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`TABLE OF EXHIBITS
`
`Exhibit No. Description
`
`2001
`
`2002
`
`2003
`
`2004
`
`Declaration of Dr. Markus Jakobsson, Ph.D.
`
`Letter from Jason J. Rawnsley, counsel for Petitioner Apple, Inc.
`
`Public PAIR Entry for U.S. Patent 8,577,813.
`
`Curriculum Vitae of Dr. Markus Jakobsson, Ph.D.
`
`
`
`
`
`vi
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`I.
`
`INTRODUCTION
`
`The present petition (Paper No. 3, CBM2018-00026, hereinafter “Petition”)
`
`is one of three petitions filed by Apple Inc. (“Petitioner”) challenging various claims
`
`of U.S. Patent No. 8,577,813 (“the ’813 patent”). See also CBM2018-00024,
`
`CBM2018-00025. The Petition requests Covered Business Method (CBM) review
`
`of the ’813 patent and asserts that claims 1-26 (“Challenged Claims”) are
`
`unpatentable under 35 U.S.C. § 101. See Petition at 1, 32-33. Patent Owner disagrees
`
`and submits this Preliminary Response to the Petition requesting that the Board deny
`
`the Petition and not institute CBM review of the ’813 patent for at least the following
`
`reasons.
`
`First, the Board should deny the Petition because the Petition fails to identify
`
`the “related matter” Unified Patents, Inc. v. Universal Secure Registry LLC, Case
`
`No. IPR2018-00067 (“the ’067 proceeding”), which is an IPR proceeding involving
`
`the ’813 patent. Petitioner must include certain mandatory notices with its petition
`
`(37 C.F.R. § 42.8(a)), and failure to comply with this requirement can be grounds
`
`for denial of a petition. See Apple, Inc. v. ContentGuard Holdings, Inc., IPR2015-
`
`00356, slip op. at 8 (PTAB June 26, 2015) (Paper 9). Given that claim constructions
`
`submitted in the ’067 proceeding may affect the construction of the same ’813 patent
`
`claims at issue in the present proceeding, Petitioner’s failure to notify the Board of
`
`
`
`1
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`the co-pending, related matter is especially egregious and counsels denial of the
`
`Petition. See id. at 7-8.
`
`Second, the ’813 patent is not eligible for CBM review because Petitioner fails
`
`to meet its burden of showing that the ’813 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 ’813 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. 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 fatal
`
`flaws 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 ’813 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 the identity of a user of an electronic device and/or
`
`authenticate the electronic device itself for use in a distributed electronic transaction
`
`
`
`2
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`involving a “point-of-sale” device without compromising the user’s sensitive
`
`information. For this reason as well, the ’813 patent is not a CBM patent, and the
`
`Petition should be denied.
`
`Third, although the Board should not reach the defective Petition’s asserted
`
`invalidity ground, Petitioner also fails to meet its burden of showing that any
`
`Challenged Claim of the ’813 patent is “more likely than not” (35 U.S.C. § 324(a))
`
`unpatentable under 35 U.S.C. § 101. The Petition sets forth only a 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, 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 ’813 patent
`
`presents no risk of preemption because the claimed inventions are directed not to a
`
`fundamental or long-prevalent practice, but to a specific, concrete, technological
`
`solution providing an electronic identification (ID) device or methods associated
`
`with an electronic ID device that perform user identity authentication locally at the
`
`electronic ID device and/or generate cryptographic information for remote
`
`authentication of the device by a secure registry to enable or deny a transaction
`
`involving the device and a point-of-sale device. This technology allows for secure
`
`distributed transaction enablement involving a point-of-sale device without
`
`
`
`3
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`compromising a user’s sensitive information. As a result, the ’813 patent is directed
`
`to patent-eligible subject matter under 35 U.S.C. § 101.
`
`Separately, the Board has discretion to stay the present proceeding under 37
`
`C.F.R. § 42.122. See Google LLC v. UNILOC Luxembourg S.A., Case No. 2017-
`
`02067, slip op. at 8-9 (PTAB March 29, 2018) (Paper 10). The ’813 patent is the
`
`subject of the ’067 IPR proceeding, which is in its advanced stages (instituted on
`
`May 2, 2018, and oral argument scheduled for January 30, 2019). See IPR2018-
`
`00067, Paper 21 at 3 (scheduling order). Patent Owner has also filed its Patent
`
`Owner Response and Motion to Amend in that proceeding, and briefing on these
`
`papers will be completed in November 2018, long before a decision on institution is
`
`reached in this matter. See id. Moving forward on the instant Petition would result
`
`in the Board and the parties wasting significant resources. For example, if the Board
`
`were to find the claims of the ’813 patent invalid in the ’067 proceeding, there is a
`
`real possibility that amended claims will issue, rendering this instant Petition moot.
`
`For this reason the Board should at the very least stay the present proceedings until
`
`a judgment is rendered in the ’067 proceeding.
`
`Accordingly, the Board should deny the Petition because the ’813 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 ’813 patent is directed to
`
`unpatentable subject matter.
`
`
`
`4
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`II. OVERVIEW OF THE ’813 PATENT
`
`A. The ’813 Patent Specification
`
`The ’813 patent provides improved devices and methods that allow users to
`
`securely authenticate their identity and authenticate their electronic ID device when
`
`engaging in a distributed electronic transaction involving a point-of-sale device. Ex.
`
`1001, ’813 Patent at FIG. 31, 43:4-51:55. When used in conjunction with the patent’s
`
`Universal Secure Registry (“USR”), the claimed electronic ID device can both
`
`securely identify the user, and separately authenticate and approve the user’s
`
`financial transaction requests made through a point-of-sale device. Id. at 43:4-15,
`
`FIG. 31. One non-exclusive, non-limiting example of such a system is shown in FIG.
`
`31 below, which includes the electronic ID device 352, the point-of-sale device 354,
`
`and the USR 356. The USR in this embodiment includes a secure database that stores
`
`account (e.g., credit card) information for a plurality of users. Id. at 44:39-53.
`
`
`
`5
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`
`
`The ’813 patent specification identifies a number of disadvantages of prior art
`
`approaches to providing secure access. For example, a prior art authorization system
`
`may control access to computer networks using password protected accounts, but
`
`such a system is susceptible to tampering and difficult to maintain. See id. at 1:64-
`
`2:15. Moreover, prior art hand-held computer devices may be used to verify identity,
`
`but security could be compromised if the device ends up in the wrong hands. See id.
`
`at 2:16-43.
`
`To prevent unauthorized use of the claimed electronic ID device, a user must
`
`authenticate themselves to the device to activate it for a transaction. The ’813 patent
`
`
`
`6
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`describes multiple ways to do this, including using a biometric input (e.g.,
`
`fingerprint) and/or secret information (e.g., a PIN). Id. at 45:55-46:45, 50:1-22, 51:7-
`
`26. Once activated, the electronic ID device allows a user to select an account for a
`
`transaction, such as a financial transaction, and generates encrypted authentication
`
`information that is sent via the point-of-sale device to the USR for authentication
`
`and approval of the requested financial transaction. Id. at 46:22-36. Notably, this
`
`encrypted authentication information is not the user’s credit card information or
`
`other sensitive user information, which could be intercepted and misused. See id. at
`
`4:14-20 (“Additionally, the system may enable the user’s identity to be confirmed
`
`or verified without providing any identifying information about the person to the
`
`entity requiring identification. This can be advantageous where the person suspects
`
`that providing identifying information may subject the identifying information to
`
`usurpation.”). Instead, the electronic ID device may first generate a non-predictable
`
`value, and then generates single-use authentication information from the non-
`
`predictable value, information associated with the biometric data, and the secret
`
`information. Id. at 46:14-36, 50:56-65. This encrypted authentication information is
`
`transmitted to the secure registry, where it may be used, for example, to authenticate
`
`the electronic ID device or to determine transaction approval. Id. at 11:36-45, 12:19-
`
`44, 12:64-13:8, 48:60-49:24, 50:23-32, 51:7-26.
`
`
`
`7
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`B.
`
`The ’813 Patent Claims
`
`The ’813 patent includes 26 claims, of which independent claims 1, 16, and
`
`24 are 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:
`
`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,
`
`
`
`8
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`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. 1001 at 51:65-52:29.
`
`
`16. A method of generating authentication information
`
`comprising acts of:
`
`authenticating an identity of a user to an electronic ID device
`
`based on at least one of biometric data received by the electronic ID
`
`device from the user and secret information known to the user and
`
`provided to the electronic ID device;
`
`activating the electronic ID device based on successful
`
`authentication;
`
`generating, responsive to activating, a non-predictable value with
`
`the electronic ID device;
`
`receiving, in a user interface, identifying information from the
`
`user concerning a selected one of a plurality of user accounts;
`
`generating encrypted authentication information from the non-
`
`predictable value, information associated with at least a portion of the
`
`biometric data, and the secret information; and
`
`communicating, by a communication interface, the encrypted
`
`authentication information from the electronic ID device to a secure
`
`
`
`9
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`registry via a point-of-sale (POS) device to authenticate the electronic
`
`ID device with the secure registry.
`
`Id. at 53:25-47.
`
`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 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;
`
`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; 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.
`
`
`
`10
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`C.
`
`Prosecution History of the ’813 Patent
`
`The ’813 patent issued on November 5, 2013 from U.S. Application
`
`No. 13/237,184 (“’184 Application”) filed on September 20, 2011. The ’729
`
`Application claims the benefits of multiple patents and patent applications the
`
`earliest of which, U.S. Provisional application no. 60/775,046, has a filing date of
`
`Feb. 21, 2006.
`
`The ’184 Application was subject to a thorough examination by Examiner
`
`Calvin Cheung. See Exs. 1007-1012. During prosecution, the Applicant and the
`
`Examiners discussed the application and prior art in detail, both through paper
`
`submissions and telephonic interviews. See Exs. 1007-1011. Ultimately, Examiner
`
`Cheung allowed the ’184 Application (Ex. 1012 at 5-9) over a large body of cited
`
`prior art. See Ex. 1001 at 2-3. Examiner Cheung indicated that he allowed the claims
`
`of the ’184 Application 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.
`
`1012 at 6-9.
`
`
`
`III. LEVEL OF ORDINARY SKILL IN THE ART
`
`A person of ordinary skill in the art relevant to the ’813 patent at the time of
`
`the invention would have a Bachelor of Science degree in electrical engineering
`
`
`
`11
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`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. See Ex. 2001, Jakobsson at ¶ 16. Patent Owner’s description of the level of
`
`ordinary skill in the art is similar to that of the Petitioner, but requires further and
`
`more specialized education and/or experience with the complex technology of
`
`the ’813 patent. See Petition at 21. The positions set forth in this Preliminary
`
`Response would be the same under either parties’ proposal. See Ex. 2001, Jakobsson
`
`at ¶ 17.
`
`
`
`IV. CLAIM CONSTRUCTION
`
`Claim terms in a CBM 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 five terms that purportedly require construction. Petition
`
`at 33-42. Patent Owner contends construction of these five terms is not necessary to
`
`resolve the matters raised by this Preliminary Response. Although Patent Owner has
`
`not addressed in this Preliminary Response the propriety of the Petition’s proffered
`
`constructions, that decision should not be construed as Patent Owner’s acceptance
`
`of any of these constructions, and as such Patent Owner reserves the right to later
`
`
`
`12
`
`

`

`dispute any or all of these constructions, and to offer its own constructions for these
`
`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`terms, as appropriate.
`
`
`
`V. THE PETITION FAILS TO IDENTIFY RELATED MATTERS
`
`A Petitioner must include certain mandatory notices with its petition. 37
`
`C.F.R. § 42.8(a) (“Each notice listed in paragraph (b) of this section must be filed
`
`with the Board”) (emphasis added). The mandatory notices include a requirement to
`
`“[i]dentify any other judicial or administrative matter that would affect, or be
`
`affected by, a decision in the proceeding.” 37 C.F.R. § 42.8(b)(2) (titled “Related
`
`Matters”) (emphasis added). The Board has held “Related Matters” to include inter
`
`partes reviews involving patents belonging to a patent owner that affect the
`
`constructions of the claims of the patent-at-issue. See Apple, Inc. v. ContentGuard
`
`Holdings, Inc., IPR2015-00356, slip op. at 7 (PTAB June 26, 2015) (Paper 9)
`
`(“Petitioner’s declarant…cites several PTAB decisions involving patents belonging
`
`to Patent Owner, as affecting the constructions of the claims of the [patent-at-issue].
`
`Yet, the Petition does not identify, as related matters, the inter partes reviews in
`
`
`
`13
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`which those decisions were rendered.”).1 Failure to comply with this requirement
`
`can be grounds for denial of a petition. Id. at 8.
`
`Here, the Petition identifies four Related Matters that directly involve the ’813
`
`patent: Universal Secure Registry LLC v. Apple Inc. et, al., No. 17-585-VAC-MPT
`
`(D. Del.) (complaint served July 5, 2017), and three CBM petitions “Apple is filing.”
`
`Petition at 2-4. These three CBM petitions include the one at bar, along with
`
`CBM2018-00024 (alleging obviousness based on combinations of Maes and
`
`Jakobsson) and CBM2018-00025 (alleging obviousness based on combinations of
`
`Jakobsson in view of Maritzen). However, the Petition fails to identify Unified
`
`Patents, Inc. v. Universal Secure Registry LLC, Case No. IPR2018-00067 which
`
`is an IPR proceeding involving the ’813 patent. Petitioner either knew of or
`
`reasonably should have known of the ’067 proceeding at the time it filed this Petition
`
`on May 3, 2018, as evidenced by a letter dated May 22, 2018 sent by its counsel,
`
`Jason J. Rawnsley, to Honorable Sherry R. Fallon, the magistrate judge presiding
`
`over the corresponding district court litigation, informing the Court of the ’067
`
`
`1 To Patent Owner’s knowledge, Petitioner Apple, Inc.’s present failure to
`
`identify IPR2018-00067 as a related matter is at least the second time this Petitioner
`
`has failed to properly cite a complete listing of related matters in an IPR proceeding,
`
`the IPR2015-00356 proceeding being the first.
`
`
`
`14
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`proceeding and promising to “keep the Court apprised of activity in the U.S. Patent
`
`& Trademark Office related to this litigation.” Ex. 2002, Letter from Jason J.
`
`Rawnsley. It is also reasonable to conclude that Petitioner was aware of the ’067
`
`proceeding because conducting even the most basic due diligence for the ’813 patent
`
`using the USPTO’s Public Patent Application Information Retrieval (PAIR) system
`
`(See Ex. 2003, Public PAIR Entry for U.S. Patent 8,577,813 at 1 (showing Image
`
`File Wrapper of the ’813 patent having a “TRIAL.REQ.G” entry dated May 2,
`
`2018)) and/or PTAB’s End to End (E2E) electronic system would have revealed the
`
`’067 proceeding. Failure to disclose the ’067 proceeding counsel against institution.
`
`Specifically, Unified Patents initiated the ’067 proceeding by filing a petition
`
`on October 16, 2017—about seven months prior to Apple filing the instant Petition
`
`on May 3, 2018. See IPR2018-00067, Paper 2. The Board instituted the ’067
`
`proceeding on May 2, 2018—the day before Apple filed the Petition here. See ’067
`
`proceeding, Paper 14 (trial institution decision). Critically, the two proceedings
`
`propose different claim constructions for terms in the ’813 patent. Compare Petition
`
`at 33-42 with IPR2018-00067, Paper 12 at 5-7. As such, the ’067 proceeding is an
`
`“administrative matter that would affect, or be affected by, a decision in the
`
`proceeding,” and should have been disclosed.
`
`Accordingly, Petitioner’s disregard of the mandatory notice counsels denial
`
`of institution.
`
`
`
`15
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`
`
`VI. THE ’813 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 the claimed invention
`
`is not technological in nature. Thus, the ’813 patent fails to meet the statutory test
`
`for CBM eligibility, and the Petition should be denied without consideration of the
`
`asserted invalidity grounds.
`
`A.
`
`Petitioner fails to show the ’813 patent does not claim a
`“technological invention.”
`
`Petitioner’s contention that the ’813 patent is not directed to a technological
`
`invention is defective because the Petition fails to show that the subject matter
`
`claimed in the ’813 patent, as a whole, is not “novel and unobvious over the prior
`
`art” or that it fails to “solve a technical problem using a technical solution” as is
`
`
`
`16
`
`

`

`Case No. CBM2018-00026
`U.S. Patent No. 8,577,813
`
`required by 37 C.F.R. § 42.301(b). Petitioner fails to satisfy its burden of proof to
`
`establish standing under 37 C.F.R. § 42.301(b) because:
`
`(1) Petitioner fails to analyze the claims’ limitations in detail and merely
`
`makes conclusory