Trials@uspto.gov
`571–272–7822
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` Paper 7
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` Entered: September 4, 2014
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`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`MASTERCARD INTERNATIONAL INCORPORATED,
`Petitioner,
`
`v.
`
`JOHN D’AGOSTINO,
`Patent Owner.
`
`
`Case IPR2014–00544
`Patent 7,840,486
`
`
`
`Before SALLY C. MEDLEY, KARL D. EASTHOM, and
`KALYAN K. DESHPANDE, Administrative Patent Judges.
`
`DESHPANDE, Administrative Patent Judge.
`
`
`DECISION
`Institution of Inter Partes Review
`37 C.F.R. § 42.108
`
`
`
`
`
`

`

`Case IPR2014–00544
`Patent No. 7,840,486
`
`
`I.
`INTRODUCTION
`MasterCard International Incorporated (“Petitioner”) filed a corrected
`Petition requesting an inter partes review of claims 1–30 of
`U.S. Patent No. 7,840,486 (Ex. 1001, “the ’486 patent”). Paper 1 (“Pet.”).
`John D’Agostino (“Patent Owner”) timely filed a Preliminary Response. Paper 6
`(“Prelim. Resp.”). We have jurisdiction under 35 U.S.C. § 314, which provides
`that an inter partes review may not be instituted “unless . . . there is a reasonable
`likelihood that petitioner would prevail with respect to at least 1 of the claims
`challenged in the petition.” 35 U.S.C. § 314.
`Upon consideration of the Petition and the Preliminary Response, we
`determine that Petitioner has established that there is a reasonable likelihood that
`Petitioner would prevail in showing the unpatentability of claims 1–30 of the ’486
`patent. Accordingly, we institute an inter partes review of these claims.
`A. Related Proceedings
`Petitioner identifies the following related district court proceeding involving
`the ’486 patent and in which Petitioner is a party: D’Agostino v. MasterCard, Inc.,
`Case No. 1:13–cv–00738 (D. Del. filed Apr. 26, 2013). Pet. 58.
`In related proceeding IPR2014–00543, Petitioner seeks review of U.S.
`Patent No. 8,036,988 (“the ’988 patent”), which claims priority to the ’486 patent.
`Pet. 58. Petitioner also identify the ’988 patent as the subject of Ex Parte
`Reexamination proceeding No. 90/012,517. Id. at 6–13.
`Petitioner previously sought a covered business method patent review of the
`’486 patent in proceeding CBM2013–00058, but we had denied institution of
`review. Id. at 13–14; Mastercard Int’l Inc. v. D’Agostino, case CBM2013–00058
`(PTAB Mar. 7, 2014)(Paper 10). Specifically, we had denied institution of review
`because Petitioner had not demonstrated that Cohen or Flitcroft qualifies as prior
`
`
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`2
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`Case IPR2014–00544
`Patent No. 7,840,486
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`art under Section 18(a)(1)(C) of the AIA, because neither Cohen nor Flitcroft was
`published prior to the effective filing date of the ’486 patent. Mastercard Int’l Inc.
`v. D’Agostino, case CBM2013–00058, slip op. at 8-9 (PTAB Mar. 7, 2014).
`B. The ’486 Patent
`The ’486 patent discloses a method and system of performing secure credit
`card purchases. Ex. 1001, Abstract. The method and system increase overall
`security by minimizing access to credit card numbers, without having to
`substantially deviate from existing credit card transaction practices. Id. at 1:13–23.
`Figure 3 of the ’486 patent follows:
`
`
`Figure 3, depicted above, schematically represents a secure credit card
`transaction system, where the customer–to–merchant contact is by phone or in
`person. As shown above in Figure 3, customer 54 receives promotional
`information from merchant 56, either by telephone 60 or in person 62. Ex. 1001,
`7:25–30. Customer 54 then contacts custodial authorizing entity 64, by either
`telephone 66’ or computer 45’, for authorization. Id. at 7:30–38. After confirming
`authorization, authorizing entity 64 establishes details of the anticipated transaction
`3
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`Case IPR2014–00544
`Patent No. 7,840,486
`
`to determine a payment category, and then issues a transaction code to the
`customer. Id. at 7:38–41. The customer can utilize the transaction code to
`consummate a transaction within the defined parameters of the payment category,
`and the merchant can obtain verification and subsequent payment utilizing the
`transaction code only. Id. at 7:41–50.
`C. Illustrative Claim
`Petitioner challenges claims 1–30 of the ’486 patent. Pet. 17–58. Claim 1 is
`illustrative of the claims at issue and is reproduced below:
`1.
`A method of performing secure credit card purchases, said
`method comprising:
`a) contacting a custodial authorizing entity having custodial
`responsibility of account parameters of a customer’s account that is
`used to make credit card purchases;
`b) supplying said custodial authorizing entity with at least
`account identification data of said customer’s account;
`c) defining a payment category including at least limiting
`purchases to a single merchant for at least one transaction, said single
`merchant limitation being included in said payment category prior to
`any particular merchant being identified as said single merchant;
`d) designating said payment category thereby designating at
`least that transaction code generated in accordance with said payment
`category can be used by only one merchant;
`e) generating a transaction code by a processing computer of
`said custodial authorizing entity, said transaction code reflecting at
`least the limits of said designated payment category to make a
`purchase within said designated payment category;
`f) communicating said transaction code to a merchant to
`consummate a purchase with defined purchase parameters;
`g) verifying that said defined purchase parameters are within
`said designated payment category; and
`h) providing authorization for said purchase so as to confirm at
`least that said defined purchase parameters are within said designated
`payment category and to authorize payment required to complete the
`purchase.
`
`
`
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`Case IPR2014–00544
`Patent No. 7,840,486
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`
`D. The Alleged Grounds of Unpatentability
`The information presented in the Petition sets forth proposed grounds of
`unpatentability of claims 1–30 of the ’486 patent under 35 U.S.C. §§ 102, 103 as
`follows (see Pet. 17–58):
`
`Reference(s)
`
`Basis
`
`Challenged Claims
`
`Cohen1
`Cohen and
`Musmanno2
`Flitcroft3
`Flitcroft and
`Musmanno
`
`Cohen
`
`Flitcroft
`
`§ 102(e)
`
`1–15 and 22–30
`
`§ 103
`
`16–21
`
`§ 102(e)
`
`1–15 and 22–30
`
`§ 103
`
`§ 103
`
`§ 103
`
`16–21
`
`1–15 and 22–30
`
`1–15 and 22–30
`
`II. ANALYSIS
`A. Claim Construction
`In an inter partes review, claim terms in an unexpired patent are interpreted
`according to their broadest reasonable construction in light of the specification of
`the patent in which they appear. 37 C.F.R. § 42.100(b); Office Patent Trial
`Practice Guide, 77 Fed. Reg. 48,756, 48,764-66 (Aug. 14, 2012). Claim terms are
`given their ordinary and customary meaning, as would be understood by one of
`ordinary skill in the art in the context of the entire disclosure. In re Translogic
`Tech., Inc., 504 F.3d 1249, 1257 (Fed. Cir. 2007). A claim term will not be given
`
`1 US Patent No. 6,422,462 B1 (Ex. 1004) (“Cohen”).
`2 US Patent No. 5,826,243 (Ex. 1006) (“Musmanno”).
`3 US Patent No. 6,636,833 B1 (Ex. 1005) (“Flitcroft”).
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`Case IPR2014–00544
`Patent No. 7,840,486
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`its ordinary and customary meaning, however, when an inventor acts as his or her
`own lexicographer, defining the term in the specification with reasonable clarity,
`deliberateness, and precision. Renishaw PLC v. Marposs Societa’ per Azioni, 158
`F.3d 1243, 1249 (Fed. Cir. 1998).
`1.
`“generating a transaction code”
`Independent claims 1, 24, 25, and 30 recite “generating a transaction code.”
`Petitioner proposes this limitation means “‘creating a code usable as a substitute
`for a credit card number in a purchase transaction, the number pre–coded to be
`indicative of a specific credit card account.’” Pet. 15. Patent Owner proposes the
`limitation means “producing a code that is usable in substitution for a credit card
`number in a purchase transaction, the code being indicative of a customer account
`and a payment category.” Prelim. Resp. 4–5. The ’486 patent specification
`discloses that “the transaction code is pre–coded to be indicative of a specific
`credit card account.” Ex. 1001, 6:28–29. The ’486 patent, however, does not
`define specifically “generating a transaction code” to include a payment category,
`as argued by Patent Owner; rather, the specification explicitly states that a
`designated payment category is preferable. See Prelim. Resp. 4–5; Ex. 1001, 6:29,
`30. Accordingly, we construe “generating a transaction code,” under the broadest
`reasonable construction, to mean “creating [or producing] a code [that is] usable as
`a substitute for a credit card number in a purchase transaction, the [transaction
`code is] pre–coded to be indicative of a specific credit card account,” as argued by
`both Petitioner and Patent Owner. Pet. 15.
`2.
`“defining at least one payment category”
`Independent claim 1 recites “defining at least one payment category.”
`Claim 1 further recites the payment category includes “limiting a number of
`transactions to one or more merchants” and “said one or more merchants limitation
`
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`Case IPR2014–00544
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`being included in said payment category prior to any particular merchant being
`identified as one of said one or more merchants.” Independent claims 24, 25, and
`30 recite similar limitations. Petitioner argues that “defining [at least one] payment
`category” means “specifying the type of limitation (or limitations) that are
`available to be applied to a transaction code in order to limit its use.” Pet. 15.
`Patent Owner does not propose a definition for this limitation.
`Although the ’486 patent provides several examples of types of payment
`categories, the ’486 patent does not specifically define “defining at least one
`payment category.” For example, the ’486 patent describes that payment
`categories include “a single transaction involving a specific dollar amount for a
`purchase within a specific time period” or “a single transaction . . . [with] a
`maximum limit or a dollar amount.” Ex. 1001, 3:51–59. Accordingly, under the
`broadest reasonable interpretation, we agree with Petitioner that this limitation
`means “specifying the type of limitation (or limitations) that are available to be
`applied to a transaction code in order to limit its use.” Pet. 15.
`3. “single merchant limitation being included in said payment category prior to
`any particular merchant being identified as a single merchant”
`Independent claims 1, 24, 25, and 29 recite “single merchant limitation
`being included in said payment category prior to any particular merchant being
`identified as a single merchant.” Petitioner proposes “prior to any particular
`merchant being identified,” as recited in each of these limitations, means “prior to
`the identification of a particular merchant for the particular transaction(s) or
`purchase(s) in said payment category.” Pet. 16. Patent Owner argues that “single
`merchant limitation being included in said payment category prior to any particular
`merchant being identified as a single merchant.” means “including a limit in a
`payment category that limits transactions to one or more merchants before any
`particular merchant is identified as the one or more merchants.” Prelim. Resp. 5–6.
`7
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`Case IPR2014–00544
`Patent No. 7,840,486
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`
`The ’486 patent describes that a merchant or merchants can be identified
`prior to the generation of the transaction code, such that the transaction code is
`pre–coded with the merchant’s or merchants’ identification. Ex. 1001, 6:27–32.
`Subsequently, a customer can disclose the transaction code to a merchant or
`merchants. Id. at 6:58–63. We interpret the merchant to whom the customer
`discloses the transaction code as the recited “particular merchant.” In other words,
`the merchant with whom the customer is transacting is the particular merchant.
`We further interpret, under the broadest reasonable interpretation, the “single
`merchant limitation” means any group, category, or type of merchant, where the
`“particular merchant” is a subset of the “single merchant limitation.” As such, the
`limitation “single merchant limitation being included in said payment category
`prior to any particular merchant being identified as a single merchant” means any
`group, category, or type of merchant is included in the payment category prior to
`the customer selecting a particular merchant for a transaction.
`B. Claims 1–15 and 22–30 – Anticipation by Cohen
`Petitioner contends that claims 1–15 and 22–30 are unpatentable under 35
`U.S.C. § 102(e) as anticipated by Cohen. Pet. 17–31.
`1. Cohen (Ex. 1004)
`Cohen describes a system of disposable credit card numbers, where the
`credit card numbers are generated for a one–time, single transaction basis, after
`which they are disposed of, or thrown away. Ex. 1004, 2:34–37. In general, a user
`dials into her credit card company and provides the ordinary credit card number
`and verification data, and may further indicate the transaction for which the
`customized credit card number will be used. Id. at 3:41–53. The user then is
`provided with a disposable or customized credit card number for a single or limited
`range use. Id.
`
`
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`Case IPR2014–00544
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`
`For example, an employee’s credit card may be authorized to purchase a
`computer system, thereby transforming the credit card to a customized credit card
`that is valid for only that particular type of purchase. Ex. 1004, 8:24–35. The card
`also can be customized for use in a particular store or a particular chain of stores.
`Id.
`
`2. Analysis
`The evidence set forth by Petitioner indicates there is a reasonable likelihood
`that Petitioner would prevail in showing that claims 1–10, 15–25, 27–33, and 35–
`38 are unpatentable under 35 U.S.C. § 102(e) as anticipated by Cohen. Pet. 17–31.
`For example, independent claim 1 recites a “method of performing secure credit
`card purchases.” Petitioner argues that Cohen discloses “provid[ing] improved
`credit cards and methods for credit card transactions . . . provid[ing] methods and
`apparatus for secure transmission of credit card information.” Pet. 18 (quoting Ex.
`1004, 1:48–62). Claim 1 further recites the following:
`a) contacting a custodial authorizing entity having custodial
`responsibility of account parameters of a customer’s account that is
`used to make credit card purchases;
`b) supplying said custodial authorizing entity with at least account
`identification data of said customer’s account; . . .
`d) designating said payment category thereby designating at least that
`transaction code generated in accordance with said payment category
`can be used by only one merchant;
`e) generating a transaction code by a processing computer of said
`custodial authorizing entity, said transaction code reflecting at least
`the limits of said designated payment category to make a purchase
`within said designated payment category.
`Petitioner argues that Cohen describes that after an account holder contacts her
`credit card company that verifies her identity, the account holder is provided with a
`transaction code number to be used for a single or limited range of transactions or
`to be used at a particular store itself, where the transactions can be indicated in
`
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`Case IPR2014–00544
`Patent No. 7,840,486
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`advance of receiving the transaction code number. Pet. 18–20 (citing Ex. 1004,
`2:35–43, 3:28–52, 8:25–46). Claim 1 further recites:
`c) defining a payment category including at least limiting purchases
`to a single merchant for at least one transaction, said single merchant
`limitation being included in said payment category prior to any
`particular merchant being identified as said single merchant.
`Petitioner argues that Cohen discloses that “[t]he card can also be
`customized for particular uses or groups of uses” and further discloses that
`the card can be valid for a particular type of charge, such as computer
`hardware or software stores, or a particular store or a particular chain of
`stores. Id. at 19 (citing Ex. 1004, 2:35–43, 7:66–67, 8:25–46, 12:3–4).
`Petitioner specifically argues that Cohen discloses that the card can be valid
`for only a particular chain of restaurants or a type of store, such as a clothing
`store. Id. Based on our construction of this limitation above, we are
`persuaded Petitioner has made a sufficient showing that Cohen describes this
`limitation. Claim 1 also recites:
`f) communicating said transaction code to a merchant to consummate
`a purchase with defined purchase parameters;
`g) verifying that said defined purchase parameters are within said
`designated payment category; and
`h) providing authorization for said purchase so as to confirm at least
`that said defined purchase parameters are within said designated
`payment category and to authorize payment required to complete the
`purchase.
`Petitioner argues Cohen discloses that a user communicates the disposable credit
`card number to a vendor, and the vendor verifies the transaction and obtains an
`authorization code from the credit card company authorizing the purchase. Id. at
`20–21 (citing Ex. 1004, 5:36–49, 7:66–8:2). We are persuaded by Petitioner’s
`arguments.
`
`
`
`10
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`Case IPR2014–00544
`Patent No. 7,840,486
`
`Patent Owner argues that the Petition impermissibly combines separate,
`
`distinct embodiments of Cohen to satisfy independent claim 1. Prelim. Resp. 18–
`20. Patent Owner specifically argues that these separate and distinct embodiments
`of Cohen are delineated by the phrases “[i]n one embodiment” and “[i]n
`accordance with the present invention, in one embodiment of the present
`invention.” Id. at 19. Patent Owner further argues that
`Mastercard relies on several custom-use credit card embodiments of
`Cohen to teach that a transaction code can be customized for certain
`uses. And then relies on separate single-use credit card of Cohen to
`allegedly show that a single-use credit card inherently teaches limiting
`a transaction code to a single merchant without first identifying the
`single merchant.
`Id. at 19–20.
`We are not persuaded by this argument. As discussed in the Petition, Cohen
`discloses a single-use credit card and Cohen further discloses that the credit card
`can be customized with other limits, including limiting use to a certain store or
`single merchant. Pet. 19 (citing Ex. 1004, 8:42–46). The Petition relies on
`Cohen’s disclosure of a “certain store” to describe a “single merchant.” See id. As
`such, Patent Owner’s argument does not rebut Petitioner’s challenge of
`unpatentability of claim 1. Furthermore, Patent Owner fails to specifically identify
`the “multiple distinct embodiments” relied upon by the Petition. Patent Owner
`only sets forth the conclusory argument that Cohen discloses “[i]n one embodiment
`” and “[i]n accordance with the present invention, in one embodiment of the
`present invention ” without specifically identifying the distinct features of each
`embodiment and the Petition’s impermissible reliance on the combination of these
`embodiments. Prelim. Resp. 18-19. Accordingly, we are not persuaded by Patent
`Owner’s argument.
`
`
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`Case IPR2014–00544
`Patent No. 7,840,486
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`In addition, Patent Owner argues that Cohen fails to disclose limiting
`
`“purchases to a single merchant for at least one transaction, said single merchant
`limitation being included in said payment category prior to any particular merchant
`being identified as said single merchant,” as recited in independent claim 1 and as
`similarly recited in independent claims 24, 25, and 29. Prelim. Resp. 20–22
`(citation omitted). Patent Owner specifically argues that Cohen’s single-use credit
`card does not satisfy this limitation because claim 1 recites “performing secure
`credit card purchases” and “limiting purchase to a single merchant,” which
`reasonable imply that the “claimed transaction code is used more than once with a
`single merchant.” Id. Independent claims 24, 25, and 29 recite similar limitations
`and Patent Owner presents a similar argument in support of these clams. Id.
`As discussed above in construing the claims, we construe the disputed
`limitation to mean any group, category, or type of merchant is included in the
`payment category prior to the customer selecting a particular merchant for a
`transaction. Cohen discloses that a card can be valid only at a certain store, groups
`of stores, or types of stores. Pet. 16, 17; Ex. 1004, 8:42–46. Cohen discloses that
`the card can be valid for purchase on a particular day or for up to a designated
`purchase limit. Ex. 1004, 8:42–46. Although Cohen discloses a single-use credit
`card, Cohen further discloses a card that can be used at a certain store for a set
`amount or for a set time period. Accordingly, we are not persuaded by Patent
`Owner’s argument.
`
`Further, Patent Owner argues that Cohen fails to disclose
`“designating/selecting a payment category that places limitations on a transaction
`code before the transaction code is generated for use to make purchases,” as
`required in claims 1 and 24. Prelim. Resp. 23–25. Patent Owner specifically
`argues that Cohen describes customizing the use of a card after the number is
`
`
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`Case IPR2014–00544
`Patent No. 7,840,486
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`generated and therefore fails to disclose including limitations on the use of the
`transaction code before the step of generating the transaction code. Prelim. Resp.
`25, 26. We are not persuaded by this argument. Cohen discloses that “a user dials
`into her credit card company before making a transaction, and . . . is provided with
`a disposable or customized number.” Ex. 1004, 3:42–46. Cohen further discloses
`that “a user can indicate in advance of purchase, on the telephone call with the
`credit card company, what the single use or the customized credit card number is to
`be used for.” Id. at 3:49–52. Accordingly, on this record, we are persuaded by
`Petitioner’s assertion that Cohen discloses Cohen discloses “designating/selecting
`a payment category that places limitations on a transaction code before the
`transaction code is generated.”
`C. Claims 16–21 – Obviousness over Cohen and Musmanno
`Petitioner contends that claims 16–21 are unpatentable under 35 U.S.C.
`§ 103 as obvious over Cohen and Musmanno. Pet. 31–36.
`1. Musmanno (Ex. 1006)
`Musmanno discloses a data processing method and apparatus for directing
`an account management system that incorporates master accounts with a plurality
`of nested subaccounts having a specific subset of individual properties. Ex. 1006,
`1:5–10. Each subaccount is directed to a specific goal, such as monthly household
`expenses, long–term investment strategies, and other financial goals. Id. at 3:5–9.
`Funds are deposited into the master account or into a specific subaccount. Id. at
`5:40–43. Upon request, the system will transfer funds from a specific account to a
`destination account. Id. at 5:47–49. Funds can be transferred on a periodic basis.
`Id. at 5:27–32. For example, as illustrated in Figure 3, funds can be transferred
`from Master Account 20 to Mortgage Subaccount 310, Car Subaccount 320, and
`Tuition Subaccount 330 every fourteen days and an automatic transfer of funds to
`
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`Case IPR2014–00544
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`Master Account 20 from the Mortgage Subaccount 310 and the Car Subaccount
`320 on the twenty-eighth day of each month. Id. at 5:53–59.
`2. Analysis
`The evidence set forth by Petitioner indicates there is a reasonable likelihood
`that Petitioner would prevail in showing that claims 16–21 are unpatentable under
`35 U.S.C. § 103 as obvious over Cohen and Musmanno. Pet. 31–36. For example,
`claim 16 recites the method of claim 8 and further recites:
`defining at least one of said plurality of payment categories to include
`using said transaction code for at least two purchases for a repeating
`transaction at a fixed amount payable at each of a fixed number of
`time intervals.
`Petitioner argues that Cohen discloses claim 8 and further discloses that
`Cohen’s transaction code can be used repeatedly for a range of dates or a series of
`dates. Pet. 33 (citing Ex. 1004, 7:44–62). Petitioner further argues that Musmanno
`discloses that a predetermined amount from a master account is transferred to at
`least two subaccounts at a fixed time interval. Pet. 33 (citing Ex. 1006, 5:53–59).
`Petitioner also argues that applying the repeating transaction steps of Musmanno to
`the transaction code generation steps of Cohen would not change the respective
`functions of each step and such a combination would have yielded the predictable
`result of the ability to use Cohen’s transaction code for repeating transactions for a
`fixed amount at fixed intervals. Id. at 32–33 (citing Ex. 1008 ¶ 64). Based on
`these arguments and supporting evidence, we are persuaded that there is a
`reasonable likelihood Petitioner would prevail in demonstrating that claim 16
`would have been obvious over Cohen and Musmanno. We are similarly persuaded
`that there is a reasonable likelihood Petitioner would prevail in demonstrating that
`claims 17–21 would have been obvious over Cohen and Musmanno. Id. at 31-36.
`
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`Case IPR2014–00544
`Patent No. 7,840,486
`
`
`Patent Owner argues that the Petition does not identify the difference
`between the cited prior art and claims, and further does not articulate a rationale for
`why a person of ordinary skill in the art would have modified Cohen and
`Musmanno to meet the claims. Prelim. Resp. 26–29. Patent Owner specifically
`argues that Petitioner’s rationale only indicates that Cohen and Musmanno are
`analogous art and such a rationale is insufficient for a showing of obviousness.
`Prelim. Resp. 28. We are not persuaded by this argument. Petitioner argues that
`[b]oth references address methods for facilitating financial
`transactions. Cohen’s method for employing a transaction code that is
`limited in use to transactions at selected vendors is a specific example
`of facilitating secure financial transactions. Cohen at 2:32-43.
`Musmanno similarly addresses a system for managing financial
`business transactions and fund transfers between various accounts.
`Musmanno at 1:5-10. More specifically, Musmanno discloses the use
`of repeating transactions, paid over a fixed number of payment
`intervals, between accounts. Id. at 5:26-31. Applying the repeating
`transaction techniques of Musmanno to the transaction code methods
`of Cohen with no change in their respective functions would have
`yielded predicable results: the use of a transaction code for repeating
`transactions. See KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398, 416
`(2007) (“The combination of familiar elements according to known
`methods is likely to be obvious when it does no more than yield
`predictable results.”). Thus, these references in their similar purpose
`of dealing with financial transactions and services, and overlapping
`teachings, confirm a motivation to combine Cohen and Musmanno
`and, as demonstrated below, should render these claims invalid. See
`Exh. 1008, Grimes Dec. at ¶ 64.
`Pet. 32–33. Petitioner argues that Musmanno discloses the repeating transactions
`technique that Cohen does not disclose. Id. Petitioner further contends that the
`combination of Musmanno’s repeating transactions technique to Cohen’s
`transaction codes, without any change to their respective functions, would yield
`predictable results. Id. Therefore, Petitioner has set forth a sufficient rationale to
`
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`modify Cohen and Musmanno and has not presented only arguments illustrating
`that Cohen and Musmanno are analogous.
`D. Claims 1–15 and 22–30 – Obviousness over Cohen or Flitcroft
`Petitioner also contends that claims 1–15 and 22–30 are unpatentable under
`35 U.S.C. § 103 as obvious over Cohen or Flitcroft, in view of a person of ordinary
`skill in the art. Pet. 57–58. Petitioner specifically argues that “[t]o the extent the
`Board finds that Cohen does not anticipate claims 1-15 and 22-30, these claims
`would be obvious over Cohen.” Id. at 57. Petitioner further argues that
`“[w]hatever difference that might be perceived to exist would be an obvious design
`choice well within the skill and knowledge of an ordinary artisan using common
`sense.” Id (citation omitted). Petitioner similarly argues that “[t]o the extent the
`Board finds that Flitcroft does not anticipate claims 1-15 and 22-30, these claims
`would be obvious over Flitcroft.” Id. Petitioner further argues that “[w]hatever
`difference that might be perceived to exist would be an obvious design choice well
`within the skill and knowledge of an ordinary artisan using common sense.” Id. at
`58 (citation omitted).
`The U.S. Supreme Court has explained that
`Section 103(a) forbids issuance of a patent when “the differences
`between the subject matter sought to be patented and the prior art are
`such that the subject matter as a whole would have been obvious at
`the time the invention was made to a person having ordinary skill in
`the art to which said subject matter pertains.”
`
`KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398, 406 (2007). The question of
`obviousness is resolved on the basis of underlying factual determinations,
`including: (1) the scope and content of the prior art, (2) any differences between
`the claimed subject matter and the prior art, and (3) the level of skill in the art.
`Graham v. John Deere Co. Kansas City, 383 U.S. 1, 17–18 (1966); see also KSR,
`
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`Case IPR2014–00544
`Patent No. 7,840,486
`
`550 U.S. at 407 (“While the sequence of these questions might be reordered in any
`particular case, the [Graham] factors continue to define the inquiry that controls.”).
`Petitioner has not established the difference between the claims and the cited
`prior art, and, therefore, also fails to establish what features or limitations would
`have been obvious or would have been obvious as a design choice. Petitioner sets
`forth conclusory statements, such as “[t]o the extent” and “[w]hatever difference
`that might be perceived to exist.” Pet. 57–58. These conclusory statements fail to
`identify clearly the difference between the claims and the prior art, and, therefore,
`Petitioner has not set forth a prima facie case of obviousness. Accordingly, we are
`not persuaded that Petitioner has established a reasonable likelihood that Petitioner
`would prevail in showing the unpatentability of claims 1–15 and 22–30 under 35
`U.S.C. § 103(a) as obvious over Cohen or Flitcroft.
`E. Remaining Grounds
`Petitioner contends that claims 1–15 and 22–30 are unpatentable under 35
`U.S.C. § 102(e) as anticipated by Flitcroft and claims 16–21 are unpatentable
`under 35 U.S.C. § 103 as obvious over Flitcroft and Musmanno. Pet. 36–56.
`However, having reviewed these grounds of unpatentability asserted by Petitioner,
`we determine that they are redundant to the ground of unpatentability on which we
`institute review for the same claims, and exercise our discretion not to institute
`review on these grounds. See 37 C.F.R. § 42.108(a).
`
`III. CONCLUSION
`For the foregoing reasons, we determine that the information presented in
`the Petition establishes that there is a reasonable likelihood that Petitioner would
`prevail in establishing the unpatentability of claims 1–30 of the ’486 patent.
`
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`Case IPR2014–00544
`Patent No. 7,840,486
`
`
`The Board has not made a final determination on the patentability of any
`challenged claims.
`
`IV. ORDER
`
`Accordingly, it is
`ORDERED that pursuant to 35 U.S.C. § 314, an inter partes review is
`hereby instituted as to the following proposed grounds:
`1.
`Anticipation of claims 1–15 and 22–30 by Cohen; and
`2.
`Obviousness of claims 16–21 over Cohen and Musmanno.
`FURTHER ORDERED that no other grounds raised in the Petition are
`authorized for inter partes review; and
`FURTHER ORDERED that pursuant to 35 U.S.C. § 314(d) and 37 C.F.R.
`§ 42.4, notice is hereby given of the institution of a trial; the trial commences on
`the entry date of this decision.
`
`
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`Case IPR2014–00544
`Patent No. 7,840,486
`
`For PETITIONER:
`Robert Scheinfeld
`Eliot Williams
`BAKER BOTTS LLP
`robert.scheinfeld@bakerbotts.com
`eliot.williams@bakerbotts.com
`
`
`
`For PATENT OWNER:
`
`Stephen J. Lewellyn
`Br