Trials@uspto.gov
`571-272-7822
`
`
` Paper 9
`
`Date: November 15, 2022
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`APPLE INC.,
`Petitioner,
`
`v.
`
`FINTIV, INC.,
`Patent Owner.
`
`____________
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`____________
`
`
`
`Before MICHAEL R. ZECHER, LYNNE E. PETTIGREW, and
`GEORGE R. HOSKINS, Administrative Patent Judges.
`
`ZECHER, Administrative Patent Judge.
`
`
`
`
`
`
`
`DECISION
`Granting Institution of Inter Partes Review
`35 U.S.C. § 314
`
`
`
`
`571-272-7822
`
`
` Paper 9
`
`Date: November 15, 2022
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`APPLE INC.,
`Petitioner,
`
`v.
`
`FINTIV, INC.,
`Patent Owner.
`
`____________
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`____________
`
`
`
`Before MICHAEL R. ZECHER, LYNNE E. PETTIGREW, and
`GEORGE R. HOSKINS, Administrative Patent Judges.
`
`ZECHER, Administrative Patent Judge.
`
`
`
`
`
`
`
`DECISION
`Granting Institution of Inter Partes Review
`35 U.S.C. § 314
`
`
`
`
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`
`I. INTRODUCTION
`
`Petitioner, Apple Inc. (“Apple”), filed a Petition requesting inter partes
`
`review (“IPR”) of claims 1–3 of U.S. Patent No. 9,892,386 B2 (Ex. 1001,
`
`“the ’386 patent”). Paper 2 (“Pet.”). Patent Owner, Fintiv Inc. (“Fintiv”),
`
`filed a corrected Preliminary Response. Paper 7 (“Prelim. Resp.”). We
`
`granted the parties authorization to file preliminary briefs that were tailored
`
`narrowly to address the non-exclusive list of six factors set forth in Apple
`
`Inc. v. Fintiv, Inc., IPR2020-00019, Paper 11 (PTAB Mar. 20, 2020)
`
`(precedential) (“Fintiv”) that we consider in determining whether to exercise
`
`our discretion to institute an IPR when there is a related district court case
`
`involving the same patent. Apple filed a Preliminary Reply (Paper 8
`
`(“Prelim. Reply”)); however, Fintiv elected not to file a preliminary sur-
`
`reply.
`
`Based on the authority delegated to us by the Director under 37 C.F.R.
`
`§ 42.4(a), we may not institute an IPR unless the information presented in
`
`the Petition and any response thereto shows that “there is a reasonable
`
`likelihood that the petitioner would prevail with respect to at least 1 of the
`
`claims challenged in the petition.” 35 U.S.C. § 314(a) (2018). Taking into
`
`account Fintiv’s Preliminary Response, we conclude that the information
`
`presented in the Petition establishes that there is a reasonable likelihood that
`
`Apple would prevail in challenging at least one of claims 1–3 of the ’386
`
`patent as unpatentable. Pursuant to § 314, we hereby institute an IPR as to
`
`these claims of the ’386 patent.
`
`A. Related Matter
`
`
`
`The parties indicate that the ’386 patent is the subject of the district
`
`court case captioned Fintiv, Inc. v. PayPal Holdings, Inc., No. 6:22-cv-
`
`2
`
`
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`
`00288 (W.D. Tex.) (complaint filed Mar. 17, 2022) (“Texas Action”).
`
`Pet. 1; Paper 4 (Fintiv’s Mandatory Notices), 2.1
`
`B. Real Party in Interest
`
`Apple identifies itself as the only real party in interest. Pet. 1.
`
`Fintiv identifies itself as the only real party in interest. Paper 4, 2.
`
`C. The ’386 Patent
`
`The ’386 patent, titled “Monetary Transaction System,” issued from
`
`U.S. Patent Application No. 15/201,152 (“the ’152 application”), filed on
`
`July 1, 2016. Ex. 1001, codes (54), (21), (22). The ’152 application
`
`includes an extensive chain of priority that ultimately results in it claiming
`
`the benefit of U.S. Provisional Patent Application No. 61/493,064 (“the ’064
`
`application”), filed on June 3, 2011. Id. at code (60), 1:6–19.
`
`The ’386 patent generally relates to a “monetary transaction system
`
`for conducting monetary transactions between transaction system
`
`subscribers and other entities.” Ex. 1001, 1:37–38. Figure 2 of the ’386
`
`patent, reproduced below, illustrates one embodiment of a monetary
`
`transaction system. Id. at 2:37–38.
`
`
`
`1 Fintiv’s Updated Mandatory Notices, filed in accordance with 37 C.F.R.
`§ 42.8, do not include page numbers. Paper 4. We consider the Title page
`as page 1 and then proceed from there in numerical order.
`
`3
`
`
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`
`
`
`Figure 2, reproduced above, illustrates monetary transaction system 200 that
`
`includes first subscriber 205 using mobile device 206 that runs mobile wallet
`
`application 207 to conduct indicated transaction 208 with entity 222 or 223,
`
`which may be a second subscriber, a retail store, or an agent company. Id. at
`
`14:27–64. Using mobile device 206 that runs mobile wallet application 207,
`
`first subscriber 205 sends indicated transaction 208 to transaction processor
`
`216 in mobile wallet platform 210, which, in turn, may access subscriber
`
`profile information 211 about the first subscriber and consult rules engine
`
`220 to determine whether the indicated transaction is permissible. Id.
`
`D. Challenged Claims
`
`
`
`Of the challenged claims, claims 1–3 are independent claims. Each of
`
`these three independent claims is directed to “[a] monetary transaction
`
`system for conducting monetary transactions between subscribers and other
`
`entities.” Ex. 1001, 30:54–55, 32:3–4, 33:34–35. The parties, however,
`
`appear to agree that these three independent claims differ in how the
`
`4
`
`
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`
`monetary transaction is conducted (i.e., depositing in independent claim 1,
`
`withdrawing in independent claim 2, and transferring in independent claim
`
`3). Compare Pet. 6, with Prelim. Resp. 7. Independent claim 1 is illustrative
`
`of the challenged claims and is reproduced below:
`
`1. A monetary transaction system for conducting
`monetary transactions between subscribers and other entities,
`the system comprising one or more of:
`an integration tier operable to manage mobile wallet
`sessions, the integration tier also including a communication
`application programming interface (API) and other
`communication mechanisms to accept messages from channels;
`notification services operable to send notifications
`through different notification channels including one or more of
`short message peer-to-peer, short-message services and simple
`mail transfer protocol emails;
`business process services operable to implement business
`workflows, including at least one of executing financial
`transactions, auditing financial transactions, invoking third-
`party services, handling errors, and logging platform objects;
`database services operable to store financial transaction
`details, store customer profiles, and manage money containers;
`a payment handler service operable to use APIs of
`different payment processors including one or more APIs of
`banks, credit and debit cards processors, bill payment
`processors;
`a rules engine operable to gather financial transaction
`statistics and use the gathered financial transaction statistics to
`enforce constraints including transaction constraints;
`a security service operable to perform subscriber
`authentication;
`at least one entity that is to be involved in the specified
`transaction, the at least one entity having a profile with the
`monetary transaction system: wherein the at least one entity is
`the agent;
`wherein the monetary transaction system is implemented
`to deposit funds at an agent branch, the funds being deposited
`
`5
`
`
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`
`by a subscriber at the agent branch using a mobile device
`configured to run a monetary transaction system application,
`the monetary transaction system performing the following
`steps:
`
`receiving a communication message from the
`mobile device over one of a plurality of channels
`connected to the monetary transaction system, the
`communication message being received by an API
`associated with the integration tier of the monetary
`transaction system, the communication message
`indicating that the subscriber desires to deposit a
`specified amount of funds into the subscriber’s account;
`validating the status of the subscriber’s account,
`wherein validating the status of the subscriber’s account
`comprises communicating from the integration tier to the
`database services to query attributes of the subscriber’s
`account;
`committing a pending transaction through the
`business process services, wherein the integration tier
`communicates a transaction commitment request to the
`business process services;
`receiving a confirmation from the business process
`services that the pending transaction has been committed;
`sending, through the notification services, a receipt
`notification to the mobile device; and
`upon receiving a confirmation of commitment
`from the business process services, committing the
`pending transaction to the database services; and
`wherein committing the pending transaction further
`comprises the following steps as orchestrated by the business
`process services:
`ensuring, via the database services, that the
`subscriber has an active account;
`validating, through communication with the
`security services, one or more of a PIN number and an
`access control list;
`applying with the rules engine, velocity rules;
`
`6
`
`
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`
`creating with the database services a new pending
`transaction history record;
`holding funds from the agent account balance
`using the payment handler,
`loading the funds to the subscriber account using
`the payment handler; and
`updating, using the database services, a pending
`transaction history record to reflect the funds.
`
`Id. at 30:54–32:2.
`
`E. Asserted Prior Art References
`
`Apple relies on the prior art references set forth in the table below.
`
`Name2
`
`Reference
`
`Dates
`
`Dill
`
`US 2009/0265272 A1
`
`Vadhri
`
`US 2010/0133334 A1
`
`Akashika US 2009/0217047 A1
`
`Hansen US 2004/0230527 A1
`
`Liao
`
`US 7,865,141 B2
`
`published Oct. 22, 2009;
`filed June 3, 2009
`published June 3, 2010;
`filed Dec. 3, 2008
`published Aug. 27, 2009;
`filed Nov. 18, 2008
`published Nov. 18, 2004;
`filed Apr. 26, 2004
`issued Jan. 4, 2011;
`filed June 7, 2007
`
`F. Asserted Grounds of Unpatentability
`
`Exhibit
`No.
`
`1005
`
`1006
`
`1007
`
`1008
`
`1009
`
`
`
`Apple challenges claims 1–3 of the ’386 patent based on the asserted
`
`grounds of unpatentability set forth in the table below. Pet. 6, 8–109.
`
`
`
`2 For clarity and ease of reference, we only list the first named inventor.
`
`7
`
`
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`
`Claims Challenged
`
`35 U.S.C. § Reference(s)
`
`1, 3
`
`2
`
`103(a)3
`
`Dill, Vadhri, Akashika, Hansen
`
`103(a)
`
`Dill, Vadhri, Akashika, Hansen, Liao
`
`Apple supports its arguments in the Petition with the testimony of Dr. Henry
`
`Houh. Ex. 1003 (Declaration of Dr. Houh in support of Petition). Fintiv
`
`supports its arguments in the Preliminary Response with the testimony of
`
`Michael I. Shamos, Ph.D. Ex. 2001 (Declaration of Dr. Shamos in support
`
`of Preliminary Response).
`
`II. ANALYSIS
`
`A. Discretionary Denial Arguments Under § 314(a)
`
`Apple argues that the record does not support discretionary denial
`
`under § 314(a). Pet. 109–110; Prelim. Reply 1–5. In response, Fintiv argues
`
`that we should exercise our discretion under § 314(a) to deny institution.
`
`Prelim. Resp. 45–54.
`
`Where, as here, a parallel district court case is pending involving the
`
`same patent, we follow the factors set forth in Fintiv in deciding whether to
`
`exercise our discretion to deny institution. Specifically, we weigh the
`
`following factors:
`
`1. whether the court granted a stay or evidence exists that
`one may be granted if a proceeding is instituted;
`
`
`
`3 The Leahy-Smith America Invents Act (“AIA”), Pub. L. No. 112–29, 125
`Stat. 284, 287–88 (2011), amended 35 U.S.C. § 103, effective March 16,
`2013. Because the ’386 patent claims the benefit of the ’064 application,
`which was filed before March 16, 2013, and neither party has argued that the
`provisions of the AIA apply, we apply the pre-AIA versions of the statutory
`bases for unpatentability. See Ex. 1001, codes (21), (22), (60), (63).
`
`8
`
`
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`
`2. proximity of the court’s trial date to the Board’s
`projected statutory deadline for a final written decision;
`
`3. investment in the parallel proceeding by the court and
`the parties;
`
`4. overlap between issues raised in the petition and in the
`parallel proceeding;
`
`5. whether the petitioner and the defendant in the parallel
`proceeding are the same party; and
`
`6. other circumstances that impact the Board’s exercise of
`discretion, including the merits.
`
`Fintiv, Paper 11 at 6. Recognizing that “there is some overlap among these
`
`factors” and that “[s]ome facts may be relevant to more than one factor,” we
`
`“take[] a holistic view of whether efficiency and integrity of the [patent]
`
`system are best served by denying or instituting review.” Id. On June 21,
`
`2022, the Director of the U.S. Patent and Trademark Office issued several
`
`clarifications concerning the application of the Fintiv factors. See Interim
`
`Procedure for Discretionary Denials in AIA Post-Grant Proceedings with
`
`Parallel District Court Litigation, issued June 21, 2022 (“Guidance
`
`Memo”).4 The Guidance Memo clarifies “the [Board’s] current application
`
`of Fintiv to discretionary institution where there is parallel litigation.” Id. at
`
`2.
`
`1. Factor 1—Whether the District Court Will Grant a Stay
`
`Apple represents that PayPal Holdings, Inc. (“PayPal”) has not filed a
`
`motion to stay in the Texas Action. Prelim. Reply 1. Fintiv represents that,
`
`
`
`4 Available at
`https://www.uspto.gov/sites/default/files/documents/interim_proc_discretion
`ary_denials_aia_parallel_district_court_litigation_memo_20220621_.pdf
`
`9
`
`
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`
`even if PayPal filed a motion to stay in the Texas Action, the presiding judge
`
`typically denies such a motion in view of a pending IPR. Prelim. Resp. 47.
`
`“A judge determines whether to grant a stay based on the facts of each
`
`specific case as presented in the briefs by the parties.” Apple Inc. v. Fintiv,
`
`Inc., IPR2020-00019, Paper 15 at 12 (PTAB May 13, 2020) (Decision
`
`Denying Institution) (designated informative). We decline to speculate how
`
`the district court in the Texas Action would rule on a motion to stay, if
`
`PayPal were to file such a motion, based on actions taken in different cases
`
`with different facts. Accordingly, this factor is neutral.
`
`2. Factor 2—District Court Trial Date and Factor 5—Whether Petitioner
`and the Defendant in the District Court are the Same Party
`
`Because the Petitioner here and the defendant in the Texas Action are
`
`different parties, the analysis of Factors 2 and 5 are interrelated.
`
`Accordingly, we address them together.
`
`Beginning with Factor 2, although Fintiv and PayPal have entered a
`
`joint motion to amend the scheduling order that proposes a trial date of
`
`November 30, 2023, no trial date has been set in the Texas Action. Ex. 2007
`
`(Joint Motion to Enter Agreed Scheduling Order), 8. The fact that no trial
`
`date has been set weighs against exercising our discretion to deny institution.
`
`See Oticon Med. AB v. Cochlear Ltd., IPR2019-00975, Paper 15 at 23–24
`
`(PTAB Oct. 16, 2019) (Decision on Institution) (designated precedential as
`
`to §§ II.B and II.C) (lack of trial date weighs against exercising discretion to
`
`deny institution, even when discovery is “well underway”).
`
`Putting aside that no trial date has been set in the Texas Action, the
`
`Guidance Memo states that “[a] court’s scheduled trial date . . . is not by
`
`itself a good indicator of whether the district court trial will occur before the
`
`10
`
`
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`
`statutory deadline for a final written decision,” and directs us to consider
`
`“the most recent statistics on median time-to-trial for civil actions in the
`
`district court in which the parallel litigation resides.” Guidance Memo 8–9,
`
`9 n.12 (“[t]he most recent statistics” on median time-to-trial for civil actions
`
`in district court are available at: https://www.uscourts.gov/statistics/table/
`
`na/federal-court-management-statistics/2022/03/31-1). Both parties
`
`introduced evidence that the median time-to-trial for civil actions in the U.S.
`
`District Court for the Western District of Texas is somewhere between 27.2
`
`months and 28.3 months. Prelim. Resp. 50 (citing Ex. 2006); Prelim. Reply
`
`3 (citing Ex. 1016, 37). Because the complaint in the Texas Action was filed
`
`on March 17, 2022, the projected trial date for this proceeding using the
`
`median time-to-trial statistics for civil actions in the Western District of
`
`Texas would be somewhere between late June 2024 and early July 2024.
`
`Applying the principles articulated in the Guidance Memo, Factor 2 weighs
`
`against exercising our discretion to deny institution because the projected
`
`statutory deadline for issuing a final written decision in this proceeding will
`
`fall in November 2023.
`
`Turning to Factor 5, Fintiv acknowledges that Apple is not a
`
`defendant in the Texas Action, but nevertheless argues that Apple did not
`
`include any discussion in the Petition as to “why addressing the same or
`
`substantially the same issues would not be duplicative” of the Texas Action.
`
`Prelim. Resp. 53 (citing Fintiv, Paper 11 at 14). Apple argues that “[it] is
`
`not a defendant and is not related to any defendant in the [Texas Action].”
`
`Prelim. Reply 5.
`
`Based on the current record, Fintiv has not shown that Apple is
`
`sufficiently related to PayPal—the defendant in the Texas Action—so as to
`
`11
`
`
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`
`weigh in favor of exercising our discretion to deny institution. There is
`
`nothing in the record to indicate that Apple exerts any control over the Texas
`
`Action or, for that matter, PayPal. Nor is there any evidence in the record
`
`that indicates Apple has any duty to indemnify PayPal in the Texas Action.
`
`Accordingly, taking into account that Apple is not a party to the Texas
`
`Action, Factor 5 weighs against exercising our discretion to deny institution.
`
`3. Factor 3—Investment by District Court and Parties
`
`Fintiv argues that the parties in the Texas Action have already
`
`exchanged infringement contentions and they were scheduled to exchange
`
`invalidity contentions on August 25, 2022. Prelim. Resp. 51 (citing
`
`Ex. 2007). Fintiv also argues that the parties will have exchanged claim
`
`terms for construction and preliminary claim constructions before the
`
`projected date of the institution decision in this proceeding. Id. Apple
`
`argues that “there has been minimal investment in the invalidity issues in the
`
`[Texas Action],” which is still “in the early stages.” Prelim. Reply 4.
`
`Although Fintiv represents that the parties have exchanged
`
`infringement and invalidity contentions, Fintiv readily admits that claim
`
`construction briefing will not be completed as of the projected time for
`
`entering the institution decision in this proceeding and it does not identify
`
`what discovery, if any, has been completed. Fintiv states that, “[i]f, at the
`
`time of the institution decision, the district court has not issued orders related
`
`to the patent at issue in the petition, this fact weighs against exercising
`
`discretion to deny institution.” Fintiv, Paper 11 at 10. Here, the current
`
`record indicates that the district court has not made a substantial investment
`
`in the case, apart from considering the parties’ Joint Motion to Enter Agreed
`
`Scheduling Order that is Exhibit 2007. Accordingly, we consider the facts
`
`12
`
`
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`
`that claim construction briefing has not been completed and discovery has
`
`not yet begun to lead us to weigh Factor 3 against exercising our discretion
`
`to deny institution.
`
`4. Remaining Factor 4—Overlap Between Issues Raised in the Petition
`and District Court and Factor 6—Other Circumstances That Impact
`the Board’s Exercise of Discretion, Including the Merits
`
`The remaining Factors 4 and 6, which include overlap of issues and an
`
`initial evaluation of the strength of the Petition’s merits, may impact the
`
`overall assessment. Fintiv, Paper 11 at 12–16. Under the particular
`
`circumstances present here, these two factors do not impact our analysis.
`
`For example, Fintiv argues that PayPal’s preliminary invalidity contentions
`
`were due in the Texas Action on August 25, 2022, and, therefore, they were
`
`unknown to Fintiv at the time of filing the Preliminary Response on August
`
`24, 2022. Prelim. Resp. 52 (citing Ex. 2007). Fintiv, however, did not
`
`submit PayPal’s preliminary invalidity contentions into the IPR record.
`
`Without these preliminary invalidity contentions, we decline to speculate as
`
`to whether there is significant overlap between the issues raised in the
`
`Petition and those raised in the Texas Action. To the extent that the merits
`
`present a close call for the reasons given in the Preliminary Response, this
`
`generally would favor denying institution, but only when other factors
`
`favoring denial are present. Fintiv, Paper 11 at 15. As we discuss above,
`
`there are no other factors that weigh in favor of exercising our discretion to
`
`deny institution.
`
`5. Balanced Assessment
`
`Based on a holistic review of the Fintiv factors, we conclude that we
`
`should not exercise our discretion to deny institution. The facts that no trial
`
`13
`
`
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`
`date has been set in the Texas Action, Apple is not the same party as the
`
`defendant in the Texas Action, and the district court and parties have
`
`invested minimally in the Texas Action all weigh against a discretionary
`
`denial. The relevance and weight of other factors on this record are small in
`
`comparison. Accordingly, we decline to exercise our discretion under
`
`§ 314(a) to deny the Petition.
`
`B. Discretionary Denial Arguments Under § 325(d)
`
`Fintiv argues that the Petition should be denied under 35 U.S.C
`
`§ 325(d) because Dill is listed on the face of the ’386 patent as having been
`
`considered during prosecution and, therefore, Fintiv implies that the first
`
`part of the framework set forth in Advanced Bionics, LLC v. Med-El
`
`Elektromedizinische Geräte GmbH, IPR2019-01469, Paper 6 at10 (PTAB
`
`Feb. 13, 2020) (designated precedential) (“Advanced Bionics”) has been
`
`met. Prelim. Resp. 54.
`
`We have the authority to deny a petition when “the same or
`
`substantially the same prior art or arguments previously were presented” in
`
`another proceeding before the Office. 35 U.S.C. § 325(d) (2018). A
`
`determination as to “[w]hether to deny institution of trial on the basis of
`
`35 U.S.C. § 325(d) is a fact-dependent decision.” Patent Trial and Appeal
`
`Board Consolidated Trial Practice Guide November 2019, at 62.5
`
`The question of whether a petition presents art or arguments that are
`
`“the same or substantially the same” as art or arguments previously
`
`presented to the Office may be resolved by reference to the factors set forth
`
`
`
`5Available at
`https://www.uspto.gov/sites/default/files/documents/tpgnov.pdf
`
`14
`
`
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`
`in Becton, Dickinson & Co. v. B. Braun Melsungen AG, IPR 2017-01586,
`
`Paper 8 (PTAB Dec. 15, 2017) (designated precedential as to § III.C.5, first
`
`paragraph) (“Becton, Dickinson”). The precedential section of that decision
`
`sets forth the following factors for consideration:
`
`(a) the similarities and material differences between the
`asserted art and the prior art involved during examination;
`(b) the cumulative nature of the asserted art and the prior art
`evaluated during examination;
`(c) the extent to which the asserted art was evaluated during
`examination, including whether the prior art was the basis for
`rejection;
`(d) the extent of the overlap between the arguments made
`during examination and the manner in which Petitioner relies on
`the prior art or Patent Owner distinguishes the prior art;
`(e) whether Petitioner has pointed out sufficiently how the
`Examiner erred in its evaluation of the asserted prior art; and
`(f) the extent to which additional evidence and facts presented
`in the Petition warrant reconsideration of the prior art or
`arguments.
`
`Becton, Dickinson, 17–18. Factors (a), (b), and (d) provide guidance as to
`
`whether the art or arguments presented in the petition are the same or
`
`substantially the same as those previously presented to the Office, whereas
`
`factors (c), (e), and (f) “relate to whether the petitioner has demonstrated a
`
`material error by the Office” in its prior consideration of such art or
`
`arguments. Advanced Bionics, Paper 6 at 10. “At bottom, this [two-part]
`
`framework reflects a commitment to defer to previous Office evaluations of
`
`the evidence of record unless material error is shown.” Id. at 9.
`
`When discussing the prosecution history of the ’386 patent, Fintiv
`
`states that “[t]he Examiner considered 541 separate references,” one of
`
`which was Dill, but the Examiner “did not issue a single prior art rejection.”
`
`Prelim. Resp. 7. Instead, the Examiner only issued two rejections based on
`
`15
`
`
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`
`35 U.S.C. § 101—an issue foreclosed in an IPR. See id.; see also Pet. 4
`
`(“The Examiner issued two Office Actions, rejecting the claims only on the
`
`basis of 35 U.S.C. § 101.” (citing Ex. 1002, 1606–12, 1366–71)). That is,
`
`the overlap between the art considered but not applied by the Examiner
`
`during prosecution of the ’386 patent and the art presented by Apple in the
`
`Petition is minimal because, although Dill may have been considered by the
`
`Examiner during prosecution, it is undisputed that the other four references
`
`that serve as the basis of the two obviousness grounds raised in the Petition
`
`(i.e., Vadhri, Akashika, Hansen, and Liao) were not before the Examiner
`
`during prosecution.
`
`Advanced Bionics indicates that satisfying the first part of the
`
`framework is a prerequisite to reaching the second part of the framework.
`
`See Advanced Bionics, Paper 6 at 8, 10. As we explain above, we are not
`
`persuaded that the first part of the Advanced Bionics framework has been
`
`met. As a result, we need not reach whether Fintiv has met the second part
`
`of the Advanced Bionics framework. Accordingly, we decline to exercise
`
`our discretion under § 325(d) to deny the Petition.
`
`C. Claim Construction
`
`In an IPR based on a petition filed on or after November 13, 2018,
`
`such as here, claim terms are construed using the same claim construction
`
`standard as in a civil action under 35 U.S.C. § 282(b). See 37 C.F.R.
`
`§ 42.100(b) (2019). That is, claim terms generally are construed in
`
`accordance with their ordinary and customary meaning, as would have been
`
`understood by a person of ordinary skill in the art, and the prosecution
`
`history pertaining to the patent at issue. Id. The ordinary and customary
`
`meaning of a claim term “is its meaning to the ordinary artisan after reading
`
`16
`
`
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`
`the entire patent,” and “as of the effective filing date of the patent
`
`application.” Phillips v. AWH Corp., 415 F.3d 1303, 1313, 1321 (Fed. Cir.
`
`2005) (en banc).
`
`Apple contends that “no claim term requires construction beyond its
`
`ordinary and customary meaning.” Pet. 5. Relying on the testimony of Dr.
`
`Houh, Apple asserts that “[a person of ordinary skill in the art] would apply
`
`the ordinary and customary meaning to all [claim] terms in [independent
`
`claims 1–3].” Id. (citing Ex. 1003 ¶ 43). In the Preliminary Response,
`
`Fintiv does not address claim construction. See Prelim. Resp.
`
`Based on the preliminary record, there is no readily discernible
`
`controversy between the parties that requires us to construe any claim terms
`
`at this time. See Nidec Motor Corp. v. Zhongshan Broad Ocean Motor Co.,
`
`868 F.3d 1013, 1017 (Fed. Cir. 2017) (noting that “we need only construe
`
`terms ‘that are in controversy, and only to the extent necessary to resolve the
`
`controversy’” (quoting Vivid Techs., Inc. v. Am. Sci. & Eng’g, Inc., 200 F.3d
`
`795, 803 (Fed. Cir. 1999))).
`
`D. Obviousness Over the Combined Teachings of
`Dill, Vadhri, Akashika, and Hansen
`
`Apple contends that independent claims 1 and 3 of the ’386 patent are
`
`unpatentable under § 103(a) as obvious over the combined teachings of Dill,
`
`Vadhri, Akashika, and Hansen. Pet. 14–94. Apple contends that the
`
`teachings of Dill, Vadhri, Akashika, and Hansen account for the subject
`
`matter of each challenged claim, and provides reasoning as to why a person
`
`of ordinary skill in the art would have been prompted to combine the
`
`teachings of these references. Id. Apple also relies on the testimony of Dr.
`
`Houh to support its positions. See Ex. 1003.
`
`17
`
`
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`
`Based on the preliminary record, we determine that Apple has shown
`
`that there is a reasonable likelihood that it would prevail in challenging at
`
`least one of claims 1 and 3 of the ’386 patent as unpatentable. We begin our
`
`analysis with the principles of law that generally apply to an asserted ground
`
`based on obviousness, followed by an assessment of the level of skill in the
`
`art, overviews of Dill, Vadhri, Akashika, and Hansen, and then we address
`
`the parties’ contentions with respect to the challenged claims.
`
`1. Principles of Law
`
`A claim is unpatentable under § 103(a) if the differences between the
`
`claimed subject matter 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; (3) the level of skill in
`
`the art; and (4) when in evidence, objective indicia of non-obviousness
`
`(i.e., secondary considerations).6 Graham v. John Deere Co. of Kansas City,
`
`383 U.S. 1, 17–18 (1966). We analyze the asserted grounds based on
`
`obviousness with the principles we identify above in mind.
`
`2. Level of Skill in the Art
`
`In determining whether an invention would have been obvious at the
`
`time it was made, we consider the level of ordinary skill in the pertinent art
`
`
`
`6 In its Preliminary Response, Fintiv does not present arguments or evidence
`of secondary considerations. See Prelim. Resp.
`
`18
`
`
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`
`at the time of the invention. Graham, 383 U.S. at 17. “The importance of
`
`resolving the level of ordinary skill in the art lies in the necessity of
`
`maintaining objectivity in the obviousness inquiry.” Ryko Mfg. Co. v.
`
`Nu-Star, Inc., 950 F.2d 714, 718 (Fed. Cir. 1991). The “person having
`
`ordinary skill in the art” is a hypothetical construct, from whose vantage
`
`point obviousness is assessed. In re Rouffet, 149 F.3d 1350, 1357 (Fed. Cir.
`
`1998).
`
`Factors pertinent to a determination of the level of ordinary skill in the
`
`art include “(1) the educational level of the inventor; (2) type of problems
`
`encountered in the art; (3) prior art solutions to those problems; (4) rapidity
`
`with which innovations are made; (5) sophistication of the technology; and
`
`(6) educational level of active workers in the field.” Envtl. Designs, Ltd. v.
`
`Union Oil Co. of Cal., 713 F.2d 693, 696 (Fed. Cir. 1983) (citing Orthopedic
`
`Equip. Co. v. All Orthopedic Appliances, Inc., 707 F.2d 1376, 1381–82 (Fed.
`
`Cir. 1983)). “Not all such factors may be present in every case, and one or
`
`more of these or other factors may predominate in a particular case.” Id. at
`
`696–97.
`
`For purposes of institution, there is sufficient evidence in the record
`
`that enables us to determine the knowledge level of a person of ordinary skill
`
`in the art. Relying on the testimony of Dr. Houh, Apple argues the
`
`following:
`
`[a] person of ordinary skill in the art . . . in June 2011 would have
`had a working knowledge of mobile payment techniques
`pertinent to the ’386 patent, including software development in
`the field of mobile payment techniques. Such [a person of
`ordinary skill in the art] would have had a bachelor’s degree in
`electrical engineering, computer science, or equivalent training,
`and approximately two years of work experience in software
`
`19
`
`
`
`IPR2022-00976
`Patent 9,892,386 B2
`
`
`development. Lack of work experience can be remedied by
`additional education, and vice versa.
`
`Pet. 4 (citing Ex. 1003 ¶¶ 21, 22).
`
`Relying on the testimony of Dr. Shamos, Fintiv offers a slightly
`
`different assessment of the le
Accessing this document will incur an additional charge of $.
After purchase, you can access this document again without charge.
Accept $ Charge
Still Working On It
This document is taking longer than usual to download. This can happen if we need to contact the court directly to obtain the document and their servers are running slowly.
Give it another minute or two to complete, and then try the refresh button.
A few More Minutes ... Still Working
It can take up to 5 minutes for us to download a document if the court servers are running slowly.
Thank you for your continued patience.
This document could not be displayed.
We could not find this document within its docket. Please go back to the docket page and check the link. If that does not work, go back to the docket and refresh it to pull the newest information.
Your account does not support viewing this document.
You need a Paid Account to view this document. Click here to change your account type.
Your account does not support viewing this document.
Set your membership
status to view this document.
With a Docket Alarm membership, you'll
get a whole lot more, including:
- Up-to-date information for this case.
- Email alerts whenever there is an update.
- Full text search for other cases.
- Get email alerts whenever a new case matches your search.
One Moment Please
The filing “” is large (MB) and is being downloaded.
Please refresh this page in a few minutes to see if the filing has been downloaded. The filing will also be emailed to you when the download completes.
Your document is on its way!
If you do not receive the document in five minutes, contact support at support@docketalarm.com.
Sealed Document
We are unable to display this document, it may be under a court ordered seal.
If you have proper credentials to access the file, you may proceed directly to the court's system using your government issued username and password.
Access Government Site
