Case 6:21-cv-01101-ADA Document 73-4 Filed 01/19/23 Page 1 of 28
`Case 6:21-cv-01101-ADA Document 73-4 Filed 01/19/23 Page 1 of 28
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`EXHIBIT B
`EXHIBIT B
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`

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`Case 6:21-cv-01101-ADA Document 73-4 Filed 01/19/23 Page 2 of 28
`Trials@uspto.gov
`Paper: 11
`571-272-7822
`Date: January 4, 2023
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`APPLE INC.,
`Petitioner,
`v.
`AIRE TECHNOLOGY LIMITED,
`Patent Owner.
`
`IPR2022-01135
`Patent 8,205,249 B2
`
`
`
`
`
`
`
`
`
`Before JEFFREY S. SMITH, BRIAN J. McNAMARA, and
`MIRIAM L. QUINN, Administrative Patent Judges.
`SMITH, Administrative Patent Judge.
`
`DECISION
`Granting Institution of Inter Partes Review
`35 U.S.C. § 314
`
`
`
`
`
`
`
`

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`Case 6:21-cv-01101-ADA Document 73-4 Filed 01/19/23 Page 3 of 28
`IPR2022-01135
`Patent 8,205,249 B2
`
`INTRODUCTION
`I.
`A. Background and Summary
`Petitioner, Apple Inc., filed a Petition (Paper 2, “Pet.”) requesting
`inter partes review of claims 1–12 of U.S. Patent No. 8,205,249 B2
`(Ex. 1001, “the ’249 patent”) pursuant to 35 U.S.C. § 311(a). Patent Owner,
`Aire Technology Ltd., filed a Preliminary Response (Paper 6, “Prelim.
`Resp.”) pursuant to 35 U.S.C. § 313. With our email authorization of
`October 13, 2022 (Ex. 1024), Petitioner filed a Reply (Paper 9, “Reply”) and
`Patent Owner filed a Sur-Reply (Paper 10, “Sur-Reply”) directed solely to
`an issue regarding whether we should exercise our discretion to deny the
`Petition under 35 U.S.C. § 314(a).
`Pursuant to 35 U.S.C. § 314(a), the Director may not authorize an
`inter partes review unless the information in the petition and preliminary
`response “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.” For the reasons that follow, we institute an inter partes review as
`to claims 1–12 of the ’249 patent on the ground of unpatentability asserted in
`the Petition.
`
`II. REAL PARTIES-IN-INTEREST
`Petitioner identifies itself (Apple, Inc.) as its sole real party-in-
`interest. Pet. 68. Patent Owner identifies itself (Aire Technology Ltd.) as its
`sole real party-in-interest. Paper 4, 2.
`III. RELATED MATTERS
`The Petition states that the ’249 patent is the subject of the following
`proceedings:
`Aire Technology Ltd. v. Google LLC, No. 6-21-01104, W.D. Tex.,
`filed Oct. 25, 2021;
`
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`IPR2022-01135
`Patent 8,205,249 B2
`
`Aire Technology Ltd. v. Apple, Inc., No. 6-21-01101, W.D. Tex., filed
`Oct. 22, 2021 (“the Apple litigation”);
`
`Aire Technology Ltd. v. Samsung Electronics co, Ltd. et al., No.
`6-21-00955 W. D. Tex., filed Sep. 15, 2021;
`
`Samsung Electronics Co., Ltd. v. Aire Technology Ltd.,
`IPR2022-00875 (PTAB, Apr. 22, 2022)
`Pet. 68. Patent Owner identifies the following additional proceedings as
`“related current and/or former proceedings involving the patent at issue.”
`Paper 4, 2–3.
`Samsung Electronics Co., Ltd. v. Aire Technology Ltd.,
`IPR2022-00874 (PTAB April 22, 2022)
`
`Samsung Electronics Co., Ltd. v. Aire Technology Ltd.,
`IPR2022-00876 (PTAB May 2, 2022);
`
`Samsung Electronics Co., Ltd. v. Aire Technology Ltd.,
`IPR2022-00877 (PTAB May 2, 2022);
`
`Apple Inc. v. Aire Technology Ltd., IPR2022-01136 (PTAB June 15,
`2022);
`
`Apple Inc. v. Aire Technology Ltd., IPR2022-01137 (PTAB June 15,
`2022).
`
`IV. EXERCISE OF DISCRETION
`In the Preliminary Response, Patent Owner contends that we should
`exercise our discretion to deny the Petition in favor of the parallel Apple
`litigation identified above taking place in the U.S District Court for the
`Western District of Texas (“the Texas court”). Prelim. Resp. 1–10. The
`Board has held that the advanced state of a parallel district court action is a
`factor that may weigh in favor of denying a petition under § 314(a). See
`NHK Spring Co. v. Intri-Plex Techs., Inc., IPR2018-00752, Paper 8 at 20
`
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`IPR2022-01135
`Patent 8,205,249 B2
`(PTAB Sept. 12, 2018) (precedential); Trial Practice Guide, 58 & n.2. We
`consider the following factors to assess “whether efficiency, fairness, and
`the merits support the exercise of authority to deny institution in view of an
`earlier trial date in the parallel proceeding”:
`1. whether the court granted a stay or evidence exists that one
`may be granted if a proceeding is instituted;
`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.
`Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 11 at 5–6 (PTAB Mar. 20,
`2020) (precedential) (“Fintiv”). In evaluating these factors, we “take[] a
`holistic view of whether efficiency and integrity of the system are best
`served by denying or instituting review.” Id. at 6. We consider each of
`these factors below.
`On June 21, 2022, the Director of the USPTO 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)1.
`The Director’s memo states that “the precedential impact of Fintiv is limited
`to the facts of that case.” Guidance Memo 2. Under the Guidance Memo
`
`
`1 Available at
`https://www.uspto.gov/sites/default/files/documents/interim_proc_discretion
`ary_denials_aia_parallel_district_court_litigation_memo_20220621_.pdf.
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`“the PTAB will not rely on the Fintiv factors to discretionarily deny
`institution in view of parallel district court litigation where a petition
`presents compelling evidence of unpatentability.” Guidance Memo 2.
`[C]ompelling, meritorious challenges will be allowed to proceed
`at the PTAB even where district court litigation is proceeding in
`parallel. Compelling, meritorious challenges are those in which
`the evidence, if unrebutted in trial, would plainly lead to a
`conclusion that one or more claims are unpatentable by a
`preponderance of the evidence.”
`Guidance Memo 4.
`The Guidance memo further states,
`[c]onsistent with Sotera Wireless, Inc., the PTAB will not
`discretionarily deny institution in view of parallel district court
`litigation where a petitioner presents a stipulation not to pursue
`in a parallel proceeding the same grounds or any grounds that
`could have reasonably been raised before the PTAB.
`Guidance Memo 7–8. See Sotera Wireless, Inc. v. Masimo Corp., IPR2020-
`01019, Paper 12 (PTAB Dec. 1, 2020) (precedential as to§ II.A).
`The Guidance memo also states,
`when considering the proximity of the district court's trial date to
`the date when the PTAB final written decision will be due, the
`PTAB will consider the median time from filing to disposition of
`the civil trial for the district in which the parallel litigation
`resides.
`Guidance Memo 8–92. With these factors and guidance in mind, we
`consider the parties’ contentions.
`As to factors 1 and 2, Patent Owner contends that there is unlikely to
`be a stay, that a trial in the Apple litigation is scheduled to occur before a
`final decision will issue in this proceeding, and that the Texas court does not
`
`
`2 See https://www.uscourts.gov/statistics-reports/analysis-reports/federal-
`court-management-statistics.
`
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`move a trial date, except in extreme situations. Prelim. Resp. 3–6, Sur-reply
`1–2. Petitioner contends that generalized evidence that the Texas court
`denies stays is a neutral factor as to this particular case, and that, although
`the scheduled trial date is November 6, 2023, statistics indicate that trial is
`more likely to occur late in February 2024, i.e., after a final decision in this
`proceeding. Reply 1–2. Petitioner further notes that, even if a trial occurs
`on the scheduled date, the due date for a final decision in this proceeding is
`sufficiently close in time as to disfavor denial of institution. Id. at 2. Under
`these circumstances, we find that factors 1 and 2 do not support exercising
`discretion to deny institution.
`As to factors 3 and 4, Patent Owner argues that there is a significant
`overlap in the substance of the proceedings and that before a decision on
`institution, the parties will have invested resources to complete claim
`construction briefing, exchange infringement and invalidity contentions, and
`that discovery will be underway. Prelim. Resp. 6–9, Sur-reply 3–5. Noting
`(i) that the Texas court has already delayed a Markman claim construction
`hearing until May 16, 2023, i.e., more than four months after the due date of
`a decision on institution in this proceeding, and (ii) that fact discovery and
`expert discovery in the Apple litigation continue for two months and seven
`months, respectively, after the due date for an institution decision, Petitioner
`contends that the lack of substantial investment in the Texas litigation
`weighs against denial of institution. Reply 2–3. As to overlapping issues,
`Petitioner stipulates that “it will not pursue in the parallel district court
`proceeding the prior art obviousness combinations on which trial is
`instituted for the claims on which trial is instituted. In Sand, a nearly
`identical stipulation was found to effectively address the risk of duplicative
`efforts.” Reply 3–4 (citing Sand Revolution II, LLC v. Continental
`
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`Intermodal Group Trucking LLC, IPR201901393, Paper 24 at 11–12 (June
`16, 2020) (informative) (“Sand”)). Patent Owner asserts that Petitioner’s
`“limited stipulation is not ‘nearly identical’ to the stipulation in Sand,”
`because it fails to stipulate that Petitioner “would not pursue any ground
`raised or that could have been reasonably raised in an IPR, i.e., any ground
`that could be raised under §§ 102 or 103 on the basis of prior art patents or
`printed publications.” Sur-reply 4 (citing Sand at 12 n.5). In Sand,
`however, although the panel’s footnote stated that a broader stipulation
`would better address concerns, the panel found Petitioner’s stipulation that it
`would not pursue in district court litigation the same grounds as those
`asserted in the IPR “mitigates to some degree the concerns of duplicative
`efforts” and ‘weighs marginally in favor of not exercising discretion to deny
`institution.” Sand at 12. In these circumstances, we find that the investment
`in invalidity issues in the Apple litigation and Petitioner’s stipulation do not
`support exercising discretion to deny institution. See Sand at 10–12.
`As to factor 5, it is undisputed that Petitioner is a defendant in the
`Apple litigation. But this factor alone does not outweigh the other factors
`that thus far do not support exercising discretion to deny institution. Further
`as to factor 6, and as discussed in detail below, at this stage of the
`proceeding, we find that Petitioner has shown that at least some of the
`’249 patent claims at issue recite well-known and obvious methods for
`secure authentication of a user of a portable data carrier. Patent Owner
`acknowledges that its Preliminary Response does not address the merits of
`Petitioner’s challenges. Prelim. Resp. 9.
`Having weighed the factors above, including the relative timing of the
`proceedings, the amount of effort that has been and is yet to be expended in
`the Apple litigation and in this proceeding, Petitioner’s stipulation, and the
`
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`relative merits of Petitioner’s unrebutted challenges, we find that, taken as a
`whole, the factors do not favor exercising discretion to deny institution. In
`consideration of the above, we decline to exercise discretion to deny
`institution.
`
`V. THE ’249 PATENT
`The ’249 patent generally relates to “secure authentication of a user of
`a portable data carrier communicating with a terminal.” Ex. 1001, 1:9–10.
`A user uses the portable data carrier to perform a secure electronic
`transaction with the terminal. Id. at 3:3–9, Abstract. Fig. 1 of the ’249
`patent, shown below, illustrates the portable data carrier and the terminal.
`
`
`Figure 1 above illustrates a structure of a transaction system for
`effecting a secure electronic transaction. Ex. 1001, 3:17–18. Data network
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`12 exchanges data between terminal 14 and background system 10. Id. at
`3:42–43. Terminal 14 includes display screen 16 and input means 18. Id. at
`3:46–49. Terminal 14 includes interface 19 for communicating with
`portable data carrier 20. Terminal 14 includes sensor device 15 for detecting
`a biometric feature such as a fingerprint of user 30. Id. at 3:57–61.
`The ’249 patent explains that the “portable data carrier 20 is further
`set up to perform … a plurality of different quality user authentication
`methods.” Ex. 1001, 3:22–26. For example, the portable data carrier
`“expediently supports at least one knowledge-based authentication method,
`e.g., a PIN check, and at least one biometric method.” Id. at 3:26–28. The
`’249 patent notes that the “biometric method inherently constitutes the
`higher-quality one here, since it presupposes the personal presence of the
`user 30; this is not ensured in the knowledge-based method since the
`knowledge can have been acquired by an unauthorized user.” Id. at 3:29–34.
`When performing a secure electronic transaction, the portable data
`carrier receives either the PIN or biometric, e.g., fingerprint, input by the
`user and either “checks the transmitted PIN” or “compares the received
`extracted [fingerprint] features with the reference features stored in the
`storage means and checks whether a sufficient match is present.” Ex.1001,
`4:19–64. If the PIN or fingerprint is a match with the stored values, the
`portable data carrier “confirms the correctness to the terminal.” Id. at 4:27–
`28, 4:64–67. Then, the portable data carrier “perform[s] the security-
`establishing operation, i.e. the digital signature.” Id. at 4:30–32, 5:1–6. The
`portable data carrier also “forms quality information,” where the “quality
`information is about the quality of the previously performed user
`authentication.” Id. at 5:15–17, 5:39–41. Then, a “security message
`
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`consisting of digital signature and quality information is sent by the portable
`data carrier 20 back to the terminal 14.” Id. at 5:21–23.
`VI. ILLUSTRATIVE CLAIM
`Challenged claim 1 of the ’249 patent recites:
`1. A method for effecting a secure electronic transaction
`on a terminal using a portable data carrier arranged to perform
`different quality user authentication methods, wherein the
`portable data carrier performs a user authentication using one of
`said different user authentication methods, the portable data
`carrier confirms the proof of authentication to the terminal, and
`the portable data carrier then performs a security establishing
`operation within the electronic transaction, comprising the steps
`of creating authentication quality information by the portable
`data carrier about said user authentication method used and
`attaching said authentication quality information to the result of
`the security-establishing operation, wherein the difference in
`quality of said user authentication methods varies between an
`inherently relatively lower quality and an inherently relatively
`higher quality from a security perspective.
`VII. ASSERTED GROUNDS
`Petitioner asserts that claims 1–12 of the ’249 patent are unpatentable
`on the following ground.
`Claim(s) Challenged
`1–12
`
`Reference(s)/Basis
`Burger4, Cheng5
`
`35 U.S.C. §3
`103(a)
`
`
`3 The Leahy-Smith America Invents Act, Pub. L. No. 112-29, 125 Stat. 284
`(2011) (“AIA”), amended 35 U.S.C. § 103. Because the ’249 patent has an
`effective filing date prior to the effective date of the applicable AIA
`amendment, we refer to the pre-AIA version of § 103.
`4 U.S. Patent No. 7,080,037 B2; iss. July 18, 2006 (Ex. 1005).
`5 U.S. Publication No. 2004/0039909 A1; pub. Feb. 26, 2004 (Ex. 1006).
`
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`VIII. LEVEL OF ORDINARY SKILL
`Petitioner identifies a person of ordinary skill as someone
`knowledgeable and familiar with the secure electronic transaction arts.
`Pet. 13. Petitioner states that such a person “would have at least a four-year
`degree in electrical engineering, computer engineering, computer science, or
`a related field and two years of relevant experience in computer security, and
`developing, implementing, or deploying portable devices on systems
`connected to computer networks. A Master’s or Ph.D. degree in a relevant
`field may substitute for some work experience and greater experience might
`substitute for a four-year degree.” Id. Patent Owner does not address the
`level of ordinary skill. See generally, Prelim. Resp,
`The level of ordinary skill in the art usually is evidenced by the
`references themselves. See Okajima v. Bourdeau, 261 F.3d 1350, 1355
`(Fed. Cir. 2001); In re GPAC Inc., 57 F.3d 1573, 1579 (Fed. Cir. 1995); In
`re Oelrich, 579 F.2d 86, 91 (CCPA 1978).
`As Petitioner’s description of a person of ordinary skill appears
`commensurate with the subject matter before us, we apply Petitioner’s
`definition for purposes of this Decision.
`IX. CLAIM CONSTRUCTION
`We interpret claim terms using “the same claim construction standard
`that would be used to construe the claim in a civil action under 35 U.S.C.
`282(b).” 37 C.F.R. § 42.100(b) (2019). In this context, claim terms “are
`generally given their ordinary and customary meaning” as understood by a
`person of ordinary skill in the art in question at the time of the invention.
`Phillips v. AWH Corp., 415 F.3d 1303, 1312–13 (Fed. Cir. 2005) (citations
`omitted) (en banc). “In determining the meaning of the disputed claim
`limitation, we look principally to the intrinsic evidence of record, examining
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`the claim language itself, the written description, and the prosecution
`history, if in evidence.” DePuy Spine, Inc. v. Medtronic Sofamor Danek,
`Inc., 469 F.3d 1005, 1014 (Fed. Cir. 2006) (citing Phillips, 415 F.3d at
`1312–17). Extrinsic evidence is “less significant than the intrinsic record in
`determining ‘the legally operative meaning of claim language.’” Phillips,
`415 F.3d at 1317 (citations omitted).
`We construe only those claim terms that require analysis to determine
`whether to institute inter partes review. See Vivid Techs., Inc. v. Am. Sci. &
`Eng’g, Inc., 200 F.3d 795, 803 (Fed. Cir. 1999) (holding that “only those
`terms need be construed that are in controversy, and only to the extent
`necessary to resolve the controversy”). Any special definition for a claim
`term must be set forth in the specification with reasonable clarity,
`deliberateness, and precision. In re Paulsen, 30 F.3d 1475, 1480 (Fed. Cir.
`1994).
`Petitioner acknowledges that in parallel district court litigation, it has
`proposed the term “an inherently relatively lower quality and an inherently
`relatively higher quality from a security perspective” recited in claims 1 and
`10 be construed as indefinite. Pet. 15. Noting that in the district court,
`Patent Owner asserted no construction is necessary, Petitioner adopts Patent
`Owner’s district court proposed construction for purposes of this proceeding.
`Id.
`
`For purposes of this Decision, we agree that no construction is
`necessary, as the plain and ordinary meaning of “an inherently relatively
`lower quality and an inherently relatively higher quality from a security
`perspective” is ascertainable in the context of the claims. See Section X
`infra.
`
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`
`X. ANALYSIS
`A. Legal Standards
`“In an [inter partes review], the petitioner has the burden from the
`onset to show with particularity why the patent it challenges is
`unpatentable.” Harmonic Inc. v. Avid Tech., Inc., 815 F.3d 1356, 1363
`(Fed. Cir. 2016) (citing 35 U.S.C. § 312(a)(3) (requiring inter partes review
`petitions to identify “with particularity . . . the evidence that supports the
`grounds for the challenge to each claim”)); see also 37 C.F.R. § 42.104(b)
`(requiring a petition for inter partes review to identify how the challenged
`claim is to be construed and where each element of the claim is found in the
`prior art patents or printed publications relied upon).
`A claim is unpatentable under 35 U.S.C. § 103(a) if “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;
`(3) the level of skill in the art; and (4) when in evidence, objective evidence
`of obviousness or nonobviousness, i.e., secondary considerations. 6 See
`Graham v. John Deere Co., 383 U.S. 1, 17–18 (1966). An obviousness
`analysis “need not seek out precise teachings directed to the specific subject
`matter of the challenged claim, for a court can take account of the inferences
`
`
`6 The parties do not direct us to any objective evidence of non-obviousness
`at this stage of the proceeding.
`
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`and creative steps that a person of ordinary skill in the art would employ.”
`KSR, 550 U.S. at 418.
`Additionally, the obviousness inquiry typically requires an analysis of
`“whether there was an apparent reason to combine the known elements in
`the fashion claimed by the patent at issue.” KSR, 550 U.S. at 418 (citing
`In re Kahn, 441 F.3d 977, 988 (Fed. Cir. 2016) (requiring “articulated
`reasoning with some rational underpinning to support the legal conclusion of
`obviousness”)). Furthermore, Petitioner does not satisfy its burden of
`proving obviousness by employing “mere conclusory statements,” but “must
`instead articulate specific reasoning, based on evidence of record, to support
`the legal conclusion of obviousness.” In re Magnum Oil Tools Int’l, Ltd.,
`829 F.3d 1364, 1380 (Fed. Cir. 2016).
`B. Claims 1–12 As Obvious Over Burger and Cheng
`1. Burger – Exhibit 1005
`Burger describes a “hand-held portable electronic authorization
`device” (called a Pocket Vault) that is used to carry out electronic financial
`transactions with a terminal such as a point-of-sale or commercial interface
`station. Ex. 1005, 1:17–19, 8:38–47, 2:42–50. The Pocket Vault stores
`electronic versions of the contents of a user’s wallet, such as credit cards,
`driver’s license, library card, and frequent flyer card. Id. at 11:37–47.
`When the Pocket Vault is powered on and prior to any transaction, Pocket
`Vault authenticates the holder of the device using one or more of a plurality
`of different authentication methods. Ex. 1005, 12:6–25, 22:36–52. For
`example, the Pocket Vault may perform an “analysis of a biometric feature
`of the individual attempting use of the device (e.g., a fingerprint scan, retina
`scan, a speech pattern analysis, keystroke rhythm, etc.).” Id. at 12:9–16,
`19:41–53, 17:50–67. “Alternatively or additionally, a personal identification
`
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`(PIN) code may be entered by the holder to verify the holder’s identity.” Id.
`at 12:16–18. After authentication, the Pocket Vault transmits an encrypted
`message, including the Pocket Vault ID, to the commercial interface station.
`Id. at 23:13–19.
`The holder may then choose to “invoke a wireless transaction” with
`the interface station. Ex. 1005, 23:65–24:6, 29:40–43, 30:6–21, 2:42–50.
`Burger explains that when the Pocket Vault “communicate[s]” with the
`commercial interface station as part of the wireless transaction, it performs
`PKI-based security establishing operations “well known in the art” to secure
`the communications. Id. at 55:29–35, 12:37–51.
`2. Cheng – Exhibit 1006
`Cheng describes a “portable authentication device” carried by an
`authorizee and configured for use in electronic transactions, such as
`“transactions through a bank machine.” Ex. 1006 ¶¶ 10, 31, 39. The
`portable authentication device is configured to authenticate the holder of the
`device through a variety of authentication methods (called “authentication
`factors”) performed on the device, including non-biometric factors such as a
`PIN code or a password, and biometric factors such as a fingerprint or facial
`recognition. Id. ¶¶ 43, 34. Cheng explains that a user of the device is
`permitted to select from or delete the various alternative authentication
`factors. Id. ¶ 38.
`Cheng discloses associating different authentication factors with
`different levels of authentication, where authentication factors within the
`same level represent the same quality of authentication. Ex. 1006 ¶¶ 32–35.
`Cheng explains that “[a]n increasing level of authentication is associated
`with an increasing level of confidence in security.” Id. ¶ 33. For example,
`an authentication method based on an individual’s fingerprint has a higher
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`authentication level, or quality, than an authentication method based on a
`PIN code. Id. ¶ 34.
`Cheng provides an example of different authentication levels and
`associated authentication methods in Table 1 reproduced below:
`
`
` Cheng discloses that when several authentication methods are
`available to a user, an authorizer of a transaction, such as a vendor, may
`select a specific authorization level required for that transaction. Ex. 1006
`¶¶ 3, 5, 37. For example, for a certain transaction, the authorizer may
`require that the authorizee, or user of the device, use an authentication
`method corresponding to authentication level 3. Id. ¶¶ 34, 37. In this case,
`the authorizee would be granted access only if the authorizee uses an
`authentication method of at least level 3. Id. ¶¶ 11, 36.
`3. Reasons to Combine the Teachings of Burger and Cheng
`Petitioner contends a person of ordinary skill would have had reason
`to combine the teachings of Burger and Cole because both references
`concern methods for performing secure electronic transactions with a
`portable authentication device and the combination would allow a point-of-
`sale terminal performing such a transaction with Burger’s Pocket Vault to
`accurately gauge the security risk of the transaction by receiving information
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`about how the user of the Pocket Vault was authenticated as taught by
`Cheng. Pet. 32–36 (citing Ex. 1003, Neuman Decl. ¶¶ 50, 52–60).
`Petitioner contends that a person of ordinary skill would have had a
`reasonable expectation of success because Cheng’s technique was
`specifically intended to be implemented in a portable authentication device
`such as Burger’s Pocket Vault. Pet. 36–37 (citing Ex. 1003, Neuman Decl.
`¶ 61).
`For purposes of this Decision, we find Petitioner cites sufficient
`evidence to support its contention that a person of ordinary skill would have
`had reason to combine the teachings of Burger and Cheng.
`4. Claims 1 and 10
`The preamble of claim 1 recites a “method for effecting a secure
`electronic transaction to a terminal.” Petitioner contends that Burger
`discloses this section of the preamble in describing methods for performing
`electronic transactions between a handheld Pocket Vault and a point-of-sale
`or other commercial interface station. Pet. 38 (citing Ex. 1005, 1:17–19,
`8:38–47, 2:42–50). Petitioner contends that such transactions are secure
`because the user of the Pocket Vault is authenticated with each attempted
`use, and communications between the Pocket Vault and other devices are
`encrypted. Id. at 39 (citing Ex. 1005, 12:6–27, 12:40–50, 55:29–35). Based
`on the evidence and arguments currently of record, for purposes of
`institution, we find that Petitioner has demonstrated that Burger discloses the
`features recited in this section of the preamble of claim 1.
`The preamble of claim 1 recites “using a portable data carrier
`arranged to perform different quality user authentication methods.” The
`preamble of claim 10 recites “arranged to perform different quality user
`methods.” Petitioner contends that Burger discloses these sections of the
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`preambles of claims 1 and 10 in describing a Pocket Vault arranged to
`perform different authentication methods such as PIN-based methods and
`biometric-based methods. Pet. 40–41 (citing Ex. 1005, 12:6–25, 15:24–41,
`17:50–67, 19:41–53, Fig. 26E), 65. Petitioner contends that Cheng also
`discloses these sections of the preambles in describing different
`authentication methods associated with different levels of quality. Id. at 41–
`42 (citing Ex. 1006 ¶¶ 33–34, table 1). Based on the evidence and
`arguments currently of record, for purposes of institution, we find that
`Petitioner has demonstrated that Burger and Cheng teach the features recited
`in these sections of the preambles of claims 1 and 10.
`The preamble of claim 1 recites “wherein the portable data carrier
`performs a user authentication using one of said different user authentication
`methods, the portable data carrier confirms the proof of authentication to the
`terminal.” Claim 10 recites “the portable data carrier is arranged to perform
`a user authentication using one of said implemented user authentication
`methods and the portable data carrier is arranged to confirm the
`authentication to a terminal.” Petitioner contends that Burger discloses this
`section of the preamble of claim 1 and this limitation of claim 10 in
`describing a fingerprint scanner that scans the fingerprint of the Pocket Vault
`holder, determines whether the scanned fingerprint matches a stored
`fingerprint, and if so, transmits an encrypted message confirming
`authentication to the commercial interface station. Pet. 42–43 (citing
`Ex. 1005, 22:36–52, 23:1–4, 23:13–19, 18:10–24, Figs. 3 and 7), 65–66.
`Based on the evidence and arguments currently of record, for purposes of
`institution, we find that Petitioner has demonstrated that Burger discloses the
`features recited in this section of the preamble of claim 1 and the body of
`claim 10.
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`The preamble of claim 1 recites “the portable data carrier then
`performs a security establishing operation within the electronic transaction.”
`The preamble of claim 10 recites a “portable data carrier for performing a
`security-establishing operation within a secure electronic transaction.”
`Petitioner contends that the combination of Burger and Cheng teaches these
`sections of the preambles of cl