Trials@uspto.gov
`Tel: 571-272-7822
`
`Paper 31
`Entered: November 7, 2016
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`APPLE INC.,
`Petitioner,
`
`V.
`
`SMARTFLASH LLC,
`Patent Owner.
`
`Case CBM2015-00124
`Patent 7,942,317 B2
`
`Before JENNIFER S. BISK, RAMA G. ELLURU,
`JEREMY M. PLENZLER, and MATTHEW R. CLEMENTS,
`Administrative Patent Judges.
`
`ELLURU, Administrative Patent Judge.
`
`FINAL WRITTEN DECISION
`35 US.C. § 328(a) and 37 CFR. § 42.73
`
`
`Tel: 571-272-7822
`
`Paper 31
`Entered: November 7, 2016
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`APPLE INC.,
`Petitioner,
`
`V.
`
`SMARTFLASH LLC,
`Patent Owner.
`
`Case CBM2015-00124
`Patent 7,942,317 B2
`
`Before JENNIFER S. BISK, RAMA G. ELLURU,
`JEREMY M. PLENZLER, and MATTHEW R. CLEMENTS,
`Administrative Patent Judges.
`
`ELLURU, Administrative Patent Judge.
`
`FINAL WRITTEN DECISION
`35 US.C. § 328(a) and 37 CFR. § 42.73
`
`
`
`CBM2015-00124
`Patent 7,942,317 B2
`
`INTRODUCTION
`
`A. Background
`Apple Inc. (“Petitioner”), filed a Petition to institute covered business
`
`method patent review of claims 1-17 and 19 of U.S. Patent No. 7,942,317
`
`B2 (Ex. 1001, “the ’317 patent’’) pursuant to § 18 of the Leahy-Smith
`America Invents Act (“AIA”). Paper 2 (“Pet.”).! Smartflash LLC (“Patent
`
`Owner’) filed a Preliminary Response. Paper 5 (Prelim. Resp.”). On
`
`November10, 2015, we instituted a covered business method patent review
`
`(Paper7, “Institution Decision”or “Inst. Dec.””) based upon Petitioner’s
`
`assertion that claims 2-5, 9-11, 14, 15, 17, and 19 (“the challenged claims”)
`
`are directed to patent ineligible subject matter under 35 U.S.C. § 101 and
`
`claim 19 as being indefinite under 35 U.S.C. § 112, second paragraph. Inst.
`
`Dec. 25. Becausea final written decision determining that claims 1, 6-8, 12,
`
`13, and 16 of the *317 patent are unpatentable under § 103 had already
`
`issued in CBM2014-00112, we declined to institute a review of claims 1, 6—
`
`8, 12, 13, and 16 in this proceeding. Jd. at 6—7.
`
`Subsequentto institution, Patent Ownerfiled a Patent Owner
`
`Response (Paper 17, “PO Resp.”) and Petitioner filed a Reply (Paper 21,
`
`“Pet. Reply”) to Patent Owner’s Response.
`
`Patent Owner, with authorization,filed a Notice of Supplemental
`
`Authority. Paper 28 (“Notice”). Petitioner filed a Response to Patent
`
`Owner’s Notice. Paper 29 (“Notice Resp.”).
`
`Weheld a joint hearing of this case and several other related cases on
`
`July 18, 2016. Paper 30 (“Tr.”).
`
`Pub. L. No. 112-29, 125 Stat. 284, 296-07 (2011).
`
`
`
`CBM2015-00124
`Patent 7,942,317 B2
`
`Wehavejurisdiction under 35 U.S.C. § 6(c). This Final Written
`
`Decision is issued pursuant to 35 U.S.C. § 328(a) and 37 C.FR. § 42.73.
`
`For the reasons that follow, we determine that Petitioner has shown by a
`
`preponderanceofthe evidence that claims 2-5, 9-11, 14, 15, 17, and 19 of
`
`the ’317 patent are directed to patent ineligible subject matter under
`
`35 U.S.C. § 101. We also determine that claim 19 is indefinite under
`
`35 U.S.C. § 112.
`
`B. Related Matters
`
`Theparties indicate that the °317 patent is the subject of the following
`district court cases: Smartflash LLC v. Apple Inc., Case No. 6:15-cv-145
`(E.D. Tex.); Smartflash LLC v. Google, Inc., Case No. 6:14-cv-435 (E.D.
`
`Tex.); Smartflash LLC v. Apple Inc., Case No. 6:13-cv-447 (E.D. Tex.);
`
`Smartflash LLC v. Samsung Electronics Co. Ltd., Case No. 6:13-cv-448
`
`(E.D. Tex.); and Smartflash LLC v. Amazon.Com,Inc., Case No. 6:14-cv-
`
`992 (E.D. Tex.). Pet. 2, 32-33; Paper 4, 4-5.
`
`Wehaveissued a previous Final Written Decision in a review
`challenging the ’317 patent. In CBM2014-00112,? we found claims 1, 6-8,
`
`12, 13, 16, and 18 unpatentable under 35 U.S.C. § 103. Apple Inc. v.
`Smartflash LLC, Case CBM2014-00112, (PTAB Sept. 25, 2015) (Paper 48,
`29). In CBM2015-00018, we terminated review of claim 18 before issuing a
`
`Final Written Decision. Apple Inc. v. Smartflash LLC, Case CBM2015-
`
`00018, (PTAB March 18, 2016) (Paper 46, 2-3). In CBM2015-00129, we
`
`terminated review of claims 7 and 12 before issuing a Final Written
`
`2 Case CBM2014-00113 was consolidated with the CBM2014-00112
`proceeding.
`
`
`
`CBM2015-00124
`Patent 7,942,317 B2
`
`Decision. Google Inc. v. Smartflash LLC, Case CBM2015-00129, (PTAB
`
`April 26, 2016) (Paper 25, 2-3).
`
`C. The ’317 Patent
`
`The *317 patent relates to “a portable data carrier for storing and
`
`paying for data and to computer systems for providing access to data to be
`
`stored,” and the “corresponding methods and computer programs.”
`
`Ex. 1001, 1:18-23. Owners of proprietary data, especially audio recordings,
`
`have an urgent need to address the prevalence of “data pirates,” who make
`
`proprietary data available over the internet without authorization. Jd.at
`
`1:38-51. The °317 patent describes providing portable data storage together
`
`with a meansfor conditioning access to that data upon validated payment.
`
`Id. at 1:55—2:3. This combination allows data owners to maketheir data
`
`available over the internet without fear of data pirates. Id. at 2:3-11.
`
`Asdescribed, the portable data storage device is connected to a
`
`terminal for internet access. Jd. at 1:55-63. The terminal reads payment
`
`information, validates that information, and downloadsdata into the portable
`
`storage device from a data supplier. Jd. The data on the portable storage
`
`device can be retrieved and output from a mobile device. Jd. at 1:64-67.
`
`The ’317 patent makesclear that the actual implementation of these
`
`componentsis not critical and the alleged invention may be implemented in
`
`many ways. See, e.g., id. at 25:49-52 (“The skilled person will understand
`
`that many variants to the system are possible and the invention is not limited
`
`to the described embodiments.”).
`
`D. Challenged Claims
`
`The claims under review are claims 2—5, 9-11, 14, 15, 17, and 19 of
`
`the ’317 patent. Inst. Dec. 25. Of the challenged claims, claims 17 and 19
`
`
`
`CBM2015-00124
`Patent 7,942,317 B2
`
`are independent. Claims 2—5 depend,directly or indirectly, from
`
`independentclaim 1 (notapart of this review). Claims 9-11 depend,
`
`directly or indirectly, from independent claim 8 (not a part of this review).
`
`Claims 14 and 15 depend,directly or indirectly, from independent claim 12
`
`(not a part of this review). Independent claims 17 and 19 are illustrative and
`
`recite the following:
`
`17. A computer system for providing data to a data requester,
`the system comprising:
`a communication interface;
`a data access data store for storing records of data items
`available from the system, each record comprising a data item
`description and location data identifying an electronic address
`for a provider for the data item;
`.
`a program store storing code implementable by a
`processor;
`a processor coupled to the communicationsinterface, to
`the data access data store, and to the program store for
`implementing the stored code, the code comprising:
`code to receive a request for a data item from the
`requester:,
`code to receive from the communications interface
`payment data comprising data relating to paymentfor the
`requested data item;
`code responsive to the request and to the received
`payment data to output the item data to the requester over the
`communication interface; wherein
`said data access data store further comprises data item
`accessrule data for output to the requester with a said data item;
`and
`
`further comprising code to select access rule data for
`output with a data item in responseto said paymentdata.
`
`19. A methodof providing data to a data requester
`comprising:
`receiving a request for a data item from the requester;
`
`
`
`CBM2015-00124
`Patent 7,942,317 B2
`
`receiving payment data from the requesterrelating to
`paymentfor the requested data;
`transmitting the requested data to the requester; and
`transmitting data accessrule data to requester with the
`read data.
`
`A. Claim Construction
`
`ANALYSIS
`
`In a covered business methodpatent review, claim terms are given
`
`their broadest reasonable interpretation in light of the specification in which
`
`they appear and the understanding ofothers skilled in the relevant art. See
`
`37 C.F.R. § 42.300(b). Applying that standard, we interpret the claim terms
`
`of the °317 patent according to their ordinary and customary meaningin the
`
`context of the patent’s written description. See In re Translogic Tech., Inc.,
`
`504 F.3d 1249, 1257 (Fed. Cir. 2007). For purposes of this Decision, we
`
`need not construe expressly any claim term.
`
`B. Statutory Subject Matter
`The Petition challenges claims 2-5, 9-11, 14, 15, 17, and 19 as
`
`directed to patent-ineligible subject matter under 35 U.S.C. § 101. Pet. 38—
`73. According to the Petition, the challenged claims are directed to an
`abstract idea without additional elements that transform the claims into a
`
`patent-eligible application ofthat idea. Jd. Petitioner submits a declaration
`from Dr. John P. J. Kelly in support ofits Petition.? Ex. 1017. Patent
`
`Ownerarguesthat the challenged claims are statutory because they are
`
`3 In its Response, Patent Ownerargues that Dr. Kelly’s declaration should be
`given little or no weight. PO Resp. 5-16. Because Patent Ownerhas filed a
`Motion to Exclude (Paper 24) that includes a request to exclude Dr. Kelly’s
`Declaration in its entirety, or in the alternative, portions of the declaration
`based on essentially the same argument, we address Patent Owner’s
`argumentas part of our analysis of the motion to exclude, below.
`
`
`
`CBM2015-00124
`Patent 7,942,317 B2
`
`“rooted in computer technology in order to overcomea problem specifically
`
`arising in the realm of computer networks,””that of “data content piracy on
`
`the Internet.” PO Resp. 2 (citation omitted).
`
`1. Abstract Idea
`
`Under 35 U.S.C. § 101, we mustfirst identify whether an invention
`
`fits within one of the four statutorily provided categories of patent-
`
`eligibility: “processes, machines, manufactures, and compositions of
`
`matter.” Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 713-714 (Fed. Cir.
`
`2014). Here, each of the challenged claims recites a “machine,”i.e., a
`
`“computer system”(claims 2-5, 17), a “data access system”(claims 14 and
`
`15), or a “process,”i.e., a “method” (claims 9-11, 19), under § 101. Section
`
`101, however, “contains an important implicit exception [to subject matter
`
`eligibility]: Laws of nature, natural phenomena, and abstract ideas are not
`
`patentable.” Alice Corp. Pty. Ltd. v. CLS Bank Int’l., 134 S. Ct. 2347, 2354
`
`(2014)(citing Assoc. for Molecular Pathology v. Myriad Genetics, Inc., 133
`
`S. Ct. 2107, 2116 (2013) (internal quotation marks and brackets omitted)).
`
`In Alice, the Supreme Court reiterated the frameworkset forth previously in
`
`Mayo Collaborative Services v. Prometheus Laboratories, 132 S. Ct. 1289,
`
`1293 (2012) “for distinguishing patents that claim laws ofnature, natural
`
`phenomena,and abstract ideas from those that claim patent-eligible
`
`applications of these concepts.” Alice, 134 S. Ct. at 2355. Thefirst step in
`
`the analysis is to “determine whether the claims at issue are directed to one
`
`of those patent-ineligible concepts.” Jd.
`
`Accordingto the Federal Circuit, “determining whether the section
`
`101 exception for abstract ideas applies involves distinguishing between
`
`patentsthat claim the building blocks ofhuman ingenuity—andtherefore
`
`
`
`CBM2015-00124
`Patent 7,942,317 B2
`
`risk broad pre-emption of basic ideas—andpatents that integrate those
`
`building blocks into something more, enoughto transform them into specific
`
`patent-eligible inventions.” Versata Dev. Grp., Inc. v. SAP Am., Inc., 793
`
`F.3d 1306, 1332 (Fed. Cir. 2015) (emphasis added); accord id. at 1333-34
`
`(“It is a building block, a basic conceptualframework for organizing
`
`information ....” (emphasis added)). This is similar to the Supreme Court’s
`
`formulation in Bilski v. Kappos, 561 U.S. 593, 611 (2010) (emphasis added),
`
`noting that the conceptof risk hedging is “afundamental economic practice
`
`long prevalent in our system of commerce.” See also buySAFE, Inc. v.
`
`Google, Inc., 765 F.3d 1350, 1353-55 (Fed. Cir. 2014) (stating that patent
`
`claimsrelated to “long-familiar commercial transactions” and relationships
`
`(i.e., business methods), no matter how “narrow”or “particular,” are
`
`directed to abstract ideas as a matter of law). As a further example, the
`“concept of ‘offer based pricing’ is similar to other ‘fundamental economic
`concepts’ found to be abstract ideas by the Supreme Court and [the Federal
`
`Circuit].” OJP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1362 (Fed.
`
`Cir. 2015) (citations omitted).
`
`Petitioner argues that the challenged claimsare directed to the abstract
`
`idea of “paymentfor and controlling access to data.” Pet. 38. Specifically,
`
`Petitioner contends that the challenged claimsare ‘“‘drawn to the concept of
`
`paymentfor data, reciting steps and ‘code to,’ e.g., transmit or forward data
`
`after payment” and that every challenged claims expressly recites
`
`““nayment.’” Id. at 42.
`
`Weare persuadedthat the challenged claims are drawnto a patent-
`
`ineligible abstract idea. Specifically, the challenged claimsare directed to
`
`performing the fundamental economicpractice of conditioning and
`
`
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`CBM2015-00124
`Patent 7,942,317 B2
`
`controlling access to content based on payment. For example, claim 17
`
`recites “code responsive to the request and to the received paymentdata to
`
`outputthe item datato the requester” and “codeto select access rule data for
`output with a data item in response to said paymentdata.” Claim 19 recites
`
`“receiving payment data from the requester relating to paymentforthe
`
`requested data.”
`
`Asdiscussed above, the °317 patent discusses addressing recording
`
`industry concernsofdata pirates offering unauthorized access to widely
`
`available compressed audio recordings. Ex. 1001, 1:27-51. The ’317 patent
`
`proposes to solve this problem byrestricting access to data on a device based
`
`uponsatisfaction of use rules linked to payment data. Jd. at 9:4-22. The
`
`’317 patent makesclearthat the heart of the claimed subject matter is
`
`restricting access to stored data based on supplier-defined access rules and
`
`payment data. Jd. at 1:55-2:11, Abstract.
`Althoughthe specification refers to data piracy on the Internet, the
`challenged claimsare not limited to the Internet. The underlying concept of
`
`the challenged claims, particularly when viewedin light of the specification,
`
`is paying for and/or controlling access to content, as Petitioner contends. As
`
`discussed further below,this is a fundamental economic practice long in
`
`existence in commerce. See Bilski, 561 U.S. at 611.
`
`Patent Ownerarguesthat the challenged claims are not directed to an
`
`abstract idea. Patent Ownerasserts that claims 2-5, 14, 15, and 17 are
`
`“patent eligible because they are directed to real-world computer systems
`
`and data access systemsthat are machines with specialized physical
`
`componentsthat allow a data item to be transmitted after payment data is
`received and/or validated.” PO Resp. 25. Specifically, Patent Owner argues
`
`
`
`CBM2015-00124
`Patent 7,942,317 B2
`
`that claims 2—5 and 17 are directed to “machines comprised of various
`
`structural components - a computer system with specifically defined
`
`elements”(id. at 20), and that claims 14 and 15 are “directed to a data access
`
`system, which is a machine”(id. at 21). Patent Owner further contends that
`
`that claims 9-1] and 19 are “patent eligible because they are directed to
`
`real-world useful processes for the purchase and transmission of data with
`
`data accessrules data to allow for authorized use of the data.” Jd. at 25.
`
`Specifically, Patent Owner contendsthat these claims are “directed to
`
`processes (methods) with specifically defined elementsas steps.” Jd. at 22.
`
`Patent Owner, however, cites no controlling authority to support the
`
`proposition that subject matter is patent-eligible as longas it is directed to
`
`“machines with specialized physical components”or “real-world useful
`
`processes.” PO Resp. 25. AsPetitioner correctly points out (Pet. Reply 2—
`
`3), that argument is contradicted by well-established precedent:
`
`Thereis no dispute that a computeris a tangible system (in § 101
`terms, a “machine”), or that many computer-implemented claims
`are formally addressed to patent-eligible subject matter. But if
`that were’ the end of the § 101 inquiry, an applicant could claim
`any principle of the physical or social sciences by reciting a
`computer system configured to implement the relevant concept.
`Such a result would make the determination ofpatenteligibility
`“depend simply on the draftman’s art,” ... thereby eviscerating
`the rule that “‘... abstract ideas are not patentable.’”
`
`Alice, 134 S. Ct. at 2358-59 (internal citations omitted).
`
`Patent Owneralso argues that the challenged claimsare like those
`
`foundnotto be directed to an abstract idea in Google Inc. v. Network-1
`
`Technologies, Inc., CBM2015-00113, and in Hulu, LLC v. iMTX Strategic,
`
`LLC, CBM2015-00147. PO Resp. 22—23. These decisions are non-
`
`precedential and distinguishable. In CBM2015-00113, the panel’s
`
`10
`
`
`
`CBM2015-00124
`Patent 7,942,317 B2
`
`determination turned on a step requiring “correlating, by the computer
`
`system using a non-exhaustive, near neighborsearch, the first electronic
`
`media work with [an or the first] electronic media work identifier” and on
`
`the Petitioner’s formulation of the alleged abstract idea. Google Inc. v.
`
`Network-1 Technologies, Inc., CBM2015-00113 (PTAB Oct. 19, 2015)
`
`(Paper 7, 13).
`
`Patent Ownerarguesthat the challenged claimsare like those at issue
`
`in CBM2015-00113 because each “requires transmission or forwarding of a
`
`data item responsive to or correlated with some other data (payment data or
`
`data access rule data).” PO Resp. 22-23. As the panel in CBM2015-00113
`
`explained, however, the claims at issue there required “particular types of
`
`searching processes”—1.e., “a non-exhaustive, near neighbor search”—that
`
`are different than the abstract idea alleged by Petitioner in that proceeding.
`
`CBM2015-00113, Paper 7, 12-13. In this case, none of the challenged
`
`claims recite a specific search process by which transmission or forwarding
`
`of a data item would be correlated with data items. For example, claim 1
`
`(not part of this review, but from which claims 2—5 depend)recites “code
`
`responsive to the request and to the received paymentdata, to read data for
`
`the requested data item” and “code to transmit the read to the requester.”
`
`Independentclaim 19 recites “receiving payment data from the requester
`
`relating to paymentfor the requested data” and “transmitting the requested
`
`data to the requester.” With respect to CBM2015-00147, Patent Owner
`
`mischaracterizes the Institution Decision. PO Resp. 23~24. The panel’s
`
`determination in that case was based on step two,not step one, of the
`
`Mayo/Alice test. Hulu, LLC v. iMTX Strategic, LLC, CBM2015-00147
`
`(PTAB Nov.30, 2015) (Paper 14, 14) (‘As in DDR, weare persuadedthat,
`
`11
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`
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`CBM2015-00124
`Patent 7,942,317 B2
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`howeverthe abstract idea is characterized, the ’854 patent claims do not
`
`meetthe second prong of the Mayo/Alicetest.”).
`
`Patent Owner’s Notice of Supplemental Authority also does not alter
`
`our determination. Patent Ownerarguesthat the challenged claims are
`999
`“directed to an improvement to computer functionality.’” Notice 1 (quoting
`
`Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1336 (Fed. Cir. 2016)). The
`
`challenged claims, according to Patent Owner,are “directed to specific
`
`organization of data and defined sequencesoftransaction steps with distinct
`
`advantagesoveralternatives”(id. at 2) and, therefore, “like those in Enfish,
`
`‘are directed to a specific implementation ofa solution to a problem,’ in
`
`Internet digital commerce”(id. at 3) (emphasis added by Patent Owner).
`
`Unlikethe self-referential table at issue in Enfish, however, the challenged
`
`claims do not purport to be an improvement to the way computers operate.
`
`Instead, they “merely implementan old practice in a new environment.”
`
`FairWarning IP, LLC v. Iatric Systems, Inc., No. 2015-1985, slip op. 7 (Fed.
`
`Cir. Oct. 11, 2016). Petitioner argues, and we agree, that the challenged
`
`claims, like those in Jn re TLI Communications LLC Patent Litigation, 823
`
`F.3d 607 (Fed. Cir. 2016), “‘perform{] generic computer functions such as
`
`storing, receiving, and extracting data’ using ‘physical components” that
`
`““behave exactly as expected accordingto their ordinary use’ and ‘merely
`
`provide a generic environmentin which to carry out the abstract idea’ of
`
`controlling access to content based on payment and/orrules.” Notice Resp.
`
`2-3 (quoting In re TLI Communications LLC PatentLitigation, 823 F.3d at
`
`612-15). The limitations of the challenged claims—e.g., “code to receive a
`
`request,”“code to receive .
`
`.
`
`. payment data,” “code responsive to the
`
`12
`
`
`
`CBM2015-00124
`Patent 7,942,317 B2
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`request andto the received payment data,” and “codeto select access rule
`
`data for output”—are so general that they
`
`do no more than describe a desired function or outcome, without
`providing any limiting detail
`that confines the claim to a
`particular solution to an identified problem. The purely
`functional nature of the claim confirmsthat it is directed to an
`abstract idea, not to a concrete embodimentof that idea.
`
`Affinity Labs of Texas, LLC v. Amazon.com Inc., No. 2015-2080, slip
`
`op. 7 (Fed. Cir. Sept. 23, 2016) (citation omitted).
`
`Weare, thus, persuaded, based on the specification and the language
`
`of the challenged claims, that claims 2—5, 9-11, 14, 15, 17, and 19 of the
`
`’317 patent are directed to an abstract idea. See Alice, 134 S. Ct. at 2356
`
`(holding that the concept of intermediated settlement at issue in Alice was an
`
`abstract idea); Accenture Global Servs., GmbH v. Guidewire Software, Inc.,
`
`728 F.3d 1336, 1344 (Fed. Cir. 2013) (holding the abstract idea at the heart
`
`of a system claim to be “generating tasks [based on] rules .
`
`.
`
`. to be
`
`completed upon the occurrence of an event”).
`
`2. Inventive Concept
`“A claim that recites an abstract idea must include ‘additional
`
`features’ to ensure ‘that the [claim] is more than a drafting effort designed to
`
`monopolize the [abstract idea].’” Alice, 134 S. Ct. at 2357 (quoting Mayo,
`
`132 S. Ct. at 1297). “This requires more than simply stating an abstract idea
`
`while adding the words‘applyit’ or ‘apply it with a computer.’ Similarly,
`
`the prohibition on patenting an ineligible concept cannot be circumvented by
`
`limiting the use of an ineligible concept to a particular technological
`
`environment.” Versata, 793 F.3d at 1332 (citations omitted). Moreover, the
`
`mererecitation of generic computer components performing conventional
`
`13
`
`
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`CBM2015-00124
`Patent 7,942,317 B2
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`functions is not enough. See Alice, 134 S. Ct. at 2360 (“Nearly every
`
`computerwill include a ‘communications controller’ and ‘data storage unit’
`
`capable of performing the basic calculation, storage, and transmission
`
`functions required by the method claims.”).
`
`Petitioner arguesthat “the [challenged c]laims’ ‘additional features’
`recite only well-known, routine, and conventional computer components and
`activities, which is insufficient to establish an inventive concept.” Pet.
`
`Reply 6. Weare persuadedthat claims 2—5, 9-11, 14, 15, 17, and 19 of the
`
`’317 patent do not add an inventive concept sufficient to ensure that the
`
`patent in practice amountsto significantly more than a patent on the abstract
`
`idea itself. Alice, 134 S. Ct. at 2355; see also Accenture Global Servs., 728
`
`F.3d at 1344 (holding claims directed to the abstract idea of “generating
`
`tasks [based on] rules .
`
`.
`
`. to be completed upon the occurrence of an event”
`
`to be unpatentable even when applied in a computer environment and within
`
`the insurance industry). Specifically, we agree with and adoptthe rationale
`
`articulated in the Petition that the additional elements of the challenged
`
`claimsareeitherfield of use limitations and/or generic features of a
`
`computerthat do not bring the challenged claims within § 101 patent
`
`eligibility. Pet. 48-72.
`
`a. Technical Elements
`
`Petitioner argues that the challenged claims are unpatentable because
`
`they “are directed only to an abstract idea with nothing more than ‘well-
`
`understood, routine, conventional activity’ added.” Pet. 49 (citations
`
`omitted). Patent Owner disagrees, arguing that the challenged claims are
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`patentable because they recite “specific ways of using distinct memories,
`
`data types, and userules that amount to significantly more than the
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`underlying abstract idea.” PO Resp. 40 (quoting Ex. 2049, 19) (emphasis
`
`omitted). We agree with Petitioner for the following reasons.
`
`The ’317 patent treats as well-known all potentially technical aspects
`
`of the challenged claims, which simply require generic computer
`
`components(e.g., processor, program store, data access store, and
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`communicationsinterfaces). See Pet. Reply 6-11, 15 (citing Ex. 1001,
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`3:66-67, 11:27-29, 12:29-32, 13:35-38, 14:25—29; 16:46—50, 18:7-17).
`
`For example, the specification states the recited “data store” in independent
`
`claim 17 may be a generic device such as a “standard smart card.” Ex. 1001,
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`11:28-30; see also id. at 14:25-29 (“[l]ikewise data stores 136, 138 and 140
`
`may comprise a single physical data store or may be distributed over a
`
`plurality of physical devices and may evenbeat physically remote locations
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`from processors 128-134 and coupled to these processors via internet 142”),
`
`Fig. 6. Moreover, on this record, Patent Owner has not argued persuasively
`
`that any of the other potentially technical additions to the claims performs a
`
`function that is anything other than “purely conventional.” Alice, 134 S. Ct.
`
`at 2358. The use of a data/program store andthe linkage of existing
`
`hardware devices appear to be “‘well-understood, routine, conventional
`
`activit[ies]’ previously known to the industry.” Alice, 134 S. Ct. at 2359;
`Mayo, 132 S.Ct. at 1294.
`
`Further, “[t]he challenged claims’ ‘code to’ and other functional
`
`limitations simply instruct that the abstract idea of payment for and
`controlling access to data should be implementedin software.” Pet. 52. The
`claimed computer code performs generic computer functions, such as
`
`receiving, reading, being responsive to, selecting, outputting and
`
`transmitting. See Pet. 52-55. The recitation of these generic computer
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`functionsis insufficient to confer specificity. See Content Extraction and
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`Transmission LLC v. Wells Fargo Bank, Nat’l Ass’n, 776 F.3d 1343, 1347
`
`(Fed. Cir. 2014) (“The concept of data collection, recognition, and storageis
`
`undisputedly well-known. Indeed, humans have always performed these
`
`functions.”).
`
`Moreover, weare not persuadedthat claims 2—5, 9-11, 14, 15, 17, and
`
`19 “recite specific ways of using distinct memories, data types, and use rules
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`that amountto significantly more than” paying for and/or controlling access
`
`to content. See PO Resp. 40 (quoting Ex. 2049, 19). The challenged claims
`
`generically recite several memories, including “data store” and “a program
`
`store,” and generically recite several data types, including “data,” “data
`99 66
`93 66
`
`item,”
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`“code,”
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`“paymentdata,” and “access rule data.” Weare not
`
`persuadedthatthe recitation of these memories and data types, byitself,
`
`amounts to significantly more than the underlying abstract idea. Patent
`
`Ownerdoes not point to any inventive concept in the 317 patent related to
`the way these memoriesor data types are constructed or used. In fact, the
`
`’317 patent simply discloses these memories and data types with no
`
`description of the underlying implementation or programming. See Content
`
`Extraction and Transmission LLC, 776 F.3d at 1347 (“The concept of data
`
`collection, recognition, and storage is undisputedly well-known. Indeed,
`
`humanshave always performed these functions.”). This recitation of generic
`
`computer memories and data types, being used in the conventional manner,
`
`is insufficient to confer the specificity required to elevate the nature of the
`
`claim into a patent-eligible application. Alice, 134 S. Ct. at 2355 (quoting
`
`Mayo, 132 S. Ct. at 1294) (“We have described step two of this analysis as a
`
`search for an ‘inventive concept’—i.e., an element or combination of
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`Patent 7,942,317 B2
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`elements that is ‘sufficient to ensure that the patent in practice amounts to
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`significantly more than a patent uponthe [ineligible concept]itself.”””)
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`(brackets in original); Affinity Labs, No. 2015-2080,slip op. 10-11 (“The
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`claims thus do not go beyond‘stating [the relevant] functions in general
`
`terms, without limiting them to technical means for performing the functions
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`that are arguably an advance over conventional computer and network
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`technology.””).
`
`In addition, because the recited elements can be implemented on a
`
`general purpose computer, the challenged claims do not cover a “particular
`
`machine.” Pet. 72-73; see Bilski, 561 U.S. at 6040S (stating that machine-
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`or-transformation test remains “a useful and important clue” for determining
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`whetheran invention is patent eligible). And the challenged claims do not
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`transform an article into a different state or thing. Pet. 73.
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`Thus, we determine, the potentially technical elements of the
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`challenged claims are nothing more than “generic computer
`
`implementations” and perform functions that are “purely conventional.”
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`Alice, 134 S. Ct. at 2358-59; Mayo, 132 S. Ct. at 1294.
`
`b. DDR Holdings
`
`Relying on the Federal Circuit’s decision in DDR Holdings, Patent
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`Ownerasserts that the challenged claimsare directed to statutory subject
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`matter because the claimed solution is “‘necessarily rooted in computer
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`technology in order to overcomea problem specifically arising in the realm
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`of computer networks.’” PO Resp. 2—3, 30 (quoting DDR Holdings, LLCv.
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`Hotels.com, L.P., 773 F.3d 1245, 1257 (Fed. Cir. 2014)). Patent Owner
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`contends that
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`By using a system that combines on the data carrier both the
`digital content and the payment data and/or access rule data,
`access control to the digital content can be continuously enforced
`prior to access to the digital content. By comparison, unlike a
`system that uses use rules/use status data as claimed, when a
`DVD was physically rented for a rental period, there was no
`mechanism to write partial use status data to the DVD when only
`part ofthe DVD hadbeen accessed(e.g., to track whether a renter
`had “finished with” the DVD yet).
`
`Id. at 19.
`
`Petitioner respondsthat the challenged claims are distinguishable
`
`from the claims in DDR Holdings. Pet. Reply 13-16. The DDR Holdings
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`patent is directed at retaining website visitors when clicking on an
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`advertisement hyperlink within a host website. 773 F.3d at 1257.
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`Conventionally, clicking on an advertisement hyperlink would transport a
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`visitor from the host’s website to a third party website. Jd. The Federal
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`Circuit distinguished this Internet-centric problem over“the ‘brick and
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`mortar’ context” because “{t]here is .
`
`. .no possibility that by walking up to
`
`[a kiosk in a warehousestore], the customerwill be suddenly and completely
`
`transported outside the warehousestore and relocated to a separate physical
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`venue associated with the third party.” Jd. at 1258. The Federal Circuit
`
`further determined that the DDR Holdings claimsspecify “how interactions
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`with the Internet are manipulated to yield a desired result—a result that
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`overrides the routine and conventional sequenceofevents ordinarily
`
`triggered by the click of a hyperlink.” Jd. The unconventionalresult in
`
`DDR Holdingsis the website visitor is retained on the host website, butstill
`
`is able to purchase a product from a third-party merchant. Jd. at 1257-58.
`
`The limitation referred to by the Federal Circuit in DDR Holdings recites
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`“using the data retrieved, automatically generate and transmit to the web
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`browser a second web pagethat displays: (A) information associated with
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`the commerceobject associated with the link that has been activated, and
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`(B) the plurality of visually perceptible elements visually corresponding to
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`the source page.” Jd. at 1250. Importantly, the Federal Circuit identified
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`this limitation as differentiating the DDR Holdings claims from thoseheld to
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`be unpatentable in Ultramercial, which “broadly and generically claim “use
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`of the Internet’ to perform an abstract business practice (with insignificant
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`addedactivity).” Jd. at 1258.
`Weagreethat the challenged claimsare distinguishable from the
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`claimsat issue in DDR Holdings. As aninitial matter, we are not persuaded
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`by Patent Owner’s argumentthat the challenged claimsare “rooted in
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`computer technology in order to overcome a problem specifically arising in
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`the realm of computer networks”—that of“data content piracy’—{PO Resp.
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`30-31), and address the “technological problemscreated by the nature of
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`digital content and the Internet” (id. at 29). Data piracy exists in contexts
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`other than the Internet. See Pet. Reply 13 (identifying other contexts in
`which data piracy is a problem). For example, data piracy existed in the
`
`contexts of compact discs and DV
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