throbber
us to. 0V
`Trials
`Tel: 571-272-7822
`
`Paper 8
`Entered: November 16, 2015
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`APPLE INC.,
`
`Petitioner,
`
`V.
`
`SMARTFLASH LLC,
`Patent Owner.
`
`Case CBM2015-00131
`
`Patent 8,061,598 B2
`
`Before JENNIFER S. BISK, RAMA G. ELLURU,
`
`JEREMY M. PLENZLER, and MATTHEW R. CLEIVIENTS
`
`Administrative Patent Judges.
`
`CLEMENTS, Administrative Patent Judge.
`
`Institution of Covered Business Method Patent Review
`
`DECISION
`
`37 C.F.R. § 42.208
`
`

`

`CBM2015-00131
`
`Patent 8,061,598 B2
`
`A. Background
`
`INTRODUCTION
`
`Petitioner, Apple Inc. (“Petitioner”), filed a Petition to institute
`
`covered business method patent review of claims 3—6, 8—14, 16—30, and 32—
`
`41 of US. Patent No. 8,061,598 B2 (Ex. 1001, “the ’598 patent”) pursuant
`
`to § 18 of the Leahy-Smith America Invents Act (“AIA”). Paper 1 (“Pet”).1
`
`Smartflash LLC (“Patent Owner”) filed a Preliminary Response. Paper 6
`
`(“Prelim. Resp”).
`
`We have jurisdiction under 35 U.S.C. § 324(a), which provides that a
`
`covered business method patent review may not be instituted “unless .
`
`.
`
`. it is
`
`more likely than not that at least 1 of the claims challenged in the petition is
`
`unpatentable.”
`
`After considering the Petition and Preliminary Response, we
`determine that the ’598 patent is a covered business method patent. We
`
`further determine that Petitioner has demonstrated that it is more likely than
`
`not that the challenged claims are unpatentable. We further determine that
`
`Apple is estopped from challenging claim 26 in this proceeding.
`
`Accordingly, we institute a covered business method patent review of claims
`
`3—6, 8—14, 16—25, 27-30, and 32—41 (the “challenged claims”), but not of
`
`claim 26 of the ’598 patent, as discussed below.
`
`B. Asserted Ground
`
`Petitioner contends that claims 3—6, 8—14, 16—30, and 32—41 are
`
`unpatentab‘le under 35 U.S.C. § 101 as being directed to patent-ineligible
`
`1 Pub. L. No. 112—29, 125 Stat. 284, 296—07 (2011).
`
`

`

`CBM2015-00131
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`Patent 8,061,598 B2
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`subject matter. Pet. 1. Petitioner provides a declaration from John R].
`
`Kelly, Ph.D. to support its challenges. Ex. 1019 (“the Kelly Declaration”).
`
`C. Related Matters
`
`The parties indicate that the ’598 patent is the subject of the following
`
`district court cases: Smart/lash LLC v. Apple Inc., Case No. 6:15-cv-145
`
`(ED. Tex.); Smart/lash LLC v. Google, Inc., Case No. 6:14-cv-435 (ED.
`
`‘ Tex); Smartflash LLC v. Apple Inc., Case No. 6:13-cv-447 (ED. Tex.);
`
`Smartflaslz LLC v.’ Samsung Electronics Co. Ltd, Case No. 6:13-cv-448
`
`(ED. Tex.); and Smartflash LLC v. Amazon. Com, Inc., Case No. 6: 14-cv-
`
`992 (ED. Tex.). Pet. 37; Paper 5, 4—5.
`
`Petitioner previously has filed three petitions requesting covered
`
`business method patent review of the ’598 patent: CBM2014-00108;
`
`CBM2014-00109 (consolidated with CBM2014-00108); and CBM2015-
`
`00017. Pet. 37. A final written decision has issued in CBM2015-00108,
`
`determining claim 26 of the ’598 patent is unpatentable pursuant to 35
`
`U.S.C. § 103. Apple Inc. v. Smartflash LLC, Case CBM2014-00108, slip op.
`
`at 25 (PTAB Sept. 25, 2015) (Paper 50). Trial was instituted in CBM2015-
`
`00017 with respect to claims 1, 2, 15, and 31 under 35 U.S.C. § 101. Apple
`
`Inc. v. Smartflash LLC, Case CBM2015-00017, slip op. at 20 (PTAB Apr.
`
`10, 2015) (Paper 22).
`
`Apple and other Petitioners have filed additional petitions requesting
`
`covered business method patent reviews of related patents. See Pet. 38;
`
`Paper 5, 2—4.
`
`D. The ’598 Patent
`
`The ’598 patent relates to “a portable data carrier for storing and
`
`paying for data and to computer systems for providing access to data to be
`
`

`

`CBM2015—00131
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`Patent 8,061,598 B2
`
`stored,” and the “corresponding methods and computer programs.”
`
`Ex. 1001, 1:21—25. 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 intemet without authorization. Id. at
`
`1:29—55. The ’598 patent describes providing portable data storage together
`
`with a means for conditioning access to that data upon validated payment.
`
`Id. at 1:59—2:11. This combination allows data owners to make their data
`
`available over the intemet without fear of data pirates. Id. at 2:11—15.
`
`As described, the portable data storage device is connected to a
`
`terminal for intemet access. Id. at 1:59—67. The terminal reads payment
`
`information, validates that information, and downloads data into the portable
`
`storage device from a data supplier. Id. The data on the portable storage
`
`device can be retrieved and output from a mobile device. Id. at 2: 1—5. The
`
`’598 patent makes clear that the actual implementation of these components
`
`is 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”).
`
`E. Illustrative Claim
`
`Petitioner challenges claims 3—6, 8—14, 16—30, and 32—41 of the ’598
`patent. Claims 18, 2.1, 26, 27, 29, 35, 39, 40, and 41 are independent.
`
`Claims 3—6, 8—14, 16, and 17 depend directly or indirectly from claim 1.
`
`Claims 19 and 20 depend from claim 18. Claims 22—-25 depend directly or
`
`indirectly from claim 21. Claim 28 depends from claim 27. Claim 30
`
`depends from claim 29. Claims 32—34 depend directly or indirectly from
`
`

`

`CBM2015-00131
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`Patent 8,061,598 B2
`
`claim 31. Claims 36—38 depend from claim 35. Claim 8 is illustrative of the
`
`claimed subject matter and is reproduced below:
`
`1.
`
`A portable data carrier comprising:
`
`an interface for reading and writing data from and to the
`portable data carrier;
`
`content data memory, coupled to the interface, for storing one
`or more content data items on the carrier;
`
`use rule memory to store one or more use rules for said one or
`more content data items;
`
`a program store storing code implementable by a processor; and
`
`a processor coupled to the content data memory, the use rule
`memory, the interface and to the program store for implementing code
`in the program store,
`
`wherein the code comprises code for storing at least one content
`data item in the content data memory and at least one use rule in the
`use rule memory.
`
`Ex. 1001, 25:54—67.
`
`A portable data carrier as claimed in claim 1, further
`7.
`comprising payment data memory to store payment data and code to
`provide the payment data to a payment validation system.
`
`Ex. 1001 , 26:25-28.
`
`A portable data carrier as claimed in claim 7, wherein code
`8.
`to provide payment to the payment validation system comprises
`code to provide the identification data identifying the user of the
`portable data carrier to the payment validation system.
`
`Ex. 1001, 26:29—33.
`
`ANALYSIS
`
`A. Estoppel
`
`35 U.S.C. § 325(c)(1) mandates that
`
`[t]he petitioner in a post-grant review of a claim in a patent
`under this chapter that results in a final written decision under
`section 328(a) or the real party in interest or privy of the
`
`

`

`CBM2015-00131
`
`Patent 8,061,598 B2
`
`petitioner, may not request or maintain a proceeding before the
`Office with respect
`to that claim on any ground that
`the
`petitioner raised or reasonably could have raised during that
`post-grant review.
`
`As noted above, we issued a final written decision in CBM2014-
`
`00108, determining that claim 26 of the ’598 patent is unpatentable pursuant
`
`to 35 U.S.C. § 103. Apple Inc. v. Smartflash LLC, Case CBM2014-00108,
`
`Slip Op. at 25 (PTAB Sept. 25, 2015) (Paper 50). Apple was the petitioner
`
`in CBM2014-00108, which resulted in a final written decision with respect ;
`
`to claim 26. Thus, pursuant to § 325(e)(1), Apple cannot “request or
`
`maintain” a proceeding before the Office with respect to [this claim] “on any
`
`ground” that Apple “raised or reasonably could have raised”-during
`
`CBM2014-00108.
`
`Apple is estopped from maintaining a proceeding with respect to
`
`claim 26 based on § 101. Section 325(c)(1) estops Apple from filing or
`
`maintaining a proceeding before the Office with respect to the claim at issue
`
`on “any ground that [Apple] raised or reasonably could have raised.”
`(Emphasis added). The Supreme Court issued its decision in Alice Corp.
`
`Pty. Ltd. v. CLS Bank Int ’1, 134 S. Ct. 2347 (2014) afier Apple filed its
`
`petition in CBM2014-00108. Section 325(e)(1), however, does not make
`
`exceptions for intervening case law that clarifies jurisprudence. Here, Apple
`
`“reasonably could have raised” a challenge to claim 26 of the ’598 patent
`
`based on § 101 in its CBM2014-00108/CBM2014-00109 petitions. Thus,
`
`§ 325(c)(1) is applicable to this claim.
`
`Because Apple is estopped from maintaining a proceeding with
`
`respect to claim 26 based on any ground it “reasonably could have raised” in
`
`

`

`CBM2015—00131
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`Patent 8,061,598 B2
`
`its earlier petitions, we deny a covered business method patent review of
`
`claim 26 pursuant to § 101 in the present proceeding.
`
`B. Claim Construction
`
`In a covered business method patent review, claim terms are given
`
`their broadest reasonable interpretation in light of the specification in which
`
`they appear and the understanding of others skilled in the relevant art. See
`
`37 CPR. § 42.300(b). Applying that standard, we interpret the claim terms
`
`of the ’598 patent according to their ordinary and customary meaning in 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
`
`determine that “payment data” is the only term requiring an express
`
`construction in order to conduct properly our analysis.
`
`Apple asserts that “[flor review purposes, [payment data] should be
`
`construed to mean ‘data representing payment made for reduested content
`
`data’ and is distinct from ‘access control data.’” Pet. 41.
`
`The plain and ordinary meaning of the two words that make up the
`
`term—“payment” and “data”—do not incorporate any notion of time and
`
`nothing about their combination changes that determination. As used in the
`
`’598 patent, “payment data” encompasses data relating to future, current,
`
`and past payments. For example, the ’598 patent states that “payment data
`
`for making a payment to the system owner is received from the smart Flash
`
`card by the content access terminal and forwarded to an e-payment system.”
`
`1001, 20:59—62. This language indicates that payment data exists prior to
`the payment being made for the requested content. The ’598 patent also
`explains that “payment data received may either be data relating to an actual
`
`payment made to the data supplier, or it may be a record of a payment made
`
`

`

`CBM2015-00131
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`Patent 8,061,598 B2
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`to an e-payment system.” Id. at 6:60—63. This indicates that “payment
`
`data,” includes data for payments that have already been made.
`Moreover, the plain and ordinary meaning of data does not implicate
`
`changes in character based on when it is used in a transaction. For example,
`
`a credit card number may qualify as “data relating to payment” before the
`
`number is processed, while the number is being processed, and after the
`
`number is processed. See Ex. 1014, 232: 14—24 (providing credit or debit
`
`card information to a retail terminal). Thus, without an express description
`
`to the contrary, we presume that “payment data” retains the same meaning
`
`before, during, and after the payment operation. Neither party points to any
`
`such contrary description. In fact, the ’598 patent describes “payment data”
`
`in several instances as data relating to payment for the requested data item.
`
`Ex. 1001, 1028—9, 10:28—30, 10:48—49.
`
`For purposes of this decision, we determine that the broadest
`
`reasonable interpretation of “payment data” as used in the ’598 patent is
`
`“data relating to payment for the requested data item.”
`
`C. Covered Business Method Patent
`
`Section 18 of the AIA provides for the creation of a transitional
`
`program for reviewing covered business method patents. A “covered
`
`business method patent” is a patent that “claims a method or corresponding
`
`apparatus for performing data processing or other operations used in the
`practice, administration, or management of a financial product or service,
`
`except that the term does not include patents for technological inventions.”
`
`AIA § 18(d)(1); see 37 CPR. § 42.301(a). A patent need have only one
`
`claim directed to a covered business method to be eligible for review. See
`
`Transitional Program for Covered Business Method Patents—Definitions of
`
`

`

`CBM2015-00131
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`Patent 8,061,598 B2
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`Covered Business Method Patent and Technological Invention; Final Rule,
`
`77 Fed. Reg. 48,734, 48,736 (Aug. 14, 2012) (“CBM Rules”) (Comment 8).
`
`We previously have determined that the ’598 patent is a “covered
`business method patent.” See, e.g., CBM2014-00108, Paper 8, 7—12
`‘
`
`(determining that the ’598 patent is eligible for covered business method
`
`patent reviewed based on claim 7). In this case, Apple asserts that claim 8
`
`qualifies the ’598 patent for covered business method patent review. Pet. 23.
`
`1. Financial Product or Service
`
`Petitioner asserts that claim 8 “clearly concerns a system
`
`(corresponding to the methods discussed and claimed elsewhere) for
`
`performing data processing and other operations used in the practice,
`
`administration, or management of a financial activity and service.” Pet. 27.
`
`Based on this record, we agree with Petitioner that the subject matter recited
`
`by claim 8 is directed to activities that are financial in nature, namely data
`
`access conditioned on payment validation. Claim 8 (through its dependence
`
`from claim 7) requires “code to provide payment data to a payment
`
`validation system” and further comprises “code to provide the identification
`
`~ data identifying the user of the portable data carrier to the payment
`
`validation system.” The transfer of data relating to payment and providing
`
`data in response to data relating to payment are financial activities, and
`providing for such transfers amounts to a financial service. This is
`
`consistent with the Specification of the ’598 patent, which confirms claim
`
`8’s connection to financial activities by stating that the invention “relates to
`
`a portable data carrier for storing and paying for data.” Ex. 1001, 1:21—23.
`
`Patent Owner disagrees that claim 8 satisfies the financial in nature
`
`requirement of AIA § 18(d)(1), arguing that that section should be
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`

`

`CBM2015-00131
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`Patent 8,061,598 B2
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`interpreted narrowly to cover only technology used specifically in the
`
`financial or banking industry. Prelim. Resp. 35—40. Patent Owner cites to
`
`various portions of the legislative history as support for its proposed
`
`interpretation. Id.
`
`The Federal Circuit has expressly determined, however, that “the
`
`definition of ‘covered business method patent’ is not limited to products and
`
`services of only the financial industry, or to patents owned by or directly
`
`affecting the activities of financial institutions, such as banks and brokerage
`
`houses.” Versata Dev. Grp., Inc. v. SAP America, Inc., 793 F.3d 1306, 1325
`
`(Fed. Cir. 2015). Rather, “it covers a wide range of finance-related
`
`activities.” Id. Further, contrary to Patent Owner’s view of the legislative
`
`history, the legislative history overall indicates that the phrase “financial
`
`product or service” is not limited to the products or services of the “financial
`
`services industry” and is to be interpreted broadly. CBM Rules, 77 Fed.
`
`Reg. at 48,73 5—36. For example, the “legislative history explains that the
`
`definition of covered business method patent was drafted to encompass
`patents ‘claiming activities that are financial in nature, incidental to a
`financial activity or complementary to a financial activity.”’ Id. (citing 157
`
`Cong. Rec. S5432 (daily ed. Sept. 8, 2011) (statement of Sen. Schumer)).
`
`In addition, Patent Owner asserts that claim 8 is not directed to an
`
`apparatus or method that is financial in nature because claim 8 “omits the
`
`specifics of how payment is made.” Prelim. Resp. 39. We are not ~
`
`persuaded by this argument because § 18(d)(1) of the AIA does not include
`
`such a requirement, nor does Patent Owner point to any other authority that
`
`makes such a requirement. Id. We determine that because claim 8 recites
`
`10
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`

`

`CBM2015-0013l
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`Patent 8,061,598 B2
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`“payment,” as Patent Owner acknowledges (id. ), the financial in nature
`
`requirement of § 18(d)( 1) is satisfied.
`
`For the reasons stated above, and based on the particular facts of this
`
`proceeding, we conclude that the ’598 patent includes at least one claim that
`meets the financial in nature requirement of § 18(d)(1) of the AIA.
`
`2. Exclusion for Technological Inventions
`
`Petitioner asserts that claim 8 does not fall within § 18(d)(1)’s
`
`exclusion for “technological inventions.” Pet. 30—36. In particular,
`
`Petitioner argues that claim 8 “does not claim ‘subject matter as a whole
`
`[that] recites a technological feature that is novel and unobvious over the
`
`prior art[] and solves a technical problem using a technical solution.”’
`
`Pet. 27 (quoting 37 CPR. § 42.301(b)).
`
`We are persuaded that claim 8 as a whole does not recite a
`
`technological feature that is novel and unobvious over the prior art. The
`
`’598 patent makes clear that the asserted novelty of the invention is not in
`
`any specific improvement of software or hardware, but in the method of
`
`controlling access to data. For example, the ’598 patent states that “there is
`an urgent need to find a way to address the problem of data piracy” (Ex.
`
`1001, 1:52—55), while acknowledging that the “physical embodiment of the
`
`system is not critical and a skilled person will understand that the terminals,
`
`data processing systems and the like can all take a variety of forms” (id. at
`
`12:29—32). For example, the ’598 patent provides the example of a “smart
`
`Flash card” for a data carrier, referring to “the ISO (International Standards
`
`Organization) series of standards, including ISO 7810, ISO 7811, ISO 7812,
`
`ISO 7813, ISO 7816, ISO 9992 and ISO 10102” (id. at 1726—8, 11—15) for
`
`further details on smart cards. Thus, we determine that claim 8 recites
`
`11
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`

`CBM2015-00131
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`Patent 8,061,598 B2
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`merely known technological features, which indicates that it is not a patent
`
`for a technological invention. See Office Patent Trial Practice Guide, 77
`
`Fed. Reg. 48,756, 48,764 (Aug. 14, 2012).
`
`Patent Owner also argues that claim 8 falls within § 18(d)(1)’s
`
`exclusion for “technological inventions” because it is directed towards
`
`solving the technological problem of “storing at least one content data item
`
`in the content data memory and at least one use rule in the use rule memory”
`
`with the technological solution of “‘code for storing at least one content data
`
`item in the content data memory and at least one use rule in the use ru1e
`
`memory.’” Prelim. Resp. 40—41 (quoting claim 8). We are not persuaded
`
`by this argument because, as Petitioner argues, the problem being solved by
`
`claim 8 is a business problem—data piracy. Pet. 34. For example, the
`
`Specification states that “[b]inding the data access and payment together
`
`allows the legitimate owners of the data to make the data available
`
`themselves over the intemet without fear of loss of revenue, thus
`
`undermining the position of data pirates.” Ex. 1001, 2: 1 1—15. Therefore,
`
`based on the particular facts of this proceeding, we conclude that claim 8
`
`does not recite a technological invention.
`
`3. Conclusion
`
`In View of the foregoing, we conclude that the ’598 patent is a covered
`
`business method patent under AIA § 18(d)(1) and is eligible for review
`
`under the transitional covered business method patent program.
`
`D. Section 101 Patent-Eligible Subject Matter
`
`Petitioner challenges claims 3—6, 8—14, 16—25, 27—30, and 32—41 as
`
`directed to patent-ineligible subject matter under 35 U.S.C. § 101. Pet. 43—
`
`79. Petitioner asserts that the challenged claims are directed to an abstract
`
`12
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`CBM2015-00131
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`Patent 8,061,598 B2
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`idea without additional elements that transform it into a patent-eligible
`
`application of that idea (id. at 45—75), triggers preemption concerns (id. at
`
`76—78), and fails the machine-or-transformation test (id. at 78—79).
`
`Patent Owner disagrees, arguing that the limitations of each of the
`
`challenged claims, taken as a combination, “recite specific ways of using
`
`. distinct memories, data types, and use rules that amount[s] to significantly
`
`more than the underlying abstract idea” (Prelim. Resp. 14 (quoting Ex.
`
`2049, 19)), and that the claims do not result in inappropriate preemption (id.
`
`at 15—26). Patent Owner also asserts that (1) section 101 is not a ground
`
`that may be raised in a covered business method patent review (id. at 30—
`
`32); (2) the Office is estopped from revisiting the issue of § 101, which was
`
`inherentlyreviewed during examination (id. at 32—33); and (3) invalidating
`
`patent claims via covered business method patent review is unconstitutional
`
`(id. at 33—34).
`
`1. Abstract Idea
`
`Under 35 U.S.C. § 101, we must first 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—14 (Fed. Cir.
`
`2014). Here, each of the challenged claims recites either a “machine”——i.e.,
`
`a “portable data carrier” (claims 3—6, 8—14, 16—25, 27—30) or a “data access
`
`terminal” (claims 39—41)—or a “process,”—i.e., a “method” (claims 32—
`
`38)—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, 134 S.Ct. at 2354 (2014)
`
`(citing Assoc. for Molecular Pathology v. Myriad Genetics, Inc, 133 S.Ct.
`
`13
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`2107, 2116 (2013) (internal quotation marks and brackets omitted». In
`
`Alice, the Supreme Court reiterated the framework set forth previously in
`
`Mayo Collaborative Services v. Prometheus Laboratories, 132 S.Ct. 1289,
`
`1293 (2012) “for distinguishing patents that claim laws of nature, natural
`
`phenomena, and abstract ideas from those that claim patent-eligible
`
`applications of these concepts.” Alice, 134 S.Ct. at 2355. The first step in
`
`the analysis is to “determine whether the claims at issue are directed to one
`
`of those patent-ineligible concepts.” Id.
`
`Petitioner argues that the challenged claims are directed to the abstract
`
`idea of “payment for and/or controlling access to data.” Pet. 45. Patent
`
`Owner does not dispute that the challenged claims are directed to an abstract
`
`idea. See Prelim. Resp. 11—26.
`
`We are persuaded that the challenged claims are more likely than not
`
`drawn to a patent-ineligible abstract idea. As discussed above, the ’598
`
`patent discusses addressing recording industry concerns of data pirates
`
`offering unauthorized access to widely available compressed audio
`
`recordings. BX. 1001, 1:20—55. The ’598 patent proposes to solve this
`
`problem by restricting access to data on a device based upon satisfaction of
`
`use rules linked to payment data. Id. at 927—25. The ’598 patent makes clear
`
`that the heart of the claimed subject matter is restricting access to stored data
`
`based on supplier-defined access rules and payment data. Id. at 1:59—2:15,
`
`Abstract. We are, thus, persuaded, on this record, that the claimed subject
`
`matter is 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
`
`14
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`CBM2015-0013l
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`Patent 8,061,598 B2
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`system claim to be “generating tasks [based on] rules .
`
`.
`
`. to be completed
`
`upon the occurrence of an event”).
`
`2. Inventive Concept
`
`Turning to the second step of the analysis, we look for additional
`
`elements that can “transform the nature of the claim” into a patent-eligible
`
`application of an abstract idea. Mayo, 132 S.Ct. at 1297. On this record, we
`
`are not persuaded that the challenged claims of the ’598 patent add an
`
`inventive concept sufficient to ensure that the patent in practice amounts to
`
`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 1345 (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).
`
`Patent Owner argues that the challenged claims are patentable because
`
`they “recite specific ways of using distinct memories, data types, and use
`
`rules that amount[s] to, significantly more than the underlying abstract idea.”
`
`Prelim. Resp. 14 (quoting Ex. 2049, 19). Patent Owner, however, does not
`
`elaborate as to how these claim limitations amount to significantly more than
`
`the underlying abstract idea.
`
`The Specification, as discussed above, treats as well—known all
`
`potentially technical aspects of the claim, including “program store” and
`
`“payment validation system” limitations recited in the challenged claims.
`
`For example, the Specification states that the payment validation system
`
`“may be part of the data supplier’s computer systems or it may be a separate
`
`system such as an e-payment system.” Ex. 1001, 8:23—25; see id. at 8:63—
`
`65. Further, with respect to the recited program store, the Specification
`
`15
`
`

`

`CBM2015-00131
`
`Patent 8,061,598 B2
`
`discloses that “[t]he data storage means is based on a standard smart card.”
`
`Id. at 11:28—29; 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 even be at physically remote
`
`locations from processors 128-134 and coupled to these processors via
`
`intemet 142.”), Fig. 6. The use of a program store and the linkage of
`
`existing hardware devices to existing payment validation processes 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.
`
`Patent Owner also asserts that the challenged claims are like those in
`
`DDR Holdings, which the Federal Circuit held were directed to statutory
`
`subject matter because “‘the claimed solution is necessarily rooted in
`
`computer technology in order to overcome a problem specifically arising in
`
`the realm of computer networks.”’ Prelim. Resp. 13 (quoting DDR
`
`Holdings, LLC v. Hotels. Com, LP., 773 F.3d 1245, 1257 (Fed. Cir. 2014)).
`
`According to Patent Owner, the challenged claims are “rooted in computer
`
`technology in order to overcome a problem specifically arising in the realm
`3, G“
`
`of computer networks—that of digital data piracy,
`a challenge particular
`to the Intemet.”’ Prelim. Resp. 13 (quoting DDR Holdings, 773 F.3d at
`1257)
`'
`
`We are not persuaded that the challenged claims are like those at issue
`
`in DDR Holdings. In DDR Holdings, the Federal Circuit found that the
`
`challenged claims were directed to patentable subject matter because they
`
`“specif[ied] how interactions with the Internet are manipulated to yield a
`
`desired result—a result that overrides the routine and conventional aspects
`
`of the technology.” 773 F.3d at 1258. We are not persuaded that the
`
`16
`
`

`

`CBM2015-00131
`
`Patent 8,061,598 B2
`
`challenged claims specify interactions that depart from the routine use of the
`
`recited devices. Instead, we determine, based on the current record, that the
`
`claims merely apply conventional computer processes to restrict access to
`
`data based on payment.
`
`The differences between the challenged claims and those at issue in
`
`DDR Holdings are made clear by comparing the challenged claims of the
`
`’598 patent to claim 19 of the patent at issue in DDR Holdings. For
`
`example, claim 2 of the ’598 patent recites “code to provide access to the at
`
`least one content data item in accordance with the at least one use rule.”
`
`There is no language in this claim, in any of the other challenged claims, or
`
`in the specification of the ’598 patent, that demonstrates that the generic
`
`computer components—“code to provide access” and “content data item”
`
`and “use rule”—function in an unconventional manner or employ
`
`sufficiently specific programming. Instead, the “code to provide access,”
`
`“content data item,” and “use rule” limitations, for example, like all the other
`
`limitations of the challenged claims, are “specified at a high level of
`
`generality,” which the Federal Circuit has found to be “insufficient to supply
`
`an inventive concept.” Ultramercial, 772 F.3d at 716.
`
`In DDR Holdings, exemplary claim 19 recites “using the data
`
`retrieved, automatically generate and transmit to the web browser a second
`
`web page that displays: (A) information associated with the commerce
`
`object associated with the link that has been activated, and (B) the plurality
`
`of visually perceptible elements visually corresponding to the source page.”
`
`Prelim. Resp. 12. It was this limitation from claim 19 in DDR Holdings,
`
`according to the Federal Circuit, that specifies “how interactions with the
`
`Internet are manipulated to yield a desired result—a result that overrides the
`
`17
`
`

`

`CBM2015-00131
`
`Patent 8,061,598 B2
`
`routine and conventional sequence of events ordinarily triggered by the click
`
`of a hyperlink.” 773 F.3d at 1258. Importantly, the Federal Circuit
`
`identified this limitation as differentiating the DDR Holdings claims from
`
`those held to be unpatentable in Ultramercial, which “broadly and
`
`generically claim ‘use of the Internet’ to perform an abstract business
`
`practice (with insignificant added activity).” Id. We are persuaded, at this
`
`point in the proceeding, that the challenged claims are closer to the claims at
`
`issue in Ultramercial than to those at issue in DDR Holdings. The claims at
`
`issue in Ultramercial, like the challenged claims of the ’598 patent, were
`
`also directed to a method for distributing media products. Similar to
`
`restricting data based on payment, as in the challenged claims, the
`
`Ultramercial claims restricted access based on viewing an advertisement.
`
`Ultramercial, 772 F.3d at 712.
`
`Thus, on this record, we are persuaded that Apple has shown that it is
`
`more likely than not that the challenged claims—claims 3—6, 8—14, 16—25;
`
`27—30, and 32—41—of the ’598 patent do not add an inventive concept
`
`sufficient to ensure that the patent in practice amounts to significantly more
`
`than a patent on the abstract idea itself. Alice, 134 S.Ct. at 2355; see also
`
`Accenture, 728 F.3d at 1345 (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).
`
`3. Preemption
`
`Petitioner argues that “the challenged claims’ attempt to achieve
`
`broad functional coverage—with no relative contribution from the named
`
`inventors—firmly triggers preemption concerns.” Pet. 76. Patent Owner
`
`18
`
`

`

`CBM2015-00131
`
`Patent 8,061,598 B2
`
`responds that the challenged claims do not result in inappropriate
`
`preemption. Prelim. Resp. 15—26. According to Patent Owner, the
`
`challenged claims of the ’598 patent recite “specific ways of managing
`
`access to digital content data based on payment validation through storage
`
`and retrieval of use status data and use rules in distinct memory types and
`
`evaluating the use data according to use rules.” Id. at 18 (quoting Ex. 2049,
`
`20). Patent Owner also asserts that the existence of a large number of non-
`
`infringing alternatives shows that the claims of the ’598 patent do not raise
`
`preemption concerns. Id. at 21—26.
`
`Patent OWner’s preemption argument does not alter our § 101
`
`analysis. The Supreme Court has described the “pre-emption concern” as
`
`“undergird[ing] our§ 101 jurisprudence.” Alice, 134 S.Ct. at 2358. The
`
`concern “is a relative one: how much future innovation is foreclosed relative
`
`to the contribution of the inventor.” Mayo, 132 S.Ct. at 1303. “While
`
`preemption may signal patent ineligible subject matter, the absence of
`
`complete preemption does not demonstrate patent eligibility.” Ariosa
`
`Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir. 2015).
`
`Importantly, the preemption concern is addressed by the two part test
`
`considered above. After all, every patent “forecloses
`
`future invention” to
`
`some extent, Mayo, 132 S.Ct. at 1292, and, conversely, every claim
`
`limitation beyond those that recite the abstract id

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