Trials
`
`us to. ov
`
`~
`
`, Tel: 571-272-7822
`
`-
`
`V
`
`Paper 8 (CBM2014-00108)
`Paper 8(CBM2014-00109) '
`Entered: September 30, 2014
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`APPLE INC.,
`
`Petitioner,
`
`V.
`
`SMARTFLASH LLC,
`Patent Owner.
`
`Case CBM2014-00108
`
`Case CBM2014-00109
`
`Patent 8,061,598
`
`Before IENNIFER S. BISK, RAMA G. ELLURU, NEIL T. POWELL,
`
`JEREMY M. PLENZLER, and MATTHEW R. CLEIVHENTS,
`Administrative Parent Judges.
`
`, CLEMENTS, Administrative Patent Judge;
`
`DECISION
`
`Institution of Covered Business Method Patent Review
`
`37 C.F.R. § 42.208
`
`
`
`us to. ov
`
`~
`
`, Tel: 571-272-7822
`
`-
`
`V
`
`Paper 8 (CBM2014-00108)
`Paper 8(CBM2014-00109) '
`Entered: September 30, 2014
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`APPLE INC.,
`
`Petitioner,
`
`V.
`
`SMARTFLASH LLC,
`Patent Owner.
`
`Case CBM2014-00108
`
`Case CBM2014-00109
`
`Patent 8,061,598
`
`Before IENNIFER S. BISK, RAMA G. ELLURU, NEIL T. POWELL,
`
`JEREMY M. PLENZLER, and MATTHEW R. CLEIVHENTS,
`Administrative Parent Judges.
`
`, CLEMENTS, Administrative Patent Judge;
`
`DECISION
`
`Institution of Covered Business Method Patent Review
`
`37 C.F.R. § 42.208
`
`
`
`CBM2014-00108Vand CBM2014-00109
`Patent 8,061,598
`
`INTRODUCTION
`
`A. Background
`
`Petitioner, Apple Inc. (“Apple”), filed a Petition in CBM2014—00108
`
`. (Paper 2, “108 Pet.”) to institute a covered business method patent review of
`
`claims 1, 2, 7, 13,15, 26, and 31 (the “challenged claims”) of US. Patent
`No. 8,061,598 (Ex. 1001, “the ’598 patent”) pursuant to § 18 of the Leahy-
`Smith America Invents Act (“AIA”).l Apple also filed a Petition in
`A
`CBM2014-00109 (Paper 2, “109 Pet”) to institute a covered business
`
`method patent review of the challenged claims of the ’598 patent.
`
`Patent Owner, Smartflash LLC (“Smartflash”), filed a Preliminary
`
`Response in CBM2014—00108 (Paper 6, “108 Prelim. Resp”) and in
`
`CBM2014-00109 (Paper 6, “109 Prelim. Resp”).
`
`We have jurisdiction under35 U.S.C. § 324, 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.” ‘
`
`' B. Asserted Grounds
`
`Apple contends that the challenged claims are unpatentable under
`35 U.S.C. §§ 102 and/or 103 based on the following grounds (108 Pet. 26—
`
`75; 109 Pet. 29—78).
`
`'
`
`1 Patent Owner argues that the multiple petitions filed against the ’598 patent
`violate the page limit requirement of 37 C.F.R. § 42.24(a)(iii), but does not
`cite any authority-to support its position. 108 Prelim. Resp. 11-13; 109
`Prelim. Resp. 11-13. The page limit for petitions requesting covered
`business method patent review is 80 pages (37 CPR. § 42.24(a)(iii)), and
`each of the 108 and 109 Petitions is within that requirement.
`
`
`
`CBM2014-00108 and CBM2014-00109
`
`‘ Patent 8,061,598
`
`
`
`Stefik ’235 and Stefik ’980
`
`Stefik ’235, Stefik ’980, and Poggio
`
`
`
`Stefik ’23s, Stefik ’980, and Sato
` Stefik ’235, Stefik ’980, and
`
`Rydbeck
`
`
`
`
`
`
`
`
`CBM2014-00109
`
`
`
`2US. Patent No. 5,530,235 (Ex. 1013) (“Stefik ’235”); US. Patent No.
`5,629,980 (Ex. 1014) (“Stefik ’980”); US. Patent No. 5,915,019 (Ex. 1015)
`(“Ginter”); European Patent Application, Publication No. EP0809221A2
`(translation) (Ex. 1016) (“Poggio”); JP Patent Application Publication No.
`1H11—164058 (translation) (Ex. 1018) (“Sato”). Citations are to exhibits filed
`in CBM2014-00108, unless otherwise noted.
`
`3 Petitioner contends that Stefik ’235 and Stefik ’980 should be treated as a
`
`single reference and refers to the references collectively as “Stefik.” 108
`Pet. 30, n.13. Patent Owner disagrees that Steflk ’235 and Stefik ’980
`should be considered as one reference. 108 Prelim. Resp. 13-15. We do not
`reach this issue because even when considered as one reference, we
`
`determine that Stefik ’235 and Stefik ’980 do not teach all of the recited
`
`claim limitations in the same form and order as listed in the claim.
`.
`4 Although claim 31 is omitted in the heading on page 43 of the 109 Petition,
`we include it here because it is identified as obvious over Ginter elsewhere
`
`. renders obvious to
`.
`in the Petition. See, e. g., 109 Pet. 32—33, 43'(“Ginter .
`a POSITA each of claims 1, 2, 7, 13, 15, 26, and 31, based on the disclosures
`identified below.”).
`
`
`
`CBM2014-00108 and CBM2014—00109
`
`Patent 8,061,598
`
`~
`
`‘
`
`.iRefe‘knce’ESI]2«<§\é§>z
`
`‘
`
`v,i,:.Claims‘Challenged
`
`Ginter, Stefik ’235, and Stefik ’980
`
`§ 103
`
`1, 2, 7, 13, 15, and 26
`
`Ginter and Sato
`
`§ 103
`
`1, 2, 7, 13, 15, and 26
`
`
`
`Ginter, Poggio, Stefik ’235, and
`Stefik ’980
`
`§ 103
`
`7
`
`.
`
`After considering the Petitions and Preliminary Responses, we
`
`determine that the ’598 patent is a covered business method patent and that
`Apple has demonstrated that it is more likely than not that at least one of the
`challenged claims is unpatentable. Based on the information presented, we
`
`institute a covered business method patent review of claim 26 of the ’598
`
`patent.
`
`C. Related Matters
`
`The parties indicate that Smartflash has sued Apple for infringement
`
`of the ’598 patent and identify the following district court case: Smartflash
`
`I LLC v. Apple Inc., Case No. 6:13—cv—447 (ED. Tex.). See, e. g., 108 Pet. 23;
`
`108 Paper 5, 2. The parties also indicate that the .’598 patent is the subject of
`
`a second district court case, to which Apple is not a party: Smartflash LLC v.
`
`Samsung, Case No. 6:13-cy-448 (E.D. Tex.). Id.
`Apple filed ten other Petitions for covered business patent review
`challenging claims of patents owned by Smartflash and disclosing similar
`
`subject matter: CBM2014-00102; CBM2014-00103; CBM2014-00104;
`
`CBM2014-00105; CBM2014-00106; CBM2014-00107; CBM2014—00110;
`
`CBM2014-00111; CBM2014-00112; and CBM2014—00113.
`
`
`
`CBM2014-00108 and CBM2014-00109
`Patent 8,061,598
`
`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
`
`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 internet 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: 1 1. 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 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. Challenged Claims
`
`Apple challenges claims 1, 2, 7, 13, 15, 26, and 31 of the ’598 patent.
`
`Claims 1, 26, and 31 are independent. Claims 2, 7, 13, and 15 depend from
`
`claim 1. Claims 1 and 31 are illustrative of the claims at issue and recite the
`
`following:
`
`
`
`CBM2014—00108 and CBM2014-00109
`
`Patent 8,061,598
`
`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.
`
`31. A method of controlling access. to content data, the method
`comprising:
`
`receiving a data access request from a user for a content data item,
`
`reading the use status data and one or more use rules from parameter
`memory that pertain to use of the requested content data item;
`evaluating the use status data using the one or more use rules to
`determine whether access to the content data item is permitted; and
`
`enabling access to the content data item responsive to a determination
`that access to the content data item is permitted.
`
`Id. at 28:18—30.
`
`ANALYSIS
`
`A. 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
`
`
`
`CBM2014-00108 and CBM2014-00109
`
`Patent 8,061,598
`
`of the 7598 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 ofthis decision, we
`
`construe the claim term “use rule.”
`
`1.
`“use rule ”
`The term "‘use rule” is recited in independent claims 1 and 31. Neither
`
`party proposes-a construction of “use rule.” The ’598 patent describes “use
`
`rules” as “for controlling access to the stored .content” (Ex. 1001, Abstract)
`
`and as “indicating permissible use of data stored on the carrier” (id at 9:14-
`
`' 16). The ’598 patent also describes “evaluating the use status data using the
`use‘rules to determine whether access to the stored data is permitted.” Id. at
`
`6:3 840; see also id. at 21:48-53 (“[E]ach content data item has an
`
`associated use rule to specify under what conditions a user of the smart Flash '
`
`card is allowed access to the content data item”). Accordingly, for purposes
`
`of this decision, we determine that “use rule” means “a rule specifying a
`
`condition under which access to content is permitted.”
`
`B. 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 C.F.R. § 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
`
`
`
`CBM2014-00108 and CBM2014-00109
`Patent 8,061,598,
`
`.
`
`Covered Business Method Patent and Technological Invention; Final Rule,
`
`77 Fed. Reg. 48,734, 48,736 (Aug. 14, 2012) (“CBM Rules”) (Comment 8).
`
`1. Financial Product or Service.
`Apple asserts that claim 7 “clearly concerns a computer system .
`
`.
`
`. for
`
`performing data processing and other operations used in the practice,
`
`administration, or management of a financial activity and service” because it
`
`“describes storing and providing payment data to a payment validation
`
`system.” 108 Pet. 16; 109 Pet. 16. Based on this record, we agree with
`
`Apple that the subject matter recited by claim 7 is directed to activities that
`
`are financial in nature, namely data access conditioned on payment
`validation. Claim 7 recites “payment data memory to store payment data
`and code to provide the payment data to a payment validation system”.
`Payment validation is a financial activity, and conditioning data access based
`on payment validation amounts to a financial service. This is consistent with
`
`‘
`
`the Specification of the ’598 patent, which confirms claim 7’s connection to
`financial activities by stating that the invention f‘relates to a. portable data
`carrier for storing and paying for data.” Ex. 1001, 1:21—23. The
`Specification also states repeatedly that the disclosed invention, involves
`
`managing access to data based on payment validation. See, e. g, Ex. 1001,
`
`1:59—67; 6:60—64; 20:50—54.
`
`Smartflash disagrees that Claim 7 satisfies the financial-in-nature
`
`requirement of AIA §I 18(d)(1), arguing that section should be interpreted
`
`narrowly to cover only technology used specifically in the financial or
`
`banking industry. 108 Prelim. Resp. 3—9; 109 Prelim. Resp. 3—9.
`
`Smartflash cites to various portions of the legislative history as support for
`
`its proposed interpretation. Id.
`
`
`
`CBM2014-00108 and CBM2014-00109
`
`Patent 8,061,598
`
`Although we agree with Smartflash that the statutory language
`
`controls whether a patent is eligible for a covered business method patent
`
`review, we do not agree that the phrase “financial product or service” is as
`
`limited as Smartflash proposes. The AIA does not include as a prerequisite
`
`for covered business method patent review, a “nexus” to a “financial
`
`business,” but rather 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.” AIA § l8(d)(1). Further,
`
`‘ contrary to Smartflash’s View of the legislative history, the legislative
`
`history 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 48,735-36. 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. 85432 (daily ed. Sept. 8,
`
`2011) (statement of Sen. Schumer)).
`
`In addition, Smartflash asserts that claim 7 is not directed to an ‘
`
`apparatus or method that is financial in nature because claim 7 “omits the
`
`specifics of how payment is made.” 108 Prelim. Resp. 8; 109 Prelim.
`
`Resp. 8. We are not persuaded by this argument because § l8(d)(l) of the -
`
`AIA does not include such a requirement, nor does Smartflash point to any
`
`other authority that makes such a requirement. 108 Prelim. Resp. 8;
`
`109 Prelim. Resp. 8. We determine that because payment is required by
`
`claim 7, as Smartflash acknowledges, the financial in nature requirement of
`
`§ 18(d)(1) is satisfied.
`
`
`
`CBM2014-00108 and CBM2014-00109
`
`Patent 8,061,598
`
`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
`
`Apple asserts that claim 7 does not fall within § 18(d)(1)’s exclusion
`
`for “technological inventions.” 108 Pet. 17—22; 109 Pet. 18—23. In
`
`particular, Apple argues that claim 7 “does not recite a technological feature»
`
`that is novel and unobvious” or “solve a technical problem using a technical
`
`solution.” Id. (quoting 37 C.F.R. § 42.301(b) (emphasis omitted».
`
`Smartflash disagrees and argues that claim 7, as a whole, recites at leaSt one
`
`technological feature. 108 Prelim. Resp. 11; 109 Prelim. Resp. 10-11.
`
`We are persuaded that claim 7 as a whole does not recite a
`
`technological feature that is novel and unobvious over the prior art. Claim 1,
`
`on which claim 7 depends, recites a “portable data carrier.” This
`
`component, however, is a generic hardware device known in the prior art.
`
`The Specification discloses, for instance, that a portable data carrier may be
`
`- a “standard smart card.” See Ex. 1001, 11:28—29; 108 Pet. 18; 109 Pet. 19.
`
`Claim 7 also recites a “payment validation system.” The Specification,
`however, discloses that the required payment validation system may be one
`
`that is already in use or otherwise commercially available. For'example,
`
`“[t]he payment validation system may be part of the data supplier’s
`Computer systems or it may be a separate e-payment system.” Ex. 1001,
`
`8:63—65; see also id. at 13:35—47.
`
`In addition, 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
`
`10
`
`
`
`CBM2014-00108 and CBM2014-00109
`
`Patent 8,061,598
`
`states that “there is an urgent need to find a way to address the problem of
`
`data piracy” (id. at 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). Thus, we determine that claim 7 is merely the
`
`recitation of a combination of known technologies, 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).
`
`Smartflash also argues that claim 7 falls within § 18(d)(1)’s exclusion
`for “technological inventions” because it is directed towards solving the
`technological problem of “data piracy” with the technological solution of
`
`“(1) a portable data carrier from which payment data is read and to which at
`
`least one content data item is written and (2) one or more use rules, also
`
`stored on the portable data carrier, specifying at least one use rule for using
`
`the content data item(s) written into the portable data carrier.” 108 Prelim.
`
`Resp. 10—11; 109 Prelim. Resp. 10—11‘. We are not persuaded by this
`
`- argument because, as Apple argues, the problem being solved by claim 7 is a
`
`business problem—data piracy. 108 Pet. 21—22; 109 Pet. 21—22. 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 internet without fear of loss of revenue, thus
`
`undermining the position of data pirates.” Ex. 1001, 2:11—15. Thus, based
`
`on the particular facts of this proceeding, we conclude that claim 7 does not
`
`recite a technological invention and is eligible for a covered business method
`
`patent review.
`
`'
`
`11
`
`
`
`CBM2014-00108 and CBM2014-00109
`
`Patent 8,061,598
`
`3. Conclusion
`
`In View of the foregoing, we conclude that the ’598 patent is a covered
`
`business method patent under ALA § 18(d)( 1) and is eligible for review
`
`using the transitional covered business method patent program.
`
`C.’ Anticipation by Stefik ’235 and Stefik ’980
`
`Apple argues that claims 1, 2, 7, 13, 15, and 31 are unpatentable under
`
`35 U.S.C. § 102 as anticipated by 'Stefik ’235 and Stefik ’980. 108 Pet.
`
`29-34, 41-76.
`
`Analysis
`
`'
`
`Stefik ’235 teaches a portable Document Card (“DocuCard”) for
`
`storing information in a digital form, storing usage rights for the
`
`information, processing user-initiated functions and requests to access
`
`documents stored therein, interfacing to external devices for reading and
`
`writing digital information, and allowing a user to directly interact with the
`DocuCard, Ex. 1013, 2:29—40, 7:35-42.
`‘
`
`Stefik ’980 teaches a “repository” for storing digital works,
`
`controlling access to digital works, billing for access to digital works and
`
`maintaining the security and integrity of the system. Ex. 1014, 6:57—61.
`
`We are not persuaded that Apple has shown that Stefik ’980 and
`
`Stefik ’235 disclose “use rules,” as recited in independent claims ‘1 and 31.
`
`Apple cites the disclosure in Stefik ’235 of a “description file contain[ing]
`
`the usage rights for the document,” and “a rights portion 504 wherein the
`
`granted usage rights and their status are maintained,” and the disclosure in
`
`Stefik ’980 of “conflict rules .
`
`.
`
`. to dictate when and how a right may be
`
`exercised.” 108\Pet. 46—48. The quoted portions of Steflk ’235 and Stefik
`’980, however, do not show sufficiently that usage rights are “a rule
`
`12
`
`
`
`CBM2014-00108 and CBM2014-00109
`
`Patent 8,061,598
`
`specifying a condition under which access to content is permitted,” as we
`
`construed “use rules” to mean above. For example, rights portion 504 is
`described as “a data structure, such as a look-up table, wherein the various
`
`information associated with a right is maintained.” Ex. 1013, 828—10; see
`
`also Ex. 1014, 9:54—10:1 (describing right code field 1001 and status
`
`information field 1002). An exemplary data structure is illustrated in Figure ’
`
`10 of Stefik ’980 and the information contained in such a data structure is
`
`indicated in Table 1. Ex. 1014, 10:28—32. Table 1 of Stefik ’980 discloses,
`for example, a “Loan-Period” propeitywith a value in “Time-Units” that is
`an “[i]ndicator of the maximum number of time-units that a document can
`
`be leased out.” A data structure and the information within it, however,
`
`cannot be a rule. At best, a rule might use the information in the data
`structure—cg, if the number of time-units that a document has been leased
`
`out is less than Loan-Period, then allow access—but the usage right itself
`
`(e.g., Loan-Period) is not “a rule specifying a condition under which access
`
`to content is permitted,” as we have construed “use rules.” Likewise, the
`
`conflict rules taught in Stefik ’980 are not “a rule specifying a cOndition
`
`under which access to content is permitted,” because they do not,
`
`themselves, “specify a condition under which access to content is
`
`.
`
`permitted,” they merely specify which of two conflicting usage rights must
`
`be satisfied. Accordingly, on the record before us, we are not persuaded that
`
`Apple has provided sufficient and credible evidence that Stefik ’235 and
`Stefik ’980 disclosel“use rules.”
`
`‘
`
`We also are not persuaded that Apple has shown that Stefik ’980 and
`
`Stefik ’235 disclose “use status data,” as recited in claim 31. Apple
`
`contends that Stefik ’235 and Stefik ’980 each disclose this limitation. 108
`
`13
`
`
`
`CBM2014-00108 and CBM2014-00109
`
`Patent 8,061,598
`
`Pet. 70—74. Specifically, Apple contends that “usage rights status .
`
`.
`
`. stored
`
`in-a descriptor file” corresponds to the claimed “use status data.” Pet. 72—
`74. Apple’s claim chart also cites portions of Stefik ’235 and Stefik ’980, as A
`
`well as the Wechselberger Declaration, to support Apple’s contentions that
`
`“usage rights status” satisfies the claimed “use status data.” Id. (citing Ex.
`
`1013, Abstract, 3:9—11, 4:44—46, 5:55—57; Ex. 1014, Abstract, 6:42—55,
`
`7:26—31, 10:28—32 and Table-1, 11259—1227, 14:15—27, 19:12—15, 31:26—35;
`
`Ex. 1021, App’x D, 90—93). The cited portions of the Wechselberger
`
`Declaration repeat the contentions presented in the claim chart. See Ex.
`
`1021, App’x D, 90—93.
`
`.
`
`The portions of Stefik ’235 and Stefik ’980 quoted by Apple’s claim
`
`chart relate to usage rights attached to digital works. See 108 Pet. 67
`(quoting Ex. 1013, 39—1 1, 4:40—46, 8:8—10). For. example, Stefik ’235
`
`explains that “[u]sage rights are attached to digital works and control how
`
`the digital work can be used or distributed, and are further used to specify
`any fees associated with use or distribution of digital works.” Id. at 4:40—43.
`
`Apple further identifies a “status information field 1002” that “will contain
`
`information relating to the state of a right and the digital work.” 108 Pet. 71
`
`(quoting Ex. 1014, 10:28—32). Apple does not explain sufficiently, however,
`
`why usage rights status or status information field 1002 satisfy “use status
`data.” For example, Apple does not explain why usage rights in Stefik ’235
`
`and Stefik ’980 is within the scope of the examples of “use status data”
`
`provided by. the Specification of the ’598 patent (e.g., “indicating a use
`status of data” (Ex. 1001, 9: 13—14), “indicating past use of the stored data”
`
`(id. at 9:33—35), “present use status” (id. at 24:38), “actual use of the data
`
`item made so far” (id. at 24:44—45), “how much use has been made of the
`
`14
`
`
`
`CBM2014-00108 and CBM2014-00109
`
`Patent 8,061,598
`
`accessed content data time” such as “start and end time markers or simply a.
`
`play duration time” (id. at 24:67—25:4))'. In addition to the quoted portions
`
`of StefikA’980, Apple also cites Table 1. 108 Pet. 71, 73. To the extent that
`
`Apple relies upon Table 1 of Stefik ’980 as disclosing “use status data,”
`
`Apple has not explained adequately the significance of that disclosure.
`
`Thus, we are not persuaded that either Stefik ’235 or Stefik ’980 discloses
`
`this limitation.
`
`Conclusion
`
`On this record, we are not persuaded that Apple has established that it
`
`is more likely than not that claims 1, 2, 7, 13, 15, and 31 are unpatentable as
`
`anticipated by Stefik ’235 and Stefik ’980.
`
`D. Obviousness over Stefik ’235 and Stefik ’980
`
`Apple argues that claims 1, 2, 7, 13, 15, 26, and 31 are unpatentable
`
`under 35 U.S.C. § 103(a) as obvious over Stefik ’235 and Stefik ’980. 108
`
`Pet. 29—34, 41—76.
`
`24mm
`Inlight of the arguments and evidence, Apple has established that it is
`more likely than not that claim 26 is unpatentable as obvious over the
`
`combination of Stefik ’235 and Stefik ’980, but has not established that is is
`
`more likely than not that claims 1, 2, 7, 13, 15, and 31 are unpatentable as
`obvious over Stefik _’235 and Stefik ’980.
`I
`
`For example, with respect to claim 26, Apple argues that “[a] POSITA
`
`would have been motivated and found it obvious to employ a memory card
`
`for a mobile or cellular device that included a SIM portion that identifies a
`subscriber to a network operator, such as a mobile phene, as a repository in
`
`Stefik’s content distribution and access network.” 108 Pet. 65, n.17; see
`
`15
`
`
`
`CBM2014-00108 and CBM2014-00109
`
`Patent 8,061,598
`
`also id. at 4, n.2 (citing Ex. 1001, 429—13; Ex. 1011, 108). On this record,
`
`we are persuaded that Apple’s citations support Apple’s contentions.
`
`’
`
`We are not persuaded by Smartflash’s argument that there is no
`
`evidence that one of ordinary skill in the art would have combined the
`
`teachings of Stefik ’235 with the teachings of Stefik ’980 because
`
`Smartflash’s argument is based on an unproven premise that Stefik ’235’s
`
`reference to Stefik ’980 must uniquely identify Stefik ’980. 108 Prelim.
`
`Resp. 15. One reference need not explicitly identify another reference by
`
`“application serial number, filing date, inventors or attorney docket number”
`
`(id. at 14) in order to form the basis for an obvio-usness combination. Apple
`
`argues‘that “there is explicit motivation to implement the repository
`
`disclosed by Stefik ’980 using the Document Card (DocuCard) of Stefik
`
`’235.” 108 Pet. 30, n.13 (citing Ex. 1013, 2:47—52; Ex. 1014, 16:56—58; Ex.
`
`1021 fl 565). Stefik ’980 teaches that “the repository could be embedded in a
`
`‘card’ that is inserted into an available slot in a computer system” (Ex. 1014,
`16:56—58), and Stefik 5235 teaches a repository embedded in a card (Ex.
`
`1013, 2:47—52). On the record before us, we are persuaded that Apple has
`
`provided sufficiently an articulated reasoning with some rational
`underpinning to support the legal conclusion of obviousness. See KSR Int ’1
`iv. Teleflex Inc, 550 US. 398, 418 (2007) (citing In re Kahn, 441 F.3d 977,
`
`988 (Fed. Cir. 2006)).
`
`I
`
`5 On this record, we are not persuaded by Smartflash’s argument that the
`Declaration of Mr. Wechselberger is entitled to little‘or no weight because it
`does not disclose the underlying facts on which the opinion is based.
`108 Prelim. Resp. 16—19; 109 Prelim. Resp. 20—24. Smartflash identifies
`purported omissions from the Declaration, but offers no evidence that Mr.
`Wechselberger used incorrect criteria, failed to consider evidence, or is not.
`an'expert in the appropriate field.
`
`16
`
`
`
`CBM2014-00108 and CBM2014-00109
`
`Patent 8,061,598
`
`With respect to claims 1 and 31, however, we are not persuaded that
`
`Apple has shown that Stefik ’980 and Stefik ’235 teaches “use rules” or “use
`
`statusdata” for the reasons discussed above. Moreover, Apple does not
`
`argue that “use rules” or “use status data” are obvious in View of Stefik ’235
`
`I and Stefik ’980, as it does with other limitations in various footnotes
`
`throughout the Petition. Accordingly, we also are not persuaded that the
`
`teachings of Stefik ’235 and Stefik ’980 identified by Apple render obvious
`
`the recited “use rules” and “use status data.”
`
`Conclusion
`
`I
`
`On this record, we are persuaded that Apple has established that it is
`
`more likely than not that claim 26 is unpatentable as obvious over Stefik
`
`’23 5‘ and Stefik ’980, but we are not persuaded that Apple has established
`
`that it is more likely than not that claims 1, 2, 7, 13, 15, and 31 are
`
`unpatentable as obvious over Stefik ’235 and Steflk ’980.
`
`E. Anticipation by Ginter
`
`Apple argues that claims 1, 2, 7, 13, 15, 26, and 31 are unpatentable
`
`under 35 U.S.C. § 102(b) as anticipated by Ginter. 109 Pet. 29—33, 43—78.
`wags ,
`'
`
`Ginter discloses a portable “virtual distribution environment”
`
`(“VDE”) that can “control and/or meter or otherwise monitor use of
`
`electronically stored or disseminated information.” Ex. 1015, Abstract,
`
`Fig. 71, 52:26—27.
`
`,
`
`In light of the arguments and evidence, Apple has not established that
`
`it is more likely than not that claims 1, 2, 7, 13, 15, 26, and 31 are
`
`unpatentable as anticipated by Ginter.
`
`17
`
`
`
`CBM2014-00108 and CBM2014-00109
`
`Patent 8,061,598
`
`With respect to independent claims 1 and 31, we are not persuaded
`that Apple has shown sufficiently that Ginter discloses “use rules.” Apple
`
`identifies in a parenthetical Ginter’s “billing method map MDE and/or
`
`budget method UDE” as the recited “use rules.” 109 Pet. 50—53, 75—78.
`
`The quoted portions of Ginter, however, do not show sufficiently that the
`
`billing method map MDE and/or budget method UDE reflects “a rule
`
`specifying a condition under which access to content-is permitted,” as we
`construed “use rules” to mean‘ above. The examples given in the quoted
`
`portions of Ginter—“e.g., a price list, table, or parameters to the billing
`
`amount Calculation algorithm”—relate to billing for use of a VDE content
`
`object, but not to “a rule specifying a condition under which access to
`content is permitted.” Ex. 1015, 190:45—57. For claims 2 and 31, Apple
`
`cites Ginter’s disclosure that, “[t]he BUDGET method 1510 might, for
`example, specify a use process 1476 that compares a meter count to a budget
`
`value and fail the (operation if the meter count exceeds the budget value”
`
`(109 Pet. 77 (citing Ex. 10,15, 172:32—3 5)), but it is not clear whether Apple
`
`is relying upon use process 1476 as satisfying “use rules.” In any event,
`
`Apple does not show that use process 1476 is part of the billing method map
`
`MDE and/or budget method UDE, which it argues satisfies “use rules.”
`
`Accordingly, on the record before us, we are not persuaded that Apple has
`
`provided sufficient and credible evidence that Ginter discloses “use rules.”
`
`With respect to independent claim 26, which recites a “subscriber
`identity module (SIM),” Apple argues that “a POSITA would have
`
`’
`
`' understood that .
`
`.
`
`. a personal digital assistant with access to a wide area
`
`network .
`
`.
`
`. necessarily and thus inherently includes a subscriber identity
`
`module (SIM) portion.” 109 Pet: 72, n.29. Smartflash argues that Apple
`
`18
`
`
`
`CBM2014-00108 and CBM2014-00109
`
`Patent 8,061,598
`
`does not proVide a citation to any reference to support its contention.
`109 Prelim. Resp. 14—15. “Inherency .
`.
`. may not be established by
`
`probabilities or possibilities.” In re Oélrich, 666 F.2d 578, 581 (CCPA
`1981) (quoting Hansgirg v. Kemmer, 102 F.2d 212, 214 (CCPA 1939)). A
`
`SIM card is designed for use with a mobile device that complies with the
`
`Global System for Mobile Communications standard. See, e. g., Microsoft
`
`Computer Dictionary, 2d. Ed. (2002) (“SIM card 11. Short for Subscriber
`
`~ Identity Module card. A smart card is designed for use with GSM (Global
`
`System for Mobile Communications) mobile phones. SIM cards contain
`
`chips that store a subscriber’s personal identifier (SIM PIN), billing
`
`information, and, data (names, phone numbers)” (emphasis original)).
`
`Apple identifies nothing in Ginter that discloses that its personal digital
`
`assistant complies with the GSM standard, and nothing in Ginter precludes
`
`the use of alternative standards. To the extent that Ginter’s personal digital
`
`assistant communicates over a wireless wide area network based on a
`
`standard other than GSM, such as Code Division Multiple Access (CDMA),
`
`it does not require a SIM card. Accordingly, on this record, we are not
`
`persuaded that a SIM card is inherent in Ginter.
`
`I
`
`Conclusion
`
`,
`
`On this record, we are not persuaded that Apple has established that it
`is more likely than not that claims 1, 2, 7, 13, 15, 26, and‘31 are
`
`unpatentable as anticipated by Ginter.
`
`F. Obviousness over Ginter
`
`Apple argues that claims 1, 2, 7, 13, 15, 26, and 31 are unpatentable
`
`under 35 U.S.C. § 103(a) as obvious over Ginter. 109 Pet. 29—33, 43—78.
`
`19
`
`
`
`CBM2014-00108 and CBM2014-00109
`
`Patent 8,061,598
`
`Art—ales
`In light. of the argu
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