Paper 48
`Entered: May 5, 2017
`
`Trials@uspto.gov
`Tel: 571-272-7822
`
`
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`_______________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`_______________
`
`GOOGLE INC.,
`Petitioner,
`
`v.
`
`PATRICK ZUILI,
`Patent Owner.
`_______________
`
`Case CBM2016-00022
`Patent 8,326,763 B2
`_______________
`
`
`
`Before JAMESON LEE, GLENN J. PERRY, and MIRIAM L. QUINN,
`Administrative Patent Judges.
`
`
`LEE, Administrative Patent Judge.
`
`
`
`
`FINAL WRITTEN DECISION
`Covered Business Method Patent Review
`35 U.S.C. § 328(a) and 37 C.F.R. § 42.73
`
`
`
`
`

`

`CBM2016-00022
`Patent 8,326,763 B2
`
`
`I.
`
`INTRODUCTION
`
`A. Background
`On December 18, 2015, Petitioner filed a Petition (Paper 1, “Pet.”)
`requesting covered business method patent review of claims 1–3, 5, 6, 10,
`11, 14, 15, and 17 of U.S. Patent No. 8,326,763 B2 (Ex. 1001, “the ’763
`patent”), under Section 18 of the Leahy-Smith America Invents Act, Pub. L.
`No. 112-29, 125 Stat. 284, 329 (2011) (“AIA”). On June 1, 2016, we
`instituted a covered business method patent review (Paper 11, “Inst. Dec.”)
`on the sole ground that claims 1–3, 5, 6, 10, 11, 14, 15, and 17 are directed
`to patent ineligible subject matter under 35 U.S.C. § 101. We did not
`institute review of any claim on any other alleged ground of unpatentability,
`including alleged grounds of obviousness over prior art. Inst. Dec. 45.
`Subsequent to institution of review, Patent Owner filed a Patent Owner
`Response (Paper 19, “PO Resp.”) and Petitioner filed a Reply (Paper 28,
`“Reply”) to Patent Owner’s Response.
`After filing of Petitioner’s Reply to Patent Owner’s Response, the
`U.S. Court of Appeals for the Federal Circuit issued a decision in Unwired
`Planet, LLC v. Google Inc., 841 F.3d 1376 (Fed. Cir. 2016), which provided
`new guidance on how to determine a patent’s eligibility for covered business
`method patent review. Given this new binding authority, we authorized
`Patent Owner to submit additional briefing “to discuss the issue of whether
`the subject matter of at least one claim of the ’763 patent is directed to 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, in light of the Federal Circuit’s decision in Unwired
`Planet, supra.” Paper 30, 2. We also authorized Petitioner to file a response
`
`
`
`2
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`

`

`CBM2016-00022
`Patent 8,326,763 B2
`
`to Patent Owner’s submission. Id. Each party filed its submission. Paper
`31 (Patent Owner submission); Paper 32 (Petitioner submission).
`No oral hearing was held for this proceeding. Paper 39.
`We have jurisdiction under 35 U.S.C. § 6. This Final Written
`Decision is issued pursuant to 35 U.S.C. § 328(a) and 37 C.F.R. § 42.73.
`For the reasons discussed below, we determine that Petitioner has shown by
`a preponderance of the evidence that claims of the ’763 patent are directed to
`patent ineligible subject matter under 35 U.S.C. § 101.1
`B. Related Proceedings
`Petitioner indicates that the ’763 patent was the subject of Brite Smart
`Corp. v. Google Inc., No. 2:14-cv-760-JRG (E.D. Tex.) (closed). Pet. 4.
`Petitioner also identifies Brite Smart Corp. v. Google Inc., No. 5:15-cv-
`03962-BLF (N.D. Ca.) as a related matter. Id. Petitioner also has filed
`petitions seeking covered business method patent review of two related
`patents, U.S. Patent No. 8,671,057 B1 (CBM2016-00008) and U.S. Patent
`No. 7,953,667 B1 (CBM2016-00021).
`
`
`
`
`1 In its Reply, Petitioner notes numerous instances of non-compliance of the
`Patent Owner Response with the pertinent rules involving certification, font,
`and spacing requirements. Reply 2–3. Given Patent Owner’s pro se status,
`these violations are not sufficient to preclude us from considering the Patent
`Owner Response. Petitioner also asserts that Patent Owner did not serve the
`Patent Owner Response on Petitioner’s counsel of record. Id. at 2.
`However, the Patent Owner Response is accompanied by such a certificate
`of service. PO Resp. 173. The content of the Reply also indicates that
`Petitioner has received a copy of the Patent Owner Response. No action is
`required.
`
`
`
`3
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`

`CBM2016-00022
`Patent 8,326,763 B2
`
`
`C. Asserted Ground of Unpatentability
`Trial was instituted based on the following ground of unpatentability:
`
`References
`Not Applicable
`
`Basis of Unpatentability Claims Challenged
`lack of patent eligibility
`1–3, 5, 6, 10, 11, 14,
`under 35 U.S.C. § 101
`15, and 17
`
`Petitioner relies on the Declaration of Stephen Gray, filed in support
`of the Petition. Ex. 1006. Patent Owner submitted an Affidavit of
`Mr. Patrick Zuili, relied on, not in Patent Owner’s Response, but in Patent
`Owner’s Renewed Motion to Exclude Evidence (Paper 33). Ex. 2010.
`
`D. The ’763 Patent
`The ’763 patent issued on December 4, 2012, and is titled: “Method
`and System to Detect Invalid and Fraudulent Impressions and Clicks in
`Web-Based Advertisement Systems.” Ex. 1001, (45), (54). The ’763 patent
`relates specifically to a method for protecting the providers of “pay-per-
`click” services from illegitimate usages. Id. at 1:19–22. A “pay-per-click”
`system is described as follows:
`In accordance with such [pay-per-click] capability, a user goes
`to a website, and inputs the name of goods or services that they
`would like the pay-per-click company to find. Various providers
`of goods and services register their websites with the company,
`and these are provided to the user in a list which is prioritized by
`the level of compensation which the merchant will give the pay-
`per-click company if the user is routed to their site. For example,
`using such a system, if a user types in “binoculars,” the pay-per-
`click system might return five potential links, with the most
`prominent one being associated with that supplier of binoculars
`which will compensate for a penny or a few cents more than the
`links presented below.
`Id. at 1:35–47.
`
`
`
`
`
`
`4
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`

`CBM2016-00022
`Patent 8,326,763 B2
`
`
`The ’763 patent describes that “a user may cause an undesirable level
`of expenditure on the part of the merchant by overclicking on a particular
`link.” Id. at 1:49–51. The ’763 patent states that “it has been known that
`some users have done [overclicking] simply for the purpose of undermining
`a particular provider or competitor.” Id. at 1:48–50.
`Figure 1 of the ’763 patent is reproduced below:
`
`
`Figure 1 illustrates a preferred embodiment of the ’763 patent. Id. at 2:7–9.
`Search engine 102 provides search results to a user along path 104. Id. at
`
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`
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`CBM2016-00022
`Patent 8,326,763 B2
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`2:23–24. The search engine also “generates a code, preferably in the form of
`a serial number utilizing a cookie via [A]ctive X, Java, Javascript, or any
`other type of technology based upon the end-user’s Global Unique identifier
`(GUID).” Id. at 2:29–32. The search engine writes the code into a memory
`on the end-user’s device, e.g., floppy disk 106 shown in Figure 1 or a flash
`memory. Id. at 2:36–39. The text in the description in Figure 1 along path
`104 to the user device indicates that the code is retrieved from the user’s
`computer and added to the link provided to the user as a result of the user’s
`search request. Specifically, the code is concatenated with the link provided
`as the search result. Id. at 2:39–42.
`When a user clicks on a link provided by the search engine to website
`122, the code or serial number is transmitted to company 120 along path
`130. Id. at 2:46–49. The pay-per-click company will invoice website 122
`only when the code or serial number has been received. Id. at 2:49–50. The
`’667 patent describes: “if multiple requests are made by the same user, they
`may be considered legitimate if they are sufficiently spaced apart in time to
`be indicative of a legitimate as opposed to fraudulent access to the website
`122.” Id. at 2:53–57. In the Summary of Invention portion of the
`Specification, the ’763 patent describes: “[B]y observing a metric like the
`number of clicks for a given period of time, be it a short time or a longer
`period, such as a day or a week, the system can automatically determine if
`certain clicks are illegitimate.” Id. at 1:65–2:1. In that regard, the ’763
`patent further states: “This allows the pay-per-click company to more fairly
`invoice the merchants, thereby preventing fraudulent over use.” Id. at 2:1–3.
`The independent claims are claims 1, 10, and 14, as reproduced
`below:
`
`
`
`6
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`

`CBM2016-00022
`Patent 8,326,763 B2
`
`
`1. A method for detecting fraudulent activity in a pay-
`
`per-click system, comprising: (a) providing a pay-per-click
`engine on a server side; b) receiving, at said server side, a
`request from a client; c) generating a unique code on the server
`side, for identifying said client; d) transmitting said code to said
`client from the server side; e) transmitting to said client from
`the server side, in response to said request, one or more links
`associated with one or more websites associated with one or
`more merchants; f) generating website information regarding a
`website selected by the client when said client clicks on one of
`said links; g) transmitting said code and said website
`information together from said client to said server side; h)
`receiving said code and said website information at the server
`side, and detecting fraudulent activity by measuring the
`duration between clicks by said client to said selected website
`by examining said code and website information.
`Id. at 2:59–3:8.
`
`10. In an advertising system including a pay-per-click
`engine on a server side, the pay-per-click engine providing one
`or more links associated with one or more web pages to a user
`at a device on a client side, the method for identifying fraud
`comprising the steps of: generating a code on the server side,
`the code identifying said device on the client side; sending said
`code to said device; receiving data from said device, said data
`including said code and information about one or more
`selections by the user of at least one of said one or more web
`pages; determining from said data whether said at least one of
`said selections of said at least one web page is fraudulent; and
`examining a duration between a time of one of said selections
`of said at least one [web page] and a time of another of said
`selections of said at least one [web page].
`Id. at 3:37–50.2
`
`
`2 The bracketed term “web page” was inserted by a Certificate of
`Correction, dated August 19, 2014, to replace original term “web site” as
`issued. Ex. 3001.
`
`
`
`7
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`

`CBM2016-00022
`Patent 8,326,763 B2
`
`
`14. A method for detecting fraudulent activity in a pay-
`
`per-click system, comprising: (a) providing a pay-per-click
`engine on a server side; b) receiving, at said server side, a
`request from a client; c) generating a unique code on the server
`side, for identifying said client; d) transmitting said code to said
`client from the server side; e) transmitting to said client from
`the server side, in response to said request, one or more links
`associated with one or more websites associated with one or
`more merchants; f) receiving, on said server side, website
`information regarding a website selected by the client together
`with said code, when said client clicks one of said links; g)
`detecting fraudulent activity by measuring the duration between
`clicks by said client to said selected website by examining said
`code and website information.
`Id. at 4:17–30.
`
`II. ANALYSIS
`A. Grounds for Standing
`Section 18 of the AIA created a transitional program, limited to
`persons or their privies that have been sued or charged with infringement of
`a “covered business method patent,” to seek covered business method patent
`review. AIA §§ 18(a)(1)(B), 18(d)(1), Pub. L. No. 112-29, 125 Stat. 284,
`329–331 (2011); see 37 C.F.R. § 42.302. Petitioner represents that it has
`been sued for infringement of the ’763 patent in Brite Smart Corp. v. Google
`Inc., No. 2:14-cv-760-JRG-RSP (E.D. Tex.). Pet. 8; see Ex. 1007.
`Petitioner also represents that it is not estopped from seeking covered
`business method patent review of the ’763 patent on the grounds it asserts.
`Pet. 8. Patent Owner does not dispute that Petitioner has been sued for
`infringement of the ’763 patent.
`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
`8
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`

`CBM2016-00022
`Patent 8,326,763 B2
`
`product or service, except that the term does not include patents for
`technological inventions.” AIA § 18(d)(1); 37 C.F.R. § 42.301(a).3 We
`refer to that part of the statutory definition of covered business method
`patent, up to the clause beginning with the word “except,” as the “financial
`product or service requirement,” and the clause commencing with the word
`“except” as the “technological invention exception.”
`A patent need have only one claim directed to a covered business
`method to be eligible for covered business method patent review. See
`Transitional Program for Covered Business Method Patents—Definitions of
`Covered Business Method Patent and Technological Invention, 77 Fed. Reg.
`48,734, 48,736 (Aug. 14, 2012) (Response to Comment 8).
`
`Financial Product or Service Requirement
`1.
`In the Institution Decision, we applied a definition for “covered
`
`business method patent” that regards the financial product or service
`requirement as capable of being met by all activities that are “incidental to a
`financial activity or complementary to a financial activity.” Inst. Dec. 10.
`Our reviewing court has ruled in a recent decision on appeal from a final
`written decision of the Board in a covered business method patent review
`that the statutory requirement for a “covered business method patent” is not
`that broad, and that applying the scope that broadly is not in accordance with
`
`
`3 Patent Owner argues that a “software invention” is categorically not
`subject to review as a covered business method patent under Section 18 of
`AIA. PO Resp. 101–102. There is no such exception in the law. Rather, a
`patent on a “software invention” is like any other patent, in that it may or
`may not be a covered business method patent depending on an analysis
`under appropriate standards applied on a case-by-case basis to the claimed
`invention.
`
`
`
`9
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`

`CBM2016-00022
`Patent 8,326,763 B2
`
`law. Unwired Planet, 841 F.3d at 1382. Accordingly, we conduct the
`determination of whether the ’763 patent is a covered business method
`patent anew, based on the guidance we received from the Federal Circuit in
`Unwired Planet, and also with consideration of each party’s briefing on this
`subject submitted after the issuance of the Federal Circuit’s decision in
`Unwired Planet.
`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); 37 C.F.R. § 42.301(a). The
`Federal Circuit has made clear that the statutory definition covers a wide
`range of financial-related activities and is not limited in application to only
`financial institutions. For instance, the Court has stated:
`Blue Calypso asserts that its patents are not CBM patents because
`they relate to a method for managing and distributing advertising
`content, which is not “a financial product or service” that
`traditionally originated in the financial sector, e.g., banks,
`brokerages, holding companies and insurance firms. These
`arguments are foreclosed by our recent decisions in Versata II[4]
`and in SightSound Techs., LLC v. Apple Inc., 809 F.3d 1307 (Fed.
`Cir. 2015).
`Blue Calypso, LLC v. Groupon, Inc., 815 F.3d 1331, 1338 (Fed. Cir. 2016).
`The Court further stated: “Here, the Board declined to limit the application
`of CBM review to patent claims tied to the financial sector. This
`determination is consistent with our recent case law.” Id.
`
`
`4 Versata Dev. Grp., Inc. v. SAP Am., Inc., 793 F.3d 1306, 1318–23 (Fed.
`Cir. 2015).
`
`
`
`10
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`

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`Patent 8,326,763 B2
`
`The claimed invention in Blue Calypso involves a peer-to-peer
`
`advertising system in which a “subsidy” is recognized for a subscriber after
`an advertising-related token, first sent by an advertiser to the subscriber, is
`forwarded by that subscriber to another device owned by a recipient who has
`a relationship with the subscriber. Id. at 1336–1337. The Board construed
`“subsidy” as “financial assistance given by one to another,” which
`construction was unchallenged. Id. at 1339–1340. The Federal Circuit
`determined: “Thus, under this unchallenged interpretation, the claims of the
`Blue Calypso Patents are directed to methods in which advertisers
`financially induce ‘subscribers’ to assist their advertising efforts.” Id.
`at 1340.
`For the ’763 patent, we focus on claim 1, which recites: “A method
`for detecting fraudulent activity in a pay-per-click system.” As we noted
`above, the ’763 patent is titled: “Method and System to Detect Invalid and
`Fraudulent Impressions and Clicks in Web-Based Advertisement Systems.”
`Ex. 1001 [54]. Also as noted above, a “pay-per-click” system is described in
`the ’763 patent as follows:
`In accordance with such [pay-per-click] capability, a user goes
`to a website, and inputs the name of goods or services that they
`would like the pay-per-click company to find. Various providers
`of goods and services register their websites with the company,
`and these are provided to the user in a list which is prioritized by
`the level of compensation which the merchant will give the pay-
`per-click company if the user is routed to their site. For example,
`using such a system, if a user types in “binoculars,” the pay-per-
`click system might return five potential links, with the most
`prominent one being associated with that supplier of binoculars
`which will compensate for a penny or a few cents more than the
`links presented below.
`
`
`
`11
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`

`CBM2016-00022
`Patent 8,326,763 B2
`
`Id. at 1:35–47. We find, as Petitioner has argued (Pet. 9–10), and based on
`the above-noted portions of the Specification, that a pay-per-click system
`provides advertising of goods and services, for payment of money. Thus, we
`find that a pay-per-click system is itself a financial product and provides a
`financial service.
`
`As noted above, the pay-per-click company that provides online
`browsing services would present to its users information about various
`merchant providers of goods and services, and would be paid monetary
`compensation from a merchant for such presentation, if the presentation
`triggers a click by a user to be routed to the merchant’s website. Each click
`in a pay-per-click system, that routes a user to a merchant’s website,
`obligates the merchant advertiser to pay a sum of money to the entity
`presenting information about the merchant and a clickable link to users
`searching for information online. As such, each click in a pay-per-click
`system itself constitutes financial activity.
`
`Our finding that a pay-per-click system provides advertising of goods
`and services, for payment of money, is supported by the following testimony
`of Mr. Gray: “Generally, advertising requires merchants to pay for display
`of their ads and the web sites listing the ads are selling space on their
`website to display the ads. Specifically, as the ’763 Patent discloses, pay-
`per-click systems allow advertisers to place ads on websites.” Ex. 1006
`¶ 78. Further support stems from Mr. Gray’s testimony that “pay-per-click
`systems include the selling of website space, the act of sending an invoice,
`and exchange of money.” Id. Even Patent Owner in its submission
`discussing the Federal Circuit’s decision in Unwired Planet refers to a pay-
`per-click system as an “advertising model” and the administrator of a pay-
`
`
`
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`Patent 8,326,763 B2
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`per-click system as an “advertising platform operator” or an “advertising
`operator.” Paper 31, 3–5.
`
`We are cognizant that a “pay-per-click system” is expressly recited
`only in claim 1’s preamble, and that a preamble recitation may not be
`limiting. “Whether a preamble stating the purpose and context of the
`invention constitutes a limitation of the claimed process is determined on the
`facts of each case and in light of the overall form of the claim, and the
`invention as described in the specification and illuminated in the prosecution
`history.” Applied Materials, Inc. v. Advanced Semiconductor Materials Am.,
`Inc., 98 F.3d 1563, 1572–73 (Fed. Cir. 1996). In this instance, the recitation
`of a “pay-per-click system” in the preamble of claim 1 is limiting, because it
`is necessary to give life, meaning, and vitality to the subject matter of
`claim 1. See Symantic Corp. v. Computer Assocs. Int’l Inc., 522 F.3d 1279,
`1288 (Fed. Cir. 2008); Catalina Marketing Int’l. v. Coolsavings.Com,
`289 F.3d 801, 808 (Fed. Cir. 2002); Pitney Bowes, Inc. v. Hewlett-Packard
`Co., 182 F.3d 1298, 1305 (Fed. Cir. 1999).
`
`In the Summary of the Invention section, the Specification states:
`“This invention improves upon existing pay-per-click arrangements . . . .”
`Ex. 1001, 1:61–63. The Specification describes no environment for the
`disclosed invention other than in a “pay-per-click” system. The body of
`claim 1 specifically recites a step of “detecting fraudulent activity by
`measuring the duration between clicks by said client to said selected website
`by examining said code and website information.” Id. at 3:5–8. The
`“fraudulent activity” referred to in the body of the claim depends on the
`operations of a pay-per-click system to have meaning. For instance, the
`potentially fraudulent activity related to the duration between clicks is a
`
`
`
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`problem, because the merchant has an obligation to pay for each click in a
`pay-per-click system. Also in the Summary of the Invention section, the
`Specification states that determining if certain clicks are illegitimate “allows
`the pay-per-click company to more fairly invoice the merchants, thereby
`preventing fraudulent [overuse].” Id. at 2:1–3. Claim 1 expressly requires
`the links provided to a client be “associated with one or more websites
`associated with one or more merchants.” Id. at 2:65–67. For all of these
`reasons, we determine that the recitation of “pay-per-click system” in the
`preamble of claim 1 is limiting. We determine, in particular, that the step in
`the body of claim 1 for detecting fraudulent activity derives its meaning and
`significance from being implemented in a pay-per-click system.
`
`The data processing operations of claim 1 of the ’763 patent are
`financial activities the same as, if not even more so than, those held to be
`financial in Blue Calypso. In Blue Calypso, a subsidy, construed to be
`financial assistance, is provided to a subscriber for forwarding advertising to
`a device possessed by a recipient related to the subscriber. In the case of the
`’763 patent here, monetary compensation is made from the merchant
`advertiser to the online search provider for presenting advertising to client
`users who engage in online searching. The financial nature of the claimed
`invention is even more clear in this case than it was in Blue Calypso,
`because here the merchant advertiser is obligated to make monetary
`payment, and not simply to provide a “subsidy” which has been construed as
`“financial assistance given by one to another.”
`
`Patent Owner states that its invention is a “‘click fraud detection
`system.’” Paper 31, 5. Patent Owner argues: “[C]lick fraud is always
`incidental therefore click fraud detection is incidental to the pay-per-click
`
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`advertising model.” Id. at 3. Patent Owner again asserts: “Click fraud is
`incidental to the pay-per-click advertising model and cannot be CBM
`eligible.” Id. at 5. Patent Owner’s arguments are misplaced because they
`stem from an incorrect reading of the Federal Circuit’s decision in Unwired
`Planet. According to Patent Owner, if an invention is deemed incidental to a
`financial product or service, it cannot be regarded as CBM eligible. That is
`not the law as articulated in Unwired Planet. In that decision, the Federal
`Circuit clearly stated: “To be sure, claims that satisfy the PTO’s [overbroad]
`policy statement may also fall within the narrow statutory definition. See
`e.g., Blue Calypso, 815 F.3d at 1337, 1340 (CBM patent’s claim included
`‘recognizing a subsidy’ step to ‘financially induce’ participant action)
`(emphasis in original).” Unwired Planet, 841 F.3d at 1381. Here, we have
`applied the narrow statutory standard to evaluate CBM eligibility of claim 1.
`
`Patent Owner argues that a “click fraud detection system” is not itself
`a financial product, that its invention only perform a click reporting activity,
`and that it is the decision of the advertising operator whether to charge
`advertisers based on the click reports. Paper 31, 4–5. The argument is
`misplaced for several reasons. First, as discussed above, claim 1 recites a
`method for detecting fraudulent activity in a pay-per-click system, and the
`limitations of a pay-per-click system are essential to and required by claim 1.
`Second, whether the charges invoiced by the advertising operator to
`merchants are reduced based on clicking reports does not alter the fact that a
`pay-per-click system is itself a financial product and provides a financial
`service. Third, the financial product or service requirement of the statute
`refers to “a method or corresponding apparatus for performing data
`processing or other operations used in the practice, administration, or
`
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`management of a financial product or service.” AIA § 18(d)(1); 37 C.F.R.
`§ 42.301(a). Creating a clicking report on the basis of which an advertising
`operator can decide whether fraud has occurred and whether advertising
`charges to merchants should be reduced nevertheless constitutes activity in
`the administration or management of the pay-per-click system as a financial
`product or financial service, whether or not the effort actually results in
`reduction of advertising charges.
`
`Patent Owner argues that the invention of the ’763 patent “could be
`definitely [] used for almost any type of web search provider, search engines
`including also online voting system.” PO Resp. 27–28. Patent Owner notes
`also that in the Field of the Invention section of the Specification it is stated:
`“[T]his invention relates generally to network computing of the type which
`occurs over the Internet.” Id. at 40. Patent Owner argues that although only
`the pay-per-click system application is described in the Specification, the
`Board should not limit application of the ’763 patent to such a “single use.”
`Id. at 39–40. Specifically, Patent Owner notes that the invention of the ’763
`patent “can be used in an Online Polling System to detect invalid votes.”
`Id. at 40. Such arguments do not aid Patent Owner’s assertion that the ’763
`patent does not satisfy the financial product or service requirement of the
`statutory definition of a covered business method patent, because we focus
`specifically on the subject matter of claim 1.
`
`As explained above, a pay-per-click system is specifically recited in
`claim 1 as the application environment for the particular steps recited in the
`body of the claim. Also, as explained above, the recited pay-per-click
`system is necessary to give life, meaning, and vitality to the particular steps.
`In the context of the ’763 patent, where no other application environment is
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`described, the steps of claim 1, especially the step for detecting fraudulent
`activity, derive their meaning and significance only from the recited pay-per-
`click system. No other fraudulent activity related to duration between clicks
`is mentioned in the Specification.
`As determined above, claim 1 is limited to application of the recited
`steps to a pay-per-click system. We observe, additionally, that if the
`requirement of a pay-per-click system is deemed absent from claim 1, it
`would become unclear what, if anything, the particular steps recited in the
`body of claim 1 have to do with detecting fraudulent activity. In the context
`of the Specification of the ’763 patent, the potentially fraudulent activity and
`the pay-per-click system are inextricably bound. It is also the ’763 patent
`itself which expressly recites in claim 1 the pay-per-click system as the
`environment in which to detect fraudulent activity. We are not reading into
`claim 1 an extraneous limitation from the Specification. In that regard, note
`that an extraneous limitation is one that is added wholly apart from any need
`for the addition. See Hoganas AB v. Dresser Indus., Inc., 9 F.3d 948, 950
`(Fed. Cir. 1993); E.I. du Pont de Nemours & Co. v. Phillips Petroleum Co.,
`849 F.2d 1430, 1433 (Fed. Cir. 1988).
`
`For the foregoing reasons, we determine that the financial product or
`service requirement of the definition of a covered business method patent is
`met by claim 1 of the ’763 patent.
`
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`2. Technological Invention Exception
`Two Prongs of the Exception
`a.
`The definition of “covered business method patent” in § 18(d)(1) of
`the AIA excludes patents for technological inventions. When determining
`whether a patent is for a technological invention, we consider “whether the
`claimed subject matter as a whole [1] recites a technological feature that is
`novel and unobvious over the prior art; and [2] solves a technical problem
`using a technical solution.” 37 C.F.R. § 42.301(b). The first prong of the
`inquiry is not about whether the claimed invention is novel or nonobvious.
`Rather, even if the claimed method, as a whole, is novel and unobvious, the
`use of known technology in conventional ways does not render a patent a
`technological invention. See Office Patent Trial Practice Guide, 77 Fed.
`Reg. 48,756, 48,764 (Aug. 14, 2012).
`For the technological invention exception to apply in disqualifying a
`patent as a covered business method patent, both prongs of the inquiry must
`be met affirmatively, meaning that a negative answer under either prong
`renders inapplicable the technological invention exception. Apple, Inc. v.
`Ameranth, Inc., 842 F.3d 1229, 1240 (Fed. Cir. 2016) (“We need not address
`this argument regarding whether the first prong of 37 C.F.R. § 42.301(b)
`was met, as we affirm the Board’s determination on the second prong of the
`regulation—that the claimed subject matter as a whole does not solve a
`technical problem using a technical solution.”); see also Blue Calypso,
`815 F.3d at 1341 (addressing only whether the claimed invention solves a
`technical problem using a technical solution).
`In this case, because the requirements of the first prong are not met, as
`discussed below, we do not reach the second prong.
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`First Prong – Technological Feature, Novel and Unobvious
`b.
`The following claim drafting techniques, reciting technology,
`
`typically do not render a patent a technological invention:
`(a) Mere recitation of known technologies, such as
`computer hardware, communication or computer networks,
`software, memory, computer-readable
`storage medium,
`scanners, display devices or databases, or specialized machines,
`such as an ATM or point of sale device.
`
`
`(b) Reciting the use of known prior art technology to
`accomplish a process or method, even if that process or method
`is novel and non-obvious.
`
`
`(c) Combining prior art structures to achieve the normal,
`expected, or predictable result of that combination.
`
`Office Patent Trial Practice Guide, 77 Fed. Reg. at 48,763–64.
`Petitioner argues that all technological features in claim 1 were known
`at the time the applicati