In its Final Written Decision, the Board held that claims 1-19 of the ’894 patent are unpatentable. The Board also denied Patent Owner’s Motion to Recuse Judge McNamara.
Petitioner challenged the patentability of the ’894 as follows: (1) claims 1, 3-5, 8, 14, 15, 17, and 18 as obvious over Chelliah and Lawlor, (2) claims 2, 6, 9, 10, 12, and 16 as obvious over Chelliah and Edwards, (3) claims 7 and 13 as obvious over Chelliah, Edwards, and CompuServe, (4) claim 11 as obvious over Chelliah, Edwards, and Bartlett, and (5) claim 19 as obvious over Chelliah, Edwards, Lawlor, and Bartlett.
Before addressing the merits, the Board addressed Patent Owner’s request for recusal of Judge McNamara. Patent Owner alleged that Judge McNamara had a conflict of interest because he possesses financial holdings in diversified funds and in Microsoft. The Board stated that under 37 C.F.R. § 42.120(a), a patent owner may file a response to the petition addressing any ground for unpatentability not already denied. Judge McNamara elected to respond to Patent Owner’s request given that she repeatedly raised the issue. Judge McNamara noted that Patent Owner has a history of accusing judges and attorneys of having a conflict of interest. Judge McNamara provided several reasons why Patent Owner’s request is unjustified. Also, Patent Owner allegedly attempted to publish Judge McNamara’s financial holdings, along with a threatening photo of Judge McNamara superimposed on a target with a skull and crossbones. This was perceived as an attempt to intimidate. Patent Owner’s Motion to Recuse was denied.
The Board also noted that Patent Owner (1) questioned the integrity and competence of the panel, Petitioner’s counsel, and Petitioner’s witness, (2) alleged incompetence of Patent Owner’s own counsel, and (3) alleged that post-grant proceedings are a “sham process.” The Board concluded that Patent Owner’s assertions were unsubstantiated.
The ’894 patent purports to facilitate real-time two-way transactions as opposed to deferred transactions. The Board construed several terms of the ’894 patent, including: Web transaction, Web and Internet, Web application, POSvc application, facilities network, service network, various network-related terms, value-added network (VAN) service, Internet cloud application, web merchant, object, information entries and attributes of an object, application layer routing of the object identity with the information entries and attributes, object routing, exchange, and back-end application. Patent Owner alleged that the Board reached a legally incorrect interpretation, without exploring the metes and bounds to which Patent Owner is entitled. The Board concluded that Patent Owner in many cases attempted to import an explanation contained in the written description into the claim limitations. The claim constructions applied in the Decision to Institute were adopted by the Board.
Turning to the merits, Patent Owner alleged that the prior art does not disclose a POSvc application. In particular, Patent Owner alleged that Chelliah does not disclose or suggest use of a Web application and that none of the prior art teaches or suggests use of a POSvc Web application. Patent Owner alleged that the ’894 patent is distinguished over the prior art in which a user can perform a transaction using a personal computer by activating application software on a PC to access a bank account and dialing into a bank modem. The Board disagreed, noting that Chelliah is not limited to implementations using the Internet or Web. Chelliah discloses that the user interface can be implemented to present items available for purchase to the customer using icons in an interactive system such as an online service.
Patent Owner alleged that Chelliah discloses the possible use of Common Object Request Broker Architecture (CORBA), CORBA has nothing to do with user interfaces or Web browsers. Edwards, discloses the replacement of CGI scripts with CORBA in a theatre ticket application. Patent Owner argued that CGI and CORBA are not interchangeable. The Board was unpersuaded by Patent Owner’s argument, noting that Patent Owner failed to recognize that the issue is not interchangeability of CGI and CORBA, but the combination of the prior art under 35 U.S.C. § 103. The Board concluded that Petitioner had demonstrated by a preponderance of the evidence that the combination of Edwards and Chelliah disclose many of the limitations of the claims of the ’894 patent.
The Board concluded that one of ordinary skill in the art would have been motivated to combine Chelliah, which describes the use of a CORBA architecture in a commercial transaction network, with Edwards, which describes an implementation of a commercial transaction, such as purchasing theater tickets using CORBA instead of CGI scripts. Further, the Board determined that Patent Owner’s Response does not address the specific challenges on which inter partes review was instituted. Thus, the Board concluded that Petitioner has established by a preponderance of the evidence that the challenged claims are unpatentable.
SAP AMERICA, INC. v. LAKSHMI ARUNACHALAM, IPR2014-00413
Paper 26: Final Written Decision
Dated: August 17, 2015
Before: Karl D. Easthom, William V. Saindon, and Brian McNamara
Written by: McNamara
Related proceedings: Pi-Net International, Inc. v. JPMorgan Chase & Co., No. 1:12-cv-00282 (D. Del. May 14, 2014); Pi-Net International, Inc. and Dr. Lakshmi Arunachalam v. JPMorgan Chase & Co., 2015 U.S. App. LEXIS 7126 (Fed. Cir. Apr. 20, 2015); Pi-Net Int’l., Inc. v. JPMorgan Chase & Co., 42 F. Supp. 3d 579 (D. Del. 2014).