In its Decision on Institution, the Board determined that it was more likely than not that at least one of the challenged claims is unpatentable, and instituted covered business method patent review of claims 1, 2, and 11-14 of the ’221 Patent, but denied review of claim 32. The ’221 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.”
The Board began with claim construction, stating that the claim terms are given their broadest reasonable interpretation in light of the specification. The Board construed the term “access rule,” recited in claim 32. The Board reviewed the ’221 Patent, and held that “access rule” is a rule specifying a condition under which access to content is permitted.
The Board then analyzed whether the ’221 Patent is a “covered business method patent.” The AIA defines “covered business method patent” as 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.” Only one claim must be directed to a covered business method to be eligible for review.
Reviewing first whether the ’221 Patent discloses a financial product or service, Petitioner asserted that claim 12 relates to financial activity because it “describes electronically transferring money and allowing such a transfer.” Patent Owner disagreed stating that the financial-in-nature requirement should be interpreted narrowly to cover only technology used specifically in the financial or banking industry. The Board disagreed with Patent Owner, and held that “financial product or service” should be interpreted broadly. Patent Owner also argued that claim 12 is not directed to an apparatus or method that is financial in nature because it “omits the specifics of how payment is made.” The Board was not persuaded by this argument because the AIA does not include such a requirement. Therefore, the Board found that at least one claim of the ’221 Patent meets the financial-in-nature requirement.
Turning to the technological invention exclusion, Petitioner asserted that claim 12 “does not recite a technological feature that is novel and unobvious” or “solve a technical problem using a technical solution.” Patent Owner argued that claim 12 recites at least one technological feature. The Board found that claim 12 as a whole does not recite a technological feature that is novel and unobvious over the prior art and instead recites elements that were known in the prior art. Therefore, the Board found that at least claim 12 does not recite a technological invention, and that the ’221 Patent is eligible for CBM review.
The Board then examined whether claims 1, 11, 12, and 32 are anticipated by Stefik ’235 and Stefik ’980. The Board found that Petitioner did not show that every limitation of claims 1, 11, 12, and 32 are set forth in the prior art in the same form and order as the claim. Petitioner relied upon the Stefik ’980 repository for many of the disclosures, but did not establish that either Stefik ’980 or Stefik’235 discloses a system using repositories in the same form and order as in claims 1, 11, 12, and 32.
Next, the Board reviewed Petitioner’s additional grounds based on Stefik ’235 and Stefik ’980: that claims 1, 11, 12, and 32 would have been obvious over the Stefik references alone, and that claims 1, 2, 11-14, and 32 would have been obvious over Stefik combined with Poggio and/or Sato. The Board found Petitioner’s contentions that claims 1, 2, and 11-14 would have been obvious persuasive, but not that claim 32 would have been obvious.
Regarding claims 1, 11, and 12, the Board found it is more likely than not that claims 1, 11, and 12 are unpatentable as obvious over the combined teachings of the Stefik references. The Board was not persuaded by Patent Owner’s argument that there is no evidence that one of ordinary skill in the art would have combined the references because Stefik ’235 does not identify sufficiently Stefik ’980. One reference need not identify explicitly another reference in order to form the basis for an obviousness combination. The Board also found that Petitioner provided a sufficiently articulated reasoning to support legal conclusions of obviousness. The Board declined to institute trial on the grounds that claims 1, 11, and 12 would have been obvious over Stefik combined with Poggio and/or Sato as redundant.
The Board then turned to claims 2, 13, and 14, finding that Petitioner established that it is more likely than not that those claims would have been obvious over the combination of Stefik ’235, Stefik ’980, and Poggio. The Board was not persuaded by Patent Owner’s argument that because Petitioner has not proven that the Stefik references qualify as a single reference, all combinations including those references fail. The Board found that Petitioner provided a sufficiently articulated reasoning to support the conclusion of obviousness over the Stefik references in combination with the teachings of Poggio. The Board declined to institute review on the asserted grounds that claims 2, 13, and 14 would have been obvious over the Stefik references combined with Sato or both Poggio and Sato as redundant.
Turning to claim 32, Petitioner relied upon Stefik’s usage rights as a disclosure of the requisite “access rule.” The Board found that Petitioner provided insufficient information as to how Stefik’s “usage rights” operate or why “usage rights” satisfy “access rule.”
The Board then addressed Petitioner’s argument that claims 1, 2, 11-14, and 32 would have been obvious over Ginter. Regarding claims 1, 2, and 11-14, the Board found that Petitioner established that it is more likely than not that those claims are unpatentable as obvious over Ginter. The Board was not persuaded by Patent Owner’s argument that Petitioner did not provide evidence that one of ordinary skill in the art would have modified Ginter in a way to render obvious the claimed subject matter. Regarding claim 32, the Board again found that Petitioner did not sufficiently explain how Ginter discloses “access rule.”
The Board then addressed additional grounds based on Ginter, declining to institute review on those grounds as to claims 1, 2, and 11-14 because they are redundant of the grounds already instituted. Regarding claim 32, the Board found that the additional grounds do not cure the deficiency in the challenge with respect to claim 32 based on obviousness over Ginter alone.
Apple Inc. v. Smartflash LLC, CBM2014-00102; CBM2014-00103
Paper 8: Decision on Institution of Covered Business Method Patent Review
Dated: September 30, 2014
Patent: 8,118,221 B2
Before: Jennifer S. Bisk, Rama G. Elluru, Neil T. Powell, Jeremy M. Plenzler, and Matthew R. Clements
Written by: Bisk
Related Proceedings: Smartflash LLC v. Apple Inc., No. 6:13-cv-447 (E.D. Tex.); Smartflash LLC v. Samsung, No. 6:13-cv-448 (E.D. Tex.); CBM2014-00104; CBM2014-00105; CBM2014-00106; CBM2014-00107; CBM2014-00108; CBM2014-00109; CBM2014-00110; CBM2014-00111; CBM2014-00112; CBM2014-00113