Paper 20
`Entered: November 27, 2015
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`Trials@uspto.gov
`Tel: 571-272-7822
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`UNITED STATES PATENT AND TRADEMARK OFFICE
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`_______________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`_______________
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`SQUARE, INC.,
`Petitioner,
`
`v.
`
`THINK COMPUTER CORPORATION,
`Patent Owner.
`_______________
`
`Case CBM2015-00067
`Patent 8,396,808 B2
`_______________
`
`
`
`Before TONI R. SCHEINER, MICHAEL W. KIM, and
`BART A. GERSTENBLITH, Administrative Patent Judges.
`
`KIM, Administrative Patent Judge.
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`
`
`DECISION ON REQUEST FOR REHEARING
`37 C.F.R. §§ 42.5, 42.71(d)
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`On January 29, 2015, Petitioner filed a Petition for Covered Business
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`Method Patent Review of U.S. Patent No. 8,396,808 B2. Paper 3. Patent
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`Owner filed a Preliminary Response. Paper 9, “Prelim. Resp.” On June 10,
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`2015, Petitioner filed a Reply to Preliminary Response (Paper 11), at the
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`Board’s request, concerning the applicability of 35 U.S.C. § 325(d) to this
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`CBM2015-00067
`Patent 8,396,808 B2
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`proceeding. Patent Owner filed a Sur-Reply. Paper 12, “Sur-Reply.” On
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`July 2, 2015, the Board denied the Petition, citing 35 U.S.C. § 325(d).
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`Paper 14, “Dec.” Petitioner filed a Request for Rehearing. Paper 15 (citing
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`Exs. 1026–1028), “Req.” For the reasons set forth below, the Request is
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`denied.
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`A request for rehearing can only point out that which the Board
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`misapprehended or overlooked, and will be reviewed for abuse of discretion.
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`37 C.F.R. § 42.71(d). Moreover, as the moving party, the burden of
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`persuasion falls on Petitioner. 37 C.F.R. § 42.20(c). To that end, Petitioner
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`sets forth two categories of assertions, each of which we will address in turn.
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`1. Patent Owner Harassment
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`Petitioner asserts the following:
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`the Board overlooked that agreement between the parties to
`pursue the proposed grounds in the present CBM proceeding
`mitigates concerns of PO harassment, a central concern in
`deciding whether to exercise discretion not to institute review
`under § 325(d). By failing to take this factor into consideration,
`the Board was unable to properly weigh the relevant factors.
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`Req. 1, 3–8. As an initial matter, Petitioner’s assertion is misplaced because
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`the parties’ conduct was not misapprehended or overlooked – it was
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`intentionally disregarded, as untimely. Dec. 9. Even if we were delve
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`substantively into the conduct, however, Petitioner’s assertion is misplaced
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`because central to Petitioner’s premise is that there was an agreement to
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`overlook with respect to § 325(d). We find, however, no evidence of such
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`an agreement. Absent such an agreement, there was nothing for the Board to
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`misapprehend or overlook in exercising its discretion under § 325(d).
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`Specifically, according to Patent Owner, while the parties apparently
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`expressed an agreement concerning joinder, no such agreement was reached
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`2
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`CBM2015-00067
`Patent 8,396,808 B2
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`concerning § 325(d). Prelim. Resp. 1–7; Sur-Reply 1–2; see also Exs. 1026,
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`1028. An agreement requires express acquiescence of two parties to specific
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`terms. Absent such express acquiescence, there is no agreement. As Patent
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`Owner asserts repeatedly that it did not agree to forgo arguments concerning
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`§ 325(d), and Petitioner has not presented sufficiently persuasive evidence to
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`the contrary, we do not have an adequate basis to find that there was any
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`agreement concerning § 325(d) between the parties.
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`Petitioner now asserts that “PO’s preliminary response was in direct
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`contradiction with at least the spirit of its agreement, if not the agreement
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`itself, that the most economical manner of addressing the prior art was the
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`67 Petition.” Req. 5. Thus, it appears that Petitioner requests that the Board
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`determine that Patent Owner’s conduct violated a spirit of an agreement, and
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`thus, that this violation should be held against Patent Owner. As an initial
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`matter, we are unclear as to how we can determine the terms of a spirit of an
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`agreement. Moreover, while we have no doubt that Petitioner feels misled,
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`Petitioner is asking the Board essentially to force Patent Owner to give up its
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`opportunity to set forth a substantive position that it is entitled to take, based
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`on this unspecified spirit of an agreement. We decline to do so.
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`Petitioner asserts further that after the Preliminary Response was filed,
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`“[h]aving already addressed the topic of the parties’ agreement and the basis
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`for the 67 Petition, Square did not initially believe further attention from the
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`Board was required.” Req. 6. We are unpersuaded that Petitioner’s position
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`is reasonable. If any agreement was reached between the parties to not
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`address § 325(d), and yet the Preliminary Response is directed almost
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`entirely to the issue of § 325(d), we are unclear as to why Petitioner believed
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`Patent 8,396,808 B2
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`that no further attention was necessary. Indeed, Petitioner did eventually
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`bring this issue to the attention of the Board.
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`Petitioner asserts also that the Board’s denial of the Petition will force
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`Petitioner to expend additional resources in District Court, which will be
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`contrary to the purpose of these proceedings to come to a “just, speedy, and
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`inexpensive resolution” and be a “quick and cost effective alternative to
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`litigation.” Req. 7–8. Petitioner’s assertions are misplaced because the
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`provision for a “just, speedy, and inexpensive resolution” is with regards to
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`each proceeding before the Board, and is not related to District Court
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`proceedings. With respect to a “quick and cost effective alternative to
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`litigation,” while that is certainly a consideration, the inclusion of § 325(d)
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`in the statute indicates that Congress desired a balance between many
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`competing considerations, and we are unpersuaded our exercise of that
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`discretion under § 325(d) was performed in a manner that did not account
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`properly for this consideration, for the reasons set forth herein and in the
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`Decision.
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`Petitioner asserts additionally that it elected not to file a request for
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`rehearing in CBM2014-00159 in reliance on the agreement with Patent
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`Owner. Our analysis is the same as set forth above, and need not be
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`repeated.
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`2. Board’s Historic Application of § 325(d)
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`Petitioner asserts the following:
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`A review of relevant case law demonstrates a distinction
`between follow-on petitions that address threshold deficiencies
`and follow-on petitions that use the PTAB’s previous decision
`on the merits as a road map to address deficiencies under
`§§ 102 and 103. Here, the Board declined to institute review in
`the initial petition for CBM review as to claims 8 and 19 on the
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`4
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`CBM2015-00067
`Patent 8,396,808 B2
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`basis that Square had not demonstrated that one of the cited
`prior art references, Ondrus I, qualified as a citable reference, a
`threshold issue. The Board did not analyze Ondrus I on the
`merits or in view of the claims and, consequently, there existed
`no road map to bolster any alleged deficiencies under the
`proposed obviousness grounds. As the 67 Petition cures a
`threshold issue and the grounds of unpatentability were not
`previously considered on the merits, a similar analysis as set
`forth in the line of cases in which discretion to decline review
`under § 325(d) has not been exercised were on point and should
`have been applied. The Decision makes no reference to these
`cases, thereby indicating they were overlooked.
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`Req. 1–2, 8–12. Essentially, Petitioner makes two related assertions: (1) that
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`whether Ondrus I is a prior art reference is a threshold issue, and thus,
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`§ 325(d) is inapplicable because § 325(d) has only been applied to issues on
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`the merits; and (2) by failing to address other cases of the Board concerning
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`§ 325(d), the Board misapprehended or overlooked those decisions. We are
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`unpersuaded by either argument.
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`Concerning argument (1), we are unpersuaded that whether a
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`reference is properly prior art is not an issue on the merits. Both §§ 102 and
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`103 recite express limitations on the type of prior art that may be considered
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`in evaluating a claimed invention, and there is a plethora of lengthy opinions
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`from our reviewing court where the entire case turns on whether or not a
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`particular reference is prior art. Accordingly, we consider that whether a
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`reference is properly prior art is a quintessential issue on the merits, and
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`given this, we are unpersuaded that § 325(d) is inapplicable on this basis.
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`To be sure, whether a reference is properly a prior art reference is a
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`threshold issue in an analysis under §§ 102 and 103, but we are unpersuaded,
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`in these circumstances, that it is not an issue on the merits. To hold
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`otherwise could potentially encourage petitioners to present the bare
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`CBM2015-00067
`Patent 8,396,808 B2
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`minimum of evidence in support of its position as to whether a reference is
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`properly prior art, as those petitioners may expect to be afforded a
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`potentially unlimited number of subsequent opportunities to bolster any such
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`deficiencies in future follow-on petitions.
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`Concerning argument (2), we are unpersuaded that a failure to
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`distinguish other cases concerning § 325(d) expressly in the Decision
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`indicates that the Board misapprehended or overlooked those decisions. As
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`an initial matter, there is no decision concerning § 325(d) from the Board
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`that is precedential, and insofar as Petitioner may be asserting that the Board
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`misapprehended or overlooked specific non-precedential decisions cited in
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`its pleadings, we see no need to expressly distinguish non-precedential
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`decisions which are persuasive authority only.
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`In any event, we reconsider expressly those specifically cited
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`decisions, and determine that those decisions are consistent with our
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`application of § 325(d) in this proceeding. Specifically, those decisions
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`counsel against allowing a petitioner a “second bite of the apple” using a
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`road-map set forth in a denial of a petition or ground of unpatentability.
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`Such a consideration is exactly relevant here, where our decision in
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`CBM2014-00159 provided Petitioner with a substantive road-map on how to
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`present Ondrus II in a manner sufficient to overcome the substantive
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`deficiencies of Ondrus I.
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`IT IS ORDERED that, insofar as we have addressed above the
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`arguments set forth in Petitioner’s Request for Rehearing (Paper 15) and
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`found them unpersuasive, the Request is denied.
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`6
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`

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`CBM2015-00067
`Patent 8,396,808 B2
`
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`For PETITIONER:
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`Michael T. Rosato
`Robin L. Brewer
`WILSON SONSINI GOODRICH & ROSATI, P.C.
`mrosato@wsgr.com
`rbrewer@wsgr.com
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`
`
`For PATENT OWNER:
`
`Sean Goodwin
`Michael Aschenbrener
`ASCHENBRENER LAW, P.C.
`sgg@aschenbrenerlaw.com
`mja@aschenbrenerlaw.com
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`7