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`Trials@uspto.gov
`Tel: 571-272-7822
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`Paper 35
`Entered: May 24, 2017
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`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`WALGREEN CO., AHOLD USA, INC., DELHAIZE AMERICA, LLC,
`AND PUBLIX SUPER MARKETS, INC.,
`Petitioner,
`
`v.
`
`ADVANCED MARKETING SYSTEMS, LLC,
`Patent Owner.
`
`Cases CBM2016-00014 and CBM2016-00015
`Patent 8,370,199 B2
`
`Before THOMAS L. GIANNETTI, TREVOR M. JEFFERSON, and
`MITCHELL G. WEATHERLY, Administrative Patent Judges.
`
`WEATHERLY, Administrative Patent Judge.
`
`FINAL WRITTEN DECISION
`35 U.S.C. § 328(a), 37 C.F.R. § 42.73
`
`I.
`
`INTRODUCTION
`
`A. BACKGROUND
`Walgreen Co., Ahold USA, Inc., Delhaize America, LLC, and Publix
`Super Markets, Inc. (collectively “Petitioner”) filed a petition (Paper 2,1
`
`1 Unless otherwise noted, citations to Paper numbers reflect the Paper
`numbers in both CBM2016-00014 and -00015. When citations differ, we
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`Patent 8,370,199 B2
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`“Pet.”) requesting a covered business method patent review (“CBM review”)
`of claims 15 and 28 of U.S. Patent No. 8,370,199 B2 (Ex. 1001,2 “the
`’199 patent”) pursuant to section 18 of the Leahy-Smith America Invents Act
`(“AIA”). Petitioner supported the Petition with the Declaration of Michael
`Lewis, Ph.D. (Ex. 1009). Advanced Marketing Systems, LLC (“Patent
`Owner”) timely filed a Preliminary Response. Paper 5 (“Prelim. Resp.”).
`On May 27, 2016, and June 1, 2016, based on the record before us at the
`time, we instituted a CBM review of claims 15 and 28 in CBM2016-00014
`and -00015. Paper 6 (“Institution Decision” or “Dec.”). We instituted the
`review on the following challenges to claim 15 and 28:
`
`Reference/Alleged Defect
`
`Basis
`
`Claim(s)
`
`U.S. Patent No. 4,882,675 (Ex. 1007,
`“Nichtberger”)
`
`International Patent Publication No. WO
`96/30851 A1 (Ex. 1008, “Ovadia”)
`
`Lack of written description support
`
`§ 102(b)
`
`15 and 28
`
`§ 102(b)
`
`15
`
`§ 112, ¶ 1 28
`
`After we instituted this review, Patent Owner filed a Patent Owner
`Response in opposition to the Petition (Paper 22, “PO Resp.”) that was
`supported by the Declaration of Steven R. Kursh, Ph.D. (Ex. 2015).
`Petitioner filed a Reply in support of the Petition (Paper 31, “Reply”).
`
`
`will precede citations in CBM2016-00014 with “’014 CBM” and citations in
`CBM2016-00015 with “’015 CBM.”
`2 Unless otherwise noted, citations to Exhibit numbers reflect the Exhibit
`numbers in both CBM2016-00014 and -00015. When citations differ, we
`will precede citations in CBM2016-00014 with “’014 CBM” and citations in
`CBM2016-00015 with “’015 CBM.”
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`2
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`Patent Owner did not move to amend any claim of the ’199 patent. Neither
`party requested oral argument, and none was held.
`We have jurisdiction under 35 U.S.C. § 6(b). The evidentiary
`standard applicable to this proceeding is a preponderance of the evidence.
`See 35 U.S.C. § 326(e); 37 C.F.R. § 42.1(d). This Final Written Decision is
`issued pursuant to 35 U.S.C. § 328(a) and 37 C.F.R. § 42.73.
`For the reasons expressed below, we conclude that Petitioner has
`demonstrated by a preponderance of evidence that claims 15 and 28 are
`unpatentable.
`B. RELATED PROCEEDINGS
`Patent Owner has asserted the ’199 patent along with related U.S.
`Patent Nos. 8,219,445 B2 (“the ’445 patent) and 8,538,805 B2 (“the
`’805 patent”) against individual ones of the petitioners in the following
`district court proceedings: Advanced Mktg. Sys., LLC v. Walgreen Co., No.
`6:15-cv-00137 (E.D. Tex.); Advanced Mktg. Sys., LLC v. Ahold USA, Inc.,
`No. 1:15-cv-221 (E.D. Va.); Advanced Mktg. Sys., LLC v. Delhaize America,
`Inc., No. 2:15-cv-00074 (E.D. Va.); and Advanced Mktg. Sys., LLC v. Publix
`Super Markets, Inc., No. 3:15-cv-00247 (M.D. Fla.). Pet. 1–2; Paper 3, 1–2.
`Patent Owner has also asserted the ’445 patent, ’199 patent, and ’805 patent
`against other parties in the following district court proceedings: Advanced
`Mktg. Sys., LLC v. The Kroger Co., No. 3:14-cv-02065 (N.D. Tex.);
`Advanced Mktg. Sys., LLC v. Hy-Vee, Inc., No. 3:15-cv-00103 (W.D. Wis.);
`Advanced Mktg. Sys., LLC v. CVS Pharmacy, Inc., No. 6:15-cv-00134 (E.D.
`Tex.); Advanced Mktg. Sys., LLC v. Brookshire Grocery Co., No. 6:15-cv-
`00138 (E.D. Tex.); and Advanced Mktg. Sys., LLC v. Ingles Markets Inc.,
`No. 1:15-cv-00007 (W.D. Va.). Pet. 2; Paper 3, 2. We instituted a CBM
`
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`review of the ’805 patent in CBM2016-00013,3 and of the ’445 patent in
`CBM2016-00012.4
`C. THE ’199 PATENT
`The ’199 patent issued from an application filed on June 5, 2012, and
`claims priority to a number of prior applications, the earliest of which was
`filed on February 19, 1998. Ex. 1001, 1:4–20. Two of the applications in
`the priority chain are described as continuations-in-part of prior applications.
`See id. Neither party addresses the priority date to which claims 15 and 28
`are entitled. Nevertheless, Nichtberger is prior art to claims 15 and 28 under
`35 U.S.C. § 102(b) even if those claims were entitled to the priority date of
`February 19, 1998. See Ex. 1007 (issuing November 21, 1989).
`The ’199 patent relates to “a data processing system and method for
`implementing a customer incentive promotional program for enhancing
`retail sales of select products, such as groceries and the like.” Ex. 1001,
`1:25–28.
`Claim 15 is directed to a “discount vehicle” and recites:
`15[a]. A discount vehicle for use with a data processing
`system for tracking and processing a plurality of in-store
`discounts to potential purchasers of plural products during the
`checkout process, wherein said discounts are each associated
`with a specific one of said plural products, said discount vehicle
`comprising:
`[b] two or more of said discounts including descriptive material
`to provide information at least identifying the products and
`their associated discounts, wherein
`
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`3 CBM2016-00013, Paper 6.
`4 CBM2016-00012, Paper 7.
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`[c] said vehicle is associated with a select code that permits
`tracking of said vehicle and of individual purchasers'
`purchased products and
`the prices
`thereof during
`checkout,
`said select code uniquely identifying all the discounts for all
`of the plural products associated with said vehicle, and
`[d] said select code uniquely identifying said vehicle such that
`said select code can be selectively deactivated for only
`particular discounts, of
`the plurality of discounts,
`associated with the purchased products by redemption of
`the code associated with the vehicle such that the code
`remains active for future use with yet unused ones of the
`plurality of discounts associated with said plural products.
`Id. at 11:65–12:20 (line breaks and subdivisions [a]–[d] used by Petitioner
`added for clarity).
`The Specification describes one example of the claimed “discount
`vehicle” as a “multi-discount vehicle” (“MDV”) in the form of freestanding
`insert 300 which is distributed in a newspaper. Id. at 7:30–37. Freestanding
`insert 300 is illustrated in Figures 3A and 3B, which are reproduced below.
`
`Figure 3A is a front view of an
`MDV as freestanding insert 300.
`
`Figure 3B is a rear view of the
`freestanding insert 300.
`
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`The Specification describes freestanding insert 300 as follows:
`[O]ne embodiment of the MDV is provided in the form of a
`freestanding insert (FSI) 300. The FSI may generally take the
`form of a folded sheets 310, 320, 330 unattached to each other
`(FIGS. 3a-c). Each sheet presents graphically displayed
`information, is folded or creased 352, and may include at least
`one advertisement or commercial 340 of a discounted product.
`FSI is preferably placed in a newspaper for dissemination to
`potential customers.
`A redemption vehicle 312 is shown attached to one of the
`sheets, but may be attached to any of the sheets, in any position,
`may be printed on any portion, or may simply be loose and
`separate altogether. The redemption vehicle may include a
`barcode 360 or other readable medium, a description 314 of the
`discounted or sale-priced items, a picture or other representation
`318 of the items, and/or the price or discount 316 of the items.
`Id. at 7:30–44. The Specification describes other physical forms of the
`“discount vehicle” as flat card 400, id. at 7:60, and folded card 500, id.
`at 8:16. Flat card 400 and folded card 500 also include “redemption
`vehicles” having barcodes 460, 560 and descriptions 414, 514. Id. at 7:59–
`8:36. But for changes in reference numerals, all embodiments of the
`“discount vehicle” are described identically. See id. at 7:30–8:36.
`Claim 28 is directed to a “data processing system” and recites:
`28. [a] A data processing system for tracking and processing
`a plurality of in-store discounts to potential purchasers of plural
`products during the checkout process wherein said discounts are
`each associated with a specific one of said plural products, said
`system comprising:
`[b] a discount vehicle, characterized by two or more of said
`discounts, including descriptive material to provide
`information at least identifying the products and their
`associated discounts;
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`[c] a customer account associated with a customer
`identification code, the customer account comprising two
`or more of said discounts of the discount vehicle selected
`by a customer to be associated with the customer account,
`[d] the customer account being associated with a select code
`that permits tracking of said customer account during
`checkout, said code uniquely identifying all the discounts
`for all of the plural products associated with the customer
`account;
`[e] a checkout processing terminal including computer based
`tracking of individual purchasers’ purchased products and
`the prices thereof, wherein said processing terminal
`includes a device for receiving the customer identification
`code and the select code associated with the customer
`account during checkout; and
`[f] a data processor attached to said checkout terminal for
`receiving information regarding transactions associated
`with checkout, selected products and the discounts
`associated with the code associated with the customer
`account forming a part of the transactions, and processing
`said discounts in accord with said code;
`[g] wherein said data processor selectively deactivates the
`code for only particular discounts, of the plurality of
`discounts, associated with the purchased products by
`redemption of the code associated with the customer
`account such that the code remains active for future use
`with yet unused ones of the plurality of discounts
`associated with said plural products,
`[h] said data processor being further connected to memory for
`storing data associated with said transaction.
`Id. at 13:1–14:15 (line breaks and subdivisions [a]–[g] used by Petitioner
`added for clarity).
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`The Specification describes the
`manner in which the discount vehicle is
`used within the claimed data processing
`system in connection with Figure 1, which
`is reproduced at right. Customer 30
`receives an MDV via one of two paths,
`mail distribution 10 or newspaper 20. Id.
`at 6:17–21. Next, customer 30 visits retail
`store 40 with the MDV. Id. at 6:34–35.
`During checkout process 50, the MDV is
`scanned and checked for authenticity so
`that the system can track which discounted items were purchased and adjust
`the total amount charged to that customer accordingly. Id. at 6:35–40.
`In an example involving a super market, the customer may retain the
`MDV to use during the next trip to the super market. Ex. 1001, 10:7–8.
`During checkout, scanning equipment reads both the MDV and the products
`selected by the customer for purchase. Id. at 10:13–15. The scanning
`equipment is connected to a computer that compares the purchases with a
`file storing information regarding the products promoted on the MDV.
`Ex. 1001, 10:15–18. This comparison is facilitated by the unique identifier
`provided on the MDV, which associates the promotion to the stored file. Id.
`at 10:18–20.
`As promoted items listed on the MDV are scanned during checkout,
`the system flags these items as purchased and applies the discount to the
`prices provided to the customer. Id. at 10:20–23. The computer may
`thereafter deactivate the promotion for that product to ensure that the MDV
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`is not used again to duplicate the discount for the purchased items. Id.
`at 10:23–26. The MDV, however, remains active for unexpired discount
`offers on items not purchased by the customer during this or previous
`shopping visits, which allows the customer to return to the store with the
`MDV and obtain the unused discounts. Id. at 10:26–32.
`II. ANALYSIS
`A. WHETHER THE ’199 PATENT IS A COVERED BUSINESS METHOD
`PATENT
`A “covered business method patent,” as defined in the AIA, 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); accord
`37 C.F.R. § 42.301(a). In determining whether a patent is eligible for CBM
`patent review, the focus is on the claims. Secure Axcess, LLC v. PNC Bank
`Nat’l Ass’n, 848 F.3d 1370, 1379 (Fed. Cir. 2017) (“It is the claims, in the
`traditional patent law sense, properly understood in light of the written
`description, that identifies a CBM patent.”). One claim directed to a covered
`business method is sufficient to render the patent eligible for CBM patent
`review. See id. at 1381 (“the statutory definition of a CBM patent requires
`that the patent have a claim that contains, however phrased, a financial
`activity element.”)
`1. Financial Product or Service
`Petitioner argues that the “discount vehicle” of claim 15 is financial in
`nature because it is used during a retail transaction as part of “a customer
`incentive promotional program for enhancing retail sales of select products,
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`such as groceries and the like.” Pet. 5 (quoting Ex. 1001, 1:24–28). Patent
`Owner does not contest Petitioner’s argument on this issue, and we find
`Petitioner’s argument to be persuasive. Claim 15, while not a method claim,
`is directed to a “corresponding apparatus for performing data processing or
`other operations used in the practice, administration, or management of a
`financial product or service.” The Specification describes its invention as “a
`data processing system and method for implementing a customer incentive
`promotional program for enhancing retail sales of select products, such as
`groceries and the like.” Ex. 1001, 1:24–28. The Specification describes
`objectives of the invention and the manner in which the “discount vehicle” is
`an apparatus used to implement the “customer incentive promotional
`program for enhancing retail sales” as follows:
`It is a further object of the present invention to provide a
`promotion system for enhancing retail based distribution of
`goods through the use of a multi-product discount vehicle,
`selectively distributed to potential customers, via direct mail or
`newspaper insert.
`It is a further object of the present invention to provide a
`data processing system programmed to track redemptions of a
`specialized multi-product incentive vehicle, so as to insure
`proper discounting against select products and coordinated
`fulfillment of the incentive-based transaction.
`The above and other objects of the present invention are
`realized in a novel data processing system operable with a
`specialized multi-product discount vehicle associated with a
`specified code. The multi-product discount vehicle has within its
`structure, a coordinated presentation of coupon-like indicia,
`coupled with graphics and text to draw customer attention to the
`salient features of the promoted products.
`Id. at 4:6–23. These portions of the Specification indicate that the “discount
`vehicle” is an apparatus used in conjunction with the provision of discounts
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`applied to retail sales. Accordingly, we determine that claim 15, absent
`application of the exception for “technological inventions,” subjects the
`’199 patent to CBM review.
`2. Technological Invention Exception
`Before institution of trial, but not after institution, Patent Owner
`argued that claims 15 and 285 recite technological inventions that are exempt
`from CBM patent review. Prelim. Resp. 5–9; see generally PO Resp. (not
`addressing eligibility of ’199 patent for CBM review).
`Patents subject to CBM patent review “do[] not include patents for
`technological inventions.” AIA § 18(d)(1); accord 37 C.F.R. § 42.301(a).
`The technological invention exception in the definition of a covered business
`method patent is not met by “[m]ere recitation of known technologies, such
`as computer hardware, . . . or specialized machines, such as an ATM or point
`of sale device,” or “[c]ombining prior art structures to achieve the normal,
`expected, or predictable result of that combination.” Office Patent Trial
`Practice Guide, 77 Fed. Reg. 48,756, 48,763–64 (Aug. 14, 2012). To
`determine 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); see CBM Final Rules, at 48,736. Both the first and second
`
`
`5 The presence of one claim in a patent that is directed to a financial product
`or service is sufficient to render a patent subject to CBM review. See Secure
`Axcess, 848 F.3d at 1381 (“the statutory definition of a CBM patent requires
`that the patent have a claim that contains, however phrased, a financial
`activity element.”). We address Patent Owner’s pre-institution arguments
`relating to claim 15.
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`prong must be met for the technological invention exception to apply.
`Agilysys, Inc. v. Ameranth, Inc., Case CBM2014-00014, slip op. at 11
`(PTAB Mar. 26, 2014) (Paper 19); see Google Inc. v. Inventor Holdings,
`LLC, Case CBM2014-00002, slip op. at 10 (PTAB Apr. 1, 2014) (Paper 16);
`157 Cong. Rec. S1364 (daily ed. Mar. 8, 2011) (statement of Sen. Schumer).
`Petitioner argues that because claim 15 encompasses a paper coupon
`as described in the Specification, claim 15 “is in no way technical.” Pet. 15.
`Before institution of trial, Patent Owner countered that claim 15, when
`“viewed as a whole,” recites novel and unobvious technological features that
`solve a technical problem using a technical solution. Prelim. Resp. 5–9.
`Nevertheless, Patent Owner fails to identify how the recited “discount
`vehicle” encompasses a single feature that is “technological” or how the
`“discount vehicle” provides any technical solution to a technical problem.
`Id. Patent Owner contends that the inventors of the ’199 patent “invented a
`solution rooted in computer technology to overcome a problem specifically
`arising in the realm of computer networks.” Id. at 7. However, Patent
`Owner cites no particular part of claim 15 or evidentiary support for its
`contention that the “discount vehicle” of claim 15 recites anything other than
`the vehicle itself. Id. at 5–9. After institution of trial, Patent Owner did not
`argue that the ’199 patent was not eligible for CBM review.
`As explained in part II.B.1 below, we determine that claim 15 recites a
`“discount vehicle” bearing a “select code” that is intended to be read by
`scanning equipment and used by a “data processing system” to determine
`how to provide a discount to a potential purchaser of products “during the
`checkout process.” Nevertheless, claim 15 encompasses none of the devices
`used to scan and process the select code. Instead, claim 15 encompasses the
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`discount vehicle itself and the markings that make it compatible with the
`unclaimed “data processing system” and the unclaimed “machine” that is
`able to read the select code. Accordingly, Petitioner persuades us that the
`technological exception does not apply to the ’199 patent.
`3. Summary
`For the reasons expressed above, we find that at least claim 15 renders
`the ’199 patent subject to CBM review.
`B. CLAIM INTERPRETATION
`“A claim in an unexpired patent shall be given its broadest reasonable
`construction in light of the specification of the patent in which it appears.”
`37 C.F.R. § 42.200(b); see also Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct.
`2131, 2142 (2016) (affirming that USPTO has statutory authority to construe
`claims according to similarly written Rule 42.100(b)). When applying that
`standard, we interpret the claim language as it would be understood by one
`of ordinary skill in the art in light of the specification, and absent any special
`definition, we give claim terms their ordinary and customary meaning. See
`In re Suitco Surface, Inc., 603 F.3d 1255, 1260 (Fed. Cir. 2010); In re
`Translogic Tech., Inc., 504 F.3d 1249, 1257 (Fed. Cir. 2007) (“The ordinary
`and customary meaning is the meaning that the term would have to a person
`of ordinary skill in the art in question.” (internal quotation marks omitted)).
`Only terms which are in controversy need to be construed, and then only to
`the extent necessary to resolve the controversy. See Vivid Techs., Inc. v. Am.
`Sci. & Eng’g, Inc., 200 F.3d 795, 803 (Fed. Cir. 1999). Based on the
`arguments and evidence adduced by the parties, we interpret various aspects
`of claims 15 and 28 as discussed below.
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`1. Elements of the “discount vehicle”
`a) Claim 15
`At a high level, claim 15 affirmatively recites a “discount vehicle”
`(e.g., multi-discount vehicles (“MDV”) 300, 400, 500) having only two
`physical elements. Namely, claim 15 recites “descriptive material” that
`provides information identifying products (e.g., descriptions 314, 414, 514
`and pictures 318, 418, 518) and associated discounts (e.g., discounts 316,
`416, 516) and a “select code” (e.g., barcodes 360, 460, 560). Among other
`things, the “select code” identifies “all the discounts” for all the products.
`Ex. 1001, 7:30–8:48. The claim also recites a functional capability of the
`discount vehicle as being “for use with a data processing system.” Id.
`at 11:65–66. Nevertheless, claim 15, by its plain terms, does not encompass
`the “data processing system.” Id.
`b) Claim 28
`Claim 28 recites a “discount vehicle” even more broadly than claim
`15 in the sense that the discount vehicle of claim 28 need only include
`“descriptive material to provide information at least identifying the products
`and their associated discounts.” Id. at 13:6–9. The select code is recited as
`“being associated” with a “customer account” that “permits tracking of said
`customer account during checkout.” Id. at 13:13–16. The “select code,”
`therefore, need not appear on or be associated with the discount vehicle.
`2. Whether the “discount vehicle” encompasses a website or
`mobile application
`Before trial was instituted, the parties’ competing interpretations of
`“discount vehicle” in claim 15 focused on whether the term narrowly covers
`only paper versions of the vehicle, like those explicitly described in the
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`Specification, ’014 CBM Pet. 20–26, ’015 CBM Pet. 20–27, or more
`broadly also covers “a website, or a mobile application,” ’014 CBM Prelim.
`Resp. 9–16, ’015 CBM Prelim. Resp. 9–17. In our Institution Decision, we
`did not resolve this dispute because Petitioner had demonstrated that
`claim 15 was more likely than not anticipated by the paper discount vehicles
`described by each of Nichtberger, ’014 CBM Dec. 11, and Ovadia,
`’015 CBM Dec. 11. Based on the record before us, we conclude that we still
`need not resolve this specific dispute because Petitioner has demonstrated,
`by a preponderance of evidence, that the paper-based discount vehicles
`described by each of Nichtberger and Ovadia anticipate claim 15.
`3. Claim 28: “the code” and “said code”
`Claim 28 introduces two different “codes” as follows: “a customer
`account associated with a customer identification code . . . the customer
`account being associated with a select code.” Ex. 1001, 13:10–14 (emphasis
`added). Claim 28 later refers to either “the code” or “said code” five times
`as follows:
`said code uniquely identifying all the discounts
`* * *
`the code associated with the customer account forming a part of
`the transactions, and processing said discounts in accord with
`said code
`
`* * *
`redemption of the code associated with the customer account
`such that the code remains active for future use . . . .
`Id. at 13:16–14:11 (emphases added). To address uncertainty regarding
`which “code” is the antecedent for “the code” and “said code,” we instructed
`both parties to address during the trial whether each instance of “the code”
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`or “said code” recited later in claim 28 refers to the “customer identification
`code” or the “select code” and the manner in which claim 28 meets the
`requirement under 35 U.S.C. § 112, ¶ 2 of “particularly pointing out and
`distinctly claiming the subject matter which the applicant regards as his
`invention.” Dec. 11–12, n.2.
`Petitioner argues in its Reply that “[b]ecause both the customer
`identification code and the select code are associated with the customer
`account, it is impossible to determine which of the two codes are referenced
`by ‘the code associated with the customer account.’” Petitioner argues that
`the ambiguity renders claim 28 unpatentable as indefinite under 35 U.S.C.
`§ 112, ¶ 2. ’015 CBM Reply 25. Petitioner proffers no evidence on the
`issue of whether an ordinarily skilled artisan would have considered the
`meaning of claim 28 to have been set forth with reasonable certainty. See id.
`at 25–26 (failing to support its argument for indefiniteness with any expert
`testimony). Patent Owner contends that Petitioner fails to present “evidence
`demonstrating that the claims, when read in context, are not understood by
`persons of ordinary skill in the art with reasonable certainty.” ’015 CBM PO
`Resp. 49. We also note that the District Court, in related litigation between
`Petitioner and Patent Owner, has rejected Petitioner’s argument that claim 28
`is indefinite based on its recitations of “the code” and “said code,” and
`instead ruled that both phrases refer to the “select code” of claim 28.
`Ex. 2018, 30–36.
`We agree with and adopt as our own the District Court’s analysis of
`“the code” and “said code” as recited in claim 28, whether we apply the
`standard for evaluating indefiniteness under In re Packard, 751 F.3d 1307
`(Fed. Cir. 2014) or Nautilus, Inc. v. Biosig Instruments, Inc., 134 S. Ct. 2120,
`
`16
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`CBM2016-00014 and CBM2016-00015
`Patent 8,370,199 B2
`
`(2014). Accordingly, we determine that Petitioner has failed to establish by
`a preponderance of evidence that claim 28 is indefinite due to its recitations
`of “the code” and “said code.” We also determine that “the code” and “said
`code” refer to the “select code” when considering whether Nichtberger
`anticipates claim 28.
`4. “select code can be selectively deactivated for only particular
`discounts”
`Claim 15 recites that the “select code can be selectively deactivated
`for only particular discounts, . . . by redemption of the code associated with
`the vehicle.” Ex. 1001, 12:14–17. Claim 28 similarly recites that “said data
`processor selectively deactivates the code for only particular discounts, . . .
`by redemption of the code associated with the customer account.” Id.
`at 14:7–11. Both claims also require that after selective deactivation, “the
`code remains active for future use with yet unused” discounts. Id. at 12:17–
`18 (claim 15), 14:11–12 (claim 28).
`The Specification sheds light on the meaning of “selectively
`deactivated” when it describes the process of selectively deactivating the
`select code as follows:
`At check-out, the super market employs conventional
`scanning equipment to read both the MDV and the products
`selected by the customer for purchase. The scanning equipment
`is connected to a computer that compares the purchases with a
`file storing information regarding the products promoted with the
`MDV. This comparison is facilitated by the unique identifier
`provided on the MDV, which comports the promotion to the
`stored file. As promoted items listed on the MDV are scanned
`during checkout, the system flags these items as purchased and
`applies the discount to the price provided to the customer. The
`computer may thereafter deactivate the promotion for that
`product to insure that the MDV is not used again to duplicate the
`discount for the purchased items. The MDV, however, remains
`
`17
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`CBM2016-00014 and CBM2016-00015
`Patent 8,370,199 B2
`
`active to the extent promoted items were not purchased by the
`customer during this or previous shopping visits, and the time
`period set for the promotion has not expired (typically 45 to 90
`days). This, of course, allows the customer to return to the store
`with the MDV and to take advantage of the remaining
`promotions on the MDV that have not been used.
`Id. at 10:13–32 (emphasis added). This passage indicates that the barcode
`(i.e., “select code”) associated with the discount vehicle is not modified
`during the process of selectively deactivating the select code for only those
`products for which the customer has redeemed the code and received a
`discount. Instead, a computer modifies a “file storing information regarding
`the products promoted” on the discount vehicle to deactivate the code
`regarding the discount associated with a purchased item while leaving the
`code active for the discounts associated with the promoted items not yet
`purchased. Rather, claim 15 expressly covers only the discount vehicle
`itself, and neither claim 15 nor claim 28 requires any alteration to the select
`code when it is “selectively deactivated.” Accordingly, we determine that:
`(1) claim 15 does not encompass the computer (i.e., the recited “data
`processing system”) that modifies the file storing information regarding
`promoted products, and (2) neither claim 15 nor claim 28 requires that the
`select code associated with the discount vehicle be altered to reflect selective
`deactivation.
`5. “during the checkout process”
`At trial, Patent Owner argues that “all of the terms utilized in the
`preamble are limiting” with respect to claims 15 and 28. ’014 CBM PO
`Resp. 9; ’015 CBM PO Resp. 13. Specifically, Patent Owner argues that the
`term “during the checkout process” recited in the preamble limits the
`“structure and intended purpose” of the discount vehicle recited in the body
`
`18
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`CBM2016-00014 and CBM2016-00015
`Patent 8,370,199 B2
`
`of the claim, such that the discount vehicle must be “selectively deactivated”
`during checkout.6 ’014 CBM PO Resp. 10; ’015 CBM PO Resp. 14.
`Patent Owner’s argument that neither Nichtberger nor Ovadia
`anticipates claim 15 relies in part upon its contention that selective
`deactivation of discounts must occur during checkout and not later. See
`’014 CBM PO Resp. 42–52 (regarding Nichtberger), ’015 CBM PO
`Resp. 35–37 (regarding Ovadia). Petitioner argues, in response, that Patent
`Owner’s interpretation of the limiting effect on the claim of reciting “during
`the checkout process” in the preamble is wrong for two reasons. First,
`Petitioner argues that reciting “during the checkout process” does not limit
`the scope of claims 15 or 28 at all. Reply 2–5. Second, Petitioner asserts
`that reciting “during the checkout process” does not limit when
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