`571-272-7822
`
` Paper No. 18
`Entered: July 23, 2018
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`
`
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`EBAY INC. and PAYPAL, INC.,
`Petitioner,
`
`v.
`
`XPRT VENTURES, LLC,
`Patent Owner.
`____________
`
`Case CBM2017-00025
`Patent 7,627,528 B2
`____________
`
`
`
`
`
`Before JAMESON LEE, KEVIN F. TURNER, and
`MICHAEL R. ZECHER, Administrative Patent Judges.
`
`TURNER, Administrative Patent Judge.
`
`
`
`FINAL WRITTEN DECISION
`Covered Business Method Patent Review
`35 U.S.C. § 328(a) and 37 C.F.R. § 42.73
`
`
`
`
`
`
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`CBM2017-00025
`Patent 7,627,528 B2
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`I.
`
`INTRODUCTION
`
`eBay Inc. and PayPal, Inc. (collectively, “Petitioner”), filed a Petition
`
`requesting a review under the transitional program for covered business
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`method patents of claims 13–15 (“challenged claims”) of U.S. Patent No.
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`7,627,528 B2 (Ex. 1001, “’528 Patent”). Paper 1 (“Pet.”). Patent Owner,
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`XPRT Ventures, LLC (“Patent Owner”), did not file a Preliminary
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`Response.
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`We preliminarily determined that the information presented in the
`
`Petition established that the ’528 Patent qualifies as a covered business
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`method patent that is eligible for review, and that it was more likely than not
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`that the challenged claims are unpatentable under 35 U.S.C. § 101. Paper 8.
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`Pursuant to 35 U.S.C. § 324 and § 18(a) of the Leahy-Smith America
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`Invents Act (“AIA”), Pub. L. No. 112-29, 125 Stat. 284, 329–31 (2011), we
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`instituted a covered business method patent review as to all of the
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`challenged claims. Id.
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`Patent Owner filed a corrected Response to the Petition (Paper 13
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`(“PO Resp.”)), and Petitioner filed a Reply (Paper 14 (“Pet. Reply”)).
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`Neither Petitioner nor Patent Owner requested oral argument, and no oral
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`argument was held. Papers 15, 16.
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`We have jurisdiction under 35 U.S.C. § 6(c). This decision is a Final
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`Written Decision under 35 U.S.C. § 328(a). For the reasons discussed
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`below, we hold that (1) the ’528 Patent qualifies as a covered business
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`method patent that is eligible for review, as defined by § 18(d)(1) of the
`
`AIA; and (2) Petitioner has demonstrated by a preponderance of the
`
`evidence that all of the challenged claims are unpatentable under 35 U.S.C.
`
`§ 101.
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`2
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`Patent 7,627,528 B2
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`A. Related Matters
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`
`
`The parties indicate that Patent Owner asserted the ’528 Patent against
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`Petitioner in a U.S. district court case captioned XPRT Ventures, LLC v.
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`eBay Inc., No. 1:10-cv-595-SLR (D. Del.) (“U.S. district court case”).
`
`Pet. 2–3; Paper 4, 2. Petitioner further indicates that, in the U.S. district
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`court case, Patent Owner also asserted five other patents against Petitioner,
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`specifically U.S. Patent Nos. 7,483,856 (“’856 patent”), 7,610,244
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`(“’244 patent”), 7,567,937 (“’937 patent”), 7,599,881 (“’881 patent”), and
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`7,512,563 (“’563 patent”). Pet. 2–3.
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`One Petitioner entity, eBay Inc., requested inter partes reexaminations
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`of the ’937 patent, ’563 patent, ’528 patent, ’856 patent, ’881 patent, and
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`’244 Patent, which were instituted in Reexamination Control Nos.
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`95/001,588, 95/001,589, 95/001,590, 95/001,594 (“’594 Reexamination”),
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`95/001,596, and 95/001,597, respectively. Pet. 3. With the exception of the
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`’594 Reexamination, decisions in each of those reexamination proceedings
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`are currently on appeal to the U.S. Court of Appeals for the Federal Circuit.
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`Pet. 3; Paper 4, 2.
`
`The parties further indicate that Petitioner has requested covered
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`business method patent reviews for the ’244 patent, ’563 patent, ’856 patent,
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`’881 patent, and ’937 patent, in Cases CBM2017-00024, CBM2017-00026,
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`CBM2017-00027, CBM2017-00028, and CBM2017-00029, respectively.
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`Paper 4, 2. Also, Patent Owner identifies U.S. Patent Application Nos.
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`12/547,201 and 12/603,063 as related matters. Paper 4, 2.
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`B. Standing
`
`Section 18 of the AIA governs the transitional program for covered
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`business method patent reviews. Under § 18(a)(1)(B) of the AIA, a person
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`Patent 7,627,528 B2
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`may not file a petition for such a review, unless that person, or the person’s
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`real-party-in-interest or privy, has been sued or charged with infringement of
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`a covered business method patent. Petitioner contends that Patent Owner
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`asserted the ’528 Patent against Petitioner in the U.S. district court case. Pet.
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`2–3, 10. Petitioner also argues that it is not estopped from challenging the
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`claims on the ground identified in the Petition. Id. at 10 (citing 37 C.F.R.
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`§ 42.302(b)). Patent Owner has not disputed either of those statements.
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`Accordingly, based on the record before us, we determine that Petitioner
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`satisfies the standing requirement.
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`C. Asserted Ground of Unpatentability
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`Petitioner asserts that the challenged claims are unpatentable under
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`35 U.S.C. § 101. Pet. 10–11, 20–45. Petitioner relies on the Declaration of
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`Clifford Neuman (Ex. 1005) in support of the Petition. Petitioner also cites
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`to Edward Preston Moxey, Jr., Practical Banking (1910) (Ex. 1006), and
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`Robert C. Zimmer & Theresa A. Einhorn, The Law of Electronic Funds
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`Transfer (1978) (Exs. 1007, 1008).
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`D. The ’528 Patent
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`The ’528 Patent generally relates to a computerized electronic auction
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`payment system and method for effecting a real-time payment for an item
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`won in an electronic auction. Ex. 1001, 1:17–23. The ’528 Patent describes
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`electronic auctions as typically involving a website, such as EBAYTM or
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`YAHOO!TM Auctions, where a prospective seller lists an item for sale and
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`specifies the date and time for the auction to end. Id. at 1:33–47.
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`Prospective bidders using a remote terminal access the electronic auction
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`website via an electronic network, such as the Internet, and may submit a bid
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`on the item for sale. Id. at 1:58–63. At the conclusion of the auction, the
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`4
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`bidder who has the highest bid is deemed the winning bidder, and to effect
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`payment for the item, an e-mail is sent to the seller and winning bidder
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`informing them to contact each other to proceed with a payment transaction.
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`Id. at 2:27–32.
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`The ’528 Patent describes several drawbacks of the known methods
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`for effecting payment. Ex. 1001, 2:63–3:34. According to the ’528 Patent,
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`one drawback is that a winning bidder is apt to wait prior to effecting
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`payment as the winning bidder must perform several tasks, including
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`drafting a check and mailing the check to the seller. Id. at 2:63–3:4. Also,
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`the seller must wait at least two business days to several weeks before being
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`paid. Id. at 3:5–6. Additionally, the ’528 Patent states that it is cumbersome
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`for the winning bidder to enter credit card information every time an item is
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`won, and the winning bidder may feel uneasy transferring credit card
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`information or may wait until the start of a new credit card billing cycle
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`before transferring the credit card information. Id. at 3:14–25. There is a
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`further delay until the operator of the electronic auction website gets paid a
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`commission by the seller, which usually involves the operator e-mailing the
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`seller and receiving the seller’s authorization. Id. at 3:26–34.
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`The ’528 Patent seeks to address these drawbacks by setting up and
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`maintaining electronic auction payment accounts––which the ’528 Patent
`
`describes as similar to bank accounts––for prospective bidders and sellers.
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`Id. at 3:64–4:1, 7:55–59. The prospective bidders provide funds to their
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`electronic auction payment accounts maintained by the electronic auction
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`payment system, before being deemed as winning bidders, by direct deposit,
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`using a credit card, or sending a check, money order, or other financial
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`document to an operator of the electronic auction payment system. Id. at
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`5
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`4:1–7. In one embodiment, the bidder can authorize the system to
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`automatically pay the seller upon winning the auction. Id. at 9:56–67. After
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`the winning bidder wins an auction item, the winning bidder can pay in real-
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`time (e.g., by clicking an icon on the electronic auction web site or by
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`clicking a hyperlink provided on an email transmitted by the electronic
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`auction system to the winning bidder and seller for accessing a payment
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`segment). Id. at 15:58–64.
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`Figure 1 of the ’528 Patent is reproduced below.
`
`
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`Figure 1 is an overview of a network computing environment that includes
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`the electronic auction payment system of the ’528 Patent. Id. at 6:14–16.
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`As shown in Figure 1, users 102 access an electronic auction website
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`via a network, such as Internet 106. Ex. 1001, 6:48–51. Web server
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`computers 107 and 108 are components within electronic auction system
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`6
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`Patent 7,627,528 B2
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`112 that operate to maintain the electronic auction website and allow each
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`user 102 to browse the electronic auction website and bid for or sell items.
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`Id. at 6:53–59. The web server computers 107 and 108 also allow each user
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`to access computerized electronic auction payment system 110 for effecting
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`a real-time payment at the conclusion of an electronic auction. Id. at 6:60–
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`67.
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`Computerized electronic auction payment system 110 includes a
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`database of electronic auction payment accounts 114 and web server
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`computer 116 having processor 118 capable of executing a set of
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`instructions stored within memory 119. Id. at 7:1–5. The instructions
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`enable computerized electronic auction payment system 110 to allow the
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`winning bidder to effect a real-time payment for an item won on the
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`electronic auction website. Id. at 7:12–17.
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`Computerized electronic auction payment system 110 also provides
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`the users a payment registration page, which is illustrated in Figure 4A of
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`the ’528 Patent, and is reproduced below. Id. at 8:35–37.
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`Patent 7,627,528 B2
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`Figure 4A illustrates payment registration page 400 that allows each user to
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`enter payment information. Id. at 8:42–43.
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`As shown in Figure 4A, the payment registration page includes
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`several fields 402 for entering a user’s bank account information to allow the
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`computerized electronic payment system to transfer funds into the user’s
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`electronic auction payment account. Ex. 1001, 8:42–48. Likewise, the
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`payment registration page includes several fields 404 for entering credit card
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`information to allow the user’s credit card to be charged so that funds are
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`deposited into the user’s electronic auction payment account, prior to the
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`user becoming a winning bidder. Id. at 8:42–56. Automatic payment field
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`416 is provided for the user to authorize computerized electronic auction
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`payment system 110 to debit the user’s electronic auction payment account
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`in real-time every time the user is deemed a winning bidder. Id. at 9:56–
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`10:3. If the user checks this field, then at the conclusion of an electronic
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`auction, if the user is deemed the winning bidder, the system debits the
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`user’s electronic auction payment account and credits the seller’s account in
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`real-time. Id. at 9:60–67.
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`E. Illustrative Claim
`
`Of the claims challenged in this proceeding, claim 13 is the only
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`independent claim. Independent claim 13 is directed to a method for
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`effecting at least one payment for a user of an electronic auction website.
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`Independent claim 13 is illustrative of the challenged claims and is
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`reproduced below:
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`13. A method for effecting at least one payment for a user
`of an electronic auction web site, said method comprising the
`steps of:
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`8
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`CBM2017-00025
`Patent 7,627,528 B2
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`providing the user with an option to enable loaning of
`funds if a payment source corresponding to the user has
`insufficient funds for effecting payment for at least one
`transaction conducted via the electronic auction web site;
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`receiving authorization from the user, in response to the
`option, to use the payment source corresponding to the user for
`effecting the at least one payment and to loan funds to the user if
`the payment source has insufficient funds;
`
`determining if the payment source corresponding to the
`user has sufficient funds for effecting the at least one payment;
`and
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`loaning funds for effecting the at least one payment if the
`payment source corresponding to the user has insufficient funds
`for effecting the at least one payment and authorization from the
`user has been received, wherein the payment system is in
`operative communication with the electronic auction system, and
`wherein the payment source corresponding to the user is a
`payment account maintained by the payment system and
`accessible by the user via at least one web page of the electronic
`auction web site.
`
`Ex. 1001, 20:13–37.
`
`F. Covered Business Method Patent
`
`Under § 18(a)(1)(E) of the AIA, we may institute a transitional review
`
`proceeding only for a covered business method patent. A “covered business
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`method patent” is “a patent that claims a method or corresponding apparatus
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`for performing data processing or other operations used in the practice,
`
`administration, or management of a financial product or service, except that
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`the term does not include patents for technological inventions.” AIA
`
`§ 18(d)(1); buySAFE, Inc. v. Google, Inc., 765 F.3d 1350, 1355 (Fed. Cir.
`
`2014); 37 C.F.R. § 42.301 (defining “[c]overed business method patent” and
`
`“[t]echnological invention”). Based on the record developed during trial, we
`
`conclude that the ’528 Patent both (1) claims methods for performing data
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`processing or other operations used in the practice, administration, or
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`management of a financial product or service, and (2) is not for a
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`technological invention.
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`1. Financial Product or Service
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`“[T]he definition of ‘covered business method patent’ is not limited to
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`products and services of only the financial industry, or to patents owned by
`
`or directly affecting activities of financial institutions.” Versata Dev. Grp.,
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`Inc. v. SAP Am., Inc., 793 F.3d 1306, 1325 (Fed. Cir. 2015). Pursuant to the
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`AIA, Ҥ 18(d)(1) directs us to examine the claims when deciding whether a
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`patent is a [covered business method] patent.” Blue Calypso, LLC v.
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`Groupon, Inc., 815 F.3d 1331, 1340 (Fed. Cir. 2016). The Federal Circuit
`
`has found claims that recite a limitation that is financial in nature to be
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`subject to covered business method patent review under § 18(d)(1).
`
`Unwired Planet, LLC v. Google Inc., 841 F.3d 1376, 1380 n.5 (Fed. Cir.
`
`2016) (citing Blue Calypso, 815 F.3d at 1340).
`
`Petitioner contends that the independent claim 13 recites a method for
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`“effecting at least one payment for a user of an electronic auction web site.”
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`Pet. 6. Petitioner also points to the method steps of “providing the user with
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`an option to enable loaning of funds,” “receiving authorization from the user
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`. . . to use the payment source corresponding to the user for effecting the at
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`least one payment and to loan funds to the user if the payment source has
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`insufficient funds,” “determining if the payment source . . . has sufficient
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`funds,” and “loaning funds for effecting the at least one payment if the
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`payment source corresponding to the user has insufficient funds.” Id.
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`Petitioner identifies all of these steps as activities that are financial in nature,
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`and “compels a finding that the ’528 patent is eligible for [covered business
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`Patent 7,627,528 B2
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`method patent] review.” Id. at 6–7. Also in support of this contention,
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`Petitioner refers to the classification of the ’528 Patent—namely class 705.
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`Id. at 5–6.
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`Patent Owner does not address any of the claim limitations identified
`
`by Petitioner or contend that they are not financial in nature. See generally
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`PO Resp. 5–9.
`
`We agree with Petitioner that independent claim 13 contains
`
`limitations for performing data processing or other operations that include a
`
`financial activity element. Specifically, these claims recite “providing the
`
`user with an option to enable loaning of funds;” “receiving authorization
`
`from the user;” “determining if the payment source corresponding to the user
`
`has sufficient funds;” and “loaning funds for effecting the at least one
`
`payment.” Ex. 1001, 20:13–37. Loaning of funds based on authorizations
`
`to effect payment is a financial activity. Accomplishing this task while in
`
`operative communication with the electronic auction system, and the
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`payment accounts thereof, falls within the scope of data processing or other
`
`operations. Accordingly, we determine that this claim satisfies the
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`“financial product or service” component of the definition for a covered
`
`business method patent set forth in § 18(d)(1) of the AIA.
`
`2. Technological Invention
`
`The definition of a “covered business method patent” in § 18(d)(1) of
`
`the AIA does not include patents for “technological inventions.” When
`
`determining whether a patent is for a technological invention, we consider
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`the following: “whether the claimed subject matter as a whole [(1)] recites a
`
`technological feature that is novel and unobvious over the prior art; and [(2)]
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`solves a technical problem using a technical solution.” 37 C.F.R.
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`§ 42.301(b).
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`For the technological invention exception to apply, both prongs (1)
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`and (2) of the inquiry must be met affirmatively, meaning that a negative
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`answer under either prong renders inapplicable the technological invention
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`exception. See, e.g., Apple, Inc. v. Ameranth, Inc., 842 F.3d 1229, 1240
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`(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
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`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.”); Blue Calypso, 815 F.3d at 1341 (addressing only
`
`whether the claimed invention solves a technical problem using a technical
`
`solution); Versata, 793 F.3d at 1326 (deciding to put aside the first prong of
`
`the regulation in stating that there would be little cause to determine whether
`
`a technological invention is novel and nonobvious at the stage of
`
`determining whether the patent at issue is a covered business method
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`patent). In this case, we discuss both prongs of the inquiry, even though the
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`discussion of only one is sufficient. For the reasons discussed below, neither
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`prong of the technological invention inquiry is met.
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`Petitioner argues that the challenged claims are not directed to a
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`technological invention, but instead are directed to business processes (i.e.,
`
`activities that are financial in nature) using only known technology. Pet. 7.
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`Petitioner asserts that the challenged claims merely recite the use of
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`conventional, nonspecialized processors, and that there is nothing novel or
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`unobvious about using a computer processor to complete a financial
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`transaction. Id. at 7–8. Petitioner further asserts that authorizing deductions
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`from an account, such as a bank account or a deposit account, and loaning
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`funds to effect payments, are not technical solutions. Id. at 9–10.
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`In response, Patent Owner contends that the challenged claims are
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`directed to novel and nonobvious improvements in computer-related
`
`technology (i.e., technological inventions) as demonstrated by the claims
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`having been found patentable over the prior art of record. PO Resp. 5–9.
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`Patent Owner further argues that the specification of the ’528 Patent sets
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`forth drawbacks of prior art payment systems, and that the challenged claims
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`provide technological solutions to those drawbacks. Id. at 8–9 (citing
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`Ex. 1001, 3:37–51).
`
`In reply, Petitioner contends that the only patent claims that are
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`eligible for review in covered business method patent review are claims of
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`issued patents and that, if an examiner’s decision to issue a claim was
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`dispositive of whether the claim is novel and nonobvious, then no claim in
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`an issued patent would ever be eligible for covered business method patent
`
`review. Pet. Reply 2. Petitioner further asserts that Patent Owner does not
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`provide any evidence or analysis that establishes how the challenged claims
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`address the drawbacks identified in the specification of the ’528 Patent in a
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`technological way. Id. at 2–3. Instead, Petitioner argues that it is well-
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`established that using generic computer technology to perform known
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`financial practices, without more, does not amount to a technological
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`invention. Id.
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`We agree with Petitioner that independent claim 13 does not recite a
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`novel and unobvious technological feature. See Pet. 7–10. Dr. Neuman’s
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`unrebutted testimony shows that independent claim 13 merely recites the use
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`of conventional, non-specialized databases and processors. Ex. 1005 ¶ 18.
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`13
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`The claimed solution––loaning funds to effect payments and using specific
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`accounts to accomplish the same––is more akin to maintaining and effecting
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`payments from a bank account, than a technical solution. Cf. Versata,
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`793 F.3d at 1327 (finding that a patent did not fall within the technological
`
`invention exception where the representative claim did “not [constitute] a
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`technical solution[,] but [was] more akin to creating organizational
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`management charts”). Indeed, the ’528 Patent itself analogizes its electronic
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`auction payment accounts as being similar to bank accounts. Ex. 1001,
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`7:55–62.
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`A claim does not represent a technological invention where it contains
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`“elements [that] are nothing more than general computer system components
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`used to carry out the claimed process” and there is no “technological aspect
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`in the claims that rises above the general and conventional.” Blue Calypso,
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`815 F.3d at 1341; see also SightSound Techs., LLC v. Apple Inc., 809 F.3d
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`1307, 1315 (Fed. Cir. 2015) (“Claiming a computer without ‘specific,
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`unconventional software, computer equipment, tools or processing
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`capabilities’ is insufficient.” (quoting Versata, 793 F.3d at 1327)). That is,
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`“conventional computer components cannot change the fundamental
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`character” of the claim. Blue Calypso, 815 F.3d at 1341; see also Versata,
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`793 F.3d at 1327 (“[E]ven if the invention required the use of a computer,
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`the claim did not constitute a technological invention.”).
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`Here, independent claim 13 only generically recites, for example, an
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`“electronic auction web site” and a “payment system.” There is no
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`indication from the record developed during trial that those components are
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`used in anything other than in a general and conventional way. Rather, the
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`’528 Patent only generically describes those components. See Ex. 1001,
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`14
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`7:1–5 (“The computerized electronic auction payment system 110 includes a
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`database of electronic auction payment accounts 114 and a web server
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`computer 116 having a processor 118 capable of executing a set of
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`programmable instructions stored within a memory 119.”). Furthermore, Dr.
`
`Neuman’s unrebutted testimony reinforces that the claims only recite the use
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`of conventional, non-specialized databases, processors, and hardware.
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`Ex. 1005 ¶ 20.
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`Patent Owner asserts that “the subject matter of the challenged claims
`
`provide technological solutions to the drawbacks set forth in the
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`specification and/or recite patentable technological features.” PO Resp. 8.
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`Patent Owner, however, provides no further evidence or explanation, nor
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`does Patent Owner identify with specificity the claimed technological
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`solutions or features that Patent Owner is referring to.
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`Instead, Patent Owner focuses its argument on the fact that the claims
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`were distinguished over “the prior art of record by addressing the
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`technological and patentable features recited by the claims” in prosecution
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`before the U.S. Patent and Trademark Office (“USPTO”). PO Resp. 7.
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`(“[B]y the [USPTO]’s withdrawal of the rejections of the pending claims
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`over the prior art of record during the prosecution of the patent by finding
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`Applicant’s arguments regarding the technical and technological differences
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`between the claimed subject matter and the prior art teachings persuasive, is
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`a strong indication the challenged claims were found by the [USPTO] to
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`solve technical problems which the prior art fails to do.”). Id. at 9. We,
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`however, agree with Petitioner that an examiner’s decision to issue a claim is
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`not dispositive of whether the claim is novel and nonobvious in determining
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`whether a patent is eligible for covered business method patent review. See
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`Pet. Reply 2; see also Versata, 793 F.3d at 1326–27 (recognizing that “the
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`invention under review, since it has already been covered by an issued
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`patent, was earlier determined by the USPTO to be novel and nonobvious,”
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`but, nevertheless, finding the patent at issue to be eligible for covered
`
`business method patent review). If Patent Owner’s position were correct,
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`then covered business method patent review authorized by Congress under
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`the AIA would be a nullity. As Petitioner points out, issued patent claims
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`are the only claims that are eligible for covered business method patent
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`review in the first place. Pet. Reply 2; see also e.g., AIA § 18(a)(2) (stating
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`that regulations establishing and implementing transitional program for
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`covered business method patents “shall apply to any covered business
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`method patent issued before, on, or after th[e] effective date” (emphasis
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`added)).
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`3. Summary
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`Independent claim 13 satisfies the definition for a covered business
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`method as set forth in § 18(d)(1) of the AIA, and it is not for a technological
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`invention. Accordingly, the ’528 Patent is eligible for review under the
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`transitional program for covered business method patents.
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`II. ANALYSIS
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`A. Claim Construction
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`In a covered business method patent review, we interpret claim terms
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`in an unexpired patent according to the broadest reasonable interpretation in
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`light of the specification of the patent in which it appears. 37 C.F.R.
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`§ 42.300(b). “[W]e need only construe terms ‘that are in controversy, and
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`only to the extent necessary to resolve the controversy.’” Nidec Motor
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`Corp. v. Zhongshan Broad Ocean Motor Co., 868 F.3d 1013, 1017 (Fed.
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`Cir. 2017) (quoting Vivid Techs., Inc. v. Am. Sci. & Eng’g, Inc., 200 F.3d
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`795, 803 (Fed. Cir. 1999)).
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`Petitioner proposes a construction for the claim term “web site.”
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`Pet. 20. We, however, need not address the construction of any claim term
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`to resolve the issues before us.
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`B. § 101 Ground
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`Petitioner contends that the challenged claims are directed to patent-
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`ineligible subject matter under § 101. Pet. 10–11, 20–45. Petitioner argues
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`that the challenged claims are directed to an abstract idea, and when
`
`considering the elements of each claim both individually and as an ordered
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`combination, there are no additional elements that transform the abstract
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`idea into a patent-eligible application. Id. at 27–44. Patent Owner disputes
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`this ground. See PO Resp. 5–7. Based on the record developed during trial,
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`Petitioner has demonstrated that all of the challenged claims are directed to
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`patent-ineligible subject matter under 35 U.S.C. § 101.
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`We begin our analysis with the principles of law that generally apply
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`to a ground based on 35 U.S.C. § 101, and then we turn to the arguments
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`presented by the parties.
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`1. Principles of Law
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`A patent may be obtained for “any new and useful process, machine,
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`manufacture, or composition of matter, or any new and useful improvement
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`thereof.” 35 U.S.C. § 101. The United States Supreme Court has held that
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`this statutory provision contains an important implicit exception: laws of
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`nature, natural phenomena, and abstract ideas are not patentable. E.g., Alice
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`Corp. Pty. Ltd. v. CLS Bank Int’l, 134 S. Ct. 2347, 2354 (2014).
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`Notwithstanding that a law of nature or an abstract idea, by itself, is not
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`patentable, the application of these concepts to a structure or process may be
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`deserving of patent protection. Mayo Collaborative Servs. v. Prometheus
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`Labs., Inc., 566 U.S. 66, 71 (2012).
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`In Alice, the Supreme Court reaffirmed the framework set forth
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`previously in Mayo “for distinguishing patents that claim laws of nature,
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`natural phenomena, and abstract ideas from those that claim patent-eligible
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`applications of those concepts.” Alice, 134 S. Ct. at 2355. In the analysis,
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`“we determine whether the claims at issue are directed to one of those
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`patent-ineligible concepts.” Id. If the claims are directed to a patent-
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`ineligible concept, the next step is to consider the elements of the claims
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`“individually and ‘as an ordered combination’” to determine whether there
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`are additional elements that “‘transform the nature of the claim’ into a
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`patent-eligible application.” Id. (quoting Mayo, 566 U.S. at 78–79).
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`2. Independent Claim 13
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`
`
`We first address independent claim 13, which recites “[a] method for
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`effecting at least one payment for a user of an electronic auction web site”
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`comprising the steps of “providing the user with an option to enable loaning
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`of funds if a payment source corresponding to the user has insufficient funds
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`for effecting payment for at least one transaction conducted via the
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`electronic auction web site;” “receiving authorization from the user, in
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`response to the option, to use the payment source corresponding to the user
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`. . . and to loan funds to the user if the payment source has insufficient
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`funds;” and “determining if the payment source . . . has sufficient funds;”
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`and “loaning funds . . . if the payment source . . . has insufficient funds . . .
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`and authorization from the user has been received.” Claim 13 also indicates
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`that “the payment system is in operative communication with the electronic
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`auction system, and wherein the payment source corresponding to the user is
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`a payment account maintained by the payment system and accessible by the
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`user via at least one web page of the electronic auction web site.” Ex. 1001,
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`20:13–37.
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`a. Statutory Category
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`“It remains true after [Alice] that ‘[a] § 101 analysis begins by
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`identifying whether an invention fits within one of the four statutorily
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`provided categories of patent-eligible subject matter.’” Aatrix Software, Inc.
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`v. Green Shades Software, Inc., 882 F.3d 1121, 1125 (Fed. Cir. 2018)
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`(second alteration in original) (quoting Ultramercial, Inc. v. Hulu, LLC,
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`772 F.3d 709, 713–14 (Fed. Cir. 2014)).
`
`
`
`Patent Owner first asserts that the challenged claims are directed to a
`
`statutory category because they are for payment systems and/or methods,
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`which are patentable as illustrated by several patents recently issued by the
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`USPTO. PO Resp. 5–6. Petitioner replies by contending that the fact that
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`some payment systems and methods are patent-eligible does not demonstrate
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`that the challenged claims in this case are patent-eligible. Pet. Reply 4.
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`Petitioner further argues that Patent Owner has provided no evidence that the
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`claims at issue bear any similarity to the claims of the other recently issued
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`patents identified by Patent Owner, except that those patents are related to
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`payment systems. Id.
`
`
`
`In determining whether independent claim 13 falls within a statutory
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`category, we do not need to consider whether the ’528 Patent is similar to
`
`the patents that Patent Owner cites, because independent claim 13 recites a
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`“method” (i.e., a process) with a series of steps for effecting payment for an
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`item. A process, by definition, falls within a statutory category under 35
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`U.S.C. § 101. Turning now to the Alice two-step framework, we first must
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`determine whether independent claim 13 falls under the abstract idea
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`exception. See Digitech Image Techs., LLC v. Elecs. for Imaging, Inc.,
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`758 F.3d 1344, 1350 (Fed. Cir. 2014) (“There is no dispute that the asserted
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`method claims describe a process. Claims that fall within one of