UNITED STATES PATENT AND TRADEMARK OFFICE
`______________________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`______________________
`
`
`
`PAYPAL, INC.
`Petitioner
`
`v.
`
`MONEYCAT LTD.
`Patent Owner
`
`________________________
`
`IPR2017-Unassigned
`U.S. Patent No. 8,712,918
`
`Title: ELECTRONIC CURRENCY, ELECTRONIC WALLET THEREFOR AND
`ELECTRONIC PAYMENT SYSTEMS EMPLOYING THEM
`
`________________________
`
`Petition for Inter Partes Review of U.S. Patent No. 8,712,918 Under 35 U.S.C
`§§ 311-319 and 37 C.F.R. §§ 42.1-.80, 42.100-.123
`
`
`
`
`
`Mail Stop “PATENT BOARD”
`Patent Trial and Appeal Board
`U.S. Patent and Trademark Office
`P.O. Box 1450
`Alexandria, VA 22313-1450
`
`
`
`

`
`1. 
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`2. 
`
`3. 
`
`4. 
`
`5. 
`
`6. 
`
`7. 
`
`8. 
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
`
`Table of Contents
`
`Page
`
`INTRODUCTION ........................................................................................... 3 
`
`REQUIREMENTS FOR PETITION FOR INTER PARTES REVIEW .......... 5 
`
`2.1.  Grounds for Standing (37 C.F.R. § 42.104(a)) ..................................... 5 
`
`2.2.  Notice of Lead and Backup Counsel and Service Information ............. 5 
`
`2.3.  Notice of Real-Parties-in-Interest (37 C.F.R. § 42.8(b)(1)) .................. 6 
`
`2.4.  Notice of Related Matters (37 C.F.R. § 42.8(b)(2)) .............................. 7 
`
`2.5.  Fee for IPR ............................................................................................ 7 
`
`2.6.  Proof of Service ..................................................................................... 7 
`
`IDENTIFICATION OF CLAIMS BEING CHALLENGED AND
`RELIEF REQUESTED (§ 42.104(B)) ............................................................ 8 
`
`PROSECUTION HISTORY OF THE 918 PATENT ................................... 11 
`
`OVERVIEW OF THE 918 PATENT ............................................................ 11 
`
`CLAIM CONSTRUCTION .......................................................................... 12 
`
`6.1.  Applicable Law ................................................................................... 12 
`
`6.2.  Construction of Claim Terms .............................................................. 12 
`
`“Currency Issuing Authority trusted server” .................. 12 
`6.2.1. 
`PERSON OF ORDINARY SKILL IN THE ART (“POSA”) ....................... 12 
`
`DESCRIPTION OF THE PRIOR ART ........................................................ 13 
`
`8.1.  U.S. Pat. No. 5,915,023 to Bernstein .................................................. 13 
`
`8.2.  Peirce & O’Mahony, “Scalable, Secure Cash Payment for
`WWW Resources with the PayMe Protocol Set” ............................... 16 
`
`8.3.  WIPO Pub. No. 97/19414 to Haynes .................................................. 17 
`
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`8.4.  U.S. Pat. No. 5,715,402 to Popolo ...................................................... 18 
`
`9. 
`
`GROUND #1: CLAIMS 1-3, 7-11, 15-17, AND 19-23 OF THE 918
`PATENT ARE UNPATENTABLE AS OBVIOUS OVER
`BERNSTEIN IN VIEW OF PEIRCE ............................................................ 18 
`
`9.1. 
`
`It Would Have Been Obvious To Adapt Bernstein To Include
`Peirce’s CIAS ...................................................................................... 19 
`
`9.2.  Claim 1 is obvious over Bernstein in view of Peirce .......................... 24 
`
`9.2.1. 
`
`9.2.2. 
`
`9.2.3. 
`
`9.2.4. 
`
`9.2.5. 
`
`Claim 1: [1.P] A method for effecting currency
`transactions between a first user and a second user
`over a network, the method comprising the
`following steps: ............................................................... 24 
`[1.1] A) a Currency Issuing Authority trusted
`server (CIAS) receives payment instructions from
`said first user to transfer a first monetary sum to
`said second user, ............................................................. 25 
`[1.2] wherein the CIAS is programmed to receive
`payment instructions from said first user only over
`a network connection between said first user and a
`Currency Issuing Authority (CIA); ................................ 28 
`[1.3] B) the CIAS accesses electronic currency in a
`first active electronic currency area located in a
`first data storage area, said electronic currency
`having been provided by said CIA; ................................ 30 
`[1.4] C) the CIAS manipulates the electronic
`currency located in said first active electronic
`currency area to withdraw a second monetary sum
`therefrom by (i) deleting electronic currency that
`equals the second monetary sum and/or (ii)
`generating a record containing information on the
`amount withdrawn that equals the second
`monetary sum and/or (iii) generating a record
`containing information on the amount of electronic
`currency remaining in said first active electronic
`currency area after withdrawing the second
`monetary sum; and .......................................................... 33 
`
`ii
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`9.2.6. 
`
`[1.5] D) the CIAS creates new electronic currency
`corresponding to a third monetary sum. ......................... 35 
`9.3.  Claim 2 is obvious over Bernstein in view of Peirce .......................... 38 
`
`9.3.1. 
`
`Claim 2: [2] The method according to claim 1,
`further comprising the step of: E) the CIAS
`transmits the new electronic currency to a second
`data storage area associated with the second user. ......... 38 
`9.4.  Claim 3 is obvious over Bernstein in view of Peirce .......................... 39 
`
`9.4.1. 
`
`Claim 3: [3] The method according to claim 1,
`wherein the new electronic currency is used to
`create a record of the third monetary sum to be
`paid to the second user. ................................................... 39 
`9.5.  Claim 7 is obvious over Bernstein in view of Peirce .......................... 41 
`
`9.5.1. 
`
`Claim 7: [7] The method according to claim 1,
`wherein the CIA provides the first data storage
`area. ................................................................................. 41 
`9.6.  Claim 8 is obvious over Bernstein in view of Peirce .......................... 42 
`
`9.6.1. 
`
`Claim 8: [8] The method according to claim 2,
`wherein the CIAS transmits the new electronic
`currency to the second data storage area, wherein
`the second data storage area is provided by the
`CIA.................................................................................. 42 
`9.7.  Claim 9 is obvious over Bernstein in view of Peirce .......................... 44 
`
`9.7.1. 
`
`9.7.2. 
`
`9.7.3. 
`
`Claim 9: [9.P] A system for effecting currency
`transactions between users over a network,
`comprising: ..................................................................... 44 
`[9.1] A) a Currency Issuing Authority trusted
`server (CIAS); ................................................................. 45 
`[9.2] B) a first active electronic currency area
`associated with a first user provided in a first
`storage medium, said first active electronic
`currency area having electronic currency and being
`accessible to the CIAS; ................................................... 45 
`
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`9.7.4. 
`
`[9.3] C) a communication line programmed to
`receive from the first user, only over a network
`connection between said first user and the CIA,
`payment instructions to issue a first monetary sum
`to a second user;.............................................................. 48 
`[9.4] D) data transfer and manipulation apparatus
`programmed to: i) access said first user's one or
`more electronic currency in said first active
`electronic currency area; ................................................. 48 
`[9.5] ii) withdraw a second monetary sum from
`said first active electronic currency area by (a)
`deleting said first user's electronic currency in the
`first active electronic currency area that equals the
`second monetary sum and/or (b) generating a
`record containing information on the amount
`withdrawn that equals the second monetary sum as
`spent and/or (c) generating a record containing
`information on the amount of electronic currency
`remaining in said first active electronic currency
`area after withdrawing the second monetary sum;
`and ................................................................................... 50 
`[9.6] iii) create new electronic currency
`corresponding to a third monetary sum. ......................... 51 
`9.8.  Claim 10 is obvious over Bernstein in view of Peirce ........................ 51 
`
`9.7.5. 
`
`9.7.6. 
`
`9.7.7. 
`
`9.8.1. 
`
`Claim 10: [10] The system according to claim 9,
`further comprising a second active electronic
`currency area associated with the second user
`provided in a second storage medium. ........................... 51 
`9.9.  Claim 11 is obvious over Bernstein in view of Peirce ........................ 52 
`
`9.9.1. 
`
`Claim 11: [11] The system according to claim 9,
`wherein the data transfer and manipulation
`apparatus is programmed to utilize the new
`electronic currency to create a record of the third
`monetary sum to be paid to the second user. .................. 52 
`9.10.  Claim 15 is obvious over Bernstein in view of Peirce ........................ 53 
`
`iv
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`9.10.1. 
`
`Claim 15: [15] The system according to claim 9,
`further comprising a second storage medium
`provided by the CIA. ...................................................... 53 
`9.11.  Claim 16 is obvious over Bernstein in view of Peirce ........................ 54 
`
`9.11.1. 
`
`Claim 16: [16] The system according to claim 15
`wherein the second storage medium contains a
`second data storage area. ................................................ 54 
`9.12.  Claim 17 is obvious over Bernstein in view of Peirce ........................ 55 
`
`9.12.1. 
`
`Claim 17: [17] The method according to claim 1,
`wherein the first monetary sum, the second
`monetary sum and the third monetary sum are
`equal. ............................................................................... 55 
`9.13.  Claim 19 is obvious over Bernstein in view of Peirce ........................ 56 
`
`9.13.1. 
`
`Claim 19: [19] The method according to claim 2,
`wherein the CIAS transmits the new electronic
`currency to the second data storage area, wherein
`the second data storage area is provided by the
`CIA.................................................................................. 56 
`9.14.  Claim 20 is obvious over Bernstein in view of Peirce ........................ 56 
`
`9.14.1. 
`
`Claim 20: [20] The system according to claim 10,
`wherein the first and second storage mediums are
`the same type of storage mediums. ................................. 56 
`9.15.  Claim 21 is obvious over Bernstein in view of Peirce ........................ 58 
`
`9.15.1. 
`
`Claim 21: [21] The system according to claim 10,
`wherein the first and second storage mediums are
`different storage mediums. ............................................. 58 
`9.16.  Claim 22 is obvious over Bernstein in view of Peirce ........................ 59 
`
`9.16.1. 
`
`Claim 22: [22] The system according to claim 10,
`wherein the first monetary sum, the second
`monetary sum and the third monetary sum are
`equal. ............................................................................... 59 
`9.17.  Claim 23 is obvious over Bernstein in view of Peirce ........................ 60 
`
`v
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`9.17.1. 
`
`Claim 23: [23] The method according to claim 1,
`wherein (a) the second monetary sum withdrawn
`from the first active electronic currency is the first
`monetary sum and a commission, and the third
`monetary sum is equal to the first monetary sum;
`(b) the first monetary sum and the second
`monetary sum are equal, and the third monetary
`sum is the first monetary sum minus a
`commission, or (c) the first monetary sum, the
`second monetary sum and the third monetary sum
`are equal. ......................................................................... 60 
`10.  GROUND #2: CLAIMS 4 AND 12 OF THE 918 PATENT ARE
`UNPATENTABLE AS OBVIOUS OVER BERNSTEIN IN VIEW
`OF PEIRCE AND HAYNES ........................................................................ 61 
`
`10.1.  It Would Have Been Obvious To Adapt Bernstein In View Of
`Peirce To Include The Calculation of Balances Disclosed In
`Haynes
`61 
`
`10.2.  Claim 4 is obvious over Bernstein in view of Peirce and Haynes ...... 63 
`
`10.2.1. 
`
`Claim 4: [4] The method according to claim 1,
`wherein the new electronic currency is used to
`calculate the balance in a second data storage area
`associated with the second user. ..................................... 63 
`10.3.  Claim 12 is obvious over Bernstein in view of Peirce and
`Haynes
`64 
`
`10.3.1. 
`
`Claim 12: [12] The system according to claim 9,
`wherein the data transfer and manipulation
`apparatus is programmed to utilize the new
`electronic currency to calculate the balance in a
`second data storage area associated with the
`second user. ..................................................................... 64 
`11.  GROUND #3: CLAIMS 5, 6, 13, 14, AND 18 OF THE 918 PATENT
`ARE UNPATENTABLE AS OBVIOUS OVER BERNSTEIN IN
`VIEW OF PEIRCE AND POPOLO .............................................................. 65 
`
`11.1.  Popolo Is Analogous Prior Art ............................................................ 65 
`
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`11.2.  It Would Have Been Obvious To A POSA To Modify The
`Combination Of Bernstein And Peirce To Include A
`Commission As Taught In Popolo ...................................................... 67 
`
`11.3.  Claim 5 Is Obvious Over Bernstein In View Of Peirce And
`Popolo
`68 
`
`11.3.1. 
`
`Claim 5: [5] The method according to claim 1,
`wherein the second monetary sum withdrawn from
`the first active electronic currency area is the first
`monetary sum and a commission; and the third
`monetary sum is equal to the first monetary sum. .......... 68 
`11.4.  Claim 6 Is Obvious Over Bernstein In View Of Peirce And
`Popolo
`70 
`
`11.4.1. 
`
`Claim 6: [6] The method according to claim 1,
`wherein the first monetary sum and the second
`monetary sum are equal; and the third monetary
`sum is the first monetary sum minus a
`commission. .................................................................... 70 
`11.5.  Claim 13 Is Obvious Over Bernstein In View Of Peirce And
`Popolo
`71 
`
`11.5.1. 
`
`Claim 13: [13] The system according to claim 9,
`wherein the data transfer and manipulation
`apparatus is programmed to include a commission
`with the first monetary sum to calculate the second
`monetary sum withdrawn from the first active
`electronic currency area so the third monetary sum
`is equal to the first monetary sum. .................................. 71 
`11.6.  Claim 14 Is Obvious Over Bernstein In View Of Peirce And
`Popolo
`72 
`
`11.6.1. 
`
`Claim 14: [14] The system according to claim 9,
`wherein the data transfer and manipulation
`apparatus is programmed to deduct a commission
`from the second monetary sum, which is equal to
`the first monetary sum, to calculate the third
`monetary sum to be paid to the second user. .................. 72 
`
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`11.7.  Claim 18 Is Obvious Over Bernstein In View Of Peirce And
`Popolo
`73 
`
`11.7.1. 
`
`Claim 18: [18] The method according to claim 2,
`wherein the second or third monetary sum includes
`a commission. ................................................................. 73 
`12.  CONCLUSION .............................................................................................. 73 
`
`viii
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`

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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
`
`Exhibit #
`
`Exhibit List
`
`Description
`
`Ex.1001 U.S. Patent No. 8,712,918
`
`Ex.1002 U.S. Patent No. 8,195,578
`
`Ex.1003
`
`File History for U.S. Patent No. 7,590,602 (excerpts)
`
`Ex.1004 U.S. Patent No. 5,915,023 (“Bernstein”)
`
`Ex.1005
`
`Michael Peirce and Donal O’Mahony, “Scalable, Secure Cash
`Payment for WWW Resources With the PayMe Protocol Set,”
`World Wide Web Journal, Nov. 1995, at 587-601 (“Peirce”)
`
`Ex.1006 WIPO Pub. No. WO 97/19414 (“Haynes”)
`
`Ex.1007 U.S. Patent No. 5,715,402 (“Popolo”)
`
`Ex.1008 Declaration of Dr. Clifford Neuman
`
`Ex.1009
`
`File History for U.S. Patent No. 8,712,918 (excerpts)
`
`Ex.1010 U.S. Patent No. 5,768,385 (“Simon”)
`
`Ex.1011 U.S. Patent No. 5,870,456
`
`Ex.1012 U.S. Patent No. 5,898,154
`
`Ex.1013 U.S. Patent No. 5,420,405
`
`Ex.1014 U.S. Patent No. 5,870,473
`
`Ex.1015
`
`Shapiro, Eben. “THE MEDIA BUSINESS; New Features Are
`Planned By Prodigy,” The New York Times, September 6, 1990.
`
`Ex.1016
`
`“Perils and Pitfalls of Practical Internet Commerce: The Lessons of
`First Virtual’s First Year,” available at
`http://web.archive.org/web/19961104175714/http://www.fv.com/pu
`bdocs/fv-austin.txt.
`Ex.1017 Neuman, B. Clifford. “Usenix Tutorial on Electronic Commerce:
`
`i
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`

`
`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
`
`Exhibit #
`
`Description
`Getting Paid on the Internet,” July 1995.
`Ex.1018 Medvinsky, Gennady. “NetCash: A Framework for Electronic
`Currency,” May 1997, at p. 23.
`
`Ex.1019
`
`Rivest, Ronald and Shamir, Adi. “PayWord and MicroMint: Two
`simple micropayment schemes,” May 7, 1996
`
`Ex.1020
`
`Everybody’s Internet Update, No. 9 – February 1995
`
`Ex.1021
`
`Fourth International World Wide Web Conference
`(https://www.w3.org/Conferences/WWW4/)
`
`Ex.1022
`
`IWC32 – Past and Future Conferences
`(http://www.iw3c2.org/conferences/)
`Ex.1023 WWW4 Program Wednesday, 13 Dec 1995
`(https://www.w3.org/Conferences/WWW4/Wednesday.html)
`
`Ex.1024 Declaration of Walter Walker
`
`ii
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`

`
`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
`
`1.
`
`INTRODUCTION
`
`PayPal, Inc. (“Petitioner”), in accordance with 35 U.S.C. §§ 311-319 and 37
`
`C.F.R. § 42.100, requests inter partes review (“IPR”) of claims 1-23 of U.S. Patent
`
`No. 8,712,918 (Ex.1001, “the 918 Patent”). According to USPTO records, the 918
`
`Patent is assigned to Moneycat Ltd. (“Moneycat” or “Patent Owner”).
`
`The 918 Patent is a continuation of U.S. Patent No. 8,195,578 (Ex.1002, “the
`
`578 Patent”), claims 1-3, 5-11, and 13-23 of which the Board found unpatentable
`
`in CBM2014-00093. The claims of the 918 Patent merely restate substantially the
`
`same limitations as those of the 578 Patent.
`
`The 918 Patent seeks to address a purported problem in the prior art, namely,
`
`that electronic payment systems were overly complicated and left users with the
`
`feeling that they had no real control over the movement of their money. Ex.1001,
`
`1:33-44. To address these purported shortcomings in the prior art, the 918 Patent
`
`introduces a “Currency Issuing Authority trusted server” (CIAS), which acts as a
`
`middleman between the buyer and the seller. Ex.1001, 15:66-16:40. Instead of the
`
`buyer and the seller directly interacting, the buyer instructs the middleman to
`
`transfer electronic funds on the buyer’s behalf to the seller. Ex.1001, 16:13-18;
`
`Fig. 7.
`
`Using a middleman, however, was not a novel concept when the 918 Patent
`
`was filed, but was instead a well-known, time-honored means for increasing
`
`
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`

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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
`
`transaction confidence. Entire industries have grown up around this concept,
`
`including escrow services, brokers, dealers, liaisons, mediators, etc. Indeed,
`
`anyone that has bought a house has used a middleman. The buyer places the
`
`purchase amount with an escrow service, which indicates to the seller that the
`
`buyer actually has the funds for the purchase. The seller clears title and transfers
`
`title to the buyer. Funds are then released from the escrow service to the seller.
`
`For many years, financial institutions have offered a myriad of middleman
`
`services, including credit cards, checks, wire transfers, and brokerage services.
`
`None of these services transfers funds directly from the buyer to the seller; the
`
`funds are transferred from an intermediary, the bank, to the seller. Take brokerage
`
`services, for example. The buyer instructs a brokerage service to purchase a certain
`
`amount of stock. The brokerage, on behalf of the buyer, purchases stock from the
`
`seller and, also on behalf of the buyer, transfers a sum of money to the seller.
`
`The 918 Patent takes this well-worn concept, and extends it to electronic
`
`currency transfers. But electronic currency, like the middleman concept, was not
`
`new when the 918 Patent was filed. Indeed, the 918 Patent dedicates several
`
`columns to discussing different electronic currencies in the prior art, including
`
`Millicent, Digicash, and NetCash. Ex.1001, 2:1-4:42. NetCash, for instance,
`
`issued electronic coins that buyers purchased and then used with merchants that
`
`accepted NetCash. Each “coin” had a unique identifier, information about its value,
`
`4
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`and authentication information. The buyer transferred the coins to the seller and the
`
`seller subsequently redeemed the coins for US dollars or new NetCash coins. See
`
`Ex.1001, Fig. 2.
`
`Simply stated, the 918 Patent takes a very well-known concept, the
`
`middleman, and adapts its use to another well-known concept, electronic currency.
`
`Indeed, the Applicant himself stated during prosecution of a related parent patent
`
`that there are only “two fundamental aspects of the present invention” – “isolation
`
`of the principal parties [using a middleman], and the use of data packets [electronic
`
`currency].” Ex.1003, p.18. There is nothing novel or patentable about using a
`
`middleman to transfer electronic currency.
`
`2.
`
`REQUIREMENTS FOR PETITION FOR INTER PARTES REVIEW
`2.1. Grounds for Standing (37 C.F.R. § 42.104(a))
`Petitioner certifies that the 918 Patent is available for IPR and that Petitioner
`
`is not barred or estopped from requesting IPR of the challenged claims of the 918
`
`Patent on the grounds identified herein.
`
`2.2. Notice of Lead and Backup Counsel and Service Information
`Pursuant to 37 C.F.R. §§ 42.8(b)(3), 42.8(b)(4), and 42.10(a), Petitioner
`
`designates the following Lead and Back-Up counsel.
`
`5
`
`
`
`

`
`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
`
`Lead Counsel
`Adrian Percer
`Registration No. 46,986
`(adrian.percer@weil.com)
`
`Postal & Hand-Delivery Address:
`Weil Gotshal & Manges LLP
`201 Redwood Shores Parkway
`Redwood Shores, CA 94065
`T: 650-802-3124; F: 650-802-3100
`
`Back-Up Counsel
`Naveen Modi
`Registration No. 46,224
`(naveenmodi@paulhastings.com)
`
`Postal & Hand-Delivery Address:
`Paul Hastings LLP
`875 15th Street, N.W.
`Washington, D.C. 20005
`T: 202-551-1990; F: 202-551-0490
`
`Jared Bobrow
`Pro hac vice to be submitted
`(jared.bobrow@weil.com)
`Postal & Hand-Delivery Address:
`Weil Gotshal & Manges LLP
`201 Redwood Shores Parkway
`Redwood Shores, CA 94065
`T: 650-802-3034; F: 650-802-3100
`
`Brian Chang
`Registration No. 74,301
`(brian.chang@weil.com)
`Postal & Hand-Delivery Address:
`Weil Gotshal & Manges LLP
`201 Redwood Shores Parkway
`Redwood Shores, CA 94065
`T: 650-802-3936; F: 650-802-3100
`
`
`Pursuant to 37 C.F.R. § 42.10(b), a Power of Attorney for the Petitioner is
`
`attached.
`
`2.3. Notice of Real-Parties-in-Interest (37 C.F.R. § 42.8(b)(1))
`Petitioner PayPal, Inc., which is a subsidiary of PayPal Holdings, Inc., is the
`
`real party in interest.
`
`6
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
`
`2.4. Notice of Related Matters (37 C.F.R. § 42.8(b)(2))
`Moneycat has asserted the Related Moneycat Patents against Petitioner in
`
`MoneyCat, Ltd. v. PayPal, Inc., Case No. 14-cv-02490-JST (N.D. Cal.).1 The
`
`Related Moneycat Patents were the subject of covered business method review in
`
`CBM2014-00091, CBM2014-00092, CBM2014-00093, and CBM2015-00008.
`
`Moneycat is currently appealing the Board’s final written decisions in CBM2014-
`
`00091, -00092, and -00093 to the Federal Circuit as Case Nos. 2016-1399, 2016-
`
`1405, and 2016-1408. Oral argument is scheduled for January 13, 2017.
`
`The 918 Patent claims priority to Israeli Patent Applications 131612,
`
`131672, and 132919 through the 578 and 602 Patents. The 918 Patent is also
`
`related to the 011 Patent in that both claim priority to the 602 Patent.
`
`2.5. Fee for IPR
`The Director is authorized to charge the fee specified by 37 C.F.R.
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`§ 42.15(a), and any other required fees, to Deposit Account No. 506499.
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`2.6. Proof of Service
`Proof of service of this petition on Patent Owner at the correspondence
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`address of record for the 918 Patent is attached.
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`1 Originally filed as Case No. 1:13-cv-01358-RGA (D. Del.) prior to transfer.
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`3.
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`IDENTIFICATION OF CLAIMS BEING CHALLENGED AND
`RELIEF REQUESTED (§ 42.104(B))
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`Petitioner respectfully requests IPR of claims 1-23 of the 918 Patent, and
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`cancellation of these claims as unpatentable.
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`Ground #1: Claims 1-3, 7-11, 15-17, and 19-23 of the 918 Patent are
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`unpatentable under (pre-AIA) 35 U.S.C. § 103 on the ground that they are rendered
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`obvious by U.S. Patent No. 5,915,023 (“Bernstein”; Ex.1004) in view of Michael
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`Peirce and Donal O’Mahony, “Scalable, Secure Cash Payment for WWW
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`Resources With the PayMe Protocol Set,” World Wide Web Journal, Nov. 1995, at
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`587-601 (“Peirce,” Ex.1005).
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`Bernstein was filed on January 6, 1997 and issued on June 22, 1999 and is
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`prior art under § 102(a).
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`Peirce is a prior art printed publication under § 102(a), (b). Peirce states on
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`its face that it was first printed in November 1995 and presented at the Fourth
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`International World Wide Web Conference on December 11-14, 1995. Ex.1005,
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`pp.1-2. The 918 Patent likewise admits that Peirce was “presented at the Fourth
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`International World Wide Web Conference, Dec. 11-14, 1995, Boston, Mass.,
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`USA.” Ex.1001, 3:44-49. The World Wide Web Conference has been held
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`annually since 1993 and is open to persons of ordinary skill in the art, including
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`“researchers, developers, and users working with the World Wide Web.” Ex.1021,
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`p.2; Ex.1022, p.1. The web site for the Fourth International WWW Conference
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`further corroborates that Peirce was presented during general sessions on
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`December 13, 1995. Ex.1023, p.4. Additionally, as set forth in the Declaration of
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`Walter Walker, Peirce was cataloged at the William H. Hannon Library at Loyola
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`Marymount University no later than February 23, 1998 and made available to
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`visitors of the library within 7 days of that date. Ex.1024, pp.1-2. Peirce purports
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`to be Issue One of a periodical, the World Wide Web Journal, and therefore is self-
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`authenticating under Fed. R. Evid. 902(6). Ex.1005, pp.1-2. Accordingly, Peirce
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`is a prior art printed publication to the 918 Patent under § 102(a), (b). Figure 2 of
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`the 918 Patent is substantively identical to Figure 2 of Peirce, and the 918 Patent
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`admits that what is shown in Figure 2 is prior art. Ex.1001, Fig.2. Similarly, the
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`written description of the 918 Patent at 2:56-3:42 substantially duplicates Peirce’s
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`description of NetCash at pp. 12-13, and admits that NetCash was prior art.
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`Ex.1001, 2:49-56.
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`Ground #2: Claims 4 and 12 of the 918 Patent are unpatentable under (pre-
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`AIA) 35 U.S.C. § 103 on the ground that they are rendered obvious by Bernstein in
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`view of Peirce, and further in view of WIPO Pub. No. 97/19414 (“Haynes”;
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`Ex.1006). Haynes was filed November 21, 1996 and published May 29, 1997, and
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`is prior art under § 102(a), (b).
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`Ground #3: Claims 5, 6, 13, 14, and 18 of the 918 Patent are unpatentable
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`under (pre-AIA) 35 U.S.C. § 103 on the ground that they are rendered obvious by
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`Bernstein in view of Peirce, and further in view of U.S. Patent No. 5,715,402
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`(“Popolo”; Ex.1007). Popolo was filed on November 9, 1995 and issued on
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`February 3, 1998, and is prior art under § 102(a), (b).
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`Each ground is explained below and is supported by the Declaration of Dr.
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`Clifford Neuman. (Ex.1008, “Neuman Decl.”).
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`Statement of Non-Redundancy: The grounds raised in this petition and
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`IPR2017-Unassigned, also challenging the 918 Patent and concurrently filed by
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`Petitioner, are meaningfully distinct from one another and rely upon fundamentally
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`different combinations of the cited prior art references. Petitioner urges the Board
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`to adopt each ground of unpatentability presented at least for the following reasons.
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`The Board instituted CBM Reviews of the Related Moneycat Patents in
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`cases CBM2014-00091, 00092, and 00093 on both Bernstein and Teramura. In
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`those CBMs, the Patent Owner raised different arguments in attempting to
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`distinguish Bernstein and Teramura, which strongly supports that the grounds in
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`this petition are not redundant to IPR2017-Unassigned.
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`Petitioner recognizes that Teramura, Bernstein, and Peirce were previously
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`disclosed to the Examiner during the initial prosecution of the 918 Patent. The
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`grounds raised in the petition are not redundant with those addressed during the
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`initial examination, however, because the grounds raised by the Petitioner combine
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`the prior art references in ways that were not applied by the Examiner during
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`prosecution. Additionally, the Examiner did not have the benefit of the final
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`decisions in CBM2014-00091, 00092, and 00093 or the supporting declaration of
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`one of the key individuals responsible for the development of NetCash, as
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`Petitioner has submitted in the Neuman Declaration (Ex.1008).
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`4.
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`PROSECUTION HISTORY OF THE 918 PATENT
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`The application that issued as the 918 Patent, App. No. 13/464,451 (the “451
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`Application”), claims priority to App. Nos. 12/539,141 and 09/644,104, which
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`issued as the 578 and 602 Patents, respectively. The 451 Application further
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`claims priority to Israeli Patent Applications 131612, 131672, and 132919.
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`The Examiner issued a non-final rejection on May 16, 2013, rejecting all
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`pending claims. Ex.1009, p.3. The Applicant, however, argued that the prior art
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`taught away from the claims because the prior art allegedly teaches that the
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`customer sends payment instructions directly to the merchant, rather than sending
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`the payment instructions through a CIAS or isolation server. Id., pp.16-25.
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`The Examiner issued the Notice of Allowance on March 3, 2014, and the
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`451 Application issued as the 918 Patent on April 9, 2014. Id., 27, 36.
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`5. OVERVIEW OF THE 918 PATENT
`The 918 Patent discusses several prior art references and professes to
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`address a purported flaw in those references –that the buyer and the seller must
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`directly interact with each other during transaction. Ex.1001, 4:16-19. The 918
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`Patent’s apparent solution to this problem is to use a middleman, known as a
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`currency sever, to mediate the transaction. Rather than have the buyer directly pay
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`the merchant, the buyer pays the middleman, which in turn pays the merchant.
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`Ex.1008, ¶¶10-12.
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`6.
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`CLAIM CONSTRUCTION
`6.1. Applicable Law
`A claim in a non-expired patent is interpreted according to the “broadest
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`reasonable construction in light of the specification of the patent in which it
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`appears.” 37 C.F.R. § 42.100(b).
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`6.2. Construction of Claim Terms
`Petitioner respectfully submits that the following terms should be construed:
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`6.2.1. “Currency Issuing Authority trusted server”
`The Board previously construed “Currency Issuing Authority trusted server”
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`in the Related Moneycat Patents to mean “a server that is trusted by the Currency
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`Issuing Authority (‘CIA’).” CBM2014-00091, Paper 50 at 9; CBM2014-00092,
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`Paper 49 at 9; CBM2014-00093, Paper 51 at 9. Petitioner submits that the term
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`“Currency Issuing Authority trusted server” should be given the same construction
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`in this proceeding.
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`7.
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`PERSON OF ORDINARY SKILL IN THE ART (“POSA”)
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`A POSA would have been familiar with various conventional systems for
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`electronic payments and electronic currency transactions, including two-step
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`transaction systems that employ intermediary “broker servers” that can be trusted,
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`and would have understood the security problem