`______________________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`______________________
`
`
`
`PAYPAL, INC.
`
`Petitioner
`
`v.
`
`MONEYCAT LTD.
`
`Patent Owner
`
`________________________
`
`IPR2017-Unassigned
`U.S. Patent No. 8,712,918
`Issued: April 29, 2014
`Named Inventor: Kfir Luzzatto
`
`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
`
`
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`1.
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`2.
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`3.
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`4.
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`5.
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`6.
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`7.
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`8.
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`TABLE OF CONTENTS
`
`Page
`
`INTRODUCTION ........................................................................................... 1
`
`REQUIREMENTS FOR PETITION FOR INTER PARTES REVIEW .......... 3
`
`2.1. Grounds for Standing (37 C.F.R. § 42.104(a)) ..................................... 3
`
`2.2. Notice of Lead and Backup Counsel and Service Information ............. 3
`
`2.3. Notice of Real-Parties-in-Interest (37 C.F.R. § 42.8(b)(1)) .................. 4
`
`2.4. Notice of Related Matters (37 C.F.R. § 42.8(b)(2)) .............................. 5
`
`2.5. Fee for Inter Partes Review .................................................................. 5
`
`2.6. Proof of Service ..................................................................................... 5
`
`IDENTIFICATION OF CLAIMS BEING CHALLENGED AND
`RELIEF REQUESTED (§ 42.104(B)) ............................................................ 6
`
`PROSECUTION HISTORY OF THE 918 PATENT ..................................... 9
`
`OVERVIEW OF THE 918 PATENT ............................................................ 10
`
`CLAIM CONSTRUCTION .......................................................................... 10
`
`6.1. Applicable Law ................................................................................... 10
`
`6.2. Construction of Claim Terms .............................................................. 11
`
`6.2.1.
`
`“Currency Issuing Authority trusted server” ........................ 11
`
`PERSON OF ORDINARY SKILL IN THE ART (“POSA”) ....................... 11
`
`DESCRIPTION OF THE PRIOR ART ........................................................ 12
`
`8.1. Canadian Patent No. 2,221,399 to Teramura ...................................... 12
`
`8.2. Peirce & O’Mahony, “Scalable, Secure Cash Payment for
`WWW Resources with the PayMe Protocol Set” ............................... 13
`
`8.3. WIPO Pub. No. 97/19414 to Haynes .................................................. 14
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`8.4. U.S. Pat. No. 5,715,402 to Popolo ...................................................... 14
`
`9.
`
`GROUND #1: CLAIMS 1-3, 7-11, 15-17, AND 19-23 OF THE 918
`PATENT ARE UNPATENTABLE AS OBVIOUS OVER
`TERAMURA IN VIEW OF PEIRCE ........................................................... 15
`
`9.1.
`
`It Would Have Been Obvious To Adapt Teramura To Include
`Peirce’s CIAS ...................................................................................... 15
`
`9.2. Claim 1 is obvious over Teramura in view of Peirce .......................... 20
`
`9.2.1. 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: 20
`
`9.2.2.
`
`9.2.3.
`
`9.2.4.
`
`9.2.5.
`
`[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, 20
`
`[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); ....................................... 22
`
`[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; ........................................................... 23
`
`[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 ................................................................ 28
`
`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. ............................... 30
`
`9.3. Claim 2 is obvious over Teramura in view of Peirce .......................... 33
`
`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. ........................................... 33
`
`9.4. Claim 3 is obvious over Teramura in view of Peirce .......................... 34
`
`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. 34
`
`9.5. Claim 7 is obvious over Teramura in view of Peirce .......................... 35
`
`9.5.1. Claim 7: [7] The method according to claim 1, wherein
`the CIA provides the first data storage area. ........................ 35
`
`9.6. Claim 8 is obvious over Teramura in view of Peirce .......................... 37
`
`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. .................................... 37
`
`9.7. Claim 9 is obvious over Teramura in view of Peirce .......................... 39
`
`9.7.1. Claim 9: [9.P] A system for effecting currency
`transactions between users over
`a network,
`comprising: ........................................................................... 39
`
`9.7.2.
`
`9.7.3.
`
`[9.1] A) a Currency Issuing Authority trusted server
`(CIAS); .................................................................................. 40
`
`[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; 40
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`9.7.4.
`
`9.7.5.
`
`9.7.6.
`
`[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; 43
`
`[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; ........................................................................ 44
`
`[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 .................................................... 46
`
`9.7.7.
`
`[9.6] iii) create new electronic currency corresponding
`to a third monetary sum. ....................................................... 47
`
`9.8. Claim 10 is obvious over Teramura in view of Peirce ........................ 48
`
`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. ........................................................ 48
`
`9.9. Claim 11 is obvious over Teramura in view of Peirce ........................ 49
`
`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. ................................................................. 49
`
`9.10. Claim 15 is obvious over Teramura in view of Peirce ........................ 49
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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. ............................................................................ 49
`
`9.11. Claim 16 is obvious over Teramura in view of Peirce ........................ 51
`
`9.11.1. Claim 16: [16] The system according to claim 15
`wherein the second storage medium contains a second
`data storage area. ................................................................... 51
`
`9.12. Claim 17 is obvious over Teramura in view of Peirce ........................ 51
`
`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. .......................... 51
`
`9.13. Claim 19 is obvious over Teramura in view of Peirce ........................ 52
`
`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. ................. 52
`
`9.14. Claim 20 is obvious over Teramura in view of Peirce ........................ 53
`
`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. ............................................. 53
`
`9.15. Claim 21 is obvious over Teramura in view of Peirce ........................ 54
`
`9.15.1. Claim 21: [21] The system according to claim 10,
`wherein the first and second storage mediums are
`different storage mediums. ................................................... 54
`
`9.16. Claim 22 is obvious over Teramura in view of Peirce ........................ 55
`
`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. .......................... 55
`
`9.17. Claim 23 is obvious over Teramura in view of Peirce ........................ 55
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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. .......... 55
`
`10. GROUND #2: CLAIMS 4 AND 12 OF THE 918 PATENT ARE
`UNPATENTABLE AS OBVIOUS OVER TERAMURA IN VIEW
`OF PEIRCE AND HAYNES ........................................................................ 57
`
`10.1. It Would Have Been Obvious To Adapt Teramura In View Of
`Peirce To Include The Calculation of Balances Disclosed In
`Haynes ................................................................................................. 57
`
`10.2. Claim 4 is obvious over Teramura in view of Peirce and Haynes ...... 60
`
`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. ..................................................................... 60
`
`10.3. Claim 12 is obvious over Teramura in view of Peirce and
`Haynes ................................................................................................. 61
`
`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. ........................................... 61
`
`11. GROUND #3: CLAIMS 5, 6, 13, 14, AND 18 OF THE 918 PATENT
`ARE UNPATENTABLE AS OBVIOUS OVER TERAMURA IN
`VIEW OF PEIRCE AND POPOLO .............................................................. 62
`
`11.1. Popolo Is Analogous Prior Art ............................................................ 62
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`11.2. It Would Have Been Obvious To A POSA To Modify The
`Combination Of Teramura And Peirce To Include A
`Commission As Taught In Popolo ...................................................... 63
`
`11.3. Claim 5 Is Obvious Over Teramura In View Of Peirce And
`Popolo .................................................................................................. 65
`
`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. ........................................... 65
`
`11.4. Claim 6 Is Obvious Over Teramura In View Of Peirce And
`Popolo .................................................................................................. 66
`
`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. ..................................... 66
`
`11.5. Claim 13 Is Obvious Over Teramura In View Of Peirce And
`Popolo .................................................................................................. 68
`
`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. ....................................................................... 68
`
`11.6. Claim 14 Is Obvious Over Teramura In View Of Peirce And
`Popolo .................................................................................................. 69
`
`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. .................................................... 69
`
`vii
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`11.7. Claim 18 Is Obvious Over Teramura In View Of Peirce And
`Popolo .................................................................................................. 70
`
`11.7.1. Claim 18: [18] The method according to claim 2,
`wherein the second or third monetary sum includes a
`commission. .......................................................................... 70
`
`12. CONCLUSION .............................................................................................. 70
`
`
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`
`
`Exhibit #
`
`Exhibit List
`
`Description
`
`Ex.1001
`
`U.S. Patent No. 8,712,918
`
`Ex.1002
`
`File History for U.S. Patent No. 8,712,918 (excerpts)
`
`Ex.1003
`
`File History for U.S. Patent No. 7,590,602 (excerpts)
`
`Ex.1004
`
`Declaration of Dr. Clifford Neuman
`
`Ex.1005
`
`Canadian Patent No. 2,221,399 (“Teramura”)
`
`Ex.1006 WIPO Pub. No. WO 97/19414 (“Haynes”)
`
`Ex.1007
`
`U.S. Patent No. 5,715,402 (“Popolo”)
`
`Ex.1008
`
`U.S. Patent No. 5,768,385 (“Simon”)
`
`Ex.1009 U.S. Patent No. 8,195,578 (“578 Patent”)
`
`Ex.1010
`
`U.S. Patent No. 5,898,154
`
`Ex.1011
`
`U.S. Patent No. 5,420,405
`
`Ex.1012
`
`U.S. Patent No. 5,870,473
`
`Ex.1013
`
`Ex.1014
`
`Ex.1015
`
`Ex.1016
`
`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”)
`
`Shapiro, Eben. “THE MEDIA BUSINESS; New Features Are
`Planned By Prodigy,” The New York Times, September 6, 1990
`“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/
`pubdocs/fv-austin.txt
`Neuman, B. Clifford. “Usenix Tutorial on Electronic Commerce:
`Getting Paid on the Internet,” July 1995
`
`ix
`
`
`
`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`Exhibit #
`Description
`Ex.1017 Medvinsky, Gennady. “NetCash: A Framework for Electronic
`Currency,” May 1997
`
`Ex.1018
`
`Rivest, Ronald and Shamir, Adi. “PayWord and MicroMint: Two
`simple micropayment schemes,” May 7, 1996
`
`Ex.1019
`
`Everybody’s Internet Update, No. 9 – February 1995
`
`Ex.1020
`
`U.S. Patent No. 6,321,213
`
`Ex.1021
`
`U.S. Patent No. 5,870,456
`
`Ex.1022
`
`Fourth International World Wide Web Conference
`(https://www.w3.org/Conferences/WWW4/)
`
`Ex.1023
`
`IWC32 – Past and Future Conferences
`(http://www.iw3c2.org/conferences/)
`Ex.1024 WWW4 Program Wednesday, 13 Dec 1995
`(https://www.w3.org/Conferences/WWW4/Wednesday.html)
`
`Ex.1025
`
`Declaration of Walter Walker
`
`Ex.1026
`
`Certified Canadian File History of Canadian Patent No. 2,221,399
`
`
`
`x
`
`
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`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 of claims 1-23 of United States
`
`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.1009,
`
`“578 Patent”), claims 1-3, 5-11, and 13-23 of which the Board found unpatentable
`
`in CBM2014-00093. The challenged claims of the 918 Patent do no more than
`
`restate substantially the same limitations as those of the 578 Patent. Ex.1004, ¶13.
`
`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, 22:61. 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. See
`
`also Ex.1001, 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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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`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,
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`2
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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].” ‘602 Patent File History, November 14, 2005 Response at p. 18,
`
`Ex.1003. 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 inter partes review and
`
`that Petitioner is not barred or estopped from requesting inter partes review 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
`
`provides the following designation of Lead and Back-Up counsel.
`
`
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`3
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`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.
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`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. 3:14-cv-02490-JST (MEJ) (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.
`
`The Board’s final written decisions in CBM2014-00091, -00092, and -00093 are
`
`currently being appealed by Moneycat to the Federal Circuit as Case Nos. 2016-
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`1399, 2016-1405, and 2016-1408. Oral argument is scheduled for January 13,
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`2017.
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`The 918 Patent claims priority to Israeli Patent Applications 131612,
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`131672, and 132919 through the 578 and 602 Patents. The 918 Patent is also
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`related to the 011 Patent in that both claim priority to the 602 Patent.
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`2.5. Fee for Inter Partes Review
`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-MSG (D. Del.) prior to transfer.
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`5
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`
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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 inter partes review of claims 1-23 of the 918
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`Patent, and 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 Canadian Patent No. 2,221,399 (“Teramura”; Ex.1005) in view of
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`Michael 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,
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`pp.587-601 (“Peirce,” Ex.1013).
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`Teramura was published on May 21, 1998 and is prior art to the 918 Patent
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`under § 102(a), (b). The published application was classified and indexed
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`according to the International Patent Classification (IPC) and International
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`Identification (INID) codes by the Canadian Patent Office. Ex.1026, pp.3, 89. The
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`Board previously determined that Teramura is prior art to the Related Moneycat
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`Patents, which claim the same priority date as the 918 Patent. See eBay Inc. v.
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`Moneycat Ltd., CBM2014-00091, Paper 50 at 18-25; eBay Inc. v. Moneycat Ltd.,
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`CBM2014-00092, Paper 49 at 18-25; eBay Inc. v. Moneycat Ltd., CBM2014-
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`00093, Paper 51 at 18-25. Moneycat did not challenge this determination on
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`appeal.
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`6
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`
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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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.1022,
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`p.2; Ex.1023, p.1. The web site for the Fourth International WWW Conference
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`further corroborates that Peirce was presented during general sessions on
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`December 13, 1995. Ex.1024, 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.1025, 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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`7
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`
`
`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
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`description of NetCash at pp. 590-591, 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 Teramura 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 to the 918 Patent 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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`Teramura 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 to the 918 Patent 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.1004, “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 PTAB
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`to adopt each ground of unpatentability presented at least for the following reasons.
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`8
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`
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
`
`The PTAB 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 an attempt 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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`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 here in the accompanying Declaration of Clifford Neuman
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`(Ex.1004).
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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, U.S. App. No. 13/464,451 (the
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`“451 Application”), claims priority to U.S. App. Nos. 12/539,141 and 09/644,104,
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`which 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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`9
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`
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`Petition for Inter Partes Review of U.S. Pat. No. 8,712,918
`
`The Examiner issued a non-final rejection on May 16, 2013, rejecting all
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`pending claims. Ex.1002, p.2. 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. at pp.16-33.
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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. at pp.34, 43.
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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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`P