`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`DISH NETWORK CORPORATION
`and DISH NETWORK LLC,
`Petitioner,
`
`v.
`
`CUSTOMEDIA TECHNOLOGIES, LLC,
`Patent Owner.
`____________
`
`Cases
`CBM2017-00019 (Patent 7,840,437 B2)
`CBM2017-00023, IPR2017-00454 (Patent 8,719,090 B2)
`CBM2017-00032, IPR2017-00717, IPR2017-00724
`(Patent 9,053,494 B2)
`____________
`
`Record of Oral Hearing
`Held: March 5, 2018
`____________
`
`
`
`
`Before MEREDITH C. PETRAVICK, MICHAEL W. KIM, and KALYAN
`K. DESHPANDE, Administrative Patent Judges.
`
`
`
`
`
`
`CBM2017-00019 (Patent 7,840,437 B2)
`CBM2017-00023, IPR2017-00454 (Patent 8,719,090 B2)
`CBM2017-00032, IPR2017-00717, IPR2017-00724 (Patent 9,053,494 B2)
`
`
`
`APPEARANCES:
`
`ON BEHALF OF THE PETITIONER:
`
`
`ELIOT D. WILLIAM, ESQUIRE
`G. HOPKINS GUY, ESQUIRE
`Baker Botts, LLP
`1001 Page Mill Road, Suite 200
`Palo Alto, California 94303-1007
`
`
`ON BEHALF OF THE PATENT OWNER:
`
`
`DANIEL SCARDINO, ESQUIRE
`Reed & Scardino, LLP
`301 Congress Avenue, Suite 1250
`Austin, Texas 78701
`
`and
`
`STEVEN TEPERA, ESQUIRE
`Pillsbury Winthrop Shaw Pittman, LLP
`401 Congress Avenue, Suite 1700
`Austin, Texas 78701-3443
`
`
`
`
`The above-entitled matter came on for hearing on Monday, March 5,
`
`2018, commencing at 9:30 a.m., at the U.S. Patent and Trademark Office,
`600 Dulany Street, Alexandria, Virginia.
`
`2
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`
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`CBM2017-00019 (Patent 7,840,437 B2)
`CBM2017-00023, IPR2017-00454 (Patent 8,719,090 B2)
`CBM2017-00032, IPR2017-00717, IPR2017-00724 (Patent 9,053,494 B2)
`
`
`P R O C E E D I N G S
`- - - - -
`JUDGE PETRAVICK: Good morning. We are here for hearing in
`CBM2017-00019, CBM2017-00023, IPR2017-00454, CBM2017-00032,
`IPR2017-00717 and IPR2017-00724. This is Dish Network Corporation
`versus Customedia Technologies, LLC. I'm Judge Petravick. With me on
`the bench is Judge Deshpande and Judge Kim. So could we please know
`who is here from the petitioner.
`MR. WILLIAMS: Good morning, Your Honor. Elliot Williams
`of Baker Botts for the petitioner.
`MR. GUY: Hopkins Guy, Your Honor, with Baker Botts for the
`petitioner.
`JUDGE PETRAVICK: And for the patent owner?
`MR. TEPERA: Your Honor, my name is Steven Tepera for the
`patent owner from Pillsbury.
`MR. SCARDINO: And Daniel Scardino for the patent owner.
`JUDGE PETRAVICK: Thank you. Before you leave today, if
`you could give the business card to the court reporter so that she has the
`correct spelling of your name, that would be appreciated.
`So first a couple of matters, can everybody hear me okay?
`MR. GUY: I'm having a hard time.
`JUDGE PETRAVICK: Usually I have to speak directly into this
`microphone. How is that?
`MR. GUY: That's better.
`JUDGE PETRAVICK: All right. First things, each side has a total
`of two hours. And I understand from the filing that we are going to be
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`CBM2017-00019 (Patent 7,840,437 B2)
`CBM2017-00023, IPR2017-00454 (Patent 8,719,090 B2)
`CBM2017-00032, IPR2017-00717, IPR2017-00724 (Patent 9,053,494 B2)
`
`splitting it up by issue. So what I anticipate us doing today is going roughly
`two hours, having our lunch break and then we'll come back and do the other
`two hours. Unfortunately, this clock does not count all the way up to two
`hours. So I have an alternate clock here on the bench which, unfortunately,
`you won't be able to see. But what I will do is keep track of your total time
`as you go along. If you need a reminder of how much time you have left,
`just please request it and I will let you know.
`Also, some objections were filed to the patent owner's
`demonstrative exhibits. We are going to hold back on ruling on those
`objections, but we are just going to remind all parties that there are no new
`evidence and no new arguments allowed during oral argument and therefore,
`anything after we go through the record is determined to be a new argument
`or new evidence will not be considered when making our final written
`determination.
`So that being said, if there are objections during the hearing, what
`we are going to do is I like to have the objections in place in the transcript
`where they occur. However, if we get so many objections that it's very
`interruptive to the arguments, at that point in time, we will then have you
`hold your objections to the end of the presentation. Does everybody
`understand that?
`So I believe we are first going to hear arguments as to CBM
`eligibility. And the order will go petitioner, patent owner, petitioner. So
`you may approach the podium and begin when you are ready.
`MR. WILLIAMS: Thank you, Your Honors. May it please the
`Board, I would like to begin with CBM eligibility of the '090 and the '494
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`CBM2017-00019 (Patent 7,840,437 B2)
`CBM2017-00023, IPR2017-00454 (Patent 8,719,090 B2)
`CBM2017-00032, IPR2017-00717, IPR2017-00724 (Patent 9,053,494 B2)
`
`patents which are the ones relating predominantly to advertising. I'll just
`begin with slide 4 showing what the standard for CBM eligibility is from the
`statute. Of course, the rule follows this language fairly closely. The key
`piece, obviously, is determining whether the claims are directed to
`something that's used in the operation, practice, administration or
`management of a financial product or service with, of course, the exception
`for technological invention.
`Turning to slide 10, we'll just look at some of the claims first from
`the '090 patent starting with claim 1. I think the most notable thing about
`these claims is they are all generally directed to some type of targeted
`advertisements or targeted advertising. Now, advertising is a prototypical
`business activity. Its purpose, of course, is to alert the public to the
`availability of your products and to gain sale. If advertising isn't involved in
`the scope of covered business method or review, it's hard to know what
`would, frankly.
`JUDGE KIM: Counsel, don't we already have some case law from
`the Federal Circuit that has said that -- that cast doubt on advertising as a
`financial product or service?
`MR. WILLIAMS: I don't think it would cast doubt. I believe
`Calypso, for instance, has never been overruled and was pretty much directly
`on that point. The Federal Circuit analyzed the business method eligibility
`of those claims because they involved advertising and concluded they were
`squarely within the program. So I don't think that you can say any doubt has
`been cast on that category.
`JUDGE KIM: I'm thinking more about Unwired Planet.
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`CBM2017-00019 (Patent 7,840,437 B2)
`CBM2017-00023, IPR2017-00454 (Patent 8,719,090 B2)
`CBM2017-00032, IPR2017-00717, IPR2017-00724 (Patent 9,053,494 B2)
`
`
`MR. WILLIAMS: So I think what's clear about Unwired Planet is
`the simple notion that the fact that something is ancillary to a business
`activity is not enough. So the Federal Circuit has sort of rejected that that
`notion which came from the trial practice guide and was not a promulgated
`rule, and so they said it wasn't in accordance with law. But certainly they
`didn't say it couldn't fit within the scope of the program if the Board were of
`course to promulgate a rule to that effect. But I don't think it called into
`question the notion here of, for instance, Blue Calypso that that was an
`advertising claim.
`JUDGE KIM: Wasn't that a subsidy claim?
`MR. WILLIAMS: Well, it involved subsidies in order to
`encourage people to watch advertisements, as I recall.
`JUDGE KIM: But Unwired Planet was more toward location data
`or providing advertisements, was it not, and that they show -- they held that
`that was ancillary -- not ancillary -- well, it was incidental, ancillary,
`complementary, meaning it was not directed to advertising.
`MR. WILLIAMS: Yeah, I think you could perhaps read the
`Federal Circuit to have held that. It's hard to know if they held that or just
`simply rejected the board's reasoning that ancillary was enough and because
`nothing further was provided, didn't go any further in their analysis. We
`could have a debate about that, but I don't think it changes the fact -- I'm
`going to go into the dependent claims in a second because these certainly get
`clearer to, I think, the questions you are asking, Judge Kim. But I think even
`putting that aside, looking at claim 7, for instance, it talks about placing an
`advertising order. That claim as not been disclaimed. It's still in the case.
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`CBM2017-00019 (Patent 7,840,437 B2)
`CBM2017-00023, IPR2017-00454 (Patent 8,719,090 B2)
`CBM2017-00032, IPR2017-00717, IPR2017-00724 (Patent 9,053,494 B2)
`
`An order, I mean, what else is a financial transaction if not an order? So I
`think the '090 patent itself on its face clearly still falls within the scope even
`if you were to assume that advertising isn't enough. Although, by no means
`do I think that that is actually the state of the law as we stand here today.
`In addition, I would point out, obviously, the rest of the dependent
`claims shown here on slide 10 are clearly directed to financial services.
`They call out specifically financial transactions, charging for a product and
`purchasing something. Those are all clearly within the scope of CBM
`eligibility.
`I'll come back to the disclaimer issue in a second, but let me just
`show slide 12 which relates to the '494 patent. So again here we start with
`claim 1, again, directed generally to advertising. So I think we've discussed
`that already. And then the dependent claims involve purchasing and rates or
`advertising, which are, of course, prices and cost effectiveness.
`So the other thing I'll note about claim 1 is that claim 5, obviously,
`depended from claim 1 and it recited originally some -- before it was
`disclaimed recited the notion of -- basically clarified or added context to
`what this predefined criteria were in claim 1. It might be easier to just look
`at the whole text of claim 1 which I have here on slide 49.
`So that last element relating to the software tells you about these
`predefined criteria that are used essentially to select advertisements.
`Claim 5 made clear that some of that criteria could be monitoring product
`rental and purchase history of a user. So again, what that tells us is that this
`notion of suitable data that's discussed in claim 1 must include this concept
`that was in claim 5, notwithstanding the fact that claim 5 was disclaimed.
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`CBM2017-00019 (Patent 7,840,437 B2)
`CBM2017-00023, IPR2017-00454 (Patent 8,719,090 B2)
`CBM2017-00032, IPR2017-00717, IPR2017-00724 (Patent 9,053,494 B2)
`
`So this is a pure claim construction argument. What does this claim cover?
`We know that this predefined suitable criteria has to be at least inclusive of
`monitoring product rentals or purchases because that's how the claims were
`written originally.
`So now just returning to this notion of claim disclaimer, the
`Board's precedential opinion in the Facebook case, the precedential portion
`of that opinion, I should say, makes clear that the CBM eligibility is assessed
`at the time of the institution decision. Not subsequent to that. So in this
`case, the fact that the claims were disclaimed after institution is simply
`irrelevant to determining CBM eligibility, and the Board is well within its
`rights to look at those claims, look at those dependent claims in determining
`whether the claims are directed to the covered business method activity.
`And we would point out that the Federal Circuit even more
`recently in the Arthrex case which we have here on the slide has interpreted
`the IPR provisions to permit the Board jurisdiction to enter an adverse
`judgment even before an institution decision. So once a petition is filed, the
`Federal Circuit at least has interpreted the statute to give the Board
`jurisdiction over the case. So I think there is really no doubt given the
`precedential Facebook opinion that seems to be good law after Arthrex
`certainly hasn't done anything to change the fact that certainly by the time of
`institution the Board's jurisdiction is established.
`JUDGE DESHPANDE: The Facebook decision was directed to a
`decision to institute and determine claims at that moment. What would
`preclude us from extending the same holding as it would apply to a final
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`CBM2017-00019 (Patent 7,840,437 B2)
`CBM2017-00023, IPR2017-00454 (Patent 8,719,090 B2)
`CBM2017-00032, IPR2017-00717, IPR2017-00724 (Patent 9,053,494 B2)
`
`written decision holding the claim's eligibility should be determined at the
`final written decision moment after claims have been instituted on?
`MR. WILLIAMS: Well, I mean, it would certainly be a pretty
`radical departure from what the language of the statue is, which is you assess
`CBM eligibility based on -- I mean, the whole point of this Facebook
`analysis was determined what does the statue say about the temporal aspect
`of CBM eligibility, and the precedential portion of that opinion seems to
`conclude that what the statute is referring to is at the time of institution.
`That's the key bit, what is the patent directed to at that time. Not what
`happened subsequent to that. The JP Morgan case which we cited did a
`similar analysis and I think reached the same conclusion. So I don't know of
`any board precedent that would suggest that somehow the jurisdiction of the
`board can at any point disappear after institution up until the final written
`decision. And indeed, I think that would be completely consistent with what
`the Federal Circuit did in Arthrex. Not only does it not disappear, but you
`actually have jurisdiction as soon as the petition is filed.
`JUDGE DESHPANDE: Do we have any case law to support the
`notion that a disclaimed claim post institution is insufficient to remove CBM
`eligibility?
`MR. WILLIAMS: Well, certainly in the JP Morgan case, I'm
`trying to remember procedurally, I think what they did is actually hold in
`abeyance the attempt to disclaim the claims. But I could be wrong about
`that. I would have to go back and recheck the procedural posture of that
`case. But certainly what the Board concluded in that case is they weren't
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`CBM2017-00019 (Patent 7,840,437 B2)
`CBM2017-00023, IPR2017-00454 (Patent 8,719,090 B2)
`CBM2017-00032, IPR2017-00717, IPR2017-00724 (Patent 9,053,494 B2)
`
`going to treat the disclaimer or the attempted disclaimer as stripping the
`Board of jurisdiction or CBM eligibility post institution.
`So unless there's any questions about that, I would like to move to
`step 2 of this analysis which has to do with the -- and whether this is a
`technological invention. And the rule is broken down into two pieces which
`is, is there a technological feature and does the patent solve a technical
`problem using a technical solution?
`So with respect to the first prong and whether there's a
`technological feature, I think certainly with respect to the '090 and '494
`patents, we'll have a lot of discussion about the prior art later today. So I
`won't prolong this discussion too long. But suffice to say we believe pretty
`strongly that there's certainly no technological feature that's new or
`unobvious over the prior art in these advertisement claims. And the trial
`practice guide is giving sort of guidance on interpreting this provision,
`which is shown on slide 18, which is that the recitation of known
`technologies typically would not be enough to render a patent a
`technological invention. And that's what we believe is going on here.
`JUDGE KIM: Counsel, patent owner faults petitioner for not
`disclosing where the petition sets forth that the technologies are known. Do
`you have a response to that? For example, what evidence is relied upon?
`MR. WILLIAMS: So I mean, the '090 petition, of course, had a
`prior art analysis for claims 1, 5 and 7. So I'll start with that. I think
`certainly that was sufficient. And with respect to the '494 patent, we did
`apply the Hite reference within the CBM petition showing at least in terms
`of our 101 analysis where we thought all these elements were shown. So I
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`CBM2017-00019 (Patent 7,840,437 B2)
`CBM2017-00023, IPR2017-00454 (Patent 8,719,090 B2)
`CBM2017-00032, IPR2017-00717, IPR2017-00724 (Patent 9,053,494 B2)
`
`think that's sufficient -- I mean, it's obviously a slightly different test. We
`are doing a 101 analysis involving the prior art largely in both petitioner, but
`the essence of that analysis is the same, what is new here in these claims
`that's relevant to both sets of questions, whether there's 101 eligibility and
`whether it's a technological invention.
`JUDGE KIM: Can you point to where in the petition you stated
`your intent is to have the prior art analysis applied to this prong of the
`technological invention?
`MR. WILLIAMS: So in the '494 petition, this is the 0032 case.
`It's on page 8. This is analyzing the technological invention prong. We say
`it's explained below in section 7, the claims of the patent were previously
`disclosed by Hite, referring to section 7.
`So I think with respect to the '090 patent, and this is CBM2017-23,
`I would say certainly the focus of our section there was more on the second
`part of the test than the first part, so was the solution technical. But I think
`certainly that's true. But at page 7 we say as explained below in section 7,
`the claims are anticipated and obvious over the prior art and therefore, do
`not recite a technology feature. So again, referring to our analysis in the 101
`section. And I'm going to come back to the '437 in a minute.
`JUDGE KIM: That's fine. Thank you.
`MR. WILLIAMS: So just looking at slide 19, these two patents
`generally relate to targeted advertisements and have this concept of reserved
`storage in them. That concept, even the examiner agreed during
`prosecution, was known at the time.
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`CBM2017-00019 (Patent 7,840,437 B2)
`CBM2017-00023, IPR2017-00454 (Patent 8,719,090 B2)
`CBM2017-00032, IPR2017-00717, IPR2017-00724 (Patent 9,053,494 B2)
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`
`Turning to the other prong of this technological invention test, is
`there a tech solution here? Again, we think repeatedly that there is not. This
`is simply a business solution. Advertising is a business problem. What the
`patents are getting at is solving this business problem of providing targeted
`ads. And in solving that problem, all they are reciting is functionality that
`are known in the prior art, structures and functionality from the prior art.
`We know from cases like the Federal Circuit's Apple v. Ameranth case that
`that's not enough to satisfy the technological invention prong of this test.
`And because either of those -- both of those prongs have to be present in
`order for there to be a technological invention. If the patent fails one of
`those two prongs, then it is not a technological invention.
`And then lastly, I'll just point out on slide 20 we'll talk a little bit
`more about this as the day progresses, but all of these elements of the claims,
`the structural elements that are recited in the claims of the '090 and '494 are
`by admission of the patent itself known structures.
`So I'm going to turn now to the '437 patent unless there's other
`questions about the targeted advertisement patent eligibility. Hearing none,
`so slide 14 has three of the claims, excerpts of the three of the claims from
`the '437 patent. This patent relates to rental of content. This is digital video
`rental. This is essentially what's being claimed here. So claim 1 talks about
`a return of rented data. Now, rental is inherently itself a financial transaction
`that, in fact, on slide 11 you'll see we asked patent owner's expert about
`these kind of words "renting," "leasing," "purchasing," are those financial?
`And the expert essentially conceded at least they could be. He certainly
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`CBM2017-00019 (Patent 7,840,437 B2)
`CBM2017-00023, IPR2017-00454 (Patent 8,719,090 B2)
`CBM2017-00032, IPR2017-00717, IPR2017-00724 (Patent 9,053,494 B2)
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`didn't reject the notion that rental is some type of a transaction going on
`there.
`
`So claim 1 by itself, I think, is well within the scope of the CBMR
`program. Seventeen and 27, of course, add additional features such as
`charging someone's credit card and making purchases explicitly. So those
`terms are also explicitly in the dependent claims.
`JUDGE KIM: Counsel, patent owner says claim 1 only says
`rented. Not rental or renting or selling or what have you. What is your
`response to that?
`MR. WILLIAMS: Well, to have data that's been rented, there
`must have been a rental transaction is my response. That's just English. I
`think it's a pretty simple plain and ordinary meaning of what rented must
`mean. So I don't find that argument to be a meaningful distinction.
`JUDGE KIM: Ist that enough, though, just to say that it's rented?
`Is that not incidental complementary, ancillary?
`MR. WILLIAMS: Well, it is for sure, but it's also well within the
`scope of the statute. It is a financial transaction. Rental is a transaction.
`That's what that means.
`JUDGE KIM: What I'm getting at is the incidental,
`complementary, ancillary test hast been rejected.
`MR. WILLIAMS: Well, I mean, we know from cases like Secure
`Axcess that, and certainly Judge Plager's subsequent interpretation of his
`opinion in Secure Axcess, that you don't just look at the pure claim language
`itself. You have to read it in the context of the other claims of the
`specification and then decide whether the claims are CBM eligible. So we'll
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`CBM2017-00019 (Patent 7,840,437 B2)
`CBM2017-00023, IPR2017-00454 (Patent 8,719,090 B2)
`CBM2017-00032, IPR2017-00717, IPR2017-00724 (Patent 9,053,494 B2)
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`talk more about the specification, obviously, as we go today and it will be
`quite clear that the whole point of this system is to enable transactions to
`occur. And that's explicitly recited when we said that you are doing a
`simulated return of rented data. It's very clear that means there has been a
`transaction.
`And in fact, during a simulated return, the point of doing the
`simulated return is described in the file history at least, although the patent
`owner has somewhat backed away from that view today, is that you want to
`be able to have this opportunity to prompt the user to pay more or to tell
`them you returned late, you have a late fee due. The whole point of this is to
`generate more revenue for the supplier of the data, whoever it is. Otherwise,
`you could just do an automatic return where at the end of rental period, the
`file is no longer usable and the claim -- that aspect was in the prior art, as the
`examiner found during prosecution. And that's why there was this focus
`during prosecution on the notifying element to say, no, we need this
`additional step of notifying so that there's these opportunities for transactions
`to occur.
`So I think you have to read the claims all in the context of what's
`happening in the file history of the spec to give context of what rented data
`here is, which is there must have been a rental transaction and there's going
`to be another transaction potentially. The claims certainly are broad enough
`to cover that.
`JUDGE KIM: I'm going to push back to you a bit in that Secure
`Axcess was pretty clear that the fact that 500 banks were sued, the fact that
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`CBM2017-00019 (Patent 7,840,437 B2)
`CBM2017-00023, IPR2017-00454 (Patent 8,719,090 B2)
`CBM2017-00032, IPR2017-00717, IPR2017-00724 (Patent 9,053,494 B2)
`
`banks and other financial institutions or especially in the spec, we cannot
`take that into account in determining CBM eligibility.
`MR. WILLIAMS: Yeah, and I'm not asking you to take into
`account the fact that they have sued a bank here. They didn't. They sued
`Dish. I mean, we are not saying we are a financial institution. So this is
`definitely not a Secure Axcess problem. We are not saying, yes, it turns out
`that the patent is for a lightbulb, but they just shoot banks, therefore it must
`be a financial activity. No. This is a claim directed to rented data and
`directed to a return of rented data for the purpose of getting additional
`revenue out of the user at the time this occurs.
`In addition, we talked about the dependent claims already, and as I
`said previously, the Board is well within its rights to consider the scope of
`the dependent claims in determining CBM eligibility.
`Let me move on, then, to -- I'll just point out, getting back to this
`discussion, slide 15 has some of the sections from the specification that
`relate to what the point of this patent is, which was to create a transaction or
`commercial zone to purchase or rent data products. And then the whole
`notion of this was to assess late charges or fees if the user didn't return them
`in time. I think all of that has to be taken into account in assessing whether
`the claim is directed to whether this is a CBM patent.
`JUDGE KIM: Are you sure about that? Because again, Secure
`Axcess seems to suggest not. So I just want to make that clear.
`MR. WILLIAMS: Well, I'm sorry, which part are you thinking
`Secure Axcess --
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`CBM2017-00019 (Patent 7,840,437 B2)
`CBM2017-00023, IPR2017-00454 (Patent 8,719,090 B2)
`CBM2017-00032, IPR2017-00717, IPR2017-00724 (Patent 9,053,494 B2)
`
`
`JUDGE KIM: That says you can take the specification into
`account.
`MR. WILLIAMS: So I don't read that in the text of Secure Axcess
`to say you can't take the specification into account at all. What I see it
`saying is you shouldn't look at the specification without looking at the
`specification in view of what the claims are directed to. And I think that
`becomes quite clear when you read then certainly the Court's opinions and
`denying all reconsideration of the Secure Axcess case. I mean, what you'll
`see is obviously there was a great split in the Court, but the only reason that
`that panel opinion was upheld ultimately was because of the opinion Judge
`Plager wrote in connection with denying the reconsideration when he
`reinterpreted what Secure Axcess actually says. And he makes clear it's not
`a dramatic decrease in the scope of the CBM program. All it says is that you
`must look at the claim language. When you do that, you need to look at the
`claim language in the context of everything else, including the specification.
`I mean, he makes that very clear. So this is on slide 6, by the way. He says
`a qualifying claim does not require talismanic words. Nor is consideration
`limited to only the words in the claim as written. A claim in a patent does
`not live in isolation from the rest of the patent. Claims must be properly
`construed that it's understood in light of the written description.
`So I would say that is a statement of good law. The judges who
`voted to not hear this case en banc, again, explicitly relied on this opinion in
`reaching that conclusion. And the rest of the judges actually would have
`reheard the case anyway because quite clearly I think they thought the
`program should be broader than it seems to be in the original opinion.
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`CBM2017-00019 (Patent 7,840,437 B2)
`CBM2017-00023, IPR2017-00454 (Patent 8,719,090 B2)
`CBM2017-00032, IPR2017-00717, IPR2017-00724 (Patent 9,053,494 B2)
`
`
`Moving to the second prong of the test, let's turn to slide 21. So
`here in terms of looking at what the technical problem using a technical
`solution aspect would have been, patent owner wants to focus on security,
`access today that by authorized users. What they are describing here is
`digital rights management. You need some way to control access to the
`data. Those problems were long solved. Those were in the prior art. So our
`'437 petition does a pretty detailed analysis of the Stefik and Ginter patents
`to show where all these features of DRM were actually in the prior art,
`where this problem had actually been solved. Nothing in the patent or in the
`claims solves any of those problems. So what the claims are directed to is a
`business problem of renting data to a user and that's it. So there's no
`technological feature here that was an advancement over the art in this
`particular area.
`The problem itself was just a business problem, renting content.
`And the solution isn't technical. They just recite generic components. Slide
`27 is the claim. We'll see as we go through the 101 analysis how all these
`elements were committed to be well known. Nothing new in any of the
`them. The only thing that was discussed during prosecution as being new
`was this last element notifying data supplier. But that's not a technological
`solution at all. That's just a step of having communication between a
`customer and supplier.
`JUDGE KIM: Counsel, doesn't patent owner argue that it's the
`arrangement of the technical parts, that it's part of the technical -- that's part
`of the solution? For example, I believe they say something about separating
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`CBM2017-00019 (Patent 7,840,437 B2)
`CBM2017-00023, IPR2017-00454 (Patent 8,719,090 B2)
`CBM2017-00032, IPR2017-00717, IPR2017-00724 (Patent 9,053,494 B2)
`
`the memory from the processing circuitry and then that separation is a
`technical solution?
`MR. WILLIAMS: So we didn't see any evidence that that was a
`new solution. I'll talk a little bit more about that when we get into the 101
`analysis. So if we could table that discussion just a little bit because it is
`important and I want to go through it. But in general what I would say is
`there's a really unrebutted evidence from our expert, Tony Wechselberger,
`that this integrated system, the way it's described and the way it's organized,
`there was nothing new about it. These were all well-known components
`used in exactly the known way simply to implement this business solution,
`which also, by the way, was a well-known idea.
`But so that's our response to that. And the fact that there was -- the
`Board found a defect in our petition in terms of tying the particular elements
`of the prior art to the processing circuitry and then the microprocessor that
`controls all of those components, I think, doesn't mean that that was
`somehow an advancement for the art. It certainly wasn't one that the
`examiner found. The examiner found all of those elements present, and
`none of those rejections were traversed.
`JUDGE KIM: What about, they go into a lot of analysis about
`industry standards, so the ISOs and JTC standards setting forth saying there's
`an explosion of data and there's all these problems, so here is some technical
`standards to meet that problem.
`MR. WILLIAMS: I think that would be an interesting argument if
`they could tie any of that to the actual claim language here in the solution
`that they are purporting to bring to the table. But they can't. The solution
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`CBM2017-00019 (Patent 7,840,437 B2)
`CBM2017-00023, IPR2017-00454 (Patent 8,719,090 B2)
`CBM2017-00032, IPR2017-00717, IPR2017-00724 (Patent 9,053,494 B2)
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`they are bringing to the table is using well-know