EBAY INC.v.Moneycat Ltd.Download PDFPatent Trial and Appeal BoardMay 1, 201512539141 (P.T.A.B. May. 1, 2015) Copy Citation Trials@uspto.gov Paper 9 Tel: 571-272-7822 Entered: May 1, 2015 UNITED STATES PATENT AND TRADEMARK OFFICE _______________ BEFORE THE PATENT TRIAL AND APPEAL BOARD _______________ EBAY INC., Petitioner, v. MONEYCAT LTD., Patent Owner. _______________ Case CBM2015-00008 Patent 8,195,578 B2 _______________ Before WILLIAM V. SAINDON, BRYAN F. MOORE, and ROBERT J. WEINSCHENK, Administrative Patent Judges. MOORE, Administrative Patent Judge. DECISION Denying Institution of Covered Business Method Patent Review 37 C.F.R. § 42.208 CBM2015-00008 Patent 8,195,578 B2 2 I. INTRODUCTION On October 8, 2014, eBay Inc. (“Petitioner”) filed a Petition (Paper 1) requesting review of claims 4 and 12 of U.S. Patent No. 8,195,578 B2 (Ex. 1001, “the ’578 patent”) under the transitional program for covered business method patents. MoneyCat Ltd. (“Patent Owner”) filed a Preliminary Response (Paper 7, “Prelim. Resp.”). We have jurisdiction under AIA 1 § 18(a) and 37 C.F.R. § 42.300 (2013). A. Related Matter: Case CBM2014-00093 (“the 093 proceeding”) Petitioner filed an earlier Petition that sought a covered business method patent review of claims 1–23 of the ’578 patent. eBay Inc. v. MoneyCat Ltd., Case CBM2014-00093 (“CBM2014-00093”), Paper 4 2 (PTAB August 14, 2013) (“the 093 Petition” or “093 Pet.”). We granted review of claims 1–3, 5–11, and 13–23, and denied review of claims 4 and 12. CBM2014-00093, Paper 14 (“093 Dec. on Inst.”). Petitioner filed an unsuccessful Request for Rehearing, seeking reconsideration of our decision denying review of claims 4 and 12. CBM2014-00093, Paper 16 (Request for Rehearing). Petitioner then filed the instant Petition, challenging the patentability of each claim that was denied review in the 093 proceeding. Pet. 1. 1 See Leahy-Smith America Invents Act, Pub. L. No. 112-29, 125 Stat. 284 (2011) (“AIA”). 2 Replacement Petition. CBM2015-00008 Patent 8,195,578 B2 3 A. The ’578 Patent 1. Specification of the ’578 Patent The ’578 patent discloses a method and system for electronic currency transactions. See Ex. 1001, 3 Abstract. Figures 6 and 7 are shown below: Figure 6 schematically illustrates a sum of electronic money, and Figure 7 schematically represents an electronic currency transaction. See id. at 12:60–64. Referring to Figure 6, each data packet P1, P2, . . . Pi corresponds to an amount of electronic money. See id. at 14:33–39. Each packet Pi contains (from right to left in Figure 6) a unique identifier UINi, which identifies packet Pi among all such data packets issued by a Currency Issuing Authority (“CIA”); the monetary value associated with packet Pi; and authentication data ADi to confirm packet Pi was generated by the CIA. See id. at 13:17–22, 14:49–54. 3 Exhibit 1001 contains the ’578 patent and one ex parte reexam certificate concerning the ’578 patent. All citations to Exhibit 1001 in this decision refer to the ’578 patent unless otherwise specified. CBM2015-00008 Patent 8,195,578 B2 4 Turning to Figure 7, user 1 interacts with provider 2 via the Internet (broken arrows) to effect a payment of electronic currency to provider 2. See id. at 15:60–16:1. User 1 has data packets Pi stored in an active data packet area of a data storage area accessible by a CIA server (“CIAS”). See id. at 14:62–15:30. When user 1 and provider 2 decide upon a transaction, user 1 instructs the CIAS to effect payment to provider 2 of the required sum on behalf of user 1. See id. at 15:62–16:1. In response, the CIAS accesses the active data packet area of user 1 to copy to a local memory of the CIA one or more data packets Pi corresponding to the indicated sum, and delete or deactivate the packets Pi from the active data packet area. See id. at 16:10–16. The CIAS verifies the authentication data ADi of the packets Pi, and checks the identifiers UINi of the packets Pi against a database of previous transactions, to verify the packets Pi have not been used previously to effect payment. See id. at 16:24–28. If the CIAS verification is successful, the CIAS invalidates the packets Pi provided by user 1, and issues a new set of packets Pi for the same value to provider 2. See id. at 16:28–37. 2. Admitted Prior Art NetCash System In a section entitled “Background of the Invention,” the ’578 patent discusses several systems for carrying out electronic payment transactions that were known prior to the filing of the ’578 patent. See Ex. 1001, 1:22– 27, 1:55–56. One such prior art system is “NetCash.” Id. at 2:47. Petitioner relies on the NetCash admitted prior art as a basis for asserting two grounds for unpatentability. See, e.g., Pet. 24–49. In our discussions below, we will refer to the disclosure of admitted prior art at 2:47–3:39 and Fig. 2 of the ’578 patent as “the APA NetCash System.” CBM2015-00008 Patent 8,195,578 B2 5 B. Illustrative Claim Claims 1 and 4 of the ’578 patent are illustrative of the challenged claims: 1. A method for effecting currency transactions between a first user and a second user over a network wherein said currency is money-representing data packets, the method comprising the following steps: 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, 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); B) the CIAS accesses one or more money-representing data packets in a first active data packets area located in a first data storage area associated with said first user, each of said money-representing data packets comprising information on its value, wherein each of said money- representing data packets and said information on its value are both created by said CIA; C) the CIAS manipulates the money-representing data packets located in said first active data packets area to withdraw a second monetary sum therefrom and (i) deletes one or more money-representing data packets in the first active data packets area that equals the second monetary sum or (ii) marks one or more money-representing data packets in the first active data packets area that equals the second monetary sum as spent; and D) the CIAS creates one or more new money- representing data packets corresponding to a third monetary sum. 4. A method according to claim 1, wherein the new money- representing data packets are used to calculate the balance in a second data storage area associated with the second user. CBM2015-00008 Patent 8,195,578 B2 6 C. Related Matters In MoneyCat, Ltd. v. PayPal, Inc., No. 1:13-cv-01358 (D. Del. filed July 30, 2013), Patent Owner has asserted the ’578 patent against PayPal, Inc. — a privy of Petitioner. See Pet. 5. In addition to the present Petition challenging the ’578 patent and CBM2014-00093 discussed above, Petitioner has sought review of U.S. Patent Nos. 8,051,011 B2 (“the ’011 patent”) (CBM2014-00091) and 7,590,602 B1 (“the ’602 patent”) (CBM2014-00092). See Pet. 5. The ’578 patent is a continuation of the ’602 patent, and the ’011 patent is a division of the ’602 patent. D. Prior Art Relied Upon Bernstein US 5,915,023 June 1999 Ex. 1006 Teramura CA 2,221,399 June 2002 Ex. 1007 Chang US 5,848,400 Dec. 1998 Ex. 1008 APA NetCash System (Ex. 1001, 2:47–3:39, Fig. 2) E. Alleged Grounds of Unpatentability Petitioner contends that claims 4 and 12 of the ’578 patent are unpatentable based on the following grounds: Basis Reference(s) Claim(s) Challenged § 103(a) Teramura, the APA NetCash System, and Chang 4 and 12 § 103(a) Bernstein, the APA NetCash System, and Chang 4 and 12 CBM2015-00008 Patent 8,195,578 B2 7 II. ANALYSIS As set forth in 35 U.S.C. § 325(d), the Director, and by delegation the Board, 4 has discretion to deny a petition that raises substantially the same prior art or arguments previously presented to the Office. That statutory provision provides as follows: In determining whether to institute or order a proceeding under this chapter, chapter 30, or chapter 31, the Director may take into account whether, and reject the petition or request because, the same or substantially the same prior art or arguments previously were presented to the Office. The instant Petition challenges each claim that was denied review in the 093 proceeding. Compare 093 Pet. 44, 47–48, 59–60 with Pet. 32–38, 44–49 (both raising obviousness challenges against claims 4 and 12); see 093 Dec. on Inst. 21, 29–30 (denying review of those claims). The instant Petition relies on four pieces of prior art: three that were raised in the 093 Petition (Teramura, Bernstein, and APA); and one that is new to this proceeding (Chang). Compare 093 Pet. 21 with Pet. 25. Petitioner, however, presents no argument or evidence that the newly cited reference was not known or available to it at the time of filing of the 093 Petition. See Unilever, Inc. v. Procter & Gamble Co., Case IPR2014-00506, slip. op. at 6 (PTAB July 7, 2014) (in exercising § 325(d) discretion, one factor is whether newly cited references were known or available to a petitioner at the time of filing of the earlier petition) (informative). On this record and for the reasons set forth below, we exercise our discretion and “reject the petition” because “the same or substantially the same prior art or arguments 4 37 C.F.R. § 42.4(a) (“The Board institutes the trial on behalf of the Director.”). CBM2015-00008 Patent 8,195,578 B2 8 previously were presented to the Office” in the 093 proceeding. 35 U.S.C. § 325(d). We are persuaded that arguments raised in the Petition are “substantially the same” as those “previously [] presented to the Office” in the 093 proceeding. Id. Petitioner’s treatment of claim 4 is illustrative. Claim 4 includes all the limitations of claim 1 and, further, requires new money-representing data packets are used to calculate the balance in a second data storage area associated with the second user. In the 093 Petition, Petitioner argued that Bernstein (or Teramura) and APA discloses each limitation of claim 1 and argued Bernstein (or Teramura) discloses the “calculating a balance” feature of claim 4. 093 Pet. 56–59. We denied review on the ground that Bernstein did not disclose “new money-representing data packets are used to calculate the balance in a second data storage area associated with the second user” at all. 093 Dec. on Inst.16. We maintain our finding that neither Bernstein or Teramura teaches or suggests calculating a balance in a second data storage area using new money representing packets. Additionally, this limitation was not impacted by any claim construction in the 093 Decision; thus, Petitioner cannot argue that its failure to show this limitation in the cited art of the 093 Petition was because of an unanticipated claim construction issue. In the instant Petition, Petitioner repeats the same arguments as to claim 1 but, in lieu of Bernstein (or Teramura), relies on a new piece of prior art (Chang) for a disclosure of the “calculating a balance” limitation of claim 4. Pet. 45–46. In both petitions, Petitioner advances “substantially the same” argument—namely, that claim 4 would have been obvious over Bernstein (or Teramura) and APA. 35 U.S.C. § 325(d). The instant Petition CBM2015-00008 Patent 8,195,578 B2 9 does add Chang for further support but maintains the same citations to Bernstein and Teramura as in the 093 Petition. Compare 093 Pet. 44 with Pet. 34–35 and 093 Pet. 59 with Pet. 45–46. We find that Chang does not discuss calculating a balance in the context of “new money representing data packets” as required by claim 4. Prelim. Resp. 3–4. We agree with Patent Owner that “Chang relates to processing electronic checks, as indicated by its title: ‘Electronic check exchange, clearing and settlement system.’” Id. Notably, during prosecution the term “money representing data packets” was added to distinguish over a reference that disclosed electronic checks. Prelim. Resp. 4; Ex. 2003 at 4. Thus, Petitioner relies on Bernstein (or Teramura) and APA, not Chang, to disclose new money representing data packets and relies on Chang simply for the concept of calculating a balance. Further, Petitioner’s argument in the 093 Petition appears to have been that one of ordinary skill would understand how to calculate a balance using new money representing data packets, because they did not present any references that showed such a calculation. Thus, Petitioner is simply now presenting a reference to show what Petitioner previously implied was within the skill of one of ordinary skill in the art. We have considered all of the papers filed in both proceedings. Specifically, Petitioner argues that the instant Petition “further address[es] these two dependent claims based upon an additional prior art reference.” Pet. 1. Patent Owner, on the other hand, contends that Petitioner seeks to augment challenges that were rejected in the 093 proceeding, “[a]rmed with the Board’s guidance as to the flaws in the [093 Petition].” Prelim. Resp. 2– 3. On this record, we determine that the instant Petition presents “the same CBM2015-00008 Patent 8,195,578 B2 10 or substantially the same prior art or arguments” that were advanced in the 093 Petition. 35 U.S.C. § 325(d). Petitioner has not presented considerations that tip the balance in favor of review. Given that we already have considered the same or substantially the same prior art or arguments in connection with the challenged claims, we deny the request for an inter partes review under § 325(d). III. ORDER It is ORDERED that the Petition is denied as to all challenged claims of the ’578 patent. CBM2015-00008 Patent 8,195,578 B2 11 FOR PETITIONER: Scott McKeown Greg Gardella OBLON, SPIVAK, MAIER, MCCLELLAND, AND NEUSTADT, LLP CPdocketmckeown@oblon.com CPdocketgardella@oblon.com FOR PATENT OWNER: Kevin D. McCarthy David L. Principe ROACH BROWN MCCARTHY & GRUBER, P.C. kdmccarthy@roachbrown.com bcreola@roachbrown.com Howard Wisnia MINTZ LEVIN HWisnia@mintz.com Copy with citationCopy as parenthetical citation