Ex Parte 7690991 et al

Patent Trial and Appeal Board

Dec 6, 2013

95000561 (P.T.A.B. Dec. 6, 2013)

UNITED STATES PATENT AND TRADEMARK OFFICE
UNITED STATES DEPARTMENT OF COMMERCE
United States Patent and Trademark Office
Address: COMMISSIONER FOR PATENTS
P.O. Box 1450
Alexandria, Virginia 22313-1450
www.uspto.gov
APPLICATION NO. FILING DATE FIRST NAMED INVENTOR ATTORNEY DOCKET NO. CONFIRMATION NO.
95/000,561 10/26/2010 7690991 11357.0001 9980
21171 7590 12/09/2013
STAAS & HALSEY LLP
SUITE 700
1201 NEW YORK AVENUE, N.W.
WASHINGTON, DC 20005
EXAMINER
BONSHOCK, DENNIS G
ART UNIT PAPER NUMBER
3992
MAIL DATE DELIVERY MODE
12/09/2013 PAPER
Please find below and/or attached an Office communication concerning this application or proceeding.
The time period for reply, if any, is set in the attached communication.
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
____________________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________________

GLOBAL BETTING EXCHANGE
Requestor, Respondent

v.

THE SPORTING EXCHANGE, LTD.
Patent Owner, Appellant
____________________

Appeal 2013-009036
Inter partes Reexamination 95/000,561
US Patent 7,690,991 B2
Technology Center 3900
____________________

Before: HOWARD B. BLANKENSHIP, MEREDITH C. PETRAVICK, and
WILLIAM V. SAINDON, Administrative Patent Judges.

SAINDON, Administrative Patent Judge.

DECISION ON APPEAL
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STATEMENT OF THE CASE
Patent Owner appeals under 35 U.S.C. § 134 from the Examiner’s
decision to reject claims 1-35. We have jurisdiction under 35 U.S.C. § 134.
We held an oral hearing on October 16, 2013 with representatives from both
the Patent Owner and the Requester present. We AFFIRM-IN-PART the
Examiner’s decision.

The Claimed Subject Matter
The claims generally read on a betting exchange system that allows
users to bet against each other. The claimed system aggregates equivalent
bets made by different users such that it operates similar to a stock
exchange. Claim 1, reproduced below, is illustrative of the claimed subject
matter.
1. A betting exchange system for permitting a plurality of users to bet
against one another, the system comprising:
a server configured to receive bet offers and bet requests from the
plurality of users over a communications network, each of said offers
specifying a price at which the user originating the offer is prepared to lay a
given outcome, together with a bet size offered at said price,
the server being arranged to aggregate said offers to provide a first set
of information for display to said plurality of users, said first set of
information including the best price at which each of the possible outcomes
is available to be backed at a given time and the aggregated size available at
said best price, and each of said requests specifying a price at which the user
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originating the request is prepared to back a given outcome, together with a
bet size requested at said price,
said server being operable to match said bet offers with said bet
requests based on said specified prices and sizes,
and in the event that the server cannot match said requests at the
prices and sizes specified, the server being further arranged to aggregate said
bet requests to provide a second set of information for display to said
plurality of users, said second set of information including the best price at
which each of the possible outcomes is available to be laid at a given time
and the aggregated size available at said best price, and
the server being operable to update the first and second sets of
information for display to said users in response to received bet offers and
bet requests, such that said users can in real-time see the best price at which
they can back or lay any outcome and the total size available at that price,
to thereby permit the plurality of users to bet against one another.

Rejections & Prior Art
The Examiner makes the following rejections under 35 U.S.C.
§ 103(a):
I. Claims 1-7, 12-26, and 31-35 over Silverman1 and Lavnick2.
II. Claims 1-7, 12-26, and 31-35 over Bet Exchange3 and Silverman.
III. Claims 1-7, 12-26, and 31-35 over WagerNet4 and Silverman.

1
US 5,136,501 issued Aug. 4, 1992.
2
Lavnick and Sandberg, Leaving Las Vegas Behind (July 1996).
3
Bet Exchange (posted to newsgroupit.hobby.totoscommesse) (Jan. 2000).
4
WagerNet homepage (archived Feb. 27, 1997).
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IV. Claims 1-7, 12-26, and 31-35 over Rossides5, Silverman and Lavnick.
V. Claims 1-7, 12-26, and 31-35 over Bet Exchange, Rossides, and
Silverman.
VI. Claims 8-11 and 27-30 over Bet Exchange, Silverman, and Wilton6.
VII. Claims 8-11, 14-16, 20-22, and 27-30 over Bet Exchange, Silverman,
and Orford
7
.
VIII. Claims 8-11 and 27-30 over WagerNet, Silverman, and Wilton.
IX. Claims 8-11, 14-16, 20-22, and 27-30 over WagerNet, Silverman, and
Orford.
X. Claims 8-11 and 27-30 over Rossides, Silverman, Lavnick, and
Wilton.
XI. Claims 8-11, 14-16, 20-22, and 27-30 over Rossides, Silverman,
Lavnick, and Orford.
XII. Claims 8-11 and 27-30 over Silverman, Lavnick, and Wilton.
XIII. Claims 8-11, 14-16, 20-22, and 27-30 over Silverman, Lavnick, and
Orford.

OPINION
Throughout their briefs and during the oral hearing, a main argument
of Patent Owner is that the claimed betting exchange aggregates bets. Patent
Owner contrasts an exchange that aggregates bets with a so-called eBay
system of one-to-one matching. Because this argument is pervasive, we first
construe the claims and resolve this construction issue before explaining the
prior art and, finally, reviewing the rejections in light of the arguments
raised.

5
WO 97/15362 published May 1, 1997.
6
US 6,519,574 issued Feb. 11, 2003.
7
US 5,672,106 issued Sep. 30, 1997.
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“Aggregation,” and Exchange v. eBay Betting Models
Patent Owner argues throughout the briefs that the cited prior art
references do not describe or suggest “aggregation” of bets. See, e.g., App.
Br. PO 14, 27. However, Patent Owner offers no cogent claim construction
of “aggregation.” In view of the ’991 Specification, we find that the bets
made in the claims are between individuals, and the system is merely
matching each bettor to potentially more than one bettor in order to match
wager amounts. As such, the “aggregation” feature of the claims, when read
by one of ordinary skill in the art in a manner consistent with the
Specification, means that, as necessary, an individual’s bet may be filled by
more than one other bettor or may be used with one or more other bettors to
fill another bet. As a consequence, “aggregation”-type bets include one-to-
many as well as many-to-many relationships.
We base this finding on the disclosure of the ’991 patent. The system
matches the bets of individuals, with larger bets being spread among smaller
matching bets as necessary to fulfill as many bets as possible. See, e.g.,
’991 patent, col. 1:37-40 (“requests comprising a bet backing . . . or laying
an outcome, wherein the server . . . match[es] respective bets.”), 39-47
(describing the placing and filling of bets). The ’991 patent explicitly
considers one-to-many bet fulfillment as an aggregation. See, e.g.,
id. at 7:41-46 (Charlotte’s £80 bet is fulfilled by Alex’s £50 bet and £30 of
Belinda’s bet).
Although not found in the claims, we must also determine what the
eBay model of betting includes in order to properly interpret the prior art and
Patent Owner’s arguments, which make use of such a phrase. It is important
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to consider the context in which the eBay analogy is made. eBay is a
website in which sellers post items for sale and individuals bid for the right
to purchase that item. A unique feature, at the time, was that eBay, in
essence, was like a store in that users went to a place to buy goods, but many
individuals (or businesses) sold the goods, as opposed to being sold by eBay
itself. eBay was thus a market maker as opposed to a merchant. Implicit in
this auction system was that a seller of an item had a unique listing for each
item and a bidder bid on that particular item. In view of the above, we
understand one-to-one, undividable fulfillment to be the “eBay” or “one-to-
one” model. The eBay model cannot, therefore, take Abel’s bid of $50 and
Bob’s bid of $50 to satisfy Carla’s sale price of $100. On the other hand,
Abel’s bid of $120 would be sufficient to satisfy Carla’s sale price of $100.

The Prior Art
With an understanding of the aggregation concept, we turn to the main
prior art references used by the Examiner.

Silverman
Silverman describes an automatic matching system for the sale and
purchase of trading instruments. Silverman 1:18-26. Silverman’s system
aggregates offers to buy and offers to sell at the same price level. Id. at
10:28-30 and 11:9-14. If the system in Silverman finds a match between
offers to buy and sell, the system automatically completes the trades. Id. at
Abstract. The trading instruments in Silverman are not explicitly described
as including bets. Further, we find that Silverman’s novel disclosure is
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mainly along the lines of using credit limits in making transactions.
Id. at 1:24-26. Silverman mentions the aggregation aspects as afterthoughts
and as such, we find this as evidence that one of ordinary skill in the art
would have already have been familiar with such a concept. See also
“Betting Exchanges Oust the Bookies” (“aggregate bets to create stock
exchange-style pools of liquidity,” highlighting that it would have been
understood by one of ordinary skill in the art that stock exchanges and the
like use aggregation).

Lavnick
Lavnick describes an internet betting site called WagerNet. Lavnick
2. Lavnick describes WagerNet as “[s]imilar to NASDAQ, which is a
computerized system matching buyers and sellers of stock at an agreed
price.” Id. Because WagerNet is compared to NASDAQ, a stock exchange,
we find that it is reasonable that one of ordinary skill in the art would
conclude that WagerNet has similar features as a stock exchange. As we
found above, one of ordinary skill in the art would attach the concept of
aggregation to stock exchanges. Accordingly, we find that one of ordinary
skill in the art would, upon reading Lavnick, consider WagerNet to have
aggregation of bets.
8

8
Our finding here is only relevant to the inquiry of the level of ordinary skill
in the art at the time of invention for consideration of the obviousness
question. The Examiner’s rejections do not rely on this finding nor do we
seek to incorporate this finding into the Examiner’s rejection. See Randall v.
Rea, slip op. 2012-1611 at 12-13 (Fed. Cir. 2013) (distinguishing between
the “combination that formed the basis of the Examiner’s rejections” and
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Bet Exchange
Bet Exchange describes a market for making and accepting bets with
other users. Bet Exchange 1. Depending on the size of the bet and demand,
“offers may be taken in part, in full, or not at all.” Id. at 1. Bet Exchange is
not clear as to whether taking a bet in part means the bet is split among
different bettors (i.e., aggregation) or if the remaining part is simply
discarded.

WagerNet
The WagerNet reference is an advertisement for the above-described
WagerNet betting site. WagerNet describes aggregations of bets, as it
“matches your bet with [an] opposing bettor or bettors to cover your wager.”
Accordingly, WagerNet discloses one-to-many aggregation, which confirms
our finding above that WagerNet would have been understood by one of
ordinary skill in the art to include aggregation of bets.
9

Rossides
Rossides describes a market that enables direct betting between users.
Rossides, Abstract. Rossides does not discuss clearly the aggregation of
bets.

“references [that are] important evidence of the state of the art and the
context in which the Examiner-cited combination should be evaluated.”).
9
See n. 8.
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The Rejections
The independent claims are rejected based on a combination of one or
more of the above references. The Examiner’s rejections were made by
adopting and incorporating by reference, without modification, certain
rejections proposed by Requester. See RAN 5-8. In general, Silverman is
used to teach all of the bidding, matching, and aggregation features of the
claims, except for the concept of the market being one of bets as opposed to
trading instruments.
10
See Req. 44-45, 52, 55, 56. The various rejections
then cite to the Bet Exchange, Rossides, or WagerNet betting markets
11
for
supplying the teaching (in various levels of detail) that it was known to have
an exchange for bets. See Req. 44, 52, 54-55, 55-56; see also, e.g., ACP 8
(“Lavnick is relied upon for developing the connection between stocks based
buyer and seller matching and sports book buyer and seller [matching]”),
ACP 10 (highlighting Lavnick’s discussion of a NASDAQ-like betting
system), ACP 12-13 (discussing Bet Exchange as linking sports betting to a
free market). The rejections propose to modify the bidding, matching, and
aggregation features of the market of Silverman to include wagers, based on
the teachings of the Bet Exchange, Rossides, and WagerNet betting markets.

10
While the issue is not before us, we fail to see the functional difference
between a system that matches buyers and sellers of trading instruments
such as stocks versus a system that matches buyers and sellers of bets. In
each case, something is being bought and sold at a price. The difference lies
only in the word one may call the thing being bought and sold, but not in the
function of the system.
11
Lavnick discusses the WagerNet betting market.
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Patent Owner’s Arguments
We first address Patent Owner’s arguments regarding the particular
rejections and then address Patent Owner’s secondary considerations
arguments. For rejections I-V, Patent Owner argues the independent claims
(1, 2, 34, and 35) as a group and dependent claims 3-7, 12-26, and 31-33 as a
group. We select claim 1 and 3 as representative of their groups. Patent
Owner does not present separate arguments for the dependent claims, such
that the resolution of the issues for claim 1 will control the resolution for
claim 3. We address rejections VI-XIII, which cover at least claims 8-11
and 27-30, separately.

Silverman and Lavnick
Patent Owner argues that the Examiner improperly interpreted the
term “price.” App. Br. 24-26. In particular, Patent Owner argues that the
Examiner erred in calling the price in Silverman a price because, in the
context of the present patent, a price refers to odds because what is being
bought is a bet. See id. Patent Owner’s argument fails because although
Silverman’s price does not explicitly include odds, such a fact is irrelevant
because the rejection does not rely on a finding that Silverman teaches a
price that means odds or that represents bets. Req. 51 (“Silverman ’501 fails
to disclose, however, that its trading instruments are bets”). Accordingly,
Patent Owner’s argument attacks the references in isolation rather than the
rejection as written.
Patent Owner also “emphasize[s] that Lavnick’s comparison is
between only the ‘matching’ features of both systems, without any
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implication of aggregation of bets or offers in the WagerNet system.” App.
Br. 24. First, as we discussed above, the WagerNet betting exchange uses
aggregation as claimed. Secondly, the rejection here does not rely on any
teaching in Lavnick of aggregation. Instead, the rejection relies on
Silverman to teach aggregation. Accordingly, Patent Owner’s argument
attacks the references in isolation rather than the rejection as written.
Patent Owner lastly argues that the secondary evidence “rebuts the
combination.” App. Br. 24. We address the secondary evidence arguments
as a group because Patent Owner refers to the same secondary evidence
arguments for each of the rejections. Before evaluating the secondary
evidence, however, we review Patent Owner’s specific arguments against
the remaining rejections, and then, with whatever rejections still stand,
evaluate the secondary evidence in view of all of the evidence to make a
final determination of obviousness.

Bet Exchange and Silverman
WagerNet and Silverman
Patent Owner does not present any new, separate arguments for these
rejections, instead relying on the secondary consideration argument we will
discuss later. App. Br. 26-28.

Rossides, Silverman, and Lavnick
Patent Owner alleges some shortcomings in Rossides relating to
aggregation but does not address the rejection as made, which is based on
Rossides, Silverman, and Lavnick. See App. Br. 28-30. Given that
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Silverman is relied on for display of aggregated items on a market (Req. 56),
these arguments do not apprise us of error. Patent Owner also relies on
secondary considerations, which we will discuss later.

Bet Exchange, Rossides, and Silverman
Patent Owner relies on arguments already made. App. Br. 30-31.

Bet Exchange, Silverman, and Wilton
WagerNet, Silverman, and Wilton
Rossides, Silverman, Lavnick, and Wilton
Silverman, Lavnick, and Wilton
These rejections address the limitation in claim 8 that “automatically
arbitrage[s] the bet requests to thereby generate one or more implied bets
made by the system . . . [for] an outcome for which no bet requests have
been received.” See ’991 patent, col. 8:20 to col. 9:55 (describing an
exemplary embodiment of this limitation). Claim 27 has a similar scope.
The Examiner found that Wilton and Orford disclose these limitations
in their respective rejections. Specifically, the Examiner found that Wilton
“describes ‘arbitrage’ opportunities that exist . . . whereby the system may
have a third party automatically make trades between parties with differing
bids.” See, e.g., Claim Chart 11, p. 1. Further, Wilton “identifies and
executes arbitrage opportunities ‘arising from price anomalies that arise due
to credit discrepancies within a market.’” Id.
Patent Owner argues that Wilton’s arbitrage opportunity occurs when
an offer matches a bid, whereas the claim generates a bet (akin to an offer)
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when no such bet (offer) has been made. App. Br. 31. This argument
apprises us of error in the Examiner’s rejection. We agree that Wilton is not
creating an offer when there is no match. See id. (“the arbitrage occurs
when trading entity S1 ‘enters an offer which matches a bid’”) (emphasis
removed). Instead, Wilton seeks to find a way to make two matching offers
result in a transaction using an intermediate party S3, not the system. Id. at
32 (explaining that the trade between S1 and S2 did not go through due to
lack of credit between the two and that S3 has credit ties with both and acts
as a bridge).
Requester responds that Wilton describes how to take advantage of an
arbitrage opportunity. Resp. Br. 12-13. However, the claim requires more
than merely some arbitrage to be performed; the claim requires a specific
form of arbitrage. Requester also responds to Patent Owner’s argument that
the arbitrage in Wilton is via entity S3, not the system, stating that the
system in Wilton “is not an actor attempting to make a profit or increase
liquidity.” Id. at 13. This argument appears to acknowledge that Wilton’s
system is not the entity making the arbitrage offer. Either way, Requester’s
response is not effective in defending the Examiner’s position.
In view of the above, we do not sustain rejections VI, VIII, X, and
XII, each of which includes the erroneous finding with respect to Wilton.

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Bet Exchange, Silverman, and Orford
WagerNet, Silverman, and Orford
Rossides, Silverman, Lavnick, and Orford
Silverman, Lavnick, and Orford
The Examiner relies on Orford to teach the same limitations of claims
8 and 27 for which the Examiner relied on Wilton. In particular, the
Examiner found that Orford teaches an implied bet by taking a portion of the
win totalizer pool to create an initial fixed odds betting dividend. See, e.g.,
Claim Chart 12 (citing Orford, col. 2:58 to col. 3:9).
Patent Owner argues that the dividend of Orford is “simply a
commission taken from the pool of all wagered money” and is not itself a
bet (or implied bet). App. Br. 32.
Turning to the cited portion of Orford, we find a betting system that
begins using a totalizer wagering (i.e., floating odds based on the actual
amounts wagered on each horse) and then at one point offers a fixed odds
(dividend) for each horse, roughly based upon the floating odds of the
totalizer at that point in time (less a commission the operator keeps). Orford,
col. 2:58 to col. 3:9.
While we disagree with Patent Owner that the dividend is a
commission, we agree that the dividend is not a bet for which no bet requests
have been received. Simply put, each fixed price bet is for an outcome for
which other bets have already been received in the totalizer wagering
session. The fixed price bets created by the system are bets offered for the
same outcomes as the totalizer.
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In view of the above, we do not sustain rejections VII, IX, XI, and
XIII, each of which includes the erroneous finding with respect to Orford.

Secondary Considerations
As a preliminary matter, Patent Owner first asks us to reverse (or
remand to) the Examiner on the basis that the Examiner did not properly
consider the secondary considerations. App. Br. 10-12; Reb. Br. 3. Patent
Owner’s argument is that the Examiner’s review and consideration of the
secondary considerations evidence was cursory and without sufficient
analysis. The Examiner, however, noted that he considered the secondary
evidence after reviewing the prior art, and more importantly, reviewed
Requester’s comments. ACP 27. Accordingly, the record is not lacking the
Examiner’s analysis of the secondary evidence; the Examiner is merely
agreeing with the Requester’s analysis, much like the Examiner’s rejections
are incorporations of Requester’s proposed rejections. As such, we decline
to reverse the Examiner’s decision merely because the Examiner relies on
Requester’s analysis.
Considering as a whole the secondary evidence offered (explained in
further detail below) and the evidence relied on by the Examiner (explained
above), we conclude that the record establishes a strong case of obviousness
of the claimed subject matter.

The News Articles and “You Bet” Book
Betfair is a betting exchange utilizing the claimed subject matter. See
App. Br. 13 (establishing the connection between Betfair and the claimed
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subject matter). Patent Owner offers many news articles describing the
success of Betfair (see App. Br. 14-19), which demonstrate to us that Betfair
has been a commercially successful venture. See, e.g., “Betting Exchanges
Oust the Bookies” (sidebar) (“[Betfair is now] the third-biggest betting firm
by volume in the UK”). Patent Owner also attempts to distinguish Betfair’s
success, using aggregation, from Betfair’s competitors’ failures, which
Patent Owner alleges do not use aggregation. App. Br. 14 (“aggregation . . .
set [Betfair] apart from its competitors”) (emphasis removed).
Not all commercial success stories, however, control the secondary
considerations analysis. There must be a nexus between the claimed
invention and the commercial success. Ormco Corp. v. Align Tech., Inc.,
463 F.3d 1299, 1311-12 (Fed. Cir. 2006). While we see that there is
commercial success of Betfair, and that Betfair’s betting exchange embodies
the claimed features
12
, there are exceptions. The important one here is: “if
the feature that creates the commercial success was known in the prior art,
the success is not pertinent.” Id. at 1312.
Reviewing all of the evidence, we find that the use of a stock
exchange-type model, using aggregation, was known in the prior art. As we
discussed above, the WagerNet system includes one-to-many aggregation, as
shown in at least the WagerNet and Lavnick articles. In addition, we find
that user-to-user betting (e.g., through an exchange, not a bookie) was
known in the prior art, as shown in the WagerNet, Lavnick, Bet Exchange,

12
See, e.g., “Betting Exchanges Oust the Bookies,” “Betfair’s technology . .
. allows it to aggregate bets to create stock exchange-style pools of
liquidity.”
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and Rossides articles. Accordingly, and as Requester further explains and
we agree, Betfair’s success story is based on non-novel and non-technical
aspects of Betfair’s company. See Resp. Br. 16-20 (offering that a favorable
legal environment and popularity of the basic betting exchange model are
large drivers of Betfair’s commercial success).

Copying
Patent Owner offers a second declaration of Mr. Davies, Betfair’s
managing director, as evidence of competitor copying. App. Br. 19. Patent
Owner merely alleges copying without anything further, however. “[M]ore
than the mere fact of copying … is needed to make that action significant to
a determination of the obviousness issue.” Cable Elec. Prods., Inc. v.
Genmark, Inc., 770 F.2d 1015, 1028 (Fed. Cir. 1985), overruled on other
grounds by Midwest Indus., Inc. v. Karavan Trailers, Inc., 175 F.3d 1356,
1358-61 (Fed. Cir. 1999) (en banc). Such additional considerations include
evidence of efforts of competitors to replicate a specific product, which may
be demonstrated through internal company documents, direct evidence such
as disassembling a patented prototype, photographing its features, and using
the photograph as a blueprint to build a replica, or access to the patented
product combined with substantial similarity to the patented product. Iron
Grip Barbell Co. v. USA Sports, Inc., 392 F.3d 1317, 1325 (Fed. Cir. 2004);
Akamai Techs., Inc. v. Cable & Wireless Internet Servs., Inc., 344 F.3d
1186, 1196-97 (Fed. Cir. 2003); Advanced Display Sys., Inc. v. Kent State
Univ., 212 F.3d 1272, 1285-86 (Fed. Cir. 2000). In the present case, all that
is shown is that the competitors have similar features, which could just as
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easily be further evidence that these features already were obvious or known
in the prior art.

The Queen’s Award
Patent Owner offers as evidence of non-obviousness the fact that
Betfair was awarded the “Queen’s Award” in innovation. App. Br. 19.
Patent Owner alleges, in a declaration by Mr. Davies, that “[t]he award was
given [according to Mr. Davies’ recollection], on the grounds that Betfair
betting exchange system was applying technology unprecedented in the
industry to a market which had never seen it, to the benefit of consumers and
regulators.” Id. (citing Davies Decl. of April 23, 2008, ¶¶ 3-7). This
declaration states that Queen’s Awards are awarded based on several
categories, including “the invention, design, production (of goods),
performance (of services, including advice), marketing, distribution, and
after sale support (of goods or services).” Davies Decl. of April 23, 2008 at
¶ 6.
The Queen’s Award is not awarded based on having a new and non-
obvious invention, necessarily, but also on other categories (e.g.,
performance, marketing). Mr. Davies’ declaration avoids discussing the
specific grounds on which the Award was given. As Requester points out,
Patent Owner has withheld the actual application and/or award, which it
would have in its control. Resp. Br. 20. It is unknown what aspects of the
invention, and of Betfair as a business, were considered to be innovative.
The scope of the award (UK) also must be taken into consideration, because
obviousness is weighed against all available prior art, not just the prior art
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available in one particular country. See 35 U.S.C. § 102. Thus, even if no
one in the UK knew about aggregation of bets, and as such, the Award was
given, this would not be determinative in this reexamination because
knowledge from other countries must be considered (e.g., WagerNet).

Industry Skepticism and Hindsight
Patent Owner points to the “You Bet” book and the “Racing; Betfair
Collects Award” article to support the notion that there was industry
skepticism as to the success of betting exchanges. App. Br. 20. These are
offered for the premise that “there was significant doubt from betting experts
at the time that Betfair would work, or at least would have any impact.” Id.
Missing, however, is any tie between skepticism of Betfair’s success
and what is claimed. The documents cited by Patent Owner only discuss
whether betting exchanges would be successful. See “You Bet” at 23 (the
experts “considered betting exchanges to be short-term, or with a minimal
future”); “Racing; Betfair Collects Award” (bookies “failed to foresee the
impact exchanges would have on their industry”). WagerNet, Bet Exchange,
and Rossides are clear examples of betting exchanges in the prior art, so all
that Patent Owner establishes is that there was skepticism from those with
the most to lose from exchange’s success (regular bookies) regarding a
product already on the market (bet exchanges).
A point worth reemphasizing is that the skeptics were bookies—those
with the most to lose by the success of betting exchanges. See “Revolution –
and the bells toll for thee, Mr. Bookmaker” (“the betting exchange
represents [] the death of the bookies’ margin and . . . bookmaking as it has
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US Patent 7,690,991 B2

20
been known”); “Turning the tables” (“the bookmakers have a vested interest
in knocking the exchanges which are eating into their profits” “[exchanges]
cut out their profit and that’s why they hate us”); “Betting exchanges oust
the bookies” (“Are the traditional bookies worried? Very. And they are
fighting back”). This significantly flavors the words of the so-called
“skeptics,” who would naturally dismiss betting exchanges.
Lastly, the skepticism does not appear to be directed to the technical
feasibility of the claimed subject matter, or specifically aggregation, but
rather whether the betting exchanges would be able to market and sell their
product in the face of an established (and hostile) industry.

New Zealand Opposition
Patent Owner offers as evidence of non-obviousness a decision by the
New Zealand Patent Office to dismiss an opposition proceeding against a
patent application having claim limitations “very similar to claim[s] 17 [and
18].” App. Br. 21-22. Patent Owner does not cogently explain how this
proceeding tends to show non-obviousness, aside from the fact that the
opposition was dismissed. As Patent Owner’s discussion of the proceeding
shows, the dismissal was because the particular expert relied on “has not
established that he has had experience in wagering or betting systems” and,
as such, “the evidence of these witnesses” does not establish obviousness.
App. Br. 22 (citing the New Zealand Opposition, pp. 17-18). Thus, the
decision was essentially that evidence underpinning the opposition was not
satisfactory, not that the particular subject matter at issue in this proceeding
was found unobvious.
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21
In addition, as the Requester points out, the particular provisions of
New Zealand law are such that only art “known in New Zealand” can be
used, and the standard of review is extremely high. Resp. Br. 21.
Accordingly, Requester concludes, the decision in the New Zealand
proceeding “has little bearing on this proceeding.” We agree.

Conclusion Regarding Secondary Considerations
To summarize, the evidence tending to show obviousness, discussed
in more detail above, establishes that aggregation is known for stock market-
type exchange and that it is also known for betting-type exchanges. It was
known to model betting in the manner of stock markets. WagerNet, for
example, describes one-to-many bet aggregation and compares itself to a
stock market-type exchange.
The evidence offered as tending to show non-obviousness, just
discussed, establishes that Betfair is successful and disruptive to the existing
betting regimes. However, this evidence generally lacks a nexus to the
claimed subject matter held out by Patent Owner to be novel, aggregation.
Instead, aggregation is discussed in the prior art. Further, the success of
Betfair also appears to be largely tied to legal and business considerations,
rather than technical. To the extent Betfair is successful over similar betting
exchanges due to its use of aggregation, aggregation was known in the art.
This is a case of successful application of a known technique, even if others
did not choose to utilize the known technique or were not as successful.
Accordingly, weighing the evidence of obviousness and the evidence
of non-obviousness, as a whole, anew, we agree with the Examiner’s
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22
determination that the evidence of obviousness outweighs the evidence of
non-obviousness.
In consequence, we sustain rejections I-V.

DECISION
We AFFIRM the Examiner’s decision to reject claims 1-7, 12-26, and
31-35.
We REVERSE the Examiner’s decision to reject claims 8-11 and 27-
30.
Requests for extensions of time in this proceeding are governed by 37
C.F.R. §§ 1.956 and 41.79(e).

AFFIRMED-IN-PART
ak

Stass & Halsey, LLP
Suite 700
1201 New York Avenue, NW
Washington, DC 20005

Third Party Requester:

James T. Wilson
Finnegan, Henderson, Farabow,
Garrett & Dunner, LLP
901 New York Avenue, NW
Washington, DC 20001-4413