Ex Parte Bates et al

Board of Patent Appeals and Interferences

Sep 19, 2007

09749106 (B.P.A.I. Sep. 19, 2007)

The opinion in support of the decision being entered today
is not binding precedent of the Board.

UNITED STATES PATENT AND TRADEMARK OFFICE

__________

BEFORE THE BOARD OF PATENT APPEALS
AND INTERFERENCES
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Ex parte CARY LEE BATES and PAUL REUBEN DAY
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Appeal 2007-1775
Application 09/749,106
Technology Center 2600
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Decided: September 19, 2007
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Before JOHN C. MARTIN, JOSEPH L. DIXON, and
ST. JOHN COURTENAY III, Administrative Patent Judges.

COURTENAY, Administrative Patent Judge.

DECISION ON APPEAL
This is a decision on appeal under 35 U.S.C. § 134(a) from the
Examiner’s rejection of claims 1-4 and 6-31.1 We have jurisdiction under
35 U.S.C. § 6(b). We AFFIRM.

1 The Examiner has indicated that claim 5 would be allowable if rewritten in
independent form (Answer 8).
Appeal 2007-1775
Application 09/749,106

THE INVENTION
The disclosed invention relates to the information processing field.
More particularly, the invention relates to methods and apparatus for pricing
programming events viewed by multiple viewers (Specification 1).
Independent claims 1 and 22 are illustrative:
1. A method for determining a price of a program
transmitted by a programming provider to subscribers,
comprising:

receiving, via a network connection, a purchase order for
a program from a subscriber belonging to a subscriber group
defined by two or more subscribers, wherein each subscriber
belonging to the subscriber group maintains an independent
account with the programming provider whereby the subscriber
pays the programming provider in order to receive paid for
programming, and wherein each subscriber belonging to the
subscriber group may elect to purchase or not purchase the
program;

determining a first price for the purchase order if the
program has been purchased by a threshold number of
subscribers belonging to the subscriber group; and

determining a second price, higher than the first price, if
the program has not been purchased by the threshold number of
subscribers belonging to the subscriber group.

22. A system comprising:

a plurality of signal processing units each associated with
one of a plurality of subscribers, wherein the plurality of
subscribers make up subscriber groups each including at least
two subscribers; and

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a programming provider system connected to the signal
processing units and configured to:

transmit fee-based programming events to the signal
processing units; and

determine prices of programming event purchased by the
plurality of subscribers, wherein a price for each programming
event is determined according to a number of purchase orders
for the same programming event received from subscribers
belonging to a same subscriber group, wherein the price
decreases in proportion to increasing orders from different
subscribers belonging to the same subscriber group, wherein
each subscriber belonging to the subscriber group maintains an
independent account with the programming provider whereby
the subscriber pays the programming provider in order to
receive paid for programming, and wherein each subscriber
may elect to purchase or not purchase each programming event.

THE REFERENCES
Pallakoff US 6,269,343 B1 July 31, 2001
Bonomi US 6,769,127 B1 July 27, 2004

THE REJECTIONS
Claims 1-4 and 6-31 stand rejected under 35 U.S.C. § 103(a) as being
unpatentable over the teachings of Bonomi in view of Pallakoff.
Rather than repeat the arguments of Appellants or the Examiner, we
make reference to the Briefs and the Answer for the respective details
thereof.

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Appellant has the burden on appeal to the Board to demonstrate error
in the Examiner’s position. See In re Kahn, 441 F.3d 977, 985-86,
78 USPQ2d 1329, 1335 (Fed. Cir. 2006) (“On appeal to the Board, an
applicant can overcome a rejection [under § 103] by showing insufficient
evidence of prima facie obviousness or by rebutting the prima facie case
with evidence of secondary indicia of nonobviousness.”) (quoting In re
Rouffet, 149 F.3d 1350, 1355, 47 USPQ2d 1453, 1455 (Fed. Cir. 1998)).
Therefore, we look to Appellants’ Briefs to show error in the proffered
prima facie case.
Initially, we note that Appellants have presented no arguments
directed to the combinability of Bonomi and Pallakoff with each other.
Accordingly, Appellants have waived any such arguments, and the
combinability of the references will not be addressed here. See 37 C.F.R.
§ 41.37(c)(1)(vii) (2005) (“Any arguments or authorities not included in the
brief or a reply brief filed pursuant to Sec. 41.41 will be refused
consideration by the Board, unless good cause is shown.”).

STATEMENT OF LAW
“What matters is the objective reach of the claim. If the claim extends
to what is obvious, it is invalid under § 103.” KSR Int’l Co. v. Teleflex, Inc.,
127 S. Ct. 1727, 1742, 82 USPQ2d 1385, 1397 (2007). To be nonobvious,
an improvement must be “more than the predictable use of prior art elements
according to their established functions.” Id. at 1740, 82 USPQ2d at 1396.
The proponent of a holding of obviousness is required to show
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that a person of ordinary skill in the art would have had reason
to attempt to make the composition or device, or carry out the
claimed process, and would have had a reasonable expectation
of success in doing so. See Medichem [S.A. v. Robalo, S.L.]
437 F.3d [1157,] 1164 [(Fed. Cir. 2006)]; Noelle v. Lederman,
355 F.3d 1343, 1351–52 [69 USPQ2d 1508] (Fed. Cir. 2004);
Brown & Williamson Tobacco Co. v. Philip Morris, Inc., 229
F.3d 1120, 1121 [56 USPQ2d 1456] (Fed. Cir. 2000); see also
KSR Int'l Co. v. Teleflex Inc., 127 S. Ct. 1727, 1740 [82
USPQ2d 1385] (2007) (a combination of elements “must do
more than yield a predictable result”; combining elements that
work together “in an unexpected and fruitful manner” would
not have been obvious).
PharmaStem Therapeutics Inc. v. Viacell Inc., 491 F.3d 1342, 1360, 83
USPQ2d 1289, 1301-02 (Fed. Cir. 2007).

ANALYSIS
Independent claims 1 and 15
We consider first the Examiner’s rejection of independent claims 1
and 15 as being unpatentable over the teachings of Bonomi in view of
Pallakoff. Since Appellants’ arguments have treated these claims as a single
group which stands or falls together, we will select independent claim 1 as
the representative claim because we find it is the broader of the two claims
in this group. See 37 C.F.R. § 41.37(c)(1)(vii)(2004).
Appellants contend the primary Bonomi reference does not teach a
subscriber group having at least two (i.e., a plurality of) subscribers wherein
each subscriber belonging to the subscriber group maintains an independent
account. Appellants argue that the portion of Bonomi cited by the Examiner
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(i.e., Figs. 7A and 8C and column 24, lines 56-57) merely depicts
administration users and does not refer to subscribers (Br. 12).
Appellants further contend the secondary Pallakoff reference does not
teach determining a first price for the purchase order if the program has been
purchased by a threshold number of subscribers belonging to the subscriber
group, and determining a second price, higher than the first price, if the
program has not been purchased by the threshold number of subscribers
belonging to the subscriber group, as required by the language of claim 1
and the equivalent language of claim 15 (Br. 10-11). Specifically,
Appellants argue that Pallakoff’s pricing scheme is based upon “aggregate
demand,” and not on a threshold number of subscribers (Br. 11).
Appellants acknowledge the Examiner has also suggested that the
“Buying Team” described in Pallakoff at column 10, lines 43-56 is a
“subscriber group” 2 (Br. 11). In response, Appellants assert that Pallakoff’s
customers must actually purchase an item to become a member of the
Buying Team, “thereby affecting the aggregate demand for units sold . . .”
(id.).
The Examiner disagrees. Regarding the teachings of Bonomi, the
Examiner contends that Bonomi’s list of customers is a subscriber group
defined by two or more customers, as shown in Figure 12A under the
heading “CUSTOMER LIST” (Answer 11). In particular, the Examiner
notes that Bonomi expressly discloses a subscriber (named “Li Liu”) who
has an account (i.e., an independent account) with the media system, as

2 See Advisory Action mailed Mar. 23, 2006, p. 2.
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shown in the “Account Information” block on the right side of Figure 12A
(Answer 11).
As further pointed out by the Examiner, Pallakoff’s system notifies
the current buying group members that they should tell their friends and
family about the offer in order to get more buyers to join the buying group
(Answer 9). Specifically, the Examiner points to Pallakoff, at column 10,
lines 43-50, where Pallakoff’s system sends a message stating: “We need 5
more people to join the Buying Team in order to get the Soccer Balls for
only $10 each. Tell your friends!” (Answer 9). Thus, the Examiner finds
Pallakoff teaches the feature of a discounted price (e.g., $10 each) according
to a threshold number of buyers (e.g., the current number of buyers in the
buying team plus five) (Answer 9-10). The Examiner also relies on the
following passage in Pallakoff:
In still other embodiments of this invention, sellers could
specify different types of thresholds. For example, sellers could
offer a special price if enough people agree to purchase exactly
500 units (in aggregate) of a given item (e.g. because the seller
has exactly 500 units to sell). Or they could offer a special price
if potential buyers agree to purchase at least 500 units (in
aggregate) if the deal goes through (e.g. because the seller has
more than 500 units available for sale).
Pallakoff, col. 11, ll. 16-24. (Answer 4, 10.)
The Examiner contends the claims do not require that each subscriber
belonging to the subscriber group may elect to purchase the program
because of the alternative language “or” as used in the claim [e.g., wherein
each subscriber may elect to purchase or not purchase the program or
programming event] (Answer 10).
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In the Reply Brief, Appellants argue that the “price calculations in
Pallakoff are based on aggregate demand, which is not a function of a
number of buyers” (Reply Br. 3). Appellants point to Pallakoff, at column 7,
lines 31-46, where aggregate demand is calculated as the number of balls
purchased by a group of buyers (Reply Br. 3). Appellants further contend
that Pallakoff’s “Buying Team” is not a subscriber group because a buyer in
Pallakoff is different from a “subscriber,” as claimed. Specifically,
Appellants contend that because members of Pallakoff’s “Buying Team”
must (by definition) be purchasers, then it logically follows that Pallakoff’s
members cannot elect to purchase or not purchase, as required by the
language of each independent claim [claims 1, 15, and 22] (Reply Br. 4).
Appellants argue that regardless of whether this language is read in the
alternative or not (e.g., as merely “wherein each subscriber may elect to
purchase . . . ,” the meaning is unchanged, i.e., each subscriber as claimed
has the power to purchase or not purchase (id.).
After carefully considering all of the evidence before us, we begin our
analysis by noting that Bonomi teaches a centrally-managed media delivery
system that delivers program content, such as video-on-demand, to
subscribers (see Bonomi, col. 23, ll. 42-45; see also col. 5, ll. 47-51). We
further note that Bonomi expressly teaches “subscriber accounts” that we
find are “independent,” i.e., one account per customer (col. 2, l. 40; see also
col. 21, l. 67 through col. 22, l. 1). Thus, we agree with the Examiner that
Bonomi teaches a subscriber group consisting of a plurality of subscribers
(see CUSTOMER LIST, Fig. 12A) where each customer has an independent
account (see “Account Information” for “Li Liu” shown at the right of Fig.
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12A). Appellants’ argument that “a mere list of customers is not a
subscriber group because the customers are not identified as being part of an
explicit ‘subscriber group’” (Reply Br. 5) is not understood. It is evident
that the customers identified in this list are subscribers because Bonomi uses
the terms “customer” and “subscriber” interchangeably. See, e.g., col. 19, ll.
14-18 (“[E]ach of the subscriber accounts in the media management system
can be customized by the administrator or the customer (subscriber)
according to a particular service agreement with the customer or preferences
set by the customer.”). Thus, we find Bonomi’s list of customers represents
a group of subscribers.
The Examiner looks to the teachings of Pallakoff for the
determination of a lower price if purchases have been made by a threshold
number of subscribers (i.e., buyers) (Answer 3-4). Appellants contend that
Pallakoff’s pricing scheme is based upon “aggregate demand,” (i.e., demand
for a particular number of units) and not on a threshold number of
subscribers (Br. 11).
We agree with the Examiner that Pallakoff gives examples of basing
the price on a threshold number of buyers. One example is for the seller to
notify Buying Group members that “[w]e need 5 more people to join the
Buying Team in order to get the Soccer Balls for only $10 each” (col. 10, ll.
48-49), in which case the threshold number of buyers equals the current
number of members plus five. Another example is to have sellers “offer a
special price if enough people agree to purchase exactly 500 units (in
aggregate) of a given item (e.g. because the seller has exactly 500 units to
sell)” (col. 11, ll. 17-20). A further example is given in the following
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passage, which describes offering a lower price for each of a threshold
number of buyers to purchase a single amusement park pass:
Another embodiment of the present invention allows
sellers to set both a minimum number of buyers as well as a
minimum volume of goods or services sold, and allows the
seller to set limits on the amount any one buyer could buy for a
given offer. For example, a seller might offer 500 computer
modems, and specify "maximum of two modems per person".
Alternatively a seller might offer 300 passes to an amusement
park, requiring 300 individual buyers (rather than allowing
more than one pass per any given buyer).
(Pallakoff, col. 11, ll. 25-33.) A further example is: “Our law firm will do
incorporation work for 200 companies, at only $1000 per company” (col. 11,
ll. 40-42). Thus, contrary to Appellants’ arguments, we find Pallakoff
discloses that the price can be based upon a threshold number of purchasers.
Regarding Appellants’ argument that Pallakoff’s “Buying Team” is
not a subscriber group (because a “buyer” in Pallakoff is allegedly different
from a “subscriber”), we find the Examiner has relied upon Bonomi for the
teaching of a program-purchasing subscriber group, as claimed. Our
reviewing court has determined that one cannot show nonobviousness by
attacking references individually where the rejections are based on
combinations of references. In re Merck & Co., Inc., 800 F.2d 1091, 1097,
231 USPQ 375, 380 (Fed. Cir. 1986). Here, Pallakoff is relied on to show
that the prior art included a graduated pricing scheme wherein a lower price
is obtained if purchases are made by a threshold number of buyers (see
Answer 3-4). Pallakoff must be read, not in isolation, but for what it fairly
teaches in combination with the prior art as a whole. Our reviewing court
has stated: “[t]he use of patents as references is not limited to what the
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patentees describe as their own inventions or to the problems with which
they are concerned. They are part of the literature of the art, relevant for all
they contain.” In re Heck, 699 F.2d 1331, 1333, 216 USPQ 1038, 1039
(Fed. Cir. 1983) (quoting In re Lemelson, 397 F.2d 1006, 1009, 158 USPQ
275, 277 (CCPA 1968)).
Regarding Appellants’ argument that Pallakoff’s members cannot
elect to purchase or not purchase, as required by the language of each
independent claim (Reply Br. 4), we again note that the Examiner’s rejection
is based upon the combination of the references. Indeed, we find that
Bonomi’s video-on-demand subscribers have the power to purchase or not
purchase video media:
The media storage device 206 facilitates the operations of the
media delivery center by providing storage space to cache or
store the video sources received from the media receiving unit
202. The storage spaces may include a cluster of video servers
or stacks of optical or magnetic storage discs, each being
labeled accordingly and accessible when contents stored therein
are to be delivered.
. . .
The cache area 222 provides a mechanism to buffer the
received live video broadcasts (i.e., live assets) for broadcasting
to subscribers of the video delivery center. The temporary
space 224 provides spaces for the video delivery center to store
data for temporary uses, such as a short-term program guide,
commercial information, latest programs available for video-
on-demand, or any programs that will be deleted after
broadcast. The permanent space 226 is typically used by the
video delivery center to store assets owned by the video
delivery center, the assets may include purchased movies or
other videos available to the subscribers for a fee.
(Bonomi, col. 9, ll. 5-26).
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For at least the aforementioned reasons, we conclude the Examiner’s
proffered combination of Bonomi and Pallakoff teaches and/or suggests all
that is claimed. Therefore, we conclude the Examiner has established a
prima facie case of obviousness that has not been persuasively rebutted by
Appellants by a showing of insufficient evidence of prima facie obviousness
or by rebutting the prima facie case with evidence of secondary indicia of
nonobviousness. Accordingly, the Examiner’s rejection of representative
claim 1 as being unpat`entable over Bonomi in view of Pallakoff is
sustained.
Pursuant to 37 C.F.R. § 41.37(c)(1)(vii), we have decided the appeal
with respect to independent claim 15 in this group on the basis of the
selected claim alone. Therefore, we will sustain the Examiner’s rejection of
independent claim 15 as being unpatentable over Bonomi in view of
Pallakoff for the same reasons discussed supra with respect to representative
claim 1.
Independent claim 22
We consider next the Examiner’s rejection of independent claim 22 as
being unpatentable over the teachings of Bonomi in view of Pallakoff. The
only argument Appellant makes regarding claim 22 is the above-addressed
argument, which we have found unpersuasive, that the references fail to
disclose or suggest the “subscriber group” limitations. Accordingly, the
Examiner’s rejection of independent claim 22 as being unpatentable over
Bonomi in view of Pallakoff is sustained.
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Dependent claims 2-4, 6-14, 16-21, and 23-31
Appellants have not presented any substantive arguments directed to
the separate patentability of dependent claims 2-4, 6-14, 16-21, and 23-31.
In the absence of a separate argument with respect to the dependent claims,
those claims stand or fall with the representative independent claims. See In
re Young, 927 F.2d 588, 590, 18 USPQ2d 1089, 1091 (Fed. Cir. 1991). See
also 37 C.F.R. § 41.37(c)(1)(vii)(2005). Therefore, we will sustain the
Examiner’s rejection of these claims for the same reasons discussed supra
with respect to independent claims 1, 15, and 22.

DECISION
Based on the findings of facts and analysis above, we conclude that
the Examiner did not err in rejecting claims 1-4 and 6-31 under 35 U.S.C.
§ 103(a) for obviousness based on Bonomi in view of Pallakoff. Therefore,
the decision of the Examiner rejecting claims 1-4 and 6-31 is affirmed.
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No time period for taking any subsequent action in connection with
this appeal may be extended under 37 C.F.R. § 1.136(a)(1)(iv).

AFFIRMED

pgc

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