Ex Parte Cairns

Patent Trial and Appeal Board

Jul 18, 2017

13589343 (P.T.A.B. Jul. 18, 2017)

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.
90/012,264 04/24/2012 6,173,267 B1 14500.1001 REX 7509
25099 7590 07/18/2017
DAVID M. QUINLAN, P.C.
P.O. Box 8088
22 Monterey Drive
PRINCETON, NJ 08543
EXAMINER
WORJLOH, JALATEE
ART UNIT PAPER NUMBER
3992
MAIL DATE DELIVERY MODE
07/18/2017 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
____________

Ex parte CAIRNS HOLDINGS LLC,
Patent Owner
____________

Appeal 2017-007763
Reexamination Control 90/012,264 and Reissue Application No.
13/589,3431
Patent 6,173,267 B1
Technology Center 3900
____________

Before JOHN A. JEFFERY, STEPHEN C. SIU, and ERIC B. CHEN,
Administrative Patent Judges.

SIU, Administrative Patent Judge.

DECISION ON APPEAL
This proceeding arose out of a request for ex parte reexamination and
reissue examination of U.S. Patent No. 6,173,267 B1 (“the ’267 patent”) to
Laurie Cairns, entitled METHOD FOR PRODUCT PROMOTION, issued January 9,
2001.

1 Reexamination No. 90/012,264 and Reissue No. 13/589,343 were merged.
See Decision Merging Reissue and Reexamination Proceedings, dated
January 10, 2013.
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Patent Owner appeals under 35 U.S.C. §§ 134 and 306 from the
Examiner’s Final Rejection of claims 1–20, 22, 23, 25–27, and 29–36. App.
Br. 1, 5.2 We have jurisdiction under 35 U.S.C. § 6(b).
The disclosed invention relates generally to promoting a product by
fulfillment of a promotional contest. See Spec. 1:5–9.
Claim 22 reads as follows:
22. A method for product promotion, comprising the
steps of:
providing to a purchaser a product or service for sale at a
location including a building where payment is received for
said product or service;
providing a unique code accompanying said product or
service for sale by modification of said product or service,
modification of packaging of said product or service, or
incorporation of a card or piece into said product or service;
providing an electronic address for verifying said unique
codes input from a location other than the building where
payment was received; and
providing a sweepstakes promotion involving the award
of prizes to selected purchasers of said product or service who
input a verified unique code at said electronic address including
informing every said purchaser who inputs a said verified
unique code of a status of said sweepstakes promotion while
said purchaser is connected at said electronic address to input a
said unique code,
wherein a prize is forwarded from a first location other
than the building where payment was received directly to least
one of said purchasers who has won a prize and who is located
at a second location different from the first location.

2 Appeal Brief, filed January 21, 2016 (“App. Br.”).
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Patent Owner appeals the Examiner’s rejection of claims 1–20, 22, 23,
25–27, and 29–36 under 35 U.S.C. § 101 as being directed to non-statutory
subject matter; claims 1–20, 23, 25–27, and 30–36 under 35 U.S.C. § 103(a)
as unpatentable over US Patent 5,883,620 (“Hobbs”), US Patent 6,039,244
(“Finsterwald”), and US Patent 4,669,730 (“Small”); and claim 29 under 35
U.S.C. § 103(a) as unpatentable over Hobbs, Finsterwald, Small, and
Official Notice.3

ISSUE

Did the Examiner err in rejecting claims 1–20, 22, 23, 25–27, and 29–
36?

ANALYSIS

35 U.S.C. § 101
Claim 22 recites a method comprising providing a product/service, a
code, an electronic address, a sweepstakes promotion, and a prize. The
Examiner finds that claim 22 is unpatentable as being directed to non-
statutory subject matter under 35 U.S.C. § 101. Final Act. 2–4; see also

3 Patent Owner provides arguments in support of only claim 22 and states
that “[f]or purposes of this appeal all claims will stand or fall with
independent claim 22.” App. Br. 1.
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Ans. 2–6. We agree with the Examiner for at least the reasons set forth by
the Examiner.
For example, following the “framework for distinguishing patents that
claim . . . abstract ideas from those that claim patent-eligible applications of
those concepts” as set forth by the U.S. Supreme Court in Alice Corp. Pty.
Ltd. v. CLS Bank Int’l, 134 S. Ct. 2347 (2014), we first “determine whether
the claims at issue are directed to [a] patent-ineligible concept[]” and, “[i]f
so, we then ask, ‘[w]hat else is there in the claims before us?’” in order “to
determine whether the additional elements ‘transform the nature of the
claim’ into a patent-eligible application.” Alice, 134 S. Ct. at 2355 (internal
citation omitted).
In Alice, claims were directed to a “computer-implemented scheme
for mitigating ‘settlement risk’ . . . by using a third-party intermediary”
including creating “records (i.e., account ledgers),” “updat[ing] the . . .
records,” “allowing ‘only those transactions for which . . . updated . . .
records indicate sufficient resources . . . [’],” and “instruct[ing] the relevant
financial institutions to carry out the ‘permitted’ transactions in accordance
with the updated . . . records.” Alice, 134 S. Ct. at 2351– 2353 (internal
citation omitted). The Court held that such claims “are drawn to [an]
abstract idea” based on similarities between the claimed “intermediated
settlement” and claims in other matters previously held to be unpatentable as
“abstract ideas.” Alice, 134 S. Ct. at 2355–2356 (concluding that “[i]t
follows from our prior cases, and Bilski in particular, that the claims at issue
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here are directed to an abstract idea”).4 In particular, the Court noted
sufficient similarity of the “intermediated settlement” claims in Alice to
claim features previously determined to be “abstract ideas” of “an algorithm
for converting binary-coded decimal numerals into pure binary form” (Alice,
134 S. Ct. at 2355 (citing Gottschalk v. Benson, 409 U.S. at 67, 71–72)), a
method for “adjust[ing] alarm limits for certain operating conditions” (Alice,
134 S. Ct. at 2358 (citing Parker v. Flook, 437 U.S. 584, 585–86 (1978)), or
a “method for hedging against the financial risk of price fluctuations”
including “initiating” transactions, “identifying market participants” and
“initiating a series of [other] transactions . . . to balance the risk.” Alice, 134
S. Ct. at 2355–56 (citing Bilski v. Kappos, 561 U.S. 593, 599 (2010)).
Hence, based on this guidance, a claim directed to any of converting,
adjusting, creating, initiating, or updating data (and any similar such actions
on data) constitute an “abstract idea” and, therefore, is to be held to be non-
statutory subject matter under 35 U.S.C. § 101. Claim 22 in the present
matter recites providing various forms of data – e.g., a “product or service,”
a “unique code,” “an electronic address,” and “a sweepstakes promotion.”
We agree with the Examiner that the claimed “providing” of data is
sufficiently similar to at least one of mitigating, creating, updating (Alice),
converting (Benson), adjusting (Flook), hedging, initiating, and/or

4 With respect to this issue, the Court cited Gottschalk v. Benson, 409 U.S.
63 (1972); Parker v. Flook, 437 U.S. 584 (1978); and Bilski v. Kappos, 561
U.S. 593 (2010).
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identifying data (Bilski), each of which the Court informs is to constitute an
“abstract idea” that is unpatentable under 35 U.S.C. § 101.
Subsequent to the decision of the Supreme Court in Alice, the Federal
Circuit further instructs that claims reciting various other claim terms
pertaining to the manipulation of data constitute “abstract ideas” and are to
be considered unpatentable under 35 U.S.C. § 101. These include claims
directed to “collecting, displaying, and manipulating data,” “recognizing
certain data within [a] set,” “storing . . . data in a memory,” “extracting data
. . . , entering the data into . . . fields,” “customizing information,”
“presenting [data] to users,” as well as claims that “recit[e] similar data
manipulation steps,” even if the claims in question “limit[] the invention to a
technological environment”;5 claims drawn to “collect[ing], classify[ing], or
otherwise filter[ing] data,” and the “creation of [data] used to search and
retrieve information” even if the claims in question recite specific types of
data;6 claims drawn to generating and transmitting data, even if such data
includes categories and items or if the data is stored on a data storage device,
or claims drawn to other actions deemed to be “commonly known”;7 claims
drawn to “receiving [data], characterizing [the data] based on [other data], . .
. communicating the [data]” or “filtering” data, or any other action deemed

5 Intellectual Ventures I LLC v. Capital One Financial Corp., 850 F.3d
1332, 1339–40 (Fed. Cir. 2017).
6 Intellectual Ventures I LLC v. Erie Indemnity Co., 850 F.3d 1315, 1327
(Fed. Cir 2017).
7 Apple, Inc. v. Ameranth, Inc., 842 F.3d 1229, 1240–42 (Fed. Cir. 2016).
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to “not ‘improve the functioning of the computer itself’” or constitute
“generic computers to perform generic computer functions”;8 claims drawn
to “classifying [data] and storing the [data] based on its classification,” or
any actions that do not contribute to the “improvement [of] the functioning
of a computer” and “simply add[] conventional computer components to
well-known business practices”;9 claims drawn to “retaining information” or
any claim that “contains no restriction on how the result is accomplished”;10
claims drawn to “collecting,” “recognizing,” or “storing” data even if the
claims also “limit[] the abstract idea . . . to a particular technological
environment”;11 claims drawn to “receiving,” selecting,” “offering,”
“restricting access,” “facilitating display,” or “updating” data, as well as
“using [data] as an exchange or currency”;12 claims drawn to “receiving”
and/or “processing” data and “creating” a “contractual relationship”;13 and

8 Intellectual Ventures I LLC v. Symantec Corp., 838 F.3d 1307, 1313, 1315
(Fed. Cir. 2016) (internal citations omitted).
9 In re TLI Commc’ns LLC Patent Litig., 823 F.3d 607, 612 (Fed. Cir. 2016).
10 The court also considered “retaining information” to constitute “well-
understood, routine, conventional activities previously known.” Internet
Patents Corp. v. Active Network, Inc., 790 F.3d 1343, 1348 (Fed. Cir. 2015)
(internal quotation and citation omitted).
11 Content Extraction and Transmission LLC v. Wells Fargo Bank, Nat’l
Assoc., 776 F.3d 1343, 1347, 1348 (Fed. Cir. 2014).
12 Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 714–16 (Fed. Cir. 2014)
13 buySAFE, Inc. v. Google, Inc., 765 F.3d 1350, 1354–55 (Fed. Cir. 2014).
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claims drawn to “generating” data and/or “combining” data are to be deemed
“so abstract and sweeping” as to be “not patent eligible under section 101.”14
In summary, the Federal Circuit instructs us that claims are to be
deemed ineligible as directed to “abstract ideas” under 35 U.S.C. § 101 if the
claims recite no more than manipulating data that may include any of
classifying, collecting, combining, communicating, creating, customizing,
displaying, extracting, facilitating display of, filtering, generating,
manipulating, offering, presenting, processing, receiving, recognizing,
restricting access to, retaining, retrieving, searching, selecting, storing,
transmitting, updating, or using as an exchange or currency (or any other
similar action taken with respect to data).
In the present matter, as previously discussed, claim 22 is directed to a
method comprising “providing” various types of data. We agree with the
Examiner that “providing” data, according to our reviewing court(s), is to be
considered to be unpatentable under 35 U.S.C. § 101 as an “abstract idea.”
For example, “providing” data is sufficiently similar to at least any of
“presenting,” “offering,” “communicating,” “displaying,” “facilitating
display of,” or “transmitting” data, each action of which has been held by
our reviewing court(s) to constitute an “abstract idea” for purposes of 35
U.S.C. § 101 (see previous discussion). Therefore, we agree with the
Examiner, in accordance with guidance from our reviewing courts, that the

14 Digitech Image Tech, LLC v. Electronics for Imaging, Inc., 758 F.3d
1344, 1351 (2014) (internal quotation and citation omitted).
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claims in the present matter recite an “abstract idea” in the context of 35
U.S.C. § 101 and are, therefore, ineligible as being directed to non-statutory
subject matter.
The Supreme Court in Alice further cautions that we must “tread
carefully in construing this exclusionary principle lest it swallow all of
patent law” because “[a]t some level, ‘all inventions . . . embody, use,
reflect, rest upon, or apply . . . abstract ideas.’” Alice, 134 S. Ct. at 2354
(citing Mayo Collaborative Svcs. v. Prometheus Labs, Inc., 132 S. Ct. 1289,
1293–94). In order to prevent “swallow[ing] all of patent law,” we must
“distinguish between patents that claim the ‘buildin[g] block[s]’ of human
ingenuity and those that integrate the building blocks into something more
. . . thereby ‘transform[ing]’ them into a patent-eligible invention.” Alice,
134 S. Ct. at 2354 (internal citation omitted).
In this regard, the Supreme Court in Alice informs us that a claimed
invention that is deemed to constitute an “abstract idea” may be determined
to be patent eligible if that “abstract idea” is “used . . . in a process designed
to solve a technological problem in ‘conventional industry practice’” and
“improve[s] an existing technological process.” Alice, 134 S. Ct. at 2358
(citing Diamond v. Diehr, 450 U.S. 175 (1981)). The Supreme Court further
informs us that “the mere recitation of a generic computer cannot transform
a patent-ineligible abstract idea into a patent-eligible invention.” Alice, 134
S. Ct. at 2358.
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In the present matter, as previously discussed, the claims are directed
to a method that is performed by a computer, the method comprising
“providing” various types of data by a computer. In other words, the claims
merely recite a generic computer for performing the “abstract idea” of
providing data. Because the Supreme Court has held that recitation of a
generic computer is insufficient to transform a claimed invention deemed to
be directed to an “abstract idea” into a patent-eligible invention, we must
conclude that the claimed invention in the present matter is unpatentable
under 35 U.S.C. § 101 as an “abstract idea” and execution of the “abstract
idea” using a generic computer is insufficient to transform the “abstract
idea” into a patent-eligible invention under 35 U.S.C. § 101.
Patent Owner argues that “claim 22 is not directed to an abstract idea”
because “merely referring in a claim to something that could be called an
‘abstract idea’ is [not] enough to satisfy Alice part one.” App. Br. 7. We are
not persuaded by Patent Owner’s arguments for at least the previously
discussed reasons, which are not based solely on “merely referring in a claim
to something that could be called an ‘abstract idea’”.
Patent Owner argues that claim 22 “is not directed to an abstract idea”
because “[u]nder the precedents . . . neither the use of the word
‘sweepstakes’ in claim 22, nor the fact that the claim refers to aspects of a
sweepstakes contest to which the claimed method is applied, renders the
claim ‘directed to an abstract idea’”. App. Br. 8. We are not persuaded by
Patent Owner’s arguments at least because, as previously discussed, our
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affirmance of the Examiner’s rejection of claim 22 under 35 U.S.C. § 101 is
not based solely on “the use of the word ‘sweepstakes’ in claim 22” or “the
fact that the claim refers to aspects of a sweepstakes contest.”
Patent Owner argues that claim 22 “is not directed to an abstract idea”
because “not all methods of organizing human activity are abstract ideas.”
App. Br. 8. We are not persuaded by Patent Owner’s argument at least
because, as previously discussed, our reviewing court has held that specific
actions performed on data are to be deemed an “abstract idea,” at least one
of the specifically identified actions being similar to the claimed “providing”
of data. Patent Owner does not explain sufficiently the difference between
the claimed “providing” of data and any of the similar actions performed on
data held by our reviewing court(s) to constitute an “abstract idea” for
purposes of 35 U.S.C. § 101.
Patent Owner argues that claim 22 “is not directed to an abstract idea”
because claim 22 “passes the test when compared to . . . DDR Holdings,
LLC v. Hotels.Com, L.P., 773 F.3d 1245 (Fed. Cir. 2014) . . . [and] Research
Corp. Techs. v. Microsoft Corp., 627 F.3d 859 (Fed. Cir. 2010).” App. Br.
9. We are not persuaded by Patent Owner’s argument at least because, other
than merely citing generalized conclusory statements from each of these
cited cases, Patent Owner does not explain how either of these cases pertain
to the claimed invention in the ’267 patent, much less that claim 22 of the
’267 patent somehow recites statutory subject matter under 35 U.S.C. § 101
under either Alice or any of the other cited precedential cases from our
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reviewing courts, including any of DDR Holdings and/or Research Corp.
Techs (see above discussion).
Patent Owner argues that claim 22 “is not directed to an abstract idea”
because claim 22 “includes substantially more than a sweepstakes contest.”
App. Br. 10. In particular, Patent Owner argues that claim 22 “tak[es]
advantage of modern technology . . . [and] overcomes problems with
implementing a sweepstakes contest specifically arising in that context” such
as “[c]laim 22’s requirement that ‘a prize is forwarded from a first location
other than the building where payment was received directly to at least one
of said purchasers who has won a prize and who is located at a second
location different from the first location.’” App. Br. 11. Hence, Patent
Owner argues that claim 22 is not directed merely to an “abstract idea” of
providing data because claim 22 also recites that data (i.e., “payment”) is
provided to one location, that other data (i.e., “a prize”) is “provid[ed]” from
a second location that differs from the location where payment “data” was
received, and that data (i.e., a “prize”) is provided to a recipient that is
located at a location other than where the data was originally located.15 Id.
In the absence of specific guidance from our reviewing courts, we are
not persuaded by Patent Owner’s argument that the mere provision of one

15 Patent Owner argues that the Examiner provides “a new construction of
‘prize’” and newly relies on “the wherein clause [as] not being a limitation
on the claimed method” in the Examiner’s Answer. Reply Br. 6. Patent
Owner does not indicate that a petition pertaining to these allegations was
filed. In any event, we do not decide petitionable matters on appeal.
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form of data to a first location, and provision of another form of data from a
second location (different from the first location) to a recipient located at a
location that differs from the second location is sufficient to be considered
“substantially more” so as to remove the so-called “abstract idea” of
“providing data” from the realm of non-statutory subject matter under 35
U.S.C. § 101 as predicated by our reviewing courts (e.g., Alice). Patent
Owner does not provide sufficient facts or cite to specific guidance from our
reviewing courts to demonstrate persuasively that “providing” data (that is
considered by our reviewing courts to be unpatentable under 35 U.S.C.
§ 101 as an “abstract idea”) is somehow patentable under 35 U.S.C. § 101
based on the relative location from which the data is “provided” and/or the
relative location to which the data is provided. In the absence of such
guidance from our reviewing court, we must conclude that the so-called
“abstract idea” of providing data is not transformed into patent-eligible
subject matter under 35 U.S.C. § 101 based merely on the relative
location(s) from/to which the data is provided.
Patent Owner does not provide additional arguments in support of the
eligibility of claims 1–20, 23, 25–27, and 29–36. Based on guidance from
our reviewing court(s) and the evidence of record, the Examiner did not err
in rejecting claims 1–20, 22, 23, 25–27, and 29–36 under 35 U.S.C. § 101.

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35 U.S.C. § 103
Claim 22 recites a location including a building where payment is
received for said product or service and that a prize is forwarded from a first
location other than the building where payment was received directly to at
least one of said purchasers who has won a prize and who is located at a
second location different from the first location. The Examiner finds that
Hobbs discloses “providing to a purchaser a product or service for sale at a
location including a building where payment is received from said product
or service.” Final Act. 6 (citing Hobbs 7:28-46). As the Examiner explains,
Hobbs discloses an example in which a “cup is purchased” by a “consumer.”
Hobbs 7:45. The purchased product includes “a code printed thereon which
is entered into” an apparatus to verify if the purchaser has won a prize.
Hobbs 7:28-30. “In the event that a winning code is entered, the consumer
can receive the indicated prize by presenting the winning consumer product
at an appropriate location, preferably co-located with the electronic
verification system.” Hobbs 9:37–39. The code number is “verified” at a
“prize distribution location where the prize award is verified and the prize
awarded to the consumer.” Hobbs 10:8–9.
The Examiner also explains that Small discloses that a “prize may be
provided to the purchaser . . . from a location other than the building where
payment was received . . . [in which] a . . . purchaser may receive . . .
information . . . while conducting a transaction at an automatic teller
machine . . .” Final Act. 10–11 (citing Small 8:34–43). As the Examiner
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indicates, Small discloses a user at a “remote computer terminal such as an
automated teller machine (ATM) . . . [that is] in electronic communication
with the subject financial institution . . . computer.” Small 5:29–34. “[I]f a
winning correlation exists [between a “user indicia” and a “game indicia”], a
“processor . . . determines a prize . . . to be awarded a user as well as a
manner of awarding the prize to the user.” Small 5:43–4, 49–52. “In the
event the prize is a material good or service, . . . the user [is instructed] to go
to his or her financial institution to receive the prize.” 8:37–40. In other
words, Small discloses a user performing a financial transaction at one
location (i.e., at an ATM) and, based on the financial transaction at the one
location, receiving a “prize” at a different location (i.e., at a “financial
institution”). Hence, Small demonstrates that one of ordinary skill in the art
would have known the practice of performing an action at one location and
receiving a resulting prize from a different location.
The Examiner also explains that “it would have been obvious to one
having ordinary skill in the art . . . to direct the winning purchaser [of
Hobbs] . . . to a location other than the building where the payment was
received [of Small] . . . [such as] other retailers who carry these items.”
Final Act. 11, see also Final Act. 12. In other words, the Examiner
concludes that it would have been obvious to one of ordinary skill in the art
to direct a recipient of an item to a location at which the item is located. We
agree with the Examiner that one of skill in the art, having ordinary
creativity and not being an automaton, would have understood the generally
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known practice of receiving an item at a location where the item is located,
and the individual receiving the item potentially relocating to the location
where the item is located if the individual receiving the item is not currently
located at the location where the item is located. For example, one of skill in
the art would have understood that, if an individual is to receive an item but
is situated at a location remote from the item, a finite number of options
would be available to the individual – i.e., either the individual relocates to
the location at which the item is located or the item is relocated to the
location at which the individual is located. Choosing between this finite
number of predictable choices (i.e., 2 known choices) would have been well
within the purview of one of ordinary skill in the art at least because, as
previously discussed, one of ordinary skill in the art possesses ordinary
creativity and is not an automaton.
In any event, as previously discussed, we note that Hobbs discloses a
user purchasing a product (e.g., a cup) with a code and checking the code to
determine if the code is a “winning code . . . by presenting the winning
consumer product at an appropriate location, preferably co-located with the
electronic verification system.” Hobbs 9:37–40. While Hobbs discloses that
the location where payment is made for the product is “preferably co-
located” with an “electronic verification system,” Hobbs does not disclose
that this is required. Rather Hobbs not only discloses this feature merely to
be “preferable,” but also discloses that “the invention may be practiced
otherwise than as specifically described herein without departing from the
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spirit and scope of the invention.” Hobbs 10:36–38. One of skill in the art
would have understood that if co-location of payment and code verification
is merely “preferable” but not “required,” as disclosed by Hobbs, payment
and code verification not being co-located would be another option (albeit
not “preferable”) “without departing from the spirit and scope of the [Hobbs]
invention.”
In addition, Hobbs explicitly discloses another location (i.e., the
“prize distribution location”) “where the prize award is verified and the prize
awarded to the consumer.” Hobbs 10:8–9. Hence, in Hobbs, the product is
purchased (and paid for) at one location and the code is “verified” and the
prize is distributed from a different location (i.e., the “prize distribution
location”).
Patent Owner argues that “nothing in Hobbs suggests that a code
would be placed on any product not meant to be consumed right at the
store,” that Hobbs discloses “that the prize verification apparatus 1 is at the
store where the cup was purchased,” which, according to Patent Owner, is
“only at locations ‘where consumer products are distributed,’” but fails to
disclose “that its prize verification apparatus can be located elsewhere.”
App. Br. 16–17, 21. As discussed above, we disagree with Patent Owner’s
characterization of Hobbs because Hobbs discloses that the location where
payment is received is merely “preferably co-located with the electronic
verification system” but does not disclose that co-location is required.
Given the plain and customary meaning of the term “preferably,” one of skill
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in the art would not have understood such co-location to be required. Also
as previously discussed, Hobbs discloses an embodiment in which the
product is purchased (and paid for) at one location and the code is “verified”
and the prize is distributed from a different location.
In any event, the Examiner relies on the combination of Hobbs,
Finsterwald, and Small, rather than Hobbs in isolation, for the disputed
claim feature. Hence, we are not persuaded by Patent Owner’s arguments,
even assuming Hobbs fails to disclose this claim feature.
Patent Owner argues that the combination of Hobbs, Finsterwald, and
Small fails to disclose or suggest this claim feature because, according to
Patent Owner, Hobbs is “limited to . . . a promotion in which the codes
accompanying the products are input from the same location as the building
where payment was received,” that the Examiner’s prima facie showing of
obviousness over the combination of Hobbs with Finsterwald is “muddled,”
and that “[t]here is simply no suggestion [in Small] that its promotion
involves prizes that by their nature would have to be delivered to a prize
winner.” App. Br. 20–23. For at least the reasons previously discussed, we
are not persuaded by Patent Owner’s arguments.
Patent Owner argues that it would not have been obvious to one of
ordinary skill in the art to have combined the cited references because,
according to Patent Owner, “over 200 licenses under the ’267 patent have
been granted,” “licensing revenue . . . is well in excess of $1,000,000,” and
“the promotions for which licenses under the patent were taken included all
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of the steps of the method of claim 22.” App. Br. 27 (citing “Second
Declaration of Laurie Cairns,” dated February 12, 2014, “Second Cairns
Decl.,” ¶¶ 2–6 and “Third Declaration of Laurie Cairns,” dated March 13,
2015, “Third Cairns Decl.,” ¶¶ 4–6). Patent Owner also asserts that “[w]hen
the proponent has established a prima facie case of nexus, ‘the burden of
coming forward with evidence in rebuttal shifts to the challenger, as in any
civil litigation.’” App. Br. 28 (citing Demaco Corp. v. F. Von Langsdorff
Licensing, Ltd., 851 F.2d 1387, 1393 (Fed. Cir 1988)).
Even assuming Patent Owner’s contention to be correct that “[w]hen
the proponent [i.e., Patent Owner] has established a prima facie case of
nexus, ‘the burden of . . . rebuttal shifts to the challenger [i.e., Examiner],”
we are not persuaded by Patent Owner’s argument at least because Patent
Owner (or the “proponent”) in this matter has failed to persuasively establish
“a prima facie case of nexus.” Therefore, in accordance with Patent
Owner’s assertion, when the “proponent” fails to establish “a prima facie
case of nexus,” the “burden of rebuttal” does not “shift[] to the challenger,”
as in the present matter.
As an initial matter, Patent Owner’s expert (Laurie Cairns) testifies “I
do not have records on all of the . . . licenses . . . and therefore I have not
been able to make a detailed review of the technology . . .,” but,
nevertheless, proceeds to state a series of “belief[s]” of various aspects of the
licenses and technology. Second Cairns Dec. ¶¶ 4–6. Patent Owner’s expert
does not explain sufficiently how such “belief[s]” were acquired in view of
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the failure to review the relevant records that, according to Patent Owner’s
expert, are not even in possession of Patent Owner’s expert. In addition,
Patent Owner’s expert states various “belief[s],” but fails to assert or to
provide sufficient evidence to support the implication that the stated
“belief[s]” are statements of actual facts. In view of the lack of
substantiating records or review of such (missing) records, the lack of
testimony or explanation as to how resulting conclusions or “belief[s]” were
obtained when records were not available for review, and the lack of
testimony, assertions, or evidence to support that such “belief[s]” are
statements of actual facts, Patent Owner’s expert’s testimony constitute mere
conjecture without evidentiary support and, therefore, has little probative
value.
Patent Owner’s expert also testifies that there is a “belief” that “all of
the sweepstakes promotions for which these licenses were granted involved
the sale of a product or service to a purchaser, and that the product or service
was accompanied by a unique code.” Second Cairns Decl. ¶ 5. Patent
Owner’s expert does not explain sufficiently how this statement of a
“belief,” even if assumed to be true, demonstrates a nexus between the
alleged licenses and the claimed invention. For example, Patent Owner’s
expert merely alleges a personal “belief,” but does not testify that sales of a
product that is accompanied by a code constitutes the required nexus
between the alleged licenses and the claimed invention. Nor does Patent
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Owner testify that any of the alleged licenses were the result of the stated
feature.
To the extent that Patent Owner’s expert relies on selling of a product
accompanied by a code as the required nexus between the alleged licenses
and the claimed invention, we are still not persuaded by Patent Owner’s
expert’s testimony at least because Patent Owner’s expert fails to
demonstrate sufficiently that any of the alleged licenses were the result of
the claimed feature of selling a product that is accompanied by a code.
Indeed, as previously discussed, Hobbs discloses the sale of a product with
an accompanying code (e.g., “a code printed on a consumer product” –
Hobbs 6:6). Given that Hobbs discloses that this feature of selling a product
accompanied by a code was known and practiced in the art, Patent Owner
does not demonstrate sufficiently that one of skill in the art or any of the
alleged licensees would have taken out a license on a product based on a
feature that was known and practiced in the art. Patent Owner does not
explain persuasively why one of skill in the art (or licensee) would have
taken out a license on a claimed method because the claimed method
performs the known step of selling a product that is accompanied by a code.
On the contrary, given that selling a product with an accompanying code
was a known practice, one of skill in the art would have not taken out a
license on such a claimed process, the claimed process already being
performed by those of skill in the art who have not taken out licenses (e.g.,
Hobbs). When secondary considerations “stem[] from what was known in
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the prior art so that there can be no nexus. Tokai Corp. v. Easton Enters.,
Inc., 632 F.3d 1358, 1369 (Fed. Cir. 2011).
Patent Owner’s expert further testifies that “it is my recollection that
the licenses of all of the sweepstakes promotions provided an electronic
address for verifying the contest codes from a location other than the
building where payment was received.” Second Cairns Decl. 5. Here, as
before, Patent Owner’s expert merely testifies to a potential “recollection”
(or “belief”), without the benefit of review of relevant (missing) “records,”
as opposed to testimony of actual fact supported by evidence. Therefore,
Patent Owner’s expert’s testimony lacks sufficient reliability and has little
probative value.
Even assuming that Patent Owner’s expert’s recollection that
licensees verified codes from a location other than the building where
payment was received is accurate (despite the absence of evidence to suggest
any accuracy) and assuming that Patent Owner’s expert is implying that this
step in the process constitutes the required “nexus” between the licenses and
the claimed invention (Patent Owner’s expert does not provide this
testimony, however), we are still not persuaded by Patent Owner’s expert’s
(presumed) testimony to conclude that any alleged licenses were obtained as
a result of a claim feature that pertains to “verifying the contest codes from a
location other than the building where payment was received.”
As discussed above, Hobbs discloses that an individual purchases a
product with an accompanying code at one location (e.g., purchases a cup
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with a code) but that “the prize award is verified” at another location (i.e., a
“prize distribution location” – Hobbs 10:8–9). Hence, Hobbs demonstrates
that one of skill in the art would have known and would have practiced the
step of verifying a code at a location that is different from the location where
payment for the accompanying product is made/received. Patent Owner’s
expert merely implies (but does not explicitly state) that the alleged licensees
took out licenses based on the step of verifying a code from a location other
than the building where payment was received but fails to explain
sufficiently why any licensee would have taken out (and paid for) a license
on a method that performs a step that those of ordinary skill in the art who
had not taken out licenses (e.g., Hobbs) were already practicing. Nor would
it have made logical sense for one of skill in the art (or licensee) to do so.
Thus, it is far more likely that any alleged licensee would have taken out
licenses for reasons other than those implied by Patent Owner’s expert (e.g.,
expediency). When secondary considerations “stem[] from what was known
in the prior art so that there can be no nexus. Tokai, 632 F.3d at 1369.
In summary, while Patent Owner’s expert implies that specific claim
limitations might serve as the required “nexus” between the alleged licenses
and the claimed invention, as discussed above, we are not persuaded at least
because 1) Patent Owner’s expert’s testimony constitute mere “belief[s]” but
are not sufficiently demonstrated or alleged to state actual facts, 2) Patent
Owner’s expert admits to failure to review relevant documents (that are
allegedly missing) pertaining to the claimed invention and alleged licenses
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thus casting doubt on the accuracy of any of Patent Owner’s expert’s
“belief[s]” regarding the reason licensees took out licenses in the first place,
and 3) it would be illogical for one of skill in the art (or any licensee) to take
out (and pay for) a license based on claimed steps of a method (presumably
relied upon by Patent Owner’s expert) that are already performed by those of
skill in the art who have not taken out licenses on the (known) claimed steps.
When alleged secondary considerations “stem[] from what was known in the
prior art . . . there can be no nexus.” Tokai, 632 F.3d at1369.
Patent Owner’s expert further testifies to a personal “recollection” of
various features “that the claim does not require.” Second Cairns Decl. ¶ 5.
We need not consider Patent Owner’s expert’s “recollections” pertaining to
these non-claimed features, even assuming Patent Owner’s expert’s
“recollections” to be accurate, because non-claimed features cannot
constitute a “nexus” between any alleged licenses and the claimed invention,
the features not being claimed in the first place.
Patent Owner does not provide additional arguments in support of
claims 1–20, 23, 25–27, and 29–36 or additional arguments pertaining to
Official Notice. The Examiner did not err in rejecting claims 1–20, 22, 23,
25–27, and 30–36 as obvious over Hobbs, Finsterwald, and Small or claim
29 as obvious over Hobbs, Finsterwald, Small, and Official Notice.

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SUMMARY
We affirm the Examiner’s rejections of claims 1–20, 22, 23, 25–27,
and 29–36 under 35 U.S.C. § 101 and claims 1–20, 22, 23, 25–27, and 29–
36 under 35 U.S.C. § 103.

AFFIRMED

PATENT OWNER:
DAVID M. QUINLAN, P.C.
P.O. BOX 8088
22 MONTEREY DRIVE
PRINCETON, NJ 08543

THIRD PARTY REQUESTER:

LOEB & LOEB, LLP
321 NORTH CLARK
SUITE 2300
CHICAGO, IL 60654-4746

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