Ex Parte Merriman et al

Board of Patent Appeals and Interferences

May 20, 2010

09577798 (B.P.A.I. May. 20, 2010)

UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE BOARD OF PATENT APPEALS
AND INTERFERENCES
____________

Ex parte DWIGHT ALLEN MERRIMAN and
KEVIN JOSEPH O’CONNOR
____________

Appeal 2009-005869
Application 09/577,798
Patent 5,948,061
Technology Center 3700
____________

Decided: May 20, 2010
____________

Before LINDA E. HORNER, WILLIAM F. PATE III, and
JENNIFER D. BAHR, Administrative Patent Judges.

HORNER, Administrative Patent Judge.

DECISION ON APPEAL
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

2
STATEMENT OF THE CASE
Dwight Allen Merriman and Kevin Joseph O’Connor (Appellants)
seek our review under 35 U.S.C. § 134 of the Examiner’s final decision
rejecting claims 1-57 in reissue application 09/577,798. This application
seeks to reissue U.S. Patent 5,948,061, issued September 7, 1999, based on
Application 08/738,634, filed October 29, 1996. We have jurisdiction under
35 U.S.C. § 6(b).
SUMMARY OF DECISION
We AFFIRM-IN-PART.
THE INVENTION
Appellants’ claimed invention is directed to a network and methods of
targeted delivery of advertisements. ‘061 patent, col. 1, ll. 8-11. Claims 1
and 51, reproduced below, are representative of the subject matter on appeal.
1. A network supporting the hypertext transfer protocol,
comprising:
a user node having a browser program coupled to said
network, said user node providing requests for information on said
network;
a content provider affiliate node having a respective affiliate
web site responsive to requests for information from said user
node to provide media content advertising space for display of
advertising content and a link message to said user node;
an advertiser node having an advertiser web site including
advertising content, said advertiser node responsive to a request to
provide said advertising content; and
an advertisement server node storing information about said
user node, said advertisement server node being responsive to a
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

3
request from said user node based on said link message to select
said advertiser node as a selected advertiser node based upon the
information stored about said user node at said advertisement
server node, and identify said advertiser node as said selected
advertiser node to said user node,
whereby said advertising content from said selected
advertiser node is displayed at said user node in response to a
request sent from said user node to said advertiser node to provide
said advertising content.
51. A network comprising:
a user node having a browser program coupled to said
network, said user node providing requests for information on said
network;
a content provider affiliate node having a respective affiliate
web site responsive to requests for information from said user node
to provide media content, advertising space for display of
advertising content and a link message to said user node;
an advertiser node having an advertiser web site including
advertising content, said advertiser node responsive to a request to
provide said advertising content; and
an advertisement server node responsive to a request from
said user node based on said link message to select said advertiser
node as a selected advertiser node, and identify said advertiser
node as said selected advertiser node to said user node,
whereby said advertising content from said selected
advertiser node is displayed at said user node in response to a
request sent from said user node to said advertiser node to provide
said advertising content,
wherein said advertisement server node selects said
advertiser node based on a number of times said advertising
content has been previously displayed at said user node.
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

4
THE EVIDENCE
A listing of the evidence relied upon by the Examiner is provided on
pages 3-4 of the Answer. Appellants’ briefs rely upon the following
additional evidence:
1. Declaration under 37 C.F.R. § 1.132 of Kevin J. O’Connor
(App. Br. 9).
2. Declaration under 37 C.F.R. § 1.132 of Dwight Merriman (App
Br. 15).
3. Expert Report of Christian Knott (App. Br. 18).
4. The American Heritage Dictionary, Second College Edition
(1985) (Reply Br. 4).
Appellants’ Appeal Brief does not appear from the record1 to include
an evidence appendix. See 37 C.F.R. § 41.37(c)(1)(ix) (requiring appeal
briefs to include an appendix containing copies of any evidence entered by
the Examiner and relied upon by appellant in the appeal, along with a
statement setting forth where in the record that evidence was entered in the
record by the examiner, and prohibiting reference in the brief to unentered
evidence). It does not appear that Appellants were sent a Notice of Non-
Compliant Appeal Brief for failure to include an evidence appendix or
provided with an opportunity to correct this defect in their brief. See
37 C.F.R. § 41.37(d). We independently searched the record and located

1 By “record” we refer to the image file wrapper (IFW), which is the
electronic copy of the prosecution history available via the eDan or
MADRAS interfaces or the Patent Application Image Retrieval (PAIR)
system.
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

5
copies of the above-listed evidence relied upon by Appellants in the Appeal
Brief. As such, we have considered this evidence in reaching our decision.
THE REJECTIONS
Appellants seek review of the following rejections:
1. The Examiner rejected claims 1-57 under 35 U.S.C. § 102(b) as
anticipated by FocaLink’s prior public use of centralized ad serving
technology.
2. The Examiner rejected claims 1-57 under 35 U.S.C. § 102(b) as being
barred by Appellants’ public use or sale of the claimed invention more
than one year prior to Appellants’ filing date.
FIRST REJECTION (FOCALINK)
ISSUES
The Examiner found that FocaLink conceived of and reduced to
practice the claimed centralized ad serving technology well prior to the filing
of the ‘061 patent. Non-Final Office Action 17.2
Appellants argue claims 1-50 as a first group and claims 51-57 as a
second group. App. Br. 7. We select claim 1 as representative of the first
group and claim 51 as representative of the second group. Claims 2-50

2 Rather than restating the ground of rejection, the Examiner’s Answer refers
to the rejection as set forth in prior Office Actions, Paper No. 16 and 27.
Ans. 4. Paper No. 27 is a final Office action dated October 28, 2002 (“Final
Office Action”), and Paper No. 16 is a non-final Office action dated October
24, 2001 (“Non-Final Office Action”).
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

6
stand or fall with claim 1, and claims 52-57 stand or fall with claim 51.
37 C.F.R. § 41.37(c)(1)(vii).
With regard to claim 1, Appellants contend that the various FocaLink
documents describing the SmartBanner technology do not disclose an
advertisement server node that stores information about a user node and then
uses that information to select an advertising node. App. Br. 7; Reply
Br. 2-5. With regard to claim 51, Appellants contend that the various
FocaLink documents describing the SmartBanner technology do not disclose
selecting an advertising node based on a number of times the advertising
content has been previously displayed at the user node. App. Br. 7; Reply
Br. 5-7.
The issues presented by this appeal are:
Do the FocaLink documents show that FocaLink’s Smart Banner
technology stored information about a user node at an advertisement server
node and selected an advertising node based on information stored about the
user node at the advertisement server node?
Do the FocaLink documents show that FocaLink’s Smart Banner
technology included an advertisement server node that, upon receiving a
request for advertising content from a user node, selected an advertiser node
based on a number of times advertising content had been previously
displayed at the user node?
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

7
FINDINGS OF FACT
We adopt the Examiner’s findings as to the scope and content of the
FocaLink system, as set forth in the Examiner’s Answer, the Final Office
Action, and the Non-Final Office Action, as our own. We add the following
findings, which are supported by at least a preponderance of the evidence.
Ethicon, Inc. v. Quigg, 849 F.2d 1422, 1427 (Fed. Cir. 1988) (explaining the
general evidentiary standard for proceedings before the Office).
1. Appellants’ patent describes:
For each user identified by the system as shown in
FIG. 3A, a user identification, IP address, domain type,
time zone, location of the user, standard industrial code
for the user’s network, the particular advertisements seen
and the number of times each such advertisement is seen,
the advertisements that were selected or “clicked on” and
the pages on which the various users’ advertisements
were seen is collected.
‘061 Patent, col. 4, ll. 44-51; Fig. 3A.
2. Appellants’ patent describes that in response to an incoming
message to the advertising server process 19, the advertising server
process 19 first attempts to identify the user by looking up the IP
address of the requesting browser (the user’s IP address) in a table
that stores identification numbers that correspond to IP addresses
for the users who have previously contacted the advertising server
process. ‘061 Patent, col. 5, ll. 10-12, 34-37. Appellants’ patent
describes:
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

8
if the user is an existing user, the ad server 19 obtains
from a database all of the information known about the
user including the user’s geographic location, the domain
type, the organization type where the user works, the
company size, the number of employees in that
company, the particular types of advertisements that the
user has clicked on and the number of times that the user
has been exposed to each advertisement currently in the
system.
‘061 Patent, col. 5, ll. 50-60. The ad server 19 then uses this
information to select a particular advertisement to transmit back to
the user. ‘061 Patent, col. 6, ll. 27-31.
3. As described in an email dated August 30, 1995 from David
Zinman of FocaLink to a representative of Ziff-Davis, FocaLink
provided detailed post-buy analysis reports for advertisers and
Web sites, including reports on “the number of people per day who
view an advertisement”, “the number of people who click on an
advertisement”, and “the Internet demographics of those who view
or click on an advertisement.” DX 93, p. 1. The email states that
advertisers can use these post-buy analysis reports to change
graphics, targeting, and scheduling of ads, and that “[t]he process
is an iterative one: ads are placed, results are studied, and
placement plans are improved.” DX 93, pp. 1-2.
ANALYSIS
Independent claim 1 recites “an advertisement server node storing
information about said user node, said advertisement server node being
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

9
responsive to a request from said user node based on said link message to
select said advertiser node as a selected advertiser node based upon the
information stored about said user node at said advertisement server node.”
The Examiner determined that claim 1 does not require that the
information about the user node be stored for any length of time at the
advertisement server node, and that “[i]n order for FocaLink’s system to be
able to target based upon a domain name, operating system, or browser
employed, it would at least have to be temporarily stored [such as in a
memory buffer] or else the programming code could not utilize the
information.” Ans. 6-7. Appellants do not contest the finding that FocaLink
must store the user node information in temporary storage in the
advertisement server node in order to utilize the information. Reply Br.
passim. Rather, Appellants argue that the Examiner’s interpretation of
“stored” is unreasonably broad because it would include within the scope of
the claim any “use” of such information, whether it is available for future
use by the advertisement server node or not, essentially reading the term
“stored” out of the claims. Reply Br. 4. Appellants further argue that the
plain meaning of “stored” requires the ability to maintain the information
“for future use”, and that such an interpretation of “stored” is consistent with
the description of the invention provided in Appellants’ Specification. Id.
We determine the scope of the claims in patent applications not solely
on the basis of the claim language, but upon giving claims “their broadest
reasonable interpretation consistent with the specification” and “in light of
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

10
the specification as it would be interpreted by one of ordinary skill in the
art.” In re Am. Acad. of Sci. Tech. Ctr., 367 F.3d 1359, 1364 (Fed. Cir.
2004) (citations omitted).
We first look to Appellants’ patent. While the patent does not provide
an explicit definition of “stored”, Appellants’ patent describes a database
maintained by the advertising server that stores information about a user
node, such as from a first contact with the server, so that when the
advertising server receives a subsequent contact from the user node, it can
retrieve the stored user node information and use it to select an advertising
node (Facts 1, 2). Thus, within the context of the embodiment described in
Appellants’ patent, future use of the user node information appears to refer
to use of information, which had been previously stored as a result of a first
contact between the user node and the ad server, by the ad server to select an
advertisement during a subsequent contact between the user node and the ad
server.
Appellants do not appear to be arguing, however, that “stored”, as
used in claim 1 and when read in light of Appellants’ Specification, requires
storage of information acquired as a result of a first contact with a user node
for future use during a subsequent contact from the user node. Rather,
Appellants argue only that “stored” requires storage for a duration long
enough to allow use of the stored information in the future. Reply Br. 4
(citing definition from The American Heritage Dictionary, Second College
Edition (1985)). Even storage of user node information in a temporary
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

11
storage buffer that is later retrieved during the same instance of contact
between the user node and ad server would be considered future use of the
temporarily stored information. As noted by the Examiner, Appellants’
claims do not clarify the length of storage of the information prior to the
advertising server accessing the information to make a selection. Ans. 6.
Further, the claims do not require storage of the user node information in
any particular storage means that would exclude storage in temporary
storage such as a memory buffer. As such, we do not find any language in
the claim itself or any description in Appellants’ patent that would render
unreasonable the interpretation of the term “stored” made by the Examiner.
Since Appellants do not contest the Examiner’s finding that
FocaLink’s system inherently stores user node information in temporary
storage (Ans. 6-7), we sustain the Examiner’s finding that the FocaLink
system anticipates claim 1. Claims 2-50 fall with claim 1.
Claim 51 recites “a user node” and “an advertisement server node
responsive to a request from said user node based on said link message to
select said advertiser node as a selected advertiser node”, and further recites
that “said advertisement server node selects said advertiser node based on a
number of times said advertising content has been previously displayed at
said user node.” (Emphasis added.) The Examiner found:
FocaLink teaches basing advertisements upon the number of
people per day who view/click on an advertisement. This
encompasses Applicants’ claim language, as it is comprising
claim language and the individual would be one of the number
of people per day who viewed the advertisement and FocaLink
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

12
is basing its decision upon the number of times the individual
and others have viewed the ad.
Ans. 7.
Again, Appellants take issue with the Examiner’s interpretation of the
claims. In particular, Appellants argue that claim 51 requires the
advertisement server node to select an advertiser node based on a number of
times the advertising content has been previously displayed at the user node
and that the ad selection process is performed in connection with a request
from the user node. Reply Br. 5. Appellants argue that FocaLink’s
disclosure of collecting post-buy information about the number of people per
day who viewed or click on an ad does not anticipate the claimed network
where ad selection is performed in connection with a request from a user
node and based on the number of times the advertising content has been
previously displayed at that particular user node. Id.
We agree with Appellants’ reading of claim 51 to require that the
advertising server node selects an advertising node based on a number of
times the advertising content has been previously displayed at the particular
user node from which the request for content was received. We further
agree with Appellants that FocaLink’s collection of information on the
number of views/clicks to use in post-buy ad selection, as described above in
Fact 3, does not meet the requirements of claim 51. As such, we will not
sustain the rejection of claim 51, and claims 52-57, which contain similar
limitations.
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

13
SECOND REJECTION (COMMERCIAL OFFER FOR SALE)
ISSUE
The Examiner’s rejection is based on evidence of a commercial offer
for sale of the invention prior to the critical date.3 In particular, the
Examiner found that under the Uniform Commercial Code, Kevin
O’Connor, one of the named inventors, made a commercial offer for sale of
Appellants’ claimed invention during a telephone call with Christopher
Buckingham of Attachmate prior to October 29, 1995.4 Ans. 13.
Appellants argue claims 1-57 as a group. Appellants contend, inter
alia, that no commercial offer for sale was made prior to the critical date.
App. Br. 8-14; Reply Br. 8-12.
The issue presented by this appeal is:
Did Appellants make a commercial offer for sale of the claimed
invention prior to the critical date?
ADDITIONAL FINDINGS OF FACT
4. Kevin O’Connor declares that he called Chris Buckingham of
Attachmate sometime during the last week of October 1995 and
during this conversation, Mr. O’Connor disclosed the concept of
offering targeted advertising across a network, and Mr.

3 The ‘061 Patent was first filed on October 29, 1996, and thus the critical
date is October 29, 1995.
4 It is undisputed that the phone call took place prior to the critical date.
Ans. 13, App. Br. 9.
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

14
Buckingham asked him to send a proposal. O’Connor Decl., paras.
24 and 25.
5. Kevin O’Connor further declares that he wrote a letter to Mr.
Buckingham, dated October 30, 1995, “suggesting possible terms
for an advertising relationship between IAN and Attachmate (the
“Attachmate Letter”). O’Connor Decl., para. 26 (referring to
Exhibit C).
6. Kevin O’Connor further declares at the time he sent the
Attachmate Letter, IAN did not have a targeted advertising product
to sell, but that IAN did have the capability to hard-code ads
directly into their Web site, so he “therefore proposed that
Attachmate spend $10,000 for such hard-coded, untargeted ads”
and asked Attachmate “to set aside another $10,000 that we would
allocate towards targeted third-party advertising ‘[w]hen the
targeting software is completed and we better determine the best
target profile.’” O’Connor Decl., para. 27 (quoting Exhibit C).
7. In the Attachmate Letter, Mr. O’Connor wrote, “I enjoyed our
discussion last week and am pleased that you will be one of our
initial advertising sponsors.” Attachmate Letter (DX 38), para. 1.
8. In the Attachmate Letter, Mr. O’Connor further wrote:
I suggest the following:
1. Attachmate/Cincinnati agrees to sponsor IAN for
$20,000, due December 31st, 1995.
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

15
2. Over the next several months, we will do 400,000
non-targeted advertisements for NetWizard (or any
other products you wish to advertise) and carefully
track the viewer demographics and determine the
most likely user profile to follow an AdJump
(clicking on the ad to find out more information).
This portion of the advertisement is valued at
$10,000
3. When the targeting software is completed and we
better determine the best target profile (e.g., airlines
and financial institutions) we can best determine the
most effective way to spend the $10,000 balance. I
have attached our draft advertising rate sheet.
Attachmate will receive most favorable pricing.
4. Attachmate agrees to participate in the public
announcement of IAN.
5. IAN will include Attachmate in collateral material
and press releases.
6. This agreement will remain confidential until the
public announcement of IAN.
Attachmate Letter (DX 38), pp. 1-2.
9. Mr. Buckingham testified that during his October 1995 call with
Mr. O’Connor, Mr. O’Connor told him that his new venture could
target ads to certain people on the Internet based on demographics
through interpretation of the TCP/IP address. Buckingham Depo.,
33:3-12; id. at 71:14-16.
10. Mr. Buckingham testified that during his October 1995 call with
Mr. O’Connor, Mr. O’Connor talked about a sponsorship for his
company or his technology, and as a result of that, Mr. O’Connor
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

16
would guarantee Attachmate distribution of ads and would provide
reports on click throughs. Buckingham Depo., 34:2-8.
11. Mr. Buckingham testified that during his October 1995 call with
Mr. O’Connor, Mr. O’Connor promised that his technology would
enable Attachmate to provide ads to certain types of people and
types of accounts and that he would provide this “over a certain
period of time, or a certain number of sites.” Buckingham Depo.,
35:2-11; see also id. at 36:9-25; 37:5-10; and 39:5-11.
12. Mr. Buckingham testified that during his October 1995 call with
Mr. O’Connor, Mr. O’Connor discussed compensation of $20,000
for this service and that he agreed “right on the phone” to pay the
$20,000. Buckingham Depo., 35:12-16; id. at 72:5-14.
13. Mr. Buckingham testified that during his October 1995 call with
Mr. O’Connor, he agreed on behalf of Attachmate to become one
of Mr. O’Connor’s new venture’s initial advertising sponsors.
Buckingham Depo., 38:4-11.
14. Mr. Buckingham testified that his October 1995 call with Mr.
O’Connor was essentially a sales call and that none of the
conversation was devoted towards Mr. O’Connor seeking Mr.
Buckingham’s advice on what Mr. O’Connor’s new venture was
doing or gaining a better understanding of whether Internet
advertising would be important. Buckingham Depo., 40:14 – 41:1.
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

17
15. Mr. Buckingham testified that the six items listed in the
Attachmate Letter memorialize the contents of Mr. Buckingham’s
conversation with Mr. O’Connor, except that Mr. Buckingham did
not recall discussing: (1) the use or quantity of non-targeted
advertisements, enumerated in item 2 of the Attachmate Letter, or
(2) the timing of targeted ads or determining the best target profile
for financial institutions, as mentioned in item 3 of the Attachmate
Letter, or (3) including Attachmate in IAN press releases and
collateral materials mentioned in item 5 of the Attachmate Letter,
or (4) confidentiality of the agreement, as set forth in item 6 of the
Attachmate Letter. Buckingham Depo., 42:2 – 46:8; id. at 60:17-
23; id. at 62:6-10. Mr. Buckingham further testified that he did not
have “any reason to believe that what’s outlined [in the Attachmate
Letter] is any different than what [he and Mr. O’Connor]
discussed.” Id. at 60:23-25. However, Mr. Buckingham also
testified that his impression from the call was that Attachmate
would get targeted advertising right away. Id. at 64:17-24.
16. Mr. Buckingham testified that he was not expecting a follow-up
letter from Mr. O’Connor following their October 1995 call, and
that he thought Mr. O’Connor would do the work and send
Attachmate an invoice. Buckingham Depo., 48:21 – 49:3.
However, he further testified that it is possible that he asked Mr.
O’Connor to send him a written proposal. Id. at 72:15 – 73:8.
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

18
17. Mr. O’Connor testified that he called Mr. Buckingham a week
before the Attachmate Letter to get his advice on the business and
what they were thinking about doing and that he doesn’t recall
asking Attachmate to become a sponsor. O’Connor Depo.,
221:22 – 223:25.
18. Mr. O’Connor testified that he did not recall discussing the cost
that Attachmate would pay to become one of IAN’s advertising
sponsors during the October 1995 call with Mr. Buckingham, but
that it was possible that during this call they discussed a monetary
amount that Attachmate might pay in order to become an initial
advertising sponsor. O’Connor Depo., 224:24 – 225:6; id. at
242:5-21.
19. Mr. O’Connor testified that he recalls that during the October 1995
call, Mr. Buckingham asked him to send a proposal, and that this
request forced Mr. O’Connor to put together something definitive.
O’Connor Depo., 242:15-25.
PRINCIPLES OF LAW
The Supreme Court in Pfaff v. Wells Electronics, Inc. held that the on-
sale bar applies when two conditions are satisfied: “[f]irst, the product must
be the subject of a commercial offer for sale.... Second, the invention must
be ready for patenting.” 525 U.S. 55, 67 (1998).
“The first prong of [the Pfaff] test involves a determination of whether
a commercial offer for sale has occurred, applying traditional contract law
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

19
principles.” Allen Eng’g Corp. v. Bartell Indus., Inc., 299 F.3d 1336, 1352
(Fed. Cir. 2002) (citing Linear Tech. Corp. v. Micrel, Inc., 275 F.3d 1040,
1048 (Fed. Cir. 2001) and Group One, Ltd. v. Hallmark Cards, Inc., 254
F.3d 1041, 1047 (Fed. Cir. 2001)).
The court in Linear Tech., relying on the court’s decision in Group
One, explained that the federal common law of contract governs this
determination:
Because the on-sale bar involves questions of patent law
requiring national uniformity, Group One declined to rely on the
law of the particular state in which the transaction occurred,
instead holding that the existence of an offer for sale should be
analyzed “under the law of contracts as generally understood.”
Group One, 254 F.3d at 1047 [ ]. Group One further instructs
that the Uniform Commercial Code (“UCC”) should inform the
analysis of the contractual issues. Id. (“As a general
proposition, we will look to the Uniform Commercial Code
(‘UCC’) to define whether, as in this case, a communication or
series of communications rises to the level of a commercial offer
for sale.”). Of course, the UCC is a model code-it does not itself
have the force of law and no body of case law has explored its
provisions. Instead, it has been enacted with modifications in
the several states. Thus, the body of case law from which we
must draw guidance under Group One is that of the state and
federal courts interpreting their individual versions of the UCC.
From this body of state law, we will search for the common
denominator for assistance in crafting the federal common law
of contract that now governs the on-sale bar.
Linear Tech., 275 F.3d at 1048.
The Uniform Commercial Code (UCC) § 2-204(1) states, in pertinent
part, that “[a] contract for sale of goods may be made in any manner
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

20
sufficient to show agreement, including offer and acceptance….” As to the
question of what constitutes an “offer”, the court in Linear Tech. noted:
The UCC does not define “offer,” so we will look to the
common law to guide our inquiry. “An offer is the manifestation
of willingness to enter into a bargain, so made as to justify
another person in understanding that his assent to that bargain is
invited and will conclude it.” Restatement (Second) of
Contracts § 24 (1981); accord Richard A. Lord, Williston on
Contracts § 4:13, at 367 (4th ed. 1990) (explaining that “in order
for an offer to exist, it must constitute a manifestation
communicated to the offeree so as to justify his understanding
that by assenting a bargain will be concluded”).
275 F.3d at 1050. Restatement (Second) of Contracts, § 26 (1981) further
states:
A manifestation of willingness to enter into a bargain is not an
offer if the person to whom it is addressed knows or has reason
to know that the person making it does not intend to conclude a
bargain until he has made a further manifestation of assent.
Further, Restatement (Second) of Contracts, § 33 (1981) provides:
(1) Even though a manifestation of intention is intended to be
understood as an offer, it cannot be accepted so as to form a
contract unless the terms of the contract are reasonably certain.
(2) The terms of a contract are reasonably certain if they provide
a basis for determining the existence of a breach and for giving
an appropriate remedy.
(3) The fact that one or more terms of a proposed bargain are
left open or uncertain may show that a manifestation of intention
is not intended to be understood as an offer or as an acceptance.
The court in Group One, Ltd. v. Hallmark Cards, Inc., held that “the
correspondence and other interactions between Group One and Hallmark
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

21
prior to the critical date did not add up to a commercial offer to sell the
invention, an offer, for example, which Hallmark could have accepted.” 254
F.3d at 1048 (agreeing with the district court’s conclusion of no offer to sell
based on the indefinite nature of the communications between the parties
and the lack of specific terms such as price and quantity, finding that these
factors suggested preliminary proposals or invitations to negotiate, rather
than a formal offer.) The Court in Group One noted:
[C]ontract law traditionally recognizes that mere advertising and
promoting of a product may be nothing more than an invitation
for offers, while responding to such an invitation may itself be
an offer. Restatement (Second) of Contracts § 26 (1981). In any
given circumstance, who is the offeror, and what constitutes a
definite offer, requires looking closely at the language of the
proposal itself. Language suggesting a legal offer, such as “I
offer” or “I promise” can be contrasted with language
suggesting more preliminary negotiations, such as “I quote” or
“are you interested.” Differing phrases are evidence of differing
intent, but no one phrase is necessarily controlling. Id. §§ 24,
26.
254 F.3d at 1048.
In Linear Tech., the court held that LTC’s pre-critical date activities
did not constitute an offer for sale under general principles of contract law.
Id. at 1050. The court determined that the instances where at least one sales
representative spoke to potential customers in order to help LTC determine
an appropriate price for its chip, could not be considered offers, “because
[the communications] do not indicate LTC’s intent to be bound, as required
for a valid offer.” Id. (citing Restatement (Second) of Contracts § 26 (1981))
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

22
(additional citations omitted). The court also determined that “[t]he
communications from LTC sales representatives providing customers with
preliminary LT1070 data sheets likewise do not reveal the requisite intent to
be bound, a sine qua non of an offer.” Id. at 1051. Rather, the court held
that “[i]n the absence of a clear indication to the contrary, the
communications between the LTC sales representatives and the customers
must be regarded as merely preliminary negotiations at most designed to
enable customers to submit offers to buy.” Id.
ANALYSIS
The issue before us is whether the October 1995 phone call between
Mr. O’Connor of IAN and Mr. Buckingham of Attachmate was a
commercial offer for sale of the claimed invention prior to the critical date.
Appellants contend that the follow-up Attachmate Letter, dated after the
critical date, set out a new proposal to be considered by Attachmate, rather
than verifying a prior offer and acceptance made during the October 1995
phone call. Reply Br. 8. Further, Appellants contend that Mr.
Buckingham’s entire testimony about what may have been discussed during
the October 1995 phone call was “tainted” because Mr. Buckingham was
provided with a copy of the Attachmate Letter prior to being questioned
about the call and was never questioned on his independent memory of the
call. Reply Br. 9.
The evidence relied upon by the Examiner to show an on-sale bar
prior to the critical date fails to convince us that a commercial offer for sale
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

23
took place during the October 1995 phone call. While we find that during
the October 1995 phone call Mr. O’Connor described the IAN concept of
offering targeted advertising across a network (Fact 4), whether Messrs.
O’Connor and Buckingham discussed and agreed to sufficiently definite
terms to constitute an offer for sale is not clear from the record. For
example, it is not clear whether Mr. Buckingham requested a written
proposal from Mr. O’Connor during the October 1995 phone call. Compare
Fact 4 (Mr. O’Connor declares that Mr. Buckingham requested a proposal)
with Fact 16 (Mr. Buckingham testified that while he was not expecting a
follow-up letter from Mr. O’Connor, it is possible that he asked Mr.
O’Connor to send him a written proposal).
Further, as to the follow-up letter (the “Attachmate Letter”), Mr.
O’Connor declares that the letter included suggestions of possible terms for
an advertising relationship, including a proposal of how to allocate
Attachmate’s $20,000 investment (Facts 5, 6). This characterization of the
follow-up letter as containing merely suggestions and proposals, rather than
memorializing already agreed-upon terms, is consistent with the language
used in the Attachmate Letter itself, which introduced the proposed terms
with “I suggest the following.” (Fact 8). Further, Mr. Buckingham testified
that despite agreeing during the October 1995 phone call to pay $20,000 for
Attachmate to become one of IAN’s initial advertising sponsors (Facts 7, 12,
13), Mr. Buckingham did not recall discussing many of the terms outlined in
the follow-up Attachmate Letter with Mr. O’Connor during the call
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

24
(Fact 15). Thus, while it is entirely possible that Mr. O’Connor and Mr.
Buckingham discussed the general capabilities of IAN’s targeted advertising
technology (Facts 4, 9), and even agreed upon a price for Attachmate to
become one of IAN’s initial advertising sponsors (Facts 7, 9-14, 18), it is not
clear from the facts before us that Messrs. O’Connor and Buckingham had
reached mutual assent during the phone call as to the terms of the offer to a
degree sufficient as to constitute a sale (offer and acceptance) under general
contract law (Facts 15, 19).
Further, it is not clear from the record whether Mr. O’Connor had the
requisite intent to conclude the bargain on the phone call (Facts 8, 17), such
that he could be said to have made an “offer” under general contract law. In
particular, because the follow-up Attachmate Letter spelled out new
proposed terms for the bargain, the October 1995 discussion between
Messrs. O’Connor and Buckingham could be regarded as merely
preliminary negotiations and not a commercial offer for sale under general
contract law.
As such, we will not sustain the Examiner’s rejection of claims 1-57
under 35 U.S.C. § 102(b) as being barred by a commercial offer for sale of
the invention prior to the critical date.
CONCLUSIONS
The FocaLink documents show that FocaLink’s Smart Banner
technology stored information about a user node at an advertisement server
Appeal 2009-005869
Application 09/577,798
Patent 5,948,061

25
node and selected an advertising node based on information stored about the
user node at the advertisement server node.
The FocaLink documents fail to show that FocaLink’s Smart Banner
technology included an advertisement server node that, upon receiving a
request for advertising content from a user node, selected an advertiser node
based on a number of times advertising content had been previously
displayed at the user node.
The record does not contain evidence adequate to show that
Appellants made a commercial offer for sale of the claimed invention prior
to the critical date.
DECISION
The decision of the Examiner to reject claims 1-50 is AFFIRMED,
and the decision of the Examiner to reject claims 51-57 is REVERSED.

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) (2007).

AFFIRMED-IN-PART

nhl

FISH & RICHARDSON PC
PO BOX 1022
MINNEAPOLIS MN 55440-1022