Liberty Mutual Insurance Co.v.Progressive Casualty Insurance Co.

Patent Trial and Appeal Board

Feb 27, 2013

11580324 (P.T.A.B. Feb. 27, 2013)

Trials@uspto.gov Paper 13
571-272-7822 Entered: February 27, 2013

UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________

LIBERTY MUTUAL INSURANCE CO.
Petitioner

v.

PROGRESSIVE CASUALTY INSURANCE CO.
Patent Owner
____________

Case CBM2013-00001 (JL)
U.S. Patent No. 7,877,269
____________

Before JAMESON LEE, JONI Y. CHANG, and MICHAEL R. ZECHER,
Administrative Patent Judges.

LEE, Administrative Patent Judge

DECISION
Institution of Covered Business Method Patent Review
37 C.F.R. § 42.208

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I. INTRODUCTION
On October 2, 2012, Liberty Mutual Insurance Company (“Liberty”)
filed a petition (“Pet.”) requesting review under the transitional program for
covered business method patents of U.S. Patent 7,877,269 (“the ’269
patent”)(Ex. 1001). Paper 4. Patent owner, Progressive Casualty Insurance
Company (“Progressive”), filed a preliminary response (“Prel. Resp.”) on
January 4, 2013. Paper 10. We have jurisdiction under 35 U.S.C. § 324.
The standard for instituting a covered business method patent review
is set forth in 35 U.S.C. § 324(a), which provides:
THRESHOLD –The Director may not authorize a post-grant
review to be instituted unless the Director determines that the
information presented in the petition filed under section 321, if
such information is not rebutted, would demonstrate that it is
more likely than not that at least 1 of the claims challenged in
the petition is unpatentable.
Liberty challenges claims 1-59 of the ’269 patent as being
unpatentable under 35 U.S.C. §§ 102 and 103. Pet. 15-78. Taking into
account Progressive’s preliminary response, we conclude that the
information presented in the petition does not demonstrate that it is more
likely than not that claims 1-59 are unpatentable. Pursuant to 35 U.S.C.
§ 324 and section 18(a) of the Leahy-Smith America Invents Act (“AIA”),
we do not authorize a covered business method patent review to be instituted
as to claims 1-59 for the grounds of unpatentability asserted in Liberty’s
petition.
Accordingly, the petition is DENIED.
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A. Standing
Section 18 of the AIA governs the transitional program for covered
business method patent review. Section 18(a)(1)(B) of the AIA limits such
reviews to persons or their privies that have been sued or charged with
infringement of a covered business method patent.
Liberty indicates that the ’269 patent was asserted against it in
Progressive Cas. Ins. Co. v. Allstate Ins. Co. et al., Case No. 1:11-cv-00082,
pending in the U.S. District Court for the Northern District of Ohio. Pet. 5.
Progressive does not dispute that it asserted the ’269 patent against Liberty.
B. Covered Business Method Patent
Under § 18(a)(1)(E) of the AIA, the Board may institute a transitional
proceeding only for a patent that is a covered business method patent.
Section 18(d)(1) of the AIA defines the term “covered business method
patent” to mean:
a patent that claims a method or corresponding apparatus for
performing data processing or other operations used in the
practice, administration, or management of a financial product
or service, except that the term does not include patents for
technological inventions.
The legislative history explains that the definition of covered business
method patent was drafted to encompass patents “claiming activities that are
financial or complementary to financial activity.” 157 Cong. Rec. S5432
(daily ed. Sept. 8, 2011) (statement of Sen. Schumer).
Section 18(d)(2) of the AIA provides that “the Director shall issue
regulations for determining whether a patent is for a technological
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invention.” The legislative history points out that the regulation for this
determination should only exclude “those patents whose novelty turns on a
technological innovation over the prior art and are concerned with a
technical problem which is solved with a technical solution and which
requires the claims to state the technical features which the inventor desires
to protect.” 157 CONG. REC. S1364 (daily ed. Mar. 8, 2011) (statement of
Sen. Schumer).
Pursuant to that statutory mandate, the Office promulgated 37 C.F.R.
§ 42.301(b) to define the term “technological invention” for the purposes of
the transitional program for covered business method patents. Therefore, for
determining whether a patent is for a technological invention in the context
of the transitional program for covered business method patents, 37 C.F.R.
§ 42.301(b) identifies the following for consideration:
whether the claimed subject matter as a whole recites a
technological feature that is novel and unobvious over the prior
art; and solves a technical problem using a technical solution.
The determination of whether a patent is eligible for covered business
method patent review is based on what the patent claims. A patent having
even just one claim directed to a covered business method is eligible for
review even if the patent includes additional claims.
1

1
Transitional Program for Covered Business Method Patents – Definitions
of Covered Business Method Patent and Technological Invention; Final
Rule, 77 Fed. Reg. 48734, 48736 (Aug. 14, 2012) (Response to Comment 8).
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Claim 53 of the ’269 patent relates to how to provide an insurance
service. Claim 53 begins with this preamble: “An on-line insurance policy
service system” (emphasis added). Claim 53 ends with the recitation:
“wherein the existing insurance policy comprises a health, a property-
casualty, or a liability insurance policy” (emphasis added). Claim 53 also
recites an interface that “enables an insurance policy holder to access
personal and historical insurance information remotely through a policy
accessible network and software linked to the insurance information,” and
a visual output configured “to transmit display data that renders a visual of
the insurance policy parameter of the insurance policy holder” (emphasis
added).
In addition, claim 53 recites three software modules (emphasis
added):
(1) an information module “to identify the insurance
policy holder and verify an insurance policy parameter of an
existing insurance policy of that insurance policy holder in
response to data received from the insurance policy holder
through the publicly accessible network and the interface”;

(2) an insurance policy adjustment module “that adjusts
an insurance policyholder’s selected insurance policy
parameter in real time in response to second data received
from the insurance policyholder through the publicly
accessible network and the interface”; and

(3) a payment module “that determines a cost of the
adjustment to an insurance premium in response to the
adjustment of the insurance policyholder’s selected insurance
policy parameter.”
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The insurance policy adjustment module also “communicates to the
interface an acknowledgment comprising the change in the insurance
premium resulting from the adjustment in the insurance policyholder’s
selected insurance policy parameter” (emphasis added).
It cannot be reasonably disputed that Progressive claims “an apparatus
for performing data processing or other operations used in the practice,
administration, or management of a financial product or service.” Any one
of health insurance, property-casualty insurance, and liability insurance as is
recited in claim 53 is a financial product, and the activities recited in
claim 53 about the insurance policy together constitute a financial service.
The question at issue here centers on the “technological invention”
exception to a covered business method patent.
To qualify under the “technological invention” exception to covered
business method patent review, it is not enough that the invention makes use
of technological systems, features, or components. The exception is not that
the claimed invention makes use of technology. We agree with Liberty that
the subject matter of claim 53 does not satisfy the “technological invention”
exception to covered business method patent review.
In determining whether a patent is for a technological invention, the
following shall be considered (37 C.F.R. § 42.301(b)):
1. recites a technological feature that is novel and
unobvious over the prior art, and

2. solves a technical problem using a technical solution.

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With respect to the first prong, Progressive’s argument (Prel. Resp.
12:6-7) that claim 53 as a whole is directed to technological features is
misplaced. As we discussed above, simply making use of technology is not
the test for meeting the “technological invention” exception. In that regard,
the Office Patent Trial Practice Guide, 77 Fed. Reg. 48764 (Aug. 14, 2012),
states:
The following claim drafting techniques would not typically
render a patent a technological invention:

(a) Mere recitation of known technologies, such as computer
hardware, communication or computer networks, software,
memory, computer-readable storage medium, scanners, display
devices or databases, or specialized machines, such as an ATM
or point of sale device.
Progressive does not contend that any of the claimed components of
claim 53 by themselves constitute a new technological feature, only that the
combination of claim elements as a whole forms a new technological
feature. The latter is unpersuasive in light of: (1) the claim itself, (2) the
specification, and (3) the state of the art at the time of Progressive’s
invention.
As we have presented above, the insurance nature of the data being
collected, transferred, received, and processed is not only an intended use of
the claimed apparatus, but is fully integrated into every aspect and element
of claim 53 such that it appears that the claimed invention as a whole has no
other use but to collect, transfer, receive, and process insurance information
in the particular manner as specified in the claim. If stripped of everything
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related to collection and maintenance of insurance data and insurance policy
parameters, there is nothing left but generic and well known components
used in their ordinary manner to achieve a predictable result, such as an
interface, a computer system that facilitates data transfer from the interface,
software modules, and a visual output. In that regard, we see no technical
innovation such as a faster computer and interface, and Progressive has
identified none. The innovation colorably stems from the insurance nature
of the data collected, transferred, received and processed.
The specification of the ’269 patent does not describe any faster
computer, more efficient interface, or a visual output with higher resolution.
Instead, the specification omits detailed instructions on how to assemble and
form each of the technical components and generally discusses simply what
is to be accomplished. That is an indication that the technology used for
practicing the claimed invention is merely conventional and well known to
one with ordinary skill in the art.
In the preliminary response at page 2, Progressive describes itself as
being driven to serve its customers in innovative ways and noted various
examples of such innovation. One example is that it was the first to allow
policyholders to pay insurance premiums in monthly installments with no
extra charge. Prel. Resp. 2:8-11. Another example is that it was the first to
put auto damage and expert estimating together by providing drive-in-claim-
service. Prel. Resp. 2:11-13. A further example is that it began to respond
to claim calls around the clock and to provide immediate response through
on-call adjusters to service accident victims on the spot. Prel. Resp. 2:13-16.
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It is evident that in the insurance industry, not all innovations stem from a
novel and unobvious technological feature. Yet, each of the above-noted
innovations still may depend on and make use of technology, e.g., computer,
software, database, or telephone. Inclusion of those technical components in
a claim would not transform those innovations in providing an insurance
product and service into a technological invention. The subject matter of
claim 53 appears no different.
Progressive argues that within the congressional record of the Leahy-
Smith America Invents Act, Pub. L. No. 112-29, § 18, 125 Stat. 284, 331,
are two examples of subject matter not covered under a covered business
method patent review (Prel. Resp. 8:13 to 9:7):
1. A patent for a trading strategy would be subject to review,
while an electronic trading tool, such as graphical user interface
or network, which allows an electronic trader to place a trade
order with an electronic exchange, would not. See, e.g., Ex.
2004, at 2, 157 Cong. Rec. S5428 (daily ed. September 8,
2011)(statements of Sen. Schumer and Sen. Durbin)(discussing
the software tools used to implement trading strategies).

2. A patent that is directed at machinery to count, sort, and
authenticate currency and paper instruments also would not be
subject to review. See, e.g., id. (confirming that the technology
used to “count, sort, and authenticate currency and paper
instruments” are technological inventions).

The argument is unpersuasive. With respect to the first example, the
premise is that the trading strategy is not claimed and that the electronic
trading tool is itself novel and nonobvious apart from its association with the
trading strategy. In that regard, we have already noted that the Office Trial
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Practice Guide provides that claim drafting techniques such as the inclusion
of known technologies would not typically render a patent a technological
invention. 77 Fed. Reg. 48764 (Aug. 14, 2012). With regard to the second
example, the subject matter of claim 53 is not directed at machinery to
count, sort, and authenticate currency and paper instruments.
We note that even the processing of data in an on-line network setting
in real-time was well known at the time of Progressive’s invention, as is
evidenced by this definition of “real-time” from the IEEE Standard
Dictionary of Electrical and Electronics Terms, Sixth Edition (1996):
2

Pertaining to a system or mode of operation in which
computation is performed during the actual time that an
external process occurs, in order that the computation results
can be used to control, monitor, or respond in a timely manner
to the external process. Contrast: batch. See also:
conversational; interactive; interrupt; on-line.
The specification of the ’269 patent does not indicate that the named
inventors were the first to invent on-line processing of data in real-time. Nor
does Progressive make that assertion in its preliminary response.
Therefore, on this record, the subject matter as a whole of claim 53
does not recite a novel and unobvious technical feature. All of the
components as claimed, except the insurance nature of the data being
processed, are known and operated in their ordinary and predictable manner.

2
A copy of the IEEE dictionary definition of “real-time” is attached to this
opinion.
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We also conclude that the subject matter of claim 53 as a whole does
not use a technical solution to solve a technical problem.
Progressive is correct that general classification of the ’269 patent in
the Patent and Trademark Office is of little relevance, because the issue
concerns a statutory “exception.” However, the invention of claim 53 still
does not solve any technical problem with a technical solution because there
simply was no technical problem to be solved given the state of the
technology at the time of Progressive’s invention.
According to Progressive, the claimed modules provide a technical
solution to the technical problem of allowing direct verification of insurance
policy parameters by a user in real-time, direct adjustment of insurance
policy parameters by a user in real-time, and direct confirmation back to the
user in real-time, all without need of assistance from an insurance agent or
representative. However, the assertion is unpersuasive. It is misplaced
because: (1) the technology useable for implementing direct and real-time
identification of a user and direct and real-time verification of insurance
parameter on-line over a publicly accessible network was generally available
and required no technical innovation; (2) the technology useable for
implementing real-time adjustment of a user’s insurance policy parameters
on-line over a publicly accessible network was also generally available and
required no technical innovation; and (3) the technology useable for direct
confirmation back to the user requesting the change in insurance parameters
was also generally available and required no technical innovation. There
was no technical problem in need of a technical solution.
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Progressive asserts that “[t]raditionally, it was not possible
to service insurance without the assistance of an insurer, agent, or
representative.” Prel. Resp. 15:14-16. Progressive further asserts:
“[i]nstead, once a customer purchased his/her insurance, the consumer had
to work with an agent or other insurance company representatives in person
to effect desired changes in his or her policy, such as adding or deleting a
driver, changing, adding or deleting a vehicle, or changing policy limits,
coverages or deductibles.” Prel. Resp. 15:16-20. Those assertions do not
relate to any “technical problem,” but to a mere tradition which took time to
change. Also, Progressive’s characterization that it was “not possible to
service insurance without the assistance of an insurer, agent, or
representative” is incorrect from the point of view of the state of the art of
the technology in existence at the time of the invention, as we have already
discussed at length above.
Therefore, the second prong for qualifying as a “technological
invention” is also not satisfied.
For the foregoing reasons, the subject matter of claim 53 is not a
“technological invention” under 37 C.F.R. § 42.301(b). Accordingly, the
’269 patent is eligible for a covered business method patent review.

C. Prior Art Relied Upon
Liberty relies upon the following prior art references:
Tawil US 5,225,976 July 6, 1993 Ex. 1007
Chelliah US 5,710,887 Jan. 20, 1998 Ex. 1006
Peterson US 5,903,873 May 11, 1999 Ex. 1004
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D. Alleged Grounds of Unpatentability
Liberty seeks review of claims 1-59 of the ’269 patent based on the
following alleged grounds of unpatentability:
1. claims 1-16, 24, 30-42, 44-54, and 56-59 as anticipated under 35
U.S.C. § 102 by Peterson (Pet. 15-54);
2. claims 1-59 as unpatentable under 35 U.S.C. § 103(a) over
Peterson (id. at 55-67);
3. claims 10-12, 17-29, 53, 57, and 59 as unpatentable under 35
U.S.C. § 103 over the combination of Peterson and Chelliah (id. at 67-75);
4. claims 35, 36, and 57-59 as unpatentable under U.S.C. § 103(a)
over the combination of Peterson and Tawil (id. at 75-78); and
5. claims 57 and 59 as unpatentable under 35 U.S.C. § 103(a) over
the combination of Peterson, Chelliah, and Tawil. Id. at 78.
E. The Invention of the ’269 Patent
The invention of the ’269 patent generally relates to an insurance data
communication and processing system. Ex. 1001, spec. 1:12-19. In
particular, the insurance data processing system allows a policyholder to
access, view, and update insurance policy information via the Internet.
Ex. 1001, spec. 2:62-65. After the policyholder is authenticated, the system
retrieves and displays the information requested by the policyholder.
Ex. 1001, spec. 2:65-3:2. The system employs a friendly user-interface that
guides the policyholder through various activities. Ex. 1001, spec. 2:65-67.
Those activities include, but are not limited to: (1) reviewing billing
information, (2) making a payment via a credit card or on-line check, (3)
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reviewing policy information, (4) reviewing state specific contract
information, (5) quoting and endorsing for vehicle replacement, (6) making
address changes, and (7) reviewing claim information. Ex. 1001, spec. 2:65-
3:4. The system displays both the premium amount and variance, and
updates the file of the policyholder at the request of the policyholder without
the need for personal handling by an individual representative of the insurer
or an independent agent. Ex. 1001, spec. 3:4-8.
Figure 2, which is reproduced below, illustrates a block diagram that
identifies the principal processing modules of the insurance data processing
system. Ex. 1001, spec. 2:48-49.

The insurance data processing system illustrated in Figure 2 is segregated
into four critical areas of content: (1) policy information 30; (2) policy
changes 32; (3) policy quotes 34; and (4) claims information 36. Ex. 1001,
spec. 5:43-46. A prospective user can navigate to each module from the
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Personal Progressive main menu 38 by accessing web pages that specifically
are designed to guide the policyholder to the desired information via clicks
on alternative query marks or via input of necessary information. Ex. 1001,
spec. 5:46-51. Figure 2 also illustrates another module 37 that provides the
policyholder with the ability to acquire on-line forms typically comprising
duplicate insurance forms, such as identification cards and declaration page
sets. Ex. 1001, spec. 5:55-58. As is shown in Figure 2, a payment module
40 can be accessed through the policy information module 30. Through the
payment module 40, a user can select a payment amount via the current
amount due, and either pay in full or just the minimum amount due via an
on-line check or credit card. Ex. 1001 6:21-29.
F. Illustrative Claim
Claims 1, 10, 13, 15, and 53 are the independent claims. Independent
claim 10 is illustrative:
1. An on-line insurance policy service system
comprising:
a web browser for accessing remote insurance information by
an insurance policyholder and software linked to the remote
insurance information;
a publicly accessible distributed network for transferring data
from the web browser;
an information module, remote from the web browser coupled
to the publicly accessible distributed network, that identifies the
insurance policyholder and verifies an insurance policy
parameter of an existing insurance policy of the insurance
policyholder in real-time in response to first data received from
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the insurance policyholder through the publicly accessible
distributed network and the web browser;
where the first data comprises a personal security code that
allows access to insurance policy parameters of the insurance
policyholder;
an insurance policy adjustment module, remote from the web
browser coupled to the publicly accessible distributed network,
that adjusts the insurance policyholder’s insurance policy
parameter in real-time in response to second data received
from the insurance policyholder through the publicly accessible
distributed network and the web browser,
where the second data comprises a selection of the insurance
policy parameter;
where the insurance policy adjustment module provides an
acknowledgement to the web browser in response to the
adjustment of the selected insurance policy parameter within
the existing insurance policy, and implements the adjustment to
the existing insurance policy; and
where an insurer’s computer generates an insurance document
customized to the insurance policyholder as identified by the
personal security code and sends the customized insurance
document to the web browser in response to the second data
received from the insurance policyholder through the publicly
accessible distributed network and the web browser.
Ex. 1001, claims—spec. 9:2-30 (emphasis added).

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II. FINDINGS OF FACT

The following findings of facts are supported by a preponderance of
the evidence.
A. Peterson
1. Peterson discloses a system that registers insurance transactions
and communicates such transactions to the home office computer of an
insurance company. Ex. 1004, spec. 1:6-9. Figure 1 of Peterson, which is
reproduced below, illustrates the system. Ex. 1004, spec. 6:7-10.

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The system illustrated in Peterson’s Figure 1 includes a home office 5, at
least one portable computer 10, and a communication interface 20.
Ex. 1004, spec. 7:50-54. Peterson discloses that each portable computer 10
includes a display screen 12, a computer processor 14, a manual input unit
16, and a data storage element 17 that stores insurance information
pertaining to a plurality of insurance customers. Ex. 1004, spec. 7:59-62.
Peterson discloses that the communication interface 20 includes
communication software 22 and a modem 24. Ex. 1004, spec. 9:11-13.
In particular, Peterson discloses that the communication software 22
includes a commercially available package of communication software
known as RemoteWare® by XcelleNet. Ex. 1004, spec. 9:13-16 (emphasis
added).
2. Figure 3 of Peterson, which is reproduced below, illustrates
a block diagram of a home office computer. Ex. 1004, spec. 6:14-15.

The home office computer illustrated in Peterson’s Figure 3 contains a home
office computer array 50, which includes a central data storage element 51,
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a data processor 52, and a communication hub 53. Ex. 1004, spec. 11:22-25.
Peterson discloses that the communication hub 53 may be configured to
include a plurality of server computers 54, each of which has a keyboard,
display screen, memory, data storage, a local area network 55 linking the
server computers 54 to the data processor 52, and a modem pool connecting
the server computers 54 to the telephone network 6. Ex. 1004, spec. 12:12-
20. In particular, Peterson discloses that the server computers 54 utilize
RemoteWare® software by XcelleNet. Ex. 1004, spec. 12:21-24 (emphasis
added).
4. In a preferred embodiment, Peterson discloses transmitting
agent transaction information from the second group of storage tables stored
in the data storage element 17 of the portable computer 10 to the home
office computer 5 on a nightly basis. Ex. 1004, Spec. 12:31-35. Likewise,
Peterson discloses transmitting the district office transaction information to
the home office 5 on a nightly basis. Ex. 1004, spec. 12:35-38. Peterson
discloses that the home office computer array 50 compiles both the updated
insurance information and the district-specific updated insurance
information derived from the nightly transmissions the following day. Ex.
1004, spec. 12:30-43.
5. Figure 17 of Peterson illustrates a sequence of events that occur
in a Home Office Connection mode. Ex. 1004, spec. 6:62-64.
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Referring to Figure 17 of Peterson, if an insurance agent selects the
scheduled type of home office connection (step 14.2), the portable computer
10 dials the home office 5 via the communication interface 20 at a scheduled
time overnight (step 14.2.1). Ex. 1004, spec. 33:10-14. Upon establishing a
connection with the home office 5, Peterson discloses that the portable
computer 10 transmits to the home office computer array 50 a collection of
transaction files preferably accumulated throughout one day (step 14.2.2).
Ex. 1004, spec. 33:14-20. Next, Peterson discloses that the home office
computer array 50 generates and transmits transaction files to the portable
computer 10 (step 14.2.4), and stores/updates the first group of storage
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tables in the data storage element 17 using the updated insurance
information from the home office 5. Ex. 1004, spec. 33:21-27.
Alternatively, if the insurance agent selects the urgent type of home
office connection (step 14.3), the portable computer 10 immediately dials up
the home office computer array 50 (step 14.3.1) without waiting for the
scheduled time. Ex. 1004, spec. 33:30-34. According to Peterson, the rest
of the home office connection proceeds in the same way as when the home
connection is made in the scheduled manner. Ex. 1004, spec. 33:34-36.
B. The RemoteWare® Press Release
6. The RemoteWare® press release is relied upon by Liberty as
extrinsic evidence to establish that certain claim features are necessarily
present in the RemoteWare® communications software package referred to
in Peterson. The RemoteWare® press release is an announcement by
XcelleNet, Inc. concerning the general commercial availability of version
3.1 of the RemoteWare® software package. Ex. 1005, pg. 1.
3
According to
the RemoteWare® press release, version 3.1 of the RemoteWare® software
package adds full messaging support, subscription and publishing services,
and accessibility from within a web browser. Id. The RemoteWare® press
release also discloses that version 3.1 of the RemoteWare® software
package lets remote users connect to the enterprise through an Internet
browser while it updates applications, exchanges files and electronic mail,

3
All references to the page numbers in the RemoteWare® press release are
to the page numbers located in the top, right-hand corner of each page.
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replicates databases, and updates price lists and other sales or marketing
information. Id. The RemoteWare® press release further discloses that the
Client Control aspect of version 3.1 of the RemoteWare® software package
allows users to initiate a RemoteWare® communications session from
within a webpage. Ex. 1005, pg. 2.

III. CLAIM CONSTRUCTION
During a covered business method patent review, the Board construes
claims by applying the broadest reasonable interpretation in light of the
specification. 37 C.F.R. § 42.300(b). If the specification does not set forth
an explicit or special definition for a claim term, we resort to its ordinary and
customary meaning as would be understood by one with ordinary skill in the
art. See Phillips v. AWH Corp., 415 F.3d 1303, 1312-13 (Fed. Cir. 2005) (en
banc). In some cases, the ordinary and customary meaning of a claim term
as would be understood by one with ordinary skill in the art may be readily
apparent even to lay judges, and claim construction in such cases involves
little more than the application of the widely accepted meaning of commonly
understood words. See id. at 1314.
Liberty has identified seven claim terms and its claim construction for
those terms. Pet. 12-14. Those claim terms are listed as follows:
(A) “enable[s] an insurance policyholder to access . . . insurance
data/information;” (B) “information module,” “insurance policy adjustment
module,” “payment module,” “payment enablement module,” “claims
information module,” and “policy quote(s) module;” (C) “insurance policy
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parameter;” (D) “real-time,” “in response to and at the same rate;”
(E) “personal security code;” (F) “adjustment;” and (G) “insurance
document.” Id. As a step to determine whether to institute a covered
business method patent review, we will address each claim term identified
by Liberty in turn.
A. “Enable[s] an insurance policyholder to access . . . insurance
data/information”
Liberty construes the claim phrase “enable[s] an insurance
policyholder to access . . . insurance data/information” to mean enabling an
insurance policyholder or someone acting on his or her behalf access
insurance information located elsewhere. Pet. 13. Liberty contends that the
specification of the ’269 patent does not limit that claim phrase to direct
access by a policyholder. Id. In response, Progressive contends that
Liberty’s claim construction with respect to the claim term “insurance
policyholder” is unreasonable. Prel. Resp. 21-23. Progressive argues that
throughout the specification, the claim term “insurance policyholder”
describes a person who holds ownership in an existing insurance policy
rather than a person, such as an insurance agent or other insurance company
personnel, acting on behalf of the insurance policyholder. Id. at 22-23
(citing to Ex. 1001, Abstract; spec. 1:41-53, 2:65-3:2, and 3:4-8). Moreover,
Progressive alleges that the use of the claim term “an insurance
policyholder” throughout the specification is consistent with its common
understanding in the insurance industry. Id. at 23. Progressive directs us to
a dictionary of insurance terms that defines a “policyholder” as an
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“individual or other entity who owns an insurance policy” and “synonymous
with policyowner.” Id. (citing to Ex. 2007, Harvey W. Rubin, Dictionary of
Insurance Terms, 3rd ed. (1995)).
Upon reviewing the specification, we do not find an explicit or special
definition for the claim term “insurance policyholder.” Therefore, we resort
to its ordinary and customary meaning as would be understood by one with
ordinary skill in the art. See Phillips, 415 F.3d at 1312. We agree that the
dictionary definition offered by Progressive amounts to the broadest
reasonable interpretation of the claim term “insurance policyholder.”
However, the claim phrase “enable[s] an insurance policyholder to access . .
. insurance data/information” (emphasis added) does not require the
insurance policyholder to personally access the insurance information and,
therefore, should not be construed so narrowly to preclude someone acting
on the insurance policyholder’s behalf. We can find nothing in the
specification indicating that access by an insurance policyholder is limited
only to direct access by the insurance policyholder and excludes indirect
access through someone acting on behalf of the insurance policyholder.
While we agree with Progressive that the claim term an “insurance
policyholder” by itself constitutes a person who owns an existing insurance
policy rather than someone acting on his or her behalf (Prel. Resp. 22-23),
the key issue here centers on the entire claim phrase “enable[s] an insurance
policyholder to access . . . insurance data/information.” Progressive
identifies two statements in the specification that purportedly support its
view that access by an insurance policyholder must mean direct access by
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the insurance policyholder without someone acting on his or her behalf. Id.
In one, the specification of the ’269 patent states that:
[t]he present invention contemplates a new and improved
insurance policy service and delivery system for
communicating changes in policy parameters to an insurer via
an Internet on-line automated system, thereby obviating
representative or agent personal involvement in the interfacing
and communicating of policy parameter changes, policy
changes and associated charge adjustments between the
customer and the insurer.
Ex. 1001, spec. 1:51-58. In the other, the specification of the ’269 patent
states that “[a]ny way the insurer can reduce personnel involvement in
addressing policyholder services is a way that can improve efficiency and
reduce costs—costs that can be eliminated to result in lower rates to a
consumer buying the insurance.” Ex. 1001, spec. 1:46-50. However, those
statements are inapposite because they pertain to allowing direct access by
an insurance policyholder without personnel involvement from the insurer
and do not prohibit indirect access through someone acting on behalf of the
insurance policyholder, e.g., an adult child acting on behalf of an elderly
parent.
B. “Information module,” “insurance policy adjustment module,”
“payment module,” “payment enablement module,” “claims information
module,” and “policy quote(s) module”

Liberty construes those claim terms to mean software associated with
the functions as named for each “module” in the corresponding claims. Pet.
13 (citing to Ex. 1001, Abstract; spec. 3:27-31, 5:44-49). Progressive does
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not challenge Liberty’s claim construction with respect to those claim terms.
Because Liberty’s claim construction is consistent with the specification of
the ’269 patent, we agree with Liberty’s claim construction.
C. “Insurance policy parameter”
Liberty construes the claim term “insurance policy parameter” to
mean any information relating to an insurance policy. Pet. 13 (citing to Ex.
1001, spec. 2:16-22, 3:35-4:44). Progressive does not challenge Liberty’s
claim construction with respect to that claim term. Because Liberty’s claim
construction is consistent with the specification of the ’269 patent, we agree
with Liberty’s claim construction.
D. “Real-time” and “in response to and at the same rate”
1. “Real-time”
Liberty construes the claim term “real-time” to mean at the same or
substantially the same time. Pet. 14 (citing to Ex. 1001, spec. 2:3-7, 3:16-
19). In response, Progressive contends that Liberty’s proposed claim
construction is unreasonable because “substantially” is a relative term that
does not provide a standard for measuring degree or scope. Prel. Resp. 23-
24. Moreover, Progressive argues that Liberty does not identify an explicit
or special definition for the claim term “real-time” in the intrinsic record
and, therefore, Liberty has not overcome the presumption that the claim term
“real-time” takes on its ordinary and customary meaning. Id. at 24.
Upon reviewing the specification, we do not find an explicit or special
definition for the claim term “real-time.” Therefore, we resort to its ordinary
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and customary meaning as would be understood by one with ordinary skill
in the art. See Phillips, 415 F.3d at 1312. Accordingly, we construe the
claim term “real-time” as “pertaining to a system or mode of operation in
which computation is performed during the actual time that an external
process occurs, in order that the computation results can be used to control,
monitor, or respond in a timely manner to the external process. Contrast:
batch. See also: conversational; interactive; interrupt; on-line.” The IEEE
Standard Dictionary of Electrical and Electronics Terms, 6th ed. (1996).
2. “In response to and at the same rate”
Our findings and determination regarding the claim term “in response
to and at the same rate” are set forth in Section IV (“Alleged Grounds of
Unpatentability as to Claims 10-12”) in this decision.
E. “Personal Security Code”
Liberty construes the claim term “personal security code” to mean
data personal to a user that provides secure access to information. Pet. 14
(citing to Ex. 1001, spec. 3:11-15, 5:11-43). In response, Progressive
contends that the Liberty’s proposed claim construction is unreasonable to
the extent that the code is personal to a user other than the insurance
policyholder. Prel. Resp. 23. However, we note that Liberty’s proposed
claim construction does not include data that is personal to a user other than
the insurance policyholder. Because Liberty’s claim construction is
consistent with the specification of the ’269 patent, we agree with Liberty’s
claim construction.
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F. “Adjustment”
Liberty construes the claim term “adjustment” to mean any change,
modification, or update. Pet. 14 (citing to Ex. 1001, spec. 1:61-2:7, 7:62-
8:17). Progressive does not challenge Liberty’s claim construction with
respect to that claim term. Because Liberty’s claim construction is
consistent with the specification of the ’269 patent, we agree with Liberty’s
claim construction.
G. “Insurance document”
Liberty construes the claim term “insurance document” to mean any
document related to an insurance policy. Pet. 14 (citing to Ex. 1001,
independent claim 1). Progressive does not challenge Liberty’s claim
construction with respect to that claim term. Because Liberty’s claim
construction is consistent with the specification of the ’269 patent, we agree
with Liberty’s claim construction.

IV. ALLEGED GROUNDS OF UNPATENTABILITY
AS TO CLAIMS 10-12
Liberty alleges that claims 10-12 are unpatentable under 35 U.S.C.
§§ 102 and 103 based on Peterson and the combination of Peterson and
Chelliah. (Pet. 15, 55, and 67.) As a step in our analysis for determining
whether Liberty’s petition has demonstrated that it is more likely than not
that claims 10-12 are unpatentable over the cited prior art, we determine the
meaning of the claims. Oakley, Inc., v. Sunglass Hut Int’l, 316 F.3d 1331,
1339 (Fed. Cir. 2003) (Both anticipation and obviousness are two step
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inquiries; the first step is to determine the scope and meaning of the claims
being challenged, and the second step in the analysis requires a comparison
of the properly construed claim to the prior art.). We also review the
specification because it is always highly relevant to the claim construction
analysis. Phillips, 415 F.3d at 1317 (The specification is the single best
guide to the meaning of a disputed term.).
Based on our claim construction analysis, we discern no reasonable
construction that can properly be adopted which would render claims 10-12
definite, and we cannot find sufficient written description for the claimed
subject matter. Because the claims fail to particularly point out and
distinctly claim an invention as required by 35 U.S.C. § 112, ¶ 2
4
, and are
not supported by the original disclosure as required by 35 U.S.C. § 112, ¶ 1,
we deny the prior art grounds of unpatentability asserted by Liberty as to
claims 10-12.
5
See In re Steele, 305 F.2d 859, 862-63 (CCPA 1962) (the
prior art grounds of unpatentability must fall, pro forma, because they are
based on speculative assumption as to the meaning of the claims).
Patent claims serve an important public notice function. See General
Elec. Co. v. Wabash Appliance Corp., 304 U.S. 364, 369 (1938). The scope

4
Section 4(c) of the AIA re-designated 35 U.S.C. § 112, ¶¶ 1 and 2, as 35
U.S.C. §§ 112(a) and (b). Because the ’269 patent has a filing date before
September 16, 2012 (effective date), we will refer to the pre-AIA version of
35 U.S.C. § 112.
5
Our decision in this regard is based solely on the indefiniteness and lack of
written description of the claimed subject matter and does not reflect on the
adequacy of the prior art evidence applied in support of the asserted grounds.
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of the claims must be sufficiently definite to inform the public of the bounds
of the protected invention, i.e., what subject matter is covered by the
exclusive rights of the patent. Halliburton Energy Servs. v. MI, LLC, 514
F.3d 1244, 1249 (Fed. Cir. 2008). The test for whether a claim meets the
definiteness requirement is whether a person of ordinary skill in the art
would have understood the scope of the claim when read in light of the
specification. Exxon Research and Engineering Co. v. United States, 265
F.3d 1371, 1375 (Fed. Cir. 2001); Personalized Media Communications v.
Int’l Trade Comm’n, 161 F.3d 696, 705 (Fed. Cir. 1998).
In this proceeding, we determine that one of ordinary skill in the art
could not have discerned the scope of claims 10-12 because the phrase “in
response to and at the same rate” as used in the claims is indefinite.
Claims 11-12 depend from claim 10. Claim 10 is representative and recites:
An on-line insurance policy service system comprising:
a browser that enables an insurance policyholder to
access remote insurance information and software linked to the
remote insurance information;
a publicly accessible network that facilitates data
transfers from the browser;
an information module remote from the browser coupled
to the publicly accessible network that identifies the insurance
policyholder and verifies an insurance policy parameter of that
insurance policyholder in response to and at the same rate
data is received from the insurance policyholder through the
publicly accessible network and the browser; and
an insurance policy adjustment module remote from the
browser coupled to the publicly accessible network that adjusts
an insurance policyholder's selected insurance policy parameter
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in response to and at the same rate second data is received
from the insurance policyholder through the publicly accessible
network and the browser;
a payment module remote from the browser coupled to
the publicly accessible network that determines a cost of the
adjustment to an insurance premium in response to the
adjustment of the insurance policyholder's selected insurance
policy parameter;
wherein the insurance policy adjustment module
communicates to the browser an acknowledgement comprising
the change in the insurance premium resulting from the
adjustment in the insurance policyholder's selected insurance
policy parameter. Emphasis added.
Liberty contends that the phrase “in response to and at the same rate”
and the term “real-time” have the same construction, namely “at the same
time or substantially the same time.” Pet. 13. We do not agree with
Liberty’s contention.
Liberty fails to explain how “rate” and “time,” which are different
measures, could have the same meaning. The term “rate” has the meaning
of “a certain amount of one thing considered in relation to a unit of another
thing”
6
(e.g., 100 Megabits per second). In contrast, “real-time” relates to
an absolute time interval and not something that is “per” unit-time or “per”
anything. A time interval or duration is not a rate. We conclude that the
phrase “in response to and at the same rate” does not have the same
meaning as “real-time.”

6
Random House Webster’s College Dictionary (2
nd
ed. 1999).
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The problem we have with the claim language is that it requires the
insurance system to identify and verify the policyholder information at the
same rate as data is received from the policyholder, and requires the
insurance system to adjust a parameter at the same rate as second data is
received from the policyholder. The claim language requires the insurance
system to perform those functions (“identifying,” “verifying,” and
“adjusting”) at the same rate as the data transfer rate of the policyholder
information sent over a public network. However, it is ambiguous which
rates as to identifying, verifying, and adjusting are compared with the data
transfer rate of a public network (e.g., the Internet and bits per second).
Possible choices range from user level rates such as “policies per day” to
computer execution level rates such as “instructions per cycle” and include
everything in between. At each level, the conceptual focus is different and
the unit rate is different, thus leading to ambiguity on which rate is to be
compared with the data transfer rate on a public network.
Even assuming that the language is merely broad and that the
processing rate at any one of the multitude of levels which can be used for
comparison with the data transfer rate of a public network, it is ambiguous
what test or standard is to be used to determine when it is the case that a
processing rate is the same as a data transfer rate. One with ordinary skill in
the art would not know whether the limitation is or is not met and thus
whether an element is or is not within the scope of the claim.
The specification contains no guidance on what processing rate at
which level and moment is to be compared to a data transfer rate, and
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provides no standard for determining when it is the case that a processing
rate is deemed to be the same as a data transfer rate. We discern no
reasonable construction that can properly be adopted which would render the
claims definite. Based on this record, a preponderance of evidence supports
the conclusion that claims 10-12 are indefinite.
We further conclude that the original disclosure of the ’269 patent
lacks written description for the subject matter of claims 10-12. See In re
Wright, 866 F.2d 422 (Fed. Cir. 1989); In re Rasmussen, 650 F.2d 1212,
1214 (CCPA 1981) (An amendment to the claims must be supported by the
original disclosure of the invention.). The test for determining compliance
with the written description requirement under 35 U.S.C. § 112, ¶ 1, is
whether the disclosure of the application as originally filed reasonably
conveys to the artisan that the inventor had possession at that time of the
later claimed subject matter. Ariad Pharm., Inc. v. Eli Lilly & Co., 598 F.3d
1336, 1351 (Fed. Cir. 2010) (en banc); In re Kaslow. 707 F.2d 1366, 1375
(Fed. Cir. 1983).
Here, none of the originally-filed claims of the ’269 patent contains
the phrase “in response to and at the same rate.” When Progressive
amended the claim
7
to overcome the Examiner’s obviousness rejection by
changing “in real-time in response to data received from the insurance
policyholder” to “in response to and at the same rate data is received from
the insurance policy holder,” Progressive did not point out the portion of the

7
Amended claim 45 was issued as claim 10 in the ’269 patent.
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specification that supports the amended claim. Application 11/580,324
Amendment filed September 1, 2010, pages 4 and 14. In fact, the
specification of the ’269 patent contains no description of the matter added
by the amendment.
The specification merely describes the invention as providing “real-
time” communications between the policyholder and the insurer’s computer
system, but nothing on data transfer rates or system performance rates.
See, e.g., ’269 patent, col. 1:62-67 (“In accordance with the present
invention, there is disclosed a method and apparatus for Internet on-line
insurance policy service and delivery for real-time automated selective
adjustment…”); col. 2:3-7 (“A policy adjustment module selectively
communicates parameter changes made by the user to the insurer’s computer
system and the computer than generates in real-time the resulting policy cost
attributable to the parameter change.”) (Emphasis added.). As we concluded
above, “in response to and at the same rate” does not have the same
meaning as “real-time.” Therefore, the specification fails to provide written
description support for the claim limitations that contain the phrase “in
response to and at the same rate.”
For the foregoing reasons, we deny the prior art grounds of
unpatentability asserted by Liberty as to claims 10-12.
8

8
In CBM2013-00002, a concurrent proceeding for the ‘269 patent, we
authorize a covered business method patent review of claims 10-12 based on
the grounds of unpatentability under 35 U.S.C. § 112, ¶ 2, as being
indefinite, and under 35 U.S.C. § 112, ¶ 1, as failing to comply with the
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V. ALLEGED GROUNDS OF UNPATENTABILITY AS TO
CLAIMS 1-9 and 13-59

A. 35 U.S.C. § 102 Ground of Unpatentability—Claims 1-9, 13-16, 24, 30-
42, 44-54, and 56-59 as Anticipated by Peterson

1. Principles of Law
“A claim is anticipated only if each and every element as set forth in
the claim is found, either expressly or inherently described, in a single prior
art reference.” Verdegaal Bros. v. Union Oil Co. of California, 814 F.2d
628, 631 (Fed. Cir. 1987).
To serve as an anticipation when the reference is silent about
the asserted inherent characteristic, such gap in the reference
may be filled with recourse to extrinsic evidence. Such
evidence must make clear that the missing descriptive matter is
necessarily present in the thing described in the reference, and
that it would be so recognized by persons of ordinary skill.

Continental Can Co. USA, Inc. v. Monsanto Co., 948 F.2d 1264, 1268 (Fed.
Cir. 1991). “Inherency, however, may not be established by probabilities or
possibilities. The mere fact that a certain thing may result from a given set
of circumstances is not sufficient.” In re Robertson, 169 F.3d 743, 745 (Fed.
Cir. 1999) (citations and internal quotation marks omitted).
2. Introduction
In the petition, all five grounds of unpatentability alleged by Liberty
are based in whole or in part on Peterson. Peterson does not expressly
describe all the claim features recited in the ’269 patent. Consequently,

written description requirement.
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Liberty relies upon the RemoteWare® press release as extrinsic evidence to
establish that certain claim features are inherently disclosed in Peterson. Pet.
18-30. The RemoteWare® press release issued on October 7, 1996. Ex.
1005, pg. 1. The RemoteWare® press release is an announcement by
XcelleNet, Inc. concerning the general commercial availability of
RemoteWare® version 3.1 software. Id. Liberty relies upon the description
of RemoteWare® version 3.1 software in the RemoteWare® press release to
show what must be necessarily present in Peterson.
3. Contentions
Liberty contends that claims 1-16, 24, 30-42, 44-54, and 56-59 are
anticipated by Peterson. Pet. 15-54. In particular, Liberty relies upon the
description of RemoteWare® version 3.1 software in the RemoteWare®
press release to confirm the inherent features of Peterson—namely a web
browser, the Internet, and webpages. Id. at 18. Based on that reliance,
Liberty argues that Peterson describes the claimed subject matter recited in
claims 1-16, 24, 30-42, 44-54, and 56-59. Id. at 19-54.
In response, Progressive contends that Liberty fails to demonstrate
that claims 1-16, 24, 30-42, 44-54, and 56-59 are anticipated by Peterson.
Prel. Resp. 26-42. In particular, Progressive argues that the description of
RemoteWare® version 3.1 software in the RemoteWare® press release
cannot be used as extrinsic evidence to confirm the inherent features of
Peterson in order to establish an anticipation rejection. Id. at 26-30.
Progressive indicates that Peterson was filed on May 31, 1996, whereas the
RemoteWare® press release was not publicly available before October 7,
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1996. Id. at 27-28. Given the four month gap between May 31, 1996, and
October 7, 1996, Progressive asserts that the RemoteWare® version 3.1
software described in the RemoteWare® press release could have been
conceived and developed after Peterson was filed and, therefore, the
contents of the RemoteWare® press release cannot be relied upon as a
description of any RemoteWare® software referred to in Peterson. Id. at 28-
29.
Further, Progressive contends that Peterson fails to disclose an
insurance policy adjustment module that adjusts the insurance policyholder’s
insurance policy parameter in real-time and in response to data received
from the insurance policyholder through the publicly accessible distributed
network, as required by independent claims 1, 13, 15, and 53. Prel. Resp. 30
(emphasis added). In particular, Progressive argues that the only difference
between Peterson’s normal scheduled connection option and the “urgent
type” connection option is what time the connection is initiated between the
portable computer and the home office. Id. at 32-33 (citing to Ex. 1004,
spec. 33:29-36.) Progressive alleges that the rest of the “urgent type”
connection option does not include any real-time or same-rate insurance
parameter adjustments at the home office while the portable computer is
connected to the home office for the initial upload. Id. at 33. Instead,
Progressive asserts that the home office computer batch processes the data
uploaded during the “urgent type” connection option the next day, and then
returns the updated data back to the portable computer the next night. Id. at
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33-34 (citing to Ex. 1004, spec. 1:66-2:8, 12:30-49). We are persuaded by
Progressive’s arguments.
4. Analysis
We begin our analysis by determining if Liberty properly relies on the
RemoteWare® press release to support its assertion that features of the
RemoteWare® version 3.1 software described in the press release are
inherently disclosed in Peterson. Peterson discloses that the communication
interface associated with the portable computer includes communication
software such as RemoteWare®. Ex. 1004, spec. 9:11-17. Peterson also
discloses that each of the server computers contained within the home office
computer array use RemoteWare® software. Ex. 1004, spec. 12:21-24. As
set forth in the Introduction section, the RemoteWare® press release
announces the commercial availability of version 3.1 of the RemoteWare®
software package. Ex. 1005, pg. 1. According to the RemoteWare® press
release, version 3.1 of the RemoteWare® software package adds
accessibility from within a web browser, lets remote users connect to the
enterprise via an Internet browser, and allows prospective users to initiate
communications sessions from within a webpage. Ex. 1005, pgs. 1-2.
Based on the cited disclosures in the RemoteWare® press release describing
version 3.1 of the RemoteWare® software package, Liberty asserts that the
RemoteWare® software referred to in Peterson necessarily includes a web
browser, the Internet, and webpages. Pet. 18.
However, Liberty does not provide any persuasive evidence or
technical reasoning indicating that the use of a web browser, the Internet,
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and webpages in the RemoteWare® version 3.1 software are necessarily
present in the RemoteWare® software referred to in Peterson. Peterson only
refers to RemoteWare® software generally and not to RemoteWare®
version 3.1 software specifically. See Ex. 1004, spec. 9:11-17; 12:21-24.
Liberty has not shown that the RemoteWare® software referred to in
Peterson is the same version of RemoteWare® software referred to in the
RemoteWare® press release, i.e., RemoteWare® version 3.1 software. The
likelihood that the RemoteWare® software referred to in Peterson may be an
earlier version of RemoteWare® software other than version 3.1 undermines
Liberty’s position on inherent disclosure in Peterson. See Robertson, 169
F.3d at 745. Therefore, we are not persuaded by Liberty’s argument that
features of the RemoteWare® version 3.1 software described in the
RemoteWare® press release are necessarily present in the RemoteWare®
software referred to in Peterson.
Second, we must determine whether Liberty’s reliance on Peterson
properly accounts for the claimed “insurance policy adjustment module”
feature and corresponding “real-time” adjustment aspect required by
independent claims 1, 13, 15, and 53. Pet. 25-27. Figure 1 of Peterson
illustrates a system that registers insurance transactions and communicates
such transactions to the home office computer of an insurance company. Ex.
1004, spec. 6:7-10. Peterson discloses that the system includes a home
office and at least one portable computer. Ex. 1004, spec. 7:50-54. Figure
17 of Peterson illustrates that the portable computer can select from three
different types of home office connections, two of those options are: (1)
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scheduled; and (2) urgent. Ex. 1004, spec. 33:4-9. Peterson discloses that
during the urgent type connection option, the portable computer immediately
establishes a connection with the home office computer without waiting for
the scheduled time. Ex. 1004, spec. 33:30-34.
Based on the aforementioned disclosure in Peterson, Liberty takes the
position that the entire urgent type connection option occurs in real-time.
Pet. 27 (citing to Ex. 1009, Klausner Dec. ¶¶ 16, 28-30, 35-38). However,
Liberty does not direct us to a specific disclosure in Peterson that expressly
describes the adjustment and processing steps that occur during the latter
half of the urgent type connection option. Liberty’s stated position also fails
to address Peterson’s disclosure that the latter half of the urgent type
connection option occurs in the same way as the scheduled manner. Ex.
1004, spec. 33:34-36.
Peterson discloses that during the scheduled type connection option
illustrated in Figure 17, the portable computer submits transaction files that
were accumulated throughout one day to the home office on a nightly basis.
Ex. 1004, spec. 33:10-20. Peterson also discloses that for the scheduled
manner of operation, the home office compiles and adjusts insurance
information received from the previously scheduled nightly submission
sometime during the following day, and transmits such processed
information back to the portable computer during the next scheduled nightly
transmission. Ex. 1004, spec. 1:66-2:8, 12:39-43.
Peterson discloses that during the urgent type connection option
illustrated in Figure 17, the portable computer immediately transmits a
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transaction file to the home office instead of holding the transaction file until
the next scheduled nightly transmission. Ex. 1004, spec. 33:30-34.
However, Peterson is not entirely clear about the adjustment and processing
steps that occur when the home office receives the transaction file in the
urgent type connection mode. Peterson only informs us that the latter half of
the urgent type connection option occurs in the same way as the scheduled
manner. Ex. 1004, spec. 33:34-36.
We do not agree with Liberty’s contention that Peterson’s urgent type
connection option necessarily entails real-time adjustment and processing of
insurance information. Liberty primarily argues that it would make no sense
for the urgent type connection option to not be conducted in real-time. Pet.
17-18. That argument is without merit because Liberty does not account for
the fact that, even without real-time adjustment and processing, the urgent
type connection option may work in a way that reduces the response time of
the home office by a whole calendar day. For instance, note the following
scenario:
(1) a transaction file may be transmitted from the portable
computer to the home office during an urgent type connection
established at 10:00am;

(2) the transaction file is then added to the collection of
transaction files transmitted during the previous scheduled
nightly transmission;

(3) sometime during the day, the transaction file received at
10:00am is processed with the collection of transaction files
received from the previous scheduled nightly transmission; and

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(4) all of the adjusted transaction files, which includes the
transaction file received at 10:00am, are transmitted back to the
portable computer during the next scheduled nightly
transmission.

In the above-described scenario, the response time for the transaction file
transmitted during the urgent type connection option is moved ahead one full
calendar day than what it would be if the transaction file were held up and
sent during the regularly scheduled nightly transmission. The corresponding
result is still achieved using batch adjustment and processing of insurance
information and does not entail real-time adjustment and processing of
insurance information.
Finally, we are not persuaded by the corresponding declaration
testimony of David Klausner. Pet. 27 (citing to Ex. 1009). In the
declaration, Mr. Klausner states:
In my opinion, Peterson would necessarily be understood by
one of ordinary skill to disclose that the ‘urgent mode’
transmission of data from the portable computer, as well as the
processing of data at the home office computer and re-
transmission back to the portable computer, all happen in real-
time. In my view, a person of ordinary skill would have
understood that the “urgent mode” connection would run
“urgently” in real-time—i.e. without waiting for the home
office computer to process the data at some later (non-urgent
and non-real-) time.

Ex. 1009, ¶ 28. First, Mr. Klausner’s testimony is conclusory because it
does not explain why one with ordinary skill in the art would have
understood that adjustment and processing of insurance information
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transmitted during the urgent type connection option must necessarily entail
real-time adjustment and processing. Second, Mr. Klausner’s testimony
does not account for the scenario described above. It is simply not the case
that Peterson’s urgent type connection option makes no sense or is illogical
unless the adjustment and processing of insurance information, once it is
received, occurs in real-time. To the contrary, based on the scenario
described above, it is more logical that adjustment and processing of the
transaction file transmitted during the urgent type connection option does
not occur in real-time because Peterson explicitly discloses that once the
transaction file is received, adjustment and processing occurs in the same
way as in the scheduled manner. Ex. 1004, spec. 33:34-36. Therefore,
based on the record before us, Peterson’s urgent type connection option does
not properly account for the claimed “insurance policy adjustment module”
feature and corresponding “real-time” adjustment aspect required by
independent claims 1, 13, 15, and 53.
For the foregoing reasons, we conclude that Liberty’s petition does
not demonstrate that it is more likely than not that independent claims 1, 13,
15, and 53 of the ’269 patent would have been anticipated by Peterson. For
the same reasons, we conclude that Liberty’s petition does not demonstrate
that it is more likely than not that claims 2-9, 14, 16, 24, 30-42, 44-52, 54,
and 56-59 of the ’269 patent would have been anticipated by Peterson.

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B. Remaining 35 U.S.C. § 103(a) Grounds of Unpatentability
Each of the remaining grounds of unpatentability alleged by Liberty is
based in whole or in part on Peterson. In our discussion of the anticipation
challenge alleged by Liberty, we determine that Liberty’s reliance on the
RemoteWare® version 3.1 software described in the RemoteWare® press
release does not establish any inherent disclosure in Peterson, and that
Peterson’s urgent type connection option does not properly account for the
claimed “insurance policy adjustment module” feature and corresponding
“real-time” adjustment aspect required by independent claims 1, 13, 15, and
53. Therefore, for those same reasons, we conclude that Liberty’s petition
does not demonstrate that it is more likely than not that: (1) claims 1-59 of
the ’269 patent would have been unpatentable over Peterson; (2) claims 10-
12, 17-29, 53, 57, and 59 of the ’269 patent would have been unpatentable
over the combination of Peterson and Chelliah; (3) claims 35, 36, and 57-59
of the ’269 patent would have been unpatentable over the combination of
Peterson and Tawil; and (4) claims 57 and 59 of the ’269 patent would have
been unpatentable over the combination of Peterson, Chelliah, and Tawil.

VI. RELATED PROCEEDING
Liberty also filed a petition requesting a covered business method
patent review of claims 1-59 of the ’269 patent in CBM2013-00002. In that
proceeding, we have authorized the institution of a covered business method
patent review for claims 1-59 based on the following grounds of
unpatentability:
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A. claims 1-9 and 13-59 as unpatentable under 35 U.S.C. § 103(a)
over NAIC;
B. claims 17-22, 29, and 54-56 as unpatentable under 35 U.S.C.
§ 103(a) over the combination of NAIC and Lockwood; and
C. claims 10-12 as unpatentable under 35 U.S.C. § 112, ¶ 2, as being
indefinite, and under 35 U.S.C. § 112, ¶ 1, as failing to comply
with the written description requirement.

VII. ORDER
It is
ORDERED that pursuant to 35 U.S.C. § 324(a) and section 18(a) of
the AIA, a covered business method patent review is hereby denied as to
claims 1-59 of the ’269 patent for the following grounds of unpatentability:
A. claims 1-16, 24, 30-42, 44-54, and 56-59 as anticipated under 35
U.S.C. § 102 by Peterson;
B. claims 1-59 as unpatentable under 35 U.S.C. § 103(a) over
Peterson;
C. claims 10-12, 17-29, 53, 57, and 59 as unpatentable under 35
U.S.C. § 103(a) over the combination of Peterson and Chelliah;
D. claims 35, 36, and 57-59 under 35 as unpatentable under U.S.C.
§ 103(a) over the combination of Peterson and Tawil;
E. claims 57 and 59 as unpatentable under 35 U.S.C. § 103(a) over
the combination of Peterson, Chelliah, and Tawil; and
FURTHER ORDERED that no trial is instituted in this proceeding.
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For PETITIONER:
J. Steven Baughman
ROPES & GRAY LLP
steven.baughman@ropesgray.com

For PATENT OWNER
James A. Collins
Joseph Hanasz
Robert Mallin
BRINKS HOFER GILSON & LIONE
jcollins@usebrinks.com
jhanasz@brinkshofer.com
rmallin@brinkshofer.com

ack