Covered Business Method Patent Review United States Patent No. 8,336,772 IN THE UNITED STATES PATENT AND TRADEMARK OFFICE Inventor: Racz et al. United States Patent No.: 8,336,772 Formerly Application No.: 13/212,047 Issue Date: December 25, 2012 Filing Date: August 17, 2011 Former Group Art Unit: 2887 Former Examiner: Thien M. Le

§ § § § § § §

Attorney Docket No.: 104677-5008-821 Customer No. 28120 Petitioner: Apple Inc.

For: Data Storage and Access Systems MAIL STOP PATENT BOARD Patent Trial and Appeal Board United States Patent and Trademark Office Post Office Box 1450 Alexandria, Virginia 22313-1450 PETITION FOR COVERED BUSINESS METHOD PATENT REVIEW OF UNITED STATES PATENT NO. 8,336,772 PURSUANT TO 35 U.S.C. § 321, 37 C.F.R. § 42.304

Covered Business Method Patent Review United States Patent No. 8,336,772

TABLE OF CONTENTS I.  II.  III. 

IV. 

INTRODUCTION....................................................................................................... 1  OVERVIEW OF FIELD OF THE CLAIMED INVENTION ......................... 6  PETITIONER HAS STANDING ............................................................................ 9  A.  The ’772 Patent Is a Covered Business Method (“CBM”) Patent ............. 9  1.  Exemplary Claim 30 Is Financial In Nature .................................... 10  2.  Claim 30 Does Not Cover A Technological Invention ................. 12  B.  Related Matters and Mandatory Notice Information; Petitioner Is a Real Party In Interest Sued for and Charged With Infringement ..................... 16  DETAILED EXPLANATION OF REASONS FOR RELIEF REQUESTED, SHOWING IT IS MORE LIKELY THAN NOT THAT AT LEAST ONE CHALLENGED CLAIM IS UNPATENTABLE ............................................... 17  A.  Claim Construction.......................................................................................... 19  B.  The Challenged Claims Are Unpatentable Under 35 U.S.C. § 101 .......... 23  1.  Claims Are Directed To Abstract Ideas ........................................... 24  2.  Claims Do Not Disclose An “Inventive Concept” That Is “Significantly More” Than An Abstract Idea .................................. 27  3.  Field Of Use Limitations Cannot Create Patent Eligibility ........... 27  4.  Generic Computer Implementation Cannot Transform Abstract Ideas Into Patent Eligible Inventions ............................... 28  5.  Functional Nature Confirms Preemption and Ineligibility ............ 32  6.  Machine-or-Transformation Test Confirms Ineligibility .............. 34  C.  The Challenged Claims Are Invalid Under § 103 ....................................... 35  1.  Overview of Stefik ............................................................................... 35  2.  Motivation to Combine Stefik with Poggio ..................................... 38  3.  Motivation to Combine Stefik with Poggio and Subler ................. 40  4.  Motivation to Combine Stefik with Poggio, Subler, and Ahmad.................................................................................................... 41  5.  Motivation to Combine Stefik with Poggio, Subler, Ahmad, and Kopp ............................................................................................... 42 

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Covered Business Method Patent Review United States Patent No. 8,336,772 Motivation to Combine Stefik with Poggio, Subler, Ahmad, and Sato ................................................................................................. 44  7.  Claims 25, 26, 30, and 32 are Obvious in Light of Stefik in view of Poggio, Subler, and Ahmad (Ground 2), Obvious in Light of Stefik in View of Poggio, Subler, Ahmad, and Kopp (Ground 3), Obvious in Light of Stefik in View of Poggio, Subler, Ahmad, and Sato (Ground 4), and Obvious in Light of Stefik in View of Poggio, Subler, Ahmad, Kopp, and Sato (Ground 5). ........................................................................... 46  CONCLUSION........................................................................................................... 80  6. 

V. 

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Covered Business Method Patent Review United States Patent No. 8,336,772

EXHIBIT LIST 1401

U.S. Patent No. 8,336,772

1402

Plaintiffs’ First Amended Complaint

1403

U.S. Patent No. 5,925,127

1404

U.S. Patent No. 5,940,805

1405

1406

Russell Housley and Jan Dolphin, “Metering: A Pre-pay Technique,” Storage and Retrieval for Image and Video Databases V, Conference Volume 3022, 527 (January 15, 1997) U.S. Patent No. 4,999,806

1407

U.S. Patent No. 5,675,734

1408

U.S. Patent No. 4,878,245

1409

File History for U.S. Patent No. 8,336,772

1410

U.S. Patent No. 7,942,317

1411

U.S. Patent No. 5,103,392

1412

U.S. Patent No. 5,530,235

1413

U.S. Patent No. 5,629,980

1414

U.S. Patent No. 5,915,019

1415

European Patent Application, Publication No. EP0809221A2

1416

International Publication No. WO 99/43136

1417

JP Patent Application Publication No. H11-164058 (translation) Eberhard von Faber, Robert Hammelrath, and Frank-Peter Heider, “The Secure Distribution of Digital Contents,” IEEE (1997) Declaration of Anthony J. Wechselberger In Support of Apple

1418

1419

iv

Covered Business Method Patent Review United States Patent No. 8,336,772

1420

Inc.’s Petition for Covered Business Method Patent Review U.S. Patent No. 8,033,458

1424

Declaration of Michael P. Duffey In Support of Apple Inc.’s Petition for Covered Business Method Patent Review Declaration of Megan F. Raymond In Support of Apple Inc.’s Petition for Covered Business Method Patent Review Claim Construction Memorandum Opinion from Smartflash LLC v. Apple Inc., No. 6:13cv447 (Dkt. 229) File History for U.S. Patent No. 8,061,598

1425

U.S. Patent No. 4,337,483

1426

U.S. Patent No. 7,725,375

1427

International Publication No. WO 95/34857

1428 1429

JP Patent Application Publication No. H10-269289 (translation) File History for U.S. Patent No. 7,942,317

1430

File History for U.S. Patent No. 8,033,458

1431

U.S. Patent No. 8,061,598

1432

U.S. Patent No. 8,118,221

1433

File History for U.S. Patent No. 8,118,221

1434

U.S. Patent No. 7,334,720

1435

File History for U.S. Patent No. 7,334,720

1436

U.S. Patent No. 5,646,992

1421 1422 1423

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Covered Business Method Patent Review United States Patent No. 8,336,772 I.

INTRODUCTION Pursuant to § 321 and Rule § 42.304,1 the undersigned, on behalf of and acting

in a representative capacity for Apple Inc. (“Petitioner”), petitions for covered business method review of claims 25, 26, 30, and 32 (“challenged claims”) of U.S. Pat. No. 8,336,772, issued to Smartflash Technologies Limited and assigned to Smartflash LLC (“Patentee”). Petitioner asserts it is more likely than not that the challenged claims are unpatentable for the reasons herein and requests review of, and judgment against, the challenged claims under §§ 101 and 103. As discussed in Sec. III.B, infra, Petitioner has concurrently filed two other CBM Petitions requesting judgment against different ’772 claims. The Director, pursuant to Rule 325(c), may determine that merger, or at minimum coordination, of these proceedings, is appropriate. Petitioner previously filed CBM2014-00110/111 seeking review of the ’772 under §§102 and 103. Those petitions were not instituted. In its Decisions Denying Institution, the Board construed “use rule” as “a rule specifying a condition under which access to content is permitted,” and determined Petitioner had not shown it was more likely than not that it would prevail in demonstrating that Stefik alone or combined with Poggio and/or Sato rendered obvious limitations related to “code to request identifier data…” and “use status data.” CBM2014-00110, Pap. 7, at 15-18; -00111,

1

All section cites herein are to 35 U.S.C. or 37 C.F.R., as context indicates, and all

emphasis herein added unless otherwise noted.

Covered Business Method Patent Review United States Patent No. 8,336,772 Pap. 7, at 15-21. In light of the Board’s decision, Petitioner now identifies additional prior art with explicit disclosures of the limitations related to “code to request identifier data…” For example, Subler discloses an end user device that provides a powerful, easy-to-use interface to browse through and analyze products available from a storage database. Ex.1436 3:46-52. The end user device software includes code that retrieves product information from the database and presents the information to the user in a windowed graphical user interface. Ex.1436 4:49-54; 5:26-30. Petitioner also identifies additional prior art—Ahmad and Kopp (Exs.1403 and 1404)—with explicit disclosures of “use rules” as construed by the Board and “use status data.” Ahmad, for example, describes a software rental system that monitors an elapsed time of use recorded by a timer or a number of uses recorded by a counter and does not permit access to the rented software if a software rental license has been exhausted (see, e.g., Ex.1403 2:62-3:18), while Kopp discloses checking recorded utilization data and denying access to a data record if a licensed extent of utilization has been exhausted (see, e.g., Ex.1404 6:41-47). Petitioner has also identified additional disclosures in Stefik and Poggio concerning these limitations, further confirming a POSA2 would have found it 2

“POSA” refers to knowledge/understanding of a person of ordinary skill in the art

as of Oct. 25, 1999, who would have at least a B.S. in E.E., C.S., or a telecommunications related field, and at least 3 yrs. industry experience including client-server data/ information distribution and management architectures. See Ex.1419 ¶¶ 25, 28 n.3.

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Covered Business Method Patent Review United States Patent No. 8,336,772 obvious and routine to implement the system disclosed by Stefik and Poggio using the expressly advantageous teachings of Subler, Ahmad, Kopp, and/or Sato, detailed in §IV.C, infra. See, e.g., Ex.1419 ¶¶ 60-67. The challenged claims merely recite basic computer systems well-known in the field of data storage and access, including a “handheld multimedia terminal for retrieving and accessing protected multimedia content” and a “data access terminal for controlling access to one or more content data items stored on a data carrier.” Ex.1401 1:24-26. Claim 30, for example, recites four rudimentary components of a data access terminal “for controlling access to one or more content data items”—(A) a user interface, (B) a data carrier interface, (C) a program store storing code implementable by a processor, and (D) a processor . . . for implementing the stored code. The recited code is similarly elementary, requesting and receiving user identifier data (D1-D2), requesting, receiving, and presenting content information (D3-D5), receiving and responding to a user selection (D6-D7), receiving and responding to payment validation data (D8-D9), receiving a second user selection (D10), and reading and evaluating use status data and use rules (D11-D12): 30. A data access terminal for controlling access to one or more content data items stored on a data carrier, the data access terminal comprising: [A] user interface; [B] a data carrier interface; [C] a program store storing code implementable by a processor; and [D] a processor coupled to the user interface, to the data carrier interface and to the program store for implementing the stored code, the code 3

Covered Business Method Patent Review United States Patent No. 8,336,772 comprising: [D1]code to request identifier data identifying one or more content data items available for retrieving; [D2] code to receive said identifier data identifying said one or more content data items available for retrieving; [D3] code to request content information pertaining to at least one of said one or more content data items identified by said identified data; [D4] code to receive said content information; [D5] code to present said content information to a user via said user interface pertaining to said identified one or more content data items available for retrieving; [D6] code to receive a first user selection selecting at least one of said one or more of said content data items available for retrieving; [D7] code responsive to said first user selection of said selected at least one content data item to transmit payment data relating to payment for said selected at least one content item for validation by a payment validation system; [D8] code to receive payment validation data defining if said payment validation system has validated payment for said selected at least one content data item; [D9] code responsive to the payment validation data to retrieve said selected at least one content data item from a data supplier and to write said retrieved at least one content data item into said data carrier; [D10] code to receive a second user selection selecting one of said one or more of said retrieved content data items to access; [D11] code to read use status data and use rules from said data carrier pertaining to said second selected one or more retrieved content data 4

Covered Business Method Patent Review United States Patent No. 8,336,772 items; and [D12] code to evaluate said use status data and use rules to determine whether access is permitted to said second selected one or more retrieved content data items. Ex.1401. But at the patent’s earliest claimed priority date, these simple elements and their combination were well known to any POSA. The patent acknowledges that the idea of providing access to data in exchange for a payment (e.g., purchase of music on a CD) was already well known. E.g., id. 5:13-16 (“the purchase outright option may be equivalent to the purchase of a compact disc (CD)”). And, the prior art was teeming with disclosures of this basic concept and its straightforward physical implementation. Further, claim 30 clearly involves no “technology” at all other than “a data access terminal,” with user and data carrier interfaces, a program store storing code, and a processor that implements the specification’s well-known steps—all conceded as well known and commonplace by the ’772, which states this “terminal comprises a general purpose computer.” E.g., id. 4:7, 16:47-52. Claim 30 recites no more than a system for requesting and retrieving content while sending payment data, receiving and responding to payment data, and controlling access to the data based on payment validation data. And the other challenged claims are nothing but variations on this simple theme, with the addition, in the challenged “handheld multimedia terminal” claims, of equally generic components (e.g., known wireless interface, non-volatile memory, and a display). 3 See, 3

Claim 25, e.g., recites a “handheld multimedia terminal,” but simply adds to claim 30

5

Covered Business Method Patent Review United States Patent No. 8,336,772 e.g., id. 12:37-40 (“physical embodiment of the system is not critical and a skilled person will understand that the terminals, data processing systems and the like can all take a variety of forms.”). Indeed, as confirmed by Alice Corp.Pty, Ltd. v. CLS Bank Int’l, 134 S. Ct. 2347 (2014)—decided after Petitioner’s original ’772 petitions—the challenged claims are also directed to patent ineligible subject matter under §101. As the Board noted previously, “the ’772 patent makes clear that the asserted novelty of the invention is not in any specific improvement of software or hardware, but in the method of controlling access to data,” CBM2014-00110, Pap. 7, at 13, and the challenged claims are directed to nothing more than the unpatentable abstract idea of paying for and controlling access to data, with at most the addition of well-known, routine and conventional features— in particular, generic computer implementation that cannot confer patentability on these patent-ineligible abstractions. E.g., Alice, 134 S. Ct. at 2359-60. Each challenged claim recites ineligible subject matter and is obvious, and is thus unpatentable. II.

OVERVIEW OF FIELD OF THE CLAIMED INVENTION By October 25, 1999, electronic sale, distribution, and content protection for

digital products was well-known to a POSA, and their combination as claimed would also have been well-known or at minimum obvious. See, e.g., Ex.1419 § V. In 1991, e.g., the requirements of a wireless interface, non-volatile memory, and a display, while specifying the user interface enables certain functions. Claim 32, which depends from claim 30, simply specifies integration with a mobile communications device. Ex.1401.

6

Covered Business Method Patent Review United States Patent No. 8,336,772 U.S. Pat. 4,999,806 disclosed a system and method for content protection and sale and distribution of digital products (e.g., software) by phone. See, e.g., Ex.1406 Abstract (“central station distributes software by telephone. . . accepts credit card information, transmits an acceptance code . . . After verifying the credit card information, the station calls the purchaser back and continues with the transaction only after receiving the acceptance code.”); 1:67-2:9 (describing “means for selling and distributing protected software using standard telephone lines,” “permit[ting] the purchaser to rent the protected software for a period of time,” and “to rent the protected software for a specific number of runs”). Ex.1406 also discloses (1) different types of access, e.g., purchase vs. rental and (2) a Control Transfer Program and a Primary Protection Program to prevent unauthorized copies. See id. Abstract; 2:65-3:23; Ex.1419 ¶ 30. In April 1992, U.S. Pat. No. 5,103,392 issued, disclosing use-based charging for digital products. See, e.g., id. Ex.1411 1:64-2:17. Ex. 1411’s emphasis on assuring permission to access a program and compensating providers underscores this existing focus in the art on digital rights management (“DRM”), over eight years before the claimed priority date. See, e,g., Ex.1419 ¶ 33. Also in 1997, Exhibit 1418 (“von Faber”) observed that “[e]lectronic commerce systems dealing with the distribution of digital contents . . . have to couple the use of the provided digital goods with a prior payment for the goods in a way which cannot be bypassed,” proposing a system where customers purchase keys required to utilize encrypted content. See, e.g., id. at 7(“The basic idea . . . is to distribute the contents in encrypted form, and to have the customer pay for the key which he needs to transform

7

Covered Business Method Patent Review United States Patent No. 8,336,772 the encrypted content in an usable form.”); id. 8; see also id. Fig. 1. Von Faber’s system can be used for a variety of known distribution and payment methods. See, e.g., id. 13 (“Different methods can be used to distribute the encrypted contents (standard techniques). . . . Different electronic payment methods can be integrated . . . . This flexibility leads to the fact that totally different authorisation methods can be integrated.”). Von Faber further addressed the known issue of payment distribution to providers. See, e.g., id. (“The system automatically divides the package price (payments) and guarantees that the money is transferred to each Content Provider.”); Ex.1419 ¶¶ 36-38. And U.S. Pat. No. 5,915,019 (“Ginter,” filed Jan. 8, 1997) issued June 1999, discloses “systems and methods for secure transaction management and electronic rights protection.” See, e.g., Ex.1414 Abstract. Ginter’s system “help[s] to ensure that information is accessed and used only in authorized ways, and maintain the integrity, availability, and/or confidentiality of the information.” See, e.g., id. Ginter’s “techniques may be used to support an all-electronic information distribution, for example, utilizing the ‘electronic highway.’” Id. Ginter discloses that the various entities of the virtual distribution environment (“VDE”) can flexibly take on any VDE roles. See, e.g., id. 255:22-23 (“All participants of VDE 100 have the innate ability to participate in any role.”); 255:23-43. Ginter thus highlights the known flexibility in such distribution systems, underscoring that combinations among disclosures of such distribution systems would have been obvious. See, e.g., Ex.1419 ¶¶ 39, 40.

8

Covered Business Method Patent Review United States Patent No. 8,336,772 Content storage and utilization on portable devices, including mobile communication devices such as cellular phones, was also well-known. As one example, Ex.1416 (“Rydbeck,” pub’d Aug. 26, 1999), discloses a cell phone for storing digital content in non-volatile memory and accessing that content. See, e.g., Ex.1416 5 (“Because of its integration into the cellular phone, the digital entertainment module can share components already present in the cellular phone. Such savings would not be available if a CD player were simply aggregated with the phone. Further, the use of solid state RAM or ROM, as opposed to disc storage, eliminates the need for bounce control circuitry[, enabling the] invention to provide cellular communications and entertainment during leisure activities.”); Ex.1419 ¶ 41. Thus, as these background examples and the additional prior art detailed below in IV.B (including the primary prior art Stefik patent) illustrate, the art was rife with discussion of the same supposed “invention” now memorialized in the challenged claims. Long before the purported priority date, disclosures abounded of the very features that Smartflash now seeks to claim as its exclusive property. As outlined below, the challenged claims are obvious. III.

PETITIONER HAS STANDING A.

The ’772 Patent Is a Covered Business Method (“CBM”) Patent

The ’772 is a CBM patent under AIA § 18(d)(1), and Petitioner certifies it is available for review under § 42.304(a). Although many claims qualify, a patent with even one CBM claim is a CBM patent. See CBM 2012-00001, Doc. 36 at 26; 77 Fed.

9

Covered Business Method Patent Review United States Patent No. 8,336,772 Reg. 48,709 (Aug. 14, 2012). This Board previously found the claim 8 satisfies the CBM requirement, CBM2014-00104, Pap. 8, 8-13. Petitioner nevertheless additionally addresses Claim 30 (quoted above) herein. 1.

Exemplary Claim 30 Is Financial In Nature

A CBM patent is “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.” AIA § 18(d)(1); 37 C.F.R. § 42.301. “[T]he definition of covered business method patent was drafted to encompass patents claiming activities that are financial in nature, incidental to a financial activity or complementary to a financial activity.’” 77 Fed. Reg. 48,734-35 (Aug. 14, 2012) (citing 157 Cong. Rec. S5432 (daily ed. Sept. 8, 2011)). “[F]inancial product or service” is to be interpreted broadly, id., and “financial . . . simply means relating to monetary matters”—it does not require any link to traditional financial industries such as banks. See, e.g., CBM2012-00001, Pap. 36 at 23. . The ’772 includes claims to a “data access terminal” (e.g., a “conventional computer” or mobile phone (Ex.1401 4:7-8)), that transmits payment data to a payment validation system for authorization and responds to payment validation data to retrieve requested content. See id. cl. 8, 30, 35; AIA § 18(d)(1); Rule § 42.301(a). The patent alleges this terminal is part of a system that allows content to be made available without fear of losing revenue, and claim 30 specifies that the terminal is “for control-

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Covered Business Method Patent Review United States Patent No. 8,336,772 ling access to one or more content data items.” Ex.1401 2:15-19; see also id. Fig 12(a)(e). More generally, the patent is about “[d]ata storage and access systems [that] enable downloading and paying for data.” Id. Abstract. “The combination of payment data and stored content data . . . helps reduce the risk of unauthorized access.” Id. And in asserting the patent, Smartflash conceded the alleged invention relates to a financial activity or transaction, stating “[t]he patents-in-suit generally cover a portable data carrier for storing data and managing access to the data via payment information and/or use status rule [and] also generally cover a computer network . . . that serves data and manages access to data by, for example, validating payment information.” Ex.1402 ¶ 17. Indeed, the specification confirms that the recited “data access terminal” is “for storing and paying for data,” (Ex.1401 1:20-22), “can communicate with a bank or other financial services provider to control payment” (id. 3:53-55), and can “validate payment with an external authority such as a bank” (id. 2:8-10). Further, “[p]ayment for the data item or items requested may either be made directly to the system owner or may be made to an e-payment system” (id. 20:59-61), and such systems may be provided “according to, for example, MONDEX, Proton, and/or Visa cash compliant standards” and “payment authentication . . . may [] be performed by, for example, a data access terminal . . . using payment management code.” Id. 13:43-64. See also id. 7:66-8:61 (esp. 8:26-28); 11:65-12:4; Fig. 12(a)-(e). Claim 30 expressly recites software to perform data processing and other operations in connection with the recited “payment validation system” thus clearly relates

11

Covered Business Method Patent Review United States Patent No. 8,336,772 to a financial activity and providing a financial service. See CBM2013-00020, Pap. 14 at 11-12 (“the electronic transfer of money is a financial activity, and allowing such a transfer amounts to providing a financial service.”). See also AIA § 18(d)(1); 37 C.F.R. § 42.301(a); 77 Fed. Reg. 48,734, 48,735 (Aug. 14, 2012) (“[T]he definition of [CBM] was drafted to encompass patents ‘claiming activities that are financial in nature, incidental to a financial activity or complementary to a financial activity.’”) (citation omitted). 4 2.

Claim 30 Does Not Cover A Technological Invention

Further, claim 30 does not cover a “technological invention” within the exception in AIA § 18(d)(1), because it does not claim “subject matter as a whole [that] recites a technological feature that is novel and unobvious over the prior art[] and solves a technical problem using a technical solution.” § 42.301(b). To the contrary, the specification explains that claim 30’s “data access terminal” was commonplace, and is not directed to a technical problem, but rather offers a non-technical solution to the business problem of data piracy. (a)

Claim 30 Does Not Recite A Technological Feature That Is Novel and Unobvious

First, no “technological feature” of claim 30 is novel and unobvious. The PTAB has confirmed that “[m]ere recitation of known technologies, such as computer hardware, communication or computer networks, software, memory, computerreadable storage medium, scanners, display devices or databases, or specialized machines, such as an ATM or point of sale device,” or “[r]eciting the use of known prior 4

Claim 8 is similarly financial in nature. See CBM2014-00110, Pap. 7, 10-12.

12

Covered Business Method Patent Review United States Patent No. 8,336,772 art technology to accomplish a process or method, even if that process or method is novel and non-obvious” will “not typically render a patent a technological invention.” See, e.g., 77 Fed. Reg. 48,764 (Aug. 14, 2012). As the PTAB further stated, “combining prior art structures to achieve a normal, expected, or predictable result of that combination” is not a technological invention. 77 Fed. Reg. 157 (Aug. 14, 2012) at 48,764. As its language makes clear, claim 30 involves no “technology” at all other than, at most, “a data access terminal,” which includes user and data carrier interfaces, a program store, and a processor. Ex.1401. “The data access terminal may be a conventional computer or, alternatively, it may be a mobile phone,” both of which were known in the art well before 2000. Id. 4:7; 16:47-52. Indeed, the specification disclaims the use of particular hardware, relying instead on conventional hardware known to a POSA: “[t]he physical embodiment of the system is not critical and a skilled person will understand that the terminals, data processing systems and the like can all take a variety of forms.” Id. 12:37-40. The “data supplier” of the claims is also not a technological component, and requires no specific hardware, see Ex.1401 6:20-22; 6:62-64, but is, instead, simply a supplier of online data. Id. 6:2-4. See also id. 6:62-64 (“The computer system is operated by a data supplier or a data supplier ‘system owner’ for providing content data to the data carrier.”); 8:16-19. The referenced data carrier is, e.g., a standard smart card. Id. 11:35. The use of software (code) for requesting and receiving identifier data identifying content data, requesting, receiving, and presenting content information, receiving

13

Covered Business Method Patent Review United States Patent No. 8,336,772 and responding to a user selection for content (including by transmitting payment data), receiving and responding to payment validation data, receiving a second user selection for content, and reading and evaluating use status data and use rules to determine access, was also exceedingly well known in the art, and could not transform the claims into a technological invention. See, e.g., 77 Fed. Reg. 48,756 48,764 (Aug. 14, 2012) (“[m]ere recitation of known technologies, such as . . . software, memory, computer-readable storage medium . . . [will] not typically render a patent a technological invention.”); Ex.1419 § V, ¶¶ 80-88. The functions performed by the code (D1-D7, D10)—related to the identification, access, presentation, selection, and control of data and content information, as disclosed in the specification—were commonplace before the earliest claimed priority date. See, e.g., Ex.1406 8:62-9:12; Ex.1401 1:40-50. Further, the sending of payment data to a payment validation system and (D7) and the financial transaction performed by the code described in elements D8 and D9 was well known, because, as the patent concedes, e-payment systems were known. Ex.1401 13:43-64 (“E-payment systems coupled to banks . . . these provide an e-payment system according to, for example, MONDEX, Proton, and/or Visa cash compliant standards . . . payment data may be validated by a data access terminal using payment management code.”). Using code to implement this transaction, as disclosed in the specification, was obvious and known. E.g,, Ex.1419 §V, ¶¶ 80-88. Providing access to content based on payment and rules (D11-D12), as claimed in the patent, was also well known. See, e.g., Exs.1407; 1406

14

Covered Business Method Patent Review United States Patent No. 8,336,772 Abstract, 1:67-2:9; 1408 Abstract, 4:27-35; 1419 §V, ¶¶ 76-78. The state of the art at the time, and the detailed prior art analysis below, further reflects claim 30 does not recite a technological feature that is novel and nonobvious. See, e.g., Section II, supra; Section IV.C, infra. Even apart from other failures to trigger the exception, for these reasons alone, claim 30 is not a technological invention. 5 (b)

Claim 30 Does Not Solve A Technical Problem Using A Technical Solution

Moreover, claim 30 does not solve a technical problem using a technical solution because there was no technical problem to begin with. While a POSA certainly would have known how to sell data over the Internet, see, e.g., Ex.1415 Fig. 7; 1:50-55; 10:4153; Ex.1419 § V, the patent nonetheless describes the “problem” it is intended to solve as the business problem of data piracy: users were downloading content (such as MP3s) without paying, and content providers were losing money. Ex.1401 1:29-33, 47-55. The solution described in claim 30—using previously-known downloading technology, and combining previously-known data access and previously-known data payment abilities—was also not “technical.” As the patent states, “[b]inding the data access and payment together allows the legitimate owners of the data to make the data available themselves over the internet without fear or loss of revenue, thus undermining the position of data pirates.” Ex.1401 2:14-19. See also id. 4:36-38. But the basic notion of coupling 5

Claim 8 similarly requires no technology other than, at most, a data terminal with a

user and data interface, a program store, and a processor, which, were all well-known.

15

Covered Business Method Patent Review United States Patent No. 8,336,772 data access to payment, 6 as claimed, is not a “technical” solution. The specification further explains this idea of linking payment with access is the crux of the patent: “[b]y combining digital rights management with content data storage using a single carrier, the stored content data becomes mobile and can be accessed anywhere while retaining control over the stored data for the data content provider or data copyright owner.” Ex.1401 5:33-37. Further, even if the solution were somehow deemed “technical” (it is not), it would not alter that there was no technical problem presented and addressed by the patent. As the PTAB stated in CBM 2012-00007, “[d]ifficulty implementing an automated or technical solution to a problem that is not technical does not transform that non-technical problem into a technical one.” Pap. 16 at 17. 7 In sum, the “invention” of claim 30 concerns no more than the non-technical idea of restricting access to content based on payment to solve the business problem of data piracy. For this reason, too, claim 30 does not claim a technological invention. B.

Related Matters and Mandatory Notice Information; Petitioner Is a Real Party In Interest Sued for and Charged With Infringement

Petitioner Apple is the real party-in-interest. Smartflash’s Case No. 6:13-cv-447, Smartflash LLC. et al. v. Apple Inc. et al., pending in E.D. Texas, asserts the ’772 against 6

Moreover, the idea of providing access to data in exchange for a payment was itself

known. See, e.g., Ex.1407; Ex.1406 Abstract, 1:67-2:9; Ex.1408 Abstract, 4:27-35. 7

The solution described in and problem presented and allegedly addressed by claim 8

is similarly non-technical. See CBM2014-00110, Pap. 7, 12-14.

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Covered Business Method Patent Review United States Patent No. 8,336,772 Petitioner. Pursuant to Rule 42.8(b)(2), the patent is also the subject of a second litigation, Smartflash LLC et al. v. Samsung et al., No.6:13-cv-448 (E.D. Tex), to which Apple is not a party. Petitioner identifies the following administrative matters, including patents to which the ’772 claims priority: App’n No. 10/111,716 (filed as No. PCT/GB00/4110); U.S. Patent Nos. 7,334,720, 7,942,317, 8,033,458, 8,061,598, and 8,118,221.8 Petitioner previously filed two CBM petitions on this patent, CBM201400110/111, on §§102 and 103 grounds. Those petitions were not instituted. CBM2014-00110/111, Pap. 8. Petitioner previously filed CBM petitions on the following related patents: 8,118,221; 7,334,720; 8,033,458; 8,061,598; 7,942,317 (CBM2014-00102-109/112/113). The following petitions were instituted: CBM201400102/103/106-109/112/113. More recently, petitioner filed additional CBM petitions on those patents: CBM2015-00015-18/28/29. Lead and backup counsel, and service information are in the signature block. IV.

DETAILED EXPLANATION OF REASONS FOR RELIEF REQUESTED, SHOWING IT IS MORE LIKELY THAN NOT THAT AT LEAST ONE CHALLENGED CLAIM IS UNPATENTABLE Pursuant to §§ 42.22, 42.208, and 42.304(b), a full statement of the reasons for

the relief requested, including a detailed explanation of the evidence and governing 8

Petitioner has contemporaneously filed additional Petitions seeking CBM review of

this patent. Samsung filed CBM petitions on this and the related ’221, ’458, ’598, and ’720 patents (CBM2014-00200/204/192/197/193/198/194/199/190/196).

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Covered Business Method Patent Review United States Patent No. 8,336,772 law, rules and precedent is provided below. IV.A explains the bases for Petitioner’s relevant claim constructions. IV.B and IV.C provide a detailed explanation why it is more likely than not that each challenged claim is unpatentable under §§101 and 103, respectively. In particular, claims 25, 26, 30, and 32 are not drawn to patentable subject matter under 35 U.S.C. § 101 (Ground 1), obvious in light of Stefik in view of Poggio, Subler, and Ahmad (Ground 2), obvious in light of Stefik in view of Poggio, Subler, Ahmad, and Kopp (Ground 3), obvious in light of Stefik in view of Poggio, Subler, Ahmad, and Sato (Ground 4), and obvious in light of Stefik in view of Poggio, Subler, Ahmad, Kopp, and Sato (Ground 5). Lest Patent Owner argue, as suggested in a recent call with the Board regarding related CBM challenges (e.g., CBM2014-00015), that the Board should deny review under § 325(d) without regard to this petition’s merits in light of several recent decisions of the Board concerning IPRs–which are limited by statute in ways that CBMs are not, see, e.g., § 315(b) (barring IPRs after 1 year from service of infringement complaint except in the case of joinder of another petition); compare §315(e)(2) (IPR litigation estoppel for arguments “petitioner raised or reasonably could have raised”), with AIA § 18(a)(1)(D) (CBM litigation estoppel only for arguments “petitioner raised”)–Petitioner notes that this Petition does not raise substantially the same arguments or prior art as the original petitions. This petition, e.g., raises §101 arguments relying on the Alice de-

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Covered Business Method Patent Review United States Patent No. 8,336,772 cision post-dating the original petitions,9 which raised no §101 arguments, and presents new prior art with explicit disclosure of limitations the Board construed and found absent from the previously-cited art. See, e.g., CBM2013-00009, Pap. 10 at 20-21 (rejecting argument under § 325(d) that cited art was “substantially the same” as art previously before PTO where “recognition” of principle in newly-cited reference was “not expressed so clearly in [earlier considered] references”). Further, as such IPR-related decisions have underscored, the Board exercises its § 325(d) discretion on a “case-by-case basis” based on the “specific facts,” and Petitioner respectfully submits both that the demonstration herein of the unpatentability of actively-litigated claims that should never have issued is a worthwhile subject for the Board’s consideration, e.g., Ultramercial, 2014 WL 5904902, at *9 (Mayer, J., concurring) (public “protect[ed]” by “weeding out” invalid patents), and that the facts here are distinguishable from those in Unilever and Conopco. Cf., e.g., IPR2014-00506 (“Unilever”), Pap. 17 at 2, 7 (exercising discretion to deny institution “[b]ased on the specific facts presented,” including, e.g., “unsuccessful Request for Rehearing,” substituting the same argument of newly-cited art “in lieu of” originallyargued art, and “essentially . . . identical” claim charts not referring to a newly-cited reference). A. 9

Claim Construction

See, e.g., Ultramercial, Inc. v. Hulu, LLC, -- F.3d --, No. 2010-1544, 2014 WL 5904902,

at *2 (Fed. Cir. Nov. 14, 2014) (holding patent ineligible under § 101 based on principles “made clear” in Alice after having previously held patent eligible under §101).

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Covered Business Method Patent Review United States Patent No. 8,336,772 Pursuant to § 42.300(b), and solely for purposes of this review, Petitioner construes the claims such that terms are given their broadest reasonable interpretation (“BRI”). For terms not specifically construed below, and in the absence, to date, of detailed arguments from Smartflash indicating a particular need for construction under the standard applicable here, Petitioner interprets them for this review in accordance with their plain and ordinary meaning under the required BRI consistent with the specification. Because the claim construction standard at the PTO is different than that used in litigation, see In re Am. Acad. of Sci. Tech Ctr., 367 F.3d 1359, 1364, 1369 (Fed. Cir. 2004); MPEP § 2111, Petitioner reserves the right to argue in litigation a different construction for any term, as appropriate to that proceeding. Accordingly, Petitioner proposes the following constructions relevant to this proceeding:

-“payment data” (Cls. 25, 26, 30, 32)—For review purposes, this term is construed to mean “data representing payment made for requested content data” and is distinct from “access control data.” See, e.g., Ex.1401 Abstract, 5:37-42, 6:54-57, 6:64-7:1, 7:6164, 8:35-38, 9:9-11, 10:12-15, 32-36, 45-47, 14:52-56, 17:58-62, 21:4-8, 23:35-40.

-“use rules” (Cl. 25) —For review purposes, construed to mean “rule[s] specifying a condition under which access to content is permitted.” See, e.g., Ex.1401 at 6:37-39; 9:16-18; 22:4-9. See CBM2014-00108/109, Pap. 8 at 7 (construing same).10 10

Petitioner construed this term in the litigation as “rule, associated with a separately

stored content data item, indicating permissible use of the content data item,” The

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Covered Business Method Patent Review United States Patent No. 8,336,772 “Payment data” is the only term from the challenged claims that, in the litigation, patentee asserted required any construction, let alone a narrowing one. Though Petitioner believes construction of other terms will be relevant to its district court defenses (e.g., noninfringement), Petitioner does not believe that construction of other terms will be relevant to the patentability challenges here, for two reasons. First, the prior art Petitioner relies upon falls indisputably within the scope of the challenged claims, even though Petitioner’s litigation defenses will likely trigger disputes regarding the outer perimeters of such claims. For example, Petitioner proposed a construction in the district court that required a “data carrier” to, inter alia, be limited to a memory “card,” but such construction is not relevant here because the prior art cited herein discloses memory “cards,” which are indisputably within the scope of the term “data carrier.” See, e.g., Ex.1401 Fig. 2, 4:36-38, 6:13-19, 10:66, 11:51-55, 14:6-8, 18:44-46, 22:33-35. Second, as Patentee seeks no construction in litigation, let alone a narrowing one, of any term other than “payment data,” Patentee should not be heard to contend here that under the broader BRI standard, a narrow-

ing construction is required for other terms. If Patentee argues construction of additional terms, those questions of law can be addressed then. Petitioner has also argued in court that certain elements are “means-plusDistrict Court has declined to construe the term, saying that it should be given its plain and ordinary meaning. Ex.1423 at 25-26.

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Covered Business Method Patent Review United States Patent No. 8,336,772 function” (“m+f”) under 35 U.S.C. §112(f). Petitioner has argued, e.g., that claims reciting a “processor [] for implementing [] code [] comprising code to [perform a function]” use functional language without providing sufficient structure and should therefore be governed by §112(f). See Noah Sys. Inc. v. Intuit Inc., 675 F.3d 1302, 1318 (Fed. Cir. 2012) (algorithm requirement is necessary “[b]ecause general purpose computers can be programmed to perform very different tasks in very different ways” (quoting Aristocrat Techs. Austrl. PTY Ltd. v. Int’l Game Tech., 521 F.3d 1328, 1333 (Fed. Cir. 2008)); the Federal Circuit “imposed the algorithm requirement to prevent purely functional claiming when a patentee employs a special purpose computer-implemented meansplus-function limitation.”). However, Petitioner does not propose a m+f construction of these terms under BRI because (1) these terms do not contain the phrase “means for,” and the PTO has indicated that, while “giv[ing] claims their broadest reasonable interpretation, in light of and consistent with the written description of the invention in the application,” it applies a “strong presumption” that they are not “means-plusfunction” (see, e.g., MPEP §2818(I));11 and (2) even under the narrower claim construction standard applicable in district court, Patentee itself argues these are not m+f elements. Moreover, even if these were construed under BRI to be m+f limited to the 11

In addition, while construction at the Board is based on BRI in light of the specifi-

cation, district courts may rely on extrinsic evidence (e.g., dictionaries, treatises, expert testimony, etc.) to find a given term is a “nonce” word synonymous with “means.”

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Covered Business Method Patent Review United States Patent No. 8,336,772 disclosed algorithms in the specification, the cited art (and claim charts herein) discloses structures or equivalents that would render unpatentable the challenged claims. B.

The Challenged Claims Are Unpatentable Under 35 U.S.C. § 101

The challenged claims are unpatentable under §101 because they are directed to ineligible subject matter—in particular, the abstract idea of paying for and controlling access to data/content. A claim is unpatentable under §101 if it attempts to claim laws of nature, natural phenomena, or abstract ideas. See, e.g., Mayo Collaborative Servs. v. Prometheus Labs, 132 S. Ct. 1289, 1293 (2012); Bilski v. Kappos, 130 S. Ct. 3218, 3225 (2010); Alice, 134 S. Ct. at 2354. In its recent decision in Alice, id. at 2355, Mayo’s twopart framework was applied to “distinguish[] patents that claim laws of nature, natural phenomena, and abstract ideas from those that claim patent-eligible applications of these concepts.” Step one is to determine whether a claim is directed to one of these ineligible categories, and two is to determine whether additional elements transform the claims such that the combination is “sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the [ineligible concept] itself.’”Id. (quoting 132 S. Ct. at 1294). Merely adding “well-understood, routine, conventional activity previously engaged in” by those in the field is not sufficient in normal circumstances. E.g., Mayo, 132 S.Ct. at 1297-98. Thus, for example, “[s]imply implementing a mathematical principle on a physical machine, namely a computer, [is] not a patentable application of that principle.” Id. at 1301 (citations omitted);

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Covered Business Method Patent Review United States Patent No. 8,336,772 Gottschalk v. Benson, 409 U.S. 63, 73 (1972) (“storing [in a] shift register” was unpatentable abstract idea). Applying this two-step test makes clear, as a matter of law, that the challenged claims are directed to subject matter outside §101 – they are precisely the type of claims repeatedly found to be patent ineligible. 1.

Claims Are Directed To Abstract Ideas

The “abstract ideas” category of ineligible subject matter is grounded in the “longstanding rule that an idea of itself is not patentable.” Alice, 134 S.Ct. at 2355. Abstract ideas include “fundamental economic practice[s] long prevalent in our system of commerce,” “building block[s] of the modern economy,” and other “method[s] of organizing human activity.” E.g., Bilski v. Kappos, 130 S. Ct. 3218, 3231 (2010); Alice, 134 S. Ct. at 2356. Accordingly, concepts such as intermediated settlement, protecting against risk, and monitoring operating conditions for “alarm limits” are examples of patent ineligible abstract ideas. Id. at 2355-57; Bilski, 130 S. Ct. at 3225-31; Parker v. Flook, 98 S. Ct. 2522, 2525-29 (1978). Claims to “long-familiar commercial transactions” and relationships (i.e., business methods), no matter how “narrow” or “particular,” are directed to abstract ideas as a matter of law. buySAFE Inc. v. Google, Inc., 765 F.3d 1350, 1353-54 (Fed. Cir. 2014); CBM2013-00014, Pap. 33, at 13 (“the concept of advancing funds based on future retirement payments is an economic practice long prevalent in our system of commerce and squarely within the realm of abstract ideas”); CBM201300013, Pap. 61, at 16 (invalidating claim reciting “an abstract method, i.e., performing a

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Covered Business Method Patent Review United States Patent No. 8,336,772 real-time Web transaction by displaying and providing at least one application a user selects to access checking and savings accounts, and transferring funds (i.e., debiting or crediting) in response to user signals from an input device”). Further, even “the addition of merely novel or non-routine components to the claimed idea” does not “necessarily turn[] an abstraction into something concrete.” Ultramercial, 2014 WL 5904902, at *4 (invalidating claims directed to the abstract idea of “using advertising as an exchange or currency” for media content on the Internet). Here, there have been no such additions. Each challenged claim is drawn on its face to the concepts of payment and controlling access to something. Indeed, as the Board concluded previously, “the ’772 patent makes clear that the asserted novelty of the invention is not in any specific improvement of software or hardware, but in the method of controlling access to data.” CBM2014-00110, Pap. 7, at 13. Claims 25, 26, 30, and 32 are drawn to the concepts of payment and controlling access and recite “code to” request, receive, and retrieve identifier data, request, receive, and present content information, receive and respond to a user selection of content, receive and respond to payment validation data, read, evaluate, and write use status data and/or use rules, and read payment data. Indeed, every challenged claim expressly recites “payment data” and responding to payment validation data by retrieving and storing data/content; the ’772’s abstract describes “paying” and “controlling access” (Ex.1401 Abstract); and the specification states that the “invention” relates to “paying” and “providing access” (id. 1:25-26). There can be

25

Covered Business Method Patent Review United States Patent No. 8,336,772 no dispute that these concepts are at the heart of the challenged claims. But those concepts—payment and controlling access—are even older and more commonplace than those found ineligible in Alice, Bilksi, and Flook. The concept of payment is a “fundamental economic practice” that was “prevalent in our system of commerce” long before the concept of “intermediated settlement” that the Supreme Court found to be “squarely within the realm of abstract ideas.” See Alice, 134 S. Ct. at 2356-57. And the concept of controlling access based on payment (e.g., monthly access to an apartment based on the payment of rent, a two-day movie rental from Blockbuster, etc.) or based on some other criteria (e.g., access to liquor based on proof of age, access to an airport based on proof of identity and compliance with security rules, etc.) is a similarly well-known “building block of the modern economy” and a longstanding “method of organizing human activity” long pre-dating the ’772. See Alice, 134 S. Ct. at 2356-57; e.g., Ex.1419 ¶¶76-78; Ex.1408 4:27-35; Ex.1425 Abstract; Ex.1416 Abstract, Fig. 1. And, even if the ’772’s use of well-known concepts had been new, that addition would not transform the challenged claims into patentable subject matter. See, e.g., Ultramercial, 2014 WL 5904902, at *4. It is thus indisputable that the concepts of payment and controlling access are abstract ideas outside the scope of §101, and, as a legal matter, the first step of the patent ineligibility test is met by the challenged claims. buySAFE, 765 F.3d at 1353-54; Ultramercial, 2014 WL 5904902, at *4-5 (claim with steps of “restricting public access to . . . media” and

26

Covered Business Method Patent Review United States Patent No. 8,336,772 “allowing the consumer access to the media” if conditions are met “recites an abstraction”); see also DealerTrack, Inc. v. Huber et al., 674 F.3d 1315, 1333 (Fed. Cir. 2012). 2.

Claims Do Not Disclose An “Inventive Concept” That Is “Significantly More” Than An Abstract Idea

Because the challenged claims are drawn to abstract ideas, the “additional features” recited in those claims must be analyzed to determine whether they add an “inventive concept” that is “significantly more” than the claimed ideas. Alice, 134 S. Ct. at 2355. But the “additional features” recited in the challenged claims do not. Instead, they fall into two categories—field of use limitations and generic computer implementations—repeatedly found insufficient to bring a patent claim within § 101 eligibility. E.g., id. at 2358-60. Because the challenged claims are directed only to an abstract idea with nothing more than “well-understood, routine, conventional activity” added (Mayo, 132 S. Ct. at 1294) they are unpatentable. 3.

Field Of Use Limitations Cannot Create Patent Eligibility

The prohibition against patenting abstract ideas cannot be circumvented by limiting claims to a “particular technological environment” or “single field of use.” Bilski, 130 S. Ct. at 3230. The idea of “hedging,” for example, does not become patentable when “applied to commodities in the energy market,” and the idea of “automatic monitoring/alarming” does not become patentable when limited to “a catalytic conversion process.” Bilski, 130 S. Ct. at 3230-31; Flook, 98 S. Ct. at 2523, 2528-29; see also Ultramercial, 2014 WL 5904902, at *5 (“Narrowing abstract idea of 27

Covered Business Method Patent Review United States Patent No. 8,336,772 using advertising as a currency to the Internet…is insufficient to save a claim.”). Here, the challenged claims purport to limit the idea of payment to payment relating to multimedia content/data and the idea of controlling access to content/data based on “payment data” and “payment validation data.” But these ideas of “payment” and controlling access remain patent ineligible even when applied to content (or to the examples of a video, song, or game, Ex.1401 1:12-14). E.g., Bilski, 130 S. Ct. at 3230-31; Flook, 98 S. Ct. at 2528-29; see also, e.g., Ex.1419 ¶ 79. 4.

Generic Computer Implementation Cannot Transform Abstract Ideas Into Patent Eligible Inventions

Whether viewed separately or as an ordered combination, the challenged claims simply recite the concepts of paying for and controlling access to data “as performed by a generic computer,” without disclosing any “novel or unusual” improvement to “the functioning of the computer itself” or any “advance in computer technology that makes the performance of [routine] functions more effective.” Alice, 134 S. Ct. at 2358-60. As such, the claims do not supply an “inventive concept in the physical realm of things and acts”—i.e., a technological innovation. Alice, 134 S. Ct. at 2359-60; buySAFE, 765 F.3d at 1353. The claims are thus unpatentable. E.g., Alice, 134 S. Ct. at 2359-60; buySAFE, 765 F.3d at 1354-55. Indeed, “recitation of a generic computer cannot transform a patent-ineligible abstract idea into a patent-eligible invention.” Alice, 134 S. Ct. at 2358. “Given the ubiquity of computers . . . wholly generic computer implementation is not generally the sort of ‘additional feature’ that provides any ‘practical assurance

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Covered Business Method Patent Review United States Patent No. 8,336,772 that the process is more than a drafting effort designed to monopolize the abstract idea itself’” “[s]tating an abstract idea while adding the words ‘apply it with a computer’” is not patent-eligible subject matter. Id. at 2358. But that is all the challenged claims do. The challenged claims simply instruct that the abstract ideas of payment for controlling access to data should be implemented in software and refer only to generic computer functions, such as requesting, receiving, reading, retrieving, communicating, writing, selecting, accessing, transmitting, displaying, identifying, and storing. See also, e.g., Ex.1419 ¶¶ 80-88.

“[A]ll of these computer functions are well-understood,

routine, conventional activities previously known in the industry.” Alice, 134 S. Ct. at 2359; Mayo, 132 S. Ct. at 1294; see also buySAFE, 765 F.3d at 1355 (“sending” and “receiving” data over a network “is not even arguably inventive”; affirming invalidity under § 101); SAP Am., Inc. v. Versata Dev. Grp., Inc., CBM2012-00001, Pap. 70 at 30 (June 11, 2013) (directed to an abstract idea must recite more than “generic general purpose computer hardware (processor, memory, storage)” to satisfy § 101). As a matter of law, such “generic computer functions” are not “enough” to “transform” an “abstract idea into a patentable invention.” Alice, 134 S. Ct. at 2359; buySAFE, 765 F.3d at 1355; Planet Bingo, LLC v. VKGS, LLC, 576 F. App’x 1005 (Fed. Cir. 2014) (holding computerized system unpatentable because nature of the function performed by the computer at each step is “purely conventional”). Indeed, more complex computer operations than those at issue here—including “creat[ing]

29

Covered Business Method Patent Review United States Patent No. 8,336,772 electronic records,” “track[ing] multiple transactions,” “issu[ing] simultaneous instructions,” and “selectively forwarding [] credit application data”—have been found sufficiently “mundane” that they cannot bring a patent claim within the scope of §101. Alice, 134 S. Ct. at 2350, 2359; DealerTrack, 674 F.3d at 1331-34; see also Ultramercial, 2014 WL 5904902, at *4-5 (routine, conventional activities, such as “selecting an ad,” “restricting public access,” “facilitating display,” “allowing the consumer access,” “updating the activity log,” and “receiving payment,” add no inventive concept; “that the system is active . . . and restricts public access also represents only insignificant pre-solution activity”) (internal quotations omitted); Bancorp Servs., L.L.C. v. Sun Life Assurance Co. of Canada, 687 F.3d 1266, 1279 (“Using a computer to accelerate an ineligible mental process does not make that process patent-eligible.”); Walker Digital, LLC v. Google, Inc., No. 1:11-cv-00318, 2014 WL 4365245, at *6 (D. Del. Sept. 3, 2014). Moreover, even if “some of the…steps were not previously employed in this art [that would] not [be] enough—standing alone—to confer patent eligibility upon the claims at issue.” Ultramercial, 2014 WL 5904902, at *5. Similarly, the generic components recited in the challenged claims—such as “data carrier” (under its BRI12 ), “ memory,” “program 12

As noted in section IV.A, although Petitioner believes a narrower definition

should apply in litigation, Patent Owner took the position in district court that “data carrier” requires no construction even under the narrower standard applicable there, and obtained a broad construction in court construing the term to mean any “medium

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Covered Business Method Patent Review United States Patent No. 8,336,772 store,” “processor,” “code,” “interface,” and “display”—are “purely functional and generic.” See Alice, 134 S. Ct. at 2360; see also, e.g., Ex.1419 ¶¶ 80-88. Because these components are well-known features of a general purpose computer, these limitations cannot transform the challenged claims into patent eligible subject matter.13 See id. As a matter of law, a “handful of generic computer components” configured to implement an abstract idea is not patentable. Id.; see also SmartGene, Inc. v. Adv. Biological Labs., 555 F. App’x 950, 955 (Fed. Cir. 2014) (“claim does not purport to identify new computer hardware: It assumes the availability of physical components for input, memory, look-up, comparison, and output.”). Indeed, in this way, the challenged here are analogous to those invalidated in Alice, where the Court looked at the difference between the claimed abstract idea and claimed subject matter and found unpatentable, e.g., a “data processing system” comprising a “communications controller,” a “first party device coupled to said communications controller,” a “data storage unit having stored therein” two specific types of data, and a “computer, coupled to said data storage unit and said communications controller” that was “configured to,” among other things, “receive” data from certain hardware, “electronically adjust” data after “ensuring” certain rules capable of storing information.” Ex.1423 at 22. 13

A “data processing system,” a “communications controller,” a “device coupled to

said communications controller,” and a “data storage unit” are the types of “generic computer components” insufficient to bring a claim within § 101. Alice, 134 S. Ct. at 2360.

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Covered Business Method Patent Review United States Patent No. 8,336,772 are satisfied, and “generating an instruction” for further action based on the data received. Ex.1426, cl. 26. Similarly here, the difference between the claimed abstract idea and the claimed subject matter consists of, e.g., a “data access terminal for retrieving a content data item from a data supplier” that “request[s],” receiv[es],” “transmit[s],” “retrieve[s],” and “write[s].” Ex.1401, cl. 19. Any purported hardware is “purely functional and generic.” Alice, 134 S. Ct. at 2360. See Ex.1419 ¶¶ 80-88. And the functions performed by such hardware in both cases are “the most basic functions of a computer.” Alice, 134 S. Ct. at 2359. Reciting a “handful of generic computer components configured to” implement an abstract idea using “wellunderstood, routine, conventional” computer functions “is not ‘enough’ to transform an abstract idea into a patent-eligible invention.” Id. And these additional recitations add to the claims’ abstract ideas nothing more than “well-understood, routine, conventional activity,” see Mayo, 132 S. Ct. at 1294. Ex.1419 ¶¶ 80-88. 5.

Functional Nature Confirms Preemption and Ineligibility

The inquiry into “preemption” concerns in the patent eligibility context is a relative one—whether claims have the potential to foreclose future innovation disproportionately “relative to the contribution of the inventor.” Mayo, 132 S. Ct. at 1303; I/P Engine, Inc. v. AOL Inc., 576 F. App’x 982, 994 (Fed. Cir. 2014) (concurring) (noting that, “[i]n assessing patent eligibility, ‘the underlying functional concern is a relative one: how much future innovation is foreclosed relative to the contribution of the inventor’”) (quoting Mayo, 132 S. Ct. at 1303); see also Walker Digital, 2014 WL 4365245, at *3 n.2 (“the 32

Covered Business Method Patent Review United States Patent No. 8,336,772 inquiry on preemption is not whether patents directed at building blocks of human ingenuity would preempt an entire field but, instead, whether such patents would risk disproportionately tying up the use of the underlying ideas.”) (emphasis in original). Here, challenged claims’ broad functional nature firmly triggers preemption concerns. Indeed, the “code to” functional claiming of the challenged claims epitomizes “preemption” in the software context. See I/P Engine, 576 F. App’x at 994 (need for specificity to cabin scope “is particularly acute in the software arena, where claims tend to be exceedingly broad . . . and innovation often occurs despite the availability of patent protection rather than because of it”). Just like the software claims recently found invalid in Alice, here “the function performed by the computer at each step of the process is ‘[p]urely conventional.’” Alice, 134 S. Ct., at 2359 (internal citation omitted). In this case, all that is disclosed is the ultimate objective—software to implement the steps of paying for and/or accessing content/data—and this is exactly the type of functional claiming the Courts find has the potential to foreclose future innovation disproportionately “relative to the contribution of the inventor.’”14 Mayo, 132 S. Ct. at 1303; see 14

Lest Smartflash suggest that its claims cannot be invalid under § 101 unless they

wholly preempt all forms of “providing or controlling access to content,” this is an invitation to error: the Supreme Court has explicitly rejected preemption of “an entire field” as the test for eligibility. E.g., Alice, 134 S. Ct. at 2358 (noting Court had already “rejected the argument that implementing a principle in some specific fashion will

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Covered Business Method Patent Review United States Patent No. 8,336,772 I/P Engine, 576 F. App’x at 994-95. See also Walker Digital, 2014 WL 4365245, at *6 (“[claim] would disproportionately risk preempting a building block of human interaction, retarding rather than promoting progress, contrary to the very purpose [of] patents”). 6.

Machine-or-Transformation Test Confirms Ineligibility

Finally, to the extent it remains “an important and useful clue” for determining whether an invention is patent-eligible, Bilski, 130 S. Ct. at 3226, the challenged claims fail the machine or transformation test as well. A general purpose computer fails to qualify as a “particular machine” under the machine prong. DealerTrack, 674 F.3d at 1332-34; see also Ex.1419 ¶¶ 89-93, and none of the challenged claims transforms any article into a different state or thing under the transformation prong: from the face of the challenged claims, it is apparent that content data, payment data, rules, and other data are merely requested, received, retrieved, communicated, written, accessed, selected, transmitted, displayed, identified, and/or stored—not altered. Bilski, 130 S. Ct. at 3226; Ultramercial, 2014 WL 5904902, at *6 (holding that claims directed to “the automatically fall within the patentable subject matter of Section 101”); Bilski, 130 S. Ct. at 3231 (limiting abstract idea to “one field of use or adding token postsolution components” did not make it patentable). The proper, relative “preemption” inquiry is clearly satisfied here, where the subject matter of the claims simply recites “code to” perform certain abstract objectives on generic computers—a “[p]urely conventional” manner of achieving those objectives. E.g., Alice, 134 S. Ct. at 2359.

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Covered Business Method Patent Review United States Patent No. 8,336,772 grant of permission and viewing of advertisement by the consumer, the grant of access by the content provider, and the exchange of money between the sponsor and the content provider” fail to satisfy transformation prong). See also Ex.1419 ¶¶ 94-96. Thus, every possible legally viable analysis confirms their failure under § 101. C.

The Challenged Claims Are Invalid Under § 103 1.

Overview of Stefik

U.S. Pat. No. 5,530,235 (“Stefik ’235,” filed Feb. 16, 1995, issued June 25, 1996), incorporates by reference U.S. Pat. No. 5,629,980 (“Stefik ’980,” filed Nov. 23, 1994, issued May 13, 1997) (collectively, “Stefik”). 15 See Ex.1412 2:47-52 (“currently preferred embodiment of a DocuCard is an instance of a repository, as defined in copending application... is herein incorporated by reference.”). Because both Stefik patents published more than one year before any possible effective filing date of the ’772’s application, each is prior art satisfying AIA § 18(a)(1)(C). Stefik discloses “[a] Document

15

Because Stefik ’235 incorporates Stefik ’980 by reference, they should be considered

a single reference. For clarity in citation, however, separate citations are provided to Stefik ’235 and ’980 (Exs.1412 and 1413). To the extent Stefik ’235 and ’980 are argued to be separate references, there is explicit motivation to implement the repository disclosed by Stefik ’980 using the DocuCard of Stefik ’235. See, e.g., Ex.1412 2:47-52; Ex.1413 16:56-58 (“For example, the repository could be embedded in a ‘card’ that is inserted into an available slot in a computer system.”); Ex.1419 ¶¶ 53, n.4, 55.

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Covered Business Method Patent Review United States Patent No. 8,336,772 Card (DocuCard) for storing documents and which is content revealing. The DocuCard is a transportable unit having a nonvolatile storage means for storing information in a digital form, a control processor for processing user initiated functions; an I/O port for interfacing to external devices for reading and writing digital information, and a user interface for allowing a user to directly interact with the DocuCard.” See, e.g., Ex.1412 Abstract; see also, e.g., Ex.1413 Abstract; Ex.1419 ¶¶ 53-54. Stefik discloses a broader framework within which the DocuCard is used, including content protection with “usage rights.” See, e.g., Ex.1412 Abstract; Ex.1413 Abstract (“Usage rights are granted by the ‘owner’ of a digital work to ‘buyers’ of the digital work. The usage rights define how a digital work may be used and further distributed by the buyer.”). Digital works are stored in a “repository” that processes requests to perform an action—including utilizing (viewing, executing, or printing) or transporting (copying, borrowing, or transferring) content—and evaluates usage rights to determine whether the requested action is permitted. See, e.g., id. Abstract (“Digital works are stored in a repository[, which] will process each request to access a digital work by examining the corresponding usage rights . . . Access to digital works for the purposes of transporting between repositories (e.g., copying, borrowing or transfer) is carried out using a digital work transport protocol [and] for the purposes of replay by a digital work playback device (e.g. printing, displaying or executing) . . . using a digital work playback protocol.”); Ex.1419 ¶ 54. Stefik discloses, or at a minimum renders obvious, many limitations of the chal-

36

Covered Business Method Patent Review United States Patent No. 8,336,772 lenged claims, as described below. See, e.g., Ex.1419 ¶ 56, Apx D. For example, Claim 30 is directed to a “data access terminal for controlling access to one or more content data items stored on a data carrier…” See Ex.1401. Stefik discloses repositories (“data access terminals”) that control use of data stored both locally and at remote repositories (“controlling access to one or more content data items stored on a data carrier”). A requesting repository retrieves data and performs a user-requested function from a supplying repository. See Ex.1413 Fig. 18. Stefik also discloses storing data on a removable card (“data carrier”). Stefik discloses attaching usage rights to data stored in a repository. Id. 11:33-44. The usage rights indicate the type and status of rights associated with the stored data. Id. 10:19-35. The rights, and restrictions on the rights, define how a work may be used and distributed by a user. Id. Abstract. For example, right restrictions specify time conditions, copy count conditions, and security level conditions. Id. 19:21-26. In one embodiment, the default settings are a copy count of 1, no time limit on use, no access or security tests, and no fee required. Id. 19:26-32. Each right restriction changes the default to restrict the manner of use of the associated digital work, for example by limiting the number of copies made and used or the length of time during which playback of the digital work is accessible. Id. 21:15-24; 21:45-22:30. See also, e.g., Ex.1419 ¶ 57. Stefik also discloses repositories carrying out transactions with credit servers and billing clearinghouses (“payment validation systems”) via encrypted transmissions

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Covered Business Method Patent Review United States Patent No. 8,336,772 of billing and credit information (“payment data”). Stefik discloses periodic updating of billing clearinghouses and performing billing functions in real-time, and describes examples in which the acceptance (“payment validation”) of assigned fees is a prerequisite to continuing a transaction to select documents. Further, Stefik discloses conditions that must be satisfied, such as a fee acceptance (confirmed by “payment validation data”) prior to carrying out the required function (“retrieving data” and “writing the retrieved data”). See, e.g., Ex.1412 6:63-7:4; Ex.1419 ¶ 58. 2.

Motivation to Combine Stefik with Poggio

Poggio (EP0809221, pub’d Nov. 26, 1997), is prior art under AIA § 18(a)(1)(C). Poggio describes a secure content distribution with content protection, disclosing a “virtual vending machine” (“VVM”) system for sale and distribution of digital products. See, e.g., id. Abstract (“virtual vending machine manages a comprehensive vending service for the distribution of licensed electronic data (i.e., products) over a distributed computer system. . . . [and] distributes licenses for the electronic data for the complete product or for components thereof and for a variety of time frames, including permanent licenses and rental period licenses. [It] provides . . . capability to obtain information regarding the available products and the associated license fees and rental periods, to receive the product upon receipt of a corresponding electronic payment, and to reload the product during the term of the license.”). Poggio, too, discloses different types of access, including rentals, and re-download capabilities for already-purchased content. See, e.g., id. Ex.1419 ¶¶ 35, 50. A POSA would have been motivated and found it obvious to combine Stefik with Poggio, and employ Poggio’s teachings in implementing Stefik’s 38

Covered Business Method Patent Review United States Patent No. 8,336,772 system. These references both disclose systems and methods for managing content distribution and protection to limit authorized access. Both systems receive and process data requests from client devices and execute the requests in cooperation with payment and billing servers that charge users for the requested data. See, e.g. Ex.1415 Abstract; 2:17-20, 2:32-36; see also, e.g., Ex.1412 2:30-32; 4:23-27; see also, e.g., Ex.1413 7:46-49. See, e.g., Ex.1419 ¶ 60. A POSA would have been motivated and found it obvious to implement Stefik’s system using these advantageous elements expressly taught by Poggio at least because both provide systems for content sales and distribution from content providers to content requesters, while ensuring requesters pay for content and suppliers are compensated. Thus, payment security and confirmation are critical to the transactions of both references, and a POSA would have readily appreciated that Poggio’s payment receipt and confirmation servers would be helpful in ensuring that content providers are compensated, as Stefik also discloses. Stefik also aims to encourage spread of content by providing secure transmissions between requesting and providing repositories. Adding such a VVM as taught in Poggio to the Stefik system would provide requesters a central device, which may be a repository itself (e.g., a “kiosk” acting as the VVM), to which multiple content requests could be directed. This would provide suppliers with a central device through which to supply content to many repositories. In addition, Poggio teaches that facilitating the content transactions can advantageously be done with minimal action from the vendor, and

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Covered Business Method Patent Review United States Patent No. 8,336,772 payment validation processes that are automatically executed from stored code, as taught by Poggio, would contribute this additional benefit to Stefik’s system. See, e.g., Ex.1413 2:66-3:1; see also, e.g., Ex.1415 2:32-36; Ex.1419 ¶ 61. 3.

Motivation to Combine Stefik with Poggio and Subler

U.S. Pat. No. 5,646,992 (“Subler,” filed Sept. 23, 1993) issued July 8, 1997, discloses a system that provides an interactive graphical interface (“GUI”) to a user to browse hierarchically organized items that are available for purchasing or installing. Ex.1436 1:32-41. Subler is prior art under AIA § 18(a)(1)(C). The system provides a user with search functionality through which the user browses available content, for example content on a CD-ROM. Id. 12:40-46. When the user performs a search, the user’s device executes code to retrieve information regarding the available content items and presents the retrieved information to the user in an interactive windowed GUI. Id. 4:49-54; 5:26-30; see also, e.g., Ex.1419 ¶ 34. A POSA would have found it obvious to implement the content distribution system taught by Stefik and Poggio using Subler’s teachings of content browsing and code retrieving and presenting data in a search functionality to facilitate a user experience in locating and selecting desired content, for example digital works stored in the hierarchical repository storage of Stefik and vendor products disclosed in Poggio. A POSA would have appreciated the benefit of incorporating Subler’s teachings of executing code on a user’s device to present interactive searching and browsing in order to present the user with data identifying content that is available in local memory, for example on a DocuCard or other 40

Covered Business Method Patent Review United States Patent No. 8,336,772 repository disclosed in Stefik, or from remote memory, for example from a remote repository disclosed in Stefik or a VVM disclosed in Poggio. See Ex.1419 ¶ 62. 4.

Motivation to Combine Stefik with Poggio, Subler, and Ahmad

U.S. Pat. No. 5,925,127 (“Ahmad,” filed Apr. 9, 1997; issued July 20, 1999), is prior art satisfying AIA § 18(a)(1)(C). See Ex.1403. Ahmad discloses a system that “monitor[s] the use of a rented software program module” to prevent use of the rented software “after the expiration of the licensed usage time or licensed number of uses.” Ex.1403 Abstract. The rented software module is associated with a “Check-in/Checkout module” that contains the licensed time or number of uses and a “Software Monitor module” that monitors and ensures that use of the rented software is in accordance with the license restrictions. Id. 9:38-43; 9:66-10:2. The Software Monitor tracks the amount of time the software is used with a timer or counts the number of software uses with a counter and compares the tracked time or use count with the licensed amount of time or licensed number of uses to both determine whether rental use remains and prevent unauthorized software use. Id. 11:14-54. See, e.g., Ex.1419 ¶43. A POSA would have been motivated and found it obvious to implement the distribution system taught by Stefik, Poggio, and Subler using Ahmad’s explicit teachings of a rental usage monitor at least because Ahmad, like Stefik and Poggio, aims to enforce usage restrictions tied to content in order to prevent unauthorized access. See, e.g., Ex.1419 ¶ 64. A POSA would have been motivated and found it advantageous

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Covered Business Method Patent Review United States Patent No. 8,336,772 and obvious to employ Ahmad’s teachings of a monitoring module in implementing the disclosed system of Stefik, Poggio, and Subler to ensure that use of content, for example a digital work in Stefik, a vendor product in Poggio, or a purchased product in Subler is authorized, for example over the period of a rental as taught by Ahmad. Id. A POSA would have appreciated that Ahmad’s explicit teachings advantageously provide a monitor that continuously monitors content and rights restrictions, for example with regular queries to check authorization status during use, in addition to checking the restrictions each time content is requested and accessed. Id. ¶ 64. 5.

Motivation to Combine Stefik with Poggio, Subler, Ahmad, and Kopp

U.S. Pat. No. 5,940,805 (“Kopp,” filed Dec. 13, 1995; issued Aug. 17, 1999), published before any possible ’772 priority date, is prior art satisfying AIA §18(a)(1)(C). See Ex.1404. Kopp discloses a vending system for selling and storing data records on chip cards or other memory devices and limiting the sold data record to a predetermined extent of permitted utilization. Id. 2:50-57. During the purchase, the buyer specifies the extent of utilization that the user wishes to purchase, and the vending system calculates the corresponding fee for the requested utilization. Id. 5:47-55. The purchased extent of utilization (e.g., length of time during which the data record can be used, time limit up to which the data record may be used, number of possible utilizations, and devices in which the data record can be used) is entered into the data record, and the record is stored on the user’s memory device. Id. 5:16-30. When the

42

Covered Business Method Patent Review United States Patent No. 8,336,772 user later requests to access the stored data record stored, a security device checks the recorded data regarding the extent of utilization of the data record and does not permit access if the permitted utilization has been exhausted. Id. 6:41-47. Ex.1419 ¶44. A POSA would have been motivated and found it obvious to implement the data distribution and usage restricting system taught by Stefik, Poggio, Subler, and Ahmad using Kopp’s advantageous teachings of limiting allowed usage to a utilization extent specified and purchased by a user. See, e.g., Ex.1419 ¶65. A POSA would have appreciated that Kopp’s user-customizable usage limitations beneficially allow the user to specify the restrictions on the content and purchase only the usage rights that are needed, which would expand the product offerings of the distribution system taught by Stefik, Poggio, Subler, and Ahmad. Id. Kopp’s explicit teachings provide a data usage control system tailored to a user such that the user pays only for specific needs, and a POSA would have appreciated that such tailored purchasing would advantageously expand product offerings in the system taught by Stefik, Subler, Poggio, and Ahmad. See, e.g., Ex.1404 2:61-65; Ex.1419 ¶65. The examples of restrictions in Kopp—e.g., number of utilizations, length of utilization time, time limit up to which data can be used—are some of the same limitations on usage taught by Stefik, Poggio, and Ahmad. See, e.g., Ex.1413 19:20-31; Ex.1403 11:27-54; Ex.1404 5:16-23. See also, e.g., Ex.1419 ¶65. A POSA would have been motivated and found it obvious to employ Kopp’s explicit teachings of user-customized usage purchases in implementing

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Covered Business Method Patent Review United States Patent No. 8,336,772 the system taught by Stefik and Ahmad to advantageously provide the user with personalized control over the extent and price of content purchases and rentals. Id. 6.

Motivation to Combine Stefik with Poggio, Subler, Ahmad, and Sato

Sato (pub’d June 18, 1999), discloses storing media content onto mobile user devices and playing the media content from these mobile devices, as well as storing that media content on a removable IC card. See, e.g., Ex.1417 ¶ 9 (“portable music selection and viewing device 70 provides a removable storage device 76 on a main body 71. This storage device 76 is a memory card similar to, for example. . . an IC card. The user, after downloading the music software to the storage device (medium) 76 of the portable music selection and viewing device 70 . . . can enjoy this music software on a display 72 or a receiver 74 of . . . device 70, and can also enjoy higher quality music playback by removing this storage device (medium) and inserting it into another audio unit. Further, the user can store the music software from another audio unit into the storage device 76”); ¶ 13; Ex.1419 ¶ 42. Sato is prior art under AIA § 18(a)(1)(C). A POSA would also have been motivated and found it obvious to apply Sato’s teachings in implementing the system taught by Stefik, Poggio, and Subler, at least because all four references disclose storing and providing data content on user devices.16 16

In addition, a POSA would have found it straightforward and obvious to combine

Stefik, Poggio, Subler, Ahmad, Kopp, and Sato for at least the reasons discussed in the context of Stefik, Poggio, Subler, Ahmad, and Kopp, and Stefik, Poggio, Subler,

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Covered Business Method Patent Review United States Patent No. 8,336,772 A POSA would have known that Sato’s cellular phone could readily be programmed to function as a user device in such a system, for example as an embodiment of a Stefik repository, a Poggio client computer, or a Subler end user device. See, e.g., Ex.1417 Problem (“a system providing music software where a user can select a song using a mobile phone.”); ¶9; Ex.1412 2:30-32 (“DocuCard performs the function of a storage medium whose contents can be viewed and managed autonomously”), 4:23-27; Ex.1413 8:23-27; Ex.1419 ¶66. Further, Sato discloses storing content and accessing data on a removable IC card (data carrier). To the extent it is argued that Stefik, Poggio, and Subler do not disclose such a “data carrier,” it is further disclosed by Sato, and thus storing and accessing content data on a removable card is at minimum disclosed by Stefik in light of Sato. A POSA would have been motivated and found it obvious to employ this advantageous expressly teaching of Sato at least because leverages mobile phones to increase media distribution. A POSA would have appreciated that Sato’s mobile phone devices, with the processing power that allows them to provide other services as taught by Sato, could advantageously be programmed with the functions described for repositories in Stefik to add more devices to the media distribution network taught by Stefik, Poggio, and Subler, and would have found it obvious and straightforward to do so. See, e.g., Ex.1417 ¶3 (“it is now possible to offer users a variety of services in addition to phone service”). See, e.g., Ex.1419 ¶ 66. Ahmad, and Sato. See Ex.1419 ¶ 67.

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Covered Business Method Patent Review United States Patent No. 8,336,772 7.

Claims 25, 26, 30, and 32 are Obvious in Light of Stefik in view of Poggio, Subler, and Ahmad (Ground 2), Obvious in Light of Stefik in View of Poggio, Subler, Ahmad, and Kopp (Ground 3), Obvious in Light of Stefik in View of Poggio, Subler, Ahmad, and Sato (Ground 4), and Obvious in Light of Stefik in View of Poggio, Subler, Ahmad, Kopp, and Sato (Ground 5).

Stefik’s disclosure of elements of the challenged claims, along with specific disclosures from Poggio, Subler, Ahmad, Kopp, and Sato for combination with Stefik, are summarized below (see also, e.g., Ex.1419 ¶¶ 56, 68-69, Apx D): Claim 25 A handheld multimedia terminal for retrieving and accessing protected multimedia content, comprising: a wireless interface configured to interface with a wireless network for communicating

Prior Art Stefik discloses a handheld (e.g., transportable) multimedia terminal (e.g., repository, such as a DocuCard) that retrieves and stores multimedia content (e.g., digital works) for access by a user. Ex.1412 Fig. 1; Abstract; 1:6-8; 3:17-18; 4:47-50; 5:12-19; Ex.1413 Fig. 12; 1:14-18; 6:36-40. The stored content is protected (e.g., subject to usage rights and fee conditions). Ex.1413 6:58-61 (“Among other things, repositories are used to store digital works, control access to digital works, bill for access to digital works and maintain the security and integrity of the system.”). The multimedia terminal (e.g., repository, such as a DocuCard) interfaces with or is integral with a rendering device that displays digital information and multimedia, for example a computer system, digital copier, audio CD player or the like. Ex.1412 4:23-31; Ex.1413 Figs. 2, 4b; 3:50-56; 4:30-33; 13:47-49. See Ex.1419 75-77. Stefik discloses an interface (e.g., an external interface or I/O port of a repository) for accessing (e.g., communicating with) a remote computer system (e.g., other repositories; credit servers; rendering devices). Ex.1412 Fig. 2; 2:37-40; 5:58-67; Ex.1413 Figs. 2, 12; 7:14-17; 14:44-50 (“The external interface means 1206 provides for the signal connection to other repositories and to a credit server. The external interface means 1206 provides for the exchange of signals via such standard interfaces such as RS-232 or Personal Computer Manufacturers Card Industry Association (PCMCIA) standards, or FDDI. The external interface means 1206 may also provide network connectivity.”); 26:52-57. Stefik states that commonplace transmission of content over networks (e.g., the Internet) provides an increasingly convenient interface for accessing and distributing media 46

Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25 Prior Art with a da- among remote computer systems. Ex.1413 1:25-28 (“The ease in which electa suppli- tronically published works can be ‘perfectly’ reproduced and distributed is a major coner; cern. The transmission of digital works over networks is commonplace. One such widely used network is the Internet.”). When a repository is implemented as a DocuCard, a DocuCard is inserted to a PCMCIA slot of another repository or interfaces with a second DocuCard. Ex.1412 5:19-22; 6:32-43. See Ex.1419 77-79.17 Sato discloses user equipment that retrieves digital content through a wireless interface (e.g., a radio transceiver) for communicating with a remote computer system (e.g., a distribution center) over a wireless network (e.g.,

17

To the extent that Stefik does not explicitly disclose wireless communications, a

POSA would have appreciated and found it obvious to implement Stefik’s media distribution among repositories using wireless communications, and to do so by employing, for the disclosed repository interfaces, wireless interfaces with this capability. Wireless communication over the Internet was well known before the ’772 patent, and a POSA would have readily appreciated that the Internet content distribution, including communication between repositories (including, e.g., “kiosk” and “DocuCard” repositories) or between a repository and a remote server using TCP/IP channels, could advantageously have been implemented using wireless connections (in addition to wired connections) that were well known in the art. A POSA would have recognized that implementing such wireless connections would have advantageously increased a user’s ability to access content remotely, thus increasing content distribution as Stefik aims to achieve. See Ex.1419 79-80.

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Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25

18

Prior Art awireless public communications network).18 Ex.1417 ¶ 3 (“In conjunction with the spread of mobile phone systems, it is now possible to offer users a variety of services in addition to phone services. The present invention provides a music selection viewing system that uses a wireless public communications network.”); ¶ 4; ¶ 6; ¶ 8; ¶ 1012. See Ex.1419 80-81. Poggio discloses client computers accessing a remote computer system (e.g., VVM) over a network (e.g., Internet). Ex.1415 Fig. 1; 4:15-20 (“Each client computer 120 can be connected to at least one server computer 212 through a network interconnectivity means 202, preferably the Internet. The present invention is not limited to the use of the Internet as other types of communication connections can be used.”). A client computer includes an interface (e.g. interconnectivity means; communications interface) to communicate over the network andaccess the remote system (e.g., VVM). Id. Fig.4; 8:2-12.19 See Ex.1419 81.

A POSA would have been motivated and found it obvious to implement Stefik’s

system of repositories for encouraging the secure distribution of digital media, using Sato’s advantageous explicit teachings of a mobile media device (such as a mobile phone) for accessing such media wirelessly to increase the spread of the content distribution. See Ex.1419 80-81. 19

To the extent that Poggio does not explicitly disclose wireless communications, a

POSA would have appreciated and found it obvious to implement Poggio’s VVM using wireless communications, and to do so by employing, for the disclosed client computer interfaces, wireless interfaces with this capability. Wireless communication over the Internet was well known before the ’772 patent, and a POSA would have readily appreciated that the distribution of content among vendors, a VVM, and client computers in Poggio, as well as communications with the electronic banking network,

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Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25 non-volatile memory configured to store multimedia content, wherein said multimedia content comprises one or more of music data, video data

Prior Art Stefik discloses repositories including non-volatile memory (e.g., RAM; ROM; nonvolatile solid state storage; optical disk) for storing multimedia content (e.g., digital works). Ex.1412 Fig. 2; Abstract; 6:2-19; Ex.1413 Fig. 12; 9:21-23 (“In the currently preferred embodiment, the file information of the digital work is divided into two files: a ‘contents’ file and a ‘description tree’ file.”); 14:28-35. Content stored in repository memory includes music data, video data, and computer data (e.g., software).20 Ex.1412 4:23-31; Ex.1413 Fig. 5;

could advantageously have been carried out over wireless communications interfaces that were well known in the art. A POSA would have recognized that implementing such wireless connections would have advantageously increased a user’s ability to access content remotely, thus providing users with access to the VVM remotely. A POSA would have been motivated and found it obvious to implement Stefik’s configuration of repositories for distributing content, using Poggio’s advantageous explicit teachings of a VVM arrangement to connect clients with vendors and encourage the distribution of content. As both Stefik and Poggio disclose that the Internet is a suitable medium for that distribution, a POSA would have found it obvious to employ a repository as explicitly taught in Stefik to access Poggio’s VVM over the Internet. See Ex.1419 81-82. 20

A POSA would have understood that Stefik’s disclosure of RAM as a component

of a repository necessarily, and thus inherently, discloses non-volatile RAM storage, because, inter alia, Stefik’s repositories would otherwise be unable to retain the stored digital works, software code implemented by a processor, and billing and transaction

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Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25 Prior Art and computer game 9:34-36. See Ex.1419 82-84. data; a program Stefik discloses a program store (e.g., ROM and RAM; processor memory store stor- 1202) within a handheld multimedia terminal (e.g., a repository, such as a ing pro- DocuCard) that stores control code for a processor (e.g., software instruccessor tions utilized by processor element 1201 in performing the functions of a control repository). Ex.1412 Abstract; 2:34-37; 5:45-47; Ex.1413 Fig. 12; 14:15-27 code; (“The processing means 1201 provides controller, repository transaction and usage rights transaction functions for the repository… The processor memory 1202 would typically be further comprised of Read Only Memories (ROM ) and Random Access Memories (RAM). Such memories would contain the software instructions utilized by the processor element 1201 in performing the functions of the repository.”). See Ex.1419 84. Poggio discloses a program store (e.g., memory) in a multimedia terminal (e.g., VVM; client computer) that stores control code (e.g., procedures) for a processor (e.g., CPU).21 Ex.1415 Figs. 1, 2, 4; 4:50-5:12; 8:2-12 (“The client computer 120 can include a central processing unit (CPU) 402, a user interface 404, a information in periods where power was not being applied. At a minimum, a POSA would have found it straightforward and obvious to employ non-volatile RAM storage in a repository. See Ex.1419 82-84. 21

A POSA would have been motivated and found it obvious to implement Stefik’s

configuration of repositories (including, e.g., “kiosk” and “DocuCard” repositories) using Poggio’s explicit teachings of a VVM arrangement to simplify the transactions required for content distribution. The VVM includes software and processing logic to serve as both a provider to clients and a requester from vendors (like the repositories in Stefik), and acts as a central location with which both providing and requesting repositories can communicate to simplify the transactions involved in content distribution. See Ex.1419 84-85.

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Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25

a processor coupled to said nonvolatile memory, said program store, said wireless interface and a user interface to allow a 22

Prior Art memory 408, and a communications interface 406 for communication with the virtual vending machine 122 via the communications network 202. The memory 408 of the client computer 120 can be used to store the following: operating system 410; Internet access procedures 412; web browser 414….”). See Ex.1419 84-85. Stefik discloses a processor (e.g., controller module; microprocessor; processing element 1201) coupled to non-volatile memory22 (e.g., memory; ROM; RAM; storage system), a program store (e.g., memory; ROM; RAM; processor memory 1202), a communications interface23 (e.g., external interface), and a user interface that executes software instructions to select and play multimedia content (e.g., to carry out functions of a repository, such as a DocuCard). Ex.1412 Fig. 2; Abstract; 2:35-37; 2:40-43; 5:22-27; 5:34-47; 6:115; Ex.1413 Fig. 12; 14:15-27 (“The processing means 1201 provides controller, repository transaction and usage rights transactions functions for the repository…; 16:43-51 (“A user interface is broadly defined as the mecha-

A POSA would have understood that Stefik’s disclosure of RAM as a component

of a repository necessarily, and thus inherently, discloses non-volatile RAM storage, because, inter alia, Stefik’s repositories would otherwise be unable to retain the stored digital works, software code implemented by a processor, and billing and transaction information in periods where power was not being applied. At a minimum, a POSA would have found it straightforward and obvious to employ non-volatile RAM storage in a repository. See Ex.1419 85-88. 23

To the extent that Stefik does not explicitly disclose a wireless interface, a POSA

would have found employing such a feature to be straightforward and obvious. See “wireless interface” limitation, supra; Ex.1419 13.

51

Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25 Prior Art user to se- nism by which a user interacts with a repository in order to invoke transactions to gain lect and access to a digital work, or exercise usage rights…”); 16:61-65. See Ex.1419 85-88. play said multimedia content; a display for dis- Stefik discloses a multimedia terminal (e.g., rendering system; reposiplaying one or tory, such as a DocuCard) including a display for providing the user both of said with data relating to played content (e.g., identification information played multime- for available digital works) or displaying played multimedia content dia content and (e.g., playing a requested digital work). Ex.1412 2:45-46; 7:5-11; data relating to Ex.1413 Fig. 4b; 4:29-35; 7:66-8:3; 8:23-28; 8:57-67 (“Fig. 4b is an said played mul- example of a computer system as a rendering system. A computer system may timedia content; constitute a ‘multifunction’ device since it may execute digital works (e.g. softwherein the pro- ware programs) and display digital works (e.g. a digitized photograph)…”); cessor control 16:48-51; 36:30-60. See Ex.1419 88-89. code comprises: code to Stefik discloses a hierarchical document storage system employed by rerequest positories. Ex.1412 3:32-38(“Documents are stored in a hierarchical file system and identifier in a lexical ordering”); 7:22-32; Ex.1413 Fig. 7; 9:21-29. The system permits a data iden- user to navigate through layers of hierarchy directories to locate and select tifying the desired multimedia content (e.g., digital work) available from a supplier one or repository (e.g., stored in memory on a repository, such as a DocuCard). more Ex.1412 Fig. 14; 7:8-11 (“A list of available documents on the repository is then items of presented wherein the user selects the desired document, step 305 and the destination multime- where the document is to be placed, step 306.”). A requesting repository in Stefik dia con- interfaces with a supplying repository over a communications interface tent avail- (e.g., external interface) to allow a user to navigate and request content.24 able for Ex.1413 Fig. 12. The multimedia content (e.g., digital work) is identified to retrieving the user by identifier data (e.g., title). Ex.1412 Figs. 7, 17; Ex.1413 9:54via said 10:1. The functions of the repository are performed by a processor (e.g., wireless processor element 1201) implementing stored code (e.g., software instruc24

A POSA would have found it obvious and straightforward to implement wireless

interfaces and wireless communications between repositories. See “wireless interface” limitation, supra.

52

Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25 Prior Art interface; tions utilized by the processor element 1201) to provide identifier data and navigation to a user. Ex.14:15-35. See Ex.1419 90-92. Stefik discloses navigation of digital work directories occurring during repository transactions, for example in a Directory transaction in which one repository requests information about digital works stored in another repository. Ex.1412 11:36-38 (“Referring back to FIG. 14, when the repository has been selected, the user searches for the document through the hierarchical directory structure of the repository.”); Ex.1413 38:66-39:18 (“A Directory transaction is a request for information about folders, digital works, and their parts…”). See Ex.1419 92. Poggio discloses a user requesting information for vendor products by entering search requests used by the VVM to locate data in an index of available products. Ex.1415 2:39-44; 5:28-32 (“The Web Server 114 responds to requests from users for information and orders for a vendor product. The Web Server 114 interacts with other system components in the virtual vending machine 122 in order to process the user’s request.”); 7:44-53; 8:49-57 (“If the user wants to perform a search of the various vendor products or categories that are available, the user selects the perform category search menu button 506. A search Web page (not shown) will be downloaded to the user which will guide the user on the available search capabilities and search keywords. The index search engine 126 will receive the user’s search criteria and perform the search utilizing the index of the product information 108.”). The data communications and presentation of a client computer in Poggio are implemented by executing code (e.g., operating system, internet access procedures) using a CPU of the client. Id. Ex.1415 Fig. 4; 8:2-12.25 See Ex.1419 92-93. 25

A POSA would have been motivated and found it obvious to implement Stefik’s

repository systems using Poggio’s advantageous teachings of responding to user requests for product information using a product indexing and searching process, for example by employing such an index and search interface in a supplying repository, to assist a user in locating desired content. A POSA would have appreciated and found it obvious to incorporate code to request product data from the vending machine, for example to implement requests for product information by users, as explicitly taught

53

Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25

Prior Art Subler discloses browsing available multimedia (e.g., available files on a CD-ROM) using an end-user device. Ex.1436 1:31-36; 3:28-31 (“The publisher can provide a large number and wide variety of items to a user, permitting the user to browse and preview the items, giving the user the opportunity to pick and pay for only those items of interest.”); 12:53-56 (“The end user invokes the search function by clicking on the search button 390 (FIG. 13). When the search is completed the results are represented by thumbnails displayed in the Viewer window.”). The user browses by searching and navigating interactive displays of available content, including identifier data (e.g., titles) of available items. Id. 7:14-18. The displayed data describing the available content is requested from (e.g., “derived” from) the CD-ROM database when the user invokes a search function to search the contents of the database. Id. 12:18-22. Subler expressly discloses software code providing the integrated navigation and data retrieval and display functions of the end user device. Id. 4:49-54; 5:26-30 (“The end user system includes code which provides an integrated windowed graphical user interface through which users may browse, preview, order, unlock, and install valued items and other information stored on the CD-ROM.”).26 See Ex.1419 94-95.

by Poggio, into the repository transactions taught by Stefik to assist a user in navigating the document storage systems taught by Stefik. See Ex.1419 93-94. 26

A POSA would have been motivated and found it obvious to implement the

content distribution system taught by Stefik and Poggio using the advantageous interactive navigation interfaces taught by Subler to further provide a user with the ability to query storage records and receive identifying data for available content. A POSA would have appreciated the benefit of executing the search functionality of Subler, for example to request information from a content database in the userinvoked search function taught by Subler, with code embedded in a requesting device. See, e.g., Ex.1436 3:46-50. See Ex.1419 95.

54

Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25 code to receive said identifier data via said wireless interface, said identifier data identifying said one or more items of multimedia content available for retrieving via said wireless interface;

27

Prior Art Stefik discloses a hierarchical document storage system employed by repositories. Ex.1412 3:32-38; 7:22-32; Ex.1413 Fig. 7; 9:21-29. The system permits a user to navigate through layers of hierarchy directories to locate and select the desired multimedia content (e.g., digital work) available from a supplier repository (e.g., stored in memory on a repository, such as a DocuCard). Ex.1412 Fig. 14; 7:8-11; Ex.1413 38:66-39:18 (“…The Directory transaction has the important role of passing along descriptions of the rights and fees associated with a digital work. When a user wants to exercise a right, the user interface of his repository implicitly makes a directory request to determine the versions of the right that are available…”). A requesting repository in Stefik interfaces with a supplying repository over a communications interface (e.g., external interface) to allow a user to navigate and request content. Ex.1413 Fig. 12. The multimedia content (e.g., digital work) is identified to the user by identifier data (e.g., identification stored in a description tree file). Ex.1412 Figs. 7, 17; Ex.1413 9:54-10:1. The functions of the repository are performed by a processor (e.g., processor element 1201) implementing stored code (e.g., software instructions utilized by the processor element 1201) to provide identifier data and navigation to a user. Ex.1413 14:15-35.27 See Ex.1419 95-98. Subler discloses browsing and searching available multimedia (e.g., available files on a CD-ROM) on an end-user device. Ex.1436 1:31-36; 3:28-31; 12:53-56 (“The end user invokes the search function by clicking on the search button 390 (FIG. 13). When the search is completed the results are represented by thumbnails displayed in the Viewer window.”). Subler employs interactive displays of available content, including identifier data (e.g., titles) of available items, to provide the user with search functionality. Id. 7:14-18. The displayed data describing the available content is received from (e.g., “derived” from) the CD-ROM database when the database responds to a user-invoked search function to search the contents of the database. Id. 12:18-22. Subler expressly discloses software code providing the integrated navigation and da-

A POSA would have found it obvious and straightforward to implement wireless

interfaces and wireless communications between repositories. See “wireless interface” limitation, supra.

55

Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25 code to request content information via said wireless interface, wherein said content information comprises one or 28

Prior Art ta retrieval and display functions of the end user device. Id. 4:49-54; 5:2630.28 See Ex.1419 98-99. Stefik’s hierarchical document storage system provides a user on a multimedia terminal (e.g., repository, such as a DocuCard) with identifier data (e.g. identification information in a description tree file) of content available from a repository over a communications interface (e.g., external interface). Ex.1412 Figs. 14, 17; 3:32-38; 7:22-32; Ex.1413 Fig. 7; 9:54-10:1. The identifier data (e.g., information in the description tree) identifies the content available via the interface (e.g., content available from a repository in communication with the repository over the external interface). Ex.1412 7:811; Ex.1413 9:21-29; 38:66-39:18 (“A Directory transaction is a request for information about folders, digital works, and their parts… The functions of the repository are performed by a processor (e.g., processor element 1201) implementing stored code (e.g., software instructions utilized by the processor element 1201) to provide identifier data and navigation to a user.”). Ex.1413 14:15-35.29 See Ex.1419 99-102.

A POSA would have been motivated and found it obvious to implement the

content distribution system taught by Stefik and Poggio using the advantageous interactive navigation interfaces taught by Subler to further provide a user with the ability to query storage records and receive identifying data for available content. A POSA would have appreciated the benefit of executing the search functionality of Subler, for example to request information from a content database in the userinvoked search function taught by Subler, with code embedded in a requesting device. See, e.g., Ex.1436 3:46-50. See Ex.1419 99. 29

To the extent that Stefik does not explicitly disclose wireless communications, a

POSA would have found it obvious and straightforward to implement wireless interfaces and communications between repositories. See “wireless interface”

56

Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25 more of description data and cost data pertaining to at least one of said one or more items of multimedia content identified by said identifier data;

Prior Art Poggio discloses a user requesting additional information for products by requesting content information (e.g., by selecting a product) to access content information including description data and cost data (e.g., information describing a particular product; license fee schedule). Ex.1415 2:39-44; 8:58-9:15 (“If the user wants to access information describing a particular product, the user selects the button 504 corresponding to the title of the product and the view product information menu button 508. A first Web page (not shown) associated with the selected product is then downloaded to the user. Subsequent Web pages of product document are accessed by the user using standard hypertext linking provided by the client computer’s Web browser and hypertext links in the product documentation…”). The data communications and presentation of a client computer in Poggio are implemented by executing code (e.g., operating system, internet access procedures) using a CPU of the client. Id. Fig. 4; 8:2-12.30 See Ex.1419 102-103. Subler also discloses a user accessing content information (e.g., previews, information describing the item, icons, copyright information) for available products. Ex.1436 1:43-46 (“The graphical user interface enables a user to preview additional detailed information concerning an item when a representation of an item is displayed, using a pointer.”); 3:18-23; 7:44-48; 12:10-14 (“By clicking an individual

limitation, supra; Ex.1419 102. 30

A POSA would have been motivated and found it obvious to implement Stefik’s

repository configuration and hierarchical document storage using Poggio’s explicit teachings of responding to user requests for product information by presenting selectable product information pages to provide the user with efficient navigation and content selection. A POSA would have understood that employing Poggio’s advantageous teachings of fee and information pages, including executing code to receive the product data presented in such pages, would provide a user with additional information to assist the user in locating the desired content and purchase options. See Ex.1419 103.

57

Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25

Prior Art item thumbnail, the user may cause display of additional information about that item (for example more comprehensive displays of the font (FIG. 14)).”. Subler expressly discloses software code providing the integrated navigation and data retrieval and display functions of the end user device. Id. 4:49-54; 5:26-30.31 See Ex.1419 103-104. code to Stefik’s hierarchical document storage system permits a user to navigate receive through layers of the hierarchy directories to locate and select the desired said con- content (e.g., digital work stored in memory on a repository, such as a tent inDocuCard). Ex.1412 Figs. 7, 17; 3:32-38; 7:22-32. The content information formation is retrieved from a remote repository (e.g., a repository functioning in a via said supplier mode) to allow the user to browse the contents of the remote rewireless pository. Ex.1412 Fig. 14; 7:8-11; Ex.1413 Fig. 7; 9:21-29; 9:54-10:1; 38:66interface; 39:18. The functions of the repository are performed by a processor (e.g., processor element 1201) implementing stored code (e.g., software instructions utilized by the processor element 1201) to provide a user with navigation and selection of available content. Ex.1413 14:15-35.32 See Ex.1419 31

A POSA would have been motivated and found it obvious to implement the

content distribution system taught by Stefik and Poggio using the advantageous interactive navigation interfaces taught by Subler, presented by executing code that allows the user to browse through the information, to provide a user with the ability select available items and obtain further information, including previews and detailed descriptions. A POSA would have appreciated the benefit of incorporating the additional detailed content information to allow a user to learn about available items before actually having access to the items, as explicitly taught by Subler. See, e.g., Ex.1436 3:46-50. See Ex.1419 104. 32

A POSA would have found it obvious and straightforward to implement wireless

interfaces and communications between repositories to facilitate content navigation

58

Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25

Prior Art

code to present said content information pertaining to said identified one or more items of

104-107. Poggio discloses providing additional information for products to a user (e.g., in response to a user selection of a product) by presenting content information including description data and cost data (e.g., information describing a particular product; license fee schedule). Ex.1415 2:39-44 (“The virtual vending machine provides the users with product information for the electronic data which details the operational requirements for the product as well as the associated license fees. The product information can be searched by the user using various keywords.”); 8:58-9:15. The data communications and presentation of a client computer in Poggio are implemented by executing code (e.g., operating system, internet access procedures) using a CPU of the client. Id. Fig. 4; 8:212.33 See Ex.1419 107. Subler also discloses providing a user with content information (e.g., previews, information describing the item, icons, copyright information) for available products. Ex.1436 1:43-46 (“The graphical user interface enables a user to preview additional detailed information concerning an item when a representation of an item is displayed, using a pointer.”); 3:18-23; 7:44-48; 12:10-14. Subler expressly discloses software code providing the integrated navigation and data retrieval and display functions of the end user device. Id. 4:49-54; 5:2630.34 See Ex.1419 108-109. Stefik discloses user navigation of the hierarchical document storage system through a series of displays presented to the user. Ex.1412 Fig. 14; 3:32-38; 7:22-32; Ex.1413 Fig. 7; 9:54-10:1. The content (e.g., digital works) is presented to the user on the display with content information (e.g., identification information such as a content identifier and cost information retrieved from a description tree file). Ex.1412 Fig. 7, 17; 7:8-11; 8:65-9:8; Ex.1413 9:21-29; 38:66-39:11. The functions of the repository are performed by a processor (e.g., processor element 1201) implementing stored code (e.g., software instructions utilized by the processor element 1201) to present content information to a user for navigation to desired content. Ex.1413 14:15-35. See Ex.1419 109-111.

and selection. See “wireless interface” limitation, supra; Ex.1419 107. 33

See n.30, supra; Ex.1419 107-108.

34

See n.31, supra; Ex.1419 109.

59

Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25 multimedia content available for retrieving to a user on said display;

Prior Art Poggio discloses providing additional information for products to a user (e.g., in response to a user selection of a product) by providing content information including description data and cost data (e.g., information describing a particular product; license fee schedule). Ex.1415 2:39-44; 8:589:15 (“…Similarly, if the user chooses to access the license fee schedule for a particular product, the user selects the button 504 corresponding to the title of the product and the menu button 510 for viewing the license fee schedule. Another Web page (not shown) is then transmitted to the user which contains the license fee schedule for the particular product.”). The data communications and presentation of a client computer in Poggio are implemented by executing code (e.g., operating system, internet access procedures) using a CPU of the client. Id. Fig. 4; 8:2-12.35 See Ex.1419 112. Subler also discloses providing a user with content information (e.g., previews, information describing the item, icons, copyright information) for available products. Ex.1436 1:43-46 (“The graphical user interface enables a user to preview additional detailed information concerning an item when a representation of an item is displayed, using a pointer.”); 3:18-23 ; 7:44-48; 12:10-14. Subler expressly discloses software code providing the integrated navigation and data retrieval and display functions of the end user device. Id. 4:49-54; 5:2630.36 See Ex.1419 113-114. code to reStefik discloses user navigation of the hierarchical document storage ceive a first system to select multimedia content (e.g., digital works). Ex.1412 2:40user selection 46. The available content (e.g., digital works) is presented to the user, selecting at and a terminal (e.g., repository, such as a DocuCard) receives user seleast one of lections of desired content through a user interface. Ex.1412 7:5-11; said one or 10:45-48; Ex.1413 16:43-52. The functions of the repository are permore items of formed by a processor (e.g., processor element 1201) implementing multimedia stored code (e.g., software instructions utilized by the processor elecontent avail- ment 1201) to receive and process user selections of content. Ex.1413 able for re14:15-27 . See Ex.1419 114-115. trieving; code re- Stefik discloses repositories communicating with a credit server and/or a sponsive clearinghouse (payment validation system) to carry out transactions, in35

See n.30, supra; Ex.1419 112-113.

36

See n.31, supra; Ex.1419 114.

60

Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25 to said first user selection of said selected at least one item of multimedia content to transmit payment data relating to payment for said selected at least one item of multimedia content via said wireless interface for validation by a payment validation

37

Prior Art cluding sending data (e.g., initiating financial transactions with credit servers) to check fee conditions tied to usage rights after content (e.g., a digital work) is requested. Ex.1413 Fig. 18; 29:59-30:11; 30:62-31:4; 32:21-28 (“[F]ee conditions for the right are then checked, step 1815. This will initiate various financial transactions between the repository and associated credit server…”). The payment validation system (e.g., credit server) communicates with repositories and the clearinghouse via a network to reconcile content charges. Ex.1413 8:11-20; 14:44-46; 17:1-7 (“In the present invention, fees may be associated with the exercise of a right. The requirement for payment of fees is described with each version of a usage right in the usage rights language. The recording and reporting of such fees is performed by the credit server.”). Stefik discusses embodiments in which the charge reconciliation happens in “real-time” with the server acting as a “debit card.” Ex.1412 Fig. 3; 6:60-7:4; Ex.1413 17:20-46. The payment data forwarded to the payment validation system (e.g., a credit server) includes data relating to payment for at least one item of content (e.g., transaction identifiers, repository identifiers, and lists of charges). Ex.1413 19:68. The functions of the repository are performed by a processor (e.g., processor element 1201) implementing stored code (e.g., software instructions utilized by the processor element 1201) to transmit and receive payment information. Ex.1413 14:15-27.37 See Ex.1419 115-118. Poggio discloses transmitting payment data (e.g., a credit card number) responsive to a user selection of content and relating to payment for the selected content (e.g., in order to pay for a requested product) to a payment validation system (e.g., an electronic banking network) for validation. Ex.1415 Fig. 7; 5:45-47; 6:16-24 (“The digital cash interface 116 is connected to an electronic banking network 118 which is a communications link to financial institutions such as banks, automatic clearing houses, and the like…”); 9:56-10:10 (“…The user adds a credit card number (or other form of payment authorization) to the invoice, which is then encrypted and forwarded back to the web server 114. The web server 114 attaches a confirmation number to the invoice and the entire invoice is encrypted and transmit-

To the extent that Stefik does not explicitly disclose wireless communications, a

POSA would have found it both obvious and straightforward to employ wireless communications interfaces between repositories and a credit server. See “wireless interface” limitation, supra; Ex.1419 118.

61

Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25 Prior Art system; ted to the digital cash interface 116. The digital cash interface 116 reformats the invoice into the appropriate format for transmittal to the electronic banking network 118 which processes the transaction.”); 10:41-53. The electronic payment transaction is carried out by a processor (e.g., CPU) implementing code (e.g., procedures) stored in memory.38 Id. 4:50-5:7.39 See Ex.1419 118-120. code to Stefik discloses receiving payment validation data (e.g., acceptance of fees) receive for multimedia content (e.g., selected digital works). Ex.1412 Fig. 3; 7:2-4 payment (“Of course the acceptance of fees by the repository may be a prerequisite to the continuavalidation tion of the process.”); Ex.1413 18:33-38; 30:62-31:4; 32:21-28. The payment data via validation defines if said payment validation system has validated payment said wire- (e.g., has accepted fees; has verified fee conditions are met) and is received less inter- from a payment validation system (e.g., credit server). Ex.1413 Fig. 18; face de- 8:11-20; 14:44-46; 17:20-44 (“A credit server is a computational system that reliafining if bly authorizes and records these transactions so that fees are billed and paid. The credit said pay- server reports fees to a billing clearinghouse. The billing clearinghouse manages the finanment val- cial transactions as they occur…”); 17:1-7; 29:59-64. The functions of the reidation pository are performed by a processor (e.g., processor element 1201) im-

38

A POSA would have been motivated and found it obvious to implement Stefik’s

repository configuration, including security and payment features for distributions of digital media, using Poggio’s advantageous explicit teachings of a VVM arrangement and a web server to distribute such media to client computers for access, including the transmission of a transaction information to a payment validation system to pay for content. See Ex.1419 119-120. 39

To the extent that Poggio does not explicitly disclose wireless communications, a

POSA would have found it both obvious and straightforward to implement wireless interfaces and wireless communications between client computers, a VVM, and the electronic banking network. See “wireless interface” limitation, supra; Ex.1419 120.

62

Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25 system has validated payment for said selected at least one item of multimedia content; and

Prior Art plementing stored code (e.g., software instructions utilized by the processor element 1201) to transmit and receive payment information. Id. 14:15-27.40 See Ex.1419 120-122. Poggio discloses receiving payment validation data (e.g., confirmation) defining if a payment validation system (e.g., electronic banking network) has validated payment (e.g., indication signifying successful completion of the payment transaction) for multimedia content (e.g., a vendor product). Ex.1415 Fig. 7; 3:1-4; 5:45-47 (“The digital cash interface 116 can provide the point-of-sale cash payment for the license fees associated with the vendor products.”); 6:16-24; 10:10-25 (“The digital cash interface awaits for an indication from the electronic banking network 118 signifying successful completion of the payment transaction (i.e., credit card or electronic funds transfer transaction). This indication is forwarded to the web server (step 712)…”); 10:41-53. The electronic payment transaction is carried out by a processor (e.g., CPU) implementing code (e.g., procedures) stored in memory.41 Id. 4:50-5:7.42 See Ex.1419 122-124.

40

To the extent that Stefik does not explicitly disclose wireless communications, a

POSA would have found it both obvious and straightforward to implement wireless interfaces and communications between repositories and credit servers. See “wireless interface” limitation, supra; Ex.1419 122. 41

A POSA would have been motivated and found it obvious to implement Stefik’s

repository configuration, including security and payment features for distributions of digital media, using Poggio’s advantageous explicit teachings of a VVM arrangement and a web server to distribute such media to client computers for access, including the transmission of a transaction information to a payment validation system to pay for content. See Ex.1419 122-124. 42

To the extent that Poggio does not explicitly disclose wireless communications, a

63

Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25 code responsive to said payment validation data to retrieve said selected at least one item of multimedia content via said wireless interface from a data supplier and to write said retrieved at least one item of multimedia content in-

Prior Art Stefik discloses retrieving data from a data supplier and writing the retrieved data into non-volatile memory (e.g., carrying out the requested function) in response to (e.g., only after) the satisfaction of usage conditions, including payment validation data (e.g., information verifying that fee payment conditions are met), for requested content (e.g., requested digital work). Ex.1412 Fig. 3; 7:2-13; Ex.1413 4:6-13; 7:13-33 (“The request for access begins with a session initiation by another repository. Here a Repository 2 initiates a session with Repository 1, step 103…. If access is granted, repository 1 transmits the digital work to repository 2, step 107.”); 7:44-56; 18:33-38; 30:6164; 32:44-47 (“An important area to consider is the transmission of the digital work from the server to the requester. The transmission protocol described herein refers to events occurring after a valid session has been created.”). The transaction functions of the repository are done by a processor (e.g., processor element 1201) implementing code (e.g., software instructions utilized by the processor element 1201) to retrieve and write requested content. Ex.1413 14:22-27.43 See Ex.1419 124-125. Poggio also discloses retrieving data (e.g., a vendor product) and writing (e.g., transmitting) the data to a data carrier (e.g., client computer) responsive to (e.g., only after) payment validation (e.g., confirmation that the payment has been made) is received from the payment validation system (e.g., electronic banking network). Ex.1415 Fig. 7; 3:1-4; 5:45-47; 9:5610:25 (“…The method then proceeds to format the purchased product for transmission to the user (step 718).”); 10:41-53. The electronic payment transaction is car-

POSA would have found it both obvious and straightforward to implement wireless interfaces and communications with the digital cash interface and electronic banking network. See “wireless interface” limitation, supra; Ex.1419 124. 43

A POSA would have found it obvious and straightforward to implement wireless

interfaces and communications between repositories to facilitate content distribution. See “wireless interface” limitation, supra; Ex.1419 125.

64

Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25 to said nonvolatile memory, code to receive a second user selection selecting one or more of said items of retrieved multimedia content to access;

44

Prior Art ried out by a processor (e.g., CPU) implementing code (e.g., procedures) stored in memory at the VVM.44 Id. Figs. 1, 2; 4:50-5:7.45 See Ex.1419 125127. Stefik discloses user navigation of the hierarchical document storage system to select multimedia content (e.g., digital works). Ex.1412 2:40-46; Ex.1413 16:43-52. The content (e.g., digital works) available on a terminal (e.g., repository, such as a DocuCard) is presented to the user, and the terminal (e.g., repository, such as a DocuCard) receives user selections of desired content through a user interface. Id. For example, a first selection (e.g., a loan or transfer transaction) is made to obtain the requested content, and a second selection (e.g., a play transaction) is made to perform an action using the content. Ex.1412 7:5-11 (“Now, the user of the DocuCard selects the desired function for obtaining the document, step 304. The particular function will correspond to a particular usage right and indicates how the user wishes to use the document…”); 10:45-48. In addition, a user can request multiple different works available from the same repository through separate selections of the desired content. Id. The functions of the repository are performed by a processor (e.g., processor element 1201) implementing stored code (e.g., software instructions utilized by processor element 1201) to receive and pro-

A POSA would have been motivated and found it obvious to implement Stefik’s

system, including security and payment features, using Poggio’s advantageous explicit teachings of a VVM arrangement and a web server to process payments and wait to provide media or perform a requested function until valid payment for that media or function is received. See Ex.1419 126-127. 45

To the extent Poggio does not explicitly disclose wireless communications, a POSA

would have found it obvious and straightforward to implement wireless interfaces and communications between client computers, the VVM, and the electronic banking network to distribute content. See “wireless interface” limitation, supra; Ex.1419 127.

65

Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25 code to read use status data and use rules from said nonvolatile memory pertaining to said second selected one or more items of retrieved multimedia content; and

46

Prior Art cess user selections of content. Ex.1413 14:15-27 . See Ex.1419 127-129. Stefik discloses attaching usage rights to content data items (e.g., digital works) stored at a repository. Ex.1412 4:40-43 (“Usage rights are attached to digital works and control how the digital work can be used or distributed, and are further used to specify any fees associated with use or distribution of digital works.”); Ex.1413 Abstract; 6:42-45; 7:59-61; 11:59-12:7. The usage rights tied to a content data item (e.g., digital works) indicate the status of rights associated with the stored data. Ex.1412 8:8-10; Ex.1413 9:26-29; 10:28-32 (“right code field 1001 will contain a unique code assigned to a right. The status information field 1001 will contain information relating to the state of a right and the digital work.”); Table 1; 19:12-15 (“Grammar element 1501 “Digital Work Rights:=(Rights*)” define the digital work rights as a set of rights. The set of rights attached to a digital work define how that digital work may be transferred, used, performed or played.”). The usage rights are stored in parameter memory (e.g., description tree storage; storage system) and are read (e.g., accessed by a processor, such as a processor element 1201) when content requests are received. Ex.1412 3:9-11; 7:24-26; Ex.1413 14:15-27; 17:66-18:6; 30:36-47; 31:26-28. Usage rights include a copy count restriction that limits the number of copies of a digital work that are allowed to be made and used simultaneously. Ex.1413 21:9-24 (“For various transactions, it may be desirable to provide some limit as to the number of ‘copies’ of the work which may be exercised simultaneously for the right…”). The usage right maintains a counter that is decremented each time the corresponding right is exercised. Id. 31:47-62. See Ex.1419 129-132. Ahmad46 discloses retrieving use status data (e.g., reading a recorded elapsed time of actual use; reading a counter recording total number of ac-

A POSA would have been motivated and found it obvious to implement Stefik’s

system using Ahmad’s explicit teachings of a software monitor to track use status data indicating a rented product’s amount of usage to limit usage of digital works in Stefik’s repository. Usage in Stefik is controlled by usage rights tied to the works, and a POSA would have been motivated and found it advantageous and obvious to provide a monitoring module as taught in Ahmad to continuously track use status data indicat-

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Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25

Prior Art tual uses). Ex.1403 Figs. 5a-b; 2:22-24; 11:31-35; 11:44-50; 14:20-23. Ahmad also discloses retrieving use rules (e.g., reading a restriction on rental use specifying a licensed/permitted time of use or a licensed/permitted number of uses). Id. Figs. 5a-b; 2:65-3:17; 8:65-9:8 (“…Alternatively, a usage count rate may be used where the user rents the program module for a fixed number of uses. For example, the user may pay for ten uses of a particular program module where a single use is consumed each time the program module is run on the user’s computer.”); 10:27-32. See Ex.1419 132-133. Kopp47 also discloses retrieving use status data (e.g., recorded data regarding extent of actual utilization) and use rules (e.g., limitations specifying

ing level of usage of a digital work (e.g., amount of usage time or number of uses) to enforce the usage rights (e.g., expiration date; time of access allowed; number of uses allowed). Stefik’s repository system includes a parameter memory (e.g., descriptor storage) for storing rights and usage restrictions associated with content items stored on the repository. A POSA would have been motivated and found it obvious to implement Ahmad’s teachings of monitoring modules in the descriptor storage to continually monitor the rights and restrictions stored therein. See Ex.1419 134. 47

A POSA would have been motivated and found it obvious to implement Stefik and

Ahmad’s system using Kopp’s advantageous teachings of limiting data record usage to a purchased extent, as this would further Stefik and Ahmad’s goals in controlling usage while tying limits to a user’s desired purchase. Kopp’s system advantageously allows a user to tailor a product to specific needs and purchase only the needed extent of utilization. A POSA would have been motivated and found it obvious to employ Kopp’s advantageous customization in Stefik and Ahmad’s system to expand product

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Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25

code to evaluate said use status data and use rules to determine whether access is permitted to said second selected one or more items of retrieved multimedia content,

Prior Art purchased extent of utilization). Ex.1404 5:16-23; 6:40-48 (“Before the security device SEC allows the reading of a data record, it checks the recorded data in the record regarding the extent of utilization of the data record…”). See Ex.1419 134-135. Stefik discloses tracking available rights and determining if a user has remaining rights for a requested use (e.g., number of copy rights remaining) to determine whether access to the stored data is permitted (e.g., if requested data has associated usage rights that allow a user-requested function). Ex.1412 Abstract; 3:9-11 (“…the repository determining if the desired document has said instance of a usage right corresponding to the selected function…”); 4:44-46 ; 5:55-57; Ex.1413 Abstract; 6:42-55; 7:26-31 (“The check of the usage rights essentially involves a determination of whether a right associated with the access request ha been attached to the digital work and if all conditions associated with the right are satisfied.”); 10:28-32 and Table 1; 11:59-12:7; 14:15-27; 30:36-47; 31:26-35. When there is a copy restriction on the digital content (e.g., restriction stating that a requested action will not be performed if number of copies in use exceeds maximum allowed number), the copy condition is checked by the repository on which the digital work is stored. Ex.1413 19:12-15; 30:61-64. If the copy count is zero, the repository determines that the requested action is not permitted and terminates the transaction. Id. 31:47-62 (“Assuming that the copy count does not equal zero, the server checks if the copies in use for the requested right is greater than or equal to any copy count for the requested right (or relevant parts), step 1809. If the copies in use is greater than or equal to the copy count, this indicates that usage rights for the version of the transaction have been exhausted. Accordingly, the server terminates the transaction, step 1805. If the copy count is less than the copies in use for the transaction the transaction can continue, and the copies in use would be incremented by the number of digital works requested in the transaction, step 1810.”). If the copy count is not zero, the repository evaluates (e.g., compares) the number of copies in use and the copy count. Id. If the

offerings by allowing the user to specify the amount of desired usage and avoid paying for usage that is not needed. See, e.g., Ex.1404 2:61-65 (“This invention has the advantage that the data records sold in this manner become a consumable commodity. This makes it possible for a buyer to specify the extent of utilization he wants to pay only for that and to receive a data record which is only released to this extent of utilization.”). See Ex.1419 135.

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Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25

48

Prior Art number of copies in use is greater than the copy count, the repository determines that the number of allowed uses has been exhausted or exceeded and terminates the transaction without performing the requested action. Id. If the number of copies in use is less than the copy count, the repository determines that the requested action is permitted. Id. See Ex.1419 135-138. Ahmad48 discloses evaluating (e.g., comparing) the use status data (e.g., elapsed time of use; total number of uses) and the use rules (e.g., licensed/permitted time of use; licensed/permitted number of uses). Ex.1403 13:65-14:8 (“At decision step 650, the SM140 checks its database to determine whether usage time remains for the rented program module 100. If no usage time remains for the rented program module 100, the method follows the “NO” branch to step 640, and the program module 100 will generate an error message to the user corresponding to illegal usage of the program module 100. If, at step 650, usage time does remain for the rented program module 100, the method follows the “Yes branch through step 660. Referring now to FIGS. 4 and 5(b), at step 660, the SM 140 returns a valid message to the program module 100 to verify that use of the program module 100 is

A POSA would have been motivated and found it obvious to implement Stefik’s

repository system using Ahmad’s explicit teachings of comparing amounts of past use to total licensed amount of use in order to enforce use limitations on content and prevent unauthorized access. A POSA would appreciate the advantage of including a continuous monitor, like the Software Monitor of Ahmad, that responds to regular or irregular queries by checking use authorization to continuously verify that a user’s access to content is authorized. For example, in the context of a rented product (e.g., a digital work with a time-based restriction), a POSA would appreciate the benefit of employing Ahmad’s advantageous teachings of a monitor that continuously checks the content during use and ensure that access is terminated when the time restriction runs out (e.g., when authorization for the rental use ends). See Ex.1419 141-142.

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Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25

49

Prior Art authorized.”); 14:28-48. This evaluation (e.g., comparison) is performed to determine whether access is permitted to the stored data (e.g., whether a user is allowed to launch or continue to use a stored program module). Id. Figs. 5a-b; 2:65-3:17; 9:66-10:2 (“[T]he Software Monitor module is a software application that monitors and ensures that use of the rented program module 100 by the user is in accordance with the licensing information provided by the CICO module 120.”); 11:4-8. See Ex.1419 138-140. Kopp49 also discloses evaluating use status data (e.g., recorded data regard-

A POSA would have been motivated and found it obvious to implement the data

usage restricting system taught by Stefik and Ahmad using Kopp’s advantageous explicit teachings of checking purchased permitted utilization and the extent of actual utilization to further the goal of combating unauthorized use, as taught by all three references, based on a user-customized specified purchased amount of allowed use. The examples of restrictions in Kopp – for example number of utilizations, length of utilization time, time limit up to which data can be used – are some of the same limitations on usage taught by Stefik and Ahmad. A POSA would have been motivated and found it obvious to allow a user to custom-tailor these restrictions to avoid paying for use that is not needed, and then check the restrictions by comparing a total specified amount of usage with actual usage, as taught by Ahmad and Kopp. A POSA would appreciate the benefit of implementing Stefik’s flexible rights language to encode the user-tailored custom restrictions, for example by coding the userspecified extent of rental usage with a flexible time-based rights restriction that indicates the time restriction, as taught by Stefik. See Ex.1419 141-142.

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Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25

Prior Art ing extent of actual utilization) and use rules (e.g., limitations specifying purchased extent of permitted utilization) to determine whether access is permitted to the stored data (e.g., to determine whether permitted utilization remains and data record is allowed to be read). Ex.1404 6:19-20; 6:4147 (“Before the security device SEC allows the reading of a data record, it checks the recorded data in the record regarding the extent of utilization of the data record. If the extent of utilization of a data record has been exceeded, it does not permit the data record to be read. If an excessive time of utilization had been determined, it is advantageous to delete the data record immediately from the memory MEM.”). See Ex.1419 141. wherein said user Stefik discloses users navigating and selecting available multimeinterface is oper- dia content (e.g., digital works) using displays and commands enable to enable a us- tered at a user interface. Ex.1412 2:40-46 (“The user interface comprising a plurality of traversal keys for allowing a user to traverse lists of er to make said first user selection functions and documents, a select key to allow a user to select highlighted funcof said selected at tions or documents…”); 7:5-11; 10:45-48; Ex.1413 16:43-52. The least one item of content (e.g., digital works) available on the non-volatile memory multimedia content of a terminal (e.g., repository, such as a DocuCard) is presented to the user, and the user selects desired content through the user inavailable for reterface. Id. See Ex.1419 142-143. trieving, wherein said user Stefik discloses users navigating and selecting available multimeinterface is opera- dia content (e.g., digital works) using displays and commands enble to enable a user tered at a user interface. Ex.1412 2:40-46; 7:5-11; 10:45-48; to make said sec- Ex.1413 16:43-52. The content (e.g., digital works) available on ond user selection the non-volatile memory of a terminal (e.g., repository, such as a of said one or DocuCard) is presented to the user, and the user selects desired more items of re- content through the user interface. Id. See Ex.1419 143. trieved multimedia content available for accessing, and wherein said Stefik50 discloses enabling a user to access (e.g., controlling access) 50

A POSA would have considered it at minimum obvious to arrange for a multimedia

terminal (e.g., a repository, such as a DocuCard) to determine that access is permitted and then wait to receive an additional user selection at the user interface as confirmation that the user wishes to access the content before supplying the selected

71

Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25 Prior Art user interface multimedia content (e.g., digital works) responsive to code to control is operable to access permitting access (e.g., after verifying that rights and fee condienable a user tions allow the access). Ex.1412 Abs.; 7:5-11; 10:45-48; Ex.1413 Fig. to access said 18; Abs.(“system for controlling use an distribution of digital works…. repository second user se- will process each request to access a digital work by examining the corresponding lection of said usage rights. Digital work playback devices, coupled to the repository containing one or more the work, are used to play, display or print the work.”); 7:23-33; 18:33-38; item of retriev- 30:61-64; 32:22-47. The user’s access is provided by the user interface ed multimedia of a terminal (e.g., repository, such as DocuCard) that allows the user content reto view, select, and access the content. Ex.1413 16:43-52. The reposisponsive to tory functions, including enforcement of usage rights and access to said code to digital works, are performed by a processor (e.g., processor element control access 1201) implementing stored code (e.g., software instructions utilized by permitting ac- the processor element 1201). Ex.1413 14:15-27. See Ex.1419 144-146. cess to said se- Poggio51 discloses enabling a user to access (e.g., decode & store licond selected censed data) at least one selected item of multimedia content (e.g.,venone or more it- dor product) responsive to code to control access (e.g., only after an ems of reindication signifying successful completion of payment transaction is trieved multi- received). Ex.1415 Fig. 7; 9:56-10:40; 10:41-53. See Ex.1419 146-147. media content. Claim 26 Prior Art A handheld multimedia terminal as claimed in claim 25 [see Claim 25, above] further Stefik discloses providing a user with access to multimedia content (e.g., comprising digital works) if access is permitted (e.g., after verifying that rights and fee item. This would, among other things, advantageously allow a user to confirm he or she is prepared for the requested multimedia to begin. See Ex.1419 144-146. 51

A POSA would have been motivated and found it obvious to implement Stefik’s

system, including repositories interacting to distribute digital media, using Poggio’s advantageous explicit teachings of a VVM and a web server to distribute such media to client computers for access, including enabling a user to access content from the vending machine once such access is authorized. See Ex.1419 146-147.

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Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 25 code to present said second selected one or more items of retrieved multimedia content to a user via said display if access is permitted.

Claim 30 A data access terminal for controlling access to one or more 52

Prior Art conditions allow a requested action). Ex.1412 Abstract; Ex.1413 Fig. 18; Abstract; 7:23-33; 18:33-38; 30:61-64; 32:22-47. The user’s access is provided by the user interface and display of a terminal (e.g., repository, such as a DocuCard) that allows the user to view, select, and play the content. Ex.1413 16:43-. For example, a first selection (e.g., a loan or transfer transaction) is made to obtain the requested content, and a second selection (e.g., a play transaction) is made to play the content. Ex.1412 7:5-11; 10:45-48. In addition, a user can request multiple different works available from the same repository through separate selections of the desired content. Id. The functions of the repository, including enforcement of usage rights for digital works, are performed by a processor (e.g., processor element 1201) implementing stored code (e.g., software instructions utilized by the processor element 1201) to request, receive, process and display content. Ex.1413 14:15-27. See Ex.1419 148-150. Poggio discloses presenting multimedia content (e.g., accessing a vendor product when access is permitted (e.g., after payment has been accepted).52 Ex.1415 Fig. 7; 9:56-10:25; 10:41-53. See Ex.1419 150-151.

Prior Art Stefik discloses a repository that connects to multiple other repositories and operates as a data access terminal for controlling data access (e.g., retrieving and providing data). Ex.1413 Fig. 2; Abstract; 7:46-55 (“When in the server mode, the repository will be receiving and processing access requests to digital works. When in the requester mode, the repository will be initiating requests to access digital works…”); 13:43-46. The data access terminal (e.g., a repository operating as a data requester) retrieves data from a data carrier (e.g., a second repository serving as a data provider) and stores the data locally and/or

A POSA would have been motivated and found it obvious to implement Stefik’s

system, including media distribution security and payment features, using Poggio’s advantageous express teachings of a VVM arrangement and web server to distribute such media to client computers for access, including processing fee payments with external banking networks as part of distributing the media. See Ex.1419 150-151.

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Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 30 content data items stored on a data carrier, the data access terminal comprising:

53

Prior Art provides the retrieved data to a requesting user. Ex.1412 4:21-31. In particular, Stefik discloses a system in which multiple “repositories” (which may be, e.g., portable devices such as “DocuCards” or stationary devices such as a “kiosk”) acting in different capacities are in communication and transporting data among each other. Id. See Ex.1419 152-153. Stefik also discloses a repository having components that both store data, like a data carrier, and control access to the stored data, like a data access terminal. Ex.1412 6:32-39. A repository in Stefik includes a data access terminal (e.g., processing means 1200) located within a repository. 1413 at Fig. 12; 14:11-50. The data access terminal (e.g., processing means 1200) controls access to content data items (e.g. digital works; documents) by retrieving stored data items from a data carrier (e.g., storage system 1207) that is located within the repository and communicates with the data access terminal (e.g., processing means 1200) by an communications interface within the repository (e.g., lines between processing means 1200 and storage system 1207 in Fig. 12). Id. See Ex.1419 153-154. Sato also discloses accessing data items on a data carrier (e.g., stored data on removable IC card).53 Ex.1417 ¶ 9 (“portable music selection viewing device 70 provides a removable storage device 76 on a main body 71… storage device 76 is a memory card similar to, for example, a magnetic card, a magnetic tape, a CD, a DVD, or an IC card…”); ¶ 13 (“music storage device 240 connected to the music control unit 200 stores the music software. A music storage medium 250 such as a magnetic card, magnetic tape, a CD, a DVD, or a memory card such as an IC card stores the music software, and …can be removed and used on other audio units.”). See Ex.1419 154155. Poggio54 discloses a data access terminal (e.g., VVM) that controls consumer access to data items (e.g., vendor products). Ex.1415 Fig. 1; 2:20-23;

A POSA would have been motivated and found it obvious to implement Stefik’s

system, including security and payment features for distributions of digital media, using Sato’s advantageous explicit teachings of a mobile media device (such as a mobile phone) for accessing such media. See Ex.1419 154-155. 54

A POSA would have been motivated and found it obvious to implement Stefik’s

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Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 30

Prior Art 2:32-36; 4:35-39 (“The virtual vending machine 122 can be used to manage the distribution of electronic data and components thereof on a variety of license terms between the client computers 120 and the vendors 102.”); 5:50-53. The data access terminal (e.g., VVM) manages distribution and access to data on a data carrier (e.g., client computer). Id. See Ex.1419 155-156. a user in- Stefik discloses a data access terminal (e.g., repository, such as a DocuCard, terface; or a processor within a repository) that includes a user interface (e.g., display and buttons for user interaction). Ex.1412 Fig. 1; Abstract; 2:40-43 (“The user interface comprising a plurality of traversal keys for allowing a user to traverse lists of functions and documents, a select key to allow a user to select highlighted functions or documents…”); 5:22-27; Ex.1413 16:43-51 ; 16:61-65. See Ex.1419 156-157. a data car- In the context of a requesting repository retrieving data from a supplying rier inter- repository, Stefik discloses a data access terminal (e.g., requesting repositoface; ry, which may be a DocuCard), that includes an interface (e.g., an I/O port; external interface) with the data carrier (e.g., supplying repository). 1412 Abstract; 2:37-40; 4:23-31; 5:19-22; Ex.1413 7:46-48; 14:44-51. For example, a DocuCard is inserted into a PCMCIA slot of another repository or interfaces with a second DocuCard. Ex.1412 6:32-43. See Ex.1419 157. In the context of Stefik’s repository accessing local digital works, Stefik discloses that the data access terminal (e.g., processing means 1200) communicates with the data carrier (e.g., storage system 1207) over a communications interface (e.g., lines between storage system 1207 & processing means 1200 in Fig. 12) within the repository. Ex.1413 14:15-50. See Ex.1419 157-158. Poggio55 discloses an interface (e.g., web server) in a VVM that interfaces system (including, e.g., repositories in the form of portable “DocuCards” and others in form of, e.g., a “kiosk”) using Poggio’s explicit teachings of the use of a central VVM through which content can be obtained from other repositories. See Ex.1419 155-156. 55

A POSA would have been motivated and found it obvious to implement Stefik’s

system of repositories (including, e.g., “kiosk” and “DocuCard” repositories) using

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Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 30

a program store storing code implementable by a processor; and

Prior Art with a data carrier (e.g., client computer) and connects the data carrier to vendors and a library of vendor products. Ex.1415 Fig. 1; 2:53-56; 4:15-18; 4:50-56 (“The virtual vending machine 122 can include… a communications interface 208 for communication with the client computers 120 and the vendors 102 via the communications network 202.”); 5:20-22; 5:28-29. See Ex.1419 158. Stefik discloses a program store (e.g., ROM &RAM) within a data access terminal (e.g., in processing means 1200 within repository) that stores code implementable by a processor (e.g., software instructions utilized by processor element 1201 in performing the functions of a repository, for example with a control processor). Ex.1412 Abstract; 2:34-37; 5:45-47; Ex. 1413 14:22-27 (“processor memory 1202 would typically be further comprised of …ROM[ and]RAM [that] would contain the software instructions utilized by the processor element 1201 in performing the functions of the repository.”). See Ex.1419 158-159. Poggio56 also discloses a program store (e.g., memory) in a VVM that stores code (e.g., procedures) implementable by a processor (e.g., CPU).

Poggio’s explicit teachings of a VVM and web server to provide a central system, the VVm, through which requesting repositories are able to access content supplied by a number of other repositories, rather than requiring individual transactions with each of those other repositories. The requesters could, in this circumstance, more efficiently obtain content from provider repositories by communicating with a central device, the VVM, and one interface, the web server. See Ex.1419 158. 56

A POSA would have been motivated and found it obvious to implement Stefik’s

system (including, e.g., “kiosk” and “DocuCard” repositories) using Poggio’s explicit teachings of a VVM arrangement, including of software and processing logic to serve as both a provider to clients and a requester from vendors (like Stefik’s repositories), to simplify transactions required for content distribution. The VVM acts as a central

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Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 30

a processor coupled to the user interface, to the data carrier interface and to the program store for implementing the stored code, the code comprising:

Prior Art Ex.1415 Fig. 1; Fig. 2; 4:50-5:12 (“The virtual vending machine 122 can include a central processing unit (CPU) 204, a memory 210 (i.e., fast random access memory as well as non-volatile memory, such as disk storage)…. [In] Figs. 1 and 2, in the memory 210 . . . there can be stored the following components: an operating system 214; Internet access procedures 216; web server procedures 114…”). See Ex.1419 159160. In the context of a data-supplying repository that includes both a data access terminal (e.g., processing means 1200) and data supplier (e.g., storage system 1207), Stefik discloses a processor (e.g., processor element 1201) coupled to a first interface (e.g., by communications link within a repository to storage system 1207), data carrier interface (e.g., by external interface 1206), and program store (e.g., by communication link to processor memory 1202). Ex.1413 Fig. 12. In the context of a data-requesting repository that includes both a data access terminal (e.g., processing means 1200) and a data carrier (e.g., storage system 1207), Stefik discloses a processor (e.g., processor element 1201) coupled to a first interface (e.g., by external interface 1206), data carrier interface (e.g., by communications link within a repository to storage system 1207), and program store (e.g., by communication link to processor memory 1202). Id. See Ex.1419 160. Stefik also discloses that a repository connects with multiple other repositories, the repository having a processor (e.g., controllers and microprocessors such as processing element 1201) coupled to the first interface (e.g., external interface 1206 over which repository connects to second repository functioning in data supplier mode), to the data carrier interface (an external interface 1206 connected to repository functioning in data requester mode) and to the program store (e.g., processor memory 1202) executing communications with supplying repositories, requesting repositories, and data storage for a repository including processor memory storing code. Ex.1413 Fig.12; Ex.1412 6:32-39.57 The program store (e.g., proces-

location with which both providing and requesting repositories can communicate to simplify the transactions involved in content distribution. See Ex.1419 159-160. 57

A POSA would understand this disclosure of “at least one PCMCIA compliant

slot” to likewise disclose multiple PCMCIA slots. At a minimum, it would have been

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Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 30

Prior Art sor memory 1202) contains code (e.g., software instructions) implemented by the processor (e.g., utilized by processor element). Ex.1413 14:15-27. See Ex.1419 160-161. Poggio58 discloses a distributed computer system including a VVM with a processor (e.g., CPU) coupled to an interface (e.g., communications interface) for communications with client computers and vendors. Ex.1415 Fig. 1; Fig. 2; 4:33-35. The processor (e.g., CPU) implements stored code (e.g., procedures) that includes code for communicating with vendors (e.g., vendor administration interface procedures) and client computers (e.g., web server procedures). Id. 4:50-5:12. See Ex.1419 161-162. code to request identifier data identifying one See claim 25, “code to request identior more content data items available for refier data” limitation. trieving; code to receive said identifier data identifying See claim 25, “code to receive said said one or more content data items available identifier data” limitation. for retrieving; code to request content information pertaining See claim 25, “code to request content to at least one of said one or more content da- information” limitation. ta items identified by said identified data; code to receive said content information; See claim 25, “code to receive said content information” limitation. code to present said content information to a See claim 25, “code to present said user via said user interface pertaining to said content information” limitation. obvious to a POSA to have multiple PCMCIA compliant slots. See Ex.1419 161. 58

A POSA would have been motivated and found it obvious to combine Poggio with

Stefik to implement Stefik’s system using Poggio’s explicit teachings of a VVM arrangement so as to provide a configuration of repositories including a central unit to connect supplying repositories and requesting repositories, including Poggio’s teachings of employing a central control, including processing logic, for interfacing with data requesters, vendors, stored products, and payment systems. See Ex.1419 162.

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Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 30 Prior Art identified one or more content data items available for retrieving; code to receive a first user selection selecting See claim 25, “code to receive a first at least one of said one or more of said con- user selection to select at least one of tent data items available for retrieving; said one or more of said stored items of multimedia content” limitation. code responsive to said first user selection of See claim 25, “code . . . to transmit said selected at least one content data item to payment data” limitation. transmit payment data relating to payment for said selected at least one content item for validation by a payment validation system; code to receive payment validation data defin- See claim 25, “code to receive paying if said payment validation system has vali- ment validation data” limitation. dated payment for said selected at least one content data item; code responsive to the payment validation da- See claim 25, “code… to retrieve said ta to retrieve said selected at least one content selected at least one content data data item from a data supplier and to write item… and to write said retrieved at said retrieved at least one content data item in- least one content data item” limitato said data carrier; tion. code to receive a second user selection select- See claim 25, “code to receive a secing one of said one or more of said retrieved ond user selection” limitation; see also, content data items to access; e.g., Ex.1419 164-166. code to read use status data and use rules from See claim 25, “code to read use status said data carrier pertaining to said second se- data and use rules” limitation; see also, lected one or more retrieved content data e.g., Ex.1419 166-172. items; and code to evaluate said use status data and use See claim 25, “code to evaluate said rules to determine whether access is permitted use status data and use rules” limitato said second selected one or more retrieved tion; see also, e.g., Ex.1419 172-178. content data items. Claim 32 Prior Art A data access terminal as claimed in claim 30 (see claim 30, above), wherein said da- Stefik discloses interfacing a data access terminal (e.g., repository) ta access termi- with an audio/video player (e.g., audio CD player) and mobile nal is integrated communication device. Ex.1412 4:23-31 (“A DocuCard is used for storwith a mobile ing digital information which may be accessed by a system that is capable of communications playing or rendering the digital information, such as a computer system, digital device and au- copier, audio CD player and the like…”); Ex.1413 8:23-27; 13:48-50 79

Covered Business Method Patent Review United States Patent No. 8,336,772 Claim 30 Prior Art dio/video play- (“Repositories may be devices themselves, or they may be incorporated into other er. systems. An example is the rendering repository 205 of FIG. 2.”). See Ex.1419 179. V.

CONCLUSION Because this Petition, if unrebutted, shows it is more likely than not that these

claims are unpatentable, Petitioner requests trial and judgment that claims 25, 26, 30, and 32 of the ’772 are invalid. Per §§ 40.304 and 40.302(b), Petitioner, its real party in interest, and privies are not estopped from challenging the claims on the grounds identified. Per §§ 1.33(c), 42.205, and 42.300, a copy of this Request, in its entirety, is being served on Patent Owner at the address of record as reflected in the publiclyavailable records of the USPTO as designated in the PAIR system. The Director is authorized to charge any deficiency in the fees filed, asserted to be filed or which should have been filed herewith (or with any paper hereafter filed in this proceeding by this firm) to Deposit Account No. 061075, under Order No. 104677-5008-821. Respectfully submitted By: /J. Steven Baughman/

November 25, 2014

J. Steven Baughman (lead counsel) 47,414 Ching-Lee Fukuda (backup counsel) 44,334 Ropes & Gray LLP Megan F. Raymond, 72,997 1211 Avenue of the Americas Ropes & Gray LLP th One Metro Center, 700 12 St. – Ste. 900 New York, NY 10036 Washington, D.C. 20005-3948 P: 212-596-9336/ F:212-596-9000 P: 202-508-4606/ F: 202-383-8371 [email protected] [email protected] [email protected] Mailing address for all correspondence: ROPES & GRAY LLP, IPRM – Floor 43, Prudential Tower, 800 Boylston Street, Boston, MA 02199-3600

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IN THE UNITED STATES PATENT AND TRADEMARK OFFICE Inventor: Racz et al. United States Patent No.: 8,336,772 Formerly Application No.: 13/212,047 Issue Date: December 25, 2012 Filing Date: August 17, 2011 Former Group Art Unit: 2887 Former Examiner: Thien M. Le

§ § § § § § §

Attorney Docket No.: 104677-5008-821 Customer No. 28120 Petitioner: Apple Inc.

For: Data Storage and Access Systems MAIL STOP PATENT BOARD Patent Trial and Appeal Board United States Patent and Trademark Office Post Office Box 1450 Alexandria, Virginia 22313-1450

CERTIFICATE OF SERVICE It is certified that a copy of the following documents has been served in its entirety on the patent owner as provided in 37 CFR § 42.205: 1. Petition For Covered Business Method Patent Review of United States Patent No. 8,336,772 Pursuant to 35 U.S.C. § 321, 37 C.F.R. § 42.304 and accompanying exhibits:

1401

U.S. Patent No. 8,336,772

1402

Plaintiffs’ First Amended Complaint

1403

U.S. Patent No. 5,925,127

1404

U.S. Patent No. 5,940,805

1406

Russell Housley and Jan Dolphin, “Metering: A Pre-pay Technique,” Storage and Retrieval for Image and Video Databases V, Conference Volume 3022, 527 (January 15, 1997) U.S. Patent No. 4,999,806

1407

U.S. Patent No. 5,675,734

1408

U.S. Patent No. 4,878,245

1409

File History for U.S. Patent No. 8,336,772

1410

U.S. Patent No. 7,942,317

1411

U.S. Patent No. 5,103,392

1412

U.S. Patent No. 5,530,235

1413

U.S. Patent No. 5,629,980

1414

U.S. Patent No. 5,915,019

1415

European Patent Application, Publication No. EP0809221A2

1416

International Publication No. WO 99/43136

1417

JP Patent Application Publication No. H11-164058 (translation) Eberhard von Faber, Robert Hammelrath, and Frank-Peter Heider, “The Secure Distribution of Digital Contents,” IEEE (1997) Declaration of Anthony J. Wechselberger In Support of Apple Inc.’s Petition for Covered Business Method Patent Review U.S. Patent No. 8,033,458

1405

1418

1419 1420 1421 1422 1423

Declaration of Michael P. Duffey In Support of Apple Inc.’s Petition for Covered Business Method Patent Review Declaration of Megan F. Raymond In Support of Apple Inc.’s Petition for Covered Business Method Patent Review Claim Construction Memorandum Opinion from Smartflash LLC v. Apple Inc., No. 6:13cv447 (Dkt. 229)

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1424

File History for U.S. Patent No. 8,061,598

1425

U.S. Patent No. 4,337,483

1426

U.S. Patent No. 7,725,375

1427

International Publication No. WO 95/34857

1428 1429

JP Patent Application Publication No. H10-269289 (translation) File History for U.S. Patent No. 7,942,317

1430

File History for U.S. Patent No. 8,033,458

1431

U.S. Patent No. 8,061,598

1432

U.S. Patent No. 8,118,221

1433

File History for U.S. Patent No. 8,118,221

1434

U.S. Patent No. 7,334,720

1435

File History for U.S. Patent No. 7,334,720

1436

U.S. Patent No. 5,646,992

The copy has been served on November 25, 2014 by causing the aforementioned documents to be deposited in the United States Postal Service as Express Mail postage pre-paid in an envelope addressed to: DAVIDSON BERQUIST JACKSON & GOWDEY LLP 4300 Wilson Blvd., 7th Floor Arlington, VA 22203 (Label No. EF 070 057 761 US)

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Respectfully submitted, ROPES & GRAY LLP By /Megan Raymond / Megan Raymond

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