Takeaway: The recitation in the challenged claims of communication or computer networks, display devices, point-of-sale devices, or the use of known technology, does not make a patent for a technological invention.

In its Final Written Decision, the Board determined that claims 1-4 of the ‘100 patent were unpatentable for claiming ineligible subject matter under 35 U.S.C. § 101. The ‘100 patent “generally relates to methods for coordinating financial transactions via a wireless network, for example, a wireless telephone network” and, in particular, disclosed methods that “allow a user, e.g., a customer or purchaser, to complete financial transactions at point-of-sale locations by using a wireless device, such as a wireless telephone, over a wireless network.”

The Board initially addressed whether the ‘100 patent was eligible for covered business method review. First, the Board discussed whether any claim of the ‘100 patent is “directed to a covered business method to be eligible for review.” “The presence in the challenged claims of financial terminology, or a method step requiring the movement of money, weighs strongly in favor of a financial product or service.” Petitioner argued that “every aspect of the ‘100 patent demonstrates its relation to the practice, administration or management of financial transactions,” which Patent Owner did not contest. Thus, “at least challenged claim 1 of the ‘100 patent meets the ‘financial product or service’ component of § 18(d)(1) of the AIA.” Second, the Board discussed whether the ‘100 patent is a technological invention. The Board considered two factors: “[(1)] whether the claimed subject matter as a whole recites a technological feature that is novel and unobvious over the prior art; and [(2)] solves a technical problem using a technical solution.” Petitioner argued that a “wireless device” and a “wireless network are “the only technological features recited in the challenged claims and that these features were neither novel nor unobvious as of December 23, 1997, the effective filing date of the ’100 patent.” The Board explained:

As the AIA’s legislative history makes clear, the recitation of communication or computer networks, display devices, or point-of-sale devices does not make a patent for a technological invention. 157 Cong. Rec. S1364. Moreover, as noted above, reciting the use of known technology, such as the wireless devices described in the Specification and recited in the challenged claims, to accomplish a method also does not make a patent for a technological invention. Id.

Moreover, “the technological solutions asserted by the Patent Owner are not recited in the challenged claims.” The Board further rejected Patent Owner’s argument relying upon the Patent Office’s classification system, stating that “[a]lthough it was anticipated that many covered business method patent reviews would be of patents classified in Class 705 of the United States Classification System, classification in Class 705 is not a substitute for the foregoing analysis of the claimed subject matter of the patent.” Accordingly, the Board found that the ‘100 patent is directed to a covered business method and thus eligible for covered business method review.

The Board next turned to claim construction “using the broadest reasonable interpretation in light of the specification of the patent.” The Board found that “the construction of two claim terms assists in our determination of whether the challenged claims recite patent eligible subject matter”: (1) “displaying point-of-sale locations to a user via one or more menus on the wireless device, the menus listing at least one point-of-sale location” and (2) “based upon a current location of the wireless device.” The Board construed the first term as “displaying at least one point-of-sale location to a user via one or more menus on the wireless device, the one or more menus listing at least one point-of-sale location.” The Board construed the second term as “based upon a current location of the user and the wireless device” and “without regard to the means used to determine that location.”

The Board then turned to its analysis of whether the challenged claims were directed to patent-eligible subject matter. As an initial matter the Board determined that the challenged claims are “directed to a method, i.e., a process.” The Board next addressed the “two-step framework for determining subject matter eligibility under 35 U.S.C. § 101.”

Under step one, the Board must determine whether the claims are directed to an abstract idea. The Board noted that “where the claims do no more than recite a fundamental economic practice and conventional hardware elements, and the recitation is directed to nothing more than the performance of that practice using those elements, such claims are directed to an abstract idea and are patent-ineligible.” The Board found that “[r]ead broadly, but reasonably, the challenged claims encompass the abstract idea of a transaction between a customer and a merchant.”

The Board turned to step two:

The Court has described step two of the Mayo framework as itself having two inquiries: (1) taking the claim limitations separately, does any step do more than use generic technology to perform the generic functions of that technology? and (2) considered “as an ordered combination,” do the technological components add anything that is not present already when the steps are considered separately?

Patent Owner argued that “the challenged claims require the use of location-determination technology and customized menus,” but the Board found that “the challenged claims are not written narrowly to require the use of such technology.” Further, the “displaying of point-of-sale locations to potential customers is well known.” Thus, “taking the claim limitations, including technological features, separately, [the Board determined] that the functions performed by the wireless device at each . . . of the recited method are purely conventional and perform only generic functions of that technology.” Moreover:

Considered “as an ordered combination,” the wireless device and wireless network of the recited method add nothing that is not already present in the method when the “displaying” and “transmitting” steps are considered separately. See Alice, 134 S. Ct. at 2359. Viewed as a whole, the recited methods of the challenged claims simply describe a transaction between a customer and a merchant, assisted or facilitated, but not fundamentally altered, by the use of a wireless device. See Ex. 1022 ¶ 31; Ex. 2007 ¶ 40. Patent Owner does not assert that the recited method steps, as a whole, improve the functioning of the wireless device or the wireless network. See Pet. Reply 4; Ex. 1022 ¶ 26. The recited claims do no more than apply the abstract idea of a customer-merchant transaction using a conventional wireless device, such as a wireless telephone.

Accordingly, “the technical features recited in the challenged claims do not add sufficiently to the method steps to render eligible the abstract idea covered by the claims subject matter for patent protection under 35 U.S.C. § 101.”

Finally, the Board analyzed the challenged claims briefly under the machine-or-transformation test and “[f]or the reasons discussed above,” determined “that Petitioner has shown by a preponderance of the evidence that the challenged claims are directed to subject matter that is ineligible for patent protection under 35 U.S.C. § 101.”

The Board lastly addressed Patent Owner’s motion to exclude evidence, specifically certain exhibits in whole or in part based on various objections. The Board was persuaded that the “declaration is rebuttal testimony, and the accompanying exhibits, fairly responded to Patent Owner’s contentions and [] testimony.” The Board provided various reasons for its conclusion, including: (1) Patent Owner provided only conclusory statements and failed “to explain adequately why [certain exhibits] were not responsive to the Patent Owner’s Response or [] declaration”; (2) the challenged testimony was treated “as an explanation for the basis of his opinions, not as expert testimony on United States patent law”; (3) Patent Owner’s objections “go more to the weight to be given this evidence, rather than to its admissibility”; and (4) the Board did not rely on certain of the exhibits in reaching its decision. Accordingly, Patent Owner’s Motion to Exclude Evidence was denied.

Square, Inc. v. Unwired Planet, LLC, CBM2014-00156
Paper 40: Final Written Decision
Dated: December 22, 2015
Patent: 7,711,100 B2
Before: James B. Arpin, Zhenyu Yang, and Kevin W. Cherry
Written by: Arpin
Related Proceedings: Unwired Planet LLC v. Square, Inc., No. 3:13-cv-00579-RCJ-WGC (D. Nev.).