In its Final Written Decision, the Board held that claims 1-17 of the ’196 patent are unpatentable under §101. The Board also dismissed Patent Owner’s Motion to Exclude deposition testimony as moot because the Board’s determination did not rely on the testimony.
According to the Board, the ’196 patent is directed to a method for analyzing a performance of a financial product or asset having an irregular cash flow by “benchmarking the performance” of the asset relative to “a public market or other index.” Petitioner alleged claims 1-17 of the ’196 patent are unpatentable under § 101. The Board adopted the interpretations of claim terms provided by Patent Owner because Petitioner did not dispute them.
Petitioner asserted that the claims are directed to a mathematical computation that is an abstract idea. Patent Owner argued that when the claims are considered as a whole, they are not directed to an abstract idea. Patent Owner stated that the “scaling function” creates a second cash flow, a scaled version of cash flow, or a plurality of simulated cash flows that is a synthetic cash flow used in the computer model to analyze the real-life data. Petitioner contended this is merely a mathematical manipulation. The Board noted that the ’196 patent indicates that the steps of analyzing the performance of private equity assets relative to the performance of a public index were known prior to the invention of the ’196 patent. The Board agreed with Petitioner that the claims involve determining a mathematical correlation. That the ’196 patent does not expressly recite mathematical equations does not alter he determination that the claims were directed to an abstract idea.
Next, the Board addressed whether the claims recite significantly more than the abstract idea. Petitioner argued that the machine mentioned in the claims is a general purpose computer. Patent Owner argued that the inventive concept embodied by the scaling functions transforms irregular cash flow data into a second cash flow, which is the improvement on existing Public Market Equivalent (PME) benchmarking tools. Patent Owner argued that the claimed processors recited in the claims were meaningful limitations. In response, Petitioner asserted that an improved calculation even when tied to a specific use is unpatentable subject matter under § 101. The Board agreed with Petitioner. The Board stated that the subject claims merely recite the use of a computer for its ordinary function and are not patent eligible. Thus, the Board concluded that Petitioner had shown by a preponderance of the evidence that the challenged claims are unpatenable.
Finally, Patent Owner argued that the ’196 patent’s claims do not preempt the use of an abstract idea because there are numerous examples of different PME methods that do not use the scaling function. Petitioner argued that the upatentability of natural laws applies even if the natural law at issue is narrowly claimed. The Board declined to determine the degree to which the ’196 patent may preempt other method of analyzing financial data based on the above analysis.
CAMBRIDGE ASSOCIATES, LLC v. CAPITAL DYNAMICS, CBM2014-00079
Paper 28: Final Written Decision
Dated: August 31, 2015
Before: Francisco C. Prats, Grace Karaffa Obermann, and Donna M. Praiss
Written by: Praiss
Related proceedings: Capital Dynamics AG v. Cambridge Assocs., LLC, 1:13-cv-07766 (S.D.N.Y.)