Square Inc. v. Protegrity Corp.
Addressing a request for rehearing and to expand the panel, the Patent Trial and Appeal Board (PTAB or Board) found that it did not abuse its discretion in instituting a covered business method (CBM) review and declined to expand the panel. Square Inc. v. Protegrity Corp., Case No. CBM2014-00182 (PTAB, June 5, 2015) (Petravick, ALJ).
Petitioner Square Inc. requested a CBM review of a patent directed to a system and method for data processing. The PTAB instituted the review and found standing based on the fact that “at least claim 1 claims a method for performing data processing or other operations that are at least incidental or complementary to the practice, administration, or management of a financial product or service.”
The patent owner, Protegrity, contended that the PTAB abused its discretion with respect to standing because it misinterpreted the specification and the claims. In particular, according to the patent owner, the only reference to “banking” is in the portion of the specification entitled “Background Art,” while the claims merely describe a computer-implemented data processing method. The PTAB disagreed, noting that the term “financial product or service” in the statute should be interpreted broadly and explaining that the statute does not require “the literal recitation of the terms data processing of financial products or services . . . Rather, the patent claims must only be broad enough to cover a financial product or service.”
The patent owner also claimed that the PTAB abused its discretion by overlooking the fact that the claims were directed to a “technological invention.” But the PTAB again disagreed, concluding that at least claim 1 fails to recite a technological feature that is novel, unobvious or a technical solution to a technical problem. Specifically, the PTAB found that merely reciting a known technology, such as a database, typically does not turn a patent into a technological invention.
Finally, the patent owner asked that the panel of administrative patent judges be expanded to at least five, claiming that the institution of this CMB review conflicts with other PTAB decisions. However, the discretion to expand the panel rests with the chief judge, who declined to exercise that discretion in this case. Indeed, as the PTAB noted, the conflicting decisions cited by the patent owner were not binding on the panel and each decision rested upon the specific facts of those proceedings.