IN THE UNITED STATES PATENT TRIAL & APPEAL BOARD CQG, INC. and CQGT, LLC Petitioners, v. TRADING TECHNOLOGIES INTERNATIONAL, INC. Patent Owner. U.S. Patent No. 6,772,132 B1 PETITION FOR COVERED BUSINESS METHOD PATENT REVIEW UNDER 35 U.S.C. 321 AND 18 OF THE LEAHY-SMITH AMERICA INVENTS ACT Mail Stop PATENT BOARD Patent Trial and Appeal Board U.S. Patent & Trademark Office P.O. Box 1450 Alexandria, VA 22313-1450
I. Table of Contents II. Introduction... 1 III. Mandatory Notices (37 C.F.R. 42.8(b))... 1 A. Real Party-in-Interest... 1 B. Related Matters... 1 C. Lead and Back-up Counsel Including Service Information... 3 IV. Grounds for Standing (37 C.F.R. 42.304(a))... 3 A. CQG Has Standing to File a Petition Under 37 C.F.R. 42.302(a)... 3 B. CQG Is Not Estopped from Filing a Petition Under 37 C.F.R. 42.302(b) by Having Filed a Now-Dismissed DJ Action in 2005... 3 1. Institution of CBM Review Is Not Precluded by CQG s Earlier Filed Declaratory Judgment Action Because Such Action Was Dismissed Without Prejudice... 5 2. The Rules Promulgated by the PTO Under Section 18 of the AIA Do Not Prohibit Institution of CBM Review, Because a Petitioner First Filed a Declaratory Judgment Action... 10 3. 35 U.S.C. 325(a)(1) Does Not Apply to CBM Review and Does Not Bar the Institution of CBM Review that Is Initiated After the Filing of a Declaratory Judgment Action... 14 C. The 132 Patent Is Eligible for Covered Business Method Patent Review Under 37 C.F.R. 42.301... 18 i
1. The USPTO Has Already Determined that the 132 Patent Is a Covered Business Method Patent... 20 2. The 132 Patent Is Not for a Technological Invention... 23 3. The Claimed Subject Matter of the 132 Patent As a Whole Does Not Recite a Technical Feature that Is Novel and Unobvious Over the Prior Art... 24 4. The Claimed Subject Matter of the 132 Patent As a Whole Does Not Solve a Technical Problem Using a Technical Solution... 27 V. Identification of Challenge Under 37 C.F.R. 42.304(b)... 31 A. Specific Statutory Grounds of Challenge... 32 B. A Person of Ordinary Skill in the Art... 32 C. Claim Construction... 32 VI. Detailed Explanation of Reasons That Claims 1-56 of the 132 Patent Are Unpatentable... 34 A. Ground 1: Claims 1 56 Are Unpatentable Under 35 U.S.C. 101... 34 1. New PTO Guidelines... 36 2. Indicators of Abstract Ideas... 40 3. Economic Practices Are Abstract Ideas... 42 4. The 132 Patent Is Not Patentable Under 35 U.S.C. 101 Because All of Its Claims Are Directed to an Abstract Idea... 43 B. Ground 2: Claims 1 56 Are Unpatentable Under 35 U.S.C. 112, First Paragraph, for Lacking Sufficient Written Description of a Price column Where Only Some Prices Move, Not All... 58 ii
1. Claim Coverage... 60 2. Written Description... 61 3. Possession... 64 VII. Conclusion... 66 iii
II. Introduction Petitioners, CQG, Inc. and CQGT, LLC (collectively, CQG ) request Post- Grant Review of claims 1 56 of Covered Business Method Patent, U.S. Patent No. 6,772,132 ( the 132 patent ) (Ex. 1001). The 132 patent issued on August 3, 2004 and is owned by Trading Technologies International, Inc. ( TT ). (Id.) The Petitioner will show below that the claims of the 132 patent are unpatentable because they are directed to an abstract idea, and based on the broadest reasonable interpretation, lack written description. Accordingly, covered business method patent ( CBM ) review of claims 1 56 of the 132 patent should be granted. III. Mandatory Notices (37 C.F.R. 42.8(b)) A. Real Party-in-Interest The real parties-in-interest are CQG, Inc. and CQGT, LLC. B. Related Matters The 132 patent is or has been involved in the following proceedings that may affect, or be affected by, a decision in this proceeding: GL Trade Am., Inc. v. Trading Tech. Int'l, Inc. ( TT ), 1:11-cv-001558 (N.D. Ill.); TT v. TradeHelm, Inc., 1:10-cv-00931 (N.D. Ill.); TT v. Rosenthal Collins Group, LLC, 1:10-cv-00929 (N.D. Ill.); TT v. Open E Cry, LLC, et al., 1:10-cv-00885 (N.D. Ill.); TT v. thinkorswim Group, Inc., et al., 1:10-cv-00883 (N.D. Ill.); TT v. Tradestation Sec., 1
Inc., et al., 1:10-cv-00884 (N.D. Ill.); TT v. FuturePath Trading, LLC, 1:10-cv- 00720 (N.D. Ill.); TT v. Stellar Trading Sys., Ltd., et al., 1:10-cv-00882 (N.D. Ill.); TT v. Cunningham Trading Sys., LLC, et al., 1:10-cv-00726 (N.D. Ill.); TT v. BGC Partners, Inc., 1:10-cv-00715 (N.D. Ill.); TT v. CQG, Inc., et al., 1:05-cv-04811 (N.D. Ill.); TT v. IBG LLC, et al., 1:10- cv-00721 (N.D. Ill.); TT v. Orc Software, Inc., et al., 1:05-cv-06265 (N.D. Ill.); TT v. FuturePath Trading, LLC, 1:05-cv- 05164 (N.D. Ill.); TT v. Transmarket Group, LLC, 1:05-cv-05161 (N.D. Ill.); TT v. FFastFill PLC, Inc., 1:05-cv-04449 (N.D. Ill.); TT v. Strategy Runner, Ltd., 1:05- cv-04357 (N.D. Ill.); TT v. Rolfe & Nolan Sys., Inc., et al., 1:05-cv-04354 (N.D. Ill.); TT v. RTS Realtime Sys., Inc., et al., 1:05-cv-04332 (N.D. Ill.); TT v. Peregrine Fin. Group, Inc., 1:05-cv-04137 (N.D. Ill.); TT v. GL Consultants, Inc., et al., 1:05-cv-04120 (N.D. Ill.); Rosenthal Collins Group, LLC v. TT, 1:05-cv- 04088 (N.D. Ill.); TT v. Ninja Trader, LLC, 1:05-cv-03953 (N.D. Ill.); TT v. Patsystems NA LLC, et al., 1:05-cv-02984 (N.D. Ill.); TT v. Man Group PLC, et al., 1:05-cv-02164; TT v. Refco Group, Ltd., LLC, 1:05-cv-01079 (N.D. Ill.); TT v. Kingstree Trading, 1:04-cv-06740 (N.D. Ill.); TT v. Goldenberg Hehmeyer, 1:04- cv-06278 (N.D. Ill.); TT, et al. v. espeed, Inc., 1:04-cv-05312 (N.D. Ill.). 2
C. Lead and Back-up Counsel Including Service Information Lead counsel for Petitioners is Adam G. Kelly and back-up counsel is William J. Kramer and William J. Voller, III, of the law firm of Loeb & Loeb LLP having an address at 321 N. Clark St., Suite 2300, Chicago, IL 60654, telephone number (312) 464-3100, and facsimile number (312) 464-3111. Petitioners consent to service by email at the following email addresses: akelly@loeb.com, wkramer@loeb.com, and wvoller@loeb.com. IV. Grounds for Standing (37 C.F.R. 42.304(a)) A. CQG Has Standing to File a Petition Under 37 C.F.R. 42.302(a) CQG certifies that it meets the eligibility requirements of 37 C.F.R. 42.302(a) because TT sued CQG, Inc. and CQGT, LLC for infringement of the 132 patent. See TT v. CQG, Inc., 1:05-cv-04811 (N.D. Ill.). B. CQG Is Not Estopped from Filing a Petition Under 37 C.F.R. 42.302(b) by Having Filed a Now-Dismissed DJ Action in 2005 CQG filed a complaint for declaratory judgment action against TT challenging, inter alia, the invalidity of the 132 patent in the U.S. District Court for the District of Colorado on August 17, 2005 ( Colorado Action ). (Ex. 1003.) The Colorado Action was assigned Case No. 05-cv-01584. (Id.) Two days later, on August 19, 2005, TT sued CQG in the Northern District of Illinois ( Illinois Action ), which was designated Case No. 1:05-cv-04811. (Ex. 1004.) TT filed a 3
renewed motion to transfer the Colorado Action to the Northern District of Illinois on December 22, 2005. (Ex. 1005.) The renewed motion to transfer was granted on September 21, 2006, and the Colorado Action was transferred to the Northern District of Illinois the same day ( Transferred Colorado Action ). (Ex. 1006.) The Transferred Colorado Action was designated Case No. 1:06-cv-05222 by the Northern District of Illinois and assigned to Judge John W. Darrah, but was subsequently re-assigned to Judge James B. Moran on November 14, 2006, because the Illinois Action, Case No. 1:05-cv-04811, was pending before Judge Moran. (Ex. 1007.) On December 1, 2006, the Transferred Colorado Action, Case No. 1:06-cv- 05222, was dismissed without prejudice by Judge Moran. (Ex. 1008.) Contrary to TT s prior representations to the Northern District of Illinois, CQG is not estopped from filing this petition under 37 C.F.R. 42.302(b). First, the declaratory judgment action filed by CQG was dismissed without prejudice and, therefore, is considered to have never been filed. Second, the rules promulgated by the PTO under Section 18 of the Leahy-Smith America Invents Act ( AIA ) do not prohibit the filing of a declaratory judgment action before the filing of a petition for CBM review. Third, 35 U.S.C. 325(a)(1), which relates to Post-Grant Review ( PGR ), does not apply to CBM review. 4
1. Institution of CBM Review Is Not Precluded by CQG s Earlier Filed Declaratory Judgment Action Because Such Action Was Dismissed Without Prejudice Covered business method patent review of the 132 patent should be granted because CQG s declaratory judgment action was dismissed without prejudice prior to the filing of the present petition. Thus, it is considered to have never existed. Federal courts treat a civil action that is dismissed without prejudice as something that de jure never existed. Holloway v. U.S., 60 Fed. Cl. 254, 261 (Fed. Cl. 2004), aff d 143 F. App x 313 (Fed. Cir. 2005); see also Beck v. Caterpillar, Inc., 50 F.3d 405, 407 (7th Cir. 1995) ( [Plaintiff s] suit was dismissed voluntarily pursuant to [Rule] 41(a), and is treated as if it had never been filed. ). The Federal Circuit has consistently interpreted the effect of dismissals without prejudice as leav[ing] the parties as though the action had never been brought. See, e.g., Graves v. Principi, 294 F.3d 1350, 1356 (Fed. Cir. 2002); Jet, Inc. v. Sewage Aeration Sys., 223 F.3d 1360, 1364 (Fed. Cir. 2000). Similarly, the Board has found that civil actions dismissed without prejudice to have no preclusive effect. See Callidus Software Inc. v. Versata Software, Inc., Case CBM2013-00053, Decision to Institute (Paper No. 16), at p. 6 (P.T.A.B. Mar. 4, 2014) (holding that dismissal without prejudice indicates that judgment is not on the merits and will have no preclusive effect); see also Macuto U.S.A. v. BOS 5
GmbH & KG, Case IPR2012-00004, Decision to Institute (Paper No. 18), at pp.14 16 (PTAB Jan. 14, 2013) (holding that a dismissal without prejudice nullified the effect of service for purposes of 35 U.S.C. 315(b)). Thus, when an action is dismissed without prejudice, the parties are free to litigate the matter in a subsequent action, as though the dismissed action had never existed. Univ. of Pittsburgh v. Varian Med. Sys., Inc., 569 F.3d 1328, 1333 (Fed. Cir. 2009); see also 9 WRIGHT & MILLER, FED. PRAC. & PROC. CIV. 2367 (3d ed.); id. at nn. 6 & 9 (citing numerous cases throughout the courts of appeals). When a court permits a party to dismiss the declaratory judgment action voluntarily without prejudice, the party effectively unmakes that choice, and the action is considered never to have existed. Here, the court dismissed CQG s declaratory judgment action without prejudice prior to the filing of the present Petition. Therefore, the declaratory judgment action never existed, and CQG is not estopped from filing the present Petition. If TT attempts to rely on the Board s decision in Securebuy, LLC v. CardinalCommerce Corp., Case CBM2014-00035, Decision to Institute (Paper No. 13) (P.T.A.B. Apr. 25, 2014) (Precedential), or the Board s decision in Branch Banking & Trust Co. v. Maxim Integrated Products, Inc., Case CBM2013-00059, Decision Denying Institution (Paper No. 12) (P.T.A.B. Mar. 20, 2014), to support an 6
argument that the filing of a declaratory judgment action precludes the filing of a CBM petition, both cases can be distinguished from the present case. In SecureBuy, the petitioner filed a declaratory judgment action two weeks prior to the filing of its petition for CBM review, and the declaratory judgment action remained on-going at the time the Board issued its decision denying institution of CBM review. Securebuy, Decision to Institute (Paper No. 13), at p. 3. In Branch Banking, the petitioner filed a declaratory judgment action prior to filing its petition for CBM review. Branch Banking, Decision Denying Institution (Paper No. 12), at p. 3. The declaratory judgment action was consolidated into another action by order of the Judicial Panel on Multi-district Litigation and remained ongoing. Id.; Branch Banking, Ex. 1005, at pp. 6 7, n.2; (Ex. 1009, at p. 4.) Here, the declaratory judgment action filed by CQG is no longer pending as it was dismissed without prejudice in 2006 before the merits of the case were decided. In addition, there were no orders consolidating the Transferred Colorado Action with the Illinois Case. 1 The Board s decisions in SecureBuy and Branch Banking, therefore, 1 Although TT filed a motion in the Illinois Case to consolidate the Transferred Colorado Action with the Illinois case (Ex. 1010), an order ruling on the motion was never entered by the court. (See Ex. 1011); see also footnote 2, infra. 7
are not applicable to the present Petition, and CQG s petition for institution of CBM review of the 132 patent should be granted. Further, TT will likely attempt to rely on Apple Inc. v. Rensselaer Polytechnic Institute, Case IPR2014-00319, Decision Denying Institution (Paper No. 12) (P.T.A.B., Jun. 12, 2014). In that case, a first infringement complaint was filed by Dynamic Advances, LLC against Apple, Inc. on October 19, 2012 (Dynamic I), and a second infringement complaint was filed by Dynamic Advances, LLC in conjunction with Rensselaer Polytechnic Institute ( RPI ) against Apple, Inc. on June 3, 2013 (Dynamic II). Id., at p. 3. The court ordered the consolidation of the two actions and dismissed Dynamic I without prejudice. Id. The Board concluded that because Dynamic I was consolidated with Dynamic II, Dynamic I remained pending and presented a time bar to the petition for Inter Partes Review filed by Apple, Inc. on January 3, 2014. Id., at p. 7 ( [W]e conclude that the Dynamic I case did not cease in the same sense as a complaint dismissed without prejudice it was consolidated with another case, and its complaint cannot be treated as if it never existed. (emphasis added)). Here, the Illinois Action and the Transferred Colorado Action were not consolidated. Notably, in Apple, the parties had filed a Stipulated Joint Request to Coordinate Civil Actions, which was signed and entered by the court. Apple, 8
Ex. 1022, at p. 1. The stipulated joint request specifically requested that the court coordinate the two actions, and indicated how the two actions were to be combined. Id., at p. 2 (E.g., All disclosures, discovery, and filings by Dynamic Advances... in [Dynamic I] are hereby deemed to have occurred in [Dynamic II] as made jointly by both Dynamic Advances and RPI, including all reservation of rights. ) No such stipulation was filed in the Transferred Colorado Action or the Illinois Action nor is there any order stating that the Transferred Colorado Action and Illinois Action were consolidated. (see Ex. 1011.) The order filed by Judge Moran in the Transferred Colorado Action states that the case is dismissed without prejudice plain and simple. 2 (Ex. 1008.) There is no mention of 2 TT may argue that CQG submitted a proposed order to Judge Moran that, if signed, would have granted TT s Motion for Consolidation of the Transferred Colorado Action with the Illinois Action, see footnote 1, supra, and granted dismissal of the Transferred Colorado Action without prejudice and leave for CQG to file an amended answer and counterclaims. (See Ex. 1012.) But that proposed order was never entered by court. Instead, the court entered an order that granted dismissal without prejudice (Ex. 1008) and later entered an order that granted CQG leave to amend (Ex. 1013). Again, an order granting consolidation was not entered. TT may also argue that the order granting CQG leave to amend its Answer in the Illinois Action is effectively a consolidation, but this was not the case. 9
consolidation, coordination, or incorporation of the claims of the Transferred Colorado Action into the Illinois Action. Thus, unlike Apple, consolidation did not occur, and the Colorado Action should be treated as not having been filed. Accordingly, the filing of the Colorado Action does not bar the present Petition for CBM review. 2. The Rules Promulgated by the PTO Under Section 18 of the AIA Do Not Prohibit Institution of CBM Review, Because a Petitioner First Filed a Declaratory Judgment Action In addition, CQG is not estopped from filing the present Petition because the rules promulgated by the PTO under Section 18 of the AIA do not prohibit CBM Granting leave to amend, merely gives a party the opportunity to withdraw or add counterclaims at its discretion it does not automatically combine the claims of one action into another. Tellingly, CQG did not simply roll the claims of the Colorado Action into the Illinois Case. In fact, the counterclaims in CQG s Amended Answer in the Illinois Case differ significantly from those claims presented by CQG in the Amended Complaint filed in the Colorado Action. (Compare Ex. 1014, pp. 6 11, with Ex. 1015, pp. 4 8.) Most notably, CQG s Amended Answer in the Illinois Case includes a counterclaim requesting a declaratory judgment of unenforceability based on inequitable conduct (Ex. 1014, p. 7), which was not presented in the Colorado Action. (Ex. 1003, p. 4; 1015, pp. 4 8.) Thus, treating the order granting CQG leave to amend does not equate to an order of consolidation. 10
review after the filing of a declaratory judgment action. Section 18 created a transitional program providing for the review of covered business method patents by the USPTO. Congress intent behind Section 18 of the AIA was to provide a cost-effective alternative to litigation to examine business method patents. See 112 Cong. Rec. S1363 (daily ed. Mar. 8, 2011) (statement of Sen. Leahy). Under Section 18 of the AIA, Congress mandated the PTO to establish procedures for instituting and conducting covered business method patent reviews. See AIA 18(a)(1) ( Not later than the date that is 1 year after the date of the enactment of this Act, the director shall issue regulations establishing and implementing a transitional post-grant review proceeding for review of the validity of covered business method patents. ). Section 18 also provided that the transitional program shall employ the standards and procedures of a post-grant review under chapter 32 of title 35 subject to Sections 18(a)(1)(A) (E). Sections 18(a)(1)(A) (E) of the AIA provide certain exceptions to the standards and procedures relating to PGRs and also provide specific requirements for CBM reviews. In particular, Section 18(a)(1)(A) states that 35 U.S.C. 321(c) and 325(b), (e)(2), and (f), do not apply to CBM reviews. Section 18(a)(1)(B) establishes a case or controversy requirement for CBM reviews as opposed to a 9-month window (as required for PGRs) for when a petition can be 11
filed. Id. ( A person may not file a petition for transitional [CBM Reviews] proceeding... unless the person... has been sued for... or charged with infringement.... ). Section 18(a)(1)(C) establishes the availability of certain prior art in a CBM review that is not available in a PGR. Section 18(a)(1)(D) establishes a separate estoppel provision for CBM reviews; and, Section 18(a)(1)(E) limits CBM reviews to covered business method patents. Pursuant to the grant of authority by Congress under the AIA and consistent with Congressional intent, the PTO through its then existing Board of Patent Appeals and Interferences promulgated rules to implement the AIA 3, including CBM reviews. The specific rules applicable to CBM reviews are 37 C.F.R. 42.300-304. Section 42.300(a) provides that: 42.300 Procedure, pendency. (a) A covered business method patent review is a trial and subject to the rules set forth in subpart A and also subject to the post-grant review procedures set forth in subpart C except for 42.200, 42.201, 42.202, and 42.204. 37 C.F.R. 42.300(a) (emphasis added). 3 Preliminary notice of the rules was published in February 10, 2012, at 77 Fed. Reg. 7080, 7080 095 (Feb. 10, 2012). Following a comments period, the final rules were published August 14, 2012, at 77 Fed. Reg. 48680, 48680 732 (Aug. 14, 2012). 12
Section 42.201 is one of the sections relating to PGRs that was expressly exempted from applying to CBM review by the PTO. Section 42.201 states in relevant part that a person may institute post-grant review unless: Before the date on which the petition for review is filed, the petitioner or real party-in-interest filed a civil action challenging the validity of a claim of the patent[.] Although Section 18 of the AIA provides that CBM reviews shall employ the standards and procedures of [,] a post-grant review under chapter 32 of title 35, United States Code, it does so with several exceptions. AIA 18 (a)(1). Nowhere in Section 18 of the AIA does it state that only those subsections specifically listed in AIA 18 (i.e., 35 U.S.C. 321(c) and 325(b), (e)(2), and (f)) do not apply to a CBM review, or that other exceptions could not be included by the USPTO when it promulgated its rules). Because 37 C.F.R. 42.201, which prohibits the filing of a PGR if a petitioner first filed a civil action challenging the validity of the patent, is expressly exempt from applying to CBM review, the filing of petition for CBM review is not barred by an earlier filing of a civil action by the petitioner. Thus, under Rule 42.300(a), CQG is not estopped from filing the present petition. 13
3. 35 U.S.C. 325(a)(1) Does Not Apply to CBM Review and Does Not Bar the Institution of CBM Review that Is Initiated After the Filing of a Declaratory Judgment Action Finally, 35 U.S.C. 325(a)(1) neither applies to CBM review, nor does it prohibit the institution of CBM review that is initiated after the filing of a declaratory judgment action. Some Board panels have incorrectly denied institution of CBM review because the petitioner filed a petition for CBM review after it filed a civil action challenging the validity of the patent-at-issue. See, e.g., Securebuy, Decision to Institute, supra. The panels in such cases cited 35 U.S.C. 325 as the basis for their denial of CBM review. But, reliance on 35 U.S.C. 325 for the proposition that the filing of a declaratory judgment action precludes the ability to later file a petition for CBM review is incorrect. Section 325 states in relevant part: 325. Relation to other proceedings or actions (a) INFRINGER S CIVIL ACTION. 35 U.S.C. 325(a)(1). (1) POST-GRANT REVIEW BARRED BY CIVIL ACTION. A post-grant review may not be instituted under this chapter if, before the date on which the petition for such a review is filed, the petitioner or real party in interest filed a civil action challenging the validity of a claim of the patent. 14
On its face, 35 U.S.C. 325 does not apply to CBM reviews. Section 325 was promulgated under Section 6 of the AIA, and was codified under Chapter 32 of Title 35 of the United States Code. In considering the application of a statute to a set of facts, the starting point for such an analysis is the language of the statute itself. Southeastern Community College v. Davis, 442 U.S. 397, 405 (1979). And, unless otherwise defined, words will be interpreted as taking their ordinary, contemporary, common meaning. Perrin v. U.S., 444 U.S. 37, 42 (1979). Post-Grant Review, Inter Partes Review, and CBM Review are separate post-issuance reviews of patents created under the AIA. See, e.g., AIA 6 (a) (Inter Partes Review), 6 (d) (Post-Grant Review), and 18 (Transitional Program for Covered Business Method Patents). As noted above, 35 U.S.C. 325 is directed to Post-Grant Review, not the Transitional Program for Covered Business Method Patents (established by uncodified Section 18 of the AIA). Chapter 31 of Title 35 of the U.S. Code, which was also promulgated under Section 6 of the AIA, has a similar statute, but is directed to Inter Partes Review. See 35 U.S.C. 315. Tellingly, there are no similar statutes relating to Section 18 of the AIA, directed to CBM reviews. Congress could have, but did not, promulgate a statute corresponding to 35 U.S.C. 315 or 325 expressly barring institution of a CBM review if the 15
petitioner earlier filed a civil action challenging the validity of the patent. Instead, Congress delegated the authority to draft rules and regulations governing CBM reviews to the Director of the USPTO. AIA 18(a)(1). The Director should be guided by the instruction that [t]he transitional proceeding implemented pursuant to this subsection shall be regarded as, and shall employ the standards and procedures of, a post-grant review under chapter 32 of title 35, United States Code, subject to certain exceptions. Id. Congress, however, did not command the Director to draft rules matching the constraints of the Chapter 32 statutes. Considering the differences between CBMs and PGRs, the Director promulgated rules. And the rules, specifically 37 C.F.R. 42.300(a), exempted CBM reviews from being barred by an earlier filing of a declaratory judgment action against the patent. This is fully consistent with legislative intent, with AIA 18(a)(1)(B), and was declared consistent by the PTO. Further, 37 C.F.R. 42.302, which relates to who can petition for CBM review, does not prohibit the filing of a declaratory judgment action prior to the filing of a petition for CBM review. Section 42.302 states, in relevant part, as follows: 42.302 Who may petition for a covered business method patent review. (a) A petitioner may not file with the Office a petition to institute a 16
covered business method patent review of the patent unless the petitioner,... has been sued for infringement of the patent or has been charged with infringement under that patent.... (b) A petitioner may not file a petition to institute a covered business method patent review of the patent where the petitioner, the petitioner's real party-in-interest, or a privy of the petitioner is estopped from challenging the claims on the grounds identified in the petition. Id. (emphasis added.) Section 42.302, which is direct to CBMs, mirrors and replaces 37 C.F.R. 42.201, which relates to PGRs. Section 42.201 reads as follows: 42.201 Who may petition for a post-grant review. A person who is not the owner of a patent may file with the Office a petition to institute a post-grant review of the patent unless: (a) Before the date on which the petition for review is filed, the petitioner or real party-in-interest filed a civil action challenging the validity of a claim of the patent; or (b) The petitioner, the petitioner's real party-in-interest, or a privy of the petitioner is estopped from challenging the claims on the grounds identified in the petition. Id. (emphasis added.) Clearly, Section 42.302(a) replaces Section 42.201(a), and Section 42.302(b) corresponds to Section 42.201(b). Thus, the estoppel provision for 17
CBMs, Section 42.302(b), does not expressly preclude the filing of a petition for CBM review if a declaratory judgment action was filed first. Section 42.302(a) only precludes challenging the claims on the grounds identified in the petition. Because there has been no prior adjudication on the merits of the grounds raised in the present petition (e.g., invalidity under 35 U.S.C. 101,102, 103, and 112), CQG is not estopped from challenging the claims on the grounds identified in the present Petition under 37 C.F.R. 42.302(b). C. The 132 Patent Is Eligible for Covered Business Method Patent Review Under 37 C.F.R. 42.301 A patent is eligible for CBM review if the patent 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. 37 C.F.R. 42.301 (a); see also AIA 18(d)(1) (a covered business method 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 ). A patent is for a technological invention if the claimed subject matter as a whole recites a technological feature that is novel and unobvious over the prior art; and solves a technical problem using a technical solution. 37 C.F.R. 42.301(b). 18
To determine whether a patent is eligible for a covered business method patent review, the focus is on the claims. Transitional Program for CBM Patents Definitions, 77 Fed. Reg. 48734, 48736 (Aug. 14, 2012). A patent needs only one claim directed to a covered business method to be eligible for review. Id. at 48736. In promulgating rules for covered business method patent reviews, the PTO considered the legislative intent and history behind the AIA s definition of covered business method patent. Id. at 48735 736. The legislative history explains that the 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. Id. (citing 157 Cong. Rec. S5432 (daily ed. Sept. 8, 2011) (statement of Sen. Schumer)). The legislative history indicates that financial product or service should be interpreted broadly. Id. Therefore, the PTO has broadly defined the term covered business method patent to encompass patents claiming activities that are financial in nature, incidental to a financial activity or complementary to a financial activity. See id. at 48735; see also SAP Am., Inc. v. Versata Dev. Grp., Inc., Case CBM2012-00001, Decision to Institute (Paper No. 36), at p. 23 (PTAB Jan. 9, 2013). 19
As discussed in more detail below, the 132 patent is a covered business method patent and not directed to a technical invention. Accordingly, CBM review of the 132 patent should be instituted. 1. The USPTO Has Already Determined that the 132 Patent Is a Covered Business Method Patent TD Ameritrade previously filed a CBM petition against the 132 patent. The Board carefully reviewed the 132 patent and found that it is a covered business method patent and is eligible for covered business method patent review. TD Ameritrade Holding Corp. v. Trading Tech. Int l, Inc., Case CBM2014-00135, Decision to Institute (Paper No. 19), at pp. 7 12 (PTAB Dec. 2, 2014) (granting Petitioner s petition for covered business patent review) (Ex. 1016.) Anticipating that TT will argue that the 132 patent is not eligible for covered business method patent review, despite the Board s ruling to the contrary, CQG will briefly address the eligibility of the 132 patent for covered business method patent review. a. Classification Under the plain language of 37 C.F.R 42.301(a), the 132 patent squarely qualifies as a covered business method patent. According to the PTO, patents subject to covered business method patent review are typically classifiable in Class 705. See, e.g., Transitional Program for CBM Patents Definitions, 77 Fed. Reg. at 48739. Class 705 relates to Data Processing: Financial, Business Practice, 20
Management, or Cost/Price Determination. Although not entirely dispositive of its qualification as a covered business method patent, the claimed systems and methods of the 132 patent are classified in Class 705. Specifically, the following classes were included on the front of the 132 patent (with class 705/37 being identified as the primary class). 705/35 Finance (e.g., banking, investment or credit) 705/36 Portfolio selection, planning or analysis 705/37 Trading, matching, or bidding Tellingly, the PTO s classification demonstrates that the 132 patent is financial in nature and fall under the definition under 42.301(a). b. Claim Language Taking independent claims 1, 8, and 14 as representative claims, there are several phrases that indicate the claims are financial in nature. The preamble of claims 1, 8, and 14 call for the placement of a trade order for a commodity, an electronic exchange, an inside market, a highest bid price, and a lowest ask price. (Ex. 1001, independent claims 1, 8, and 14.) Although TT may argue that the claims can be applied to other situations, the clear intent of the claims is to cover financial transactions. 21
Additional claim limitations further emphasize that the 132 patent qualifies for CBM review. The first and second bulk element of claims 1, 8, and 14 describe the bid/buy and ask/sell side of a transaction for a commodity in the market. For example, the first bulk element describes setting a preset parameter for the trade order and the second bulk element describes displaying market depth of a commodity... including the bid and ask quantities of the commodity, aligned with a static display of prices corresponding thereto.... (Id.) The third bulk element of claims 1 and 8 displays an order entry region for sending trade orders, again, where trade order is a term commonly used in the financial market. 4 (Id., independent claims 1 and 8.) The fourth bulk element of claims 1, 8, and 14 discusses the selection of an area in the order entry region, setting additional parameters for the trade order, and sending the trade order to the electronic exchange. (Id., independent claims 1, 8, and 14.) Examining the elements, the 132 patent is directed to the abstract concept of placing an order, which includes bid and ask transactions, based on observed market information, as well as updating the market information. As is well-known, 4 The second bulk element of claim 14 of the 132 patent includes the limitations discussed regarding the third bulk element of claims 1 and 8. And, the third bulk element of claim 14 discusses the positioning a pointer of a user input device over an area of the order entry region. (Ex. 1001, independent claim 14.) 22
bid and ask transactions form the basis of any financial market. Clearly, the claims of the 132 patent are directed to a financial market and directed to subject matter that is covered by the CBM review process. 2. The 132 Patent Is Not for a Technological Invention The definition of a covered business method patent in Section 18(d)(1) of the AIA does not include patents for technological inventions. A technological invention is determined by considering whether the claimed subject matter as a whole recites a technical feature that is novel and unobvious over the prior art; and solves a technical problem using a technical solution. 37 C.F.R. 42.301(b). As noted previously, the Board found in the TD Ameritrade decision that the 132 patent is not a technical invention. (Ex. 1016, pp. 10 12.) Even though the Board has found to the contrary, TT will likely continue to argue that its patents are technical. But the 132 patent is not for a technological invention, because it does not solve a technical problem with a technical solution. Instead, it recites the ordinary application of old, well-understood data display and graphical user interface techniques. The following claim drafting techniques typically do not render a patent a technological invention: (a) Mere recitation of known technologies, such as computer hardware, communication or computer networks, software, memory, 23
computer-readable storage medium, scanners, display devices or databases, or specialized machines, such as an ATM or point of sale device. (b) Reciting the use of known prior art technology to accomplish a process or method, even if that process or method is novel and non-obvious. (c) Combining prior art structures to achieve the normal, expected, or predictable result of that combination. Office Patent Trial Practice Guide, 77 Fed. Reg. 48756, 48763 764 (Aug. 14, 2012). 3. The Claimed Subject Matter of the 132 Patent As a Whole Does Not Recite a Technical Feature that Is Novel and Unobvious Over the Prior Art The first prong of the technological invention analysis is whether the claims as a whole recite a technical feature that is novel and unobvious over the prior art. As described in detail herein, the claims of the 132 patent do not recite a technical feature that is novel or unobvious over the prior art. Rather, they recite only wellunderstood, routine, and conventional steps of displaying market information graphically to a trader, who enters buy and sell orders, and sending the trader s orders to an exchange to be executed. The process of placing an order, which includes bid and ask transactions, based on observed market information, as well as updating the market information, 24
is well-known, as well as user interfaces that facilitate this process. The patentee admits in the background section of the 132 patent that: At least 60 exchanges throughout the world utilize electronic trading in varying degrees to trade stocks, bonds, futures, options and other products. (Ex. 1001, 1:21 23.) The use of a graphical user interface to facilitate the process of matching buyers with sellers is not novel or non-obvious. (See Report of Steven Van Dusen, Ex. 1017, 24.) In addition, there were a significant number of additional patents cited during prosecution of the 132 patent that disclose a graphical user interface in the context of an electronic exchange. (Ex. 1002.) In fact, FIG. 2 of the 132 patent, which shows the state of the prior art, demonstrates that the use of a graphical user interface to place an order (i.e., bid or ask transactions) for a commodity on an electronic exchange was well-known at the time the patent was filed. (Ex. 1001, 5:11 17.) Further, the 132 patent does not disclose, nor are the claims directed to, any new computer hardware. Rather, the claims have been crafted to recite software and only general computer components, such as a graphical user interface, a user input device, program code, and a display device. (Ex. 1001, independent claims 1, 8, and 14.) These components are not technologically novel or non-obvious. They are generic and are known technology. Even the 25
specification of the 132 patent acknowledges that the alleged invention requires only a generic computer or [an] electronic terminal... able to communicate directly or indirectly... with the exchange. (Id., 3:64 67.) Congress did not intend a patent with such basic, well-known technology disclosures to be inoculated from CBM review: [The technological inventions exception] is not meant to exclude patents that use known technology to accomplish a business process or method of conducting business whether or not that process or method appears to be novel. The technological invention exception is also not intended to exclude a patent simply because it recites technology. For example, the recitation of computer hardware, communication or computer networks, software, memory, computerreadable storage medium, scanners, display devices or databases, specialized machines, such as an ATM or point of sale device, or other known technologies, does not make a patent a technological invention. In other words, a patent is not a technological invention because it combines known technology in a new way to perform data processing operations. 157 Cong. Rec. S1364 (daily ed. Mar. 8, 2011) (Sen. Schumer). TT will also argue that the 132 patent addresses one or more technical problems such as creating a display to efficiently match buyers and sellers and facilitate the sending of trade orders. The basic idea of placing trade orders has 26
been around since Western Frontier era trading posts. In reality, the TT solution uses known technology to reach an entirely predictable end. 4. The Claimed Subject Matter of the 132 Patent As a Whole Does Not Solve a Technical Problem Using a Technical Solution The analysis could stop here, as the technological invention exception does not apply when even one prong of 37 C.F.R. 42.301(b) is not met. Regardless, the 132 patent also fails to satisfy the second prong of 37 C.F.R. 42.301(b) because the claims do not solve a technical problem using a technical solution. There is no technical problem being addressed. The problem is directed to placing a trade order for a commodity on an electronic exchange. Even the 132 patent admits that at the time of filing least 60 exchanges throughout the world utilized electronic trading systems to trade stocks, bonds, futures and options, and allowed traders to participate in the market. (Ex. 1001, 1:21 23, 1:61 63.) Placing an order on the exchange is not a novel technical problem. a. Plain Language TT will argue the legislative history favors exempting the 132 patent. In interpreting any statute, the first place to start is the language of the statute itself. [C]anons of construction are no more than rules of thumb that help courts determine the meaning of legislation, and in interpreting a statute a court should always turn first to one, cardinal canon before 27
all others.... [C]ourts must presume that a legislature says in a statute what it means and means in a statute what it says there. When the words of a statute are unambiguous, then, this first canon is also the last: judicial inquiry is complete. Connecticut Nat l Bank v. Germain, 503 U.S. 249, 253 54 (1992) (citations omitted). Here, the unambiguous language of the statute covers the 132 patent. First, the patent covers a method of manipulating or adjusting prices for financial products. Second, the patent also covers the financial service of placing orders for financial instruments. b. Legislative History CQG sees little merit in looking beyond the unambiguous words of the statute and the words of the claims. But, in anticipation of TT s arguments to the contrary, CQG will discuss the relevant legislative history. In examining the legislative history related to the statute for CBM Review, the PTO explained that that financial product or service should be interpreted broadly, encompassing patents claiming activities that are financial in nature, incidental to a financial activity or complementary to a financial activity. Transitional Program for CBM Patents Definitions, 77 Fed. Reg. at 48735. 28
The 132 patent meets this definition. It expressly claims displaying market information relating to and facilitating trading including displaying bids and asks in the market, setting parameters for a trade order, and sending the trade order to the electronic exchange. (See Ex. 1001, independent claims 1, 8, and 14.) Likewise, the patent describes a graphical user interface for trading such as that shown in FIGs. 3 5 of the 132 patent. TT will likely point to statements from Senator Durbin regarding the scope of the statute. Senator Durbin, like some other Senators, sought to add comments to influence the interpretation of the statute. At a high level, three areas were discussed in the legislative history before the bill passed as deserving special treatment: 1. Tax Strategies; 2. Bill Counters; and 3. User Interfaces for Commodities. Both tax strategies and bill counters received specific sections while the statute is silent as to user interfaces for commodities. Specifically, for tax strategies, AIA Section 14 states that tax strategies are deemed within the prior art. 5 Similarly, cash counting machines were deemed to 5 SEC. 14. TAX STRATEGIES DEEMED WITHIN THE PRIOR ART. (a) IN GENERAL.--For purposes of evaluating an invention under section 102 or 103 of title 35, United States Code, any strategy for reducing, avoiding, or deferring tax liability, whether known or unknown at the time of the invention or 29
be outside the business method program. 6 Despite the statements of Senator Durbin, the statute is silent as to trading interfaces. application for patent, shall be deemed insufficient to differentiate a claimed invention from the prior art. (b) DEFINITION.--For purposes of this section, the term tax liability refers to any liability for a tax under any Federal, State, or local law, or the law of any foreign jurisdiction, including any statute, rule, regulation, or ordinance that levies, imposes, or assesses such tax liability. (c) EXCLUSIONS.--This section does not apply to that part of an invention that-- (1) is a method, apparatus, technology, computer program product, or system, that is used solely for preparing a tax or information return or other tax filing, including one that records, transmits, transfers, or organizes data related to such filing; or (2) is a method, apparatus, technology, computer program product, or system used solely for financial management, to the extent that it is severable from any tax strategy or does not limit the use of any tax strategy by any taxpayer or tax advisor. 6 (c) ATM EXEMPTION FOR VENUE PURPOSES.--In an action for infringement under Section 281 of title 35, United States Code, of a covered business method patent, an automated teller machine shall not be deemed to be a regular and established place of business for purposes of section 1400(b) of title 28, United States Code. 30
Finally, Senator Durban is just one Senator. The legislative history is filled with comments and letters from a variety of Senators and parties interested in the patent process. At a high level, the legislative history explains that the 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. Transitional Program for CBM Patents Definitions, 77 Fed. Reg. at 48735 (citing 157 Cong. Rec. S5432 (daily ed. Sept. 8, 2011) (statement of Sen. Schumer)). The legislative history indicates that financial product or service should be interpreted broadly. Id. In conclusion, the claims of the 132 patent are not directed to a technological invention. The claims neither recite a technological feature that is novel and unobvious, nor do they solve a technical problem using a technical solution. Accordingly, the 132 patent is a CBM patent eligible for review under 37 C.F.R. 42.301(b) as already decided by this Board in TD Ameritrade. V. Identification of Challenge Under 37 C.F.R. 42.304(b) In order for covered business method patent review to be instituted, the Board must determine whether the information presented in the petition... demonstrate[s] that it is more likely than not that at least (1) of the claims challenged in the petition is unpatentable. 35 U.S.C. 324(a). As detailed below, 31
it is more likely than not that at least one claim of the 132 patent is unpatentable. In fact, CQG will demonstrate that it is more likely than not that all fifty-six claims of the 132 patent are unpatentable. A. Specific Statutory Grounds of Challenge CQG requests that each of claims 1 56 of the 132 patent be canceled under 35 U.S.C. 321 and AIA 1 on the following statutory grounds: Ground 1: Claims 1 56 are unpatentable under 35 U.S.C. 101; and Ground 2: Claims 1 56 are unpatentable under 35 U.S.C. 112, first paragraph, for lacking sufficient written description of a price column where some prices move. B. A Person of Ordinary Skill in the Art A person of ordinary skill in the art ( PHOSITA ) would have (1) a bachelor s degree in computer science, computer engineering, or electrical engineering or equivalent experience, (2) two years of experience programming GUIs, and (3) general knowledge of trading and electronic trading. C. Claim Construction Except for those terms discussed below, the claim terms of the 132 patent are given their ordinary and customary meanings under the broadest reasonable 32
interpretation, as understood by PHOSITA and consistent with the disclosure. 37 C.F.R. 42.300(b). common static price axis The broadest reasonable interpretation of the term common static price axis is a reference line or column of price levels that is common to the bid and ask display regions where the price levels do not change positions unless a re-centering command is received ( Static Limitation ). The re-centering command can be manual or automatic. Trading Tech. Int l, Inc. v. espeed, Inc., 595 F.3d 1340, 1352 55 (Fed. Cir. 2010). static display of prices The broadest reasonable interpretation of the term static display of prices is a display of prices comprising price levels that do not change positions unless a manual re-centering command is received. espeed, Inc., 595 F.3d at 1353. Static Limitation Permanency Requirement The Static Limitation requires a permanent state of lack of movement: The price axis never changes positions unless by manual re-centering or re-positioning. espeed, 595 F.3d at 1353. Static Limitation No Movement Requirement Any movement (e.g., automatic re-centering) negates the Static Limitation: 33
Automatic re-centering is not an additional feature, but rather negates a claimed requirement that the price level remains static and does not move. espeed, 595 F.3d at 1354. Static limitation All Prices Requirement The Static Limitation requires all prices in the orientation of prices displayed on a user s screen to be static. The relevant orientation is a vertical price column: The Federal Circuit consistently referred to the Static Limitation as a price column. espeed, 595 F.3d at 1340, 1353 55. But TT has consistently argued that the construction should include columns in which some prices in a price column may be static rather than all prices in a price column being static. (Memo. Op. and Order, Ex. 1019, p. 5.) While CQG does not agree with the some claim construction and does not believe it is reasonable, for the purposes of this Petition, it is the broadest reasonable construction. VI. Detailed Explanation of Reasons That Claims 1-56 of the 132 Patent Are Unpatentable A. Ground 1: Claims 1 56 Are Unpatentable Under 35 U.S.C. 101 In Mayo Collaborative Servs. v. Prometheus Labs., Inc., 132 S. Ct. 1289, 1299 (2012), the Supreme Court set forth a framework for distinguishing patents that claim... abstract ideas from those that claim patent-eligible applications of those concepts. Alice Corp. Pty. Ltd. v. CLS Bank Int l, 134 S. Ct. 2347, 2355 34
(2014). The first step is to determine whether the claims at issue are directed to abstract idea. Id. If the claims are directed to an abstract idea, the second step is to determine whether the claim recites additional language sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the ineligible concept itself. Id.; see Mayo, 132 S. Ct. at 1294 ( [T]o transform an unpatentable law of nature into a patent-eligible application of such a law, one must do more than simply state the law of nature while adding the words apply it. ). Where claims recite an abstract idea or mental process and merely add steps or components that are routine and conventional to those in the field, the claims are not patentable. Alice, at 2359. Thus, it is insufficient to limit the mental process to a particular technological environment, to add insignificant post[-] solution activity, Bilski v. Kappos, 130 S. Ct. 3218, 3230 (2010), or to add wellunderstood, routine, conventional features, Mayo, 132 S. Ct. at 1298 ( Purely conventional or obvious [pre]-solution activity is normally not sufficient to transform an unpatentable law of nature into a patent-eligible application of such a law. (alteration in original)). Instead, a claim involving an unpatentable mental process must contain other elements or a combination of elements, sometimes referred to as the 35
inventive concept, sufficient to prevent patenting the underlying mental process. Mayo, 132 S. Ct. at 1294. 1. New PTO Guidelines The PTO issued new interim guidelines for determining patent eligibility in December 2014. Interim Guidance on Patent Subject Matter Eligibility, 79 Fed. Reg. 74619 (Dec. 16, 2014) ( Guidelines ). The Guidelines describe the facts of the decisions that have issued by the Federal Circuit since the Alice decision. a. Ultramercial, LLC v. Hulu, LLC, Case No. 2010-1544 2014 U.S. App. LEXIS 21633, 112 U.S.P.Q.2D 1750 (Fed. Cir. 2014) Of special interest is the Utramercial decision regarding patent 7,346,545. See Guidelines, 79 Fed. Reg. at 74631 632. The Federal Circuit previously reviewed the Ultramercial patent twice and each time it was allowed to stand. Ultramercial, 2014 U.S. App. LEXIS 21633, at *1-6. After Alice, the Supreme Court sent the case back to the Federal Circuit with instructions to apply the Alice decision. Not surprisingly, the Federal Circuit found the patent to be invalid under 35 U.S.C. 101. The Utramercial patent called for offering users a chance to view content for free if the user was willing to view a sponsor message. Id. The 132 patent similarly describes displaying messages to a user. Using the Alice framework, the court first determined whether the claims at issue were directed to a patent-ineligible concept. The Federal Circuit found that 36
the ordered combination of the eleven steps recited an abstraction an idea, having no particular concrete or tangible form noting that the majority of limitations described only the abstract idea of showing an advertisement before delivering content. Guidelines, 79 Fed. Reg. at 74632. The Federal Circuit then turned to the next step of the analysis to determine whether the claims did significantly more than simply describe the abstract method. The court explained that consulting and updating an activity log represent insignificant data-gathering steps, restricting public access represents only insignificant [pre]-solution activity, and narrowing the idea to the Internet is an attempt to limit the use of the abstract idea to a particular technological environment. Id. Viewed both individually and as an ordered combination, the claimed steps were found insufficient to supply an inventive concept because the steps are conventional and specified at a high level of generality. The Federal Circuit concluded that the claim limitations do not transform the abstract idea that they recite into patent-eligible subject matter because the claims simply instruct the practitioner to implement the abstract idea with routine, conventional activity. All of the claims were found ineligible. Id. 37
b. DDR Holdings, LLC v. Hotels.com, L.P., Case No. 2013-1505, 2014 U.S. App. LEXIS 22902 In DDR Holdings, a three judge Federal Circuit case, two judges found the claim at issue patent eligible under the Alice framework while a third dissented. Guidelines, 79 Fed. Reg. at 74632. First, the court noted that, while in some instances abstract ideas are plainly identifiable and divisible from generic computer limitations recited by the remainder of a claim, in this case, identifying the precise nature of the abstract idea is not as straightforward. Id. The Federal Circuit considered several proposed characterizations of the abstract idea, including making two web pages look the same, syndicated commerce on the computer using the Internet and making two e-commerce web pages look alike by using licensed trademarks, logos, color schemes and layouts, and that an online merchant s sales can be increased if two web pages have the same look and feel. The court did not clearly indicate whether the claim was directed to one or more of these proposed abstract ideas, but stated that under any of these characterizations of the abstract idea, the 399 patent s claims satisfy Mayo/Alice step two. Id. The court then explained its analysis of the second Mayo/Alice step, where it determined that the claim amounted to an inventive concept and thus was patent eligible. In particular, the claim addresses the problem of retaining website visitors 38
from being diverted from a host s website to an advertiser s website, for which the claimed solution is necessarily rooted in computer technology in order to overcome a problem specifically arising in the realm of computer networks. The claim includes additional elements including 1) stor[ing] visually perceptible elements corresponding to numerous host websites in a database, with each of the host websites displaying at least one link associated with a product or service of a third-party merchant, 2) on activation of this link by a website visitor, automatically identif[ying] the host, and 3) instruct[ing] an Internet web server of an outsource provider to construct and serve to the visitor a new, hybrid web page that merges content associated with the products of the third-party merchant with the stored visually perceptible elements from the identified host website. Id. The court held that, unlike in Ultramercial, the claim does not generically recite use the Internet to perform a business practice, but instead recites a specific way to automate the creation of a composite web page by an outsource provider that incorporates elements from multiple sources in order to solve a problem faced by websites on the Internet. Therefore, the court held that the claim is patent eligible. Id. 39
2. Indicators of Abstract Ideas Courts have looked to a number of factors to determine whether a claim covers merely an unpatentable abstract idea or a patentable application of that idea. Courts have considered whether a claim involving an idea or mental process is tied to a particular machine or apparatus. Bilski, 130 S. Ct. at 3225 27; see, e.g., Diamond v. Diehr, 450 U.S. 175, 187 (1981) (process claim for curing rubber held patentable where the claimed process required using a specially programmed computer to signal a rubber molding press to open at the right time). Courts have also considered whether a claimed process transforms a particular article into a different state or thing. Bilski, 130 S. Ct. at 3225 27; see, e.g., Diehr, 450 U.S. at 184 (claimed process for curing rubber transformed the rubber to a different state or thing and thus was patentable under Section 101). It is well settled that a patentee cannot circumvent the prohibition against patenting abstract ideas and mental processes merely by using generic computing components to perform an otherwise unpatentable mental process. Bancorp Servs., L.L.C. v. Sun Life Assur. Co. of Canada (U.S.), 687 F.3d 1266, 1278 (Fed. Cir. 2012). Merely [u]sing a computer to accelerate an ineligible mental process does not make that process patent-eligible. Id. at 1279; see also CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d 1366, 1375 (Fed. Cir. 2011) ( [S]imply reciting 40
the use of a computer to execute an algorithm that can be performed entirely in the human mind is not sufficient to satisfy 101.); Dealertrack, Inc. v. Huber, 674 F.3d. 1315, 1333 (Fed. Cir. 2012) ( Simply adding a computer aided limitation to a claim covering an abstract concept, without more, is insufficient to render the claim patent eligible. ); Fort Props., Inc. v. Am. Master Lease LLC, 671 F.3d 1317, 1323 24 (Fed. Cir. 2012) ( AML simply added a computer limitation to claims covering an abstract concept that is, the computer limitation is simply insignificant post-solution activity. ). As explained in CyberSource, the basic character of a process claim drawn to an abstract idea is not changed by claiming only its performance by computers, or by claiming the process embodied in program instructions on a computer readable medium. 654 F.3d at 1375. Consistent with this authority, the Board has held that a patent claim directed to an abstract idea or mental process must recite more than generic general purpose computer hardware (processor, memory, storage) to survive a 101 challenge. See SAP America v. Versata Dev. Gr., Inc., Case CBM2012-00001, Final Written Decision (Paper No. 70), at p. 30 (Jun. 11, 2013) (finding that the claim was directed to an abstract idea because it required only routine computer hardware and programming ). Likewise, appending generic computer functionality to the performance of an otherwise abstract concept does not 41
meaningfully limit the claim scope for purposes of patent eligibility. Meridianlink, Inc. v. DH Holdings, LLC, No. CBM2013-00008, Decision to Institute (Paper No. 20), at p. 15 n.2 (P.T.A.B. Jun. 24, 2013) (citing CLS Bank Int l v. Alice Corp. Pty. Ltd., 717 F.3d 1269 (Fed. Cir. 2013)). 3. Economic Practices Are Abstract Ideas The Supreme Court in Alice further defined what is patentable subject matter under 35 U.S.C. 101. The Court held that a claim that recites an abstract idea is not patent eligible unless the claim contains an inventive concept sufficient to transform the claimed abstract idea into a patent-eligible application. Alice, 134 S. Ct. at 2357 (internal quotations marks omitted). The Court also confirmed that abstract ideas include fundamental economic practices. Id. at 2356 357. The patents-at-issue in Alice related to intermediated settlement. More specifically, the claims recited a computerized scheme for mitigating settlement risk and were designed to facilitate the exchange of financial obligations between two parties by using a computer system as a third party intermediary. Id. at 2352 (internal quotation marks omitted). Using the two-step Mayo framework, the Court first determined that the concept of intermediated settlement is a fundamental economic practice long 42
prevalent in our system of commerce, and as such is an abstract idea. Id. at 2356. The Court then turned to the second step in the analysis. Under the second step, the Court evaluated the claims individually and as an ordered combination. The Court determined that the claims did not contain an inventive step, because the claims did no more than simply instruct the practitioner to implement the abstract idea of intermediated settlement on a generic computer. Id. at 2359. Evaluating the claim elements separately, the Court found that the function performed by the computer at each step creating and maintaining shadow accounts, obtaining data, adjusting account balances, and issuing automated instructions is purely conventional. Id. When viewed as a whole, the Court concluded that the claims simply recite the concept of intermediated settlement as performed by a generic computer.... [ and do not] purport to improve the functioning of the computer itself.... [nor] effect an improvement in any other technology or technical field. Id. (internal citations and quotation marks omitted.) 4. The 132 Patent Is Not Patentable Under 35 U.S.C. 101 Because All of Its Claims Are Directed to an Abstract Idea The 132 patent is not patentable under 35 U.S.C. 101 because all of its claims are directed toward an abstract idea. As discussed below, the subject matter of claims 1 56 of the 132 patent, which relate to and facilitate the placing of a 43
trade order for a commodity on an electronic exchange, based on observed market information, as well as updating the market information, are abstract ideas that are not entitled to patent protection. TD Ameritrade filed a petition for covered business method review in May 2014 on the basis that the claims of the 132 patent are, inter alia, directed to unpatentable subject matter under 35 U.S.C. 101. See TD Ameritrade Holding Corp., Case CBM2014-00135, Petition (Paper No. 4), at p. 14 (P.T.A.B. May 20, 2014) (Ex. 1019.) The Board agreed and instituted CBM review, stating that Petitioner has demonstrated that claims 1 56 are more likely than not patent eligible under 35 U.S.C. 101. (Ex. 1016, p. 15.) Although the Board has already determined that covered business method patent review of the 132 patent is warranted, (Id.), CQG will provide analysis to further illustrate that the claims in the 132 patent are abstract and do not require significantly more. The claims of the 132 patent relate to placing an order based on observed market information, as well as updating the market information. Specifically, independent claim 1 of the 132 patent, upon which claims 2 7, 20 29, 50, and 53 56 depend either directly or indirectly, relates to: A method of placing a trade order for a commodity being traded on an electronic exchange having an inside market with a highest bid price 44
and a lowest ask price, using a graphical user interface and a user input device. (Ex. 1001, independent claim 1, preamble.) Independent claim 8, upon which claims 9 12, 30 39, and 51 depend either directly or indirectly, relates to: A computer readable medium having program code recorded thereon, for execution on a computer having a graphical user interface and a user input device, to place a trade order for a commodity on an electronic exchange having an inside market with a highest bid price and lowest ask price. (Id., independent claim 8, preamble.) Finally, independent claim 14, upon which claims 15 19, 40 49, and 52 depend either directly or indirectly, relates to: A client system for placing a trade order for a commodity on an electronic exchange having an inside market with a highest bid price and lowest ask price. (Id., independent claim 14, preamble.) a. The Claims of the 132 Patent Are Directed to an Abstract Idea Turning to the first step of the Mayo/Alice framework, the subject matter of the claims is evaluated to determine if the claims are directed to an abstract idea. The Supreme Court in Alice confirmed that fundamental economic principles practices are abstract ideas. As mentioned above, claims 1 56 of the 132 patent are directed to the abstract concept of placing an order based on observed market 45
information, as well as updating the market information. Like intermediate settlement, the idea of placing an order based on observed market information, as well as updating the market information, is a fundamental economic practice long prevalent in our system of commerce. See Alice, at 2356; (See Ex. 1017, 6 12.) Therefore, claims 1 56 of the 132 patent are directed to an abstract idea. The introduction of a graphical user interface ( GUI ) into the claims of the 132 patent does not alter the analysis. The claimed GUI is simply a mechanism for implementing the abstract idea of placing an order based on observed market information, as well as updating the market information: The exchange sends the price, order and fill information to each trader on the exchange. The present invention processes this information and maps it through simple algorithms and mapping tables to positions in a theoretical grid program or any other comparable mapping technique for mapping data to a screen. The physical mapping of such information to a screen grid can be done by any technique known to those skilled in the art. (Ex. 1001, 4:61 5:1.) In addition, the claims do not improve the function of the computer itself or effect an improvement in any other technology or technical field. See Alice, at 2359; see also The Cal. Institute of Tech. v. Hughes Comm., No. 2-13-cv-07245, 2014 U.S. Dist. LEXIS 156763, at *24 (C.D. Cal. Nov. 3, 2014) (under Alice., 46
software may be patentable if it improves the functioning of a computer). Rather, the 132 patent discloses that its system can be implemented on any existing or future terminal or device (Ex. 1001, 4:4 9), which are known to include displays, and discloses that the input device can be a mouse (id., 4:9 14), which is a known input device. See Alice, at 2358 ( [W]holly generic computer implementation is not generally the sort of additional featur[e] that provides any practical assurance that the process is more than a drafting effort designed to monopolize the [abstract idea] itself. (internal quotation marks omitted)). Further, the 132 patent depicts a prior art GUI tool used for trading in Figure 2. (Ex. 1001, 5:11 17.) TT has described this prior art GUI tool as conventional and stated that [s]ome of these types of tools permitted single action order entry. TD Ameritrade, Patent Owner s Preliminary Response (Paper No. 17), at pp. 6 7 (P.T.A.B. Sept. 3, 2014) (Ex. 1020.) From these statements, the Board determined that the use of software to create GUI s for displaying market information and entering orders via a single action was known and conventional. (Ex. 1016, pp. 11 12.) As discussed above, the claims merely apply the abstract idea of placing an order based on observed market information, as well as updating the market information on a generic computer. There is nothing in the 132 patent directed to 47
a specific technical implementation. Consequently, claims 1 56 of the 132 patent are abstract. b. The Claims as an Ordered Combination Do Not Provide Something More Turning to the next step of the Alice framework, the elements of the claims are evaluated separately and as an ordered combination to see if the steps together create something more than the abstract idea. Taking the claim elements separately, the function performed by the computer at each step setting a preset parameter, displaying market depth of a commodity, displaying an order entry region having a plurality of areas, and selecting a particular area in the order entry region through a user input device is purely conventional. (Ex. 1001, independent claims 1, 8, and 14). Viewed as a whole, the claims of the 132 patent simply recite the abstract concept of placing orders on an electronic exchange based on observed market information, as well as updating the market information, as performed by a generic computer. The elements fail to add significantly more to the abstract idea. The claims recite the placing of a trade order using a GUI with data formatted in a well-known manner, where the GUI is used to send a trade to an electronic exchange. More specifically, the claims call for setting a preset parameter for the trade order. This claim element is logical and conventional as 48
the entire point of electronic trading is to enter orders and adds nothing that could be considered something more. The claim recites selecting a particular area with an input device to select a trade, which is a fundamental abstract idea that cannot be preempted without monopolizing the entire field of electronic trading. The claims call for displaying market depth of the commodity. As mentioned in the background of the 132 patent, electronic trading systems have been in existence at the time of the patent and this claim element is conventional and adds nothing inventive. Further, aligning the market depth of a commodity next to a static display of prices is nothing more than populating a display with data. Those mere data-gathering steps likewise cannot make an otherwise nonstatutory claim statutory. CyberSource, 654 F.3d at 1370 (internal bracketing and quotation marks removed) (in part quoting In re Grams, 888 F.2d 835, 840 (Fed. Cir. 1989)). These two steps of claims, namely setting a preset parameter and displaying the market depth of a commodity, are nothing more than data gathering to populate the GUI with data. Data gathering is insufficient to transform an unpatentable principle into a patentable process. Parker v. Flook, 437 U.S. 584, 590 (1978). Displaying an order entry region aligned with the static display of prices. Again, the point of electronic trading systems is enter orders so this adds nothing 49
inventive. This step of displaying a region at a particular location that can receive a trading command is a necessary component to implement the abstract idea. Here, the application of making a trade requires that data be presented to the trader. Finally, the claims recite selecting a particular area in the order entry region. This claim element is logical and conventional as the entire point of electronic trading is to enter orders and adds nothing that could be considered something more. The selection of a particular area with an input device to prepare and send a trade is a fundamental abstract idea that cannot be preempted without monopolizing the entire field of electronic trading. As described above, the abstract idea is merely recited in the independent claims along with well-known and insignificant extra-solution activity. Importantly, this abstract idea is central to the trading of commodities all over the world. Patentee cannot be allowed to preempt this fundamental economic tool. Moreover, abstract ideas cannot be circumvented by attempting to limit the use to a particular technological environment. Bilski, supra, at 3230 (quoting Diehr, 450 U. S., at 191 192). Thus, limiting the claims to the field of trading commodities is insufficient to save them. In addition, the fact that independent claim 8 is directed to a computer readable medium and recites program code recorded on the medium for execution 50
by a computer that cause the machine (i.e., computer) to perform the steps of a method, does not make claim 8 patent eligible. Similarly, the fact that independent claim 14 is directed to a client system and recites various components such as a parameter setting component and a trade order sending component, does not make claim 14 patent eligible. The Court explicitly stated that the mere recitation of a generic computer cannot transform a patent in-eligible abstract idea into a patent eligible invention. Alice, at 2358. Thus, even if the claims are directed to a computer readable medium or a computer system and recite specific hardware configured to perform specialized functions, the claims are not patentable if the hardware is purely functional and generic. Id., at 2360 ( [N]one of the hardware recited by the system claims offers a meaningful limitation beyond generally linking the use of the [method] to a particular technological environment, that is, implementation via computers. (internal quotation marks omitted)). Here, the recitation of program code and a computer is purely generic, and does not transform the claimed abstract idea of placing an order based on observed market information, as well as updating the market information, into a patent-eligible application. Like the claims of the patents-at-issue in Alice, the claims of the 132 patent do nothing more than instruct a practitioner to implement an abstract idea on a 51
generic computer which is exactly the determination the Board made when granting CBM review of the 132 patent in the TD Ameritrade case. (Ex. 1016, p. 15 ( claim 1 does no more than simply instruct the practioner4 to implement the abstract idea on a GUI ).) Unlike the 132 patent, the patent-at-issue in the DDR decision discussed above described the significant technology needed to implement the claimed system. The 132 patent basically states apply these steps which have been occurring for generations using a generic computer. While TT will try to read much more into the DDR decision, the facts and application are distinguishable. Accordingly, the claims of the 132 patent are not eligible for patent protection under 35 U.S.C. 101. c. Claims Fail the Machine-or-Transformation Test Although not exhaustive, the machine-or-transformation test remains a useful and important clue... for determining whether some claimed inventions are processes under 101. Bilski, 130 S. Ct. at 3227. This test requires that either (1) the claim restrict the process to a particular machine or (2) the process effect some transformation and reduction of an article to a different state or thing. Gottschalk v. Benson, 409 U.S. 63, 70, 93 S. Ct. 253 (1972). In the 132 patent, the claims are not restricted to a particular machine. To the contrary, the patent calls for any general purpose computer. Even the 52
specification of the 132 patent acknowledges that the alleged invention requires only a generic computer or [an] electronic terminal... able to communicate directly or indirectly... with the exchange. (Ex. 1001, 3:64 3:67.) Further, the process does not transform an article into a different state or thing. The claims are traditional method claims that use a GUI for trading. Unlike the claims in Diamond v. Diehr, there is no transformation of an article. (1) The 132 Patent Claims Are Not Tied to a Particular Machine [T]o impart patent-eligibility to an otherwise unpatentable process under the theory that the process is linked to a machine, the use of the machine must impose meaningful limits on the claim s scope. CyberSource, 654 F.3d at 1375 (internal quotation marks omitted). [I]ncidental use of a computer to perform [a] mental process or merely claiming a software implementation of a purely mental process that could otherwise be performed without the use of a computer do[] not satisfy the machine prong of the machine-or-transformation test. Id. The use of a general purpose computer only for its most basic function does not satisfy the machine prong, because it does not impose meaningful limits on the scope of those claims. Bancorp, 687 F.3d at 1278; see also SAP, supra, (Paper No. 70), at p. 30 ( [A]s with the shift register in Benson, the recitation of generic general purpose computer hardware (processor, memory, storage) in the challenged claims 53
represents routine, well-understood conventional hardware that fails to narrow the claims relative to the abstract idea. ). As in Bancorp, the 132 patent claims use a computer only for its most basic function executing instructions and thus do[] not impose meaningful limits on the scope of those claims. Bancorp, 687 F.3d at 1278. Similarly, the use of a user interface and other generic computer components (e.g., user input device, computer readable medium, etc.) in the 132 patent does not satisfy the machine prong. Courts have repeatedly held that merely using a data-gathering device (such as a user interface) for a data-gathering step does not satisfy the machine prong. See, e.g., CyberSource, 654 F.3d at 1370 ( We have held that mere [datagathering] step[s] cannot make an otherwise nonstatutory claim statutory. ); Content Extraction & Transmission LLC v. Wells Fargo Bank N.A., No. 12-2501, 2013 U.S. Dist. LEXIS 107184, at *32 (D.N.J. July 31, 2013) ( [T]he use of the scanner is pre-solution activity that does not provide any meaningful limitation on the extent of the claims contained in the Patents-in-Suit. ); CyberFone Sys., LLC v. Cellco P ship, 885 F. Supp. 2d 710, 718 (D. Del. Aug. 16, 2012) ( [T]he telephone is not an integral part of the claim; it simply functions as a means for collecting data whereas the real focus of the claim is the sorting and storing. As the 54
CyberSource Court explained, mere [data-gathering] step[s] cannot make an otherwise nonstatutory claim statutory. ). (2) The 132 Patent Claims Do Not Transform a Particular Article Into a Different State or Thing None of the 132 patent claims transforms a particular article into a different state or thing. The claims are directed to placing an order based on observed market information, as well as updating the market information. Courts have repeatedly held that mere calculations and other data manipulations within a computer do not constitute the required transformation. See, e.g., CyberSource, 654 F.3d at 1370 ( The mere collection and organization of data is insufficient to meet the transformation prong of the test[.] ); Content Extraction2013 U.S. Dist. LEXIS 107184, at *37 ( [O]rganizing data into subsets does not render a transformation. ); id. ( [C]omputer memory is not transformed when it receives electronic data. ); CyberFone, 885 F. Supp. 2d at 717 ( [N]o transformation can be said to have occurred in claim 1 via the second step where the data is organized into subsets. ); id. ( The storage device is not transformed into a different state or thing by the mere receipt of additional electronic data. ); and Ex parte William Earl Russell, II, Appeal No. 2009-011532, Decision on Appeal, at p. 5 (B.P.A.I. Feb. 24, 2011) ( There is no legal principle that holds transforming data that 55
represents particular physical objects is a transformation of something to a different state or thing. ). Further, claim 1 s placing an order limitation does not satisfy the transformation prong. The claim limitation amounts to no more than insignificant post-solution activity. See Mayo, 132 S. Ct. at 1294 (One must do more than simply state the mental process while adding the words apply it. ) d. Dependent Claims The dependent claims also do not add something more as required by Mayo/Alice. As noted by the Board in TD Ameritrade: none of the dependent claims 2 7, 9 13, and 14 56 appears to recite additional elements or combinations of elements that add significantly more to the abstract idea so as to claim patenteligible subject matter. (Ex. 1016, p. 15.) More specifically, Claims 2 7, 50 and 56 discuss the placing of a bid and ask in order entry regions and cancelation thereof, which is to be expected in an electronic trading system. Claims 20 23, 25 29 merely add insignificant details regarding the orientation and elements of the GUI. Claims 53 55 merely discuss that the static display of prices does not move. Regarding independent claims 8 and 14, dependent claims 9 13 and 15 19, respectively, are similar to dependent claims 2 6. Dependent claims 30 39 and 56
40 49, respectively, are similar to claims 20-29. And dependent claims 51 and 52, respectively, are similar to claim 50. Again, such dependent claims do not add something more that would make the claims less abstract. a. Other Related TT Patents Have Been Determined to Be Abstract by The Board Further, the Board has already found related TT patents are more likely than not abstract in order to institute CBM review against these patents. In TD Ameritrade Holding Corp. v. Trading Tech. Int l, Inc., Case CBM2014-00131, Decision to Institute (Paper No. 19), at p. 15 (P.T.A.B. Dec. 2, 2014) (Ex. 1022), addressing U.S. Patent No. 7,533,056 entitled, User Interface for Electronic Trading System, the Board stated: Petitioner has shown that it is more likely than not that claim 1 is directed to the abstract idea of graphing (or displaying) bids and offers to assist a trader in making an order. In TD Ameritrade Holding Corp. v. Trading Tech. Int l, Inc., Case CBM2014-00133, Decision to Institute (Paper No. 19), at p. 14 (P.T.A.B. Dec. 2, 2014) (Ex. 1023), addressing U.S. Patent No. 7,676,411, entitled Click Based Trading with Intuitive Grid Display of Market Depth, the Board stated: On this record, we are persuaded by Petitioner that claim 1 is directed to the abstract idea of placing an order based on observed market information, as well as updating the market information. 57
Finally, in TD Ameritrade Holding Corp. v. Trading Tech. Int l, Inc., Case CBM2014-00137, Decision to Institute (Paper No. 19), at p. 14 (P.T.A.B. Dec. 2, 2014) (Ex. 1024.), addressing U.S. Patent No. 7,685,055, entitled System and Method for Automatically Repositioning of Market Information in a Graphical User Interface, the Board stated: On this record, we are persuaded by Petitioner that claim 1 is directed to the abstract idea of repositioning market information on a graphical user interface. B. Ground 2: Claims 1 56 Are Unpatentable Under 35 U.S.C. 112, First Paragraph, for Lacking Sufficient Written Description of a Price column Where Only Some Prices Move, Not All Although CQG believes that the Static Limitation should be construed to cover only price columns where all prices are static, TT has and continues to assert that the full scope of the Static Limitation includes both price columns where all displayed prices are static and price columns where only some prices are static. (Ex. 1019, p. 5.) Yet, the 132 patent only describes a price column where all displayed prices are static. (See Ex. 1028, 23 40.) As required by the CBM patent review rules, the patent must be given its broadest reasonable interpretation. Accordingly, TT s broadly asserted claims lack written description support and are invalid under 35 U.S.C. 112, 1. 58
To satisfy the written description requirement, a patent specification must describe the claimed invention in sufficient detail that PHOSITA can reasonably conclude that the inventor had possession of the claimed invention. See, e.g., Moba, B.V. v. Diamond Automation, Inc., 325 F.3d 1306, 1319 (Fed. Cir. 2003); Vas-Cath, Inc. v. Mahurkar, 935 F.2d 1555, 1563 (Fed. Cir. 1991). But a showing of possession alone does not cure the lack of a written description. Enzo Biochem, Inc. v. Gen-Probe, Inc., 323 F.3d 956, 969 70 (Fed. Cir. 2002). An applicant shows possession of the claimed invention by describing the claimed invention with all of its limitations using such descriptive means as words, structures, figures, diagrams, and formulas that fully set forth the claimed invention. Lockwood v. Am. Airlines, Inc., 107 F.3d 1565, 1572 (Fed. Cir. 1997). Possession may be shown in a variety of ways including description of an actual reduction to practice, or by showing that the invention was ready for patenting such as by the disclosure of drawings or structural chemical formulas that show that the invention was complete, or by describing distinguishing identifying characteristics sufficient to show that the applicant was in possession of the claimed invention. See, e.g., Pfaff v. Wells Elecs., Inc., 119 S. Ct. 304, 312 (1998); Amgen, Inc. v. Chugai Pharm., 927 F.2d 1200, 1206 (Fed. Cir. 1991) (one must define a compound by whatever characteristics sufficiently distinguish it ). 59
Compliance with the written description requirement is essentially a fact-based inquiry that will necessarily vary depending on the nature of the invention claimed. Enzo Biochem, 323 F.3d at 963. The inquiry follows three steps: 1. For Each Claim, Determine What the Claim as a Whole Covers; 2. Review the Entire Application to Understand How Applicant Provides Support for the Claimed Invention Including Each Element and/or Step; and 3. Determine Whether There is Sufficient Written Description to Inform a Skilled Artisan That Applicant was in Possession of the Claimed Invention as a Whole at the Time the Application Was Filed. Id. 1. Claim Coverage Although CQG disagrees that the claims cover a price column where only some displayed prices are static, TT has repeatedly raised this interpretation to the Northern District of Illinois. (Ex. 1019, p. 5.) Taking the broadest reasonable interpretation for the purposes of this Petition only, some, but not necessarily all, displayed prices must be static. The Examiner, who examined the application that issued as the 132 patent and provided a statement of reasons for allowance, confirmed that the invention in the 132 was limited to a price column where all prices are static. (Ex. 1002, p. 871.) The Examiner commented that unlike the prior art, the static display of 60
prices is just that static, and does not move in response to a change in the inside market. (Id.) Noticeably absent from the prosecution histories is any explanation of a price column where only some prices are static. 2. Written Description The specification of the 132 patent refers to the Static Limitation as a price column. (See Ex. 1028, 23.) The plain and ordinary meaning of column is a columnlike object, mass, or formation, a vertical arrangement on a page of horizontal lines..., and a vertical row or list. (Id., 34.) Just like a Roman or Greek column extends the entire distance between its base (i.e., the pedestal) and its top (i.e., the capital), a price column extends the entire distance from bottom to top and includes all prices displayed along the vertical arrangement. Therefore, the specification s consistent use of the term column strongly suggests to a PHOSITA that the Static Limitation includes all prices displayed in the vertical formation or arrangement. (Id., 34.) The specification comports with the dictionary definition of column. In particular, the specification describes the operation of the Mercury display using two screen shots of the display at two different points in time, as depicted in Figures 3 and 4 below and annotated to show the price column in red and bid and ask columns in blue. (Id., 31 33, 35 40.) 61
Figure 3 displays a market for a commodity at a first point in time at which the inside market comprises a best (i.e., highest) bid of 18 units at a price of 89 and a best (i.e., lowest) ask of 20 units at a price of 90. (Id., 32 33.) Figure 4 displays the same market at a later time where the inside market has shifted upward such that the best bid is now for 43 units at a price of 92 and the best ask is for 63 units at a price of 93. (Id., 39.) The specification explains that it can be seen that the price column remained static. (Id.) Indeed, the price column in Figure 3 has the same range of prices located in the same positions as the price 62