Docket No. 2016-1353 (CMB2014-00100, CBM2015-00009, CBM2015-00027)
LOURIE (D), PLAGER, TARANTO
February 21, 2017
Update: Petition for rehearing en banc denied (June 6, 2017)
Brief Summary: Board characterization of ‘191 patent as a CBM patent reversed and vacated because the statutory definition of a CBM patent requires that the patent have a claim that contains, however phrased, a financial activity element”, not just one that is “‘incidental to’ or ‘complementary to’ financial activity.”
Summary: Secure Axcess appealed PTAB Final Written Decision that US 7,631,191 was a CBM patent and that all of the claims would have been obvious. The FC panel concluded the ‘191 patent was not a CBM under its Unwired Planet (FC 2016) decision. The Board concluded “[t]he ‘191 patent relates to authenticating a web page and claims a particular manner of doing so” and “is directed to solving problems related to providing a web site to customers of financial institutions”, an “ancillary activity related to a financial product or service of Web site management and functionality”, thereby falling within the definition of a CBM patent. The FC panel explained that the issue in this appeal was “whether the Board properly understood the scope of the statutory definition” of a CBM, which “Congress did not leave…to chance.” Rather, it defined a CBM patent as “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” (AIA § 18(d)(1)), thereby “mak[ing] what a patent ‘claims’ determinative of the threshold requirement for coming within the defined class.” As to the first clause (“a patent that claims”), the FC panel concluded, “[i]t is the claims, in the traditional patent law sense, properly understood in light of the written description [Philips, FC 2005], that identifies a CBM patent.” As to the second clause (“a financial product or service”), the FC panel found that the phrase “and are incidental to a financial activity…is not a part of the statutory definition of” a CBM patent as the Board concluded (the FC panel citing Unwired Planet, FC 2016 and Blue Calypso, FC 2016). Thus, “the statutory definition of a CBM patent requires that the patent have a claim that contains, however phrased, a financial activity element”, not just one that is “‘incidental to’ or ‘complementary to’ financial activity.” “Such phrases can have unintended consequences” since “most, if not virtually all, inventors of methods or products claimed in a patent have some expectation that complementary financial activity will result”. And “just because an invention could be used by various institutions that include a financial institution” (“[l]ike the lightbulb example in Unwired Planet”), “does not mean a patent on the invention qualifies under the proper definition of a CBM patent.” The Board’s decision that the ‘191 patent is a CBM patent was therefore reversed and vacated. The FC panel did not reach the claim constructions or obviousness determination. Judge Lourie dissented because, e.g., “[t]he claims of the ‘191 patent are surely claims to a method or corresponding apparatus…used in the practice…of a financial product or service” under AIA § 18(d)(1).