UNITED STATES PATENT AND TRADEMARK OFFICE BEFORE THE PATENT TRIAL AND APPEALS BOARD

Transcription

1 UNITED STATES PATENT AND TRADEMARK OFFICE BEFORE THE PATENT TRIAL AND APPEALS BOARD CARE N CARE INSURANCE COMPANY and TRIZETTO CORPORATION, Petitioners v. INTEGRATED CLAIMS SYSTEMS, LLC, Patent Owner Case No.: To Be Assigned Patent No.: 7,178,020 PETITION FOR TRANSITIONAL POST-GRANT REVIEW OF A COVERED BUSINESS METHOD PATENT UNDER SECTION 18 OF THE LEAHY-SMITH AMERICA INVENTS ACT AND 37 C.F.R Mail Stop Patent Board Patent Trial and Appeal Board United States Patent and Trademark Office P.O. Box 1450 Alexandria, VA

2 TABLE OF CONTENTS Page I. 37 C.F.R. 42.8: MANDATORY NOTICES... 1 A. 37 C.F.R. 42.8(b)(1): Real Party-In-Interest... 1 B. 37 C.F.R. 42.8(b)(2): Related Matters... 1 C. 37 C.F.R. 42.8(b)(3) and (4): Designation of Lead and Back- Up Counsel and Identification of Service Information... 2 II. 37 C.F.R : PAYMENT OF FEES... 2 III. 37 C.F.R (a): GROUNDS FOR STANDING... 3 A. The 020 Patent Is a Covered Business Method Patent B. 37 C.F.R (a): Petitioners Are Eligible to File a CBMR C. 37 C.F.R (b): Petitioners Are Not Estopped IV. 37 C.F.R (b): IDENTIFICATION OF CHALLENGE... 3 A. 37 C.F.R (b)(1): Claims for Which CBMR Is Requested... 3 B. 37 C.F.R (b)(2): Statutory Grounds on Which the Challenge Is Based... 3 C. 37 C.F.R (b)(3): Claim Construction unitary data stream digital attachment... 5 D. 37 C.F.R (b)(4): How the Claims Are Unpatentable... 5 E. 37 C.F.R (b)(5): Evidence Supporting Challenge... 5 V. PRELIMINARY STATEMENT... 6 VI. THE 020 PATENT IS A COVERED BUSINESS METHOD PATENT i

3 A. The 020 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 Claims 8, 21, and 36 Are Expressly Directed to a Method and Corresponding Apparatus for Performing Data Processing Used in the Administration of a Financial Product The 020 Patent Describes Its Claimed Invention As Being Directed to Data Processing Used in the Administration of a Financial Product ICS s Own Characterizations of the 020 Patent Confirm It Relates to a Financial Product or Service That the 020 Patent Has Been Asserted Against Insurance Companies, and ICS s Infringement Allegation, Confirm It Relates to a Financial Product or Service B. The Challenged Claims Do Not Recite a Technological Invention The Challenged Claims Do Not Recite a Technological Feature That Is Novel and Non-obvious Over the Prior Art The Challenged Claims Do Not Solve a Technical Problem Using a Technical Solution a. The Alleged Problem Is Non-Technical b. To the Extent the Challenged Claims Solve Any Alleged Problem, They Do So Only by Reciting Well-Known Prior Art Technology VII. IT IS MORE LIKELY THAN NOT THAT THE CHALLENGED CLAIMS ARE UNPATENTABLE A. Description of the Alleged Invention of the 020 Patent B. Ground 1: The Challenged Claims Are Not Patent-Eligible Under 35 U.S.C Claims That Recite Abstract Ideas Implemented Using General-Purpose Computer Components Are Not Patent- Eligible ii

4 2. Alice Step 1: The Challenged Claims Are Drawn to an Abstract Idea Alice Step 2: Nothing in the Challenged Claims Supplies an Inventive Concept a. Claim b. Claim c. Claim d. Claim e. Claim f. Claim g. Claim h. Claim i. Claim j. Claim k. Claim C. Ground 2: Challenged Claims 1, 6, 9, 15, and 20 Are Anticipated by U.S. Patent No. 5,258,855 ( Lech ), Rendering Them Unpatentable Under 35 U.S.C Overview of Lech Lech Is Prior Art and Eligible for Use in CBMR Lech Anticipates Claim Lech Anticipates Claims 6 and Lech Anticipates Claim Lech Anticipates Claim D. Ground 3: Challenged Claims 6, 8, 12, 13, 20, 21, 24 and 25 Are Obvious In View of Lech in Combination With U.S. Patent No. 5,054,096 ( Beizer ), Rendering Them Unpatentable Under 35 U.S.C Beizer Is Prior Art and Eligible for Use in CBMR One of Ordinary Skill In the Art Would Be Motivated to Combine Lech and Beizer Lech in Combination with Beizer Discloses All Elements of Claims 6 and Lech in Combination with Beizer Discloses All Elements of Claims 8 and Claims 12 and 24 Are Obvious in View of Lech iii

5 6. Lech in Combination with Beizer Discloses All Elements of Claims 12 and Lech in Combination with Beizer Discloses All Elements of Claims 13 and VIII. CONCLUSION iv

6 TABLE OF AUTHORITIES Page Cases Accenture Global Servs., GmbH v. Guidewire Software, Inc., 728 F.3d 1336 (Fed. Cir. 2013)... 30, 35 Alice Corp. Pty. Ltd. v. CLS Bank Int l, 134 S. Ct (2014)... passim Am. Express Co. v. Lunenfeld, CBM , Paper 17 (PTAB June 18, 2014)... 15, 16, 18, 19 Apple Inc. v. SightSound Techs., LLC, CBM , Paper 14 (PTAB Oct. 8, 2013)... 8 Bilski v. Kappos, 561 U.S. 593 (2010)... passim Bloomberg Inc. v. Markets-Alert PTY Ltd., CBM , Paper 18 (PTAB Mar. 29, 2013) Content Extraction and Transmission v. Wells Fargo Bank, N.A., No , et al., 2014 WL (Fed. Cir. Dec. 23, 2014)... passim Coresource, Inc. v. Quality Healthcare Intermediary, LLC, CBM , Paper 9 (PTAB July 28, 2014) Coupa Software, Inc. v. Ariba, Inc., CBM , Paper 11 (PTAB July 25, 2014)... 23, 24 CRS Advanced Techs., Inc. v. Frontline Techs., Inc., CBM , Paper 17 (PTAB Jan. 23, 2013)... 9 Cyberfone Sys., LLC v. CNN Interactive Grp., Inc., 558 F. App x 988 (Fed. Cir. 2014)... passim CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d 1366 (Fed. Cir. 2011)... passim DDR Holdings, LLC v. Hotels.com, L.P., , 2014 WL (Fed. Cir. Dec. 5, 2014) (E... 43, 44 v

7 TABLE OF AUTHORITIES (CONT D) Page Dealertrack, Inc. v. Huber, 674 F.3d 1315 (Fed. Cir. 2012)... 28, 41, 43, 50 Gillman v. StoneEagle Servs., Inc., CBM , Paper 11 (PTAB Feb. 18, 2014) In re Bilski, 545 F.3d 943 (Fed. Cir. 2008)... passim KSR Int l Co. v. Teleflex Inc., 550 U.S. 398 (2007)... 68, 69 Liberty Mut. Ins. Co. v. Progressive Cas. Ins. Co., CBM , Paper 66 (PTAB Jan. 23, 2014)... 9 Liberty Mut. Ins. Co. v. Progressive Cas. Ins. Co., CBM , Paper 15 (PTAB Feb. 12, 2013) Liberty Mut. Ins. Co. v. Progressive Cas. Ins. Co., CBM , Paper 13 at 6 (PTAB Jan. 27, 2013) Mayo Collaborative Servs. v. Prometheus Labs., Inc., 132 S. Ct (2012)... passim Parker v. Flook, 437 U.S. 584 (1978)... 45, 46, 51 PNC Fin. Servs. Grp., Inc. v. Intellectual Ventures I LLC, CBM , Paper 13 (PTAB May 22, 2014) SAP Am., Inc. v. Versata Dev. Grp., Inc., CBM , Paper 36 (PTAB Jan. 9, 2013)... 9 SiRF Tech., Inc. v. Int l Trade Comm n, 601 F.3d 1319 (Fed. Cir. 2010)... 44, 45, 50, 51 Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709 (Fed. Cir. 2014)... passim vi

8 TABLE OF AUTHORITIES (CONT D) Page Statutes 157 CONG. REC. S (daily ed. Mar. 8, 2011)... 8, 13, U.S.C passim 35 U.S.C , 6, 35, U.S.C. 102(a) U.S.C. 102(b)... 6, 7, U.S.C , 6, 35, U.S.C. 301(a)(2) U.S.C. 301(d) U.S.C. 325(e)(1)... 3 P.L (a)(1)(C)... 56, 68 P.L (a)(1)(C)(i) P.L (d)(1)... 8, 14 Regulations 37 C.F.R (a)(2) C.F.R (b) C.F.R (a) C.F.R (b) C.F.R (a)... 8, C.F.R (b)... 14, 15, Fed. Reg. 57,526 (Oct. 10, 2007) vii

9 TABLE OF AUTHORITIES (CONT D) Page 77 Fed. Reg. 48,735 (Aug. 14, 2012)... 8, Fed. Reg. 48,736 (Aug. 14, 2012)... 9, Fed. Reg. 48,756 (Aug. 14, 2012)... passim 77 Fed. Reg. 48,764 (Aug. 14, 2012)... passim viii

10 Care N Care Insurance Company, Inc. ( Care N Care ) and TriZetto Corp. ( TriZetto ) (collectively, Petitioners) request CBMR of claims 1, 6, 8, 9, 12, 13, 15, 20, 21, 24, and 25 ( Challenged Claims ) of U.S. Patent No. 7,178,020 ( 020 Patent ) (Ex. 1003). I. 37 C.F.R. 42.8: MANDATORY NOTICES A. 37 C.F.R. 42.8(b)(1): Real Party-In-Interest Care N Care and TriZetto are the real parties-in-interest. B. 37 C.F.R. 42.8(b)(2): Related Matters Patent Owner Integrated Claims Systems, LLC ( ICS ) has asserted the 020 Patent in numerous lawsuits in various federal district courts: (1) Aetna Dental, Inc., 1 No. 2:13-cv-649 (E.D. Tex.), transferred to No. 3:14-cv-1524 (D. Conn.); (2) Care N Care Ins. Co., No. 2:14-cv-735 (E.D. Tex.); (3) Cmty. Health Choice, Inc., No. 2:14-cv-737 (E.D.Tex.); (4) Molina Healthcare of Tex., Inc., No. 2:14-cv- 866 (E.D. Tex.); (5) S. Vanguard Ins. Co.,* No. 2:14-cv-83 (E.D. Tex.); (6) United Dental Care of Tex., Inc., No. 2:14-cv-72 (E.D. Tex.); (7) Wellcare of Tex., Inc., No. 2:14-cv-73 (E.D. Tex.); (8) Aetna Health Inc., No. 2:13-cv-650 (E.D. Tex.); (9) Allstate Tex. Lloyd s, No. 2:13-cv-651 (E.D. Tex.); (10) Amerisure Mut. Ins. Co., No. 2:13-cv-652 (E.D. Tex.); (11) Cigna Healthcare of Tex., Inc., No. 2:13- cv-653 (E.D. Tex.); (12) Delta Dental Ins. Co., No. 2:13-cv-654 (E.D. Tex.); (13) 1 For brevity, only the party adverse to ICS is listed in these case names.

11 Travelers Lloyds of Tex. Ins. Co., 2:13-cv-656 (E.D. Tex.), transferred to No. 3:14- cv-892 (D. Conn.); (14) Zenith Ins. Co., No. 2:13-cv-658 (E.D. Tex.); (15) Tex. Mut. Ins. Co., No. 1:13-cv-1070 (W.D. Tex.); (16) Tex. Mut. Ins. Co., No. 1:13-cv- 128 (W.D. Tex.). The 020 Patent is also the subject of a pending petition for CBMR filed by Travelers Lloyds of Texas Insurance Company and The Travelers Indemnity Company (CBM ). These cases and proceedings may affect, or be affected by, decisions here. C. 37 C.F.R. 42.8(b)(3) and (4): Designation of Lead and Back-Up Counsel and Identification of Service Information Lead: Gianni Cutri (Reg. No ) gianni.cutri@kirkland.com Back-Up: Jared Barcenas (Reg. No ) jared.barcenas@kirkland.com Postal/Hand-Delivery Address: Kirkland & Ellis LLP 300 North LaSalle Street Chicago, Illinois Telephone: (312) Facsimile: (312) Petitioners submit a Power of Attorney. 37 C.F.R (b). Petitioners consent to service: TriZetto-CBMR-SVC@kirkland.com. II. 37 C.F.R : PAYMENT OF FEES The undersigned authorize the Office to charge the fee set forth in 37 C.F.R (a) for this Petition to Deposit Account No Review of eleven (11) claims is requested; no excess claim fee is submitted. The undersigned further authorize payment for any additional fees that may be due in connection with this Petition to be charged to the above-referenced Deposit Account. 2

12 III. 37 C.F.R (A): GROUNDS FOR STANDING A. The 020 Patent Is a Covered Business Method Patent. The 020 Patent is a covered business method patent. See Section VI. B. 37 C.F.R (a): Petitioners Are Eligible to File a CBMR. Care N Care has been sued for alleged infringement of the 020 Patent in Case No. 2:14-cv-735 (E.D. Tex.), and TriZetto is indemnifying Care N Care. C. 37 C.F.R (b): Petitioners Are Not Estopped. Petitioners certify the 020 Patent is available for CBMR and Petitioners are not estopped from requesting CBMR of the Challenged Claims on the identified grounds. Petitioners certify: (1) they do not own the 020 Patent; (2) they have not filed a civil action challenging the validity of any claim of the 020 Patent; (3) the estoppel provisions of 35 U.S.C. 325(e)(1) do not prohibit CBMR of the 020 Patent; and (4) this Petition is filed after the 020 Patent was granted. IV. 37 C.F.R (B): IDENTIFICATION OF CHALLENGE Petitioners request the Challenged Claims be found unpatentable. A. 37 C.F.R (b)(1): Claims for Which CBMR Is Requested Petitioners request CBMR of the Challenged Claims. B. 37 C.F.R (b)(2): Statutory Grounds on Which the Challenge Is Based CBMR is requested pursuant to 35 U.S.C. 101, 102 and

13 C. 37 C.F.R (b)(3): Claim Construction A claim of an unexpired patent in CBMR is given the broadest reasonable interpretation in light of the specification to one having ordinary skill in the art. 37 C.F.R (b). Petitioners contend that preambles of the independent claims are not limiting. Petitioners submit, for this CBMR only, proposed constructions of certain terms under the broadest reasonable interpretation standard. 2 For all other terms, Petitioners propose the plain and ordinary meaning should be used. 1. unitary data stream Claims 1 and 15 recite a unitary data stream. ICS has proposed in district court that this phrase be construed as transmitted set of information. Ex at Ex. A at 2; Ex at Ex. A at 1. In support of this position, ICS referred to the 020 Patent stating that it teaches the transmission of a set of information as multiple related files: For example, the format of the PAC application advantageously may consist of a text file and an associated image file. (emphasis removed). Ex at 14 (quoting 020 Patent at 15:2-10). ICS further pointed to the 020 Patent at 2:26-3:3, stating that the 020 patent discloses transmitting a standard text claim form together with an attachment. Ex at 16. These portions of the specification confirm that transmitted set of information is the 2 Petitioners submit statements made by ICS as relevant to claim construction. See 35 U.S.C. 301(a)(2), (d); 37 C.F.R (a)(2). 4

14 broadest reasonable interpretation of the term unitary data stream. ICS did not dispute this conclusion in its -187 POPR. See Ex digital attachment Claim 9 recites a digital attachment. Although the 020 Patent identifies digitized images and x-rays as examples of digital attachments, the specification explains that the term digital attachment... is not limited to a digitized image or x-ray. Ex at 11: It further explains that the term digital attachment embrace[s] x-rays, CTs, MRIs, EKG or EEG recordings, i.e., strip charts, digitized video signals and that [t]he only requirements regarding digital attachments are that the information must be something that can be digitized, i.e., put into the form of a computer file.... Id. at 11: In light of these characterizations of digital attachment in the specification, the broadest reasonable construction of this term is information that can be digitized. Bysinger Decl , 36. D. 37 C.F.R (b)(4): How the Claims Are Unpatentable A detailed explanation of unpatentability is provided in Section VII. E. 37 C.F.R (b)(5): Evidence Supporting Challenge An Appendix of Exhibits is attached. Relevance of the evidence, including specific portions, is provided in Section VII. 5

15 V. PRELIMINARY STATEMENT The 020 Patent is eligible for CBMR because it clearly claims methods and corresponding apparatuses for performing data processing... used in the practice, administration, or management of a financial product or service and does not claim a technological invention. Patent Owner ICS claims that the alleged invention of the 020 Patent is computerizing the processing of insurance claims that have attachments. There is no dispute that insurance claims processing was already performed using a process that contained both computerized and manual steps. The 020 Patent states that its purported invention, computerizing those manual steps, is simply [t]he next stage in the development of claims processing systems. Ex at 3: But the Supreme Court and the Federal Circuit have confirmed this approach simply reciting a well-known, abstract idea while adding the words apply it with a computer, render the claims ineligible under 35 U.S.C Alice Corp. Pty. Ltd. v. CLS Bank Int l, 134 S. Ct. 2347, 2350 (2014). The Challenged Claims are also invalid under 35 U.S.C. 102 and 103 in view of the prior art, in particular based on: (1) U.S. Patent No. 5,258,855 ( Lech ) (Ex. 1009), and (2) U.S. Patent No. 5,054,096 ( Beizer ) (Ex. 1010), both of which are prior art under pre-aia 35 U.S.C 102(b). 6

16 As noted, Travelers also filed a petition for CBMR of the Challenged Claims (CBM ). The Board should nonetheless institute review based on Petitioners petition. First, Petitioners are not affiliated with Travelers, and have not coordinated with Travelers regarding their respective petitions. Second, Petitioners challenge more claims beyond those challenged by Travelers. Third, Petitioners prior art is different from Travelers. Fourth, Petitioners expert is not the same as Travelers. Fifth, Petitioners prior art while still prior art under pre- AIA 102(b)) is later in date than Travelers. As such, Petitioners prior art explains the state of the art in with more precision than earlier prior art, due to the evolution of the state of the art. Sixth, Petitioners cite and apply additional Federal Circuit and PTAB precedent beyond that cited by Travelers, including some that issued after Travelers filed its petition, most notably the recent Federal Circuit decisions in Ultramercial (issued Nov. 14, 2014), DDR Holdings (issued Dec. 5, 2014), and Content Extraction and Transmission (issued Dec. 23, 2014). These additional decisions further support finding that the 020 Patent is a CBM patent and that it is patent-ineligible under 35 U.S.C VI. THE 020 PATENT IS A COVERED BUSINESS METHOD PATENT. The AIA and USPTO Rules define a covered business method ( CBM ) patent as one that claims a method or corresponding apparatus for performing data processing or other operations used in the practice, administration, or 7

17 management of a financial product or service, except that the term does not include patents for technological inventions. AIA 18(d)(1); 37 C.F.R (a). The AIA and USPTO Rules thus define a two-part test to determine whether a patent is a covered business method patent and as described below, the 020 Patent satisfies both parts of the test. A. The 020 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. According to the AIA s legislative history, patents should be eligible for CBMR if they cover any ancillary activities related to a financial product or service, including... marketing, customer interfaces, Web site management and functionality, transmission or management of data, servicing, underwriting, customer communications, and back office operations-e.g., payment processing, stock clearing. 157 CONG. REC. S (daily ed. Mar. 8, 2011) (statement of Sen. Schumer) (Ex. 1011) (emphasis added). The Board has explained that the phrase financial product or service should be interpreted broadly. Apple Inc. v. SightSound Techs., LLC, CBM , Paper 14 at 11 (PTAB Oct. 8, 2013); see also 77 Fed. Reg. 48,735 (Aug. 14, 2012) (Ex. 1024) ( financial product or service should be interpreted broadly ). It has also explained that the word financial is just an adjective that simply means relating to monetary matters. SAP Am., Inc. v. Versata Dev. Grp., Inc., CBM , Paper 36 at 23 (PTAB 8

18 Jan. 9, 2013). Consequently, the definition encompasses patents that claim activities that are financial in nature, incidental to a financial activity or complementary to a financial activity. CRS Advanced Techs., Inc. v. Frontline Techs., Inc., CBM , Paper 17 at 7 (PTAB Jan. 23, 2013). In addition, [a] patent having one or more claims directed to a covered business method is a covered business method patent for purposes of the review, even if the patent includes additional claims. 77 Fed. Reg. at 48,736 (Aug. 14, 2012) (Ex. 1024); see also Liberty Mut. Ins. Co. v. Progressive Cas. Ins. Co., CBM , Paper 66 at 6 (PTAB Jan. 23, 2014) (entire patent eligible for CBMR where the subject matter of at least one claim is directed to a covered business method ). In other words, as Patent Owner ICS has conceded, [a] patent need have only one claim directed to a covered business method to be eligible for review. Ex at Claims 8, 21, and 36 Are Expressly Directed to a Method and Corresponding Apparatus for Performing Data Processing Used in the Administration of a Financial Product. The 020 Patent contains at least three claims 8, 21, and 36 that are expressly directed to a method or corresponding apparatus for performing data processing... used in the practice, administration, or management of a financial product or service, namely, processing insurance claim forms. Claims 8 and 21 are challenged in this petition (while Claim 36 is challenged in a separate petition 9

19 filed by Petitioners) and are directed to an insurance claim form. Ex at Claims 8 and 21 ( The digital device as recited in [Claim 1 (for Claim 8), or Claim 15 (for Claim 21)] wherein the unitary data stream comprises an insurance claim form. ). 3 Apparatus Claim 8 is essentially an apparatus counterpart of method Claim 36. Id. at Claims 8, 36 ( The digital device as recited in claim 1... wherein the unitary data stream comprises an insurance claim form. ) Apparatus Claim 21 is likewise in essence an apparatus counterpart to method Claim 36, with only minor differences from Claim 8. Id. at Claims 15, 21. These three claims are a method and corresponding apparatuses for processing data in an insurance claim form and thus expressly relate to insurance, which is quintessentially a financial product or service. See Liberty Mut. Ins. Co. v. Progressive Cas. Ins. Co., CBM , Paper 13 at 6 (PTAB Jan. 27, 2013) (noting that health insurance, property-casualty insurance, and liability insurance are all financial product[s] ); see also AMERICAN HERITAGE COLLEGE DICTIONARY at 705 (3d ed. 1997) Ex (defining insurance as an agreement to indemnify another against specified loss in return for premiums paid ). Indeed, the Board has explained that [a]djudicating an insurance claim and processing payment for that claim are inherently financial activities for purposes of CBM standing. Gillman v. 3 Emphasis has been added in the language citing the 020 Patent claims throughout this petition for ease of review. 10

20 StoneEagle Servs., Inc., CBM , Paper 11 at 8 (PTAB Feb. 18, 2014) (denying institution on other grounds). In its Patent Owner Preliminary Response to Travelers petition for CBMR ( -187 POPR ), ICS argues that the claimed invention ha[s] no bearing on the practice, administration or management of insurance. Ex at 19 (emphasis added). But the Background of the Invention in the 020 patent states that High administrative costs for filing and processing health insurance claims have been the bane of the health insurance industry from its inception. Ex at 1: The patent goes on to state that [i]t is also estimated that if a coherent electronic system could be implemented, it would reduce these administrative costs to $15 per PAC and $5 per Final Payment claim. Ex at 4: As explained below, the patent purports to address these administrative costs (albeit merely by attempting to computerize the well-known idea of processing and administering insurance claim forms). Thus, ICS s claim that the 020 Patent does not relate to the administration of a financial product is untenable. ICS also states in its -187 POPR that the claim [sic] inventions have no affect [sic] on... the determination by an insurance company whether the insurance claim is approved, and the extent to which any money is paid from the insurance company to the medical professional. Ex at 19. But that assertion is undermined by the same filing, wherein ICS characterizes the

21 Patent as related to the approval of claims and payment to medical professionals: Insurance companies often require service providers (e.g. doctors, dentists) to submit a PAC [Prior Authorization Claim] Application before the insurance company approves an expensive medical procedure. Ex at 10. The specification explains that [i]n the area of Prior Approval claims, the goals of the insurance companies are to validate the necessity of the procedure and to determine whether the patient s insurance policy obligates the insurance company to pay for [it]. Ex at 4:17 20 (emphasis added). 2. The 020 Patent Describes Its Claimed Invention As Being Directed to Data Processing Used in the Administration of a Financial Product. The specification of the 020 Patent confirms that the claimed invention is directed to CBM subject matter. The alleged invention of the 020 Patent relates to an AIC [attachment integrated claims] system for preparing and processing digital insurance claims... (Ex at 1:23 25), and the first purpose attributed to the alleged invention is to create a coherent system that allows for the electronic filing, transmission, and processing of insurance claims with attachments (id. at 8:14 17). Processing insurance claims electronically (with or without attachments) is obviously data processing, and insurance claims are one facet of the administration of an insurance policy. 12

22 3. ICS s Own Characterizations of the 020 Patent Confirm It Relates to a Financial Product or Service. Patent Owner ICS has asserted the 020 Patent in Tex. Mut. Ins. Co., No. 1:13-cv-1070 (W.D. Tex.). In its Opening Claim Construction Brief there, ICS said that the asserted patents (of which the 020 Patent was one) cover... systems and methods for processing insurance claims and the attachments that typically accompany them. Ex at 1 (emphasis added). In addition, ICS summary of the Claimed Technology in the -187 POPR mentions insurance 15 times and describes the 020 Patent s claimed invention as being directed to insurance claims processing. Ex at That the 020 Patent Has Been Asserted Against Insurance Companies, and ICS s Infringement Allegation, Confirm It Relates to a Financial Product or Service. That the 020 Patent relates to a financial product or service is confirmed both by (1) ICS s assertion of it against numerous insurance companies, and (2) ICS s assertions as to what specific instrumentality allegedly infringes the 020 Patent. According to the AIA s legislative history, if a patent holder alleges that a financial product or service infringes its patent, that patent shall be deemed to cover a financial product or service. 157 CONG. REC. S1365 (daily ed. Mar. 8, 2011) (statement of Sen. Schumer) (Ex. 1011). While not dispositive, the Board views infringement allegations as one factor to be considered in deciding whether a patent is directed to CBM subject matter. PNC Fin. Servs. Grp., Inc. v. 13

23 Intellectual Ventures I LLC, CBM , Paper 13 at 14 (PTAB May 22, 2014). ICS has asserted the 020 Patent in litigation against at least 14 insurance and insurance claims processing companies, including well known insurance companies such as Allstate, Travelers, and Aetna, see Section I.B, supra, and ICS s infringement allegations confirm that ICS is targeting the processing of insurance claims. In Care N Care Ins. Co., No. 2:14-cv-735 (E.D. Tex.), for example, the very first sentence of ICS court-mandated infringement contentions for the 020 Patent claim state that ICS contentions are directed to Defendant Care N Care s insurance claim processing systems and methods that allow for the electronic submission and processing of insurance claims. Ex at 1. B. The Challenged Claims Do Not Recite a Technological Invention. The definition of a CBM patent does not include patents for technological inventions. AIA 18(d)(1); 37 C.F.R (a). This exception excludes only those patents whose claimed subject matter as a whole (1) recites a technological feature that is novel and unobvious over the prior art and (2) solves a technical problem using a technical solution. 37 C.F.R (b); see also 77 Fed. Reg. 48,736 (Aug. 14, 2012) (Ex. 1024) ( a technical problem using a technical solution is with respect to the claimed subject matter as a whole ); 157 CONG. REC. S1364 (daily ed. Mar. 8, 2011) (statement of Sen. Schumer) (only those 14

24 patents whose novelty turns on a technological innovation over the prior art and [which] are concerned with a technical problem which is solved with a technical solution and which requires the claims to state the technical features which the inventor desires to protect should be excluded from CBMR). Ex The Patent Office and the PTAB have made clear that both prongs must be met for a patent to be excluded from CBMR. 77 Fed. Reg. 48, (Ex. 1024) (explaining that conjunctive test represents the best policy choice ); see also Liberty Mut. Ins. Co. v. Progressive Cas. Ins. Co., CBM , Paper 15 at 10 (PTAB Feb. 12, 2013) ( To qualify under the technological invention exception, the claimed subject matter as a whole must satisfy both of the following prongs. ). If at least one challenged claim fails the technological invention exception, the entire patent is not exempt from CBMR. See Am. Express Co. v. Lunenfeld, CBM , Paper 17 at 13 (PTAB June 18, 2014). None of the Challenged Claims meet either prong of the test. 1. The Challenged Claims Do Not Recite a Technological Feature That Is Novel and Non-obvious Over the Prior Art. None of the challenged claims meet the first prong, namely, recit[ing] a technological feature that is novel and unobvious over the prior art. 37 C.F.R (b). Mere recitation of known technologies, such as computer hardware, communication or computer networks, software, memory, computer-readable storage medium, scanners, display devices or databases, or [r]eciting the use of 15

25 known prior art technology to accomplish a process or method, even if that process or method is novel and non-obvious, or [c]ombining prior art structures to achieve the normal, expected, or predictable result of that combination will not typically render a patent a technological invention. 77 Fed. Reg. 48,756, 48,764 (Aug. 14, 2012) (Ex. 1025); Am. Express Co., CBM , Paper 17 at A claim recites a technological invention only if it recites novel technological features. See Bloomberg Inc. v. Markets-Alert PTY Ltd., CBM , Paper 18 at 6 7 (PTAB Mar. 29, 2013); CRS Advanced Techs., Inc., CBM , Paper 17 at 9. The Challenged Claims recite only the use of well-known technology that was common-place when the 020 Patent s application was filed. Claim 1 is a digital device operatively coupled to a computer network but recites only generic computer technology consisting of: (1) a digital device that is operatively coupled to (2) a first network component and (3) a second network component. [D]igital device[s] and network component[s] are the epitome of generic and well-known technologies (Ex at 1:48 54, 2:35 54), and simply operatively coupl[ing] them does not transform the claim into a technological invention. See 77 Fed. Reg. 48,756, 48,764. Claim 6 depends from Claim 1 and recites only generic computer hardware consisting of a digital device which is a server responsive to specialized 16

26 software. Neither server[s] nor software were novel or unobvious technology. Instead, software is just an inherent feature of the generic server, as confirmed by Patent Owner ICS s admission in its -187 POPR that [l]ike any common computer, the server... would be unable to function without computer software. Ex at 11. Moreover, the process performed by the recited server is not novel or non-obvious, and even if it were, that would not transform the server into a technological invention. See 77 Fed. Reg. 48,756, 48,764 (not enough merely to [r]ecit[e] the use of known prior art technology to accomplish a process or method, even if that process or method is novel and non-obvious ). Claim 8 depends from Claim 1 and adds only that the unitary data stream comprises an insurance claim form. Insurance claim forms are not a technological feature at all and existed long before the 020 Patent s application. Ex at 1: Claim 9 depends from Claim 1 and adds only that the Nth one of the N fields contains a digital attachment and the rest of the N fields contain text data. Like insurance claim forms, text data is not a technological feature, nor is a digital attachment. Claim 12 depends from Claim 1 and adds only that one of the first and second networked components is a mainframe computer. The 020 Patent admits that mainframe computers are generic, well-known prior art technologies (Ex. 17

27 1003 at 4:42 51 ( An example of a hybrid system of claim processing currently in use... typically has at least one mainframe computer 350. ).) Indeed, Patent Owner ICS admits that [a]t the time the application leading to the 020 Patent was filed, mainframe computers were widely adopted by large corporate and government entities, including insurance companies. Ex at 7 8. Claim 13 depends from Claim 12 and adds only that the mainframe computer receives only ones [sic] of the N fields containing text data. This slight refinement of the recited process of copying information does not constitute a technological feature, let alone a novel and unobvious technological feature. And because the remainder of the claim recites only generic, well-known prior art technology, it does not matter whether the recited process (or this aspect of it) was novel or unobvious. 77 Fed. Reg. 48,756, 48,764 ( [r]eciting the use of known prior art technology to accomplish a process or method not enough, even if that process or method is novel and non-obvious ); Am. Express Co., CBM , Paper 17 at Claim 15 is nearly the same as Claim 1 and for the same reasons recites no novel or non-obvious technological features. The only difference is that in claim 15, the N fields are arranged in a predetermined order, and whether each field is sent to a first network component and/or a second network component is determined by [its] position in [the] predetermined order rather than in response 18

28 to... field labels. Like with Claim 13, this slight refinement of the recited process of copying information does not constitute a technological feature, let alone a novel and unobvious one. And because the remainder of the claim recites only generic, well-known prior art technology ( digital device[s] and network component[s] ), it does not matter whether the recited process (or this aspect of it) was novel or unobvious. 77 Fed. Reg. 48,756, 48,764; Am. Express Co., CBM , Paper 17 at Claim 20 depends from Claim 15 and adds only that the digital device is a server responsive to specialized software. As explained for Claim 6 (which recites the same limitation), neither server[s] nor software were novel or unobvious technology. Instead, software is just an inherent feature of the generic server, as confirmed by Patent Owner ICS s admission that [l]ike any common computer, the server... would be unable to function without computer software. Ex at 11. Moreover, the process performed by the recited server is not novel or non-obvious, but even if it were, that would not transform the server into a technological invention. See 77 Fed. Reg. 48,756, 48,764 (not enough merely to [r]ecit[e] the use of known prior art technology to accomplish a process or method, even if that process or method is novel and non-obvious ). Claim 21 depends from Claim 15 and adds only that the unitary data stream comprises an insurance claim form. As explained for Claim 8 (which recites the 19

29 same limitation), insurance claim forms are not a technological feature and existed long before the 020 Patent s application. Ex at 1: Claim 24 depends from Claim 15 and adds only that one of the first and second networked components is a mainframe computer. As explained for Claim 12 (which recites the same limitation), mainframe computers are generic, wellknown prior art technologies. The 020 Patent admits this (Ex at 4:42 51), as does ICS in its -187 POPR (Ex at 7 8). Claim 25 depends from Claim 24 and adds only that the mainframe computer receives only ones [sic] of the N fields containing text data. As explained for Claim 13 (which recites the same limitation), this slight refinement of the recited process of copying information does not constitute a technological feature, let alone a novel and unobvious technological feature, and it does not matter whether the recited process (or this aspect of it) was novel or unobvious. 77 Fed. Reg. 48,756, 48,764. In sum, none of the Challenged Claims recites a technological feature that is novel and non-obvious over the prior art. Instead, they recite only well-known and extremely generic technology such as server[s], and mainframe computer[s], and the extremely generic (and also well-known) digital devices and networked component[s]. Even when examined as a whole, none of the Challenged Claims recite a combination of technological features that could be considered novel or 20

30 non-obvious. Moreover, the methods described in the Challenged Claims are not novel and non-obvious, and even if they were that would not transform these claims into technological inventions. See 77 Fed. Reg. 48,756, 48,764 (not enough merely to [r]ecit[e] the use of known prior art technology to accomplish a process or method, even if that process or method is novel and non-obvious ). The technological invention exception does not apply because the Challenged Claims all fail to recite any novel and non-obvious technological feature. 2. The Challenged Claims Do Not Solve a Technical Problem Using a Technical Solution. By its own admission, the 020 Patent does not solve a technical problem with a novel technical solution. Rather, it purports to solve an alleged business problem, and it purportedly does this simply by [c]ombining prior art structures to achieve the normal, expected, or predictable result of that combination. 77 Fed. Reg. 48,756, 48,764 (Aug. 14, 2012) (Ex. 1025). This is an independent reason that the technological invention exception does not apply. See 37 C.F.R (b). a. The Alleged Problem Is Non-Technical. The 020 Patent attempts to address an alleged business problem, namely: how to process insurance claims that have attachments. Ex at 8:14 19 (purpose of present invention is to create a coherent system that allows for the electronic filing, transmission, and processing of insurance claims with 21

31 attachments ). According to the 020 Patent, insurance claims have been processed entirely on paper. Id. at 1: Claims processing evolved with the introduction of the mainframe computer at insurance companies, which still required insurance claim forms to be submitted to the insurance company manually (i.e., in paper), but allowed for electronic processing within a given insurance company. Id. at 1:48 54; see also id. at 1:55 56 ( [M]ainframe computers were purchased and installed internally at the insurance companies. ). The next advancement was electronic filing of claims forms whereby an electronic claim form would be filled out by a healthcare provider and transmitted, as a computer file, to the insurance company. Id. at 2:4 15. This advance eliminate[d] the manual re-entry of information into the insurance company mainframe. Id. at 2:8 10. Thus, in general, a coherent system for the electronic filing, transmission, and processing of insurance claims already existed and was employed by thousands of [healthcare] providers and hundreds of insurance companies at the time the 020 Patent s application was filed. Id. at 2: However, according to the 020 Patent, there were still some types of claims known as claims with attachments that were handled using a hybrid system involving some electronic and some manual (i.e., hard copy / paper) processing. Id. at 2:62 66, 3: In other words, the process for claims with attachments was well-known, but partially manual (i.e., paper-based). Continuing to process these claims 22

32 partially in paper form was allegedly labor intensive, prone to problems, and slow, which the patentee says made it time-consuming, costly and irritating. Id. at 3:66 4:2. The 020 Patent s invention allegedly was motivated by the desire to overcome the problems associated with the... hybrid system for processing claims with attachments. Id. at 7:66 8:1. The 020 Patent s proposed solution to the alleged problems of paper-based processing of insurance claims with attachments was to computerize[] this process, which it described as [t]he natural next stage in the development of claims processing systems. Id. at 3: The alleged problems associated with the hybrid system for processing claims with attachments that it was labor intensive, prone to problems, and slow, and time-consuming, costly and irritating are not technical problems. No scientific or technical knowledge is needed to understand the alleged problem that the 020 Patent seeks to solve. This demonstrates that the alleged problem is not technical but rather is a generic business process problem faced by any business that relies on paper forms. In Coupa Software, Inc. v. Ariba, Inc., the Board addressed a patent whose goal was making a business process more efficient, and concluded that such a goal does not qualify as solv[ing] a technical problem : 23

33 Petitioner also argues that the... patent makes clear that the problem being addressed was to make more efficient the business process of purchasing which is not a technical problem.... [W]e agree with Petitioner that the... patent s suggestion that the invention improves the efficiency of the procurement process is not a technical solution to a technical problem. Rather, the solution is based on the improvement of a business process, which is directed to the problem of how that process is presented to users, as opposed to being a technical problem. Coupa Software, Inc. v. Ariba, Inc., CBM , Paper 11 at 9 10 (PTAB July 25, 2014). Here, similarly, the 020 Patent is directed at solving an alleged problem of (in)efficiency in a particular business process namely, paper-based insurance claims processing which is not a technical problem. b. To the Extent the Challenged Claims Solve Any Alleged Problem, They Do So Only by Reciting Well-Known Prior Art Technology. The Challenged Claims do not us[e] a technical solution to the alleged problems and therefore do not qualify for the technological invention exception. The Challenged Claims do recite certain well-known, prior art technological features, such as digital device[s], server[s], software, and mainframe computer[s]. However, for purposes of the technological invention exception, it is not enough that the invention makes use of technological systems, features, or components, because [u]se of technology is ubiquitous and on some level 24

34 underlies virtually every invention. Coresource, Inc. v. Quality Healthcare Intermediary, LLC, CBM , Paper 9 at 8 (PTAB July 28, 2014). Moreover, as already explained, every technological feature recited in the Challenged Claims is generic, well-known computer hardware that was in the prior art. See Section VI.B.i, supra. VII. IT IS MORE LIKELY THAN NOT THAT THE CHALLENGED CLAIMS ARE UNPATENTABLE. A. Description of the Alleged Invention of the 020 Patent The 020 Patent attempts to solve an alleged problem related to processing insurance claim forms. See Section VI.A.2. It admits that at the time of the alleged invention, insurance claims processing had already largely been computerized more specifically, that a coherent system already existed that allowed for the electronic filing, transmission, and processing of insurance claims, and that this system was employed by thousands of providers and hundreds of insurance companies. Ex at 2:51 54, 1:48 56, 2:4 15. According to the 020 Patent, however, claims with attachments were still handled using a hybrid system that involved some electronic and some manual (i.e., hard copy / paper) processing. Id. at 2:62 66, 3:58 4:2. It proposed to solve this problem by computerize[ing] this process, which it describes as [t]he natural next stage in the development of claims processing systems. Id. at 3:18 20, 7:66 8:10. Consistent with this understanding, the 020 Patent s exemplary 25

35 embodiment of the essential steps of the claimed invention (id. at 12:30 34) amounts to little more than describing the existing paper-based process and saying do it on a computer. Compare, e.g., id. at 5:7 6:49 ( the PAC form is filled out entirely by hand... [t]he form and the x-rays are placed in the envelope... the envelope is mailed ) with id. at 12:30 67 (alleged invention calls for [f]iling out [the] PAC form on the computer screen; [d]igitizing, e.g., scanning, the patient s x- ray [and]... [t]ransmitting... to the designated insurance company ). Indeed, that the 020 Patent simply says do it on a computer is well illustrated by Patent Owner ICS s own summary of the alleged invention. Ex at 9 (patentee sought to eliminate, to the maximum extent possible, all processing steps which are in any way connected with the presence of a hard copy attachment.) ICS goes on to assert that the claimed invention was intended to replace the traditional system that involved paper submissions (id. at 41) in other words, computerizing a paper process which it purports to do simply by reciting well known, conventional, and generic computer technology. B. Ground 1: The Challenged Claims Are Not Patent-Eligible Under 35 U.S.C The Challenged Claims are not patent eligible under 35 U.S.C They all embody the abstract idea of transmitting or copying information from a source to a destination, and add little more than a token, conventional, and wholly generic computer implementation. Also, none of the Challenged Claims satisfy the Federal 26

36 Circuit s machine-or-transformation test, which is a useful and important clue that they are not patent-eligible. See Bilski v. Kappos, 561 U.S. 593, (2010). Importantly, no presumption of eligibility attends the section 101 inquiry. Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 717 (Fed. Cir. 2014) (Mayer, J., concurring). Crucially, the Federal Circuit has essentially already held that the Challenged Claims are not patent eligible. In Content Extraction and Transmission v. Wells Fargo Bank, N.A., No , et al., 2014 WL (Fed. Cir. Dec. 23, 2014) (Ex. 1018) (hereinafter CET ), the Federal Circuit held that the claims in Lech were patent ineligible under Section 101. As shown below, those claims overlap almost entirely with the Challenged Claims, anticipating nearly every one. Therefore, as the claims in Lech are patent ineligible, so too are the Challenged Claims here. 1. Claims That Recite Abstract Ideas Implemented Using General-Purpose Computer Components Are Not Patent- Eligible. Section 101 of the Patent Act has long had an important implicit exception, that [l]aws of nature, natural phenomena, and abstract ideas are not patentable. Alice, 134 S. Ct. at In Mayo Collaborative Servs. v. Prometheus Labs., Inc. and Alice Corp. Pty. Ltd. v. CLS Bank Int l, the Supreme Court established a twostep framework for applying this exception to 101 patent eligibility. Alice,

37 S. Ct. at 2355; see Mayo Collaborative Servs. v. Prometheus Labs., Inc., 132 S. Ct. 1289, (2012). The first step is to determine whether the claims at issue are directed to one of those patent-ineligible concepts laws of nature, natural phenomena, or abstract ideas. Alice, 134 S. Ct. at 2355; see Mayo, 132 S. Ct. at Regardless of what statutory category... a claim s language is crafted to literally invoke, it is necessary to look to the underlying invention for patent-eligibility purposes. CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d 1366, 1374 (Fed. Cir. 2011). In other words, the claimed invention should be viewed in its simplest form. See Dealertrack, Inc. v. Huber, 674 F.3d 1315, 1333 (Fed. Cir. 2012). [W]ell-established, fundamental concepts fall within the category of abstract ideas. Cyberfone Sys., LLC v. CNN Interactive Grp., Inc., 558 F. App x 988, 991 (Fed. Cir. 2014) (Ex. 1022). If they are directed to a patent-ineligible concept, the second step is to ask what else is there in the claim...? Alice, 134 S. Ct. at 2355; Mayo, 132 S. Ct. at This second step is a search for an inventive concept, that is, an element or combination of elements that is sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the ineligible concept itself. Alice, 134 S. Ct. at 2355; Mayo, 132 S. Ct. at A claim that recites an abstract idea must include additional features to ensure that the claim is more 28

38 than a drafting effort designed to monopolize the abstract idea. Alice, 134 S. Ct. at 2357; see also Mayo, 132 S. Ct. at Simply appending conventional steps, specified at a high level of generality, [is] not enough to supply an inventive concept. Alice, 134 S. Ct. at 2357; see also Mayo, 132 S. Ct. at For example, mere recitation of a generic computer cannot transform a patentineligible abstract idea into a patent-eligible invention, because [g]iven the ubiquity of computers... wholly generic computer implementation is not generally the sort of additional feature that provides any practical assurance that the process is more than a drafting effort designed to monopolize the abstract idea itself. Alice, 134 S. Ct. at 2358; see also Mayo, 132 S. Ct. at It is also not enough to limit[] an abstract idea to one field of use, or add token postsolution components, Kappos, 561 U.S. at , or limit the use of the idea to a particular technological environment, Alice, 134 S. Ct. at In addition to the two-step framework of Mayo and Alice, the Supreme Court has said that the Federal Circuit s machine-or-transformation test can play a part in analyzing patent eligibility under 101. See Kappos, 561 U.S. at 593. The machine-or-transformation test asks whether the claimed invention (1) is tied to a particular machine or apparatus or (2) transforms a particular article into a different state or thing. In re Bilski, 545 F.3d 943, 954 (Fed. Cir. 2008). To satisfy the test, the use of a specific machine or transformation of an article must 29

39 impose meaningful limits on the claim s scope. Id. at 961. Simply manipulating public or private legal obligations or relationships, business risks, or other such abstractions cannot meet the test because they are not physical objects or substances, and they are not representative of physical objects or substances. Ultramercial, 772 F.3d at 717. While not dispositive, the test can provide a useful and important clue to patent eligibility. Kappos, 561 U.S. at When analyzing patent eligibility under 101, the Supreme Court endorsed the notion that, where the system claims are no different from the method claims in substance, they should rise and fall together. Alice, 134 S. Ct. 2360; see also Ultramercial, 772 F.3d at 712 (expressly analyzing only 1 of 16 patent claims under 101 because other claims of the patent [were] drawn to a similar process and thus suffer[ed] from the same infirmity ). This is to avoid letting patent eligibility depend simply on the draftsman s art. Id. (quoting Mayo, 132 S. Ct. at 1294). The Federal Circuit has likewise affirmatively noted that system claims that closely track method claims and are grounded by the same meaningful limitations will generally rise and fall together. Accenture Global Servs., GmbH v. Guidewire Software, Inc., 728 F.3d 1336, 1341 (Fed. Cir. 2013). This is particularly true where method and system claims [are] so closely related that the system claim essentially implement[s] the process of the method claim on a general purpose computer. Id. 30

40 2. Alice Step 1: The Challenged Claims Are Drawn to an Abstract Idea. The concern underlying the exception to 101 is one of pre-emption. Alice, 134 S. Ct. at Thus, it is worth noting, as a preliminary matter, the incredibly broad range of technologies and concepts the 020 Patent covers and pre-empts (at least according to Patent Owner ICS). First, in the district court case against Petitioner Care N Care, ICS claims that a system and method allowing the electronic submission and processing of insurance claims and corresponding electronic attachments, and the auto adjudication of insurance claims (the Insurance Claim System ) infringes the 020 patent. Ex at 4. ICS made the exact same allegations against at least a dozen insurers and medical providers in a spate of lawsuits filed over the last year and half. ICS further claims that not only those companies but their vendors, insurance providers, customers and others infringe the 020 patent (Ex at 5) and that, further, anyone processing claims according to an industry standard for formatting insurance claims (the ANSI ASC X12 standard) is also an infringer. In other words, ICS seeks to preempt the entire field of the electronic submission and processing of insurance claims and corresponding electronic attachments as well as the auto adjudication of insurance claims. Ex at 4. ICS claims that despite the [insurance] industry examples described in the specification, the 020 Patent is not limited to insurance claim processing. Ex. 31

41 1008 at 12. Instead (again according to ICS), the 020 Patent covers wide swaths of electronic data processing, including for example processing research data at academic universities whenever non-text information (e.g., scanning microscope images, graphs) [are] generated as part of that research, and use of mainframe computers by law enforcement whenever images such as photographs of crime scenes and finger prints are associated with text data. Id. Thus, ICS is apparently signaling its intention to extend its licensing campaign to universities and law enforcement by wielding the abstract idea and prior computer concepts disclosed in the 020 Patent to disrupt and preempt the use of attachments in the university and law enforcement settings. But in doing so, the Challenged Claims risk disproportionately tying up the use of the underlying idea[], Alice, 134 S. Ct. at This is strong evidence that the Challenged Claims are ineligible for patent protection. As noted, the first step in the 101 analysis is to determine whether the claims at issue are directed to one of those patent-ineligible concepts such as an abstract idea. Alice Corp., 134 S. Ct. at 2355; see Mayo, 132 S. Ct. at The Challenged Claims clearly are. Claim 1 claims a digital device that is operatively coupled to a first network component and a second network component. The digital device receive[s] a unitary data stream [transmitted set of information] comprising a set 32

42 of N fields that each have a field label. Based on the labels of the fields, the digital device transfer[s] the contents of a first subset of the N fields to the first network component, and transfer[s] the contents of a second subset of the N fields to the second network component. The claim also adds a few trivial limitations like that N is a positive integer greater than 1, i.e., that there are at least two pieces of information being copied. Viewed in its simplest form, Claim 1 simply recites the abstract idea of transmitting or copying information from a source to a destination. That it repeats the process twice sending a first subset of information to a first network component and a second subset to a second network component is simply repeating the abstract idea twice. Indeed, Claim 1 does not even require that the two subsets of information be different. Copying information from a source to a destination is something that humans have been doing on paper for thousands of years indeed, essentially since the dawn of written language. For example, until they were largely supplanted by the printing press, scribes in the Middle Ages would laboriously hand-produce verbatim copies of written works; these were known as manuscripts (from the Latin manu scriptus, literally written by hand ). See Peter K. Yu, Of Monks, Medieval Scribes, and Middlemen, 2006 Mich. St. L. Rev. 1, 3 4, 10 (2006) (Ex. 1015). Scribes would begin with an existing written text (a first file ) 33

43 and copy each word ( identifiable field ) onto new parchment or vellum (a second file ). The 020 Patent itself offers another, more recent example from the field of insurance claims processing; it describes that in the prior art, mainframe computers were purchased and installed internally at the insurance companies.... There were many virtues to these early systems, primarily with respect to decreased administrative costs, but a major drawback was that the data for each paper claim had to be entered into the computer to form an electronic claim. This necessitated the manual transcription of exactly the same information that had been handwritten into the original paper claim before it was sent to the insurance company. Ex at 1:55 2:3. Thus, the applicant acknowledged that then-existing processes for handling insurance claims involved receiving hard copy / paper claim forms (i.e., a first file ), and manually transcribing (i.e., copying ) information like patient information, date, provider name, etc. (i.e., the identifiable fields ) into corresponding fields in a document (i.e., a second file ) on the mainframe computer. Id.; see also id. at 5:7 6:49. More examples from other times and other fields of endeavor could fill volumes. Copying information from a source to a destination is indisputably one of those well-established, fundamental concepts that falls within the category of abstract ideas. See 34

44 Cyberfone, 558 F. App x at 991. Claims 6, 8, 9, 12, and 13, because they all depend from Claim 1, are likewise directed to this abstract idea. As noted, Claim 15 is nearly the same as Claim 1, the difference being that in Claim 15, the N fields are arranged in a predetermined order, and whether each field is sent to a first network component and/or a second network component is determined by [its] position in [the] predetermined order rather than in response to... field labels. Thus, for the same reasons explained above for Claim 1, Claim 15 is similarly directed to the abstract idea of transmitting or copying information from a source to a destination. See Accenture, 728 F.3d at 1341 (claims should rise and fall together where they are closely related or grounded by the same meaningful limitations ; Ultramercial, 772 F.3d at 712 (analyzing only a representative claim under 101 because other claims of the patent [were] drawn to a similar process and thus suffer[ed] from the same infirmity ). In CET, the Federal Circuit recently considered patent claims that are remarkably similar to the Challenged Claims, disposing of them as patentineligible under 101. See CET, 2014 WL , at *4. In CET, the patent at issue, U.S. Pat. No. 5,258,855, issued to Robert Lech, et al. (hereinafter Lech ). Importantly, this same patent provides the basis for Petitioners 102 and

45 arguments below. Thus, given the substantial overlap between Lech and the Challenged Claims, the Federal Circuit s holdings are particularly instructive. The claims at issue in CET were not patent-ineligible because they were drawn to the abstract idea of 1) collecting data, 2) recognizing certain data within the collected data set, and 3) storing that recognized data. Id. at *3. Of these claims, the Federal Circuit explained that the concept of data collection, recognition, and storage is undisputedly well-known. Indeed, humans have always performed these functions. Id. at *3. The same is true in the instant case, including because the patentee himself confirmed that the copying of data from one file to another was already well known by the time of the invention. See Ex at 1:55 2:3 (admitting that, in the prior art systems, the data for each paper claim had to be entered into the computer to form an electronic claim which was accomplished by transcribing exactly the same information that had been handwritten into the original paper claim before it was sent to the insurance company ). And like the patentee in CET, ICS cannot escape the conclusion that its patents are drawn to an abstract idea by pointing to the use of a computer, scanner, or other bit-processing device. The Federal Circuit explicitly rejected the argument that claims do not cover an abstract idea because human minds are unable to process and recognize the stream of bits output by a scanner, holding 36

46 that the claims in Alice also required a computer that processed streams of bits, but nonetheless were found to be abstract. See CET, 2014 WL , at *3. Cyberfone Sys., LLC v. CNN Interactive Grp., Inc., likewise concerned patent claims very similar to the Challenged Claims, holding that they were directed to an abstract concept and patent-ineligible under 101. See 558 F. App x 988, (Fed. Cir. 2014). The claims in Cyberfone recited a method comprising (1) obtaining data transaction information from a single transmission, (2) forming a plurality of different exploded data transactions from the single transmission, and (3) sending said different exploded data transactions over a channel to said different destinations.... Id. at 990. In the court s view, the claimed method essentially required obtaining data, exploding the data, i.e., separating it into component parts, and sending those parts to different destinations. Id. Noting that using categories to organize, store, and transmit information is well-established, the Federal Circuit concluded that the idea of collecting information... then separating and transmitting that information according to its classification, is an abstract idea that is not patent-eligible. Id. at 992. The Challenged Claims are like the claims in Cyberfone but even more abstract because they do not require any data be classified or categorized before being sent on. Indeed, nearly all of the Challenged Claims can clearly be described as directed to methods of obtaining data... separating it into component parts, 37

47 and sending those parts to different destinations that the Federal Circuit in Cyberfone held embodied an abstract idea. Cyberfone, 558 F. App x at Alice Step 2: Nothing in the Challenged Claims Supplies an Inventive Concept. Nothing in the Challenged Claims, either individually or viewed as an ordered combination (Alice, 134 S. Ct. at 2355), supplies an inventive concept sufficient to transform the embodied abstract idea into a patent-eligible invention. At best, the Challenged Claims add only token, conventional computer hardware, set forth, if at all, at a high level of generality. In other words, the Challenged Claims do precisely what the Supreme Court has said is insufficient for 101: they recite an abstract idea and then say apply it with a computer. Alice, 134 S. Ct. at Consequently, the Challenged Claims all fail step two of the Mayo-Alice framework. The Challenged Claims also all fail the Federal Circuit s machine-ortransformation test because none of the machines recited impose meaningful limits on the claim s scope (indeed, some of the Challenged Claims recite no machines at all) and because they are directed merely at collection and organization of data. This fact is a useful clue in the second step of the Alice framework that they are not patent-eligible. Ultramercial, 772 F.3d at 716; see also Kappos, 561 U.S. at

48 Here again, CET is instructive. Examining the claims in Lech, which overlap almost entirely with the Challenged Claims here, the Federal Circuit explained that the claims in Lech merely recite the use of this existing scanning and processing technology to recognize and store data from specific data fields such as amounts, addresses, and dates. There is no inventive concept in CET s use of a generic scanner and computer to perform wellunderstood, routine, and conventional activities commonly used in industry. See Alice, 134 S.Ct. at At most, CET s claims attempt to limit the abstract idea of recognizing and storing information from hard copy documents using a scanner and a computer to a particular technological environment. Such a limitation has been held insufficient to save a claim in this context. See CET, 2014 WL , at *4. Here, the Challenged Claims are also nothing more than an abstract idea, in some cases also accompanied by the recitation of generic computer elements. a. Claim 1 Independent Claim 1 simply recites taking information (the unitary data stream ) and sending some of it to one place (a first network component ), and some of it to another place (a second network component ). It recites no additional features supplying an inventive concept beyond the underlying abstract idea already discussed. Simply repeating the abstract idea twice sending some of the information to one place, then sending some of it to a second place is not 39

49 inventive. Cyberfone (discussed above, see Section VII.C.1, supra) is instructive. The claims at issue in Cyberfone recited a method for obtaining data, exploding the data, i.e., separating it into component parts, and sending those parts to different destinations. Cyberfone, 558 F. App x at The Federal Circuit concluded that the idea of collecting information... then separating and transmitting that information according to its classification, is an abstract idea that is not patent-eligible. Id. at 992 (emphasis added). This is essentially what Claim 1 does. Though it specifies a digital device and network component[s], this is not a patent-eligible concept. The digital device and network components recited by Claim 1 are precisely the kind of wholly generic computer implementation that the Supreme Court warned in Alice and Mayo will not confer patent eligibility. See Alice, 134 S. Ct. at 2358; see also Mayo, 132 S. Ct. at Again, Cyberfone is instructive. There, the patentee argued that its method claims for obtaining data,... separating it into component parts, and sending those parts to different destinations were sufficiently limited because they require[d] a telephone, and that the recited telephone was a specific machine that play[ed] an integral role in the method. Cyberfone, 558 F.3d at 992. The Federal Circuit disagreed and held the claimed method patent-ineligible, noting that a generic telephone is not a specific machine, and adds nothing of significance to the 40

50 claimed abstract idea. Id. at 992. Exactly the same can be said of Claim 1 s digital device and network component[s]. Reciting that information is transmitted between networked components adds no inventive concept, because it merely attempt[s] to limit the use of the abstract idea to a particular technological environment. Ultramercial, 772 F.3d at 716 (internal quotations omitted). Claim 1 is also similar to the claims found patent-ineligible in Dealertrack v. Huber (discussed above), which recited A computer aided method... the method comprising and listed the steps of the method. Dealertrack, 674 F.3d at The patentee in Dealertrack argued that the computer-aided preamble sufficiently limit[ed] the claimed method, but the Federal Circuit disagreed, noting that the computer aided language d[id] not specify how the computer hardware... [was] specially programmed to perform the steps claimed in the patent. Id. (emphasis added). Similarly here, Claim 1 does not explain specifically how (if at all) the generic computer implementation recited in Claim 1 is used to perform the recited process steps. Moreover, the digital device and network component[s] in Claim 1 are even more generic than the computer recited in the Dealertrack claims. Claim 1 thus fails step two of the Mayo-Alice framework. Claim 1 also fails the machine-or-transformation test. It fails the machine prong of the test because Claim 1 plainly does not require the method to be 41

51 performed by a particular machine, or even a machine at all. See CyberSource, 654 F.3d at Claim 1 can be carried out by a person on pen and paper. It fails the transformation prong of the test because [t]he mere collection and organization of data which is all Claim 1 does is insufficient to meet the transformation prong of the test. CyberSource, 654 F.3d at 1370, 1375; Cyberfone, 558 F. App x at 993; see also Ultramercial, 772 F.3d at 717. b. Claim 6 Claim 6 fails to supply an inventive concept for substantially the same reasons described above for its independent claim, Claim 1. Claim 6 further specifies that the the digital device is a server responsive to specialized software. However, the recited server is still precisely the kind of wholly generic computer implementation that the Supreme Court warned in Alice and Mayo will not confer patent eligibility. See Alice, 134 S. Ct. at 2358; see also Mayo, 132 S. Ct. at Reciting unspecified specialized software does not render this claim patent-eligible. Patent Owner ICS has admitted, [l]ike any common computer, the server... would be unable to function without computer software. Ex at 11 (emphasis added). In other words, the specialized software is simply an inherent feature of the wholly generic server. Moreover, that the specialized software is recited generically (without any detail on what it is or how it 42

52 functions) is likewise fatal, as confirmed by Dealertrack, Inc. v. Huber, 674 F.3d 1315 (Fed. Cir. 2012). In Dealertrack the Federal Circuit assessed the 101 patent eligibility of a claim that recited A computer aided method... the method comprising and listed the steps of the method. Deaelertrack, 674 F.3d at The patentee argued that the computer-aided preamble sufficiently limit[ed] the claims to an application of the [abstract] idea. Id. at The Federal Circuit disagreed, noting that the computer aided language does not specify how the computer hardware... [was] specially programmed to perform the steps claimed in the patent. Id. Similarly here, Claim 6 recites that the server operates on specialized software, but does not specify what that specialized software is, or how the server uses it to perform the recited process steps. Claim 6 thus fails step two of the Mayo-Alice framework. In addition, Claim 6 is unlike the claims at issue in the Federal Circuit s recent decision in DDR Holdings, LLC v. Hotels.com, L.P., , 2014 WL , at *10 (Fed. Cir. Dec. 5, 2014) (Ex. 1019). Those claims, in the court s view, covered a solution necessarily rooted in computer technology to a problem specifically arising in the realm of computer networks WL , at *10. In contrast, the alleged problems the 020 Patent seeks to solve are generic business problems faced by any business that relies on paper forms. See Section VI.B.2.a. They are not technical problems, let alone problems specifically arising 43

53 in the realm of computer networks like in DDR Holdings. See id. Nor is Claim 6 s solution necessarily rooted in computer technology. Id. No computer technology is needed for the claimed solution, as is evident from the fact that the process carried out by Claim 6 s server is also recited as a pure method in Claim 50. Moreover, the claims in DDR Holdings achieved their aims by departing from the conventional functioning of Internet... protocol. Id. Claim 42, in contrast, clearly relies on the conventional functioning of computer technology; there is nothing in the claim suggesting the server or its specialized software do anything but conventional things that computers and software do. Claim 6 also fails the machine-or-transformation test because, although it recites a machine a generic server this does not impose meaningful limits on the claim s scope. See Bilski, 545 F.3d at 961. [F]or the addition of a machine to impose a meaningful limit on the scope of a claim, it must play a significant part in permitting the claimed method to be performed, rather than function solely as an obvious mechanism for permitting a solution to be achieved more quickly, i.e., through the utilization of a computer. SiRF Tech., Inc. v. Int l Trade Comm n, 601 F.3d 1319, 1333 (Fed. Cir. 2010); see also CyberSource, 654 F.3d at 1375 ( [T]he basic character of a process claim drawn to an abstract idea is not changed by claiming only its performance by computers ). Here, Claim 6 does exactly that: it recites a perfunctory and obvious computer mechanism a generic 44

54 server for completing a recited process. Again, note that the server of Claim 6 performs exactly the same method that Claim 50 recites without the server. But the Federal Circuit has indicated that if a method... can be performed without a machine, a claim to a machine performing that method will not satisfy the machine prong of the machine-or-transformation test. See SiRF Tech., 601 F.3d at Thus, Claim 6 s server does not play a significant part in permitting the claimed method to be performed, see id., and it therefore fails the machine prong of the machine-or-transformation test. Claim 6 also fails the transformation prong of the test because [t]he mere collection and organization of data which is all Claim 6 does is insufficient to meet the transformation prong of the test. CyberSource, 654 F.3d at 1370, 1375; Cyberfone, 558 F. App x at 993; see also Ultramercial, 772 F.3d at 717; CET, 2014 WL , at *4. c. Claim 8 Claim 8 fails to supply an inventive concept for substantially the same reasons described above for its independent claim, claim 1. Though Claim 8 specifies that the unitary data stream comprises an insurance claim form, this merely narrows the abstract idea to a particular field of use, namely to insurance claims forms. But limiting an abstract idea to one field of use does not make it patent-eligible. Kappos, 561 U.S. at 612; see also Parker v. Flook, 437 U.S. 584, 590 (1978) ( [T]he Pythagorean theorem would not have been patentable, or 45

55 partially patentable, because a patent application contained a final step indicating that the formula... could be usefully applied to existing surveying techniques. ). Claim 8 also fails the machine-or-transformation test for substantially the same reasons described above for Claim 1. It adds no machine to what is recited in Claim 1, nor does it add any steps to the recited process let alone steps that would transform[] a particular article into a different state or thing See Bilski, 545 F.3d at 954; see also CET, 2014 WL , at *4. d. Claim 9 Claim 9 fails to supply an inventive concept for substantially the same reasons described above for its independent claim, Claim 1. Though Claim 9 specifies that wherein N 1 of the N fields contain text data and the Nth one of the N fields contains a digital attachment, this merely narrows the abstract idea to a particular field of use, namely to a particular type of incoming data. But limiting an abstract idea to one field of use does not make it patent-eligible. Kappos, 561 U.S. at 612; see also Parker v. Flook, 437 U.S. 584, 590 (1978) ( [T]he Pythagorean theorem would not have been patentable, or partially patentable, because a patent application contained a final step indicating that the formula... could be usefully applied to existing surveying techniques. ). Claim 9 also fails the machine-or-transformation test for substantially the same reasons described above for Claim 1. It adds no machine to what is recited in 46

56 Claim 1, nor does it add any steps to the recited process let alone steps that would transform[] a particular article into a different state or thing. See Bilski, 545 F.3d at 954; see also CET, 2014 WL , *4. e. Claim 12 Claim 12 fails to supply an inventive concept for substantially the same reasons described above for its independent claim, Claim 1. Though Claim 12 specifies that one of the first and second networked components is a mainframe computer, this added language is, at best, just a token postsolution component[] (Kappos, 561 U.S. at ) and precisely the kind of recitation of a generic computer [that] cannot transform a patent-ineligible abstract idea into a patenteligible invention (Alice, 134 S. Ct. at 2358). Claim 12 also fails the machine-or-transformation test for substantially the same reasons described above for Claim 1. The added recitation of a mainframe computer in Claim 12 does not change this. Though a mainframe computer is a machine, it clearly does not play a significant part in permitting the claimed method to be performed (CyberSource, 654 F.3d at 1375) because the mainframe is still just a passive endpoint a destination where data is routed. The mainframe and the networked component that comprise it don t actually do anything in the claimed method. Claim 12 therefore fails the machine prong of the machine-or-transformation test. Claim 12 also fails the transformation prong 47

57 because it adds no steps to the method of Claim 12 let alone steps that would transform[] a particular article into a different state or thing. See Bilski, 545 F.3d at 954; see also CET, 2014 WL , *4. f. Claim 13 Claim 13 fails to supply an inventive concept for substantially the same reasons described above for Claim 12. Though Claim 13 specifies that the mainframe computer receives only ones [sic] of the N fields containing text data, this is a trivial refinement that adds no inventive concept. Indeed, this is little more than separating and transmitting... information according to its classification that the Federal Circuit held in Cyberfone was patent-ineligible. Cyberfone, 558 F. App x at 992. Claim 13 also fails the machine-or-transformation test for substantially the same reasons described above for Claim 12. It adds no machine to what is recited in Claim 12, nor does it add any steps to the recited process let alone steps that would transform[] a particular article into a different state or thing. See Bilski, 545 F.3d at 954; see also CET, 2014 WL , at *4. g. Claim 15 Claim 15 is nearly the same as Claim 1 and fails to supply an inventive concept for substantially the same reasons described above for Claim 1. The only difference is that in Claim 15, the N fields are arranged in a predetermined order, 48

58 and whether each field is sent to a first network component and/or a second network component is determined by [its] position in [the] predetermined order rather than in response to... field labels. However, this is still no different than the claims at issue in Cyberfone, which recited a method for obtaining data, exploding the data, i.e., separating it into component parts, and sending those parts to different destinations, Cyberfone, 558 F. App x at , and which the Federal Circuit held were not patent-ineligible. Claim 15 also fails the machine-or-transformation test for substantially the same reasons described above for Claim 1. It adds no machine to what is recited in Claim 1, nor does it add any steps to the recited process let alone steps that would transform[] a particular article into a different state or thing. See Bilski, 545 F.3d at 954; see also CET, 2014 WL , at *4. h. Claim 20 Claim 20 fails to supply an inventive concept for substantially the same reasons described above for its independent claim, Claim 15. Claim 20 further specifies that the the digital device is a server responsive to specialized software. However, as explained for Claim 6, (which recites the identical limitation) this is still precisely the kind of wholly generic computer implementation that the Supreme Court warned in Alice and Mayo will not confer patent eligibility. See Alice, 134 S. Ct. at 2358; see also Mayo, 132 S. Ct. at That Claim 20 also 49

59 recites unspecified specialized software will not save it, as confirmed by ICS s admission that [l]ike any common computer, the server... would be unable to function without computer software (Ex at 11), as well as the fact that the specialized software is recited generically (without any detail on what it is or how it functions). See Dealertrack, 674 F.3d at 1333 (fact that computer aided language does not specify how the computer hardware... [was] specially programmed to perform the steps claimed in the patent rendered claim patentineligible under 101). Claim 20 also fails the machine-or-transformation test because, although it recites a machine (a generic server ), this does not impose meaningful limits on the claim s scope. See Bilski, 545 F.3d at 961. [F]or the addition of a machine to impose a meaningful limit on the scope of a claim, it must play a significant part in permitting the claimed method to be performed, rather than function solely as an obvious mechanism for permitting a solution to be achieved more quickly, i.e., through the utilization of a computer. SiRF Tech., Inc. v. Int l Trade Comm n, 601 F.3d 1319, 1333 (Fed. Cir. 2010); see also CyberSource, 654 F.3d at 1375 ( [T]he basic character of a process claim drawn to an abstract idea is not changed by claiming only its performance by computers. ). Here, Claim 20 does exactly that: it recites a perfunctory and obvious computer mechanism a generic server for completing a recited process. Again, note that the server of Claim 50

60 42 performs exactly the same method that Claim 50 recites without the server. But the Federal Circuit has indicated that if a method... can be performed without a machine, a claim to a machine performing that method will not satisfy the machine prong of the machine-or-transformation test. See SiRF Tech., 601 F.3d at Thus, Claim 20 s server does not play a significant part in permitting the claimed method to be performed, see id., and it therefore fails the machine prong of the machine-or-transformation test. Claim 20 also fails the transformation prong of the test because [t]he mere collection and organization of data which is all Claim 20 does is insufficient to meet the transformation prong of the test. CyberSource, 654 F.3d at 1370, 1375; Cyberfone, 558 F. App x at 993; see also Ultramercial, 772 F.3d at 717; CET, 2014 WL at *4. i. Claim 21 Claim 21 fails to supply an inventive concept for substantially the same reasons described above for its independent claim, Claim 15. Though Claim 21 specifies that the unitary data stream comprises an insurance claim form, this merely narrows the abstract idea to a particular field of use, namely to insurance claims forms. But limiting an abstract idea to one field of use does not make it patent-eligible. Kappos, 561 U.S. at 612; see also Parker v. Flook, 437 U.S. 584, 590 (1978) ( [T]he Pythagorean theorem would not have been patentable, or 51

61 partially patentable, because a patent application contained a final step indicating that the formula... could be usefully applied to existing surveying techniques. ). Claim 21 also fails the machine-or-transformation test for substantially the same reasons described above for Claim 15. It adds no machine to what is recited in claim 15, nor does it add any steps to the recited process let alone steps that would transform[] a particular article into a different state or thing. See Bilski, 545 F.3d at 954; see also CET, 2014 WL , at *4. j. Claim 24 Claim 24 fails to supply an inventive concept for substantially the same reasons described above for its independent claim, claim 15. Though Claim 24 specifies that one of the first and second networked components is a mainframe computer, this added language is (as explained above for Claim 12) just a token postsolution component[] (Kappos, 561 U.S. at ) and precisely the kind of recitation of a generic computer [that] cannot transform a patent-ineligible abstract idea into a patent-eligible invention (Alice, 134 S. Ct. at 2358). Claim 24 also fails the machine-or-transformation test for substantially the same reasons described above for Claim 15. The added recitation of a mainframe computer in Claim 24 does not change this. Though a mainframe computer is a machine, it clearly does not play a significant part in permitting the claimed method to be performed (CyberSource, 654 F.3d at 1375) because the mainframe 52

62 is still just a passive endpoint a destination where data is routed. The mainframe and the networked component that comprise it don t actually do anything in the claimed method. Claim 24 therefore fails the machine prong of the machine-or-transformation test. Claim 24 also fails the transformation prong because it adds no steps to the method of Claim 15 let alone steps that would transform[] a particular article into a different state or thing (Bilski, 545 F.3d at 954). k. Claim 25 Claim 25 fails to supply an inventive concept for substantially the same reasons described above for Claim 24. Though Claim 25 specifies that the mainframe computer receives only ones [sic] of the N fields containing text data, this is a trivial refinement that adds no inventive concept (as explained for Claim 13, which recites the same limitation). Indeed, this is little more than separating and transmitting... information according to its classification that the Federal Circuit held in Cyberfone was patent-ineligible. Cyberfone, 558 F. App x at 992. Claim 25 also fails the machine-or-transformation test for substantially the same reasons described above for Claim 24. It adds no machine to what is recited in Claim 24, nor does it add any steps to the recited process let alone steps that would transform[] a particular article into a different state or thing. See Bilski, 545 F.3d at 954; see also CET, 2014 WL , at *4. 53

63 C. Ground 2: Challenged Claims 1, 6, 9, 15, and 20 Are Anticipated by U.S. Patent No. 5,258,855 ( Lech ), Rendering Them Unpatentable Under 35 U.S.C U.S. Patent No. 5,258,855 ( Lech ) discloses all elements of Challenged Claims 1, 6, 9, 15, and 20. It therefore anticipates these claims, rendering them unpatentable under 35 U.S.C Overview of Lech Lech, entitled Information Processing Methodology, discloses methods and apparatuses for electronically extracting and processing data received from hard copy documents in a way that minimizes the need to manually process hard copy documents. Ex at 1:5 10. In general, the systems and methods of Lech allow[] a user to select specific portions of information extracted from a diversity of hard copy documents and... direct portions of this information to several different users in accordance with the needs of the particular user. Id. at 2:14 18; Bysinger Decl. 49. In an exemplary embodiment, a hard copy document such as a bill is fed into an automated digitizing unit such as a conventional scanner. Bysinger Decl. 51; Ex at 15:58 60, 5:59 65, 4:53 61, Fig. 1. The scanner stores in memory both (1) an actual image of the hard copy document and (2) textual information extracted off the document. Bysinger Decl. 51; Ex at 5:66 68, 4:26 27, 7: The document image, the extracted textual information, or both are then sent to a computer. Bysinger Decl. 51; Ex. 54

64 1009 at 5:1 2. The computer then pars[es] information extracted from the hard copy document and... direct[s] this parsed information to specific users or application programs as an input file. Ex at 4:45-49; id. at 5:25 29, 9:27 30, 10: The extraction and parsing of information can happen either automatically in accordance with predefined content instructions (for example, templates which specify the location of information on the hard copy document) or interactively with user input. Id. at 2:60 3:25, 8:68 9:2, 13:67 14:10; Bysinger Decl. 53. These application programs to which the input files are sent can be, for example, specific departments within a company, such as the accounting department or mailroom, and each department has its own application program which utilizes information in the input files. Bysinger Decl. 51; Ex at 1:34 44, 13:57 64, 13:67 14:10. Thus, as an example, three separate departments within a company may require information from a hard copy bill. The accounting department may need financial information such as the vendor name, account number, statement date, and amount due; the second and third departments may require only mail-to information and previous balance information. Bysinger Decl. 52; Ex at 13: The systems and methods of Lech extract information off the received hard copy bill, parse the extracted information, generate input files comprising the specific information needed by each department, and electronically transmit those input files to the appropriate destination, i.e., to applications 55

65 programs within each department. The Federal Circuit in CET confirmed that these disclosures were insufficient to render any of the claims in Lech patenteligible under Lech Is Prior Art and Eligible for Use in CBMR. The earliest application to which the 020 Patent could theoretically claim priority is provisional application No. 60/014,427 ( the 427 Provisional Application ), filed March 28, Ex Lech issued November 2, 1993, more than two years earlier. Ex It is thus prior art to the 020 Patent under pre-aia 35 U.S.C. 102(b) and meets the requirements of AIA 18(a)(1)(C) for two independent reasons: (1) it clearly is described by section 102(a) of pre-aia 35 U.S.C., in accordance with AIA 18(a)(1)(C)(i); and (2) it issued more than 1 year before the date of the application for the 020 Patent, in accordance with AIA 18(a)(1)(C)(i). 3. Lech Anticipates Claim 1. The preamble of Claim 1 is not limiting. See Section IV.C, supra. Nevertheless, Lech discloses a digital device operatively coupled to a computer network (Claim 1 preamble). A computer is a digital device. Bysinger Decl. 4 Petitioners do not concede that the 020 Patent is in fact entitled to claim priority to the 427 Application. 56

66 60. The computer 230 in Lech is operatively coupled to a computer network, as shown in Fig. 1. A person of skill in the art would know that the computer is coupled to a computer network, as Fig. 1 shows the computer connected to other components, and the connection 240 can be any routing or connecting link, implemented in hardware or software or both. Ex at Fig. 1, 5:25 32; Bysinger Decl. 60. Lech discloses a sophisticated computer network. Ex at 1: Lech discloses operatively coupling the digital device to a first network component (e.g., Application Unit 270-1) and operatively coupling the digital device to a second network component (Application Unit 270 N). Lech discloses 57

67 operatively coupled to first and second networked components, e.g., to multiple computer application units to 270-N, as shown in Fig. 1. The computer application units to 270-N are networked components because they can be connected to computer 230 through any routing or connecting link, implemented in hardware or software or both, including on a sophisticated computer network. Ex at 5:29 32, 1:34 35; Bysinger Decl. 61. Lech also discloses the digital device receiving a unitary data stream, e.g., data from a hard copy document 100 such as a bill from XYZ Corporation to customer ABC Corporation, comprising a set of N fields each field having a respective Nth field label. Each hard copy document contains multiple fields of data, as illustrated in Fig. 2. Ex at 5: Patent Owner ICS has conceded that fields can be boxes on an insurance claim form. Ex at 47. Lech Fig. 2 illustrates an example of a hard copy document 100 which contains information to be processed by the instant invention (id.) and shows at least thirteen fields of data in boxes on 58

68 a paper form (highlighted in yellow). Each field has a corresponding field label (highlighted in green). The exemplary hard copy document 100 of Fig. 2 is preferably scanned in and fields of information on it are recognized using standard optical character recognition software. Bysinger Decl ; Ex at 5:66 6:8. Both the scanned image of the document as well as the textual fields of information are then sent to a computer 230, so the digital device receives the information. Bysinger Decl. 64; Ex at 6: Lech discloses transferring the contents of a first subset of the N fields to the first network component and transferring the contents of a second subset of the N fields to the second network component in response to the N field labels included in the unitary data stream e.g., parsing information extracted from the hard copy document and... directing this parsed information to specific users or application programs as an input file. Ex at 4: Lech Fig. 11 lists data corresponding to the hard copy document of FIG. 2, and includes each variable name, or field name. Id. at 3: [C]ontent instructions... parse the information shown in FIG. 11 to various 59

69 application programs.... Id. at 14:7 10. In an exemplary embodiment, three separate departments of ABC Corporation require information from the XYZ Corporation bill. The first department requires vendor, account number... and new balance information. Id. at 13: These are variable names, or field labels, included in the hard copy bill, so the information is transmitted in response to field labels. The second and third departments require mail to information and previous balance information, which are also field labels. Id. at 13: The parsed information to be transmitted to each of the three departments is illustrated in Fig. 12A (first department), 12B (second department), and 12C (third department). Id. at 14:3 7. The parsed information from the hard copy document is then transmitted to a selected computer application unit. Id. at 9: Lech also discloses that N (the number of fields of data) is a positive integer greater than 1, the first and second subsets are not both equal to the full set N, and the first and second subsets each contain at least one member. In the example of XYZ Corporation s bill in Figures 60

70 2 and 11, N is at least thirteen because there are at thirteen fields of data. Turning to Figure 12, ten fields of data are directed to the first department (Fig. 12A), and two fields of data are directed to the second and third departments (Figs. 12B and 12C). Neither of these subsets is equal to the full thirteen fields of data included in the original document. Furthermore, each subset of information that is sent to the departments contains at least one field, or member. 4. Lech Anticipates Claims 6 and 20. Claims 6 and 20 are substantively the same, and each adds the same element to Claims 1 and 15 respectively. Lech discloses all elements of Claims 1 and 15, as discussed in sections VII.C.3. (above) and VII.C.6. (below) and incorporated herein by reference. Lech discloses that the digital device is a server responsive to specialized software, e.g., interface 200, which includes a computer 230 as shown in Lech Fig. 1. Id. at 5:1 2. The computer 230 in the interface... receive[s] from an applications program... content instructions. Id. at 3:26-28; see also id. at 5:8-11 ( The computer 230 is used to select portions of the stored document information contained in memory in accordance with content instructions which define portions of the stored document information required by an application unit. ). The computer 230 then serves responses to the application units, based on the requested information ( Portions of the stored document information are selected in accordance with content instructions which define 61

71 portions of the stored document information required by a particular application unit. ). A person of skill in the art would know that based on this functionality, computer 230 is considered a server. Bysinger Decl. at Lech further discloses that the alleged invention includes... software necessary to extract, retrieve, and process information from the hard copy document. Ex at 4: And as Patent Owner ICS admits [l]ike any common computer, the server, personal computers and mainframe computer would be unable to function without computer software (Ex at 11), and all software is specialized, e.g., to perform its intended task. Bysinger Decl. 71. Thus, Lech discloses the digital device is a server responsive to specialized software. 5. Lech Anticipates Claim 9. Lech discloses the digital device as recited in claim 1, wherein N 1 of the N fields contain text data (e.g., textual data from the hard copy document) and the Nth one of the N fields contains a digital attachment (e.g., the digitized image of the hard copy document). As discussed above in section VII.C.3., and incorporated herein by reference, Lech discloses all elements of Claim 1. Additionally, Lech teaches that after scanning a document, the extracted data is stored in two forms: [t]he actual image of the hard copy document 100 is stored as image information in the scanner memory 220. In addition, the scanner memory 220 stores textual information 62

72 recognized on the hard copy document 100 by, for example, employing standard character recognition software. Ex at 6:2-7. The information is then transmitted to computer 230, comprising the unitary stream received by the digitized device. Id. at 5:1-2. As discussed above, Fig. 2 shows that the fields on the hard copy documents are labelled with field names, and that they contain text data. For example, the first field in the document is labelled Customer and contains the text data ABC Corporation 123 Sixteenth Street Hometown, NJ Id. at Fig. 2. The image of the document is a digitized image of the actual appearance of hard copy document 100, and therefore is considered an attachment. Id. at 7: Lech also shows that the document image received by the computer is recognized as a field. For example, Claim 27 in Lech discloses the step of receiving output representing a diversity of types of hard copy documents... and storing information... into a memory as stored document information.... Ex. 63