Internet Advertising Claims Deemed Not Eligible for Covered Business Method Patent Review

by | Mar 13, 2017 | CBMs, Claim Construction

By Vishal Khatri and Carl Kukkonen

In a decision dated February 27, 2017, the Board denied institution of Google Inc.’s petition for Covered Business Method Patent Review of claims 20, 21, 23–26, 28, and 29 of U.S. Patent No. 6,128,651 (“the ’651 patent”) owned by KlausTech Inc. Google Inc. v. KlausTech Inc., CBM2016-00096 (Paper 10) (PTAB February 27, 2017).  Specifically, the Board relied on the Federal Circuit’s recent guidance in Unwired Planet, LLC v. Google Inc., 841 F.3d 1376 (Fed. Cir. 2016), and concluded that the petitioner had “not demonstrated that at least one challenged claim of the ’651 patent is directed to a method or apparatus for performing data processing or other operations used in the practice, administration, or management of a financial product or service.”

In Unwired Planet, the Federal Circuit explained that claims that were merely broad enough to cover potential sales from advertising, without something more, did not qualify the patent as a covered business method patent eligible for review.  The Court indicated that “[a]ll patents, at some level, relate to the potential sale of a good or service” and that “[i]t is not enough that a sale has occurred or may occur, or even that the specification speculates such a potential sale might occur.”  Unwired Planet, 841 F.3d at 1382.  Rather, the claim needs to be directed to “performing data processing or other operations” or “used in the practice, administration, or management of a financial product or service,” as required by the statute.”  Id., citing AIA § 18(d); 37 C.F.R. § 42.301(a).

The Board identified claim 20 of the ’651 patent as being representative and found that the claim applied to Internet advertising.  Claim 20 recites:

20. A non-scrolling ad display from a website for causing a browser hitting the website to undertake centrally controlled and recorded ad display for guaranteed minimum timed intervals comprising the steps of:

providing a website at a webserver for transmitting at least one page with a non-scrolling ad frame to a browser;

providing ad content for the non-scrolling ad frame, each ad content having ad identity and an individual timer for timing out commencing with display at the browser and an Internet address for fetching by the browser;

providing a central controller interrogating for browser identity and maintaining records associated with the browser identity indicating ad identity displayed, and timer timeout;

placing the ad content in the non-scrolling ad frame of the browser to display the ad content and start the individual timer;

timing out the individual timer of the ad content at the non-scrolling frame at the browser;

reporting from the browser to the central controller the timer timeout of the ad content;

retaining in the central controller a record of the browser identity, the ad identity, and the timer timeout of the ad content at the browser; and

transmitting to the reporting browser an Internet address for new ad content for placement in the non-scrolling ad frame in response to receipt of the timer timeout report at the central controller.

However, the Board indicated that claims merely applying to the facilitation of advertising were not enough to justify concluding that the patent is a covered business method patent eligible for review.  According to the Board, although the specification contained examples supporting that the claims were directed to a covered business method, the petitioner did not explain how those examples limited the scope of the claim.  The challenged claims did not include any language or limitations that were financial in nature and, according to the Board, the petitioner did not propose any claim constructions that were financial in nature and would warrant a different conclusion.

Takeaway

This decision suggests it may be more difficult for petitioners to obtain institution of covered business method patent reviews and provides some guidelines for patent owners to draft claims to avoid such reviews.  Petitioners should also consider advancing claim constructions in their requests that specifically define the challenged claims as financial in nature and directed to a financial product or service.

 

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Carl Kukkonen

Partner at Jones Day
An acknowledged leader in the profession, Carl Kukkonen has nearly 20 years of experience in strategic intellectual property counseling. He advises clients on patent infringement and validity, preparation and prosecution of patent applications, and brand protection matters.