PTAB

CBM2015-00018

Apple Inc v. Smartflash LLC

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Key Events
Petition
petition Intelligence

1. Case Identification

2. Patent Overview

  • Title: Data Storage and Access Systems
  • Brief Description: The ’317 patent describes a method for controlling access to data based on payment. The method involves receiving a request for a data item, receiving payment data from the requester, transmitting the requested data, reading payment distribution information from a data store, and outputting the payment data to a payment system.

3. Grounds for Unpatentability

Ground 1: Unpatentable Under 35 U.S.C. §101 as Directed to an Abstract Idea - Claim 18

  • Prior Art Relied Upon: While not a prior art-based challenge under 35 U.S.C. §103, Petitioner cited numerous references to demonstrate that the concepts underlying claim 18 were well-known, routine, and conventional prior to the invention. Key references included Chernow (Patent 4,999,806), Mori (Patent 5,103,392), Stefik (Patents 5,530,235 and 5,629,980), von Faber (an 1997 IEEE article), and Ginter (Patent 5,915,019).
  • Core Argument for this Ground: Petitioner argued that claim 18 is unpatentable under §101 because it is directed to patent-ineligible subject matter. The argument followed the two-step framework established in Alice Corp. v. CLS Bank Int'l.
    • Alice Step 1 - Directed to an Abstract Idea: Petitioner asserted that claim 18 is directed to the abstract idea of "paying for data" or "paying for content." This was characterized as a fundamental, long-standing economic practice and a basic building block of commerce. The petition argued that the five steps recited in the claim—(1) receiving a request, (2) receiving payment data, (3) transmitting requested data, (4) reading payment distribution information, and (5) outputting payment data—merely describe the essential, rudimentary components of this abstract commercial concept. Petitioner contended these steps could be performed by a human, such as an artist selling a poem, further demonstrating their abstract nature.
    • Alice Step 2 - Lacks an Inventive Concept: Petitioner argued that the elements of claim 18, viewed individually and as an ordered combination, fail to transform the abstract idea into a patent-eligible application. The petition contended that the claim adds no "inventive concept" that is "significantly more" than the abstract idea itself. The references to a "data store" and a "payment system" were described as nothing more than generic, conventional computer components being used for their ordinary and well-known functions. The petition asserted that merely implementing a long-standing business practice on a general-purpose computer does not confer patent eligibility, as it does not improve the functioning of the computer itself or any other technology. The patent specification itself was cited as evidence that the "physical embodiment of the system is not critical."

4. Key Claim Construction Positions

  • Petitioner proposed a construction for the term "payment data" as being central to its §101 argument.
    • Proposed Construction: "data representing payment made for requested content data," which is distinct from "access control data."
    • Relevance: This construction was intended to frame the claim's subject matter as being squarely about the financial and commercial act of payment, reinforcing the argument that it is directed to a fundamental economic practice. By distinguishing "payment data" from technical "access control data," Petitioner sought to underscore the non-technical, business-method nature of the claim.

5. Key Technical Contentions (Beyond Claim Construction)

  • Claim 18 is Not a "Technological Invention": A central pillar of Petitioner's argument, both for establishing Covered Business Method (CBM) eligibility and for its §101 challenge, was that claim 18 does not cover a technological invention. Petitioner argued that the claim as a whole does not recite a technological feature that is novel and unobvious. Instead, it merely recites the use of known, conventional technologies (e.g., generic memory for a data store, standard e-payment systems) to accomplish a non-technical business process.
  • Claim 18 Solves a Business Problem, Not a Technical One: Petitioner contended that the problem the ’317 patent purports to solve is data piracy—a business problem related to lost revenue. The claimed solution, "binding the data access and payment together," was framed as a business or economic solution, not a technical one. The petition argued that an automated solution to a non-technical problem does not transform that problem or its solution into a patent-eligible technological invention.

6. Relief Requested

  • Petitioner requested the institution of a CBM patent review and the cancellation of claim 18 of the ’317 patent as unpatentable for being directed to ineligible subject matter under 35 U.S.C. § 101.