PTAB

CBM2017-00019

DISH Network LLC v. Customedia Technology LLC

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Key Events
Petition
petition

1. Case Identification

2. Patent Overview

  • Title: System for Data Management and On-Demand Rental and Purchase of Digital Data Products
  • Brief Description: The ’437 patent describes a system, such as a digital set-top box, for processing and managing on-demand digital content. The system includes a non-removable storage device for recording rented data and features a mechanism for "enacting a simulated return" of the rented content by deleting or blocking access to it, and then notifying the data supplier of the return.

3. Grounds for Unpatentability

Ground 1: Patent-Ineligible Subject Matter - Claims 1, 9, 10, and 13-16 are unpatentable under 35 U.S.C. § 101.

  • Prior Art Relied Upon: Not applicable.
  • Core Argument for this Ground: Petitioner argued that the challenged claims are directed to the patent-ineligible abstract idea of renting and returning media content, a fundamental and long-standing commercial practice. The petition asserted that claim 1 merely recites the application of this abstract idea using generic, conventional computer components (e.g., receiver, memory, processor, user interface) without adding an inventive concept that transforms the claim into patent-eligible subject matter. Petitioner contended that the specification of the ’437 patent itself acknowledges that these hardware components were well-known in the art, and thus the claims do not represent an improvement to computer functionality itself but rather the use of computers to automate a known business practice.

Ground 2: Anticipation by Ginter - Claims 1, 9, 10, and 13-16 are anticipated by Ginter.

  • Prior Art Relied Upon: Ginter (WO 96/27155)
  • Core Argument for this Ground:
    • Prior Art Mapping: Petitioner asserted that Ginter discloses every limitation of the challenged claims. Ginter described a "virtual distribution environment" (VDE) comprising electronic appliances that perform the functions of the claimed system. Ginter’s appliance was alleged to meet the limitations of claim 1 by including: a receiver for a data feed, non-removable memory (a storage device "physically enclosed within a secure enclosure"), processing circuitry (CPUs), a user interface for controlling the system, and playback circuitry. Critically, Petitioner argued Ginter taught the "simulated return" and "notification" limitations through its use of "permission records" (PERCs), which can be configured to "prevent further usage after a rental has expired" (blocking access) and to provide notice to a content provider that a content modification or deletion has occurred.
    • Key Aspects: The anticipation argument hinged on interpreting Ginter’s PERC-based access control system as inherently teaching the "simulated return" and supplier notification features of claim 1.

Ground 3: Obviousness over Ginter and Stefik - Claims 1, 9, 10, and 13-16 are obvious over Ginter in view of Stefik.

  • Prior Art Relied Upon: Ginter (WO 96/27155) and Stefik (Patent 5,634,012)
  • Core Argument for this Ground:
    • Prior Art Mapping: Petitioner argued that Ginter provided a foundational system for distributing digital content to an electronic appliance. Stefik, in turn, disclosed a sophisticated digital rights management (DRM) system for controlling the use of digital works. Stefik’s system included a "loan" transaction where a digital work is temporarily transferred to a user's device (a "repository") and is automatically returned after a predetermined period. Petitioner contended that Stefik’s return mechanism, which involves deactivating copies and erasing the work from memory, explicitly taught the "simulated return" limitation. Furthermore, Stefik described that in a "loan" transaction, the server is updated upon the work's return to make it available to others, thereby teaching the "notifying a data supplier" limitation.
    • Motivation to Combine: A person of ordinary skill in the art (POSITA) would combine Ginter's distribution system with Stefik's advanced DRM features. The motivation would be to improve the control, flexibility, and monetization of the distributed digital content, as Stefik provided a robust and detailed framework for managing usage rights, fees, and limited-term access like rentals. Both references were in the same field of digital content distribution and addressed complementary aspects of the same problem.
    • Expectation of Success: A POSITA would have had a reasonable expectation of success in integrating Stefik's DRM repository concepts into Ginter's electronic appliances, as it would have been a predictable combination of a control system with a distribution platform.

4. Key Claim Construction Positions

  • "enacting a simulated return of said rented data [by deleting or scrambling said data...or blocking further access]": Petitioner proposed this term should be construed as "making said rented data inaccessible to the user of the storage device." This construction was based on language in the ’437 patent specification that equates "returning" data with erasing, scrambling, or blocking it after a rental period expires.
  • "notifying a data supplier of said simulated return": Petitioner argued for a broad interpretation including "communicating the simulated return of the rented data to the data product supplier," such as movie studios or distributors.
  • "a storage device built in to the system and which is not removable from the system": Petitioner adopted the construction used during prosecution, meaning "a storage device that is not removable from the system without rendering it inoperable."

5. Relief Requested

  • Petitioner requested institution of a Covered Business Method review and cancellation of claims 1, 9, 10, and 13-16 of the ’437 patent as unpatentable.