Federal Reserve Bank Of Atlanta v. Bozeman Financial LLC

1. Case Identification

• Case #: CBM2017-00035
• Patent #: 6,754,640
• Filed: January 31, 2017
• Petitioner(s): Federal Reserve Bank of Atlanta, Federal Reserve Bank of Boston, Federal Reserve Bank of Chicago, Federal Reserve Bank of Cleveland, Federal Reserve Bank of Dallas, Federal Reserve Bank of Kansas City, Federal Reserve Bank of Minneapolis, Federal Reserve Bank of New York, Federal Reserve Bank of Philadelphia, Federal Reserve Bank of Richmond, Federal Reserve Bank of San Francisco, and Federal Reserve Bank of St. Louis
• Patent Owner(s): Bozeman Financial LLC
• Challenged Claims: 1-26

2. Patent Overview

• Title: Universal Positive Pay Match, Authentication, Authorization, Settlement and Clearing System
• Brief Description: The ’640 patent discloses a system and method for reducing check fraud by creating a "universal" positive pay system. The system allows all participants in the check clearing process (e.g., payers, payees, banks) to access a central database via the Internet to verify check register information at every point during clearing.

3. Grounds for Unpatentability

Ground 1: Indefiniteness of Claims 1-20, 25, and 26 under 35 U.S.C. § 112

• Core Argument for this Ground:
  • Lack of Algorithmic Structure: Petitioner argued that claims 1-20, 25, and 26 are invalid for indefiniteness because they recite numerous computer-implemented means-plus-function limitations without the specification disclosing the required corresponding algorithmic structure. The claims rely heavily on terms such as "first instruction means," "second instruction means," and up to a "fourteenth instruction means," as well as a "means for demodulating." Petitioner asserted that for computer-implemented functions, the specification must disclose more than a general-purpose computer; it must disclose an algorithm, or a step-by-step procedure, for performing the claimed function. The petition contended that the ’640 patent specification fails to provide any such algorithm for the recited functions. Instead, the specification was said to merely restate the functions themselves or describe them in high-level, user-centric terms (e.g., a customer can "fill out" a web form), which is insufficient to provide the definite structure required by § 112. This failure to link the claimed functions to any specific algorithm rendered the claims impermissibly broad and indefinite.

Ground 2: Unpatentable Subject Matter of Claims 1-6, 8-24, and 26 under 35 U.S.C. § 101

• Core Argument for this Ground:
  • Directed to an Abstract Idea: Petitioner argued that the claims are directed to the patent-ineligible abstract idea of collecting and analyzing information. Specifically, the claims recite the longstanding, fundamental economic practice of reconciling check information against a ledger to verify its authenticity. Petitioner asserted that these steps, such as storing check information, providing access to it, and comparing it against a presented check, are routine data processing steps that could be performed mentally or with pen and paper. The petition compared the claims to those in other cases found to be abstract by the Federal Circuit, which involved collecting, analyzing, and displaying data without improving computer functionality itself.
  • Lacks an Inventive Concept: Petitioner contended that the claims, when viewed as an ordered combination, lack an inventive concept sufficient to transform the abstract idea into a patent-eligible application. The claims merely added recitations of generic and conventional computer components—such as a server, a database, a data communications device, and a website—to implement the abstract idea. Petitioner argued that these elements were invoked merely as tools to perform their ordinary and well-known functions without providing any improvement to computer technology. The patent’s purported novelty of enabling access for all parties in the clearing process was described only in general, functional terms and did not represent a specific, technical solution to a technical problem. Therefore, the claims amounted to no more than an instruction to implement the abstract idea of check verification on a generic computer.

4. Key Claim Construction Positions

• "instruction means": Petitioner argued that the term "instruction means," used repeatedly throughout the claims for fourteen distinct functions, is a means-plus-function limitation subject to 35 U.S.C. § 112(6). The word "instruction" itself was argued to not impart any structure, as it is a generic reference to software. This construction was central to the indefiniteness argument, as Petitioner contended the specification failed to disclose the corresponding algorithmic structure for any of these "instruction means" limitations.
• "means for demodulating": In claim 9, Petitioner argued that "means for demodulating check register information from a telephone carrier signal" is also a means-plus-function limitation. The petition asserted that the specification provides no corresponding hardware or software structure for performing this function beyond a conclusory statement, making this limitation indefinite.

5. Arguments Regarding CBM Eligibility

• Petitioner argued that the ’640 patent was eligible for Covered Business Method (CBM) review. The claims were asserted to be directed to a method and apparatus for performing data processing operations used in the practice and management of a financial product or service—namely, check clearing and fraud prevention. Furthermore, Petitioner contended that the patent was not for a "technological invention" because it did not solve a technical problem with a technical solution. Instead, it addressed the business problem of check fraud using only conventional, generic computer technology without reciting any novel or non-obvious technological features.

6. Relief Requested

• Petitioner requested institution of a CBM review and cancellation of claims 1-20, 25, and 26 as indefinite under 35 U.S.C. § 112, and cancellation of claims 1-6, 8-24, and 26 as directed to unpatentable subject matter under 35 U.S.C. § 101.