PTAB

CBM2017-00037

CLoud9 Technologies LLC v. IPC Systems Inc

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Key Events
Petition
petition

1. Case Identification

2. Patent Overview

  • Title: Software Based Trading Turret
  • Brief Description: The ’566 patent discloses a communications system for providing a software-based trading turret. The system uses a turret switching system that communicates over a first network to a web server and turret devices, and over a second network to a remote client device that controls line switching via a graphical interface.

3. Grounds for Unpatentability

Ground 1: Patent Ineligibility under 35 U.S.C. §101 - Claims 1, 5-7, 11-13, and 17-18 are directed to an abstract idea.

  • Core Argument for this Ground:
    • Alice Step 1 (Abstract Idea): Petitioner argued the claims are directed to the abstract idea of communicating between multiple devices over a network using a switch. This concept, Petitioner asserted, is a long-standing human activity analogous to the function of manual telephone switchboard operators. The patent claims merely automate this fundamental practice using generic components like computers, networks, and servers. The patent specification itself acknowledges that the claimed "turret device" and "turret switching device" are conventional components utilized in the financial industry prior to the invention.
    • Alice Step 2 (No Inventive Concept): Petitioner contended the claims lack an inventive concept sufficient to transform the abstract idea into a patent-eligible application. The claims recite only a collection of generic computer components (web server, client device, networks) performing their conventional functions. Implementing a long-known practice on a general-purpose computer does not constitute "significantly more" than the abstract idea itself. The dependent claims were argued to add nothing inventive, merely confining the system to conventional IP networks or specifying that switching occurs in the switch.

Ground 2: Obviousness over Greene and SIP - Claims 1, 5-7, 11-13, and 17-18 are obvious over Greene in view of SIP.

  • Prior Art Relied Upon: Greene (Patent 6,212,177) and SIP (RFC-3261).
  • Core Argument for this Ground:
    • Prior Art Mapping: Petitioner asserted that Greene discloses a remote access system for a trader turret that includes nearly all claimed elements: an office switching network (turret switching system), trader turrets (turret device), a web server, a remote personal computer (client device), and communication over a public network like the Internet. Greene teaches a remote user can view line status on a PC and click to place or receive calls. Petitioner argued the only element not explicitly taught is the use of a specific "predetermined message" sent from the client device to the switching system to seize a line.
    • Motivation to Combine: A person of ordinary skill in the art (POSITA), seeking to implement the voice communication functionality described in Greene over the internet, would have been motivated to use a known, standardized VoIP signaling protocol. SIP was a mature and predominant protocol for establishing and controlling voice calls over IP networks at the time. The ’566 patent itself acknowledges SIP as prior art. Therefore, a POSITA would logically turn to SIP to provide the signaling needed for Greene's system.
    • Expectation of Success: A POSITA would have a high expectation of success in combining SIP with Greene. Integrating a standard protocol like SIP to handle call setup in Greene's IP-based communication system would have been a predictable implementation, as it involves using the protocol for its intended and well-understood purpose.

Ground 3: Obviousness over Greene, Kammerer, and SIP - Claims 1, 5-7, 11-13, and 17-18 are obvious over Greene in view of Kammerer and SIP.

  • Prior Art Relied Upon: Greene (Patent 6,212,177), Kammerer (Application # 2004/0205175), and SIP (RFC-3261).
  • Core Argument for this Ground:
    • Prior Art Mapping: This ground builds on the Greene reference by adding Kammerer. Petitioner argued Kammerer, which discloses an instant messaging and communication system for financial trading networks, explicitly teaches using SIP to send messages (e.g., a SIP INVITE) to initiate communication sessions. Kammerer describes showing user presence and interactivity, features that enhance a system like Greene.
    • Motivation to Combine: Kammerer provides an explicit motivation to combine its teachings with a system like Greene. Kammerer discusses the deficiencies of prior art systems that only show whether traders are active (as in Greene) and proposes its interactive, SIP-based system as a solution. A POSITA would be motivated to incorporate Kammerer’s use of SIP into Greene's turret system to improve interactivity and provide a robust messaging format for controlling lines.
    • Expectation of Success: Combining the references would yield predictable results. A POSITA could readily implement the SIP messaging taught by Kammerer within the network architecture of Greene to provide the claimed "predetermined message" for seizing a line, with a high expectation of success.
  • Additional Grounds: Petitioner asserted additional challenges under 35 U.S.C. §112, alleging a lack of written description for the term "a predetermined message" and indefiniteness for the term "turret switching device."

4. Key Claim Construction Positions

  • "predetermined message": Petitioner stated that, for the purpose of the petition, it would adopt the Patent Owner's proposed construction from co-pending litigation: "a message containing information identifying particular turret resources and functionality available on the turret to be performed... that is delivered in a communication protocol understood by the turret switching system." Petitioner argued that a standard SIP INVITE message, as taught by the prior art, meets this construction.

5. Arguments Regarding CBM Eligibility

  • Petitioner argued the ’566 patent is eligible for Covered Business Method (CBM) patent review because its claims are directed to a method and apparatus for performing data processing operations used in the practice and management of a financial product or service, namely a trading turret system for the financial industry.
  • Petitioner further contended that the patent does not fall under the exception for "technological inventions." The argument was that the claims do not recite a novel and unobvious technological feature but instead combine generic and conventional components (computers, networks, software) to automate a known business practice (connecting traders via a switch).

6. Relief Requested

  • Petitioner requested institution of a CBM review and cancellation of claims 1, 5-7, 11-13, and 17-18 of the ’566 patent as unpatentable.