PTAB

CBM2018-00020

Miami Intl Holdings Inc v. FTen Inc

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Key Events
Petition
petition

1. Case Identification

2. Patent Overview

  • Title: Method and System For Cancelling Orders For Financial Articles of Trade
  • Brief Description: The ’371 patent describes a method and system for automatically cancelling pending financial orders. The system collects and normalizes real-time data from multiple liquidity destinations, identifies the occurrence of a predefined market event, and, in response, terminates communication sessions to trigger the cancellation of a trading entity’s pending orders.

3. Grounds for Unpatentability

Ground 1: Claims 1-30 are unpatentable under 35 U.S.C. §101 for claiming patent-ineligible subject matter.

  • Prior Art Relied Upon: Petitioner did not assert traditional prior art for anticipation or obviousness, but cited numerous documents to demonstrate that the claimed concepts are longstanding, fundamental economic practices. Key references included: Geisst (Charles R. Geisst, 100 YEARS OF WALL STREET, (2000)), Carret (Philip Carret, THE ART OF SPECULATION, (1927)), and various technical articles and exchange specifications describing "kill switch" and "bulk cancel" functionalities.

  • Core Argument for this Ground: Petitioner argued that the challenged claims fail the two-step framework from Alice Corp. v. CLS Bank Int'l. for determining patent eligibility.

    • Alice Step 1: Directed to an Abstract Idea: Petitioner asserted that all claims are directed to the abstract idea of collecting market information, identifying the occurrence of an event from that information, and cancelling pending orders. This was framed as a fundamental economic and commercial practice prevalent for over a century, analogous to hedging in Bilski or intermediated settlement in Alice. Petitioner provided extensive historical evidence, arguing that the core steps—monitoring ticker tapes, posting prices on a board, and brokers cancelling orders via telephone—were routine long before the patent's filing date. The petition contended that the claims simply automate this well-known human activity without adding anything inventive. The process of collecting, normalizing, and analyzing data was argued to be a well-established abstract idea in itself.

    • Alice Step 2: Lack of an Inventive Concept: Petitioner argued that the claims lack an inventive concept sufficient to transform the abstract idea into a patent-eligible application. The implementation of the abstract idea was characterized as using only generic and conventional computer components.

      • Prior Art Mapping: The independent claims (1, 17, 20, 23, 28) recite elements such as "collection controllers," "processors," and "switches." Petitioner contended these are generic hardware components performing their ordinary functions (collecting, processing, terminating connections) without any improvement to computer technology itself. The claimed method was argued to be an automation of a manual process, merely providing the known benefits of speed and efficiency. Crucially, Petitioner highlighted the patent’s own admission that the "Cancel Upon Disconnect" process—a key mechanism for cancellation—was "already existing" and "typically in place" at liquidity destinations.
      • Key Aspects: The argument for dependent claims (2-16, 18-19, 21-27, 29-30) asserted that they add nothing more than conventional and routine limitations. For example, requirements for "real-time data" (claim 3), invoking a "single action" to cancel (claim 18), or using logical/physical switches (claims 24, 25) were all described as well-understood activities in the art that fail to supply an inventive concept. Petitioner argued that, taken individually or as an ordered combination, the claim elements amount to nothing more than an instruction to apply a fundamental economic practice using generic computer technology, which is insufficient to confer patent eligibility.

4. Arguments Regarding CBM Eligibility

  • Covered Business Method (CBM) Qualification: Petitioner asserted the ’371 patent is eligible for CBM review because every claim is directed to a method or apparatus for performing operations used in the practice of a financial product or service—specifically, a "method for cancelling pending orders for financial articles of trade."
  • Technological Invention Exception: Petitioner argued the ’371 patent does not fall under the technological invention exception. The petition contended that the claims fail to recite a novel and unobvious technological feature that solves a technical problem with a technical solution. Instead, the patent addresses a business problem (the "burdensome process" of cancelling orders) by automating a known business practice with generic, off-the-shelf computer components. The claims do not purport to improve the functioning of the computer or network itself but only use them as tools to achieve a commercial goal.

5. Relief Requested

  • Petitioner requested the institution of a Covered Business Method patent review and the cancellation of claims 1-30 of the ’371 patent as unpatentable under 35 U.S.C. §101.