Price F X AG v. Vendavo Inc

1. Case Identification

• Case #: CBM2019-00020
• Patent #: 8,396,814
• Filed: December 10, 2018
• Petitioner(s): Price f(x) AG and Price f(x), Inc.
• Patent Owner(s): Vendavo, Inc.
• Challenged Claims: 1-9 and 17

2. Patent Overview

• Title: Systems and Methods for Index-Based Pricing in a Price Management System
• Brief Description: The ’814 patent discloses computerized systems and methods for automatically adjusting product prices within existing deals. The technology responds to price variations in selected external indexes (e.g., commodity indexes) by re-pricing products when the index value changes beyond a predetermined threshold.

3. Grounds for Unpatentability

Ground 1: Ineligibility Under 35 U.S.C. §101 - Claims 1-9 and 17

• Core Argument: Petitioner argued that the challenged claims are directed to the patent-ineligible abstract idea of re-pricing products, a fundamental economic practice analogous to hedging. It was asserted that the claims fail the two-step Alice test because they merely recite this abstract concept and implement it using generic, conventional computer components without adding an inventive concept that transforms the idea into a patent-eligible application.
  • Abstract Idea (Alice Step 1): Petitioner contended that the claims, at their core, describe a business strategy for re-pricing products when a designated index deviates from an initial price by more than a threshold. This was compared to hedging against future price changes, a long-standing economic practice. The claims were argued to be directed to the manipulation of information (prices and indexes) rather than an improvement to computer functionality or any technological process.
  • No Inventive Concept (Alice Step 2): Petitioner asserted that the claim elements, viewed individually or as an ordered combination, fail to provide an inventive concept. The use of a computer to perform steps like "monitoring," "retrieving," "comparing," and "computing" was described as the routine application of a general-purpose computer to automate a known business practice. The addition of generic computer limitations was argued to be insufficient to confer patent eligibility, as it does not solve a technical problem or improve the functioning of the computer itself.

Ground 2: Obviousness over Kinney in view of Hausman - Claims 1, 6, and 7 are obvious over Kinney in view of Hausman

• Prior Art Relied Upon: Kinney (Patent 6,564,192) and Hausman (Application # 2004/0030632).

• Core Argument for this Ground: Petitioner argued that claim 1 contains conditional language where one path involves maintaining an initial price if an index change is below a threshold. This "maintaining" path was asserted to be fully disclosed or rendered obvious by the combination of Kinney and Hausman, making the entire claim unpatentable.

  • Prior Art Mapping: Kinney (’192 patent) was cited for disclosing a long-term contract system where prices are adjusted only if an index moves outside a "prescribed range" (i.e., a threshold). If the index remains within this range, the contract price does not change, which Petitioner equated to the claimed step of "maintaining... the initial pricing." While Kinney described a computer infrastructure for contract bidding, Petitioner argued it did not explicitly teach monitoring the index by computer. Hausman (’632 publication) was introduced to supply this element, as it explicitly discloses using a computer system to "periodically or continuously monitor the reference index" in the context of trading financial instruments.
  • Motivation to Combine: Petitioner contended that a person of ordinary skill in the art (POSITA) would have been motivated to apply the computerized monitoring taught by Hausman to the price-adjustment mechanism of Kinney. A POSITA would combine these teachings for the predictable and desirable result of automating the process of tracking an index to determine if a contract price needed modification, which was presented as an obvious improvement to Kinney’s system.
  • Expectation of Success: A POSITA would have a reasonable expectation of success in combining the references, as using a computer to monitor data was a well-known and routine task with predictable outcomes.

• Additional Grounds: Petitioner asserted additional challenges under 35 U.S.C. §112. These included arguments that claims 1-9 and 17 are indefinite for requiring an "apples and oranges" comparison between a product price and a potentially non-monetary index value. A separate indefiniteness challenge was raised against claim 17 for failing to disclose sufficient structure corresponding to its means-plus-function limitations.

4. Key Claim Construction Positions

• "Processor configured to" (Claim 17): Petitioner argued this term is governed by pre-AIA 35 U.S.C. §112, ¶ 6 and should be construed as a means-plus-function limitation.
  • Proposed Construction/Argument: Petitioner asserted that "processor" is a nonce term that does not connote a sufficiently definite structure capable of performing the specialized claimed functions (e.g., "computing a price... wherein the computing the price includes weighting the index and setting an index offset") without special programming. Petitioner argued that the specification fails to disclose the corresponding structure—a specific algorithm—required to perform this function. The disclosure was characterized as providing only high-level, functional descriptions and flowcharts that repeat the claimed function rather than detailing the steps to achieve it. This alleged failure to disclose a corresponding algorithm was argued to render claim 17 indefinite.

5. Relief Requested

• Petitioner requests institution of a Covered Business Method review and cancellation of claims 1-9 and 17 of the ’814 patent as unpatentable.