Mobile Tech, Inc. v. InVue Security Products Inc.

1. Case Identification

• Case #: IPR2017-01901
• Patent #: 9,478,110
• Filed: July 31, 2017
• Petitioner(s): Mobile Tech, Inc.
• Patent Owner(s): InVue Security Products Inc.
• Challenged Claims: 1-36

2. Patent Overview

• Title: Programmable Security System for Protecting Items of Merchandise
• Brief Description: The ’110 patent relates to security systems for protecting merchandise from theft in a retail environment. The system comprises a programming station, a programmable key, and a security device attached to an item. The system is designed to overcome the problem of stolen keys by using a unique security code, which is not chosen by a person and is unique to the retail store, to arm and disarm the security device's alarm.

3. Grounds for Unpatentability

Ground 1: Obviousness over Rothbaum and Denison - Claims 1-17 and 19-36 are obvious over Rothbaum in view of Denison.

• Prior Art Relied Upon: Rothbaum (Patent 5,543,782) and Denison (Application # 2004/0201449).
• Core Argument for this Ground:
  • Prior Art Mapping: Petitioner argued that Rothbaum disclosed a basic retail security system for protecting merchandise, but one that used a conventional mechanical key. This system met many claim limitations, such as a security device with an alarm attached to merchandise via a cable. Denison, in contrast, disclosed a security system with a programmable electronic key, a programming station, and the use of a unique, randomly generated security code to solve the known problem of keys being lost or stolen. Petitioner asserted that combining Denison's programmable key and programming station with Rothbaum's retail security device renders the system of independent claims 1 and 24 obvious.
  • Motivation to Combine (for §103 grounds): A person of ordinary skill in the art (POSITA) would be motivated to replace Rothbaum's outdated mechanical key with Denison's advanced programmable electronic key system. The motivation was to solve the very problem the ’110 patent addresses: the security risk of lost or stolen keys that could be used by unauthorized individuals. Both references are in the field of security devices for protecting merchandise, making the combination logical and pertinent.
  • Expectation of Success (for §103 grounds): A POSITA would have a reasonable expectation of success in combining the references, as applying electronic key technology to merchandise security systems was a well-understood and natural progression in the art at the time.

Ground 2: Obviousness over Rothbaum, Denison, and Deguchi - Claims 8, 18, and 25 are obvious over Rothbaum and Denison in view of Deguchi.

• Prior Art Relied Upon: Rothbaum (Patent 5,543,782), Denison (Application # 2004/0201449), and Deguchi (Application # 2004/0003150).
• Core Argument for this Ground:
  • Prior Art Mapping: This ground builds upon the combination in Ground 1 to address claims requiring a physical port for receiving the key (claims 8, 18, 25). The combination of Rothbaum and Denison taught a system with wireless (infrared) communication between the key and the security device. Deguchi taught the desirability of replacing an intermediary connection (like a separate cradle) or a wireless link with a directly integrated physical port (e.g., a male/female connector) for communication between a portable device and a host device.
  • Motivation to Combine (for §103 grounds): A POSITA would combine the teachings of Deguchi with the Rothbaum/Denison system for several reasons. Integrating a physical port would increase reliability, lower costs, and prevent the accidental disarming of nearby security devices that could occur with a broadcast infrared signal. Petitioner presented three independent rationales: (1) incorporating an infrared port to ensure line-of-sight communication; (2) using the same "cradle" interface for both programming and disarming to simplify the system; and (3) modifying Denison's wireless key to be a non-wireless key for cost and reliability, which necessarily requires a port.
  • Expectation of Success (for §103 grounds): Modifying a wireless system to use a direct physical port was a simple and routine design choice with a high likelihood of success.

4. Key Claim Construction Positions

• "programmed in a retail store" / "not chosen by a person": Petitioner argued that these are product-by-process limitations that should be afforded no patentable weight. The argument was that the final product—the programmed key or security device—is structurally identical regardless of the location of programming or whether a person selected the code.
• "unique security code": Petitioner contended this term imparts a structural limitation and should be given patentable weight. The proposed construction was broad, encompassing a randomly generated code or a code that is unique to a particular retail store, thereby preventing a key from one store from being used at another.
• "logic control circuit": Petitioner proposed this term be construed as a "collection of computer components" (e.g., microprocessor, memory) that are arranged to form a circuit and perform the functionality recited in the claims, such as generating a security code.

5. Key Technical Contentions (Beyond Claim Construction)

• Interpretation of Denison's Embodiments: Petitioner argued that a POSITA would not view the different communication methods in Denison (e.g., learning a code from a key, a handheld unit, or an external computer) as mutually exclusive embodiments. Based on Denison's explicit use of "and/or" and its definition of the "present invention," Petitioner contended that Denison taught a single, flexible system capable of all described functionalities. This argument was intended to preempt a potential counter-argument from the Patent Owner about improper mixing of embodiments from a single prior art reference.

6. Arguments Regarding Discretionary Denial

• Petitioner argued that discretionary denial under §325(d) would be inappropriate. Although Rothbaum and Denison were cited in an Information Disclosure Statement (IDS) during original prosecution, Petitioner asserted there was no evidence that the Examiner substantively considered or applied these references to the claims.
• Petitioner also noted the concurrent filing of another IPR petition against the ’110 patent. It argued that the petitions were not redundant because they relied on different prior art and distinct legal grounds (obviousness vs. anticipation), and thus institution of both would be proper.

7. Relief Requested

• Petitioner requested institution of an inter partes review and cancellation of claims 1-36 of the ’110 patent as unpatentable.