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

1. Case Identification

• Case #: IPR2018-01138
• Patent #: 9,659,472
• Filed: May 22, 2018
• Petitioner(s): Mobile Tech, Inc.
• Patent Owner(s): InVue Security Products Inc.
• Challenged Claims: 1-10 and 12-45

2. Patent Overview

• Title: Security System and Method for Protecting Merchandise
• Brief Description: The ’472 patent discloses a security system for retail environments that aims to prevent theft of merchandise. The system comprises a programming station that generates a unique security code, a programmable key that receives and stores the code, and one or more security devices that attach to merchandise and are controlled by the key.

3. Grounds for Unpatentability

Ground 1: Obviousness over Rothbaum and Denison - Claims 1-10, 12-15, 17-32, 34-43, and 45 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 discloses the foundational elements of a retail security system, including a security device attached to merchandise via a cable, an alarm that sounds if the cable is compromised, and a mechanical key to arm/disarm the system. However, Rothbaum’s mechanical key is susceptible to theft and unauthorized use. Denison was argued to solve this exact problem in the analogous art of vending machine security by teaching a system with an electronic, programmable key, a programming station (an "external computing device" with a "cradle"), and a unique "access code" (security code) that is programmed into both the key and the lock. The combination of Rothbaum's retail security framework with Denison's programmable electronic key system allegedly discloses all limitations of the independent claims.
  • Motivation to Combine: A Person of Ordinary Skill in the Art (POSITA) would have been motivated to replace Rothbaum's insecure mechanical key with Denison's more secure, field-programmable electronic key system. This would address the known problem of key theft and misuse, which is a shared problem between the retail security environment of Rothbaum and the unattended vending machine environment of Denison. The combination would predictably yield the benefits of enhanced security and control taught by Denison.
  • Expectation of Success: A POSITA would have had a reasonable expectation of success in combining these systems, as they are analogous arts addressing common security problems. The integration involved replacing a mechanical switch with a controller and adding electronic communication capabilities, which were well-understood modifications.

Ground 2: Obviousness over Rothbaum, Denison, and Ott - Claims 16, 33, and 44 are obvious over Rothbaum in view of Denison and Ott.

• Prior Art Relied Upon: Rothbaum (Patent 5,543,782), Denison (Application # 2004/0201449), and Ott (Patent 6,380,855).
• Core Argument for this Ground:
  • Prior Art Mapping: This ground builds upon the combination of Rothbaum and Denison from Ground 1 and adds the teachings of Ott to address claim limitations related to mounting the security device and adding anti-tamper features. Ott was argued to teach safeguarding merchandise by mounting a security device to a support surface using an adhesive. Furthermore, Ott disclosed using a "switching plunger" that engages the support surface, causing an alarm to activate if the entire security device housing is improperly removed from its mounting.
  • Motivation to Combine: A POSITA would have been motivated to incorporate Ott’s teachings to provide an additional layer of security to the combined Rothbaum/Denison system. Specifically, a POSITA would find it obvious to mount the security device housing to a display fixture and to add a plunger switch to prevent a thief from defeating the system by simply removing the entire device, a known vulnerability in retail security.

Ground 3: Obviousness over Rothbaum, Denison, and Deguchi - Claims 1-10, 12-15, 17-32, 34-38, and 41 are obvious over Rothbaum in view of Denison and 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 also builds on the Rothbaum/Denison combination but addresses the "port" limitations by adding Deguchi. Denison teaches a programming station that uses a separate "cradle" to communicate with the programmable key. Deguchi was argued to teach the desirability of eliminating such an intermediary cradle by integrating a communication port directly into the housing of a host device (e.g., a laptop) for direct communication with a portable device.
  • Motivation to Combine: A POSITA would have been motivated by Deguchi to integrate the communication port (Denison’s cradle) directly into the housing of the programming station or the security device. This modification would simplify the system, eliminate a separate component that could be lost or broken, and improve user-friendliness, representing a predictable design improvement.

• Additional Grounds: Petitioner asserted an additional obviousness challenge (Ground 4) for claims 16 and 33 based on the combination of Rothbaum, Denison, Deguchi, and Ott, arguing that the motivations to combine are the same as those articulated in the preceding grounds.

4. Key Claim Construction Positions

• "single security code": Petitioner argued this term should be construed to mean "one security code at a time." This construction is intended to counter any interpretation that the programming station is limited to generating only one code throughout its entire lifespan, which would conflict with dependent claims that require generating new codes.
• "usable in only a single retail store": Petitioner proposed this means the security code is capable of being used in only one retail store and is incapable of being used anywhere else. This construction emphasizes the inherent capability of the code itself, rather than how a user chooses to deploy it, giving full effect to the term "usable."
• "unique to the single retail store and the programming station": Petitioner contended this should be construed to mean a security code that is randomly generated by a programming station and used in a single retail store. This interpretation is based on the patent's specification, which describes a randomly generated code as being a "unique" code.

5. Arguments Regarding Discretionary Denial

• Petitioner argued that the Board should not exercise its discretion to deny institution under §325(d). Although Petitioner previously filed a Post-Grant Review (PGR) petition against the ’472 patent, that petition was denied solely on patent eligibility grounds (i.e., the patent was not eligible for PGR). The Board did not reach the merits of the obviousness grounds presented in that PGR, and therefore, the prior art and arguments in this IPR petition have not been previously considered on their merits by the Board.

6. Relief Requested

• Petitioner requested that the Board institute an inter partes review and cancel claims 1-10 and 12-45 of Patent 9,659,472 as unpatentable.