Bank Of America NA v. Nant Holdings IP LLC

1. Case Identification

• Case #: IPR2021-01388
• Patent #: 8,520,897
• Filed: August 26, 2021
• Petitioner(s): Bank of America, N.A.
• Patent Owner(s): Nant Holdings IP, LLC
• Challenged Claims: 25, 30, 33-34, 38-39, and 41-42

2. Patent Overview

• Title: Object Information Derived From Object Images
• Brief Description: The ’897 patent describes methods for conducting transactions by identifying a target object within a digital image that is itself displayed on a screen (e.g., a product on a television). The system uses an optical sensor to capture the displayed image and identifies the target based on its visual features without requiring barcodes or other embedded identifiers.

3. Grounds for Unpatentability

Ground 1: Obviousness over Ogasawara and Bolle - Claims 25, 30, 33-34, 38-39, and 41-42 are obvious over Ogasawara in view of Bolle.

• Prior Art Relied Upon: Ogasawara (Patent 6,512,919) and Bolle (Patent 5,546,475).
• Core Argument for this Ground:
  • Prior Art Mapping: Petitioner argued that Ogasawara taught the core method of independent claim 25. Ogasawara disclosed an electronic shopping system where a user’s wireless videophone (with a camera) captures an image of an item displayed on an LCD screen (e.g., an apple on a weight scale screen) to perform a transaction. Ogasawara’s system used “advanced pattern recognition software” to identify the item based on visual characteristics, associate it with information like price, and perform a purchase. Petitioner contended Bolle supplied the missing limitation of explicitly matching features from the captured image to features stored in a database. Bolle taught a produce recognition system that improves accuracy by first segmenting a target object (e.g., an apple) from its background, then determining its features (e.g., color, shape), and finally comparing those features to a database of reference features to recognize the object.
  • Motivation to Combine: A POSITA would combine Bolle with Ogasawara to improve the accuracy and reliability of Ogasawara’s recognition system. Petitioner asserted that Ogasawara’s system was limited when a target lacked a “distinct or identifiable shape,” a problem Bolle directly solved by teaching image segmentation to isolate the target from background noise before feature analysis. Integrating Bolle’s more robust feature extraction and database matching method into Ogasawara’s framework was presented as a predictable solution to a known problem.
  • Expectation of Success: Petitioner argued a POSITA would have a high expectation of success. Both references operate in the same field (image recognition for retail) using similar hardware (CCD cameras, processors). Bolle's segmentation and matching algorithms could be implemented as software on Ogasawara’s existing videophone or server hardware to predictably enhance its performance without requiring invention or undue experimentation.

Ground 2: Obviousness over Ogasawara/Bolle in view of Melick - Claims 30, 41, and 42 are obvious over Ogasawara and/or Bolle in view of Melick.

• Prior Art Relied Upon: Ogasawara (Patent 6,512,919), Bolle (Patent 5,546,475), and Melick (Patent 7,070,103).

• Core Argument for this Ground:

  • Prior Art Mapping: This ground addressed dependent claims requiring a "time varying image" (claim 30) and a "portable device" or "cellular phone" (claims 41-42). Petitioner argued that while Ogasawara and Bolle established the base system, Melick explicitly taught using a CCD-equipped device, such as a cellphone, to capture a video stream (a time-varying image) displayed on the LCD screen of another portable device (e.g., a PDA). This directly mapped onto the limitations of the challenged dependent claims.
  • Motivation to Combine: A POSITA would combine Melick’s teachings with the Ogasawara/Bolle system to extend its functionality. Given that Ogasawara already taught using a camera-equipped cellphone to capture images from an LCD screen, it would have been an obvious and commonsense step to apply Melick's technique for capturing video streams from such screens. This would allow the primary system to work with dynamic content and a wider range of modern portable devices, which was a clear design goal.
  • Expectation of Success: Success would be expected, as the combination involved applying a known technique (capturing video from an LCD with a cellphone camera, per Melick) to a known system (the Ogasawara/Bolle image recognition system) that already used the necessary hardware.

• Additional Grounds: Petitioner asserted that the challenged claims are anticipated by Ogasawara under the Patent Owner's interpretation of the claims in co-pending litigation.

4. Key Claim Construction Positions

• "recognition of a target based on the features" (claim 25): This term was central to the dispute.
  • Petitioner's Proposed Construction: "identification of a target by matching the features to features of targets stored in a database." Petitioner argued this construction is required because the patent repeatedly describes this database-matching process as the core novelty of the invention, distinguishing it from prior art that used barcodes.
  • Patent Owner's Position: "no construction necessary—plain and ordinary meaning." However, Petitioner noted that in parallel litigation, the Patent Owner had interpreted the term more broadly to include recognition based on alphanumeric characters on a check, without requiring matching to a database of image features. Petitioner argued this interpretation reads out the patent's stated novelty.

5. Arguments Regarding Discretionary Denial

• Petitioner argued strongly against discretionary denial under 35 U.S.C. §314(a) and the Fintiv factors. The central argument rested on a stipulation filed in the co-pending district court litigation.
  • Stipulation and Overlap (Factor 4): Petitioner stipulated that if the IPR is instituted, it will not pursue in the district court "any other ground involving Ogasawara, Bolle, and Melick... alone... or in combination with any other reference." This broad stipulation was argued to eliminate any significant overlap between the IPR and the district court case, strongly favoring institution.
  • State of Parallel Proceeding (Factors 2 & 3): Petitioner argued the district court case was in its early stages, with no trial date set, no substantive claim construction orders issued, and discovery ongoing, weighing in favor of institution.
  • Other Factors: Petitioner contended that a stay of the district court case was likely if the IPR was instituted (Factor 1) and that the petition presented strong merits for unpatentability (Factor 6), both of which also favor institution.

6. Relief Requested

• Petitioner requested the institution of an inter partes review and the cancellation of claims 25, 30, 33-34, 38-39, and 41-42 of Patent 8,520,897 as unpatentable.