CSC ServiceWorks Inc v. PayRange Inc

1. Case Identification

• Case #: IPR2023-01188
• Patent #: 10,891,608
• Filed: July 17, 2023
• Petitioner(s): CSC ServiceWorks, Inc.
• Patent Owner(s): Payrange, Inc.
• Challenged Claims: 1-2, 4-8, 10-14, 16-20

2. Patent Overview

• Title: Method and System for an Offline-Payment Operated Machine to Accept Electronic Payments
• Brief Description: The ’608 patent describes a system for retrofitting an offline, payment-operated machine (e.g., a vending or laundry machine) with a payment module. This module enables the machine to accept electronic payments by communicating with a mobile device via a short-range wireless protocol and then emulating the electrical pulse signals of a traditional coin mechanism to initiate machine operation.

3. Grounds for Unpatentability

Ground 1: Claims 1-2, 5, 7-8, 11, 13-14, 17, 19-20 are obvious over Laaroussi, LeMay, and Sugimoto

• Prior Art Relied Upon: Laaroussi (Application # 2010/0227671), LeMay (Patent 10,121,318), and Sugimoto (Patent 4,374,557).
• Core Argument for this Ground:
  • Prior Art Mapping: Petitioner argued that Laaroussi discloses the core "payment module," a currency media reader hub (CMRH) retrofitted onto a gaming machine that can operate offline and emulate payment signals using "pulse string communication." LeMay teaches modifying such a system with a short-range wireless interface (e.g., NFC, Bluetooth) to communicate with modern mobile devices like smartphones for cashless transactions, which is an obvious improvement over Laaroussi’s RFID-based communication. Sugimoto provides the conventional technical details of a coin receiving mechanism, disclosing how coin switches generate specific electrical pulses based on coin denominations, which a POSITA would use to implement the pulse emulation functionality described at a high level in Laaroussi.
  • Motivation to Combine: A POSITA would combine Laaroussi and LeMay to enhance Laaroussi’s retrofit hub with the modern, convenient, and cost-saving mobile payment functionality taught by LeMay. A POSITA would have been further motivated to incorporate the teachings of Sugimoto to provide the necessary, well-known implementation details for the coin pulse emulation feature that Laaroussi’s hub was intended to perform. The combination applies known techniques to a known device for predictable results.
  • Expectation of Success: Petitioner asserted that modifying Laaroussi’s hub to include the mobile wireless interface of LeMay and the coin pulse logic of Sugimoto would have been a straightforward integration of known technologies to achieve the predictable result of a mobile-enabled payment retrofit module.

Ground 2: Claims 4, 6, 10, 12, 16, 18 are obvious over Laaroussi, LeMay, Sugimoto, and Okuniewicz

• Prior Art Relied Upon: Laaroussi (Application # 2010/0227671), LeMay (Patent 10,121,318), Sugimoto (Patent 4,374,557), and Okuniewicz (Patent 6,840,860).
• Core Argument for this Ground:
  • Prior Art Mapping: This ground builds on the combination of Laaroussi, LeMay, and Sugimoto from Ground 1. It adds Okuniewicz to address limitations in dependent claims requiring the payment module to obtain notifications from the host machine by "sampling the control signals from the control unit." While LeMay discloses a retrofit device obtaining notifications from a game controller, Okuniewicz explicitly teaches the technique of a retrofit device that samples signals directly from the host machine's circuit board to detect operational events (e.g., "coin in," "jackpot being hit") and generate a corresponding response. Okuniewicz also teaches that a gaming machine can be modified to function as a vending machine, dispensing bonus items on demand.
  • Motivation to Combine: A POSITA implementing the system of Laaroussi and LeMay would need a reliable method for the retrofit module to monitor the host machine's status and receive notifications. Petitioner argued that Okuniewicz provides a known and predictable technique for achieving this by sampling control signals. This would be an obvious design choice to ensure proper communication between the retrofit module and the host machine. Furthermore, Okuniewicz's disclosure of vending functionality would motivate a POSITA to apply the base payment system to a vending machine.
  • Expectation of Success: Combining Okuniewicz’s signal sampling technique with the primary combination would be a predictable integration, as interfacing retrofit devices with host machines is a common engineering challenge with known solutions like that taught by Okuniewicz.

4. Arguments Regarding Discretionary Denial

• Petitioner argued that discretionary denial would be inappropriate.
  • Fintiv: Denial under the Fintiv factors is not appropriate because Petitioner stipulated it would not pursue the same grounds or any that could have been reasonably raised in this petition in the parallel district court litigation. The litigation is also in a very early stage with no scheduling order entered.
  • General Plastic: Denial is not warranted as Petitioner is a different entity from the petitioner in a prior Post-Grant Review (PGR2021-00084) of the ’608 patent and has no significant relationship with that prior petitioner.
  • §325(d): Denial is not warranted because the Examiner did not consider any of the prior art references relied upon in this petition during the original prosecution of the ’608 patent.

5. Relief Requested

• Petitioner requests the Board institute an inter partes review and cancel claims 1-2, 4-8, 10-14, and 16-20 of the ’608 patent as unpatentable.