CSC ServiceWorks Inc v. PayRange Inc

1. Case Identification

• Case #: IPR2023-01449
• Patent #: 11,481,772
• Filed: October 9, 2023
• Petitioner(s): CSC ServiceWorks, Inc.
• Patent Owner(s): PayRange, Inc.
• Challenged Claims: 1-6, 8-20

2. Patent Overview

• Title: Method and System for Presenting Representations of Payment Accepting Unit Events
• Brief Description: The ’772 patent relates to a method performed on a mobile device for interacting with a "payment accepting unit," such as a vending machine. The method involves identifying nearby units, displaying them for user selection, establishing a wireless communication path to a selected unit, and presenting event notifications (e.g., transaction completion or failure) on the device's user interface.

3. Grounds for Unpatentability

Ground 1: Obviousness over Zhou, Athwal, and Low - Claims 1-6, 8, and 12-20 are obvious over Zhou and Athwal further in view of Low.

• Prior Art Relied Upon: Zhou (Patent 7,458,510), Athwal (Application # 2003/0130902), and Low (Patent 10,210,501).
• Core Argument for this Ground:
  • Prior Art Mapping: Petitioner argued that the primary references collectively teach the key limitations of the independent claims. Zhou taught a system for a mobile device to wirelessly authenticate and transact with a vending machine, including displaying status messages like "VENDING MACHINE APPROVED." Athwal taught a broader e-commerce system where a mobile device discovers all nearby "Electronic Retail Systems" (e.g., vending machines), displays their information for user selection, and uses both short-range communication (to the machine) and long-range cellular communication (to a remote financial server) to complete a transaction. Low was cited for its disclosure of a user interface that explicitly allows a user to select one machine from a plurality of available machines to transact with. Petitioner asserted that the combination of these references teaches identifying proximate payment units, displaying them for selection, establishing a communication path, enabling user interaction to complete the transaction, and displaying an updated user interface with the transaction outcome.
  • Motivation to Combine: A POSITA would combine Zhou's authentication method with Athwal's system for discovering multiple machines to improve efficiency and reduce transaction costs by leveraging the user's mobile device for long-range communication. A POSITA would further incorporate Low's user interface to enhance consumer convenience, a straightforward and predictable improvement allowing users to easily choose from a list of nearby machines.
  • Expectation of Success: Petitioner contended that a POSITA would have a reasonable expectation of success as the combination involved applying known techniques (e.g., user selection from a list) to improve a known system (mobile payments for vending machines) to achieve predictable results.

Ground 2: Obviousness of Claim 9 over Zhou, Athwal, and Low in view of Arora

• Prior Art Relied Upon: Zhou (Patent 7,458,510), Athwal (Application # 2003/0130902), Low (Patent 10,210,501), and Arora (Patent 9,898,884).
• Core Argument for this Ground:
  • Prior Art Mapping: This ground asserted that claim 9, which adds the limitation of receiving a transaction-based targeted coupon, is obvious over the primary combination in view of Arora. Arora taught a system that provides coupons to a user's mobile device based on their purchase history and the inventory of nearby vending machines.
  • Motivation to Combine: A POSITA would be motivated to add Arora's couponing feature to the base system to implement a well-known business strategy of incentivizing customer loyalty and increasing sales.
  • Expectation of Success: Integrating a known marketing technique like targeted couponing into a mobile payment application was argued to be a predictable modification within the skill of a POSITA.

Ground 3: Obviousness of Claim 11 over a Six-Reference Combination

• Prior Art Relied Upon: Zhou (Patent 7,458,510), Athwal (Application # 2003/0130902), Low (Patent 10,210,501), Arora (Patent 9,898,884), Casey (Patent 8,255,323), and Freeny (Patent 8,958,846).
• Core Argument for this Ground:
  • Prior Art Mapping: This ground challenged claim 11, which recites specific user interface features: a visual representation of the payment unit, an indication of a prepared balance, and a "swipe-to-pay" affordance. Petitioner argued these features were taught by the additional art. Arora taught displaying icons representing actual vending machines. Freeny taught a proximity payment system where an "approved credit amount" could be stored and checked on the user's device. Casey explicitly taught a "swipe to confirm" graphical element on a touchscreen to initiate and confirm a payment transaction.
  • Motivation to Combine: A POSITA would combine these individual UI features from analogous mobile payment and proximity transaction systems to create a more intuitive, secure, and user-friendly interface. Each feature addressed a known aspect of UI design: visual confirmation (Arora), financial awareness (Freeny), and deliberate action to prevent accidental payment (Casey).
  • Expectation of Success: Success was expected because combining known UI elements from the same technical field to improve user experience would have been a routine design task for a POSITA.
• Additional Grounds: Petitioner asserted an additional obviousness challenge for claim 10 based on the combination of Zhou, Athwal, Low, and Casey, relying on Casey's teachings of a user interface that confirms when a wireless communication link has been established.

4. Arguments Regarding Discretionary Denial

• Petitioner argued that discretionary denial would be inappropriate for several reasons.
• §314(a) (Fintiv): Petitioner contended denial under the Fintiv factors is not warranted because it stipulated that, if review is instituted, it will not pursue the same grounds or any grounds that could have reasonably been raised in the IPR in the parallel district court litigation. Further, the litigation was argued to be at a very early stage.
• General Plastic: Petitioner asserted that denial is inappropriate because, while another post-grant proceeding exists (PGR2023-00042), Petitioner here is a different entity, was not involved in the prior suit, and is advancing different grounds based on different primary prior art.
• §325(d): Petitioner argued that the asserted prior art is not cumulative to art considered during prosecution. Although several key references were listed in a 415-reference Information Disclosure Statement (IDS), the Examiner’s consideration was merely a perfunctory sign-off without any substantive analysis or explanation, which does not constitute a meaningful evaluation that would justify discretionary denial.

5. Relief Requested

• Petitioner requests institution of an inter partes review and cancellation of claims 1-6 and 8-20 of Patent 11,481,772 as unpatentable.