CBM Goes On, Even When the Qualifying Claim is Cancelled

A patent owner does not deprive a petitioner of standing in a covered business method (“CBM”) patent review by disclaiming the claim directed to a financial product or service.

In the final written decision for J.P. Morgan Chase & Co. v. Intellectual Ventures II LLC, CBM2014-00157, Paper 40 (Jan. 12, 2016), the PTAB determined the Petitioner had standing on the basis that at least one claim was directed to a method for performing data processing used in the practice of a financial product or service. Following institution of trial, the Patent Owner disclaimed claim 12 which recited “payment requirements,” and argued that the Petition should be dismissed for lack of standing because, after the disclaimer of claim 12, the challenged patent is no longer a covered business method patent. Intellectual Ventures asserted, “like a plaintiff before a federal court, Petitioners maintain their burden to show standing throughout the proceeding” (citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992)). Intellectual Ventures further argued that a patent owner may strip a petitioner of standing in the middle of the proceeding, forcing the tribunal to dismiss the proceeding.

The Board disagreed. It relied on Section 18(a)(1)(B) of the AIA which establishes: “A person may not file a petition for a transitional proceeding with respect to a covered business method patent unless the person or the person’s real party in interest or privy has been sued for infringement of the patent or has been charged with infringement under that patent.” Accordingly, the Board held “the plain language of the AIA requires us to determine whether petitioner had standing to file a petition for CBM patent review at the time the petition was filed; not whether petitioner has standing throughout the proceeding.”

Although a patent owner may not succeed in dismissal of a CBM by disclaiming “financial product or service” claims, it still is entitled to all appropriate defenses. For example, a “covered business method patent” does not include patents for “technological inventions.” Thus a patent owner should establish that “the claimed subject matter as a whole recites a technological feature that is novel and unobvious over the prior art; and solves a technical problem using a technical solution.” 37 C.F.R. § 42.301(b).

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