The Software IP Report

PTAB Declines to Institute CBM Review on Financial Industry Telecommunications Technology

The PTAB declines to institute CBM on US8189566 titled “Software based trading turret.” According to the patent specification, “[a] trading turret system is a specialized telephony switching system that allows a relatively small number of users to access a large number of external lines…” Components of the turret system can be implemented via hardware, software, or a combination of both.

Treating claim 1 as illustrative, the PTAB found that the claim is not a covered business method patent.

Claim 1 recites:

1. A communications system, comprising:

a turret switching system constructed to communicate to a Web server, a turret device, and to a remote communications device via a first communications network, the Web server being constructed to communicate to a client device via a second communications network, and the client device constructed to control switching across a plurality of lines; and

an interface having a button sheet corresponding to a plurality of line selectors and constructed to seize a corresponding line by causing the client device to communicate a predetermined message to the turret switching system over the second communications network.

To be eligible for CBM review, the claims of the patent must recite “a method or corresponding apparatus for performing data processing or other operations used in the practice, administration, or management of a financial product or service.” AIA §18(d)(1).

The petitioner argued that the ‘566 patent qualifies for CBM review because “[t]he claims recite a method and corresponding apparatus for providing software trading turrets which are utilized in the financial industry, such as trading floor environments.”

The PTAB disagreed because the “turret switching system” as claimed does not “explicitly refer to trading or any other activity that arguably could be financial.” The scope of the claim “is not limited to financial activity.” Citing Secure Axcess, LLC v. PNC Bank Nat’l Ass’n, 848 F.3d 1370 (Fed. Cir. 2017), the PTAB found that even though the system could be used by traders, “this use, alone, does not pass the test for what constitutes a financial activity.”

Thus, the petition to institute CBM review was denied.

Those who listened to my webinar on CBM review will not be surprised by this ruling. It’s not enough to use the claimed concept in a financial product or service. To be eligible for CBM review, the claims need to be directed to a technology that really only applies to financial products or services.