The Software IP Report

PTAB: Internet Advertising Patent Not Subject to CBM Review

The PTAB has denied Google’s petition for Covered Business Method (CBM) review of an Internet advertising patent, finding that Google failed to show that the patent is directed to “performing data processing or other operations used in the practice, administration, or management of a financial product or service.” Google Inc. v. KlausTech, Inc., Case CBM2016-00096 (PTAB February 27, 2017).  Accordingly, the PTAB entered an order that no trial be instituted to review U.S. Patent No. 6,128,651 (as reexamined).

The ’651 patent is directed “to a frame displayed on a website that includes ad content controlled and timed by a central controller.” The patent purports to solve the problem “that the advertiser who places and add has little control over how the ad is viewed at a user’s browser.”  Claim 20, added during an ex parte re-examination, was representative:

A non-scrolling ad display from a website for causing a browser hitting the website to undertake centrally controlled and recorded ad display for guaranteed minimum timed intervals comprising the steps of:

providing a website at a webserver for transmitting at least one page with a non-scrolling ad frame to a browser;

providing ad content for the non-scrolling ad frame, each ad content having ad identity and an individual timer for timing out commencing with display at the browser and an Internet address for fetching by the browser;

providing a central controller interrogating for browser identity and maintaining records associated with the browser identity indicating ad identity displayed, and timer timeout;

placing the ad content in the non-scrolling ad frame of the browser to display the ad content and start the individual timer;

timing out the individual timer of the ad content at the non-scrolling frame at the browser;

reporting from the browser to the central controller the timer timeout of the ad content;

retaining in the central controller a record of the browser identity, the ad identity, and the timer timeout of the ad content at the browser; and

transmitting to the reporting browser an Internet address for new ad content for placement in the non-scrolling ad frame in response to receipt of the timer timeout report at the central controller.

The PTAB panel began by emphasizing that its analysis was controlled by the recent case of Unwired Planet, LLC v. Google Inc., 841 F.3d 1376 (Fed. Cir. 2016). The panel, unsurprisingly, read that decision as limiting the scope of CBM review; just because practicing a patent could involve selling something does not make it meet the requirement of being “used in the practice, administration, or management of a financial product or service.”  Under Blue Calypso, LLC v. Groupon, Inc., 815 F.3d 1331 (Fed. Cir. 2016), the panel would focus “on the claims to determine whether there is anything ‘explicitly or inherently financial in the construed claim language.’”

The PTAB panel concluded that none of the claims were directed to a financial product or service. Even though “Internet advertising generally involves the sale of ad space, the fact that a sale has occurred or may occur is not enough when the challenged claims” failed to recite a sale or some other financial product or service. The claims here presented “nothing explicit or inherent” that was “financial in nature.” At most, arguments made by Google showed that there was the possibility of a sale, which was not enough.

Lessons

PTAB panels even before Unwired Planet had resisted the notion that a patent claim was subject to CBM review just because it involved managing something on a website.  Patent directed to the banking industry are clearly subject to CBM review.  And until Congress expands the scope of the program, other patents, even if they can involve money or commerce, may not be.

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