from the United States Patent and Trademark Office, Patent
Trial and Appeal Board in No. CBM2014-00176.
Douglas R. Nemec, Skadden, Arps, Slate, Meagher & Flom
LLP, New York, NY, argued for appellant. Also represented by
Paramjeet Sammi, Andrew Gish; James Y. Pak, Palo Alto, CA.
David van Loben Sels, Fish & Tsang LLP, Redwood City, CA,
argued for appellee. Also represented by Jennifer Shih.
E. Craven, Office of the Solicitor, United States Patent and
Trademark Office, Alexandria, VA, argued for intervenor
Joseph Matal. Also represented by
K. Kelley, Frances Lynch, Scott Weidenfeller.
Dyk, Mayer, and Reyna, Circuit Judges.
Acceptance Corp. ("CAC") appeals the final written
decision of the Patent Trial and Appeal Board
("Board") in a Covered Business Method
("CBM") review proceeding. The Board determined
that claims 10-12 and 14-33 of CAC's U.S. Patent No. 6,
950, 807 B2 ("the '807 patent") are directed to
patent-ineligible subject matter under 35 U.S.C. § 101.
CAC appeals the Board's determination that the
petitioner, Westlake Services, LLC ("Westlake"),
was not estopped from maintaining CBM review of those claims
under 35 U.S.C. § 325(e)(1). CAC also appeals the
Board's § 101 determination. Because we agree with
the Board that Westlake was not estopped from maintaining CBM
review of those claims and that the challenged claims are
unpatentable under § 101, we affirm.
the assignee of the '807 patent, which includes both
system and method claims directed to "provid[ing]
financing for allowing a customer to purchase a product
selected from an inventory of products maintained by a
dealer." '807 patent, abstract. In one embodiment,
the products are vehicles for sale at a car dealership. The
invention involves, inter alia, "maintaining a
database of the dealer's inventory, " gathering
financing information from the customer, and "presenting
a financing package to the dealer for each individual product
in the dealer's inventory." Id.
claims, such as the claims at issue here, involve the
application of these steps using elements such as a
"database, " a "user terminal, " and a
"server." For example, representative claim 25
25. A system for generating financing packages provided by a
financing party, for a customer purchase of a product from a
dealer's inventory of a plurality of products, the system
a database for storing information related to products in the
dealer's inventory including a dealer cost associated
with each product;
a user terminal, communicatively coupled to said database,
for receiving financial information about the customer in
relation to said products; and
a server having access to the data in the database adapted to
communicate with the user terminal over a network, whereby
the financial information about the customer may be
transmitted to the server,
the server generating a financing package for each product in
the dealer's inventory and transmit financing terms for
each financing package to the user terminal via the network
for presentation to the user for immediate purchase, wherein
the server is further configured such that the financing
terms of each financing package include an advance amount to
be paid to the dealer by said financing party if the customer
purchases the product associated with the financing package.
'807 patent, col. 15 ll. 17-38.
to this appeal are two CBM review proceedings involving the
'807 patent and the same petitioner (Westlake). In the
first proceeding, Westlake petitioned for CBM review of all
claims (1-42) of the '807 patent, asserting that the
claims are ineligible for patenting under 35 U.S.C. §
101. On March 31, 2014, in a decision that pre-dated the
Supreme Court's decision in Alice Corp. v. CLS Bank
International, 134 S.Ct. 2347 (2014), the Board
instituted review based on the § 101 grounds but with
respect to fewer than all of the challenged claims. The Board
instituted review of claims 1-9, 13, and 34-42, but it did
not institute review of claims 10-12 and 14-33 (the claims
now at issue). The Board was unpersuaded that claims 10-12
and 14-33 were more likely than not ineligible under this
court's then-prevailing decision in Ultramercial,
Inc. v. Hulu, LLC, 722 F.3d 1335 (Fed. Cir. 2013)
three months later, the Supreme Court issued Alice
and vacated the Ultramercial II decision relied upon
by the Board. WildTangent, Inc. v. Ultramercial,
LLC, 134 S.Ct. 2870 (2014). On August 20, 2014, in view
of the developments in § 101 jurisprudence, Westlake
filed a second petition for CBM review, again challenging
claims 10-12 and 14-33 as patent-ineligible under §
On November 14, 2014, we issued a revised
Ultramercial decision, Ultramercial, Inc. v.
Hulu, LLC, 772 F.3d 709 (Fed. Cir. 2014)
("Ultramercial III"), holding the claims
in that case patent-ineligible under § 101. Noting
recent authority on § 101 from the Supreme Court and
Federal Circuit (including the new Ultramercial III
decision), the Board instituted review of claims 10-12 and
14-33, concluding that it was "more likely than not that
[the challenged claims] are directed to abstract ideas with
no inventive concept." J.A. 938.
institution decision, the Board rejected CAC's argument
that the existence of the first CBM proceeding estopped
Westlake from challenging claims 10-12 and 14-33 under 35
U.S.C. § 325(e)(1). The Board's determination was
based on the fact that the first proceeding had not yet
resulted in a final written decision, and therefore,
CAC's estoppel argument was not ripe.
first and second instituted CBM proceedings continued in
parallel until March 24, 2015, when the Board issued a final
written decision in the first proceeding concluding that
claims 1-9, 13, and 34-42 of the '807 patent are
unpatentable under 35 U.S.C. § 101. On April 9, 2015,
CAC moved to terminate the second proceeding, again urging
that Westlake was estopped from challenging claims 10-12 and
14-33 under § 325(e)(1) now that the Board had issued a
final written decision in the first proceeding. The Board
denied CAC's motion, explaining that estoppel under
§ 325(e)(1) applies on a claim-by-claim basis and that
the final written decision in the first proceeding had only
ruled upon claims 1-9, 13, and 34- 42. Because that final
written decision did not rule upon non-instituted claims
10-12 and 14-33, Westlake was free (for purposes of estoppel)
to maintain its challenge to those claims in the second
January 25, 2016, the Board issued a final written decision
in the second CBM proceeding concluding that claims 10-12 and
14-33 of the '807 patent are unpatenta-ble under 35
U.S.C. § 101.
appeals that decision. It asserts that Westlake should have
been estopped from maintaining its challenge to claims 10-12
and 14-33 and argues that the Board's § 101 decision
was in error. Westlake opposes, and the United States Patent
and Trademark Office ("PTO") has intervened to
support the Board's decision on all issues. We have
jurisdiction pursuant to 28 U.S.C. § 1295(a)(4)(A).
"We review the Board's factual findings for
substantial evidence and its legal conclusions de novo."
Synopsys, Inc. v. Mentor Graphics Corp., 814 F.3d
1309, 1314 (Fed. Cir. 2016).
first argues that estoppel applies here to bar Westlake from
challenging claims 10-12 and 14-33 of the '807 patent in
light of the prior CBM proceeding which was instituted on
different claims. CBM review proceedings are governed by
section 18 of the Leahy-Smith America Invents Act
("AIA"), Pub. L. No. 112-29, § 18, 125 Stat.
284, 329-31 (2011), which adopts the "chapter 32
provisions of title 35 of the U.S. Code, governing post-grant
review ('PGR')." SightSound Techs., LLC v.
Apple Inc., 809 F.3d 1307, 1312 (Fed. Cir.
2015). Under those PGR procedures, a CBM review
proceeds in stages: first, the Board decides whether to
institute a review, and second, if review is instituted, the
proceeding enters a trial stage and the Board later issues a
"final written decision" under 35 U.S.C. §
328(a). Once the Board issues a final written decision, the
estoppel statute applies. The PGR estoppel statute relevant
here, which also governs CBM review proceedings under AIA
§ 18, provides,
Proceedings before the OFFICE.-The petitioner in a post-grant
review of a claim in a patent under this chapter that results
in a final written decision under section 328(a), or the real
party in interest or privy of the petitioner, may not
request or maintain a proceeding before the Office
with respect to that claim on any ground that the ...