[00:00:22] Speaker 04: We will hear argument next in number 161592, D'Agostino against MasterCard. [00:00:32] Speaker 04: Mr. Greenspoon, whenever you're settled and ready, please come up and begin. [00:00:37] Speaker 02: Thank you, Judge Cerrato. [00:00:44] Speaker 02: And good morning, Your Honors. [00:00:45] Speaker 02: May it please the Court. [00:00:47] Speaker 02: Even MasterCard does not [00:00:50] Speaker 02: defend the PTAB's claim construction as it's written. [00:00:53] Speaker 02: And we see this in the red brief at pages 26 to 27. [00:00:56] Speaker 02: And I submit, how could they? [00:00:59] Speaker 02: Because the claim construction as it's written expresses a logical contradiction. [00:01:05] Speaker 04: Can I just make sure I understand some of what the board decided and what it didn't? [00:01:14] Speaker 04: So my understanding is you have a set of one or more merchant claims and you have single merchant claims. [00:01:20] Speaker 02: Am I right? [00:01:21] Speaker 02: That's correct. [00:01:22] Speaker 02: That's a numerical limitation. [00:01:25] Speaker 04: 21 is kind of the representative single merchant claim. [00:01:29] Speaker 02: I believe that's the 988. [00:01:30] Speaker 02: Yes, that's correct. [00:01:32] Speaker 04: And the board decided anticipation and obviousness based on Cohen, in one case, and Cohen plus something else in the obviousness [00:01:42] Speaker 04: on the single merchant claim and everybody agreed that if that were correct, the one or more merchant claims also go down and didn't otherwise address the one or more merchant claims, right? [00:01:57] Speaker 02: I believe that's correct, except that their conceptual mistake about what it means to be a one or more merchant limitation is pervading the opinion. [00:02:07] Speaker 04: But it's definitely correct that we did not independently argue the one or more if the single merchant claims were... And as to the single merchant claim, the board relied for this, for the claims, single merchant claims, the board relied on one portion of Cohen, the chain of stores portion, and not on another portion which [00:02:35] Speaker 04: obviously MasterCard thinks is significant because it actually put it first in its bullet point list, column two, lines 35 or something, that refers to the one-time single transaction idea. [00:02:51] Speaker 04: And you have a footnote in your gray brief that says that doesn't really apply because you have to be able to have multiple transactions for anything, but that was not decided by the board. [00:03:00] Speaker 04: So what we have in front of us is [00:03:03] Speaker 04: The single merchant claims, the particular limitation or pair of limitations applied to the single merchant claims. [00:03:10] Speaker 04: And the question is, under any reasonable construction, can that cover the chain of stores example? [00:03:18] Speaker 02: Well, yes, under the broadest reasonable construction. [00:03:21] Speaker 02: Yes. [00:03:21] Speaker 02: Everything you said, Your Honor, it fits exactly what I understand the procedural posture of the case to be. [00:03:26] Speaker 02: Yes. [00:03:27] Speaker 02: Yes, Judge. [00:03:28] Speaker 02: If I may continue with the argument, [00:03:31] Speaker 02: The PTAB construction itself is at A13 and A38. [00:03:35] Speaker 02: And what it states is merchant transactions are included in the payment category before a customer first transacts with a merchant. [00:03:44] Speaker 02: And so this is the root of our logical contradiction argument. [00:03:48] Speaker 02: It just makes no sense, because transactions cannot exist before they exist. [00:03:54] Speaker 02: And as we point out in the briefing, the PTAB also reasoned by the improper methodology [00:04:00] Speaker 02: of using? [00:04:01] Speaker 04: Well, one of the problems I've had with the briefing in this case is that so much of it is about meta questions, method questions, as opposed to just asking, what is the range of reasonable constructions of this claim term? [00:04:15] Speaker 04: And large parts of the other side's brief attack particular arguments you make. [00:04:20] Speaker 04: That's why I tried to define what I think the issue is. [00:04:25] Speaker 04: And the board, I think, on pages 17 and 18 of its opinion [00:04:29] Speaker 04: seems, on the one hand, to refer to it as an application question, and on the other hand, once, at least on page 18, refers to it as our claim construction about the chain store example. [00:04:42] Speaker 04: It's not clear to me. [00:04:43] Speaker 04: It makes a bit of difference which category you put it into. [00:04:48] Speaker 04: The question is, can this language apply to either Target on the one hand or McDonald's on the other hand? [00:04:55] Speaker 04: And I can think of [00:04:57] Speaker 04: A perfectly good reason, it can't apply to Target because you've said Target and Target is the merchant regardless of where you go. [00:05:05] Speaker 04: And so it is a single merchant, but you've identified who it is. [00:05:10] Speaker 04: So you can't have to meet the second element. [00:05:13] Speaker 04: And for McDonald's, it's not a single merchant because they're franchises. [00:05:18] Speaker 04: So I'm not sure why it matters whether this is claim construction or an unreasonable application. [00:05:24] Speaker 04: I guess that's what I want you. [00:05:26] Speaker 04: you to address rather than they followed the wrong methodology or anything like that. [00:05:30] Speaker 02: Naturally, and let me just get right to the heart of it. [00:05:32] Speaker 02: So a good example quotation from the claim language, it's more or less the same formulation all around. [00:05:39] Speaker 02: Said single merchant limitation being included in said payment category prior to any particular merchant. [00:05:46] Speaker 04: I'm sorry, what are you reading from? [00:05:47] Speaker 02: Oh, this is essentially a claim. [00:05:50] Speaker 04: I need a page. [00:05:51] Speaker 04: I need to look at whatever you're. [00:05:53] Speaker 02: Yeah, absolutely. [00:05:55] Speaker 02: I would... Is this like from Claim 21? [00:06:00] Speaker 02: It's from Claim 21. [00:06:01] Speaker 01: It's best block quoted in the blue brief. [00:06:06] Speaker 01: Sub-paragraph B, is that what you were referring to? [00:06:09] Speaker 01: Your Honor, I would go to the blue brief where there are some block quotes of what the limitations are. [00:06:15] Speaker 02: Of course, I am having trouble finding it, but I think if we look at Claim 21, we'll see [00:06:24] Speaker 02: either those exact words or at best a nominal difference. [00:06:31] Speaker 01: How about the appendix, page 68? [00:06:33] Speaker 01: Thank you, Your Honor. [00:06:35] Speaker 02: That's exactly right. [00:06:37] Speaker 02: That's where Claim 21 is. [00:06:39] Speaker 02: So the heart of it, of course, is that for every claim, the intrinsic record really supports only one construction or application, depending on how you want to slice and dice it. [00:06:51] Speaker 02: And that's essentially that [00:06:52] Speaker 02: The single merchant limitation is establishing a numerical limitation without pre-identifying the name or content of who's going to fill that slot. [00:07:07] Speaker 02: And then later, there's a time requirement or a timing requirement in the claim where you populate that slot with who the consumer has gone to identify as the particular merchant. [00:07:19] Speaker 02: That's really the heart of it. [00:07:21] Speaker 02: None of the different permutations described in Cohen, but particularly the chain of stores treated by the PTAB, hits exactly that. [00:07:29] Speaker 02: So I hope that addresses the question, Your Honor. [00:07:33] Speaker 02: The invention's goal right at this point is maximum consumer flexibility. [00:07:39] Speaker 02: Supported by the prosecution history at A1501, that's where there's a [00:07:47] Speaker 02: response to an office action, which very crisply and clearly explains that this is a great and wonderful invention because the consumer doesn't have to really know who's going to end up being in the single merchant limitation because the consumer has maximum flexibility to go out and pick that person later on. [00:08:07] Speaker 04: Can I ask you something about, and this has to do with why I started with distinguishing the single merchant claims from the one or more merchant claims. [00:08:17] Speaker 04: The single merchant claims it is really pretty easy to see that the merchant, a class of merchants numbering one that you have identified without saying who it is, that that follows from the language of the claim. [00:08:36] Speaker 04: A particular merchant you haven't identified is the single merchant. [00:08:40] Speaker 04: Less clear on the one or more where it is at least on its face, [00:08:47] Speaker 04: before you get to any prosecution history seems at least more admissible to say you can give a kind of group descriptor. [00:08:56] Speaker 04: A group descriptor doesn't necessarily identify a particular merchant. [00:09:04] Speaker 04: So I guess I'm interested in your view of whether it's the prosecution. [00:09:09] Speaker 04: And we don't have that question in front of us because the board relied entirely on the single merchant. [00:09:17] Speaker 04: limitations said that was unpatentable or single merchant claims. [00:09:22] Speaker 04: They were unpatentable and everybody agrees if they were unpatentable the rest are. [00:09:26] Speaker 04: But it seems to me imaginable that there are two different results for the two classes of claims. [00:09:34] Speaker 02: There's only one sort of extra perspective to add to the one or more merchants limitation and that is you think of the words single merchant limitation as [00:09:44] Speaker 02: a numerical quantity definition of one. [00:09:48] Speaker 02: You think of the one or more merchants limitation as a numerical quantity definition of one or more but a finite. [00:09:57] Speaker 02: An identified number? [00:09:58] Speaker 04: An identified number? [00:10:00] Speaker 04: Is it at page 13 or something? [00:10:02] Speaker 04: There's a paragraph or so in the final written decision under the heading of [00:10:10] Speaker 04: I'll find it. [00:10:12] Speaker 04: It says everybody agrees what the claim interpretations are of the one or more merchant. [00:10:18] Speaker 04: And I couldn't quite tell whether what everybody agrees is that, yes, it's on page 13 at the bottom. [00:10:25] Speaker 04: One or more merchants, everybody agrees, means one merchant up to a plurality of merchants where the number of merchants is a finite number respectively. [00:10:33] Speaker 04: Does that mean that a [00:10:36] Speaker 04: A particular number has to be given to the, let's call it the security company. [00:10:41] Speaker 04: It says 13, that's how many. [00:10:44] Speaker 04: Or it can be something more like computer stores. [00:10:48] Speaker 04: We live in a finite world, so there are only a finite number in those. [00:10:52] Speaker 02: The first but not the second. [00:10:53] Speaker 02: In practice, it would be the consumer telling the authorizing authority, I want 13 different merchants to love on this card. [00:11:02] Speaker 02: The consumer walks around, hits store number 14, [00:11:05] Speaker 02: and the card is gonna be declined or unapproved. [00:11:08] Speaker 02: That's how that would work in practice, in implementation, that's right. [00:11:13] Speaker 02: I'm into my rebuttal time, but if I may, I can't leave the podium without making one point, and that is that we have a reexamination file history here, and we have a reexamination certificate that happened almost, well, it overlapped, so there's a lot of simultaneous activity between the central reexamination unit and the PTAB, [00:11:34] Speaker 02: And the ProxyCon case, several other cases, say that even the PTAP in a trial proceeding has to consider the re-examination history and take it for what it's worth. [00:11:45] Speaker 02: The MasterCard itself stated there be, their words, inconsistency, confusion in the appearance that the PTO and this board has sanctioned two diametrically opposed decisions if the re-examination [00:12:00] Speaker 02: confirmation stood at the same time that their arguments in the PTAB prevailed. [00:12:04] Speaker 02: And we actually agree with that perspective on what eventually happened. [00:12:09] Speaker 04: So is this an argument that the board just didn't give attention to it? [00:12:16] Speaker 04: It's kind of a procedural. [00:12:17] Speaker 04: They have to discuss it, not they are bound by it or something like that? [00:12:22] Speaker 02: I'll suggest a case that makes it more than just procedural. [00:12:26] Speaker 02: And that's the Tempo lighting case actually cited in the PTAB decision. [00:12:30] Speaker 02: within the footnote that we're discussing. [00:12:35] Speaker 04: What footnote are we discussing? [00:12:38] Speaker 02: Sorry. [00:12:39] Speaker 02: There is a footnote on A16. [00:12:41] Speaker 02: OK, got it. [00:12:42] Speaker 02: It starts on A15. [00:12:44] Speaker 02: But this is the footnote where this is their entire discussion and dismissal of the re-examination proceedings. [00:12:50] Speaker 02: And my point of view is that what they said is it's not consistent with what we're holding today, so therefore it's confusing. [00:12:59] Speaker 02: But it really should have operated in the other direction. [00:13:02] Speaker 02: If it's not consistent with what they were holding, then they should have gone to the teachings of tempo lighting, the case that they cite themselves, in which the shared understanding of what a claim means between the examiner and the re-examination patentee controlled the outcome of what the proper claim construction was. [00:13:22] Speaker 02: This is not a matter of prosecution disclaimer. [00:13:24] Speaker 02: the record showing a shared understanding that was utilized by the office and utilized by the patentee, and that was disregarded. [00:13:32] Speaker 02: So, well into my rebuttal, I would like to request that the court reverse the PTAB decisions. [00:13:40] Speaker 02: Thank you, Mr. Greenstein. [00:13:44] Speaker 04: And Mr. Williams. [00:13:55] Speaker 03: Thank you, your honor. [00:13:57] Speaker 03: It may please the court. [00:14:02] Speaker 03: OK, so let me just start with the notion that we're not defending the PTABS construction. [00:14:06] Speaker 03: I don't agree with that. [00:14:06] Speaker 03: We are defending the PTABS construction. [00:14:08] Speaker 03: We don't believe there's any sort of logical contradiction in the construction. [00:14:12] Speaker 03: And the error that was alluded to by my friend here has to do with the sort [00:14:19] Speaker 03: beginnings of that construction, the first couple words of that construction, and what it means that the merchant limitations are included and what exactly is being referred to there. [00:14:27] Speaker 03: None of that is relevant to the analysis the PTAB applied here with respect to Cohen. [00:14:32] Speaker 03: If anything, that construction, to the extent it's in any way erroneous, simply narrows the claims and so should help them. [00:14:38] Speaker 04: What is the construction you think is correct under the BRI standard? [00:14:43] Speaker 03: On the BRI standard, I would say the construction the PTAB gave, although I note that [00:14:47] Speaker 03: Most of the time in the briefs, the parties refer to one aspect of that construction, not the entirety of the construction. [00:14:54] Speaker 03: I think it's important that this court look to the entirety of what the PTEB actually said when it was construing these terms. [00:15:01] Speaker 04: So the board said at page 18, and it actually referred to this once as its construction, that the single merchant can include target because it doesn't tell you which target store it goes to. [00:15:15] Speaker 04: Correct. [00:15:15] Speaker 04: be anything other than just unreasonable. [00:15:19] Speaker 04: Unreasonable as an application or unreasonable as a construction. [00:15:21] Speaker 03: It's completely reasonable because... It's the same company. [00:15:25] Speaker 04: You've told the security company, transaction target, you then go buy it at target. [00:15:30] Speaker 03: Absolutely, because the board specifically addressed that question of whether the same company means merchant. [00:15:35] Speaker 04: The claims don't say company, the claims say merchant, so now you're asking about... Okay, I'll say, it is in fact the same merchant, the same seller. [00:15:43] Speaker 03: Well, the board said it's not, and the board's construction. [00:15:45] Speaker 04: Tell me why that's not just flat out unreasonable. [00:15:48] Speaker 03: Because that was the construction the patent owner offered for merchant, which the board adopted. [00:15:52] Speaker 03: I'm sorry, what was the construction? [00:15:54] Speaker 03: The construction of merchant is very broad, and so this is a very important point. [00:15:58] Speaker 04: Target is the counterparty in a sale transaction, no matter what store you go to. [00:16:03] Speaker 03: So if the claims were directed to your counterparty in a sales transaction, that would make sense. [00:16:08] Speaker 03: But the board was very careful here. [00:16:09] Speaker 03: The claims don't say that. [00:16:11] Speaker 03: The claims have this distinction, supposedly, between single merchant and a particular merchant. [00:16:15] Speaker 03: And what the board is saying is that those two terms don't have to mean the same thing. [00:16:19] Speaker 04: Right. [00:16:19] Speaker 04: And I don't understand why that's rational. [00:16:22] Speaker 03: Because you could have, if you wanted to limit merchant to the particular company with which you were transacting, you could have said that in the claims. [00:16:29] Speaker 03: They didn't say that. [00:16:30] Speaker 03: They didn't ask for that construction. [00:16:31] Speaker 00: What about where they say any particular merchant being identified as said single merchant? [00:16:36] Speaker 03: OK. [00:16:37] Speaker 03: So that's the claim language verbatim. [00:16:39] Speaker 03: There was never a construction of what that meant below. [00:16:42] Speaker 00: But doesn't that itself suggest that the particular merchant has to be said single merchant? [00:16:48] Speaker 03: And that's the argument that's now being made on appeal for the first time. [00:16:51] Speaker 03: It was never presented to the PTAB. [00:16:53] Speaker 04: It's an argument in support of the same position. [00:16:55] Speaker 03: It's an argument in support of a construction that doesn't distinguish between the two cases you're talking about. [00:17:02] Speaker 03: OK, so let me just point you in. [00:17:04] Speaker 04: I didn't understand what you just said. [00:17:05] Speaker 03: OK, well, let me maybe answer it in a slightly different way by focusing on what the board actually said when they get to this issue. [00:17:12] Speaker 03: Because this point was certainly not lost on the board. [00:17:14] Speaker 03: I mean, it was fully analyzed. [00:17:14] Speaker 04: No, they relied. [00:17:15] Speaker 04: I mean, they relied. [00:17:16] Speaker 04: In Cohen, the one thing they relied on is chain stores. [00:17:18] Speaker 03: Yeah, so they fully analyzed this construction and this exact issue. [00:17:21] Speaker 03: So if you look into the final written decision at appendix starting at appendix 11, [00:17:36] Speaker 03: So you see here, they're talking about a couple different claim limitations together, particular merchant and then this big limitation that we're sort of fighting about now. [00:17:45] Speaker 03: And the first thing that I want to point out at the top of 12 is the board clearly says, we determined that single merchant includes the particular merchant without identifying the particular merchant. [00:17:55] Speaker 03: So this is very important because it shows the board knows that the construction doesn't require that you somehow pre-identify the particular merchant into the payment category, which is the supposed logical contradiction that's being criticized here. [00:18:07] Speaker 03: They make clear that that's not what they're doing. [00:18:09] Speaker 03: They know that their construction is not pre-identifying the particular merchant. [00:18:13] Speaker 03: And they're saying that the single merchant is a broader concept than the particular merchant. [00:18:17] Speaker 03: So you can have target as a single merchant, and you can have the target on Main Street as a particular merchant. [00:18:23] Speaker 03: Those can be two different concepts. [00:18:25] Speaker 03: Why is that not unreasonable? [00:18:28] Speaker 03: Well, it seems perfectly reasonable to the board. [00:18:31] Speaker 03: They explain it by looking at the next definition, which is merchant. [00:18:34] Speaker 03: So here, again, on page 12, next paragraph, patent owner argues that the plain and ordinary meaning of merchant is someone who buys and sells goods. [00:18:46] Speaker 03: We agree. [00:18:46] Speaker 03: We know. [00:18:47] Speaker 03: This definition is not limited by any business dissociation or corporate relationship such that specific stores within a chain of stores are not individually merchants. [00:18:56] Speaker 04: Right, and so as I was reading that and I put a big question mark next to that sentence, I said, what could that possibly mean? [00:19:04] Speaker 03: It means exactly what the board was talking about here when it gets to analyzing the target situation, which is you can say, here's a card that's good at any target. [00:19:12] Speaker 03: Great. [00:19:14] Speaker 03: Now I have that card. [00:19:15] Speaker 03: I pick any target I want. [00:19:16] Speaker 03: I can go to one in Washington, DC. [00:19:17] Speaker 03: I can go to one in Palo Alto. [00:19:18] Speaker 03: I can go to one in Texas. [00:19:19] Speaker 03: Same merchant. [00:19:20] Speaker 03: The board says no. [00:19:21] Speaker 03: That's a particular merchant. [00:19:23] Speaker 03: You can't just answer. [00:19:24] Speaker 04: You can't just say the board said it. [00:19:26] Speaker 03: I see that you're not buying this argument. [00:19:29] Speaker 03: Let me just move on to the other example that they give, which is McDonald's. [00:19:32] Speaker 03: Completely different structure. [00:19:35] Speaker 03: This is a case where I get a card good at any McDonald's, and I can go to now any McDonald's location in the country or in the world, [00:19:41] Speaker 03: all of whom, or many of whom, are owned by different people. [00:19:43] Speaker 03: It's mixed, right? [00:19:44] Speaker 03: Right. [00:19:45] Speaker 03: Certainly there are many that are owned by different people. [00:19:46] Speaker 03: This was an issue raised during the board's questioning in the transcript below. [00:19:52] Speaker 03: And that's exactly the case where you clearly have now a merchant that's identified in one instance as McDonald's, but then is identified as the particular franchisee location when you go to use that card. [00:20:01] Speaker 04: Here's, I guess, my take on that. [00:20:04] Speaker 04: Correct me. [00:20:04] Speaker 04: It seems to me, when you say McDonald's, the one thing you have not done is limited to a single merchant. [00:20:11] Speaker 04: Because there are, I don't know what the numbers are, let's call 50,000 McDonald's of which 40,000 are separate merchants. [00:20:18] Speaker 04: Well, the boy, the board is- You fall out at that first phrase. [00:20:22] Speaker 04: You haven't limited it to a single merchant. [00:20:25] Speaker 04: The problem with Target is you have, but you've identified it. [00:20:29] Speaker 04: So you fall out at the second phrase. [00:20:31] Speaker 03: So the way the board again dealt with that issue is to say when you've identified [00:20:36] Speaker 03: the card is being good at McDonald's, you have now limited it to a single merchant. [00:20:40] Speaker 03: It's McDonald's. [00:20:41] Speaker 04: How is that possible? [00:20:41] Speaker 04: There are 40,000 sellers that have a certain, you know, it's a hub and spokes thing. [00:20:47] Speaker 04: They have a contractual relationship with the McDonald's company with all kinds of franchise agreements, but it's all contractual and they're separate merchants. [00:20:56] Speaker 03: Yeah, so the board concluded that in that case, this is when you get into that application section of the final written decision that I think you're on. [00:21:04] Speaker 03: Around 18. [00:21:05] Speaker 03: 17 and 18, where this is applied. [00:21:09] Speaker 03: And here they say this is an example where McDonald's is identified as a single merchant, i.e. [00:21:15] Speaker 03: McDonald's. [00:21:16] Speaker 03: But then you can pick a particular location of McDonald's where you're actually transacting with some particular franchisee in many cases who is not necessarily McDonald's. [00:21:25] Speaker 04: So where in the appendix is this transcript 33 to 37? [00:21:28] Speaker 04: I realize we often have this problem. [00:21:32] Speaker 03: Oh, sorry. [00:21:33] Speaker 03: OK. [00:21:36] Speaker 03: 58, 17. [00:21:55] Speaker 03: Thank you. [00:22:01] Speaker 04: Oh, this is the discussion that you quote near [00:22:04] Speaker 04: three-quarters of the way through your brief about how they conceded all of this? [00:22:12] Speaker 04: With the triple negatives? [00:22:14] Speaker 03: I'm abandoning the triple negative argument. [00:22:18] Speaker 03: After reading it now several times, I still don't know exactly what it means. [00:22:21] Speaker 03: Although I think it is clear that there was a concession having to do with McDonald's franchisees being separate from McDonald's as a corporate entity. [00:22:31] Speaker 03: at that point, regardless of how you're reading the triple negative, supposedly. [00:22:35] Speaker 03: But yes. [00:22:43] Speaker 03: So here's what, just back to the final written decision again. [00:22:46] Speaker 03: The board says, at the bottom of 17 over to 718, as discussed above, the particular merchant is the merchant with whom the customer is transacting, and the single merchant includes the particular merchant in a broad manner [00:23:00] Speaker 03: without identifying the particular merchant. [00:23:04] Speaker 03: And then they say, so the relationship between a chain and a particular store would satisfy that construction. [00:23:10] Speaker 03: If, in fact, what the patent owner is asking for now, which is that the single merchant must become the particular merchant, which is the only possible way you could distinguish this McDonald's situation, it seems to me, that argument was waived because it was never made below. [00:23:27] Speaker 03: The board was never, this argument was never explained to the board. [00:23:30] Speaker 03: They were never given a construction that said the single merchant has to become the particular merchant. [00:23:35] Speaker 04: Can I focus on one thing? [00:23:36] Speaker 04: I realize I'm getting a little obsessive here, but on page 18, the same sentence that we'd patent owner argues that in such a scenario, Target or McDonald's is both the single merchant limit. [00:23:49] Speaker 04: I don't know, and this doesn't even scan as an English sentence, is both the single merchant limitation and the particular [00:23:55] Speaker 04: Merchant I suppose that word limitation should not be there It I think the company is not a limitation, right? [00:24:03] Speaker 04: so and I see Patent owner does say that about target I'm not seeing that patent owner said that about McDonald's which it seems to me would be unfortunate for its argument It seems to me false as to McDonald's and I don't see either on patent owner response 31 32 which is [00:24:22] Speaker 04: Joint appendix 5499 to 5500, or in the transcript pages, which is what we were just going through, 5819, I guess 5817 to 20, it does not seem to me, but tell me if I'm wrong, that the patent owner agreed that McDonald's was a single merchant. [00:24:46] Speaker 03: So yeah, that's the point I'm not sure about. [00:24:48] Speaker 03: I agree. [00:24:51] Speaker 03: I think what they do concede is that the franchisee will clearly be separate entities. [00:24:58] Speaker 03: The question is, was the board here correct? [00:25:02] Speaker 03: Could it reasonably conclude that the single merchant didn't have to become the particular merchant? [00:25:07] Speaker 03: Could it instead include that the single merchant is a broader concept and can include particular merchants even within a single merchant [00:25:16] Speaker 03: umbrella. [00:25:17] Speaker 03: That seems like a completely reasonable decision that the board could make given that there was no attempt to amend these claims and given that there was no construction proposed that would clearly distinguish that case until after they lost. [00:25:30] Speaker 03: Only in the rehearing request do we for the first time see this argument that the particular merchant must, that the single merchant must become the particular merchant, which [00:25:40] Speaker 03: the argument being made by the patent owners, that excludes this case of target. [00:25:45] Speaker 03: Because as you point out, then, it's target on both sides of the equation. [00:25:49] Speaker 03: But that construction was never submitted to the PTAB below. [00:25:52] Speaker 03: They weren't given the opportunity to address this argument. [00:25:55] Speaker 03: If they had been given the opportunity to address this argument, they could have easily turned to another place in Cohen. [00:26:01] Speaker 03: I mean, that's the point of talking about these. [00:26:04] Speaker 03: Well, no, actually. [00:26:05] Speaker 03: Well, column 2, I mean, maybe, certainly column 2 would be fine. [00:26:08] Speaker 03: But I was actually thinking of something different. [00:26:10] Speaker 03: So I was looking in particular, if you look at column 8 of Cohen, there's a disclosure. [00:26:16] Speaker 03: This is 3561 in the joint index, hopefully. [00:26:20] Speaker 04: This is the as one example paragraph? [00:26:23] Speaker 03: Yeah, it is. [00:26:24] Speaker 03: And at the end of that paragraph, you see around line 35, any of these features in the present application can also be combined. [00:26:34] Speaker 03: Thus, the employee could be given a card for use in any computer store. [00:26:38] Speaker 03: Well, that's an example of a single merchant in a computer store that's not identified. [00:26:45] Speaker 03: You pick which computer store you want. [00:26:47] Speaker 03: They could have easily turned to this language to anticipate the claims under the argument that's now being made, but they were never given the chance because this argument wasn't raised to them until the rehearing [00:27:06] Speaker 03: I do want to address the re-examination point just briefly, unless the court has further questions about it. [00:27:13] Speaker 04: Can I just ask about the following? [00:27:16] Speaker 04: At the bottom of 11 and 12 in the appendix, and also 11 and 12 in the board's opinion, Pannono fails to provide us with a meaningful explanation as to how transactions are limited to a single merchant without identifying any particular merchant. [00:27:37] Speaker 04: I guess I thought that that was trivially easy to imagine. [00:27:42] Speaker 04: You get, starting right now when we send you the information to put into whatever the payment category, is that the term it says, the next merchant I transact with, that's the one. [00:27:59] Speaker 04: Don't know who it's going to be yet. [00:28:02] Speaker 04: And I haven't identified. [00:28:05] Speaker 03: I think that language that you're reading there has to do with the argument that was actually being made by the patent owner and his response. [00:28:10] Speaker 03: And unfortunately, the appendix doesn't have the complete patent owner response. [00:28:15] Speaker 03: And we're happy to submit the entirety of the patent owner response. [00:28:18] Speaker 03: I think we can get it. [00:28:19] Speaker 03: It's public, so you can download it from the PTAB's website yourself easily without registering. [00:28:24] Speaker 03: But here, what was actually the argument that was being made in the patent owner response was something completely different having to do with pre-identification of merchants and setting them up in a merchant category code. [00:28:33] Speaker 03: None of those arguments are relevant to the issues on appeal. [00:28:35] Speaker 03: But that, I think, was what was driving this language that you're reading. [00:28:40] Speaker 03: I mean, I take the point that it does seem now, in retrospect, the argument having been made having to do with data structures and filling in things, which is all new, that was never presented in the PTAB. [00:28:51] Speaker 04: Well, the data structure thing is just an analogy to get us to help understand, you know, imagine something [00:28:56] Speaker 03: Well, it's an important one, because if the claims were limited to that, we wouldn't be here, because there'd be no infringement case going on between the parties. [00:29:02] Speaker 03: No one would do that. [00:29:03] Speaker 03: Right. [00:29:03] Speaker 04: But their data structures would show that here's one way to think about what we're saying. [00:29:07] Speaker 04: Say, oh, now I see it. [00:29:08] Speaker 03: OK. [00:29:10] Speaker 03: Fair enough. [00:29:10] Speaker 03: And that's an argument that should have been made to the board so that they understood this point. [00:29:14] Speaker 03: And a construction of, as said, single merchants should have been made so that the board would recognize [00:29:19] Speaker 03: hey, what we're saying is it has to be the same merchant on both sides of this equation, which they then could have easily found a place in Cohen that disclosed that and resolved the case that way. [00:29:28] Speaker 04: Do you have anything else that you want to? [00:29:30] Speaker 04: I realize I've consumed your time. [00:29:32] Speaker 03: I did want to just address this reexamination point because it was raised. [00:29:35] Speaker 03: And so just bear with me for another maybe 10 seconds. [00:29:40] Speaker 03: What I would say is, [00:29:41] Speaker 03: But certainly there's nothing in the rules or this court's case law that requires the PTAB to defer to the finding of an examiner from the central reexaminations unit. [00:29:50] Speaker 03: I would point out that both the director of the central reexamination unit and the examiner who eventually allowed these claims rejected the claims. [00:29:59] Speaker 03: In the case of the examiner, rejected them twice. [00:30:01] Speaker 03: And it was only after the ex parte communications, because of course this was an ex parte reexamination, that the examiner changed his mind. [00:30:10] Speaker 03: The PTAB had the opportunity to hear actually arguments from two sides. [00:30:14] Speaker 03: We think that's sort of an axiom of American jurisprudence, that that's the best way to get to the truth. [00:30:19] Speaker 03: So to the extent there's a conflict between those decisions, we think the PTAB was the run. [00:30:23] Speaker 03: They got it right. [00:30:24] Speaker 03: Thank you. [00:30:28] Speaker 02: Mr. Greenspoon, a couple of minutes. [00:30:30] Speaker 02: Thank you, Judge. [00:30:31] Speaker 02: Just really some points of information. [00:30:33] Speaker 02: And taking a giant step back, if a claim says, [00:30:38] Speaker 02: 2 plus 2 equals 4. [00:30:40] Speaker 02: Let's put Alice aside for a second. [00:30:42] Speaker 02: But if a claim says 2 plus 2 equals 4, how many ways do you have to? [00:30:46] Speaker 02: What was that reference to? [00:30:50] Speaker 02: Please bear with me. [00:30:51] Speaker 02: OK. [00:30:52] Speaker 02: If a claim says 2 plus 2 equals 4, how many ways do you have to explain that? [00:30:57] Speaker 02: And if you explain it a different way, are you waiving the argument because you didn't explain it that way the first time you explained 2 plus 2 equals 4? [00:31:05] Speaker 02: The main point is we have [00:31:07] Speaker 02: pretty crisp language. [00:31:08] Speaker 02: It might be a difficult law school admissions test examination problem, but it has a correct answer. [00:31:14] Speaker 02: And the correct answer is exactly as Your Honor has been portraying it in questions to counsel. [00:31:20] Speaker 02: The pre-identification is forbidden. [00:31:25] Speaker 02: Points of information. [00:31:27] Speaker 02: We talked about A11, or my brother talked about A11, where Your Honor pointed out the sentence that didn't make sense. [00:31:35] Speaker 02: I didn't hear [00:31:37] Speaker 02: counsel say that that sentence was correct. [00:31:40] Speaker 02: I just heard him say it was inapposite. [00:31:42] Speaker 02: Next point of information is at A5817, the transcript does point to the unrebutted evidence of what is the definition of a chain of stores. [00:31:53] Speaker 02: On this point, Your Honor, when you said 50,000, 40,000 for McDonald's, I thought that was prescient because it turns out [00:32:01] Speaker 02: that there are about 80% of the McDonald's locations are franchisees, and about 20% happen to be corporate. [00:32:09] Speaker 02: I just know I've eaten at about 50,000. [00:32:11] Speaker 02: And with those points of information, I'm happy to receive more questions. [00:32:16] Speaker 02: But otherwise, I would simply ask that the court reverse the petition. [00:32:20] Speaker 04: Thanks to all counsel. [00:32:21] Speaker 04: Case is submitted. [00:32:22] Speaker 02: Thank you. [00:32:23] Speaker 04: And we will stand in recess. [00:32:33] Speaker 05: The honorable court is adjourned until Monday morning at 10 o'clock.