[00:00:08] Speaker 01:
We have six cases on our docket for today.

[00:00:13] Speaker 01:
Two of them have been submitted and resolved on the brief.

[00:00:17] Speaker 01:
We have four cases that are scheduled for oral argument this afternoon.

[00:00:22] Speaker 01:
The first case is NRA Vienna 16-1062.

[00:00:26] Speaker 01:
Mr. Mathis?

[00:00:32] Speaker 01:
Now I understand you've divided your time.

[00:00:34] Speaker 01:
You're saving two minutes for rebuttal, is that correct?

[00:00:38] Speaker 01:
Okay, you may proceed.

[00:00:40] Speaker 04:
I'll start out with two issues, and I'll start out with one on compatibility.

[00:00:48] Speaker 04:
As you can see from the instance, I guess, as well as other cases I've asked you about, which you should notice, TTO introduced 101 practical inner quotes, part one and part two of the Supreme Court's Alice Corporation decision, loving more than meaningless exercises.

[00:01:06] Speaker 04:
Accordingly, I am pleased that this court has, with its Enfish and Bandai opinions, adopted positions that my clients have put forth for the last year and a half, including

[00:01:16] Speaker 04:
A position that claims are just not abstract simply because they can be done by an abstract, because they can be done by a generic computer.

[00:01:23] Speaker 04:
Two, the prohibition of just discounting claim limitations when determining what a claim is directed to under part one of ALIS.

[00:01:31] Speaker 04:
And three, expressly requiring the applications to factual assertions that claim limitations, individually and as ordered combination, are a well-known conventional routine.

[00:01:43] Speaker 01:
When I look at the claims, what I see is claims that are directed to a system to place value on real estate.

[00:01:52] Speaker 04:
Well, you would be obviously omitting the fact that you were doing special things to this, to the data.

[00:02:00] Speaker 04:
Yes, you are producing valuations for real estate, Your Honor.

[00:02:04] Speaker 04:
But I'm not just talking about, I'm just not claiming valuations for real estate.

[00:02:08] Speaker 04:
You're doing pre-processing, creating huge databases of pre-processed data that have specific utility.

[00:02:16] Speaker 01:
So show me in the claims then, where are the claims directed to something other than

[00:02:21] Speaker 04:
the this uh... valuation of real estate

[00:02:37] Speaker 04:
We're not only just generating AVM values, a plurality of AVM values, we're creating a database of them, and we're constantly updating these.

[00:02:47] Speaker 01:
Okay, 133?

[00:02:47] Speaker 01:
138.

[00:02:48] Speaker 01:
138.

[00:02:50] Speaker 04:
Where is 138?

[00:02:51] Speaker 01:
You briefed 133.

[00:02:52] Speaker 01:
I'm sorry.

[00:02:53] Speaker 04:
So in this case, with 133,

[00:03:01] Speaker 04:
you're doing something, and again, when you talk about whether something's abstract, you ask whether it's, and again, you look at what you, this quote talked about, Van Dyke.

[00:03:12] Speaker 04:
It's not whether it's done by a computer that makes it abstract.

[00:03:17] Speaker 04:
The analysis is forgetting what's happening with a computer.

[00:03:21] Speaker 04:
You're looking at ignoring the computer, whether the steps, as they are recited, are routine, conventional, well-known.

[00:03:30] Speaker 04:
And in this case, there's not even the assertion of this.

[00:03:32] Speaker 04:
I mean, Bandai, this court said, well, look, the evidence isn't there.

[00:03:40] Speaker 06:
Let's talk about this specific claim.

[00:03:41] Speaker 06:
What specific language in this claim do you suggest has more than an abstract idea of generating valuation?

[00:03:50] Speaker 04:
OK, in this case, repeatedly updating those valuations, Your Honor.

[00:03:53] Speaker 04:
And that has a very real-world utility that I'd like to get to.

[00:03:58] Speaker 01:
But that's what valuation is all about, isn't it?

[00:04:01] Speaker 04:
I'm not just claiming evaluations.

[00:04:03] Speaker 04:
Again, I'm talking about doing something very special, something very different.

[00:04:06] Speaker 01:
What?

[00:04:07] Speaker 01:
Show me the claims.

[00:04:08] Speaker 01:
What's special and different?

[00:04:10] Speaker 01:
Don't don't don't don't step into the step two of the of the Alice inquiry, okay In this case, I'm saying you're creating a database of AVM values now in this case

[00:04:25] Speaker 04:
If this were just about saying, oh, I'm providing AVM values to users, that's one thing.

[00:04:31] Speaker 04:
I'm not saying that.

[00:04:32] Speaker 04:
We're creating databases of these things.

[00:04:35] Speaker 04:
And we're constantly updating these.

[00:04:37] Speaker 06:
So you think updating a value is not an abstract idea?

[00:04:42] Speaker 06:
How is updating a value any different from generating that value in the first place?

[00:04:46] Speaker 06:
It's just generating a new updated value.

[00:04:49] Speaker 04:
Again, here's the difference, Ron.

[00:04:52] Speaker 04:
You have to look at the claim as a whole.

[00:04:54] Speaker 06:
I'm trying to, but you refuse to point to specific language in the claim that suggests something that's not an abstract idea.

[00:05:00] Speaker 04:
It's exactly not an abstract idea, and I'll tell you why.

[00:05:03] Speaker 06:
Let me ask you this.

[00:05:05] Speaker 06:
Do you think creation of a valuation is an abstract idea or something that would be ineligible under step one of alias?

[00:05:13] Speaker 04:
Well, here's the problem with your question, Your Honor.

[00:05:16] Speaker 06:
Can you answer my question?

[00:05:17] Speaker 04:
Absolutely.

[00:05:17] Speaker 04:
I don't think it's possible, Your Honor.

[00:05:19] Speaker 04:
I don't think it's possible because

[00:05:22] Speaker 06:
So, you obviously are familiar with Billsky, I assume.

[00:05:25] Speaker 06:
Billsky was a method, a business method.

[00:05:28] Speaker 00:
Yes, sir.

[00:05:30] Speaker 06:
Isn't a valuation method for real estate a business method?

[00:05:35] Speaker 04:
Yes, well, yes.

[00:05:36] Speaker 06:
So, it's ineligible under Billsky.

[00:05:39] Speaker 04:
No, well, first of all, this isn't a classic.

[00:05:41] Speaker 04:
No, Billsky, there's actually business being done.

[00:05:43] Speaker 04:
This is not business.

[00:05:44] Speaker 04:
This is not doing something, trading, you know, quid pro quo, some value for other.

[00:05:49] Speaker 04:
This is a tool.

[00:05:50] Speaker 04:
This is a tool that provides data for people who want to do business.

[00:05:54] Speaker 04:
That's completely different from what's going on in risky.

[00:05:58] Speaker 04:
And second, to say that not all business methods, if you're going to say that all business methods are abstract, well, OK.

[00:06:06] Speaker 04:
But unless you're going to declare at this point right now that all business methods are abstract, then you have to sit there and take into account what these claims do.

[00:06:15] Speaker 04:
Say that, OK, these claims do something specific, and at least

[00:06:21] Speaker 04:
consider why they do something special.

[00:06:25] Speaker 04:
And there are two advantages that I point out in front of the board and I point out here that you can do with this tool.

[00:06:33] Speaker 04:
This is not a business, it's a tool.

[00:06:34] Speaker 01:
Well, I don't think anyone's claiming that all business methods are abstract.

[00:06:39] Speaker 01:
On the other hand, if this claim is allowed, you're going to just pretty much preempt

[00:06:45] Speaker 01:
everything that deals with data concerning valuation of real estate, because that's what this claim is directed to.

[00:06:52] Speaker 01:
Show me what's in the claim that limits, that abstracts us.

[00:06:57] Speaker 04:
Okay, first of all, Your Honor, I'm going to take the opposite position.

[00:06:59] Speaker 04:
Nothing, nothing, absolutely nothing with respect to AVMs is preempted by this claim, except for the very narrow claim terms.

[00:07:09] Speaker 04:
No one, to my knowledge, has ever done anything like that.

[00:07:11] Speaker 04:
No one ever created a database of it.

[00:07:14] Speaker 01:
What narrows the claim terms?

[00:07:15] Speaker 01:
What is it that narrows them?

[00:07:17] Speaker 04:
In this case, it's not just a database of AVMs, a plurality of AVMs, but constantly updating these things to reflect market values.

[00:07:25] Speaker 04:
It has two specific utilities that nothing, no one has ever seen before.

[00:07:31] Speaker 02:
And one of these... Can I ask you to put aside for a minute the strain of abstract idea doctrine that's specifically connected with entering into commercial relations.

[00:07:45] Speaker 02:
Put that aside.

[00:07:46] Speaker 02:
Instead, talk to me for a minute about the related but distinct strain about gathering and manipulating information which you then want very much to use.

[00:07:59] Speaker 02:
Why is this not that?

[00:08:01] Speaker 04:
Well, seeing your opinions, I know you're very familiar with Bandai and Enfish.

[00:08:09] Speaker 04:
And if you're just going to say that this is software, again, this court is held.

[00:08:12] Speaker 02:
I didn't use the term software.

[00:08:14] Speaker 02:
I said gathering and manipulating information.

[00:08:18] Speaker 02:
This isn't just any information.

[00:08:21] Speaker 04:
If you're just going to discount the claim terms here, this is abstract.

[00:08:29] Speaker 04:
But if you're going to hold everything to that point, are you going to give the claim limitations weight or are you not?

[00:08:34] Speaker 05:
Which specific claim limitation do you think renders it non-abstract?

[00:08:40] Speaker 04:
In this case, the constant re-evaluation of the values so that the claim

[00:08:47] Speaker 04:
so that the database values are always current.

[00:08:50] Speaker 04:
They always reflect the market value.

[00:08:52] Speaker 04:
Here, no matter what time you look at it, at this database, you have, at that moment, values that are current to the market.

[00:09:01] Speaker 04:
And you can do a lot of things with that.

[00:09:02] Speaker 06:
And not only just... I'm not suggesting that this might be a very useful tool.

[00:09:07] Speaker 06:
That doesn't mean valuation and up-to-date valuation isn't abstract.

[00:09:14] Speaker 04:
Well, and the point is, the way I see that this court has talked about in the past with abstract, is that you have some sort of total human analog.

[00:09:22] Speaker 04:
So if you're going to say, if there's a total human analog, there's no evidence of it here, you're honest.

[00:09:27] Speaker 04:
If you're going to say that, okay, I've got a pen and pencil, I'm doing this, forget the computer, forget there's any computer even involved.

[00:09:33] Speaker 04:
My reading of Bandai especially is that you are looking at what's going on.

[00:09:40] Speaker 04:
And right now we are creating a database of preprocessed data.

[00:09:45] Speaker 04:
You can look at it at any given time and every value on there is current at any given time.

[00:09:51] Speaker 04:
And this leads to an advantage, Your Honors.

[00:09:54] Speaker 04:
Any moment you want to look at this thing, any moment

[00:09:58] Speaker 04:
you're going to know what the proper value of that particular property is.

[00:10:02] Speaker 04:
And with that, you can determine undervalued properties.

[00:10:05] Speaker 04:
But also, here's an advantage that I think isn't very important.

[00:10:08] Speaker 06:
I still fail to see how the fact that you can generate instantaneous valuation distinguishes this from any of these type of cases that we've held.

[00:10:17] Speaker 06:
In BuySafe, we held something like third-party guarantees that are done over the computer, which can only be done on the computer, are nonetheless

[00:10:26] Speaker 06:
an abstract idea.

[00:10:28] Speaker 06:
Isn't this the same thing?

[00:10:30] Speaker 06:
This is generating resale values, sorry, real estate valuation.

[00:10:37] Speaker 06:
Clearly a person cannot by him or herself do this because they don't have

[00:10:42] Speaker 06:
the computing power.

[00:10:44] Speaker 04:
But if I say if you had a human equivalent, you had the human analog to make that distinction.

[00:10:49] Speaker 06:
Again, how do you not have a human equivalent here of somebody setting down and gathering the information and saying, this is a real estate valuation?

[00:10:56] Speaker 06:
Humans have been making real estate valuations for hundreds of years.

[00:11:00] Speaker 04:
Yes, but they haven't made, again, if this were all about, again, every, as this court is pointing out, every claim has something abstract.

[00:11:09] Speaker 04:
This is all about the abstract part.

[00:11:10] Speaker 04:
I'm just not claiming that.

[00:11:12] Speaker 04:
I'm claiming.

[00:11:14] Speaker 04:
Providing ABM values and constantly redoing them so we have constantly refreshed values that are current.

[00:11:20] Speaker 04:
And in that way, it's different.

[00:11:22] Speaker 04:
There's no human analog.

[00:11:25] Speaker 04:
There's no evidence at that point that anybody has ever done anything like this.

[00:11:31] Speaker 06:
How is there not?

[00:11:32] Speaker 06:
Say you live in a town that has three houses and you have a real estate person that knows the real estate market so well that every single day,

[00:11:41] Speaker 06:
that person can tell you this house is worth X, this house is worth X, and this house is worth Y. Isn't that constant, up-to-date valuation?

[00:11:50] Speaker 06:
And isn't your method just doing it on a computer and using the computer power to do that on a large scale?

[00:11:58] Speaker 04:
You talked about Bandai.

[00:12:00] Speaker 04:
In this case, this isn't just a valuation.

[00:12:03] Speaker 04:
This is a special type of valuation as well.

[00:12:06] Speaker 04:
AVMs are not a substitute for

[00:12:09] Speaker 04:
for appraisals.

[00:12:11] Speaker 04:
As you pointed out in Van Dyke, there's this thing called human judgment, and the prior art was using human judgment, and where as opposed to McGraw was, or let's say that Plankton was using, McGraw was using distinct algorithms.

[00:12:27] Speaker 04:
And you say, they're not the same thing.

[00:12:29] Speaker 04:
If you have an algorithm that can replace human judgment, or if you've had evidence of that, that might be something else.

[00:12:37] Speaker 04:
But there's no evidence of that.

[00:12:40] Speaker 01:
The claims in McGraw, though, did point to specific rules and establish how those rules are used.

[00:12:47] Speaker 01:
And this is what we've been asking you.

[00:12:50] Speaker 01:
What's in this claim?

[00:12:52] Speaker 04:
the constant re-update, Your Honor.

[00:12:54] Speaker 04:
I keep going back to that.

[00:12:56] Speaker 06:
But it's very general.

[00:12:57] Speaker 06:
It has no specifics on how this is done or the like.

[00:12:59] Speaker 06:
It doesn't have a specific algorithm on how to do something.

[00:13:03] Speaker 06:
It's not like Infish, which had a specific relational database described in the specification and the patent claims.

[00:13:11] Speaker 06:
This says, you think that assuming valuation is abstract, which I think you have to, you think the patentable subject matter here is the fact that it repeatedly updates in real time?

[00:13:22] Speaker 04:
Your Honor, can you appoint anybody who's done it before?

[00:13:26] Speaker 04:
Because again, this Court's repeated holdings has it been done before.

[00:13:30] Speaker 06:
No, I think this Court's repeated holdings have not been has it done before.

[00:13:33] Speaker 06:
There's lots of things that were never possible to do before computers were invented and computer processing speeds got advanced.

[00:13:42] Speaker 06:
That doesn't render them patentable.

[00:13:44] Speaker 04:
And I am not relying on speed, Your Honor.

[00:13:46] Speaker 04:
I am relying on the algorithm.

[00:13:48] Speaker 04:
I'm relying on the specific algorithm and the way this is handled.

[00:13:51] Speaker 06:
Where is the algorithm in your claim?

[00:13:53] Speaker 04:
Repeated updates, Your Honor.

[00:13:54] Speaker 04:
That's not an algorithm.

[00:13:56] Speaker 06:
Repeated updates is not an algorithm.

[00:13:58] Speaker 06:
Is there an algorithm in any of these claims?

[00:14:02] Speaker 04:
How is it not an algorithm?

[00:14:03] Speaker 04:
I mean, it's not a mathematical computation.

[00:14:06] Speaker 04:
It's not a mathematical formula.

[00:14:07] Speaker 06:
It doesn't tell you how to do this at all.

[00:14:10] Speaker 06:
It just said repeatedly update.

[00:14:12] Speaker 04:
Yeah, and that itself is an algorithm.

[00:14:14] Speaker 02:
Was there something like a claim construction of the term automatic valuation method?

[00:14:20] Speaker 04:
Oh, yes, sir.

[00:14:21] Speaker 02:
What was it?

[00:14:22] Speaker 04:
It's a completely computer-generated valuation.

[00:14:25] Speaker 02:
Can you show me, give me a page citation for the claim construction?

[00:14:33] Speaker 01:
You're a minute into your rebuttal.

[00:14:40] Speaker 01:
I'll restore your time.

[00:14:41] Speaker 01:
Go ahead and answer the question.

[00:14:43] Speaker 01:
I just dropped this question.

[00:14:46] Speaker 04:
This is actually an entire section about the difference between AVMs and what was asserted by the patent office.

[00:14:57] Speaker 01:
What are you looking at?

[00:14:59] Speaker 02:
I'm looking for something in the board's opinion that says

[00:15:02] Speaker 02:
For purposes of our analysis, we are adopting the following claim construction.

[00:15:06] Speaker 04:
Oh, they passed it by, Your Honor.

[00:15:08] Speaker 04:
That's one of the problems with this case.

[00:15:09] Speaker 04:
They didn't even talk about it.

[00:15:11] Speaker 04:
The only standard the board used throughout was the examiner found.

[00:15:15] Speaker 04:
No law, no evidence.

[00:15:17] Speaker 04:
The examiner found was the only standard in 101, 102, 103.

[00:15:21] Speaker 02:
And you proposed to the board what claim construction for automatic valuation method?

[00:15:27] Speaker 02:
Where's that in the joint appendix?

[00:15:42] Speaker 01:
Did you propose claim construction of the terms?

[00:15:45] Speaker 04:
Oh, yes, sir.

[00:15:46] Speaker 04:
It would be great detail.

[00:15:47] Speaker 01:
That's what we're asking you about.

[00:15:49] Speaker 01:
OK.

[00:15:50] Speaker 04:
One moment, sir.

[00:16:09] Speaker 04:
OK.

[00:16:10] Speaker 04:
Page starting on 108, J.E.

[00:16:13] Speaker 04:
108.

[00:16:30] Speaker 02:
Where specifically as to the

[00:16:34] Speaker 02:
automatic valuation method and then the related question is where specifically about anything any interpretation of the term repeatedly update whether that means instantaneously constantly or just something more more just more like one more than once.

[00:16:51] Speaker 04:
We didn't even get to that your honor.

[00:16:53] Speaker 04:
Didn't even get to that point because of the conclusory nature of the board's decisions as well as the examiner's decisions.

[00:17:01] Speaker 04:
Didn't even get to that level

[00:17:03] Speaker 01:
Okay, I think we'll restore some of your time for rebuttal, but you're well into your time now.

[00:17:11] Speaker 01:
Yes.

[00:17:12] Speaker 00:
Okay.

[00:17:18] Speaker 01:
Mr. Kelly?

[00:17:28] Speaker 07:
I'll just go right to the question Judge Toronto, you asked.

[00:17:34] Speaker 07:
The board at A46 adopted the proper construction of the calendar, which was based on the standard set by the standard setting body.

[00:17:45] Speaker 07:
Page 846, which is the board's initial opinion, the beginning of the paragraph, it starts at the bottom of the page, accepting the IOCC definition.

[00:17:55] Speaker 07:
We agree with the examiner's determination that Squire's disclosure teaches AVMs.

[00:18:00] Speaker 07:
And the IOCC definition, Your Honors, is at page 315.

[00:18:04] Speaker 02:
It's not quoted in the board opinion?

[00:18:08] Speaker 06:
So we know what ABMs are, but was there any discussion of whether there's a specific definition that would further define constantly updating or flesh out how that's done?

[00:18:30] Speaker 07:
So first of all, constantly updating is not in the claim.

[00:18:33] Speaker 07:
There's been a lot of talk this morning.

[00:18:35] Speaker 07:
Repeatedly.

[00:18:36] Speaker 07:
It's repeatedly updated, which just means it has to be updated.

[00:18:41] Speaker 07:
The debate about the claim construction between the applicant and the TTO was whether or not any amount of human interaction was absolutely prohibited by the claim.

[00:18:50] Speaker 07:
That's what the board is discussing.

[00:18:53] Speaker 07:
in its opinion.

[00:18:54] Speaker 07:
And so when the board cites to the standard setting body's definition, that doesn't have any prohibition of human input.

[00:19:02] Speaker 07:
An AVM, I think, fairly in light of the standard setting body's definition is simply an automated value method.

[00:19:09] Speaker 07:
It's a way of doing with a computer what was conventionally done with a person, a professional.

[00:19:16] Speaker 01:
Is it a special type of valuation or is it just reporting market price?

[00:19:23] Speaker 07:
It's up to the modeler to train it.

[00:19:25] Speaker 07:
It's however it gets modeled.

[00:19:27] Speaker 07:
And this is what is right in the definition itself by the standard setting body.

[00:19:31] Speaker 07:
At the end of the paragraph that's 2.1.1 on page A315, the very last sentence says, credibility of an AVM is dependent upon the data used and the skills of the modeler.

[00:19:44] Speaker 07:
So essentially what an AVM is, is some sort of statistical modeling that a modeler comes up with so that they can very quickly come up with the prices of property.

[00:19:54] Speaker 02:
And you don't even mean anything fancy by statistical.

[00:19:57] Speaker 02:
They can just take all of the comparables and every new sale in the neighborhood generates a new piece of data for the comparables and you have some formula which you think is

[00:20:08] Speaker 02:
is sensible for translating comparables into a value.

[00:20:12] Speaker 02:
That would do it.

[00:20:13] Speaker 07:
Is that right?

[00:20:16] Speaker 07:
That didn't seem that complicated.

[00:20:19] Speaker 07:
Well, the most basic definition is take an old sale of the house, figure out approximately how much real estate has increased in value, and just modify it in that way.

[00:20:29] Speaker 07:
That's in the standard.

[00:20:30] Speaker 07:
So basically any model you want to call it.

[00:20:32] Speaker 01:
But you can't have fairly complex AVMs, right?

[00:20:36] Speaker 01:
For example,

[00:20:37] Speaker 01:
What is a blue house worth on a Wednesday?

[00:20:43] Speaker 07:
Yes, you could have very complicated AVMs, and the patent office is not here to suggest today that there's no innovation in the AVM space anywhere that might not be eligible.

[00:20:55] Speaker 07:
In other words, I can imagine somebody coming up with some interesting statistical method that does something in some way that has never been done before, and maybe that's eligible.

[00:21:05] Speaker 07:
I don't know, because we don't have that here today.

[00:21:07] Speaker 07:
If you look at the application itself,

[00:21:10] Speaker 07:
where Jena discusses AVMs, what you'll see is almost nothing.

[00:21:19] Speaker 02:
So at page... Yeah, where would we see almost nothing?

[00:21:30] Speaker 07:
Page 1984 of the record, paragraph 17,

[00:21:37] Speaker 07:
This is where the application begins to talk about AVMs.

[00:21:43] Speaker 07:
And what it says in the second sentence of that paragraph is, against industry trends and traditions, the inventors have invested greatly in their own AVM technology and applied it in unconventional, novel ways.

[00:21:56] Speaker 07:
There is no mention of the technology.

[00:21:59] Speaker 07:
If you skip ahead, perhaps searching for this novel AVM that they described, you can go to page 1989, which is where they come back to AVMs, at paragraph 36.

[00:22:13] Speaker 07:
The applicant is referring to the AVM device as a figure, a figure that shows box 230.

[00:22:20] Speaker 07:
and they write, this is about halfway through the paragraph, the exemplary AVM device 230 is based on a combination of heuristic and statistical technologies.

[00:22:30] Speaker 07:
However, it should be appreciated that the particular form and functionality of the AVM can vary from embodiment to embodiment as the technology evolves or otherwise can be found advantageous in various circumstances.

[00:22:45] Speaker 02:
That's it.

[00:22:45] Speaker 02:
What, if anything, is

[00:22:48] Speaker 02:
in the application about the term repeatedly updating that you suggested I think when you started that it means as long as you do it more than once that that's repeated and I think your counterpart on the other side says it means something more like constantly, instantaneously so that you have current information whenever you want it.

[00:23:15] Speaker 07:
Your Honor, I think the language of the claims replicates the specification itself.

[00:23:20] Speaker 07:
It's just that it updates the ABMs.

[00:23:23] Speaker 07:
If you look at this specification, what it talks about the invention being is the pre-population of the database.

[00:23:31] Speaker 07:
In other words, rather than have someone come and ask for an ABM and get charged $25, they're going to do it in advance so that when you go to look at a database with ABMs, they're already going to be in there for you.

[00:23:43] Speaker 07:
That's basically, as I understand it, that's what they came up with.

[00:23:48] Speaker 07:
Not how to do an AVM, but essentially when to do an AVM.

[00:23:52] Speaker 07:
And it's not just before it's asked for, it's a little bit before it's asked for, so that you don't have to calculate it on the fly, so that it's pre-calculated.

[00:23:59] Speaker 07:
That's as much as I can glean from this application, because there's nothing in this application that talks about how their AVM works.

[00:24:06] Speaker 07:
There's nothing that talks about how their computer system works, other than the generic sticking together of computers.

[00:24:11] Speaker 06:
So there's no suggestion that the patent claims an automatic update to the database every five minutes or one minute or 30 seconds or maybe a week.

[00:24:25] Speaker 07:
There certainly isn't any speed claimed, and I don't recall from the application, and perhaps Mr. Mathis can point us to it when he stands back up, I don't recall anything in the application about the speed of the update.

[00:24:38] Speaker 06:
Do you think it would make any difference?

[00:24:39] Speaker 07:
No, I don't think it would make any difference, particularly because the cache memory discussed in the prior reference says that the length of time it can be saved is up to the user themselves.

[00:24:51] Speaker 07:
So this idea of saving information and how long it can be saved, that's talked about right in the prior art reference.

[00:24:57] Speaker 07:
And I want to step back to the general inquiry we're doing here, which is eligibility and how we assess it.

[00:25:06] Speaker 07:
at the patent office and when it later comes up in courts.

[00:25:09] Speaker 07:
Because there's been a lot of discussion in the briefing about the need for some sort of level of facts, of factual showing before we can establish eligibility or ineligibility.

[00:25:20] Speaker 07:
And that's just not consistent with this court's case law.

[00:25:24] Speaker 07:
In every case that I've seen from this court, the inquiry about whether or not the invention is directed to an abstract idea or something that's eligible for patenting is an inward-looking inquiry.

[00:25:36] Speaker 07:
The idea is to figure out what they invented.

[00:25:40] Speaker 07:
To figure out the nature of the invention and what it's directed to.

[00:25:44] Speaker 07:
And whether or not there's something more in those claims that pulls an invention that's directed to an abstract idea out of the ineligibility space and ineligibility.

[00:25:53] Speaker 02:
But at the second step, obviously related to but different from the first step, there is some inquiry that the Supreme Court

[00:26:05] Speaker 02:
said had something to do with whether something is conventional.

[00:26:11] Speaker 02:
How is it not at some level a factual question?

[00:26:16] Speaker 02:
What is conventional?

[00:26:18] Speaker 02:
It may be something we can take judicial notice of.

[00:26:20] Speaker 02:
It may be something that we can look at the specification and the submission in the motion for judgment on the pleadings, the motion to dismiss the motion for summary judgment, whatever, and say, have you shown us

[00:26:33] Speaker 02:
that it is either claimed or said in the specification that it's unconventional or shown us that it's unconventional.

[00:26:41] Speaker 02:
But surely, if the question is, is it unconventional or conventional, how can that be something other than a fact question?

[00:26:50] Speaker 07:
Because, Your Honor, I don't think the question is as simple as that.

[00:26:53] Speaker 07:
It's not just, is the other stuff in the claim conventional?

[00:26:57] Speaker 07:
The question is, if you look at the limitations beyond the abstract notion of the claim,

[00:27:04] Speaker 07:
What is it that's happening with those limitations?

[00:27:07] Speaker 07:
Is it something, if there's a computer recited, is it something that's making the computer operate in a meaningfully different way?

[00:27:14] Speaker 07:
Is it something that's making the recited technology do something more than simply carry out the abstract idea?

[00:27:20] Speaker 07:
I understand the question that if there's this talk of conventionality, why is it not a question of that?

[00:27:30] Speaker 07:
And there was an argument that came up before the Supreme Court, actually in the Alice argument, where one of the justices said, well, but if we go back 40 years and the application recited doing something on a computer, it would have been patentable then, right?

[00:27:44] Speaker 07:
Because there were no computers then.

[00:27:46] Speaker 07:
So then the ineligible application becomes suddenly eligible.

[00:27:51] Speaker 07:
And what I would say to that, Your Honor, is that you can figure that out from the application itself.

[00:27:56] Speaker 07:
Because if someone invented a computer, if they invented an AVM, you could see it in the application.

[00:28:03] Speaker 07:
They would explain it.

[00:28:04] Speaker 07:
They would enable it.

[00:28:06] Speaker 07:
They would describe it.

[00:28:07] Speaker 07:
And it would be novel and not obvious.

[00:28:09] Speaker 02:
There's nothing of the type.

[00:28:11] Speaker 02:
As you know, there certainly have been

[00:28:14] Speaker 02:
questions raised about the extent to which 102, 103 inquiry is now incorporated into 101.

[00:28:22] Speaker 02:
I think what you just said is a variety of parts of 112 inquiry are now also, do we have to actually figure out if something is described, is enabled, et cetera?

[00:28:34] Speaker 07:
Well, Your Honor, what I would say that you have to figure out and what the inquiry drives us to do is to read the application in its own context and to figure out from the disclosure of the inventor what the inventive concept is.

[00:28:48] Speaker 07:
Is the inventive concept some sort of technique that makes an AVM model work better?

[00:28:53] Speaker 01:
Well, isn't the question not what the inventive concept is, it's whether there's any inventive concept expressed in the claims.

[00:29:02] Speaker 01:
That's a little bit of a different inquiry.

[00:29:07] Speaker 01:
The latter is where you would consider whether any of the steps are conventional or not.

[00:29:17] Speaker 07:
I think so, Judge Raina, but what I want to try to get away from, and maybe it's too late for all of us to get away from it, is just the collapsing of 102 and 103 with 101.

[00:29:29] Speaker 07:
Because although the language of the courts suggests conventionality is required, it suggests looking and thinking about what was known, and is the other stuff in the claim what's known?

[00:29:39] Speaker 01:
Well, I think that conventionality is something that is

[00:29:45] Speaker 01:
strictly considered in step two.

[00:29:49] Speaker 01:
I don't think you have to think that you were conflating or bringing them together.

[00:29:55] Speaker 01:
The notion of provinciality is in step two, not step one.

[00:30:01] Speaker 07:
I agree, Your Honor, and I didn't mean to suggest that anybody was trying to complain step two and step one.

[00:30:06] Speaker 07:
I was trying to speak to the question of what is necessary for the step two showing, and if what's necessary is some sort of analysis of is the other stuff in the claim already known, that feels a little bit like a factual question.

[00:30:19] Speaker 02:
Right.

[00:30:20] Speaker 02:
So I think part of what you said, and I think there's some of our opinions that at least point in this direction,

[00:30:28] Speaker 02:
is to look at what the patentee has asserted to be the advance.

[00:30:33] Speaker 02:
And you can look throughout the patent.

[00:30:34] Speaker 02:
You've got to first of all find a term in the claim that is at least potentially an asserted advance on the eligible side of the line, something that we can call technological, and then look to see if indeed there's a, you know, arguable asserted advance based on the spec that says, yeah, we actually think that we made the advance on the non-abstract

[00:30:57] Speaker 02:
side of the abstract line.

[00:31:01] Speaker 02:
We've often tended now to call that a technological advance and that you can look at the spec to do that and you don't have to decide are they right about that, namely is it in fact novel and non-obvious, but that at least is the assertion.

[00:31:15] Speaker 02:
Is that something like what you're saying?

[00:31:18] Speaker 07:
very much, Your Honor, and that is how our examiners are trained.

[00:31:21] Speaker 07:
That is what our examiner guidance has said over and over again, looking to this court's and the Supreme Court's case law for guidance, that the question is how the inventor describes the invention, how the inventor characterizes something more and what's done with it.

[00:31:36] Speaker 07:
And once an examiner goes through and makes a reasoned explanation,

[00:31:40] Speaker 07:
that puts the inventor on notice as to why there's an abstract idea there, step one.

[00:31:46] Speaker 07:
And then step two, why it is the other things in the claim don't pull it out of abstractness, but that's all an examiner has to do.

[00:31:53] Speaker 07:
So we tell the examiners, once you find out what the claim is directed to, if it's abstract, then look at the other stuff in the claim, identify the other claim limitations, and then further explain in your view why those other claim limitations are not being used by the inventor

[00:32:08] Speaker 07:
in the way you describe in the application to do something more than what a computer ordinarily does, what an output device ordinarily does.

[00:32:17] Speaker 01:
So this briefing came in before our decision in macro.

[00:32:23] Speaker 01:
But I expected that the parties were going to submit some sort of supplemental filing and either to use that case to their advantage

[00:32:32] Speaker 01:
or kind of deflect any disadvantage.

[00:32:35] Speaker 01:
We didn't get that.

[00:32:36] Speaker 01:
How do you see macro into fitting into this case?

[00:32:40] Speaker 07:
Your honor, I see it fitting in exactly the way I described all of the other cases working.

[00:32:47] Speaker 07:
What happened in McRoe is that the court looked into the specification.

[00:32:51] Speaker 07:
And that's why I thought the case was somewhat significant, only in the sense that it just followed the line of every case before it, which was it looked through the specification.

[00:33:00] Speaker 07:
It tried to figure out what was in there and whether what was in there was something more.

[00:33:05] Speaker 07:
So it's significant because it goes the other way, yes, in its outcome, but it's also significant in that it doesn't suddenly require some sort of factual showing that's above and beyond even an obviousness or anticipation showing like the aim is trying to argue.

[00:33:22] Speaker 01:
Okay.

[00:33:23] Speaker 01:
You have a question?

[00:33:24] Speaker 07:
No, that's fine.

[00:33:25] Speaker 01:
Are you sure?

[00:33:28] Speaker 01:
Yeah.

[00:33:28] Speaker 01:
Okay, thank you very much.

[00:33:32] Speaker 01:
Ms.

[00:33:32] Speaker 01:
Mathis, we'll restore you back to a minute.

[00:33:36] Speaker 04:
First of all, Your Honor, you've never claimed to have invented a new and different AVM.

[00:33:42] Speaker 04:
We're using any form of AVM because the type of AVM isn't really important.

[00:33:46] Speaker 04:
What is important is the end tool.

[00:33:49] Speaker 04:
The end tool provides specific advantage.

[00:33:52] Speaker 04:
As I discussed in front of the board, Amazon found that a tenth a second would cost them 1% of business.

[00:34:01] Speaker 04:
Two-second delay.

[00:34:02] Speaker 04:
Let's see if we can save two seconds.

[00:34:04] Speaker 06:
Can I ask you this?

[00:34:05] Speaker 06:
Let's say hypothetically, we conclude that the notion of generating and repeatedly updating an AVM value is an abstract idea.

[00:34:17] Speaker 06:
What is there in the claim that would take it out of that world?

[00:34:22] Speaker 04:
Timing.

[00:34:24] Speaker 04:
Excuse me, Your Honor.

[00:34:24] Speaker 04:
Timing.

[00:34:25] Speaker 04:
The advantages that we can provide in one of the few.

[00:34:28] Speaker 06:
I've just said, though, hypothetically, repeatedly updating is an abstract idea.

[00:34:33] Speaker 06:
That's timing.

[00:34:34] Speaker 06:
that takes care

[00:34:49] Speaker 06:
and a database.

[00:34:50] Speaker 04:
We have to go to step two, Your Honor.

[00:34:52] Speaker 04:
And step two, I want to say, because of that issue of timing, doing it before versus the doing it after, that is the difference.

[00:35:00] Speaker 04:
And that's what I think takes it.

[00:35:01] Speaker 04:
Is that something extra that means it's fattenable?

[00:35:05] Speaker 01:
Okay, I think we have your argument, Counselor.

[00:35:08] Speaker 01:
Thank you very much.

[00:35:09] Speaker 04:
Okay.

[00:35:10] Speaker 04:
Thank you, Your Honor.