[00:00:19] Speaker 00:
Next case is money cap versus eBay

[00:00:45] Speaker 00:
2016, 1399, 1405, and 1408.

[00:00:48] Speaker 00:
Mr. Wisniew.

[00:00:49] Speaker 00:
Thank you, Your Honor.

[00:00:58] Speaker 04:
Howard Wisniew for Appellant Money Cat may please the court.

[00:01:01] Speaker 04:
The board in this case made four errors in holding the Money Cat patents obvious under Section 103.

[00:01:07] Speaker 04:
First, the board erred by summarily concluding that the combinations asserted rendered obvious the entire claim

[00:01:14] Speaker 04:
without actually making any factual finding or finding that the combinations meet the full accessing limitation of claim one.

[00:01:22] Speaker 04:
That's item 1G that's in the claim charts.

[00:01:24] Speaker 04:
In fact, eBay itself had failed to even present arguments below supporting such a finding.

[00:01:30] Speaker 04:
Second, the board failed to recognize that the proposed combinations that it relied upon would violate the principle of operation of the APA net cash.

[00:01:39] Speaker 04:
In other words, it would change it in a way that would violate the principle of operation.

[00:01:43] Speaker 04:
And third, the board failed to recognize that eBay's repeated changing and modifying of its theories of invalidity in this case is diagnostic of impermissible hindsight.

[00:01:54] Speaker 04:
And finally, the board erred in relying on admitted prior art in a CBM proceeding because it is outside the limited scope of the statute.

[00:02:01] Speaker 04:
for which CBM proceedings may proceed.

[00:02:05] Speaker 00:
How can it be outside the scope of the statute?

[00:02:08] Speaker 00:
It's prior art.

[00:02:10] Speaker 00:
Prior art under 102, 103.

[00:02:12] Speaker 00:
That's certainly within the statute.

[00:02:16] Speaker 04:
Your Honor, I think that's the exact question, which is whether or not admitted prior art qualifies as prior art under section 102A.

[00:02:21] Speaker 00:
Well, we can, aside from the admission,

[00:02:25] Speaker 00:
in the patent, we can read that it is a publication.

[00:02:32] Speaker 00:
It has a title, page number, authors, and an indication of its content.

[00:02:41] Speaker 01:
In support of your argument on this, you have two citations of authority.

[00:02:47] Speaker 01:
You cite to a PTAB order that doesn't discuss admitted prior art.

[00:02:54] Speaker 01:
Meridian Link and the Riverwoods case from this court that is the TPAP PTAB found and you can see it in your brief only holds that admitted prior art quote does not necessarily qualify as prior art under 102 in certain cases and none of those cases are directly applicable here.

[00:03:16] Speaker 01:
So do you have any other support for this proposition?

[00:03:18] Speaker 04:
I do not have other cases but what I would say is if we look at the statute and the reason we cited the Meridian case

[00:03:24] Speaker 04:
is that even the PTAB recognizes that the statute does not even include all of what we would normally consider statutory prior art.

[00:03:31] Speaker 04:
It excludes 102E prior art.

[00:03:33] Speaker 04:
This is a transitional proceeding, effectively a congressional experiment, is what CBMs are.

[00:03:39] Speaker 04:
And so for whatever the reasons are, the statute is written to limit it.

[00:03:42] Speaker 00:
So the question, I think... But this isn't 102E prior art.

[00:03:46] Speaker 04:
I agree with you, Your Honor.

[00:03:47] Speaker 04:
The question is whether or not admission qualifies as a 102A

[00:03:52] Speaker 04:
prior event it does refer to publications I agree with you but the petition is not based on the publication that's a decision that eBay made because they had filed multiple re-examination request in the past in which they relied on these net cash publications they were concerned I propose

[00:04:10] Speaker 04:
that the Patent Office would reject the petitions as being redundant of previous attempts in the reexamination.

[00:04:17] Speaker 04:
So they took a shot.

[00:04:18] Speaker 04:
They said, OK, instead of using those publications that we failed with multiple times, we'll try something new.

[00:04:24] Speaker 04:
And they relied on the admitted prior art.

[00:04:26] Speaker 02:
But even if that's what they said, the board can still look at the actual printed publications campaign.

[00:04:34] Speaker 04:
I don't know if I would agree, but in this case, the board didn't.

[00:04:38] Speaker 04:
There's no finding that the board actually based its decision on the underlying publications.

[00:04:43] Speaker 04:
And so I don't think in this particular case it's relevant, because the factual record shows that they did not do it.

[00:04:49] Speaker 02:
Let's assume they did.

[00:04:51] Speaker 02:
Do you think there's error in the board initiating this or calling their argument that the prior art is an admission?

[00:05:00] Speaker 02:
And then the board went ahead and said, well, maybe we can't look at it as an admission, but there's actual printed documents.

[00:05:06] Speaker 04:
If they had done that in the institution decision, there perhaps would have been a procedural error.

[00:05:10] Speaker 04:
I don't know.

[00:05:11] Speaker 04:
It may have been that if we had an opportunity to respond on that basis, that we may have.

[00:05:19] Speaker 02:
I'm not sure you're answering my question.

[00:05:21] Speaker 02:
I'm assuming the board here actually did base its decision on the printed publications and not the admission.

[00:05:28] Speaker 04:
Oh, I understand.

[00:05:28] Speaker 02:
Is there error in that?

[00:05:30] Speaker 04:
If they, in fact, based it on the publication, I would say it's error, because we were not given a fair notice.

[00:05:34] Speaker 04:
that they were in fact doing it based on the publication.

[00:05:37] Speaker 02:
And I think if you look at the final written decision, did you not have a chance to respond to the prior art and whether it showed these limitations?

[00:05:50] Speaker 04:
If we were put on notice, then we would have had an opportunity to address those particular limitations.

[00:05:54] Speaker 01:
You were not aware it existed.

[00:05:56] Speaker 04:
I certainly was aware that it existed.

[00:05:57] Speaker 04:
I was not aware that until this question was asked just moments ago that anyone

[00:06:01] Speaker 04:
had suggested that they were relying on the underlying printed publication.

[00:06:05] Speaker 02:
But they were relying on the system.

[00:06:08] Speaker 02:
I mean, you were arguing about whether the system described there discloses the limitations or not, right?

[00:06:15] Speaker 04:
I would say that we were arguing whether or not figure two and columns two and three of the 602 patent that are describing certain things meet or do not meet the requirements of the claim.

[00:06:26] Speaker 02:
Is there any difference between that and the printed publications?

[00:06:31] Speaker 04:
There may or may not be, Your Honor.

[00:06:33] Speaker 04:
There's further discussion in the publications.

[00:06:37] Speaker 04:
But the point that I guess we're making is whether or not admitted prior art.

[00:06:41] Speaker 04:
A discussion of an event is not itself the event.

[00:06:46] Speaker 04:
So they're the master of their own petition.

[00:06:49] Speaker 04:
They could have, if they chose to, relied on the underlying publication.

[00:06:52] Speaker 04:
They chose not to do it.

[00:06:54] Speaker 04:
And I think given the estoppel provisions of CBMs,

[00:06:58] Speaker 04:
It's important that we have a clear line as to what has been used and what has not been used.

[00:07:03] Speaker 04:
For example, if we were to prevail here, could they go back to the district court and say, oh, by the way, now I'm going to rely on the USC system.

[00:07:10] Speaker 04:
Now I'm going to go rely on that publication that's in section that's in column two, because that really wasn't part of the proceedings below.

[00:07:17] Speaker 04:
I think it would inject an ambiguity into the estoppel provision.

[00:07:20] Speaker 04:
Unless there's further questions on that, I would move on to accessing.

[00:07:24] Speaker 04:
So the final written decision in this case contains no finding

[00:07:28] Speaker 04:
that a currency issuing authority server acts as a first user database packet, first user data packets in an active data packet area associated with the first user.

[00:07:40] Speaker 04:
E-Bail fails to refute it and identifies some finding in the final written decision that does it.

[00:07:44] Speaker 04:
The closest that they come is they have a quote on page 36 of the final written decision in which the board repeats an argument that eBay had made.

[00:07:53] Speaker 04:
It says, quote, the middleman currency server accesses the first user's net cash coins

[00:07:59] Speaker 04:
to verify that the coins are authentic and have not been previously used to affect payment.

[00:08:04] Speaker 04:
That isn't good enough.

[00:08:05] Speaker 04:
It doesn't meet it.

[00:08:05] Speaker 04:
First, the board, in fact, didn't adopt that finding.

[00:08:08] Speaker 04:
There's no statement that they're adopting the argument of e-betting.

[00:08:12] Speaker 04:
And they did not effectively or implicitly adopt the argument because there's no reasoned explanation.

[00:08:16] Speaker 04:
As this court recently held in the Nuvasiv case, you cannot have an effective adoption without an explicit adoption or at least some sort of reasoned explanation

[00:08:28] Speaker 04:
as to why you were adopting one argument and refuting another one.

[00:08:32] Speaker 04:
Second, even if we rely on that portion, it still doesn't meet the where part of the limitation.

[00:08:38] Speaker 04:
That is, it doesn't identify in an active data packets area associated with the first user.

[00:08:44] Speaker 04:
And third, if we take a look at the figure that eBay's expert put together in his deposition that was kind of the basis of this combination, that's a figure that's reproduced at page 12 of the reply.

[00:08:56] Speaker 04:
We can see that the theory that they actually relied upon excludes the possibility that it would meet this limitation.

[00:09:03] Speaker 04:
What happens in that figure is the buyer transmits some sort of coin to the broker and the broker sends it to the currency server.

[00:09:10] Speaker 04:
That's what they claim to be the CIAS in this case.

[00:09:14] Speaker 04:
But the claim requires that the CIAS access into the active data packets area.

[00:09:20] Speaker 04:
It's not that it's receiving it, it's accessing it and they have not even suggested that they are meeting that limitation.

[00:09:27] Speaker 04:
So the board didn't find it.

[00:09:28] Speaker 04:
eBay didn't argue it.

[00:09:30] Speaker 04:
And furthermore, the board could not have made such a finding.

[00:09:33] Speaker 04:
First, the board is limited under the Magnum oil case to actually adjudicating the arguments the petitioner puts forth.

[00:09:39] Speaker 04:
They can't come up with their own arguments.

[00:09:43] Speaker 04:
And if we take a look at eBay's petition, we say that they did not address this limitation fully.

[00:09:49] Speaker 04:
So the only information they put in on this limitation is in their claim chart in the petition.

[00:09:55] Speaker 04:
That's an A356 in the record.

[00:09:59] Speaker 04:
And in addressing the limitation by the TerraMora or the Bernstein reference, they failed to identify how the CIS in such a system would be accessing an active data packets area, how that active data packets area would be associated with the first user.

[00:10:13] Speaker 04:
They simply don't do it right.

[00:10:16] Speaker 04:
Unless there's questions on that, I will move on to the next point.

[00:10:22] Speaker 04:
Principle of operation.

[00:10:24] Speaker 04:
I think perhaps the clearest way to see this is we compare column three of the patent, which is at A241.

[00:10:32] Speaker 04:
And this is the admitted prior art section.

[00:10:39] Speaker 04:
At column three it says, the currency server is trusted not to record to whom the coins are issued.

[00:10:45] Speaker 04:
The currency server does not know who is exchanging coins.

[00:10:48] Speaker 04:
Only the network addresses where they are coming from.

[00:10:51] Speaker 01:
What, in your view,

[00:10:53] Speaker 01:
makes an aspect of prior art a principle of operation and what evidence can you point to here for us to find that anonymity was a principle of operation in this case?

[00:11:05] Speaker 04:
Well, there is no, the board suggested it was just one of the goals and it wasn't the principle of operation.

[00:11:10] Speaker 04:
There is no other goal that is described in the omitted prior art.

[00:11:14] Speaker 04:
Anonymity is repeatedly referred to in columns two and three, which is the omitted prior art here.

[00:11:19] Speaker 04:
And in fact, if we read it, the portion that we just talked about that,

[00:11:23] Speaker 04:
One of the important aspects of it is that the currency server does not know who's getting the coins, who has the coins, who the coins are being transmitted to.

[00:11:30] Speaker 04:
So I think a fair reading of this is only that anonymity is a key or principal aspect of the net cash operation.

[00:11:40] Speaker 04:
If we compare that to what Dr. Newman did, eBay's expert in this case, and again, if you look at the figure that's at page 12 of the reply, you could see that now,

[00:11:50] Speaker 04:
Because the currency server has to take the coin from one entity or one memory and deliver it to a different memory, it needs to know who's coming and who's going.

[00:11:58] Speaker 04:
It needs to have an identification of where the coin is for the first user and who the coin is going to go to for the second user.

[00:12:05] Speaker 04:
That completely destroys the principle of operation and this anonymity and this direct teaching in column three that we just discussed.

[00:12:15] Speaker 04:
Finally, I want to talk about hindsight for a moment.

[00:12:19] Speaker 04:
There's some confusion in the briefing as to whether or not we're making a procedural argument with respect to the changing of the theory.

[00:12:26] Speaker 04:
We do think there's procedural issues, but really the heart of our argument is that this is diagnostic itself of hindsight.

[00:12:33] Speaker 04:
In almost every obviousness case, we do a thought experiment, and we say, hypothetically, what would have happened at the time of the invention?

[00:12:40] Speaker 04:
Here, we're in an unusual situation where we have empirical evidence of what a person where we're scaling on would actually have done.

[00:12:47] Speaker 04:
They came up with a combination that does not meet the claim.

[00:12:50] Speaker 04:
That is what Dr. Newman did and hid the petition in this case.

[00:12:53] Speaker 04:
They only modified it based on feedback that they received from the inventor in this case.

[00:12:57] Speaker 04:
So not only did they have the prior art hanging on the wall, as we would talk about in the old cases, they actually had the invention hanging on the wall there next to them.

[00:13:05] Speaker 04:
And they could not put the prior art together in a manner that would meet the claim.

[00:13:09] Speaker 00:
Counsel, you wanted to save five minutes.

[00:13:11] Speaker 00:
You're well into rebuttal.

[00:13:12] Speaker 00:
Thank you.

[00:13:13] Speaker 00:
You can continue, or we'll save it.

[00:13:14] Speaker 04:
Thank you.

[00:13:15] Speaker 04:
I would save it.

[00:13:17] Speaker 00:
Mr. Wobrow.

[00:13:25] Speaker 03:
Good morning, Your Honors.

[00:13:26] Speaker 03:
Thank you.

[00:13:27] Speaker 03:
May it please the court?

[00:13:28] Speaker 03:
If I may, I'll go down the list of the issues that were raised by the appellant and address them in turn.

[00:13:35] Speaker 03:
The first being the question of whether there are findings on the question of whether the prior art combination

[00:13:43] Speaker 03:
Discloses and teaches the accessing requirement and clearly in the record.

[00:13:47] Speaker 00:
Why don't you first address the question?

[00:13:50] Speaker 00:
Admitted prior art certainly.

[00:13:54] Speaker 03:
Thank you your honor on the admitted prior art the board was very clear the board took the admissions that were in the path and

[00:14:03] Speaker 03:
and said that those admissions themselves are enough to evidence a prior art system.

[00:14:08] Speaker 03:
There was an admission that the system, net cash, was prior art.

[00:14:13] Speaker 03:
That's what it says.

[00:14:13] Speaker 03:
It's a prior art system is admitted.

[00:14:16] Speaker 03:
it is admitted that it was known in this country.

[00:14:19] Speaker 03:
Why?

[00:14:19] Speaker 03:
Because the patent itself admits that it was developed at the University of Southern California.

[00:14:24] Speaker 03:
That's where net cash was developed.

[00:14:26] Speaker 00:
Does the disclosure in the patent itself constitute enough information to render the invention obvious?

[00:14:36] Speaker 03:
Yes, it does.

[00:14:38] Speaker 03:
In combination, yes, in combination it does.

[00:14:41] Speaker 03:
Absolutely so.

[00:14:42] Speaker 03:
What the combination is is taking those other references that disclose middlemen, brokered operations, and combines it with the currency server, which has been admitted to be a prior art system that was known in this country.

[00:14:56] Speaker 03:
We know it was known in this country because it was developed.

[00:14:58] Speaker 03:
The evidence of how the system worked are the admissions in the patent about how the prior art worked.

[00:15:04] Speaker 03:
And so those admissions about the operation of the system, not only number one,

[00:15:09] Speaker 03:
evidence the existence of the prior art system as 102A art, that is, a system that was known in this country, but also, too, from the evidentiary standpoint, describe how it works and what it teaches.

[00:15:21] Speaker 03:
And those teachings are sufficient.

[00:15:22] Speaker 00:
But your opposing counsel says this isn't the type of prior art encompassed by the statuary.

[00:15:27] Speaker 03:
I disagree.

[00:15:28] Speaker 03:
102A prior art is encompassed.

[00:15:31] Speaker 03:
The board found that the admissions themselves were sufficient to demonstrate the existence of a

[00:15:38] Speaker 03:
prior art system, one known in this country.

[00:15:41] Speaker 03:
Those were the findings of the board, and they're fully supported by what's set forth in the patent.

[00:15:46] Speaker 00:
Was that something known in this country or a printed publication?

[00:15:49] Speaker 03:
It was known in this country.

[00:15:51] Speaker 03:
We know it was developed based upon what the patent says, that it was a prior art system that was developed at the University of Southern California.

[00:15:58] Speaker 03:
It also says that it was described in printed publications.

[00:16:01] Speaker 03:
That's an optional, an additional thing, another way to meet the 102A requirements.

[00:16:06] Speaker 03:
So the way that the board looked at this and the way the admissions are written, it basically tracks the statute of 102A.

[00:16:12] Speaker 03:
Was it something in the prior art?

[00:16:15] Speaker 03:
Yes.

[00:16:16] Speaker 03:
Was it known in this country?

[00:16:17] Speaker 03:
Yes.

[00:16:17] Speaker 03:
Was it described in printed publications?

[00:16:19] Speaker 03:
Yes.

[00:16:19] Speaker 03:
It ticks all the boxes, and the board made that finding.

[00:16:22] Speaker 03:
And we submit that what's in the patent is sufficient.

[00:16:25] Speaker 03:
On the question of the findings regarding accessing, if I can turn to that, the argument that is being made by the appellant

[00:16:33] Speaker 03:
Essentially misapprehends the combination that was proposed below and the combination that was found by the board to render the claims obvious the combination takes the middleman server and the functions that the middleman performs and Combines those and that was said in many ways they co-locates them combines them adapts them

[00:16:54] Speaker 03:
and takes the currency server and those things effectively work together to perform the functions of the CIAS, the currency issuing authority, and the so-called trusted server.

[00:17:06] Speaker 03:
That's what's performing these operations.

[00:17:08] Speaker 03:
Now, the board made specific findings in support of the accessing requirement, and they're simply being overlooked by the appellant.

[00:17:16] Speaker 03:
One finding that was specifically made was that

[00:17:20] Speaker 03:
In the Terra Mora context, that's one of the pieces of priority.

[00:17:24] Speaker 03:
In Terra Mora, there was a specific finding that the broker there receives the electronic coins from the buyer.

[00:17:33] Speaker 03:
And it temporarily stores them.

[00:17:36] Speaker 03:
It temporarily stores them.

[00:17:38] Speaker 03:
It then, under the combination, turns them over to the currency server.

[00:17:42] Speaker 03:
So what it's doing is it's temporarily storing them.

[00:17:46] Speaker 03:
And then when it's time to swap them, it goes into the memory.

[00:17:50] Speaker 03:
and takes the coins out and gives them to the currency server, where they are then exchanged.

[00:17:55] Speaker 03:
That's the combination that the board found.

[00:17:58] Speaker 03:
And the findings in support of that include the final written decision at page 30, which is appendix 30 here, where it specifically says it's stored.

[00:18:07] Speaker 03:
And then you go in, and you retrieve them.

[00:18:10] Speaker 03:
Now, when you retrieve them.

[00:18:11] Speaker 01:
But Mr. Bober, you're arguing the submitted prior art to us.

[00:18:17] Speaker 01:
But when Judge Laurie asked his first question, you didn't say,

[00:18:20] Speaker 01:
Well, you don't have jurisdiction to consider that.

[00:18:23] Speaker 01:
Are you running away from your argument about that?

[00:18:27] Speaker 03:
I'm sorry, Your Honor.

[00:18:28] Speaker 03:
Jurisdiction to consider the admitted priority?

[00:18:30] Speaker 03:
Yeah.

[00:18:31] Speaker 03:
No, I'm not, Your Honor.

[00:18:32] Speaker 03:
The point on the accessing is simply that.

[00:18:36] Speaker 03:
How do you deal with Versada?

[00:18:39] Speaker 03:
Oh, yes.

[00:18:41] Speaker 03:
Your Honor, on that question, I apologize that I misunderstood the context.

[00:18:45] Speaker 03:
You know, in light of the Husky decision following Quozo, we would no longer advance the argument.

[00:18:52] Speaker 03:
I apologize.

[00:18:53] Speaker 03:
I misunderstood your question.

[00:18:55] Speaker 03:
So with respect to the findings, our point simply is that there were findings that were made by the board that both in the context of Terra Mora with the admitted prior art and Bernstein with the admitted prior art,

[00:19:08] Speaker 03:
The brokers or intermediaries in both of those situations, there were findings made that the electronic cash or the funds are stored, they are then retrieved, and then they are transferred, swapped, paid.

[00:19:21] Speaker 03:
That's what the combination is.

[00:19:23] Speaker 03:
And by virtue of storing and retrieving, that is necessarily a finding of accessing.

[00:19:30] Speaker 03:
and a finding of accessing in a data packets area associated with the user.

[00:19:36] Speaker 03:
Why?

[00:19:37] Speaker 03:
Because you have to find those coins that are in memory.

[00:19:41] Speaker 03:
You have to find the coins that are in the account.

[00:19:43] Speaker 03:
You have to find the coins that are being stored.

[00:19:46] Speaker 03:
You find them, you retrieve them, and you give them to the currency server to swap.

[00:19:51] Speaker 03:
By making all of those findings, the board clearly found that the currency is being accessed.

[00:19:58] Speaker 03:
And it is being accessed in an area that is associated with the user.

[00:20:02] Speaker 03:
Those are the user's coins.

[00:20:04] Speaker 03:
They're being held in escrow.

[00:20:05] Speaker 03:
They're being held by an agent.

[00:20:07] Speaker 03:
That is sufficient finding to, and the board made those findings below.

[00:20:13] Speaker 01:
Mr. Robert, before you move here next, your opposing counsel on his blue brief and just now an oral argument repeats that eBay lost on some prior

[00:20:28] Speaker 01:
IPR proceedings.

[00:20:30] Speaker 01:
Do those have any bearing at all on the case?

[00:20:32] Speaker 03:
They don't.

[00:20:33] Speaker 03:
Those are re-examination proceedings, procedurally.

[00:20:36] Speaker 03:
On the merits of them, they have no implications or relevance to the proceeding.

[00:20:41] Speaker 03:
Why?

[00:20:42] Speaker 03:
Because the combinations that were involved there are not the ones here.

[00:20:46] Speaker 03:
The Terra Mura reference was not an issue there, and the Bernstein reference was not an issue there.

[00:20:52] Speaker 03:
And the combinations that were presented to the board here are new and not previously considered.

[00:20:59] Speaker 03:
Turning then to the argument about the principle of operation, the argument seemed to be that there was, with respect to the admitted prior art, that in some way that the combination violated a principle of the prior art with respect to anonymity.

[00:21:15] Speaker 03:
And what I heard counsel say, and the best I could really hear, was that in some way anonymity was a goal of the net cash system and that that goal was not being addressed.

[00:21:26] Speaker 03:
So let me respond to that in two ways.

[00:21:28] Speaker 03:
First of all, to the extent that it is relevant at all as a principle.

[00:21:32] Speaker 03:
I think you used the phrase principle of operation.

[00:21:35] Speaker 03:
Yes, indeed.

[00:21:36] Speaker 03:
And with respect to that, and with respect to, first let me just address straight up that the combination, the combined system, works in the same way.

[00:21:47] Speaker 03:
And that's what the board found.

[00:21:50] Speaker 03:
The way that the net cash server worked in the prior art was

[00:21:55] Speaker 03:
An entity, in that case, in one example of it, a seller, gave coins to the currency server.

[00:22:01] Speaker 03:
The currency server then swaps the coins and spits back out new coins.

[00:22:07] Speaker 03:
And it gives them to the same entity that it received them from.

[00:22:10] Speaker 03:
That's exactly how the net cash currency server is working in the combinations on which the board found these patents unpatentable.

[00:22:19] Speaker 03:
In the combined system, you have either Terra Moro or Bernstein providing broker functions.

[00:22:24] Speaker 03:
That broker is integrated with a currency server.

[00:22:29] Speaker 03:
The broker passes the coin that it has retrieved from its memory, and it passes those coins to the currency server.

[00:22:37] Speaker 03:
The currency server swaps those, and it sends them back to the broker function.

[00:22:42] Speaker 03:
So we have a broker server that's been integrated with a currency server, and that is working in the exact same way as the net cash system.

[00:22:52] Speaker 03:
The coins are swapped and given back to the same entity that they were received from.

[00:22:56] Speaker 03:
In addition, I submit that as the board properly found, no principle of operation is in play here.

[00:23:04] Speaker 03:
The net cash currency server works in the same way as combined as it did in the prior art.

[00:23:09] Speaker 03:
What does that currency server do?

[00:23:11] Speaker 03:
It receives coins.

[00:23:13] Speaker 03:
It looks up to see whether they are still valid or whether they've been spent.

[00:23:17] Speaker 03:
It marks them one way or the other.

[00:23:19] Speaker 03:
And then it exchanges new electronic currency in place of the old currency.

[00:23:23] Speaker 03:
It's doing the exact same thing.

[00:23:26] Speaker 03:
Whether or not anonymity is at play here, as the portion of the patent that counsel read shows, anonymity was at best only partially supplied by the net cash system.

[00:23:39] Speaker 03:
because it did receive information about the entity that was supplying the coins to it, namely network information.

[00:23:47] Speaker 03:
So it's not as though it was an anonymous system.

[00:23:49] Speaker 03:
That was simply one aspect or one sort of goal, as the board found below, a goal of the system.

[00:23:57] Speaker 03:
Finally, with respect to the argument about hindsight, the Council has now clarified that the

[00:24:08] Speaker 03:
He said he wasn't abandoning.

[00:24:10] Speaker 03:
Well, fair enough.

[00:24:12] Speaker 03:
But what I understood the gist to be was that error was not being assigned to the admission below of the reply brief or the reply declaration.

[00:24:22] Speaker 03:
Rather, the assignment of error was to an argument that somehow the board was using hindsight to

[00:24:32] Speaker 03:
invalidate as obvious the claims because it was sort of taking these teachings from reply which it said were new teachings not in the petition and somehow learning from that and therefore applying hindsight.

[00:24:45] Speaker 03:
So let me address that in several ways and I think the most important way to address it is to say that the entire premise of the argument is wrong.

[00:24:54] Speaker 03:
The premise of the argument is that the information that was submitted in reply is new and it is not new.

[00:25:02] Speaker 03:
The information that's allegedly new includes, number one, that in the combination there would be an internal, what's been called an internal coin swap, where the currency server takes the coins from the broker and spits them back to the broker.

[00:25:18] Speaker 03:
That was alleged to be new in reply, but it's not.

[00:25:22] Speaker 03:
And I would cite the court to appendix pages 366 and 367 by way of example.

[00:25:28] Speaker 03:
And there, when the Bernstein combination was being proposed in the petition, not the reply, but in the petition, the argument was made that it would have been obvious to adapt the intermediary, which in Bernstein is a financial institution or agent, to include a currency issuing capability of the admitted prior art net cash system, quote, to confirm the authenticity of the first user's electronic coins, mark them spent,

[00:25:58] Speaker 03:
and to transfer a new set of coins to a second party.

[00:26:03] Speaker 03:
That was what was being described, taking the coins in from the buyer, marking them spent, and transferring a new set of coins to a second party.

[00:26:12] Speaker 03:
The argument is premised on the notion that that argument was first made in reply, and it wasn't.

[00:26:18] Speaker 03:
It was squarely in the opening petition and also in Dr. Newman's declaration at appendix page 1301.

[00:26:26] Speaker 03:
in support of the petition, his opening declaration made the same theory.

[00:26:31] Speaker 03:
The board never said this was a new theory.

[00:26:35] Speaker 01:
Whenever it was being addressed below by the board.

[00:26:37] Speaker 03:
Didn't they say, well, this was in reply to something you raised for the first time?

[00:26:40] Speaker 03:
What they said about the coin swap was whenever they addressed it below, they put quotes around the word new.

[00:26:46] Speaker 03:
And then they went on to say, at appendix page 41, that this was an elaboration that was being provided, not that it was a new theory.

[00:26:55] Speaker 03:
Secondly, the argument is being made that the reference that was being supplied that taught doing an internal coin exchange, an internal coin swap, the Simon reference, the argument was made in the briefs by the appellant that somehow Simon was first identified as providing that coin swapping function in reply.

[00:27:15] Speaker 03:
And once again, that's simply not true.

[00:27:17] Speaker 03:
I would cite the court to appendix page 1251.

[00:27:21] Speaker 03:
And at that page, 1251 of the appendix, this is Dr. Newman's opening declaration.

[00:27:26] Speaker 03:
And he said, quote, that Simon teaches, quote, indirect payments through a middleman in which the middleman, which is the bank in the Simon reference, exchanges the buyer's currency for new currency issued to the vendor based upon instructions from the buyer.

[00:27:44] Speaker 03:
So it takes the buyer's coins and it exchanges the buyer's currency for new currency.

[00:27:51] Speaker 03:
That was how Simon was being described.

[00:27:54] Speaker 03:
Simon had multiple embodiments, and those multiple embodiments were described below in the papers in support of the petition.

[00:28:01] Speaker 03:
But certainly that aspect of it was described.

[00:28:04] Speaker 03:
In addition, in the petition, the petition cited two portions of Simon that teach doing that internal currency swap.

[00:28:13] Speaker 03:
Namely, Simon at column 8, lines 5 to 57, which I believe is at

[00:28:21] Speaker 03:
The sites to those were at pages of the appendix 353, 368, 1278, and 1303.

[00:28:29] Speaker 03:
So there was ample evidence to show that this period was not new and that hindsight simply wasn't used.

[00:28:37] Speaker 03:
All of this was in the prior art.

[00:28:39] Speaker 03:
Thank you, Your Honors.

[00:28:39] Speaker 00:
Thank you, Counsel.

[00:28:41] Speaker 00:
Mr. Wisner has 240 for a bottle if you need it.

[00:28:47] Speaker 04:
Thank you, Your Honor.

[00:28:50] Speaker 04:
There's a fundamental misunderstanding with respect to the accessing requirement.

[00:28:53] Speaker 04:
A broker sending on unsolicited coins to the CIAS is not a CIAS accessing the data packets.

[00:29:02] Speaker 04:
If you take a look, for example, at column 15 of the patent, the 602 patent, which is at A247, it says, whenever it is stated that the CIAS accesses data on an active currency storage area, it should be understood that this also includes a situation

[00:29:20] Speaker 04:
which the user transfers the data representative of the electronic currency to the CIS, and the CIS only requests that the transfer be made without actually gaining access to and withdrawing the data.

[00:29:30] Speaker 04:
So there's only two examples given.

[00:29:32] Speaker 04:
Accessing is either the normal use, you go, grab it, you withdraw it from the location, or you send a request, you instruct the memory to send it back.

[00:29:41] Speaker 04:
This has to do with some of the principles of the 602 patents operation, which is specifically because you want to be able to

[00:29:49] Speaker 04:
operate the system in a particular way, the CIIS has to be in charge.

[00:29:53] Speaker 04:
It has to be the master of the system.

[00:29:55] Speaker 04:
And therefore, when you put this combination together where the broker is just passively sending on the coins, it does not meet the requirement of accessing.

[00:30:04] Speaker 04:
Secondly, even in counsel's discussion here, he talks about this very point.

[00:30:08] Speaker 04:
He says, well, you know, the currency server receives the coins.

[00:30:12] Speaker 04:
There's also some mischief going on with the term entity in this case.

[00:30:16] Speaker 04:
When they talk about

[00:30:17] Speaker 04:
the prior art, which is figure two in the 602 patent, it's very clear that the address, the particular entity or item that is sending up the coin is the one that's getting the new coin back.

[00:30:29] Speaker 04:
It is analogous to me going into the 7-11 and saying to the cashier, I have a 20, would you give me two 10s in return?

[00:30:34] Speaker 04:
She doesn't need any identification from me.

[00:30:36] Speaker 04:
She doesn't need to know any information about me.

[00:30:38] Speaker 04:
That's entirely different from the modified system that they put together.

[00:30:42] Speaker 04:
Where basically what happens is you give someone $20 and say, someone else is going to come in.

[00:30:46] Speaker 04:
His name is Bob.

[00:30:47] Speaker 04:
Would you give him this $20 for me?

[00:30:49] Speaker 04:
That is entirely different.

[00:30:50] Speaker 04:
And in their combinations, they're not meeting that at all.

[00:30:55] Speaker 04:
We describe in our opening brief at page 46 how the new theories are significantly different in the reply than they were in the opening session.

[00:31:05] Speaker 04:
They claim in the original petition that net cash is unchanged.

[00:31:08] Speaker 04:
We see in the figure that's reproduced in the reply at page 12, it has to be changed.

[00:31:12] Speaker 04:
You're not sending the coin back to the same location.

[00:31:14] Speaker 04:
You have to send it to a different location.

[00:31:16] Speaker 04:
They had reasons to combine the references that had nothing to do with double spending.

[00:31:21] Speaker 04:
Their reasons would not have addressed whether or not you send the coin before or after the transaction.

[00:31:26] Speaker 04:
You could send them either.

[00:31:29] Speaker 04:
I see my time has expired.

[00:31:30] Speaker 04:
Thank you so much.

[00:31:31] Speaker 00:
It has been spent.

[00:31:34] Speaker 00:
Thank you, Mr. Wisney.

[00:31:35] Speaker 00:
We'll take a face-on revisement.