In Re Transaction Holdings Ltd., LLC

NOTE: This disposition is nonprecedential.
United States Court of Appeals
for the Federal Circuit
__________________________
(Reexamination No. 90/008,323)
IN RE TRANSACTION HOLDINGS LTD., LLC
__________________________
2011-1361
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Appeal from the United States Patent and Trademark
Office, Board of Patent Appeals and Interferences.
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AUTOMATED TRANSACTIONS, LLC,
Plaintiff-Appellant,
v.
IYG HOLDING CO., 7-ELEVEN, INC.,
VCOM FINANCIAL SERVICES, INC.,
AND CARDTRONICS USA, INC.,
Defendants-Appellees.
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2011-1492
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Appeal from the United States District Court for the
District of Delaware in Case No. 06-CV-0043, Judge Sue
L. Robinson.
IN RE TRANSACTION HOLDINGS 2
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Decided: April 23, 2012
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ALBERT L. JACOBS, JR., Tannenbaum Helpern Syra-
cuse, of New York, New York, argued for appellant and
plaintiff-appellant in appeals 2011-1361 and 2011-1492.
With him on the brief was GERARD F. DIEBNER. Of coun-
sel on the brief was DANIEL A. LADOW, Troutman Sanders
LLP, of New York, New York.
DONALD R. DUNNER, Finnegan, Henderson, Farabow,
of Washington, DC, argued for defendants-appellees in
appeal no. 2011-1492. With him on the brief were KARA
F. STOLL and GARTH D. BAER.
LYNNE E. PETTIGREW, Associate Solicitor, United
States Patent & Trademark Office, of Alexandria, Vir-
ginia, argued for appellee in appeal no. 2011-1361 With
her on the brief were RAYMOND T. CHEN, Solicitor and
FRANCES M. LYNCH, Associate Solicitor.
__________________________
Before BRYSON, SCHALL, and PROST, Circuit Judges.
BRYSON, Circuit Judge.
These two related cases were argued together, and we
address them together. Automated Transactions, LLC,
the appellant in the first case, No. 2011-1361, is related to
Transaction Holdings Ltd., LLC, the appellant in the
second case, No. 2011-1492. We refer to them collectively
as “ATL.”
3 IN RE TRANSACTION HOLDINGS
In 2006, ATL sued IYG Holding Co., 7-Eleven, Inc.,
and others for infringement of U.S. Patent No. 6,945,457
(“the ’457 patent”). NCR Corp., which is indemnifying the
defendants, then sought reexamination of the ’457 patent.
The infringement case was stayed pending the outcome of
the reexamination.
The reexamination proceeding ended with the Board
of Patent Appeals and Interferences affirming a patent
examiner’s rejection of seven of the claims of the ’457
patent. In case No. 2011-1361, ATL has appealed the
Board’s order, arguing that the Board erred in finding
that the claims would have been obvious in light of the
prior art.
While the district court’s stay was in effect, ATL ob-
tained a number of additional patents that claimed prior-
ity to the same parent application as the ’457 patent.
When the stay was lifted, ATL filed an amended com-
plaint adding four of the patents obtained during the stay
to the previously asserted claims of the ’457 patent. The
district court subsequently granted summary judgment of
noninfringement. The court ruled that the accused prod-
ucts—certain Vcom automated teller machines
(“ATMs”)—did not infringe the asserted claims of any of
the five patents at issue. The court also ruled that sev-
eral asserted claims of the ’457 patent were invalid for
indefiniteness. In case No. 2011-1492, ATL has appealed
from that judgment, arguing that (1) the district court
erroneously construed several claim terms, (2) the court
erred in finding that the accused products do not infringe
the asserted claims, and (3) the court erred in determin-
ing that several claims of the ’457 patent are indefinite.
I
IN RE TRANSACTION HOLDINGS 4
The patents at issue are generally directed to a
method and apparatus for providing banking services and
retail transactions to a consumer through an ATM that is
connected to the Internet. The five patents share the
same specification and have very similar claims. Inde-
pendent claims 1 and 9 of the ’457 patent are representa-
tive of the asserted claims. Claim 1 recites as follows:
Integrated banking and transaction apparatus for
use by a consumer, comprising:
an automated teller machine; and
means for providing a retail transaction to the
consumer through an Internet interface to the
automated teller machine.
Claim 9 recites as follows:
A method of providing banking services and
transaction capability to a consumer in a single
automated transaction machine, comprising the
steps of:
providing automated teller machine access to the
consumer via the automated transaction machine;
and
providing Internet access to the consumer via the
automated transaction machine and realizing a
retail transaction.
II
We first address the ’457 reexamination. The Board
found that claims 1, 2, 5, 9, 10, and 14 would have been
obvious over an article by Subrizi, et al., in view of U.S.
5 IN RE TRANSACTION HOLDINGS
Patent No. 5,781,632 (“Odom”), and that claim 3 would
have been obvious over Subrizi in view of Odom and a
U.S. patent to Mos. 1 ATL argues that the Board erred in
finding that the asserted claims of the ’457 patent would
have been obvious in light of the prior art. Subrizi is a
November 1994 article that discussed problems with
ATMs of that era and proposed a new prototype ATM.
Odom teaches the use of encryption to send secure data
over the Internet for the purpose of completing financial
transactions.
In its decision affirming the examiner’s obviousness
rejections, the Board found that Subrizi taught the use of
an ATM over “the information superhighway” to perform
retail transactions. The Board further found that while
the Internet and the information superhighway might
have been regarded as different entities at the time, they
would have been seen as obvious alternatives to one
another, especially in light of Odom’s teaching that the
Internet had become the information superhighway of
choice. Those findings are supported by substantial
evidence.
Although Subrizi focuses principally on a redesigned
user interface for ATMs, it also teaches that the described
redesigned ATMs could allow customers to interact with
“utility companies, credit card companies, and third party
brokerage houses,” as well as “support other nontradi-
tional activities such as bill payment, purchase of airline
tickets, travel reservations, and brokerage transactions.”
Subrizi also notes that the interface could be ported to
non-traditional ATMs, and “the idea of a branded virtual
1 ATL has not separately addressed the rejection of
claim 3, so that claim stands or falls with the other
claims.
IN RE TRANSACTION HOLDINGS 6
banking space that can be accessed from a variety of
information ‘ports’ recasts the traditional ATM as just one
public-access window into a ubiquitous financial network,
an endless lattice of financial and other services that will
eventually be part of the information superhighway.”
Odom addresses how to use encryption to send secure
data over the Internet. In the “Background of the Inven-
tion” section, Odom states: “Through the years, the
Internet has become the information ‘superhighway’ of
choice for an ever increasing number of individuals who
have turned to it as an inexpensive way of transmitting
electronic messages and other information.”
ATL’s argument that the Board’s findings are not
supported by substantial evidence is unpersuasive. ATL
disputes the effectiveness of Odom for securing transac-
tions, but it has not put forward any evidence that per-
sons of ordinary skill would have doubted Odom’s
teachings. ATL also argues that, at the time, a person
having ordinary skill in the art would have viewed the
Internet and the information superhighway as competi-
tors. The evidence that ATL relies on, however, is not
helpful to it. ATL cites an article by Vizard, but that
article notes that “[t]he data highway model everyone is
looking at is a confederation of computer networks called
the Internet.” According to Vizard, services to access the
Internet could be “just another lane on the information
highway.” ATL also relies on an article by Besser, which
states that the Internet and the information superhigh-
way are “in many ways diametrically opposed models.”
But the article acknowledges that it was widely believed
that “the Information SuperHighway will just be a faster,
more powerful version of the Internet.” That statement
supports the conclusion that a person having ordinary
skill in the art would have considered the Internet as at
least an alternative to the information superhighway.
7 IN RE TRANSACTION HOLDINGS
ATL also points to evidence that at the time the pat-
ent application was filed, the Internet was slow and
difficult to search. But that evidence is not particularly
relevant; the claimed ATMs would not need high band-
width because ATMs transmit relatively small amounts of
data, and the ATMs would not need efficient search
capabilities because they would already have the ad-
dresses of the services to which they would need access.
As for ATL’s reliance on its expert’s declarations, even he
admitted that “a person of ordinary skill in the art on
May 10, 1996 would have understood the phrase ‘Infor-
mation Superhighway’ to include the Internet . . . .”
Accordingly, none of the evidence relied on by ATL calls
into question the Board’s determinations, particularly in
light of the deferential “substantial evidence” standard
that applies to its factual findings.
ATL attempts to overcome the obviousness rejection
by reference to secondary considerations, including com-
mercial success. In support of its argument that the
claimed invention has been commercially successful, ATL
points to the success of certain Vcom ATMs, which are the
same products that ATL accused of infringing its patents
in the related district court litigation. The Board noted
that “no evidence of a court finding of infringement has
been proffered,” and in appeal No. 2011-1492, we are
upholding the district court’s determination that the
accused Vcom ATMs do not infringe the ’457 patent.
Because the Vcom ATMs are not embodiments of the
claimed invention, their success cannot be attributed to
the ’457 patent. See, e.g., In re DBC, 545 F.3d 1373, 1384
(Fed. Cir. 2008). Moreover, the Board found that ATL
had failed to show that the commercial success of the
Vcom products was due to their appropriation of the
invention rather than to factors such as marketing and
advertising, co-branding based on placement of the prod-
IN RE TRANSACTION HOLDINGS 8
ucts in 7-Eleven stores, and incentives such as the waiver
of certain fees. ATL has not seriously challenged those
findings on appeal. Accordingly, we affirm the Board’s
determination that claims 1-3, 5, 9, 10 and 14 of the ’457
patent would have been obvious in light of the prior art.
III
In its appeal from the adverse judgment of the district
court, ATL argues that the district court misconstrued the
terms “Internet” and “Internet interface,” that the court
erred in granting summary judgment of noninfringement,
and that the court erred in determining that several
claims of the ’457 patent are invalid for indefiniteness.
A
ATL first contends that the district court adopted an
incorrect definition of the term “Internet.” The district
court construed “Internet” to mean “a public network that
is logically linked together by a globally unique address
space.” ATL argues that the court should have construed
the term to include private networks. The term “Inter-
net” is not used by itself in any of the claims, however.
Instead, the pertinent claim terms in the patents at issue
are “Internet interface,” “Internet access,” and “Internet
connection,” so we address the meaning of those terms,
not the term “Internet” standing alone.
The plain language of the claims and the supporting
evidence makes clear that the limitations reciting “an
Internet interface to the automated teller machine,”
“providing Internet access to the consumer via the auto-
mated teller machine,” and “an Internet interface to an
Internet connection,” require that the customer be able to
use the ATM to access services available through the
9 IN RE TRANSACTION HOLDINGS
Internet. The claims envisage an ATM having Internet
access (through an Internet interface) that the customer
can use to conduct both banking and other transactions,
such as retail transactions. Thus, regardless of whether
the Internet is defined to include private as well as public
networks, it is clear from the references to the Internet
interface and Internet access that the claims do not read
on ATMs that are connected only to a private network
and not to the Internet. The common specification con-
firms that point. It provides that “[t]he key to the inven-
tion is the multiple functioning of the terminal as
compared to primarily single purpose devices of the prior
art.” ’457 patent, col. 5, ll. 37-40. The “multiple function-
ing” refers to a host of services that the invention contem-
plated the ATM would be able to provide by virtue of its
Internet access, such as “insurance services, restaurant
services, travel services, . . . floral delivery services, . . .
news services, transportation services, utility services,
physician services,” and many more. Id. at col. 3, ll. 31-
36. Moreover, the inventor’s deposition testimony indi-
cates that he contemplated that customers could use the
ATMs’ Internet access to perform such functions as
browsing the Web and checking e-mail.
The district court defined “Internet interface” to mean
“Internet access” and interpreted the two terms to require
that the ATM actually have an Internet connection. That
construction is entirely consistent with the intrinsic
record. During prosecution, the inventor used the term
“Internet interface” interchangeably with “Internet con-
nection” and “Internet access.” And in distinguishing the
claims containing the “Internet interface” (or “Internet
access”) limitation from a prior art reference, the inventor
argued that the reference in question “does not teach or
suggest the use of an ATM with an Internet connection to
conduct retail transactions,” and that in the prior art
IN RE TRANSACTION HOLDINGS 10
device, a customer “never utilizes an Internet connection
to realize a retail transaction.” During the reexamina-
tion, ATL also equated “Internet interface” with an Inter-
net connection or Internet access. In distinguishing a
claim with the “Internet interface” limitation from prior
art references, ATL argued that one reference “does not
teach giving users access to the Internet through the
automated teller machine,” that another reference con-
tains “no suggestion that an ATM machine connected to
the Internet would allow renewal of one’s driver’s license,”
and that “nowhere is there any suggestion that a device
like an ATM can have its functions expanded to include a
multitude of non-banking related retail functions by being
connected to the Internet.” In short, the district court’s
construction of the term “Internet interface” is entirely
sensible, and we uphold it. Moreover, although the dis-
trict court did not expressly construe the terms “Internet
access” and “Internet connection,” we hold that those
terms likewise require that the ATMs have access to
retail services publicly available over the Internet and
exclude ATMs that are connected only to private net-
works.
B
ATL argues that, even under the claim construction
adopted by the district court, summary judgment of
noninfringement was improper. ATL contends that the
accused Vcom ATMs infringe the various patents in suit,
either literally or under the doctrine of equivalents.
It appears to be undisputed that the Vcom ATMs
themselves are not connected to the Internet and cannot
be accessed over the Internet. The defendants provided
unrebutted testimony that the Vcom ATMs conduct
transactions over a fully private frame relay network, and
11 IN RE TRANSACTION HOLDINGS
ATL’s expert seemed to acknowledge that the Vcom ATMs
are unable to browse the Web or do other tasks typically
associated with Internet access. Although it is true that
something can be connected to the Internet and not have
Web access (for example, because it does not have a Web
browser installed), the unrebutted evidence shows that
the ATMs themselves are connected only to a fully private
frame relay network and not to the Internet.
ATL acknowledges that the Vcom ATMs are on a pri-
vate network, but it argues that a private network can
still “be on the internet so long as the network has at
least one publically facing address space.” The evidence
shows that the Vcom ATMs use a “Postilion server” to
communicate over a private “Cardtronics” network, and
that users cannot cause data to be sent to any computer
on any network other than to the Postilion server on the
Cardtronics network. ATL argues that the “Vcom system”
is connected to the Internet through the “public IP ad-
dress” of the Postilion server and other devices that are
connected to the Vcom ATMs. The evidence that various
segments of the Vcom system have IP addresses does not
help ATL, however, because the unrebutted evidence
shows that the accused Vcom ATMs themselves are on a
private network, are not connected to the Internet, and do
not have public IP addresses. The evidence further shows
that even customer service employees cannot access the
ATMs remotely; they can access certain information from
the Cardtronics network only over a secure VPN, which
can receive limited data from the network. Thus, a cus-
tomer service employee’s computer cannot access any of
the Vcom ATMs, and the Vcom ATMs cannot access the
customer service employee’s computer.
ATL argues that the accused Vcom ATMs necessarily
provide Internet access or have an Internet interface
IN RE TRANSACTION HOLDINGS 12
because ATL’s expert was able to “ping” the “Vcom sys-
tem,” i.e., to obtain a response from the Vcom system by
sending a message to that system over the Internet. ATL
also argues that because hackers in Russia were able to
hack into the Vcom system by using the Internet, Vcom
ATMs must have an Internet interface and be capable of
Internet access.
That evidence does not show that the Vcom ATMs in-
fringe the asserted claims. The fact that ATL’s expert
was able to ping Vcom’s system, as opposed to Vcom
ATMs, is meaningless. It shows that some element of the
Vcom system is on the Internet, but it does not show that
any individual ATM is on the Internet, which is what the
asserted claims require.
Similarly, the news article introduced by ATL to show
that the Vcom system had been hacked from an outside
source in Russia does not prove that the Vcom ATMs are
on the Internet. The article is not specific about the
nature of the incursion, and it does not state that a Vcom
ATM was hacked remotely over the Internet. Instead, it
suggests that the hackers gained access to 7-Eleven’s
servers through 7-Eleven’s public web page, where they
stole information and used it to create fake ATM cards.
To actually obtain money from the Vcom ATMs, the
hackers had to go to an ATM, insert a card, and withdraw
cash. The article does not say that the hackers succeeded
in accessing the Vcom ATMs remotely. Therefore, even
assuming the article to be accurate, it does not support
ATL’s theory of the case.
While ATL’s evidence suggests that some element of
the Vcom system may be on the Internet, ATL has not
produced any evidence showing that the accused Vcom
ATMs themselves are on the Internet. The defendants
13 IN RE TRANSACTION HOLDINGS
have provided substantial, unrebutted evidence that the
accused Vcom ATMs are not on the Internet, and that a
customer cannot use a Vcom ATM to send data to, or
receive data from, any computer outside the private
dedicated frame relay network that connects the Vcom
ATMs with the Postilion server. Since the asserted
claims of all five patents require an Internet interface, an
Internet connection, or Internet access, ATL has not
pointed to a genuine issue of material fact as to whether
the accused products literally infringe the asserted
claims. Accordingly, summary judgment in favor of the
defendants was appropriate.
ATL is no more successful in arguing that the accused
Vcom ATMs infringe under the doctrine of equivalents.
The “all limitations rule” restricts the doctrine of equiva-
lents by preventing its application when doing so would
vitiate a claim limitation. Carnegie Mellon Univ. v.
Hoffmann-La Roche Inc., 541 F.3d 1115, 1129 (Fed. Cir.
2008). “In determining whether a finding of infringement
under the doctrine of equivalents would vitiate a claim
limitation, we must consider the totality of the circum-
stances of each case and determine whether the alleged
equivalent can be fairly characterized as an insubstantial
change from the claimed subject matter without render-
ing the pertinent limitation meaningless.” Id.
Here, the claims expressly require a connection to the
Internet. Omitting that limitation while asserting the
doctrine of equivalents would violate the “all limitations
rule.” Moreover, this is not a case in which the accused
products practice a close equivalent of the disputed limi-
tation. A connection to a private network is substantially
different from a connection to the Internet. As relevant to
this appeal, most of the varied services contemplated by
the patent would be unavailable to the ATM if it were
IN RE TRANSACTION HOLDINGS 14
connected only to a private network. Private networks
and the Internet also differ dramatically with respect to
considerations such as security and simplicity of remote
access. Accordingly, private networks and the Internet
are not equivalents for the purposes of the patents at
issue. The district court therefore correctly held that the
accused Vcom ATMs do not infringe the asserted claims
under the doctrine of equivalents.
C
The final issue presented by this appeal is whether
the district court correctly determined that claims 1-3 and
5 of the ’457 patent are invalid for indefiniteness. In light
of our decision sustaining the Board’s order affirming the
examiner’s rejection of the asserted claims of the ’457
patent (including claims 1-3 and 5) for obviousness, we
need not reach the issue of indefiniteness. Accordingly,
we do not address the invalidity portion of the district
court’s summary judgment in this case.
AFFIRMED