Ex Parte 7896248 et al

Patent Trial and Appeal Board

Feb 27, 2017

95001620 (P.T.A.B. Feb. 27, 2017)

UNITED STATES PATENT AND TRADEMARK OFFICE
UNITED STATES DEPARTMENT OF COMMERCE
United States Patent and Trademark Office
Address: COMMISSIONER FOR PATENTS
P.O. Box 1450
Alexandria, Virginia 22313-1450
www.uspto.gov
APPLICATION NO. FILING DATE FIRST NAMED INVENTOR ATTORNEY DOCKET NO. CONFIRMATION NO.
95/001,620 05/10/2011 7896248 39248-9 1550
120728 7590 02/27/2017
amosser@caldwellcc.com
Caldwell Cassady Curry P.C.
2101 Cedar Springs Road Suite 1000
Dallas, TX 75201
EXAMINER
RUBIN, MARGARET R
ART UNIT PAPER NUMBER
3992
MAIL DATE DELIVERY MODE
02/27/2017 PAPER
Please find below and/or attached an Office communication concerning this application or proceeding.
The time period for reply, if any, is set in the attached communication.
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
____________________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________________

SQUARE, INC.,
Requester,

v.

Patent of REM HOLDINGS 3, LLC,
Patent Owner
____________________

Appeal 2017-001184
Reexamination Control No. 95/001,620
Patent No. 7,896,248 B2
Technology Center 3900
__________________

Before JOHN A. JEFFERY, JEFFREY B. ROBERTSON, and
DENISE M. POTHIER, Administrative Patent Judges.

POTHIER, Administrative Patent Judge.

DECISION ON APPEAL
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I. STATEMENT OF CASE
In an earlier decision mailed March 28, 2014 (“Op.”), the Board
affirmed the Examiner’s decision rejecting claims 1–13 but reversed the
non-adoption of claims 14–20. Op. 37. The Board entered a rejection
against claims 14–20, designating the rejection a new ground. Op. 30–37.
Patent Owner elected to reopen prosecution before the Examiner pursuant to
37 C.F.R. § 41.77(b)(1), submitting amendments to claims 15–18 and 20 and
two additional declarations (“PO Response”). Requester filed comments
under 37 C.F.R. § 41.77(c) (“3PR Response”). In an order entitled “Order
Remanding Inter Partes Reexamination Under 37 C.F.R. § 41.77(d) to the
Examiner,” the Board granted Patent Owner’s request to reopen prosecution
for consideration of claims 14–20.
On remand, the Examiner maintained the rejection of claims 14 and
19, but determined the rejection of claims 15–18 and 20 was overcome. Ex.
Deter. 4. Patent Owner (“PO Comments”) and Requester (“3PR
Comments”) submitted comments as set forth in 37 C.F.R. § 41.77(e).
Patent Owner (“PO Reply”) and Requester (“3PR Reply”) also submitted
replies to each other’s comments as set forth in 37 C.F.R. § 41.77(e).
This proceeding has been returned to the Board under 37 C.F.R.
§ 41.77(f). Our new Decision is deemed to incorporate the earlier Decision,
except for those portions specifically withdrawn. 37 C.F.R. § 41.77(f).

Claim Status/Representative Claims
Claims 1–16 and 18–20 are pending and are subject to reexamination.
As noted above, claims 14–20 were subject to the remand order. Claim 17
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has been canceled.1 Upon return, we address claims 14–16 and 18–20.
Illustrative claim 14 (original) reads as follows:
14. A card reader device for reading a card having data stored
on a magnetic stripe incorporated into the card the device
comprising:
a read head for passing a magnetic stripe of a card by to read
data stored on a magnetic stripe and for producing a signal
indicative of data stored on a magnetic stripe;
a signal setting device for setting an amplitude of the signal
indicative of data stored on a magnetic stripe;
an integrated circuit device connected to the signal setting
device and the read head for receiving the signal indicative of
data stored on a magnetic stripe; and
an output plug connected to the integrated circuit device
adapted to be inserted into an input associated with a host
device for providing the signal indicative of data stored on a
magnetic stripe to a host device and adapted to receive power
from the host device by an audio output associated with the host
device.

Prior Art
Requester relies on the following as evidence of unpatentability:
Jones US 2001/0053228 A1 Dec. 20, 2001
Wood US 2004/0012875 A1 Jan. 22, 2004
Odagiri US 2004/0041911 A1 Mar. 4, 2004
Antonio US 2006/0223580 A1 Oct. 5, 2006
Sander US 8,254,592 B2 Aug. 28, 2012

1 In Patent Owner’s Comments submitted July 1, 2015, Patent Owner
requested claim 17 be canceled pursuant to 37 C.F.R. § 41.63(a). PO
Comments 4. The Examiner entered Patent Owner’s Comments, which
includes the request to cancel claim 17, in the August 26, 2016 Transmittal
of Communication to Third Party Requester Inter Partes Reexamination. 37
C.F.R. § 41.63 permits amendments to cancel claims that do not affect the
scope of any other pending claim. The cancellation of claim 17 does not
affect any other pending claim’s scope.
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The following Declarations are presented in this proceeding:
Declaration of Dr. Robert E. Morley dated September 1, 2011 (1st
Morley Decl.)
Declaration of Dr. Robert E. Morley dated January 23, 2012 (2d
Morley Decl.)
Declaration of Dr. Robert E. Morley dated December 20, 2012 (3d
Morley Decl.)
Declaration of Dr. Robert E. Morley dated May 27, 2014 (4th Morley
Decl.)
Declaration of Stephen R. Wood dated December 19, 2012 (1st Wood
Decl.)
Declaration of Stephen R. Wood dated May 28, 2014 (2d Wood
Decl.)
Declaration of Dr. David A. Thompson dated September 29, 2011 (1st
Thompson Decl.)
Declaration of Dr. David A. Thompson dated September 4, 2012 (2d
Thompson Decl.)
Declaration of Dr. David A. Thompson dated June 26, 2014 (3d
Thompson Decl.).

Maintained, Adopted, and Non-Adopted Rejections
The Examiner maintains the following rejection and adopts the
following rejections proposed by Requester:

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Reference(s) Basis Claims Presented
Wood, Odagiri, and
Antonio § 103(a) 14 and 19
Op. 30–37;
Ex. Deter.
4–6, 8
§ 112, ¶ 12 15–18 Ex. Deter. 6–7, 10
§ 112, ¶ 2 15–18 Ex. Deter. 6–7, 9–10

The Examiner does not adopt the following rejections proposed by
Requester:

References/Limitation Basis Claims Presented
Wood, Odagiri,
Antonio, and Sander § 103(a)
15, 16, 18,
and 20
3PR
Response
23–29; Ex.
Deter.
12–13
Wood, Odagiri,
Antonio, and Jones § 103(a)
15, 16, 18,
and 20
3PR
Response
29–34; Ex.
Deter.
13–14
“the card reader device
is configured to
rectify”
§ 112,
¶¶ 1 and 2 20
3PR
Response
9, 11–13,
16; Ex.
Deter.
7, 9

2 Throughout this opinion, we will refer to the paragraph numbers of various
sections of Title 35 of the United States Code prior to the America Invents
Act (AIA).
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II. ISSUES
We review the appealed rejections for error based upon the issues
identified by Owner in its appeal brief, and in light of the arguments and
evidence produced thereon. Cf. Ex parte Frye, 94 USPQ2d 1072, 1075
(BPAI 2010) (precedential) (citing In re Oetiker, 977 F.2d 1443, 1445 (Fed.
Cir. 1992)). “Any arguments or authorities not included in the briefs
permitted under this section or [37 C.F.R.] §§ 41.68 and 41.71 will be
refused consideration by the Board, unless good cause is shown.” 37 C.F.R.
§ 41.66(c)(1)(vii).
The main issues are whether the Examiner erred in:
A. Maintaining the obviousness rejection of claims 14 and 19 based
on Wood, Antonio, and Odagiri given the newly presented evidence?
B. Not rejecting amended claims 15, 16, 18, and 20 under 35 U.S.C.
§ 103 based on either (1) Wood, Antonio, Odagiri, and Sander or (2) Wood,
Antonio, Odagiri, and Jones?
C. Adopting or not adopting various proposed rejections of claims 15,
16, 18, and 20 under 35 U.S.C. § 112, first paragraph?
D. Adopting or not adopting various proposed rejections of claims 15,
16, 18, and 20 under 35 U.S.C. § 112, second paragraph?

III. ANALYSIS
A. Maintained § 103 Rejection of Claims 14 and 19
The Examiner maintains the rejection of claims 14 and 19 based on
Wood, Antonio, and Odagiri under 35 U.S.C. § 103 as presented in the
March 28, 2014 Board Opinion. Ex. Deter. 4–5; see also Op. 30–37. The
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Examiner notes that claims 14 and 19 have not been amended. Ex. Deter. 4.
Concerning this rejection, the Examiner incorporates Requester’s Response.
Ex. Deter. 5 (incorporating by reference 3PR Response 19–21), 8
(incorporating by reference 3PR Response 21–22 and 3d Thompson Decl.
¶ 18). Citing to the Manual of Patent Examining Procedure (MPEP)
§ 2682(II), the Examiner states that Patent Owner’s arguments concerning
claims 14 and 19 “are unsupported by the submission of evidence or a
showing of facts.” Id. at 5. The Examiner also incorporates by reference the
Requester’s response to the evidence of nonobviousness. Id. at 8
(incorporating 3PR Response 2–8).
Patent Owner does not agree that the obviousness rejection of claim
14 based on Wood, Odagiri, and Antonio “is proper” acknowledging that the
Examiner is bound by the Board’s findings, and stating that it “does not
challenge the propriety of the combination here.” PO Response 9 n.1.
Nevertheless, Patent Owner presents argument concerning the rejection,
including (1) “this combination does not teach the claimed invention” (id. at
10), (2) “[t]he teachings of the combination do[] not contemplate
asynchronous communications at all or synchronous communications
relying on a clock signal from the host device as encompassed by claim 14”
(id.), (3) Odagiri does not provide power through an audio output (id. at 7),
and (4) Wood teaches a synchronous data waveform synchronized by a
strobe signal (id. at 13 (citing Wood ¶ 32 when discussing claim 19)).
In response to a Board decision containing a new ground of rejection
under 37 C.F.R. § 41.77, Patent Owner may either elect to reopen
prosecution under 37 C.F.R. § 41.77(b)(1) or request rehearing under
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37 C.F.R. § 41.77(b)(2), but not both. Here, Patent Owner elected to reopen
prosecution under 37 C.F.R. § 41.77(b)(1) and did not request rehearing
under 37 C.F.R. § 41.77(b)(2). Patent Owner may request that this
proceeding be reheard under 37 C.F.R. § 41.79(a)(4) at the proper time.
When appropriately raised, these arguments will be considered.
New Evidence of Secondary Considerations
We next turn to the new evidence of nonobviousness presented to
rebut the prima facie showing of obviousness for claims 14 and 19. See id.
at 15–20. In response to the new grounds of rejections for claims 14–20
pursuant to 37 C.F.R. § 41.77(b), Patent Owner presents the following
evidence: (1) another supplemental3 declaration of Dr. Robert E. Morley,
dated May 28, 2014 (4th Morley Decl.); (2) a second declaration of Stephen
R. Wood, dated May 28, 2014 (2d Wood Decl.), and (3) Exhibits 1–28 and
A–B.4 The Examiner was not persuaded by this evidence, incorporating
Requester’s response by reference. Ex. Deter. 4–5 (citing 3PR Response
19–21), 8 (citing 3PR Response 2–8, 21–22 and 3d Thompson Decl. ¶ 18).

3 Multiple “supplemental” declarations of Dr. Morley have been submitted
in this proceeding. 2d, 3d, and 4th Morley Decl. Exhibit 28 includes a first
supplemental declaration of Dr. Morley, dated January 23, 2012. 2d Supp.
Morley Decl. Here, we refer to the supplemental declaration dated May 27,
2014, which is distinct from Exhibit 28.
4 To clarify, some of Exhibits 1–28 and A–B are not new evidence, such as
Exhibits 1 and 2. Also, Exhibit 3 and B are duplicates. Dr. Morley further
mislabels (1) Exhibit B, available at VentureBeat’s website, as Attachment
A and (2) Exhibit A, available at CNET’s website, as Attachment B. 4th
Morley Decl. ¶¶ 3–4 (citing http://venturebeat.com/2012/03/26/square-adds-
encryption-to-its-square-reader in ¶ 3 when discussing Attachment A and
http://www.cnet.com/how-to/how-to-get-your-hands-on-the-new-square-
card-reader/ in ¶ 4 when discussing Attachment B).
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Patent Owner argues that the findings and conclusions made by the
Board in the previous decision regarding the secondary evidence are
irrelevant to claims 14–20 because of the new facts in the new supplemental
declaration of Dr. Morley and the arguments set forth in Patent Owner’s
response dated May 28, 2014. PO Comments 24–25. Requester argues that
the evidence related to the claims (e.g., claims 1 and 7) other than the
specific claims at issue (e.g., claims 14–16 and 18–20) are irrelevant and
improper. 3PR Response 5.
We agree that additional evidence has been provided and must be
considered in determining whether the claims are obvious. On the other
hand, we disagree with both Patent Owner and Requester concerning how to
treat the presented evidence. Any evidence concerning a feature found in all
the claims (e.g., read head, signal setting device, and output plug) is relevant
to the inquiry of whether Patent Owner has demonstrated a sufficient nexus
between the claimed invention and the evidence of secondary
considerations, which may or may not rebut the prima facie case of
obviousness. Accordingly, we consider evidence related to each of those
features that claims 14 and 19 have in common with other claims (e.g.,
claims 1 and 7).
For example, Patent Owner discusses the evolution of Square’s reader
over “the course of four years” (PO Response 17) from a “Version 1”
launched in December 2009 to “Version 2” and “Version 3” launched in
2012 and late 2013, respectively (id. at 15–16). Notably, the latter two
readers are referred to as “v2” and “v3” card readers in Dr. Morley’s new
supplemental declaration. See, e.g., 4th Morley Decl. ¶¶ 3–6, 15. Patent
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Owner contends Version 1’s reader maps to claim 1 of the ’248 patent,
Version 2’s reader maps to claim 7 of the ’248 patent, and Version 3’s
reader corresponds to independent claim 14 of the ’248 patent. PO
Response 16. Patent Owner also asserts each of the Version 1–3 readers
includes a read head, a signal setting device, and an output plug. Id. at
15–16. We agree with this latter statement, and thus any evidence
concerning these features is relevant to our analysis addressing secondary
considerations for claims 14–16 and 18–20.
Patent Owner argues that the new objective evidence is substantial
and demonstrates nonobviousness of claims 14 and 19. Id. at 15–20; PO
Comments 13–17. Requester states the compelling case of obviousness is
not outweighed by the case for nonobviousness. 3PR Response 2, 8. Upon
review, we agree with Requester. We initially refer to our discussion in our
previous opinion concerning any of the same or similar evidence discussed
by Patent Owner. See Op. 21–30.
Patent Owner mainly focuses on evidence of commercial success. See
PO Response 15–20. Patent Owner asserts the supplemental Morley
Declaration shows Square’s product is the invention disclosed and claimed,
and that it should be presumed that any of Square’s commercial success is
due to the patented invention of claims 14 and 19 of the ’248 patent. PO
Comments 27 (citing Ormco Corp. v. Align Tech., Inc., 463 F.3d 1299,
1311–12 (Fed. Cir. 2006)). Requester asserts that that there is no nexus
between the evidence of commercial success and the claims at issue. See
3PR Response 2–3.
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Dr. Morley testifies that “[u]nder the Board’s claim construction,
claims 1 and 7 read on Square’s v3 reader[ and] claim 14 maps almost
perfectly[.]” 4th Morley Decl. ¶ 15. Notably, although broader in scope
than claim 14, claim 1 does not recite an integrated circuit as recited in claim
14, and claim 7 does not recite the output plug is adapted to receive power
from the host device as recited in claim 14. As such, claims 1 and 7 include
the recited features of claim 14 (i.e., a read head, a signal setting device, and
an output plug), but claims 1 and 7 do not have all the features of Square’s
v3 reader, which Dr. Morley describes as having an integrated chip
“powered ‘via the audio jack of a smartphone.’” Id. ¶ 17.
Additionally, Dr. Morley has mapped the features found in Square’s
Version 3 reader to only some of the elements in claim 14. Id. ¶¶ 16–17.
Although there is a discussion of the signal setting device in the context of
“the v2 reader” (id. ¶ 9), there is no parallel discussion that the Version 3
reader has a signal setting device as recited in claim 14 (see id. ¶¶ 16–18).
As such, Dr. Morley does not articulate sufficiently that the Version 3 reader
has all the features of claim 14. We therefore disagree with Patent Owner
that the new declaration demonstrates that the Version 3 reader is the
invention of claim 14 disclosed and claimed. See PO Comments 27, 31. As
such, we are not persuaded that the commercial success of Square’s
Version 3 reader is presumed to be due to claim 14’s invention and that a
presumed nexus between this claimed invention and the commercial success
has been established. See id. at 27.
Patent Owner further contends that the evidence related to Square’s
Version 3 reader is “‘reasonably commensurate with the scope’” of claims
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14 and 19. Id. (citing In re Kao, 639 F.3d 1057, 1068 (Fed. Cir. 2011))
(emphasis omitted). Yet, Dr. Morley’s testimony does not address the
Version 3 card reader’s commercial success in sufficient detail. See
generally 4th Morley Decl. For example, Dr. Morley further discusses
readers from companies other than Square that include the features of claim
14. 4th Morley Decl. ¶¶ 19–26. Yet, regarding all these readers, including
Square’s, the declaration does not address sufficiently the commercial
success of the described Version 3 reader launched in late 2013 or that the
success of these readers was due to the claimed features of claim 14 of the
’248 patent. See generally id.
Dr. Morley also refers to Attachment B (4th Morley Decl. ¶ 4), which
is Exhibit A as explained above, and which addresses some of the popular
features of Square’s Version 3 card reader. Specifically, Exhibit A dated
December 9, 2013, discusses “the release of a new card reader” (presumably
Square’s Version 3 card reader) “is roughly 45 percent smaller and is
supposed to be far more accurate than its predecessor.” PO Response,
Ex. A. This article suggests in part that unclaimed features (e.g., size and
accuracy) contributed to its popularity, failing to demonstrate a requisite
nexus between claim 14’s invention and its commercial success. Id.
Other new evidence addresses that the integrated chip design of
Square’s Version 3 card reader requires little power and thus the design can
use the smart phone’s power. Id., Ex. 4, cited in 4th Morley Decl. ¶ 16
(citing www.wired.com/2013/12/the-new-square-reaer-a-look-at-how-
gadget-guts-are-designed). That is, “[w]ith their own chip, . . . Square was
able to be more efficient in their use of power, to the point that they could
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draw all they needed from the smartphone via the audio jack,” save on
space, and get better performance. Id., Ex. 4. This provides some evidence
that any illustrated commercial success of Square’s Version 3 reader due to
its smaller size may be tied to the integrated chip feature recited in claim 14.
Yet, considering this exhibit in its entirety, Exhibit 4 provides other
evidence that Square’s commercial success of its Version 3 card reader may
be unrelated to the claimed integrated chip. That is, this article also
discusses other unclaimed features (e.g., design details, such as having a
wider footprint, the card slot location, the elimination of the bulky
“shoulder,” and shrinking a gap between two parts of the enclosure that
makes the device seem more substantial and of higher quality) that may
contribute to the commercial success of the Version 3’s card reader. See id.
And when the secondary considerations, such as commercial success,
actually result from something other than what is both claimed and novel in
the claim, no nexus to the merits of the claimed invention exists. See Kao,
639 F.3d at 1068 (citing Tokai Corp. v. Easton Enters., Inc., 632 F.3d 1358,
1369 (Fed. Cir. 2011)).
Additionally, other evidence does not demonstrate convincingly that
the commercial success discussed in these various exhibits relates to the
features of the Version 3 reader launched in late 2013. For example,
Exhibits 5 and 19 (as well as many others) are posted or updated prior to late
2013, which is when Square’s Version 3 card reader was released according
to Patent Owner. See PO Response, Ex. 5 (last updated April 18, 2013), 19
(posted September 17, 2012). Presuming the readers in these exhibits have
at least some of the claimed features in claims 14 and 19, we are not
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persuaded that a sufficient nexus has been established between the claimed
invention and the commercial success of this reader.
For example, Patent Owner asserts that Mr. Jack Dorsey states “‘[t]he
product sells itself,” and that this statement illustrates the commercial
success of the claimed readers “to reach the small merchant[.]” Id. (quoting
Ex. 5), 20 (citing Ex. 19). However, there is insufficient evidence that the
“‘product that sells itself’” (id., Ex. 5) refers to the claimed features of claim
14’s card reader or other features of Square’s product. That is, this same
article discusses the product to include “a souped-up point-of-sale app” and
“a consumer-facing app,” as well as including a product that charges either
2.75 percent per swipe or a flat fee of $275 per month. Id. Exhibit 5 also
states the small merchants (e.g., Golly NYC and a photographer) discuss
features of depositing money in their account overnight and “Square’s
analytics” attribute to their reason for using the reader and the growth of
Square’s reader in the industry. These reasons for using Square’s reader are
not sufficiently tied to Version 3’s reader features to demonstrate a nexus
between the claimed invention and Square’s commercial success. See id.
Other examples also illustrate that unclaimed features may be
attributable to Square’s commercial success. Exhibit 19 discusses other
Square services, including “a merchant-finder for people to identify which
businesses take Square payments,” a “manage inventory” feature, and
paying with Square without pulling out a card, that may relate to Square’s
growth in processed credit card payments. See id., Ex. 19. Exhibit 10 states
Square’s readers are attractive to small merchants that need portability,
simplicity and cheap service fees, which are also not features of claim 14’s
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reader. See id., Ex. 10. Additionally, Exhibit 10 describes features of
Square’s reader that are less than desirable or not attributable to its
commercial success, including its size, stability, security, and pricing
structure. See id. The Board’s previous Decision also noted various other
reasons in the presented evidence unrelated to the claimed invention
attributable to Square’s success. Op. 26–27. Thus, when considering the
evidence in its entirety and as Requester asserts, much of the Version 3
reader’s commercial success is due to unclaimed features. See 3PR
Response 3.
Concerning our previous decision, Patent Owner contends that a
statement made related to Intuit’s commercial success with its reader being
tied to a free reader or a service that does not require a monthly fee or
contract demonstrates a nexus to claim 14’s or Version 3’s card reader and
its commercial success. Op. 26, cited in PO Response 18. To clarify, we
indicated previously that the evidence related to Intuit demonstrates that its
service does not require a monthly fee or contract, and this free service
feature may be attributable to Intuit reader’s commercial success. Op.
26–27. As such, we previously determined that there was evidence that the
commercial success of readers, like Intuit’s, may be attributable to a
business choice rather than the claimed features of claim 14’s or 19’s reader,
such that any presumed nexus was rebutted. See id. We maintain this
determination when considering the new evidence.
Exhibit 11 discusses Square disrupted the established market “by
offering new options.” PO Response, Ex. 11. Granted, this exhibit states
the “free credit card reader” is what has made Square “achieve[] success in
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the US.” Id. But, the feature of providing a free reader does not establish a
sufficient nexus between the claimed invention and its commercial success.
As explained above, the presented evidence may just as well demonstrate
that giving away the readers for free was a business choice made by Square.
See id., Ex. 11; see also 3PR Response 3–4 (discussing other factors,
contributing to Square’s card reader’s commercial success, including
advertising and marketing).
As another example, Patent Owner compares the cost of conventional
readers to smart phone readers. PO Response 18 (citing Ex. 12). Yet, this
comparison does not provide convincing evidence to conclude that Square’s
competitors “would quickly [be] bankrupt if they gave away the more
complex and costly conventional readers for free.” Id.; see also Op. 27
(stating “no supporting information that Intuit’s reader (i.e., ‘the Mophie
reader’), when it cost $79.95, was ‘not successful.’”) Additionally, Dr.
Morley quotes from a YouTube video that indicates that allowing the card
reader to be used with a microphone of “any device” permits the device to
be cheap, indicating that the microphone input feature of another device—
not the card reader itself—contributed to Square’s success. PO Response,
Ex. 27 (1st Morley Decl. ¶ 34). On the other hand, the microphone input
circuit connected to the output plug as recited in claim 15 arguably has some
relationship with the microphone input feature of other devices discussed in
the YouTube video such that this evidence may create a nexus between a
claimed feature and at least some of Square’s commercial success.
Even so, the presented evidence also does not demonstrate “the
keystone of Square’s ‘business model’ is the use of the patented reader by
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Square’s customers” as argued. PO Comments 23. Rather, as discussed
above, there are many factors besides Square’s card reader itself why
Square’s customers chose its products. Accordingly, we disagree with
Patent Owner that the evidence demonstrates sufficiently that customers
chose Square’s reader “because of the features claimed in the ’248 Patent.”
Id. at 22. We conclude that the new evidence presented does not sufficiently
demonstrate that giving a card reader away for free is tied to claim 14’s
invention of the ’248 patent, establishing a sufficient nexus between the
claimed invention and the commercial success of the Version 3 reader. See
id. at 18 (citing Exs. 11, 27).
Exhibit 5 further discusses three million merchants using Square’s
card reader to process twelve billion dollars a year in transactions, and that
Square has grown from one to eight billion in payments processed annually.
Id., Exs. 5, 19. Patent Owner also states Square is expecting thirty billion
dollars in transactions in 2014. Id. at 18 (citing Ex. 13). However, it is not
clear whether these sales were generated from the purchase of the readers,
attributing the sales to the claimed features of the ’248 patent’s claim 14, or
from processing twelve, twenty, or thirty billion dollars a year (depending
on the article) in transactions using Square’s card reader. See id., Exs. 5, 13,
17, 19. Additionally, Exhibit 14 states that Square shipped two million
readers in six months in 2014. Id., Ex. 14. Yet, the evidence does not
demonstrate the sales generated from the readers, such as from direct sales
of the readers, how many of these two million readers were actually used, or
Square’s sales from customers using the readers (e.g., fees).
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Patent Owner even further contends that Square has captured one third
of the mobile credit card payment market in the United States. Id. at 19–20.
In particular, Patent Owner contends Square had three million merchants
through 2014, the credit card payments would be worth thirty-seven billion
dollars, and that Square processed twelve billion dollars of those payments.
Id. (citing Exs. 5, 20, 21). However, this demonstrates that Square had one
third of the processing market in the United States. See id. This does not
demonstrate the revenues generated from selling the mobile credit card
readers, which embody the claimed invention of the ’248 patent, or even the
sales generated from its fees. See id. That is, there is insufficient nexus
between the claimed features of claims 14 and 19 of the ’248 patent and
Square’s commercial success related to its Version 3 reader.
To be sure, there is evidence of growth in the mobile payment card
reader industry, and how Square filled a niche market for small merchants to
use credit cards in a viable manner. See id. at 17 (citing Exs. 5 and 10), 19
(citing Exs. 5, 15–18). Patent Owner has provided some evidence that
sales/transactions for or using this type of card reader product has grown in
the millions quickly. As an illustration, Exhibits 14 and 15 predict growth in
worldwide mobile payment transactions to grow 62% in 2012 as well as
further growth in the following years and shipping two million of Square’s
readers in six months in 2014. Id., Exs. 14–15. Yet, much of some of this
evidence relates to predicted transaction growth. See id., Exs. 15–18.
Additionally, some evidence is projected or expected— not actual growth —
sales in 2014. See id., Ex. 13. Patent Owner also asserts that Square has
shipped 2 million readers to merchants since Version 3 has launched. Id. at
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18–19 (citing Ex. 14). But, once again, this Exhibit provides insufficient
evidence of the sales attributable to selling the shipped readers. See id.
Additionally, some evidence indicates Square yielded revenue of
“about $550 million, according to three people familiar with the company’s
performance.” Id., Ex. 17. However, there is unpersuasive evidence that
this revenue relates to claim 14’s or 19’s features. See id. In fact, some
evidence in the record states Square recorded losses in 2013 due to fraud.
See id. Nor is it clear from this record how Patent Owner concluded that
Square is estimated to generate “$330 million in gross revenue and $66–99
million net revenue for Square in 2013” (see id. at 19) and how much of this
estimated revenue relates to the features of the claimed invention in claims
14 and 9 of the ’248 patent as opposed to other features of Square’s
business.
Even presuming that the evidence of sales results from processing
transactions or distribution of millions of readers is due to claim 14’s or 19’s
features (see PO Comments 27), there is little evidence to attribute this
success to Square’s Version 3 reader. As previously stated, according to
Patent Owner, the Version 3 card reader was launched “in late 2013.” PO
Response 16. On the other hand, many of the articles provided were written
prior to the launch of the Version 3 reader. See, e.g., PO Response,
Exs. 5, 19.
Patent Owner asserts that our “attention has been diverted to solely
considering the success of a mobile payment processing company as a
whole” and that this “is clear error.” PO Comments 22–23. We disagree
and note that we have considered all evidence presented, including
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specifically Square’s commercial success. Although there is evidence
showing that millions of Square’s readers have been distributed (see id. at
23), as explained above, Patent Owner has not adequately shown that the
features of claim 14’s or 19’s card reader are sufficiently attributable to
Square’s commercial success. See 3PR Response 3–4 (arguing the evidence
fails to prove a nexus). Rather, we find much evidence related to other
features concerning Square’s technology that have attributed to Square’s
success, rebutting any presumed nexus between the claimed invention of the
’248 patent and Square’s Version 3 reader commercial success.
Patent Owner also emphasizes a tweet made by Jack Dorsey that there
is “more value in Square’s software and services than in [Square’s] hardware
‘dongle’.” PO Comments 33 n.1 (citing to Ex. 2054 located in IPR2014-
00312). Yet, this “admission” that allegedly “completely negates Square’s
attorney argument that ‘Square’s success is due to many other factors” is not
part of the record. This statement also does not explain sufficiently what
Mr. Dorsey means by “value” and how this “value” relates to Square’s
commercial success. We therefore are not persuaded that a sufficient nexus
has been established between the claimed invention of claim 14 or 19 of the
’248 patent and the presented evidence of commercial success.
Patent Owner further provides secondary evidence of praise in the
industry. PO Response 17 (citing Ex. 10). Patent Owner asserts “many
were ‘heralding [Square’s readers] as an innovative miracle that will turn the
credit card industry upside down.’” Id. Specifically, Exhibit 10 states
“[p]roponents”— not many —are heralding Square’s reader as an innovative
miracle. Id., Ex. 10. Moreover, Exhibit 10 also states that “[n]aysayers have
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pointed out the potential security risks and higher per-transactions fees.” Id.
This demonstrates that some, and potentially many, in the industry were not
praising Square’s credit card reader.
Patent Owner also reasserts that it has produced evidence that Square
copied Dr. Morley’s card reader. Id. at 15, 17–18. No new evidence is
provided related to copying and we refer to the discussion in the previous
Opinion related to this issue. See Op. 22–24. We additionally note that,
unlike independent claim 1, independent claim 14 includes an integrated
circuit that is not addressed sufficiently related to copying. See PO
Response 15 (referring to a “PO Response to Non-Final OA at 19–24.”5);
see also 3PR Response 7 (stating Patent Owner does not allege copying of
the Version 3 reader). As such, and as Requester asserts, the evidence of
copying the Version 3 reader has not been sufficiently demonstrated. Id. at
7–8.
Accordingly, insufficient nexus has been established between the
claimed invention in claims 14 and 19 of the ’248 patent and the presented
secondary evidence. Nevertheless, even if we were to presume a nexus has
been demonstrated (which it has not), we determine that the case of
obviousness is strong (Op. 30–37) and outweighs the case of
nonobviousness as discussed above and in the previous decision. See id. at
27 (stating “[w]e find other evidence has rebutted any presumed nexus”).

5 Patent Owner does not provide the date of “PO Response to Non-Final
OA.” PO Response 15. There appears to be at least two such responses.
We presume Patent Owner is referring to the response submitted on January
26, 2012.
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B. Non-Adopted § 103 Rejections of Claims 15, 16, 18, and 20
The Examiner states that Wood, Antonio, and Odagiri do not teach the
“rectifier” as recited in claims 15, 16, and 18 or “the card reader device []
configured to rectify” as recited in claim 20. Ex. Deter. 5. Requester does
not dispute this determination, but proposes that the same claims would have
been obvious over Wood, Antonio, Odagiri, and Sander or Jones. 3PR
Response 23–34. Requester reasserts these position in its comments. 3PR
Comments 9–11. Below, we address both of these proposed rejections.
1. Wood, Antonio, Odagiri, and Sander
a. Claims 15, 16, and 18
Amended claim 15 recites “at least one of the left channel circuit and
the right channel circuit comprises a rectifier configured to rectify an audio
output signal received from the associated audio output channel to provide
power to the integrated circuit device.” Amended claims 16 and 18 depend
from claim 15.
The Examiner determines that the Third Thompson Declaration is not
convincing to adopt the proposed rejection based on the cited references and
what Dr. Thompson states is well-known and a matter of design choice. Ex.
Deter. 12. Based on the evidence, the Examiner concludes that the
combination of Wood, Antonio, Odagiri, and Sander does not teach or
suggest the above recitation in claim 15. Id. Specifically, the Examiner is
not persuaded by Dr. Thompson’s testimony, including that (1) connecting a
rectifier to the left or right audio channel would have been a mere design
choice and (2) one skilled in the art would have selected from different
circuits to accomplish this task. Id. (citing 3d Thompson Decl. ¶ 24). The
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Examiner states that Official Notice should only be taken in the
circumstance where facts are capable of instant and unquestionable
demonstration as being well known. Id. at 12–13. The Examiner questions
whether such facts “are notoriously well known” and “beyond dispute,”
given that no prior art has been cited. Id. at 13.
Concerning the “rectifier” in claim 15, Requester states “a person of
ordinary skill in the art would have recognized that if power were ‘delivered
from device 12 to accessory 14 over one of the lines in path 16,’ a rectifier
might be needed to convert the received signal to useable power for the
external device.” 3PR Response 26 (citing 3d Thompson Decl. ¶ 24, which
discusses Sander 10:8–12). Thus, we agree with the Examiner that
Requester proposes that the Examiner take official notice that one skilled in
the art would have known to include a rectifier in the Wood, Antonio, and
Odagiri system in order to convert signals into “useable power.” See Ex.
Deter. 12–13 (discussing the Thompson Decl.). Moreover, Requester relies
on a “design choice” rationale concerning the rectifier’s location (e.g., the
audio channels) to power the integrated circuit device as recited. 3PR
Response 26 (citing 3d Thompson Decl. ¶ 22).
Patent Owner argues that the Wood, Antonio, and Odagiri system
already provides DC power, and thus adding a rectifier to this system is not
necessary and relies on impermissible hindsight. PO Reply 9–12.
Specifically, Patent Owner focuses on Odagiri’s line L1a providing DC
power. See id. at 10, 24. Yet, there is insufficient evidence to support
Patent Owner’s position. Antonio and Odagiri teach various host and data
input devices can be attached to each other. Antonio, Fig. 3; Odagiri,
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Abstract. As such, even if a particular embodiment provides DC power, this
does not demonstrate that all the host devices suggested by the prior art
would generate DC power. Moreover, bodily incorporation of references is
not the test for obviousness; rather, the test focuses on what the combined
teachings would have suggested to an ordinarily skilled artisan. See In re
Keller, 642 F.2d 413, 425 (CCPA 1981).
Accordingly, some of the devices useable with the
Wood/Antonio/Odagiri card reader device may produce AC power,
requiring rectification, and including a rectifier in these scenarios is not
“superfluous” as Patent Owner contends. PO Reply 24. As such, we accept
Dr. Thompson’s statements that “rectifier circuity was well known” to an
ordinarily skilled artisan to rectify a signal from AC to DC, and that “a
rectifier might be needed to convert the received signal to useable power for
the external device.” 3d Thompson Decl. ¶ 24; see also id. ¶ 26 and 3PR
Response 9–10.
We, however, disagree that these statements further demonstrate that
“a person o[f] ordinary skill in the art could have selected any number of
different circuits to accomplish this task,” and that such a circuit includes
audio channel circuits. 3d Thompson Decl. ¶ 24. Namely, Dr. Thompson
asserts that “it would have been merely design choice to select either the left
audio contact only, the right audio contact only, or both . . . to connect the
rectifier circuitry in order to produce power[.]” Id. Absent from the record
is a teaching or suggestion in the prior art that would lead one skilled in the
art to have placed a rectifier within one of the recited audio channel circuits
of the Wood/Antonio/Odagiri card reader device as opposed to other
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locations between the host device and the card reader device. See In re Chu,
66 F.3d 292, 299 (Fed. Cir. 1995) (citing In re Gal, 980 F.2d 717 (Fed. Cir.
1992)).
To Patent Owner’s point (see PO Reply 10), Wood, Antonio, and
Odagiri do not discuss a rectifier within its system. Nor does the
additionally cited reference, Sander, for that matter. Id. at 24. And even if
one skilled in the art could have selected from any number of different
circuits to rectify, this does not demonstrate adequately that one skilled in
the art would have selected to place a rectifier within at least one of the left
or right channel circuit as recited. We thus conclude that the placement of
the rectifier within one of the recited channel circuits based on the prior art
would not have been well-known or merely a matter of design choice as
argued by Requester.
Additionally, the ’248 patent’s disclosure suggests that the output of
audio channels 204 and 206 or the data transfer clock generated from DAC
(Digital to Analog Converter) 208 are rectified or are rectified soon after
being outputted or generated. The ’248 patent 8:52–54, 8:67–9:1, Fig. 8.
The ’248 patent also discusses an advantage for using audio channels to
transmit power, including using both channels to double the power to the
reader device. Id. at 8:52–60. As such, there is some evidence in the record
that the specific placement of the rectifier within its system has a benefit and
is not a mere design choice. See Ex parte Kuhle, 526 F.2d 552, 555 (CCPA
1975). We therefore agree with the Examiner that sole reliance on Dr.
Thompson’s testimony concerning placement of the rectifier within the
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audio channels as recited is inadequate to establish a prima facie case of
obviousness for claim 15.
Notably, bodily incorporation is not necessary in an obviousness
rejection. Even so, in contrast with Requester’s contentions (see 3PR
Response 26), we determine that one skilled in the art would have
recognized various locations for placing a rectifier in the Wood, Antonio,
and Odagiri system between where the power is generated in the host device
and received by the integrated circuit of the card reader device as recited in
claim 15. See, e.g., Antonio ¶¶ 3, 39, 41–43; Fig. 3, cited in Op. 32–33, and
Odagiri ¶¶ 161–62, 237, Figs. 2–3, 7, 22, cited in Op. 32–33. Requester
even argues that the location of the rectifier is more obvious to be placed in
the host device than the card reader as recited in claim 15. 3PR Response 7
(stating “if one had to guess as to the location of an undescribed rectification
configuration, it would be the host . . . not the ‘simple’ reader device . . . .”).
Even further, one skilled in the art would have recognized a rectifier to
rectify the power signal could be placed between the host device and the
card reader device in the combined Wood/Antonio, and Odagiri system.
Requester has also provided insufficient evidence that Wood,
Antonio, Odagiri, and Sander teach the limitations of claims 16 and 18
because of their dependency on claim 15.
We thus determine the rejection as proposed on the record does not
provide a sufficient reason with a rational underpinning to have “at least one
of the left channel circuit and the right channel circuit [of the card reader
device] comprise a rectifier configured to rectify an audio output signal
received from the associated audio output channel [of the host device] to
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provide power to the integrated circuit device” as recited in claim 15. Based
on our conclusion, we need not address the evidence related to
nonobviousness for claims 15, 16, and 18.
Accordingly, we affirm the Examiner’s decision not to adopt to the
rejection of Wood, Antonio, Odagiri, and Sander for claims 15, 16, and 18.
b. Claim 20
Claim 20 depends from claim 14 and differs in scope from claim 15
only reciting “the card reader device is configured to rectify the data transfer
clock received from the host device to provide power to the integrated
circuit device.” For claim 20, the Examiner relies on the same reasoning as
that discussed for claim 15 in concluding that the claim limitation “wherein
the card reader device is configured to rectify the data transfer clock
received from the host device to provide power to the integrated circuit
device” is not obvious. Ex. Deter. 12–13.
For reasons similar to those discussed above, we agree that the record
does not demonstrate one skilled in the art would have recognized to include
a card reader device configured to rectify the data transfer clock received
from the host device. To reiterate, the specific location of the rectifier is not
taught or suggested by the cited prior art. Similarly, the specific signal to
rectify is not taught or suggested by the cited prior art. Likewise, similar to
that explained above, there is insufficient evidence that the specific signal in
claim 20 received from the host device to rectify to provide power to the
integrated circuit is a mere design choice as Dr. Thompson testifies.
We affirm the Examiner’s decision not to adopt to the rejection of
Wood, Antonio, Odagiri, and Sander for claim 20.
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2. Wood, Antonio, Odagiri, and Jones
a. Claims 15, 16, and 18
In addition to the limitation noted above, claim 15 further recites “a
TRS-style socket having . . . a third contact of the four contacts is coupled to
a microphone input channel of the host device.” The Examiner determines
that the Requester’s response and the Third Thompson Declaration is not
convincing to adopt the proposed rejection based on the cited references and
what Dr. Thompson testifies. Ex. Deter. 13. In particular, the Examiner
concludes that the proposed rejection of Wood, Antonio, Odagiri, and Jones
does not address the recited “third contact of the four contacts is coupled to a
microphone input” as recited in claim 15. Id. (citing 3d Thompson Decl.
¶ 30). The Examiner further states that Jones does not teach “the audio input
feeding the rectifier formed of diodes 214 and 216 is a left or right channel
circuit.” Id.
Concerning the disputed limitations, Requester states (1) Odagiri
teaches powering an external device from a host device over an audio output
plug and (2) Jones teaches an audio signal that powers a headset and a
rectifier in the headset that rectifies an audio signal providing the power.
3PR Response 29–31 (citing Jones ¶¶ 92–93, 99, 101). Requester further
provides testimony of Dr. Thompson, stating that it would have been
obvious to one skilled in the art to modify the Wood/Antonio/Odagiri
combination to include Jones’ teachings to transform power provided by the
host device that is useable with an external device. Id. at 29 (citing 3d
Thompson Decl. ¶ 32).
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Patent Owner presents the same arguments as those presented for the
rejection of Wood, Antonio, Odagiri, and Sander. See PO Reply 9–12. This
includes that the Wood/Antonio/Odagiri system already provides DC power
and thus adding a rectifier to this system is not necessary and relies on
impermissible hindsight. See id. at 10, 26. However, as noted above, there
is insufficient evidence to support this position. Moreover, as noted above,
some of the host devices useable with the Wood/Antonio/Odagiri system
may generate AC power and require rectification. As such, we are not
persuaded that including a rectifier as taught by Jones into the
Wood/Antonio/Odagiri combination would have involved impermissible
hindsight as asserted.
Even so, we disagree that the rejection as proposed provides a
sufficient reason with a rational underpinning for placing the rectifier in at
least one of the left or right channel circuit as recited in claim 15. Turning to
Requester’s position, Jones teaches using power from an external source
along the channels that are used for audio signals and including a rectifier
(e.g., diodes) within such an audio channel. See Jones ¶¶ 92–93, 99, 101,
cited in 3PR Response 29–31. Thus, unlike the proposed rejection based on
Wood, Antonio, Odagiri, and Sander, this rejection has a teaching in the
prior art of using a rectifier. Moreover, Jones teaches using a rectifier within
an audio channel (Jones ¶¶ 92–93, 99, 101) such that an audio output signal
is configured to be rectified as claim 15 recites.
However, as the Examiner notes, the combination requires a particular
output plug/socket arrangement due, in part, to the recited functional
limitation of the TRS-style plug “adapted to be inserted into a TRS-style
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socket having four contacts” and “the output plug is connected to the
integrated circuit device via . . . a microphone input circuit.” See Ex. Deter.
13–14. The proposed rejection does not address sufficiently how the
combined arrangement teaches these features. See 3PR Response 31 (citing
Jones ¶ 19, Antonio ¶ 39, and 3d Thompson Decl. ¶¶ 30–31 for the newly
recited output plug features). That is, the cited passages of Jones and
Antonio do not address adequately the third contact of the TRS-style socket
coupled to a microphone input channel of the host device or the output plug
device being connected to the integrated circuit device through a
microphone input circuit as amended in claim 15. See Jones ¶ 19 and
Antonio ¶ 39.
Dr. Thompson also does not address these features when discussing
Jones and what would have been common in the art. See 3d Thompson
Decl. ¶¶ 30–31. That is, Dr. Thompson discusses a ground, a right channel,
a left channel, and a power contact. See id. ¶¶ 30, 33. Notably, the power
contact is discussed separately from the right and left channels of an audio
jack (see id. ¶¶ 30, 33), when in fact, claim 15 requires the at least one of the
right or left audio channels of the plug is configured to receive the audio
output signal that provides power to the integrated circuit of the card reader
device. Also, the “microphone input circuit of the host device” and a
separately, recited “microphone input circuit” that connects the output plug
to the integrated circuit device in claim 15 are not discussed sufficiently by
Dr. Thompson. See id. ¶¶ 28–33. We thus determine that the rejection as
proposed does not disclose or render obvious an output plug that is (1)
adapted to be inserted into a TRS-style socket having a third contact coupled
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to a microphone input channel of the host device and (2) connected to the
integrated circuit device through a microphone input circuit, such that a
prima facie case of obviousness for claim 15 is established.
Due to their dependency on claim 15, Requester also has not
established a case of obviousness that Wood, Antonio, Odagiri, and Jones
teach the limitations of claims 16 and 18.
Accordingly, we affirm the Examiner’s decision not to adopt to the
rejection of Wood, Antonio, Odagiri, and Jones for claims 15, 16, and 18.
b. Claim 20
Claim 20 recites, in relevant part, “the card reader device is
configured to rectify the data transfer clock received from the host to
provide power to the integrated circuit device.” Regarding this claim, the
Examiner expressed issues with relying on various distinct embodiments in
Jones in formulating the obviousness rejection. Ex. Deter. 13. The
Examiner also discusses the limitation of claim 20 reciting “the host device
can receive synchronous data from the integrated circuit device on the
microphone input channel” and how Jones failing to teach the microphone
input channel is “a defect in the rejection.” Id. at 13–14.
As formulated, Requester relies on the “analysis of claim 18” for the
proposed rejection of claim 20 as well as Antonio’s teachings of conveying
data on the microphone input channel. 3PR Response 33. When addressing
claim 18 in turn, the proposed rejection discusses (1) Figure 20 of Odagiri
teaching supplying a clock signal (id. at 32–33 (citing Odagiri ¶ 227, Fig.
20) and (2) such a clock signal, in a stereo headphone embodiment, would
have been transferred through the left and right channel (3PR Response
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32–33 (citing 3d Thompson Decl. ¶ 28)). The proposed rejection also
determines (1) it would have been obvious to rectify Odagiri’s clock signal
provided by the host device to place the signal in a proper form for powering
the digital signal camera (3PR Response 34 (citing 3d Thompson Decl.
¶¶ 32–33)), and (2) Jones describes rectifying a square wave (3PR Response
34 (citing Jones ¶ 97)).
As indicated above, we accept Dr. Thompson’s statements related to a
rectifier to rectify a signal is well-known to an ordinarily skilled artisan. 3d
Thompson Decl. ¶ 31; see also 3PR Comments 9–10. Yet, this evidence
alone does not demonstrate persuasively that configuring the card reader
device to rectify the data transfer clock received from the host device is
known, such that the proposed combination “represents nothing more than
combining known techniques in a known manner to yield predictable
results,” as Dr. Thompson contends. 3d Thompson Decl. ¶ 33.
Absent from the record is a teaching or suggestion in the prior art that
would have led one skilled in the art to have arranged the card reader device
to be configured to rectify the data transfer clock suggested by Odagiri. See
3PR Response 33–34. Although Odagiri teaches clock signals are known,
there is an inadequate teaching or suggestion to rectify this particular signal
to provide power to an integrated circuit device. See Odagiri ¶ 227, Fig. 20,
cited in 3PR Response 33 and 3d Thompson Decl. ¶ 28. Dr. Thompson
further discusses Jones teaches using audio signals to provide power and
rectify this signal but does not provide a reason to rectify a data transfer
clock as recited in claim 20. 3d Thompson Decl. ¶ 32 (citing Jones ¶¶ 92,
101), cited in 3PR Response 34.
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Dr. Thompson further turns to Jones and asserts the reference suggests
converting various signal, including a clock signal, to provide power to an
external device. 3d Thompson Decl. ¶¶ 32–33 (citing Jones ¶¶ 97, 99, 101).
Yet, we find no such suggestion to use a signal other than audio signals in
the cited passages of Jones. See Jones ¶¶ 97, 99, 101. Moreover, even if the
clock signal taught in Odagiri is a square wave, we disagree that “Jones
motivates this combination insofar as Jones described rectifying a square
wave using diodes and capacitors to produce the power.” 3PR Response 34
(citing Jones ¶ 97). Also, the statement from Dr. Thompson that “it is well
known that in providing power to a peripheral device, . . . some other type of
signal conditioning may be required” (3d Thompson Decl. ¶ 34) does not
sufficiently supply a reason with a rational underpinning to rectify
specifically the data transfer clock as recited in claim 20.
We thus determine the rejection as proposed does not teach or suggest
“the card reader device is configured to rectify the data transfer clock
received from the host device to provide power to the integrated circuit
device” as recited in claim 20. Accordingly, we affirm the Examiner’s
decision not to adopt to the rejection of Wood, Antonio, Odagiri, and Jones
for claim 20.  
C. Written Description Rejections
1. Claim 15
Amended claim 15 depends from claim 14 and recites, in pertinent
part:
wherein the output plug is a TRS-style plug and further
adapted to be inserted into a TRS-style socket having four
contacts,
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wherein a first contact of the four contacts is coupled to
the left audio out channel of the host device,
a second contact of the four contacts is coupled to the
right audio out channel of the host device,
a third contact of the four contacts is coupled to a
microphone input channel of the host device, and
a fourth contact of the four contacts is coupled to a
ground of the host device;
wherein the output plug is connected to the integrated
circuit device via a left channel circuit, a right channel circuit,
and a microphone input circuit, and
wherein at least one of the left channel circuit and the
right channel circuit comprises a rectifier configured to rectify
an audio output signal received from the associated audio
output channel to provide power to the integrated circuit device,
wherein an audio output signal is a signal generated by audio
circuitry, and
wherein the microphone input circuit is the onlv circuit
configured for providing a signal from the integrated circuit to
the host device[.]

PO Request 5 (underlying indicating amended language).
a. “A TRS-style plug”
The Examiner determines that the phrase “TRS-style plug” in
amended claim 15 does not have adequate written description support in the
’248 patent. Ex. Deter. 6–7. Specifically, the Examiner states that the
phrase, “TRS-style plug,” “does not exclude connectors that are not TRS
connectors but have unnamed traits[.]” Id. at 6
To satisfy the written description requirement, a patent specification
must describe the claimed invention in sufficient detail that one skilled in the
art can reasonably conclude that the inventor had possession of the claimed
invention. See Moba, B.V. v. Diamond Automation, Inc., 325 F.3d 1306,
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1319 (Fed. Cir. 2003). Upon review, the ’248 patent does not describe the
recited phrase, “TRS-style plug,” in sufficient detail such that one skilled in
the art would have reasonably concluded that the inventor had possession of
this claimed feature.
We begin by noting that Figure 8 of the ’248 patent is described as “a
further detailed schematic diagram of the card reader shown in FIG. 6.” The
’248 patent 4:8–9. As such, we disagree with the Examiner’s statement that
“claims 14–20 must correspond to the embodiment of Figure 8 of the ’248
patent” (Ex. Deter. 6) and that “the disclosures within the ’248 patent of a
TRS connector that refer to embodiments of other Figures cannot be
assumed to be applicable to Figure 8” (id. at 6–7), to the extent the Examiner
intended to exclude Figures 6 and 7. The ’248 patent 4:3–9 (describing
Figures 6–8 as the same embodiment).
Although having support for a TRS (tip, ring, sleeve) plug (the ’248
patent 4:25–28, 7:5–7), there is insufficient detail in the ’248 patent’s
disclosure describing the style of the reader’s output plug encompassed by a
“TRS-style” plug. As noted by the Requester, this claim limitation permits
variations in the TRS plug structure without a disclosure providing sufficient
guidance concerning what structure(s) may be covered by a plug styled like
a TRS-plug but that is not a TRS plug. See 3PR Response 14, cited in Ex.
Deter. 9.
Patent Owner cites to various portions of the ’248 patent for written
description support of the language “TRS-style plug.” PO Comments 11–13
(citing the ’248 patent 6:67–7:11, 8:34–39, 46–60, Figs. 6–8). Within these
passages, the ’248 patent describes “a TRS (tip, ring sleeve) connector also
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known as an audio jack, phone plug, jack plug, stereo plug, mini-jack, or
mini-stereo audio connector.” The ’248 patent 7:6–8; see also the ’248
patent 8:46–48, Figs. 6, 8. Granted, the ’248 patent describes jack 156 as a
TRS connector and provides a lists of such connectors. However, Patent
Owner contends that a TRS-style plug should include “a plug whose
contacts consist of a single tip, ring(s), and a single sleeve.” PO Comments
7. Specifically, Patent Owner discusses that TRS plugs include “a mono
TRS-style plug/socket” that has a single ring and “a stereo TRS-style
plug/socket” that has two rings. Id. at 7–8.
Patent Owner explains that “[t]he term ‘TRS’ is generically used in
common parlance to mean . . . a TRS plug/socket having contacts consisting
of a tip, ring(s), and a sleeve.” Id. at 8. But, the cited passages in the ’248
patent describe only TRS connectors without providing adequate details
concerning output plugs that are not TRS connectors but have traits that are
styled as TRS plugs (i.e., “a TRS-style plug”) as recited in claim 15. See
3PR Response 14. As such, the ’248 patent does not describe a TRS plug
that has more than one ring as argued, such that the disclosure has sufficient
detail that one skilled in the art would have reasonably concluded that the
inventor has possession of the claimed invention of “a TRS-style plug” that
has one or more rings as Patent Owner contends.
Nor has Patent Owner provided other convincing evidence that the
listed jacks, plugs, or connectors would have been recognized by one skilled
in the art to be styled as a TRS plug having more than one ring. For
example, Patent Owner further turns to a discussion in the ’248 patent
stating that host device 160 can be an “iPod touch.” PO Comments 11–13
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(citing the ’248 patent 6:67–7:11). Patent Owner argues that such a device
inherently has “a TRS-style socket . . . having a tip, two rings, [and] sleeve
contacts[.]” PO Comments 12. Even assuming this is true, the iPod touch
device does not demonstrate the properties of the disclosed card reader’s
output plug.
Moreover, Patent Owner’s assertion that such a device is “well-known
. . . and inherently has a tip, two rings and a sleeve contacts” is unsupported
with evidence other than counsel’s assertions. PO Comments 8. Such
arguments cannot take the place of factually supported objective evidence.
See In re Huang, 100 F.3d 135, 139–40 (Fed. Cir. 1996); see also 3PR
Reply 7. In contrast, Requester includes testimony from Dr. Thompson,
indicating the phrase “TRS-style plug” is not a known term of art. 3d
Thompson Decl. ¶ 14. Dr. Thompson further concludes (1) the ’248 patent
provides the ordinary, skilled artisan with little guidance as to the structure
of such a TRS-style plug, and (2) given this scant guidance, one skilled in
the art would not understand the scope of what is being claimed. Id.
On balance, the evidence of record favors the Examiner’s
determination that the ’248 patent’s disclosure fails to provide sufficient
details of what structure or what traits are encompassed by “a TRS-style
plug” in claim 15 such that one skilled in the art would not have reasonably
concluded the inventor had possession of the claimed feature.
b. “TRS-style socket having four contacts”
The Examiner further determines that, even if Figure 8 of the
disclosure has a TRS connector, the ’248 patent does not support a TRS
connector as recited with four contacts connected as recited. Ex. Deter. 7.
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To be clear, amended claim 15 recites the “TRS-style plug” of the card
reader device is “further adapted to be inserted into a TRS-style socket
having four contacts.” As such, claim 15 recites a socket— not the plug of
the card reader —having four contacts as recited.
Given this understanding, we agree that there is insufficient detail in
the ’248 patent that one skilled in the art would have reasonably concluded
that the inventor has possession of “a TRS-style socket having four contacts”
as recited. As discussed above, the ’248 patent does not provide adequate
detail of what structure or traits are encompassed by a plug styled as a TRS
plug but that is not a TRS plug. See the ’248 patent 8:34–39, 49–60, Figs.
6–8, cited in PO Comments 11–12. For similar reasons, we determine the
’248 patent does not have adequate detail of what traits or structure make up
a socket styled as a TRS socket.
To be sure, the ’248 patent describes jack 202 of the host device (e.g.,
160) connected to three channels (e.g., left audio out channel (e.g., 204),
right audio out channel (e.g., 206) and microphone input channel (e.g., 216))
and a ground (unlabeled in Fig. 8). The ’248 patent 8:34–39, 43–46, Fig. 8.
However, there are insufficient details describing jack 202 as a TRS-style
socket and what structure or traits would be encompassed by such a style.
See id. At best, one skilled in the art would have reasonably concluded,
based on the previously discussed TRS plug in the ’248 patent, that such a
TRS socket would correspond with the TRS (tip, one ring, and sleeve) plug.
Patent Owner argues that the discussion of the iPod touch in the ’248
patent supports that the disclosure has written description support for the
recited “TRS-style socket having four contacts.” See PO Comments 12.
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Yet, as previously stated, Patent Owner provides insufficient supporting
evidence for this position other than attorney argument.
On balance, the evidence of record favors the Examiner’s
determination that the disclosure of the ’248 patent fails to provide sufficient
details of what structure or what traits are encompassed by “a TRS-style
socket” as recited in claim 15 such that one skilled in the art would not have
reasonably concluded the inventor had possession of the claimed feature.
c. “[A] rectifier”
Amended claim 15 recites “at least one of the left channel and the
right channel circuit comprises a rectifier configured to rectify an audio
output signal received from the associated audio output channel to provide
power to the integrated circuit device[.]” The Examiner determines that the
phrase “rectifier” in claim 15 is disclosed in the ’248 patent, and a rejection
under 35 U.S.C. § 112, first paragraph (written description), is not
appropriate based solely on the rectification component of the rectifier. Ex.
Deter. 9. Yet, the Examiner determines “the manner in which [the rectifier]
is connected is a separate issue[.]” Id.
We are unclear as to the Examiner’s position concerning this
limitation and whether there is an outstanding rejection under § 112, first
paragraph. Requester explains the ’248 patent fails to provide written
description support regarding where the rectifying functionality should be
implemented, unlike claim 15. 3PR Response 11–12; see also 3PR Reply
9–10 (discussing the “rectifier” limitation and claim 15). But, the Examiner
does not refer to the Requester’s position when discussing how the rectifier
is connected or the “separate issue.” Ex. Deter. 9.
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Referring to “section IV,” the Examiner states the ’248 patent
“disclose[s] a rectifying function which serves to disclose the presence of a
rectifier.” Id. The referred-to Section IV of the Examiner’s Determination
discusses Wood, Antonio, and Odagiri when addressing claim 15 and does
not discuss any lack of written description support for the “rectifier”
limitation. Ex. Deter. 5. Moreover, presuming that the Examiner is
referring to Section V, this portion indicates that claim 20 has support in the
’248 patent. See Ex. Deter. 7.
Given that we cannot determine the Examiner’s basis for this
rejection, we do not sustain any purported rejection that may have been
presented concerning this limitation. However, as discussed below in more
detail when addressing claim 20, we present a new rejection under 35 U.S.C.
§ 112, first paragraph, for the recitations of the “rectifier” in claim 15 and
“the card reader device is configured to rectify” in claim 20.
d. “[A]udio circuitry”
Amended claim 15 recites “a rectifier configured to rectify an audio
output signal received from the associated audio output channel to provide
power to the integrated circuit device, wherein an audio output signal is a
signal generated by audio circuitry.” The Examiner determines the ’248
patent’s disclosure fails to support the phrase “the audio circuitry” in claim
15. Ex. Deter. 10 (incorporating 3PR Response 15–16). In its response,
Requester states that there is no discussion of “‘audio circuitry’ whatsoever”
in the ’248 patent. 3PR Response 15–16 (citing the ’248 patent 4:40–5:12,
Fig. 2).
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We agree that there is no explicit discussion of an “audio circuitry” in
the ’248 patent. See generally the ’248 patent. But, Patent Owner contends
that the recited audio circuity is inherently part of host device 160, such as
DAC 208 and microprocessor (µP) 210. PO Comments 12, 15 (citing the
’248 patent 8:50–60).
Amended claim 15 recites the output plug of the card reader is
connected to the integrated circuit device of the card reader through the left
or right channel circuit, which comprises a rectifier configured to rectify an
audio output signal. See id. On the other hand, the “audio output signal”
that is “configured to rectify” is “received from the associated audio output
channel.” The phrase “the associated audio output channel” in claim 15
(italics added) is understood to refer to the recited “left” or “right audio out”
channels of the host device also newly recited in claim 15. As such, the
received “audio output signal” from the associated audio out channel of the
host device, as recited, would be located in the host device as Patent Owner
urges.6
The details of what “audio circuitry” is used to generate this “audio
output signal” are not provided. See generally ’248 patent. On the other
hand, the ’248 patent discusses DAC 208 and µP 210 shown in Figure 8
connected to the audio out channels 204 and 206. The ’248 patent 8:39–43.

6 Additionally, “an audio output signal is a signal generated by audio
circuitry” in amended claim 15 (italics added) does not refer back to the
“audio output signal received from the associated audio output signal.”
However, for purposes of the written description rejection, we presume
Patent Owner intended to recite — the audio output signal is a signal
generated by audio circuitry — instead of “an audio output signal is a signal
generated by audio circuitry.”
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Similarly, the ’248 patent discusses that DAC 208 can be “more than one
DAC.” Id. at 8:43. Finally, the ’248 patent discuses stereo audio outputs
(e.g., channels 204, 206) can be combined to double the power to reader
device 150. See id. at 4:58–60. We thus determine various passages from
the ’248 patent support some type of “audio circuitry” generates “an audio
output signal received from the associated audio output to provide power to
the integrated circuit device” as recited.
Based on the record, we do not sustain the written description
rejection concerning the “audio circuitry” limitation in claim 15.
e. “[T]he microphone input circuit is the only circuit configured for
providing a signal from the integrated circuit to the host device”
Lastly, the Examiner determines the phrase, “the microphone input
circuit is the only circuit configured for providing a signal from the
integrated circuit to the host device” in amended claim 15 is not supported.
Ex. Deter. 10 (incorporating 3PR Response 15). Requester cites to the
disclosure of the ’248 patent, contending there is nothing in this portion
indicating that communication from integrated chip (IC) 168 is limited to
microphone input 216. 3PR Response 15 (citing the ’248 patent 8:64–67).
We agree with Requester.
Claim 15 recites “a signal from the integrated circuit to the host
device” without specifying the type of signal. Thus, the breadth of “the only
circuit configured for providing a signal” does not exclude audio signals.
The ’248 patent shows and describes various circuits, including audio
channels (e.g., 220, 222) as well as a microphone input (e.g., 224), that are
configured to provide a signal from the integrated circuit of the card reader
(e.g., 168) to the host device (e.g., 160). See the ’248 patent 8:49–50, Fig. 8.
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We therefore disagree with Patent Owner that Figure 8 supports “the only
circuit” language found in amended claim 15. PO Comments 13–14.
Rather, as indicated above, one skilled in the art would not have reasonably
concluded that the ’248 patent demonstrates the inventor had possession of
claim language where “the microphone input circuit” of the card reader is
the only circuit configured for providing a signal from the integrated circuit
to the host device.
Patent Owner argues that Figure 8 supports “the only circuit”
language found in amended claim 15. Id. at 13–14. In particular, Patent
Owner argues that the audio signal uses left channel and right channel 220,
222 from host device 160 to card reader 150 to provide power, but does not
disclose providing a signal in the opposite direction from the integrated
circuit to the host device. See id. However, Patent Owner does not provide
a citation from the ’248 patent or further evidence, such as testimony from
an expert, to support this position. Rather, Patent Owner relies on attorney
arguments, which alone we find unpersuasive. Moreover, the breadth of
claim 15 requires only that the microphone input circuit is configured for
providing a signal.
In addition, the ’248 patent discusses providing power through only
one audio channel, freeing the second audio channel for providing a signal
from the integrated circuit to the host device. See the ’248 patent 8:50–54.
There also is no discussion in the ’248 patent that prevents the audio
channels from operating bi-directionally at different times. See generally id.
That is, the ’248 patent describes providing a data transfer clock and serial
data stream to IC 168 from DAC 208 in host device 160 while receiving
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synchronous data from IC 168 through microphone input 216. Id. at 8:64–
67. But, this example in the ’248 patent does not exclude other signal
arrangements at other times, including using the right or left channel circuit
to provide signals from the integrated circuit to the host device.
By stating “Requester is correct” and incorporating page 15 of
Requester’s Response, the Examiner implies the ground circuit shown in the
’248 patent may also provide a signal from the reader’s integrated circuit to
the host device as recited. Ex. Deter. 10 (incorporating 3PR Response 15).
On this finding, we agree with Patent Owner that the ground shown in the
’248 patent does not provide a signal to the host device but is a reference
voltage for signals. PO Comments 14.
In conclusion, we agree with the Examiner that the ’248 patent does
not demonstrate sufficient detail that one would have reasonably concluded
the inventor had possession of the recitation that “the microphone input
circuit is the only circuit configured for providing a signal from the
integrated circuit to the host device” in amended claim 15.
2. Claims 16 and 18
Claim 16 depends from claim 15 and also includes the phrases “TRS-
style socket,” “wherein both of the left channel circuit and the right channel
circuit comprise a rectifier configured to rectify an audio output signal,” and
“an audio output signal is a signal generated by audio circuitry.” Claim 18
depends from claim 15. Although not separately discussed, the Examiner
determines that the citations to the ’248 patent do not “adequately support
the amendments to claims 15–18.” Ex. Deter. 6. Thus, for the above
reasons and due to their dependency, we also sustain the Examiner’s
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rejection of claims 16 and 18 under 35 U.S.C. § 112, first paragraph. As
discussed below, we present a new rejection for the limitations “wherein
both of the left channel circuit and the right channel circuit comprise a
rectifier configured to rectify an audio output signal” in claim 16 under 35
U.S.C. § 112, second paragraph.
3. Claim 20
Claim 20 depends from claim 14 (not claim 15) and recites further
“wherein the card reader device is configured to rectify the data transfer
clock received from the host device to provide power to the integrated
circuit device.” The Examiner determines that the ’248 patent has sufficient
support for this recitation and does not reject the claim under 35 U.S.C.
§ 112, first paragraph. Ex. Deter. 7 (quoting the ’248 patent 8:52–54,
8:67–9:1 and citing Fig. 8). Patent Owner agrees. PO Comments 18–19
(citing the ’248 patent 8:61–9:10). Patent Owner contends that the ’248
patent supports “a rectifier” in the card reader. PO Reply 5–8, 21 (citing the
’248 patent 8:48–57, 8:67–9:1, § 1.2 of PO Reply (citing the ’248 patent
8:49–9:10), and § 3.3.1 of Patent Owner’s Comments); PO Response 8
(citing the ’248 patent 8:67–9:10).
Requester, on the other hand, contends that the ’248 patent’s
disclosure does not provide adequate details such that one skilled in the art
would have concluded that the inventor had possession of the disputed
language in claim 20. 3PR Comments 6–7. Specifically, Requester points
out that the cited portions describe rectifying generally but “there is simply
no disclosure of . . . whether it would be located in the host or card reader, or
whether there would be devices in multiple host channels as recited in claim
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16.” Id. at 7. Requester even further argues that one would have concluded
that rectification would have occurred in the host device based on Patent
Owner’s simple design for the card reader. See id.
We agree with Patent Owner (PO Comments 18–19) and the
Examiner (Ex. Deter. 7) that the ’248 patent supports the concept of
rectifying data to provide power to IC 168 of the card reader. However,
ultimately, we agree with Requester that the ’248 patent does not provide
sufficient detail that such rectification happens in a specific location, such as
the card reader as claim 20 recites.
Two particular passages in the ’248 patent discuss rectifying data
signals. The ’248 patent 8:52–54, 9:67–7:1. The second passage
specifically discusses the data transfer clock recited in claim 20. Id. at
8:64–9:1. Here, the ’248 patent states host device 160 provides a data
transfer clock to IC 168 of the card reader from DAC 208 of the host device.
Id. at 8:64–67, Fig. 8. One skilled in the art would have understood that the
data transfer clock is provided at the host device’s DAC 208. Id. Yet, the
passage that follows from column 8, line 67 states the data transfer clock
could be rectified to provide power to IC 168 without any details concerning
where the rectification occurs. Id. at 8:67–9:1. That is, as described,
rectification could occur anywhere between DAC 208 in the host device and
IC 168 in the card reader, as well as adding a separate rectifying component
between the host device and the card reader. See id. at 8:64–9:1, Fig. 8.
The other passage in the ’248 patent concerning rectification states
that one of audio channels 204 or 206 of host device 160 can be
programmed to output a waveform that is readily rectified to provide power
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to IC 168. Id. at 8:53–54, Fig. 8. This passage could be read in one or two
ways. First, given the past tense in the sentence (e.g., “is . . . rectified”), one
skilled in the art may understand the ’248 patent has support that the host
device—not the card reader device as recited—is configured to rectify an
output waveform (e.g., a data transfer clock). Id. Second, the term
“readily”7 in the context of “to output a waveform that is readily rectified” of
the ’248 patent (id. at 8:53–54) could be understood by one skilled in the art
to mean the output is rectified without delay rather than the output has been
rectified. See id. Given this ambiguity, the ’248 patent, once again, fails to
disclose a location for the rectification such that the disclosure shows the
inventor had possession for the recitation “the card reader device is
configured to rectify the data transfer clock” in claim 20.
Additionally, Requester discusses Ariad Pharm., Inc. v. Eli Lilly &
Co., 598 F.3d 1336, 1349 (Fed. Cir. 2010). 3PR Response 11–12.
Requester quotes from a portion of Ariad related to “‘genus claims.’” 3PR
Response 11. However, as discussed above, claim 20’s recitation is more
accurately described as a claimed species of the generically discussed
“rectifier” between DAC 208 and IC 168. That is, as previously explained,
claim 20 recites a specific location of the rectifying function (i.e., in the card
reader) whereas the ’248 patent’s disclosure fails to discuss this specific

7 The American Heritage Dictionary of the English Language, defining
“readily” as “1. Without hesitation; willing . . . 2. Without difficulty; easily,”
available at https://www.ahdictionary.com/word/search.html?q=readily (last
visited Jan. 11, 2017); Collins English Dictionary, defining “readily” as “1.
promptly; eagerly; willing 2. Without difficulty or delay; easily or quickly,”
available at https://www.collinsdictionary.com/dictionary/english/readily
(last visited Jan. 11, 2017).
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location where rectifying occurs. See the ’248 patent 8:53–54, 8:64–9:1.
Moreover, the fact that the rectifying function may be within the card reader
as described does not demonstrate that the ’248 patent describes in sufficient
detail that the inventor had possession of the claimed “card reader [being]
configured to rectify the data transfer clock from the host device” as recited
in claim 20. See also In re Smith, 458 F.2d 1389, 1395 (CCPA 1972)
(noting that a subgenus is not necessarily described by a genus
encompassing it and a species upon which it reads)
The “rectifier” recited in amended claims 15 and 16 suffers from a
similar issue. For example, claim 15 recites “at least one of the left channel
circuit and the right channel circuit [that connects the output plug to the
integrated circuit device] comprises a rectifier configured to rectify an audio
output signal.” Because the output plug and integrated circuit as recited are
within the card reader device, the recited left and right channel circuits are
also located within the card reader device. As stated above, the disclosure
does not support the specific location of a rectifier within the card reader
device such that one would have reasonably concluded that the inventor had
possession that the recited “rectifier” is necessarily located in a right or left
channel circuit (claim 15) or both channel circuits (claim 16) within the card
reader device between the card reader’s output plug and the integrated
circuit as recited.
Accordingly, we determine that the ’248 patent does not demonstrate
sufficient detail that one would have reasonably concluded the inventor had
possession of the recitations “at least one of the left channel circuit and the
right channel circuit comprises a rectifier configured to rectify an audio
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output signal” in amended claim 15, “both of the left channel circuit and the
right channel circuit comprise a rectifier configured to rectify an audio
output signal received from the associated audio output channel to provide
power to the integrated circuit device” in amended claim 16, and “the card
reader is configured to rectify the data transfer clock” in amended claim 20.
This rejection is presented as a new ground. Due the dependency on claim
15, claim 18 is likewise newly rejected under 35 U.S.C. § 112, first
paragraph.
D. Indefiniteness Rejections
1. Claim 15
a. “[A] TRS-style plug”
The Examiner also determined that the phrase “TRS-style plug” in
amended claim 15 is “a vague term that seemingly does not exclude
connectors that are not TRS connectors but have unnamed traits of TRS
connectors.” Ex. Deter. 6. Because the term “TRS-style” is vague, the
Examiner determines that its “meaning is not clearly understood . . . .” Id.
(emphasis added). The Examiner also incorporates pages 13 through 15 of
the Requester’s Response. Id. at 9. In this Response, Requester states that
“the metes and bound of ‘style[]’” are not provided. 3PR Response 14.
Requester specifically relies on Dr. Thompson to support this position,
concluding that the phrases, “TRS-style,” “TRS-style plug,” and “TRS-style
socket” are not terms of art and are subjective. Id. (discussing 3d Thompson
Decl. ¶ 14); 3PR Reply 5.
Additionally, Requester indicates that the term “style” conveys “a
permitted variation in the TRS structure” (3PR Response 14) and the
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disclosure “suggests that TRS plugs . . . vary in structure . . . in some
unknown way . . .” (id. at 15). Addressing a cited portion of the ’248 patent
provided by Patent Owner (id. at 14 (citing the ’248 patent 4:25–29, 7:5–8,
8:34–9:10, Fig. 8, cited in PO Response 8)), Requester contends that the
discussion in column 4 “simply identifies common names for connectors of
a same structure” but does not provide guidance “as to what constitutes a
‘style’ of TRS structure,” further suggesting that the scope of the term is
unclear. 3PR Response 14.
Patent Owner counters that the term “TRS-style” is clear based on the
entire specification and the prosecution history. PO Comments 6 (quoting
Nautilus, Inc. v. Biosig Instruments, Inc., 134 S. Ct. 2120, 2129 (2014)); see
also PO Reply 19. Specifically, Patent Owner contends that the current
comments made in this reexamination proceeding “are part of the
prosecution history.” PO Comments 7. In particular, Patent Owner states
“the phrase ‘TRS-style’ is used in the claims to limit the interpretation of a
TRS-style connector to a male or female connector (e.g., plug, socket) with
contacts consisting of a single tip, one or more rings, and a single sleeve.”
Id. at 8 and PO Reply 19 (underlining omitted). Patent Owner states the
’248 patent describes both “mono and stereo TRS-style connectors” (PO
Comments 8), where the mono TRS-style plug/socket has a single ring, and
the stereo TRS-style plug/socket has two rings. Id. at 7–8. Patent Owner
states the sole “term “TRS’ was not used in the claims to avoid” an
argument that TRS is limited to a single ring. Id. at 8.
Based on the evidence, we agree with the Examiner and Requester
that the phrase “TRS-style plug” is indefinite. “[C]laims are required to be
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cast in clear— as opposed to ambiguous, vague, indefinite— terms. It is the
claims that notify the public of what is within the protections of the patent,
and what is not.” In re Packard, 751 F.3d 1307, 1313 (Fed. Cir. 2014); see
also id. at 1314 (approving of the Board’s proper application of
indefiniteness under the MPEP § 2173.05(e) standard). Additionally, claims
are not read in a vacuum and the decision on whether a claim is indefinite
requires a determination of whether those skilled in the art would have
understood what is claimed when the claim is read in light of the
specification. See Power-One, Inc. v. Artesyn Techs., Inc., 599 F.3d 1343,
1350 (Fed. Cir. 2010).
As indicated by Requester, Patent Owner’s comments included during
this pending reexamination proceeding (see, e.g., PO Comments 6–7) are
not, as of yet, part of the prosecution history. 3PR Reply 5 (citing Marine
Polymer Techs., Inc. v. HemCon, Inc., 673 F.3d 1350, 1374 (Fed. Cir. 2012)
(stating “[w]hile it is true that courts construe prosecution history, they do so
at a time when the record is closed.”)). That is, only after this proceeding is
closed, such comments may be considered a part of the prosecution history
through which the courts determine whether the claims inform the ordinary
artisan about the scope of the invention with reasonable certainty. See
Nautilus, 134 S. Ct. at 2129. Patent Owner’s statements made during this
prosecution are not yet prosecution history for consideration in determining
whether the claims are definite.
We further agree with the Examiner’s determination that the phrase,
“TRS-style plug” is vague and would not have been understood by an
ordinary artisan when read in light of the disclosure. Ex. Deter. 6. That is,
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the disclosure does not address sufficiently or with precision what structure
or traits are covered by a plug styled like a TRS plug. For example, the ’248
patent describes jack 156 as “a TRS (tip, ring, sleeve) connector also known
as an audio jack, phone jack, jack plug, stereo plug, mini-jack, or mini-stereo
audio connector.” The ’248 patent 7:6–8. This passage does not describe
the ring portion of the connector as being one or more. See id. The
discussion of a “stereo plug” in this passage also does not clearly describe to
an ordinary skilled artisan that the ring portion can have or inherently
encompasses two rings as urged by Patent Owner. PO Comments 8.
Figure 8 also does not shed any additional information of what a plug
styled as a TRS plug or the recited “TRS-style plug” is. The ’248 patent,
Fig. 8. Column 8, line 34 through column 9, line 10 describes Figure 8 but
does not add to our understanding of “a TRS-style plug.” Id. at 8:34–9:10.
In fact, plug 200 is again described as “an audio jack, phone jack, jack plug,
stereo plug, mini-jack, or mini-stereo audio connector” without any details
concerning the number of rings or what is encompassed by the scope of a
plug styled as a TRS plug. See id. at 8:46–48.
Patent Owner further contends that the discussed iPod touch device in
the ’248 patent is well-known and inherently has two rings. PO Comments
8, 11–12 (citing the ’248 patent 6:67–7:10). However, as Requester
indicates, Patent Owner’s counsel arrives at this alleged fact without
providing sufficient, supporting evidence. See 3PR Reply 4. Column 6, line
67 through column 7, line 10 at best describe various host devices (e.g., an
iPod touch, a personal digital assistant, or a device that has WiFi) that can be
used with the card reader. The ’248 patent 6:67–7:5. But this does not
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demonstrate sufficiently TRS plugs that have two rings. See id. The
remaining passage in column 7, as explained above, does not elaborate on
the number of rings in the disclosed TRS connector. Id. at 7:5–10.
Moreover, and even assuming that an iPod touch requires a jack
having two rings, we disagree that an ordinarily skilled artisan would have
understood the phrase, “TRS-style plug” in claim 15, includes one or more
rings as Patent Owner asserts. See PO Comments 8 and PO Reply 19. That
is, the boundaries of the recited “TRS-style plug” in claim 15 are unclear
and not understood by one skilled in the art.
For the above reasons, we agree with the Examiner that the recited
“TRS-style plug” in claim 15 is indefinite.
b. “TRS-style socket”
Claim 15 also recites “a TRS-style socket.” Although not specifically
discussing this limitation, the Examiner states the term “TRS-style” “raises
issues under 35 U.S.C. 112, second paragraph.” Ex. Deter. 9 (incorporating
3PR Response 13–15). Given this statement, we presume that the Examiner
has determined the recitation to the “TRS-style socket” indefinite.
As noted above, Requester states that “there is no description of the
metes and bound of ‘style’” (3PR Response 13–14), “TRS-style plug” is not
a term of art (3PR Response 14 (citing 3d Thompson Decl. ¶ 14)), and the
term “TRS-style” is subjective (3PR Response 14).
For reasons similar to those discussed above regarding the limitation
“TRS-style plug,” we agree with the Examiner that the phrase “TRS-style
socket” is indefinite. Specifically, for similar reasons, we determine that one
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skilled in the art would not have understood the boundaries or the scope of
the complementary “TRS-style socket” and that the phrase is indefinite.
c. “[A] rectifier”
Claim 15 recites “a rectifier configured to rectify an audio output
signal received from the associated audio output channel to provide power to
the integrated circuit device.” Requester argues that this limitation should
be construed as a means-plus-function recitation and invokes 35 U.S.C.
§ 112, sixth paragraph. 3PR Response 11–13. Specifically, Requester
asserts “[t]he term ‘rectifier’ does not convey structure; rather it is merely a
generic placeholder term . . . Amended claim 15 does not modify ‘rectify’
with any other structure that would preclude interpretation of this limitation
as including ‘means-plus-function’ language.” Id. at 11. Requester also
contends that the ’248 patent’s disclosure mentions a rectifying function but
fails to include any corresponding structure. Id. at 12. In Requester’s view,
this limitation is indefinite.
The Examiner disagrees, finding the term “rectifier” in claim 15 is not
“‘a generic placeholder term’ that does not convey structure.” Ex. Deter. 9.
Rather, the Examiner indicates that Requester provides examples of
rectifiers, including diodes. See id. (stating “Requester provides examples of
related devices such as diodes that ‘perform the function of rectifying’”); see
also 3PR Response 11. The Examiner also states that the term “circuit” has
been found to have sufficient structure not to invoke § 112, sixth paragraph.
See Ex. Deter. 9 (citing MIT et al. v. Abacus Software, 462 F.3d 1344,
1354–56 (Fed. Cir. 2006), Linear Tech. Corp. v. Impala Linear Corp., 379
F.3d 1311, 1320–21 (Fed. Cir. 2004), and Apex Inc. v. Raritan Computer,
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Inc., 325 F.3d 1364, 1374 (Fed. Cir. 2003)). The Examiner thus does not
adopt Requester’s proposed rejection under 35 U.S.C. § 112, second
paragraph, on this basis. Ex. Deter. 9.
A claim limitation that does not explicitly use the term “means”
triggers a rebuttable presumption that 35 U.S.C. § 112, sixth paragraph, does
not apply. Phillips v. AWH Corp., 415 F.3d 1303, 1310 (Fed. Cir. 2005) (en
banc). Such a presumption can be overcome when a claim term does not
recite sufficiently definite structure or recites a function without reciting
sufficient structure for performing the function. Williamson v. Citrix Online,
LLC, 792 F.3d 1339, 1348 (Fed. Cir. 2015) (en banc). Such a term acts a
generic placeholder and would not be recognized by one of ordinary skill as
being sufficiently definite (1) structure for performing the claimed function
or (2) meaning as the name for the structure. See id. at 1349.
The recitation of “a rectifier configured to rectify an audio output
signal received from the associated audio output channel to provide power to
the integrated circuit device” does not use the term “means.” As such, the
limitation triggers the rebuttable presumption that 35 U.S.C. § 112, sixth
paragraph, does not apply. Although Requester urges that the presumption
has been rebutted because the recitation to the “rectifier” is only a generic
placeholder, we disagree.
Patent Owner provides definitions for the term “rectifier”
demonstrating what one skilled in the art would have understood the term
“rectifier” in claim 15 to mean. PO Reply 5. The definition includes a
structure that is a converter, device, or component that converts a signal
from alternative current (AC) to direct current (DC). See The Authoritative
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Dictionary of IEEE Standards Terms 939 (2000), cited in PO Reply Br. 5.
Additionally, Requester provides a list of components that Dr. Thompson, a
person who is at least an ordinarily skilled artisan, would have recognized as
rectifiers that rectify an audio output signal, including “diodes, integrated
circuits, mechanical vibrators, half wave rectifying circuits, and full wave
rectifying circuits.” 3PR Response 11 (citing 3d Thompson Decl. ¶ 15).
Thus, the term “rectifier” recites sufficiently definite structure. Moreover,
the functional recitation of “to rectify an audio output signal received from
the associated audio output channel to provide power to the integrated circuit
device” does not perform function beyond what a rectifier normally
performs (e.g., rectify a signal or convert a signal from AC to DC). Upon
review, the evidence of record supports that one skilled in the art would have
recognized a sufficiently definite meaning for the structure involved in
rectifying an audio output signal as recited.
To be sure, Dr. Thompson concludes that the claim language of “a
rectifier configured to rectify” “does not provide a person of ordinary skill in
the art the required structure to know what type of ‘rectifier’ is being
claimed” and “appears directed to the entire class of such device.” 3d
Thompson Decl. ¶ 15. But, this statement contrasts with the list of devices
and “class of components” he provides. Id. Furthermore, breadth should not
be confused with indefiniteness. See Biosig, 715 F.3d at 902.
For these reasons, we agree with the Examiner that the claim does not
invoke 35 U.S.C. § 112, sixth paragraph, and need not determine whether
the “rectifier” limitation is definite within the context of a means-plus-
function recitation. We further agree that the scope of the recited “rectifier”
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is clear and that the “rectifier” limitation is definite. Accordingly, we
sustain the Examiner’s conclusion that claim 15’s recitation to “a rectifier” is
definite.
2. Claims 16 and 18
Although not separately addressed by the Examiner, the Examiner
states “TRS-style” raises issues under 35 U.S.C. § 112, second paragraph.
Ex. Deter. 6 (discussing “TRS-style plug” is a “vague term”), 9 (citing 3PR
Response 13–15 (discussing the limitations of “a TRS-style plug” and “a
TRS-style socket” are indefinite)). Given that claim 16 recites “TRS-style
socket,” this claim is indefinite for similar reasons as those discussed for
claim 15. Also, due to their dependency on claim 15, claims 16 and 18 are
found to be indefinite. See 3PR Response 10 (indicating in the header that
claims 16 and 18 do not comply with 35 U.S.C. § 112, second paragraph).
On the other hand, the recited “rectifier” limitation in claim 16 is definite.
Accordingly, we sustain the rejection of claims 16 and 18 under 35
U.S.C. § 112, second paragraph.
3. Claim 20
Regarding the limitation of “the card reader device is configured to
rectify the data transfer clock,” Requester asserts this recitation invokes
35 U.S.C. § 112, sixth paragraph and should be considered indefinite for the
same reasons as presented for claim 15. 3PR Response 13 (referring to the
discussion of claim 15). Specifically, Requester argues that the recitation
“‘configured to rectify’ implies a structural configuration that is nowhere
described in the ’248 patent,” rendering the claim indefinite. Id. at 13
(underlining omitted). Although the Examiner does not comment on claim
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20 and whether it invokes § 112, second paragraph, we assume the Examiner
adopts the same reasoning as presented for claim 15 in concluding that the
limitation “the card reader device is configured to rectify the data transfer
clock” does not invoke § 112, sixth paragraph and is not indefinite under
§ 112, second paragraph. See Ex. Deter. 9.
This disputed language lacks the term “means” and also recites actual
structure in the form of “a card reader device” That is, claim 20 also
depends from claim 14, which recites structural details of the recited “card
reader device,” including a read head, a signal setting device, an integrated
circuit, and an output plug. The disclosure further details structural details
of the card reader, including an integrated circuit and output plug, as well as
how the card reader connects to other components of the claimed system,
such as the integrated circuit device adapted to be inserted into an input
associated with the host device. See the ’248 patent 6:58–66, 7:21–48, 8:14–
48, Figs. 6–8. Thus, like the “modernizing device” in Inventio AG v.
Thyssenkrupp Elevator Americas Corp., 649 F.3d 1350, 1357–58 (Fed. Cir.
2011), the card reader device recites its structural details and how the device
is connected to other components of the patented system.
Unlike claim 15, the recitation in claim 20 of “the card reader device
is configured to rectify the data transfer clock” does not explicitly recite “a
rectifier.” Yet, the recitation of “the card reader device is configured to
rectify the data transfer clock” is one way of expressing the presence of a
rectifying element (e.g., a rectifier) in the card reader device and connoting
structure. See Corning Glass Works v. Sumitomo Electric U.S.A., Inc. et al.,
868 F.2d 1251, 1257 (Fed. Cir. 1989). To this extent, we agree with
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Requester that the recitation “configured to rectify” implies a structural
limitation. 3PR Response 13. But, as discussed above when addressing
claim 15, we determine that one skilled in the art would have understood the
boundaries of the recited “rectifier.” As such, we similarly determine that
one skilled in the art would have understood the structure encompassed by
the recited “card reader device is configured to rectify” when read in light of
the discussion and refer to our previous discussion for details.
We thus disagree with Requester that “the card reader device” acts a
generic placeholder and further disagree that claim 20 invokes 35 U.S.C.
§ 112, sixth paragraph.
On the other hand, presuming that the recitation “the card reader
device is configured to rectify the data transfer clock” does invoke § 112,
sixth paragraph, the corresponding disclosure in the ’248 patent provides
adequate corresponding structure for this purported means-plus-function
limitation. First, as noted above, the ’248 patent’s disclosure identifies the
card reader device as a structural component (e.g., 150) and some of its
circuitry. The ’248 patent 6:58–66, 7:21–48, Figs. 6–8. As such, “the card
reader device” connotes sufficiently definite structure to those skilled in the
art. Second and as discussed above, the ’248 patent discusses rectifying an
output waveform and the data transfer clock. The ’248 patent 8:52–54,
8:67–9:1. Given this disclosure and as noted above when discussing claim
15, one skilled in the art would have understood the structure required to
perform this rectifying function. We refer above for details. Accordingly,
we sustain the Examiner conclusion that claim 20 is definite on this basis.
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For these reasons, we agree with the Examiner that claim 20 does not
invoke 35 U.S.C. § 112, sixth paragraph, and need not determine whether
the “card reader device is configured to rectify the data transfer clock” is
definite within the context of a means-plus-function recitation. Accordingly,
we sustain the Examiner’ conclusion that claim 20 is definite on this basis. 
E. Petitionable Matters
Patent Owner and Requester raise a petitionable matter. See, e.g., PO
Comments 21 (disputing any objection to the drawings related a rectifier),
PO Reply 4, 3PR Comments 3 and 8, and 3PR Reply 11. Specifically,
without formally presenting an objection to the drawings, the Examiner
states “[a]n objection to the drawings would be appropriate insofar as a
rectifier is now claimed but is not depicted in any of the Figures.” Ex.
Deter. 9. Presuming an objection is pending, the Board is not the
appropriate venue for the resolution of this issue. See MPEP §§ 1002 and
1201, 9th ed. (Oct. and Nov. 2015 respectively); see also In re Hengehold,
440 F.2d 1395, 1403 (CCPA 1971) (stating that there are many kinds of
decisions made by examiners, “which have not been and are not now
appealable to the board or to this court when they are not directly connected
with the merits of issues involving rejections of claims, but traditionally
have been settled by petition to the Commissioner.”)
F. Any Remaining Proposed Rejections
Our conclusion that the Examiner did not err in maintaining certain
rejections and not adopting other proposed rejections renders it unnecessary
to reach the propriety of any remaining proposed rejections. See Beloit
Corp. v. Valmet Oy, 742 F.2d 1421, 1423 (Fed. Cir. 1984); cf. In re Gleave,
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560 F.3d 1331, 1338 (Fed. Cir. 2009). See also 37 C.F.R. 41.77 (a) (“The
Patent Trial and Appeal Board … may affirm or reverse each decision of the
examiner on all issues raised on each appealed claim”) and Gleave, 560 F.3d
at 1338.

IV. CONCLUSIONS
The Examiner did not err in maintaining the rejection of claims 14 and
19 based on Wood, Antonio, and Odagiri.
The Examiner did not err in not adopting the proposed rejections of
claims 15, 16, 18, and 20 based on Wood, Antonio, Odagiri, and Sander or
Jones.
The Examiner did not err in rejecting claims 15, 16, and 18 under
35 U.S.C. § 112, first paragraph (written description), concerning the
limitations of “TRS-style plug” (claim 15), “TRS-style socket” (claims 15
and 16), and “the microphone input circuit is the only circuit configured for
providing a signal form the integrated circuit to the host device” (claim 15).
The Examiner erred in rejecting claims 15 and 16 under 35 U.S.C.
§ 112, first paragraph (written description), concerning the limitations of “a
rectifier” and “audio circuitry.”
The Examiner erred in not adopting the proposed rejection of claims
15, 16, and 20 under 35 U.S.C. § 112, first paragraph (written description),
concerning the limitations “at least one of the left channel circuit and the
right channel circuit comprises a rectifier configured to rectify an audio
output signal” (claim 15), “both the left channel circuit and the right channel
circuit comprise a rectifier configured to rectify an audio output signal”
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(claim 16), and “the card reader is configured to rectify the data transfer
clock” (claim 20).
The Examiner did not err in rejecting claims 15, 16, and 18 under
35 U.S.C. § 112, second paragraph, concerning the limitation of “a TRS-
style plug” and “a TRS-style socket.”
The Examiner did not err in not adopting the proposed rejection of
claims 15 and 20 under 35 U.S.C. § 112, second paragraph, concerning the
limitation of “a rectifier configured to rectify an audio output signal” (claim
15) and “the card reader is configured to rectify the data transfer clock”
(claim 20).
We present a new ground of rejection under 35 U.S.C. § 112, first
paragraph, concerning the limitations of “at least one of the left channel
circuit and the right channel circuit comprises a rectifier configured to
rectify an audio output signal” in claim 15 and similarly recited in claim 16
and “the card reader is configured to rectify the data transfer clock” in claim
20. Claim 18 is also newly rejected due to its dependency on claim 15.

V. TIME PERIOD FOR RESPONSE
Pursuant to 37 C.F.R. § 41.77(a), the above-noted reversal constitutes
a new ground of rejection. Section 41.77(b) provides that “[a] new ground
of rejection . . . shall not be considered final for judicial review.” That
section also provides that Patent Owner, WITHIN ONE MONTH FROM
THE DATE OF THE DECISION, must exercise one of the following two
options with respect to the new grounds of rejection to avoid termination of
the appeal proceeding as to the rejected claims:
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(1) Reopen prosecution. The owner may file a response
requesting reopening of prosecution before the examiner. Such
a response must be either an amendment of the claims so rejected
or new evidence relating to the claims so rejected, or both.

(2) Request rehearing. The owner may request that the
proceeding be reheard under § 41.79 by the Board upon the same
record. The request for rehearing must address any new ground
of rejection and state with particularity the points believed to
have been misapprehended or overlooked in entering the new
ground of rejection and also state all other grounds upon which
rehearing is sought.

In accordance with 37 C.F.R. § 41.79(a)(1), the “[p]arties to the
appeal may file a request for rehearing of the decision within one month of
the date of: . . . [t]he original decision of the Board under § 41.77(a).” A
request for rehearing must be in compliance with 37 C.F.R. § 41.79(b).
Comments in opposition to the request and additional requests for rehearing
must be in accordance with 37 C.F.R. § 41.79(c)–(d), respectively. Under
37 C.F.R. § 41.79(e), “[t]he times for requesting rehearing under paragraph
(a) of this section, for requesting further rehearing under paragraph (c) of
this section, and for submitting comments under paragraph (b) of this section
may not be extended.”
An appeal to the United States Court of Appeals for the Federal
Circuit under 35 U.S.C. §§ 141–144 and 315 and 37 C.F.R. § 1.983 for an
inter partes reexamination proceeding “commenced” on or after November
2, 2002 may not be taken “until all parties’ rights to request rehearing have
been exhausted, at which time the decision of the Board is final and
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appealable by any party to the appeal to the Board.” 37 C.F.R. § 41.81; see
also MPEP §§ 2682, 2683 (8th ed., Rev. 8, July 2010).
No time period for taking any subsequent action in connection with
this appeal may be extended under 37 C.F.R. § 1.136(a).
Requests for extensions of time in this inter partes reexamination
proceeding are governed by 37 C.F.R. § 1.956. See 37 C.F.R. § 41.79.
In the event neither party files a request for rehearing within the time
provided in 37 C.F.R. § 41.79, and this decision becomes final and
appealable under 37 C.F.R. § 41.81, a party seeking judicial review must
timely serve notice on the Director of the United States Patent and
Trademark Office. See 37 C.F.R. §§ 90.1 and 1.983.

AFFIRMED IN PART; 37 C.F.R. § 41.77(b)

msc

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FOR PATENT OWNER:

CALDWELL CASSADY CURRY P.C.
2101 Cedar Springs Road Suite 1000
Dallas, TX 75201

FOR THIRD-PARTY REQUESTERS:

Scott A. McKeown
OBLON, SPIVAK, MCCLELLAND, MAIER & NEUSTADT, LLP
1940 Duke Street
Alexandria, Virginia 22314