[00:00:00] Speaker 05:
Good morning, your honors, and may it please the court, Kathleen Sullivan for Universal Secure Registry.

[00:00:06] Speaker 05:
The patent claims that issue in the district court appeal are all directed to a new architecture for securely processing electronic payments over a computerized network.

[00:00:17] Speaker 05:
And all four recite specific techniques to solve a specific security problem in computerized networks.

[00:00:23] Speaker 05:
The district court heard

[00:00:25] Speaker 05:
in dismissing the complaint based on patent, supposed patent ineligibility under section 101.

[00:00:31] Speaker 05:
Ms.

[00:00:32] Speaker 03:
Hellerman, this is Judge Toronto.

[00:00:34] Speaker 03:
Does claim 539, claim 22 of 539 even require a computer?

[00:00:42] Speaker 05:
It does, Your Honor, because if you look to the specification, you see that the problem that's being solved is the problem of network communications.

[00:00:53] Speaker 05:
So 539 requires the... And if I could highlight the most important problem that's being solved, the problem that's being solved... Can you start first with the claim?

[00:01:02] Speaker 03:
I'm not sure what language in claim 22 requires that any of this be done on an electronic network.

[00:01:14] Speaker 05:
Your Honor, the claim read in light of the specifications makes clear that it is solving a problem that arises in

[00:01:21] Speaker 05:
Wi-Fi or computerized network transmission.

[00:01:25] Speaker 05:
And the secure data stored in a secure registry, the registry communicates over computers.

[00:01:34] Speaker 05:
Ms.

[00:01:35] Speaker 06:
Stoll, I understand Judge Toronto's question to be asking you to look at the claim language.

[00:01:40] Speaker 06:
And is there a particular claim language in Claim 22 that to you suggests that it has to be on a computer?

[00:01:51] Speaker 05:
Yes, Your Honor, the time-varying multi-character code implies an encrypted communication over computerized networks.

[00:02:02] Speaker 05:
And that time-varying multi-character code is common to all of the claims that issue in the appeal.

[00:02:07] Speaker 05:
And the compliance with access restrictions, the accessing information of the

[00:02:19] Speaker 05:
the use of biometric identification.

[00:02:23] Speaker 05:
The claim language in 539 speaks about the binary multiple.

[00:02:29] Speaker 03:
Just to be clear, there's nothing about biometrics in the 539, is there?

[00:02:34] Speaker 03:
It's just a time-varying multi-character code that somebody gets and does a few things with.

[00:02:43] Speaker 05:
Correct, Your Honor.

[00:02:44] Speaker 05:
The four claims

[00:02:47] Speaker 05:
represent the bookends of the novel invention here.

[00:02:51] Speaker 05:
What the contribution to computer security is here is that under the old technologies, to have security in electronic transactions, you had to try to firewall the interaction between the user and the merchant.

[00:03:08] Speaker 05:
This system at the front end and the back end creates a two-location or two-step authentication system

[00:03:14] Speaker 05:
And some of these claims are more directed to the back end.

[00:03:18] Speaker 05:
The 539 is directed to the second authentication step that uses the time-varying multi-character code to verify what is transmitted at the first authentication step.

[00:03:28] Speaker 05:
So the 137 claim 12 is a kind of... I mean, Selma, can I just ask this?

[00:03:32] Speaker 03:
Is it your view that these four claims stand or fall together?

[00:03:36] Speaker 05:
No, Your Honor.

[00:03:38] Speaker 05:
If I were to...

[00:03:41] Speaker 05:
Here, some have all the steps, some are missing one step.

[00:03:45] Speaker 05:
As Your Honor pointed out, the 539 claim 22 doesn't refer to the biometric and secret information that are used at the first authentication step in the ID device.

[00:03:56] Speaker 05:
And the 826 doesn't mention the time-varying code.

[00:04:01] Speaker 05:
But we think they do all, including the 539 and the 826, satisfy the ALICE test for step one, because each of them describes an improvement

[00:04:11] Speaker 05:
in the technology for dealing computer security.

[00:04:14] Speaker 05:
And if I could just computerize security, in other words, Judge Stoll, the problem wouldn't arise here if we weren't in a computerized network, because there would be none of the dangers that 539 is solving and 826 is solving.

[00:04:27] Speaker 05:
The danger that if you, if the user gives information, personally identifying information to the merchant and it's stored in the merchant's computer,

[00:04:37] Speaker 05:
or transmitted over an insecure line that could be hacked or result in interception or theft.

[00:04:43] Speaker 05:
But that technology was unable to provide the security that the new technology does provide.

[00:04:51] Speaker 05:
So, Your Honor, 559 claim 22 looks to the second step.

[00:04:56] Speaker 05:
Claim 12 of the 137 patent looks principally to the front end, the first device that provides the first authentication.

[00:05:03] Speaker 05:
using the user's secret or biometric information and the time-varying value?

[00:05:09] Speaker 05:
Ms.

[00:05:09] Speaker 06:
Sullivan, this is Judge Stoll.

[00:05:13] Speaker 06:
There's a lot of argument from Apple to the effect of that each of these individual steps in these claims is known.

[00:05:20] Speaker 06:
For example, having a time-varying multi-character code to provide authenticity of a person, having biometric input to authenticate a person,

[00:05:33] Speaker 06:
Um, all of these different techniques are known.

[00:05:36] Speaker 06:
Um, what about these claims with their combination of the different techniques and having the first device and the second device?

[00:05:46] Speaker 06:
What about, is there something about the combination that makes the claims directed to something that's a technological improvement?

[00:05:54] Speaker 05:
Yes, your honor, the combination.

[00:05:56] Speaker 05:
And as a minimum, it was there to dismiss under Alice step two for this reason.

[00:06:01] Speaker 05:
The combination of the steps in the claim provides a new alteration in the data flow.

[00:06:07] Speaker 05:
Old data flow was user gives personally identifying information to merchant, merchant authenticates with financial institution, financial institution transmits approval back to merchant.

[00:06:20] Speaker 05:
This fundamentally alters the data flow and all four of the claims do this.

[00:06:25] Speaker 05:
by saying that the user will provide biometric information and or secret information like a fingerprint or a pin that will generate a non-predictable value or a one-time variable code, multi-character code that's in all four claims except for a 26.

[00:06:43] Speaker 05:
And the USR, the Universal Secure Registry, can verify or authenticate at the second authentication step

[00:06:49] Speaker 05:
bypassing the merchant.

[00:06:51] Speaker 05:
And Judge Stahl, that's the essence of the contribution here.

[00:06:53] Speaker 05:
This is a technological means for cutting the merchant out of the flow of data over computerized networks because the user is authenticated through the USR's second authentication of the first authentication provided through the initial device.

[00:07:10] Speaker 05:
Your Honor, that's the contribution.

[00:07:12] Speaker 05:
It's an alteration in the data flow.

[00:07:15] Speaker 05:
And even if this is used by conventional

[00:07:17] Speaker 05:
done by conventional components such as processors and sensors, or as Judge Tramanto suggested earlier, through conventional techniques like the use of biometrics, that is not a ground for finding the patents ineligible, the claims ineligible, because the flow and the combination of them together create something new.

[00:07:39] Speaker 05:
And that's the thing that the district court erred at step one,

[00:07:44] Speaker 05:
by analyzing the claims at too high a level of generality, which as discussed earlier, violated the court's decision.

[00:07:53] Speaker 06:
I want to ask you, I hear what you're saying about the new alteration in data flow, but what is that new alteration in data flow in itself is abstract, like the idea of cutting the merchant out or, you know, some of these concepts at a high level, you know, really are just an idea.

[00:08:13] Speaker 06:
So what makes this new alteration data flow a technological improvement?

[00:08:20] Speaker 05:
Your Honor, what makes it a new technological improvement is the way in which the merchant is cut out.

[00:08:28] Speaker 05:
Biometric and or secret information is input by the user at the user end, generating a first authentication, generating a multi-character time variable code, which is then authenticated at the second step.

[00:08:42] Speaker 05:
through reading, or that time variable code, and comparing it to biometric and or secret information.

[00:08:50] Speaker 05:
So it's the use of the combined biometric and secret data with the multivariate code through the two separate authentication steps.

[00:09:01] Speaker 05:
That's the technological improvement.

[00:09:03] Speaker 05:
And, Your Honor, at the pleading stage, the court, of course, the district court should have accepted as true

[00:09:10] Speaker 05:
the allegations in the complaint, for example, at appendix page 273, and the specification stating that this technological improvement eliminates the need for magnetic card stripe readers at the merchant's point of sale, eliminates the physical need for users to carry multiple separate cards that could be read by those card readers, and reduces the need to have secured networks, because once this technological improvement is employed,

[00:09:38] Speaker 05:
You can send the information that is a combination of biometric and secret information that generates the multi-character code to the USR, and the USR can authenticate all without the merchant ever finding out or storing the identifying information.

[00:09:57] Speaker 05:
So it eliminates physical, tangible steps in the old technology.

[00:10:03] Speaker 05:
And the specifications in all four patents

[00:10:06] Speaker 05:
make very clear that changing that technological problem, the problem of insecure, vulnerability to hacking and theft, when you use magnetic stripe readers or other ways to try to do the security at the merchant's point of sale, that's the technological change.

[00:10:23] Speaker 05:
And it involves a change in the data flow, which this court has said is enough to show eligibility.

[00:10:30] Speaker 05:
Your Honor, I've focused on the legal error at step

[00:10:34] Speaker 05:
One, but I believe my time is expired unless you have any further questions about step two.

[00:10:41] Speaker 05:
The legal error at step one was too high a level of generality, missed the alteration of data flow in the specific steps in violation of tech tech and CORA and other cases at the court.

[00:10:52] Speaker 05:
And the legal error at step two, at Alice step two, was to look to conventional components and techniques and say that renders it abstract off the top.

[00:11:02] Speaker 05:
That's obviously

[00:11:04] Speaker 05:
We think a legal error under cases like Enfish at step one and cases like Bastrom and Amdocs at step two.

[00:11:12] Speaker 05:
Your Honor, I believe that I haven't heard a beep, but I believe I should reserve the balance of my time.

[00:11:18] Speaker 05:
Thank you.

[00:11:19] Speaker 01:
Okay.

[00:11:19] Speaker 01:
I haven't heard that beep either, but go ahead.

[00:11:22] Speaker 01:
You can reserve whatever you've got left.

[00:11:25] Speaker 02:
Just for clarification, this is Deputy Lichtenberg.

[00:11:28] Speaker 02:
Ms.

[00:11:28] Speaker 02:
Sullivan has just over three and a half minutes remaining.

[00:11:31] Speaker 02:
And for Mr. Selwyn's argument, I intend to play the tone when he has finished up 12 minutes, unless he cedes that time to Mr. Johnson before the 12 minutes are up.

[00:11:43] Speaker 01:
Thank you.

[00:11:44] Speaker 01:
That's very helpful.

[00:11:48] Speaker 01:
Mr. Selwyn.

[00:11:50] Speaker 04:
Thank you, Your Honor.

[00:11:51] Speaker 04:
Your honor, to the extent that the representative claims use a computer at all, the computer is merely being used as a tool.

[00:11:59] Speaker 04:
This is not an improvement in the functioning of the computer itself or in any software or hardware.

[00:12:06] Speaker 04:
The representative claims claim an abstract concept, secure verification of identity implemented through wholly generic computer components operating in conventional ways.

[00:12:19] Speaker 04:
This court has seen this kind of patent claim repeatedly before in Prism against T-Mobile, Ascari against USAA, and most recently in Boom against Stripe and founded patent and eligible each time.

[00:12:31] Speaker 04:
And that's important because this court has emphasized that assessments of patent eligibility are best done by reference to prior cases.

[00:12:39] Speaker 04:
Furthermore, as in Boom, Ascari, and Prism, the patent specification here confirms that the claims are not directed to an improvement

[00:12:48] Speaker 04:
and computer functionality or a new computing device.

[00:12:52] Speaker 04:
For example, with respect to the so-called universal secure registry, the specifications emphasize that a, quote, may be any kind of database and is not limited to a particular manner, quote, of organizing the data.

[00:13:06] Speaker 06:
Ms.

[00:13:06] Speaker 06:
Bellwin, this is Judge Stowell.

[00:13:08] Speaker 06:
How do you respond to the argument that this, with the inventions, the claimed inventions directed to in each of these claims,

[00:13:17] Speaker 06:
is a new alteration in the data flow so that the user provides their biometric or secret code and then it's used to generate the multivariable code and then the universal secure registry will verify.

[00:13:33] Speaker 06:
And that process, because a lot of these claims are method claims, cuts out the merchant and solves a technological problem.

[00:13:43] Speaker 06:
What is your response to that argument?

[00:13:47] Speaker 04:
Well, the first response is that's an argument that was forfeited by USR because it wasn't made in a complaint.

[00:13:53] Speaker 06:
Let's assume it wasn't for a minute, okay?

[00:13:55] Speaker 06:
Let's assume it wasn't because I want to hear what your answer is to the merits of that.

[00:14:02] Speaker 04:
Sure.

[00:14:02] Speaker 04:
The specific features that USR has identified as improvements in computer functionality simply don't make sense as such.

[00:14:11] Speaker 04:
USR has pointed to various things on appeal.

[00:14:15] Speaker 04:
Again, none of which it pointed to in its complaint or in its brief.

[00:14:19] Speaker 04:
Number one, the time-varying code.

[00:14:21] Speaker 04:
The patents acknowledge that to be prior art and available in off-the-shelf security... Let me try again, Mr. Sullivan.

[00:14:28] Speaker 06:
I hear what you're saying.

[00:14:30] Speaker 06:
I'm going to... Let's... You're right.

[00:14:31] Speaker 06:
There's a lot of individual components in these claims that are admitted to be in the prior art.

[00:14:37] Speaker 06:
Biometrics were invented here by this patent inventor, right?

[00:14:42] Speaker 06:
The Universal Code was not invented by them.

[00:14:45] Speaker 06:
I agree with you.

[00:14:45] Speaker 06:
The question is whether the claims directed to a combination, you know, creating a new method using these things like biometrics that was known, whether the combination makes the claim directed to a technological improvement.

[00:15:04] Speaker 06:
So I want you to think about, you know, whether the combination

[00:15:08] Speaker 06:
is, you know, how does that satisfy Section 101 as opposed to picking apart each element of the claim?

[00:15:17] Speaker 04:
Sure.

[00:15:17] Speaker 04:
This case is not like Bascom.

[00:15:20] Speaker 04:
Unlike in Bascom, the patent specifications here contain no suggestion that the components or steps of the system are arranged in a non-conventional or non-generic way.

[00:15:32] Speaker 04:
Instead, the specifications emphasized the generic nature of all of the computer components

[00:15:38] Speaker 04:
and that they're operating in conventional ways.

[00:15:42] Speaker 03:
Can you focus on, very specifically, new data flow?

[00:15:50] Speaker 04:
Yes.

[00:15:52] Speaker 04:
So the new data flow, which is what Ms.

[00:15:54] Speaker 04:
Sullivan just emphasized, that's insignificant post-solution activity, very similar to what the Supreme Court found in Alice, where the court held that a similar claim

[00:16:05] Speaker 04:
involving the use of a third party in a financial transaction to mitigate risk inherent in face-to-face business was an abstract idea.

[00:16:14] Speaker 03:
And in what sense does it make to use the word post?

[00:16:24] Speaker 03:
Post solution?

[00:16:25] Speaker 04:
Really?

[00:16:27] Speaker 04:
Well, yes, because as the Supreme Court wrote in that case, quote, the use of a third party intermediary or clearinghouse

[00:16:35] Speaker 04:
is a building block of the modern economy.

[00:16:38] Speaker 04:
And that may make it abstract, but that doesn't make it post solution activity.

[00:16:44] Speaker 04:
Well, it is post solution activity in the sense that the abstract idea is the secure authentication before a financial transaction.

[00:16:54] Speaker 04:
And this step is just involving a third party as an intermediary.

[00:16:58] Speaker 04:
And recently in the in rate able case, the court found a very similar claim

[00:17:02] Speaker 04:
that was directed to sending a customer's personal identification to a trusted intermediary to prevent another from having access to that information to be ineligible under Section 101.

[00:17:14] Speaker 04:
It's the same thing.

[00:17:15] Speaker 04:
And as for the suggestion about the combination, the patent specification doesn't support that.

[00:17:21] Speaker 04:
In fact, the very first sentence under the detailed description of each patent

[00:17:26] Speaker 04:
states the opposite.

[00:17:27] Speaker 04:
It says the invention is not limited in the application to the details of construction and the arrangement of components set forth in the following description or illustrated in the drawings.

[00:17:39] Speaker 04:
So the suggestion now that there is something about the ordered combination is contradicted by the specification itself.

[00:17:47] Speaker 04:
And it's also contradicted by the way

[00:17:50] Speaker 04:
the specification describes how the components of the system interact or operate.

[00:17:55] Speaker 04:
To give another example, the user interface may be, quote, any input and output device, and, quote, is not limited to any particular manner of interfacing an operator with the USR system.

[00:18:08] Speaker 04:
Access to the USR system may be, quote, by any secure access device.

[00:18:13] Speaker 04:
And the specification goes on to say such a system may be implemented in software, hardware, or firmware.

[00:18:19] Speaker 04:
communications between the interface sensors and the computer system may take place according to any protocol.

[00:18:26] Speaker 04:
So between the complaint and the patents, there's nothing that creates any actual basis for USR to claim inventive concept in an ordered combination.

[00:18:37] Speaker 04:
Therefore, this case is like the boom against strike case, where considering a very similar claim as the present one, this court concluded that, quote, the order and timing of the claim elements

[00:18:48] Speaker 04:
are merely the necessary steps of implementing the abstract idea.

[00:18:59] Speaker 04:
So again, every feature that USR has identified as an improvement is one that the patent emphasizes is generic.

[00:19:09] Speaker 04:
And the suggestion that was made that the complaint somehow supports there being some

[00:19:16] Speaker 04:
improvement or novelty, that's just not there in the complaint.

[00:19:21] Speaker 04:
The complaint makes no allegations that even if assumed to be true would make the representative patent claims eligible.

[00:19:28] Speaker 04:
The complaint says almost nothing specific about the asserted patents, much less allegations that would suggest that they improve computer functionality.

[00:19:37] Speaker 04:
The paragraphs that mention the asserted patents, paragraphs 25 through 28,

[00:19:42] Speaker 04:
merely recite the date of issuance, the title, and the owner and inventor of each patent.

[00:19:48] Speaker 04:
And then paragraphs 22 and 23 very vaguely refer to USR's technology without mentioning any specific or patent or claim, much less a supposed improvement in computer technology.

[00:20:01] Speaker 03:
This is Judge Tarento.

[00:20:01] Speaker 03:
Can I just, I think I'm going to ask you the same question I asked Ms.

[00:20:04] Speaker 03:
Sullivan.

[00:20:04] Speaker 03:
Is it your view that these four claims stand or fall together?

[00:20:09] Speaker 04:
I wouldn't say it quite that way.

[00:20:12] Speaker 04:
I would say that the same reasoning applies to all four claims.

[00:20:17] Speaker 04:
That is, there are differences among the claims, but they're all directed towards the same basic idea, and then they mix and match certain claim elements, all of which the specification emphasizes are generic.

[00:20:33] Speaker 03:
What case, if any, of ours,

[00:20:38] Speaker 03:
Part of what I hear is something like, sometimes a combination is more than the sum of its parts, but not here.

[00:20:51] Speaker 03:
What case are, because obviously you can put together, as the Supreme Court said, and I don't know, Mayo or Alice or somewhere, most inventions involve

[00:21:05] Speaker 03:
familiar components.

[00:21:06] Speaker 03:
So the putting together is very, very frequently what is inventive.

[00:21:11] Speaker 03:
And your point here, I gather, is here the putting together is not inventive.

[00:21:16] Speaker 03:
It's basically the equivalent of if one idea is good, two forms of idea can be better.

[00:21:23] Speaker 03:
And the idea of I want two forms of idea is itself abstract.

[00:21:28] Speaker 03:
What, if any, of our cases might lend support to that distinction?

[00:21:36] Speaker 04:
Well, the whole line of this court's cases that discuss merely invoking computers as a tool, that is what these claims have done.

[00:21:47] Speaker 04:
To the extent that they involve computer components, they're merely using those as a tool to implement the abstract idea.

[00:21:54] Speaker 04:
There's no claim here to have invented new hardware or software or any other specific improvements in the technology underlying

[00:22:02] Speaker 04:
the claims and the specification could not be clear that the plans claim no new software hardware processor programming language memory interface user interface database and so forth.

[00:22:15] Speaker 04:
And there's nothing suggested about the combination of those components that would make it an inventive concept either.

[00:22:23] Speaker 04:
Again, to the contrary, the specification emphasizes that there is nothing special about the combination or the order

[00:22:31] Speaker 04:
of those components.

[00:22:33] Speaker 04:
And when you look at the message steps themselves, they're done in entirely the natural order that one would expect.

[00:22:39] Speaker 06:
Mr. Selwyn, why isn't this a case like DDR where the computer itself creates the problem?

[00:22:47] Speaker 06:
That is specifically because, you know, the information of the user can be so easily repeated and sent around that when you're talking about inserting a credit card or what have you in a computer,

[00:23:00] Speaker 06:
There's a loss of confidential financial information when you're making transactions involving computers.

[00:23:09] Speaker 04:
Because the claims in DDR were necessarily rooted in computer technology.

[00:23:15] Speaker 04:
They addressed the problem of retaining website visitors in the context of the internet.

[00:23:21] Speaker 04:
And those claims were found not to recite a fundamental economic or longstanding commercial practice.

[00:23:27] Speaker 04:
In contrast, the claims here are directed towards a fundamental economic and long-standing commercial practice, and they're also ones that can be done entirely in the human mind.

[00:23:39] Speaker 04:
As this court wrote in Erickson against TCL,

[00:23:42] Speaker 04:
Controlling access to resources is exactly the sort of process that can be performed in the human mind or by a human using pen and paper, which we have repeatedly found unpatentable.

[00:23:54] Speaker 04:
Every single one of the claims here can be done in pen and pencil or in the human mind.

[00:23:59] Speaker 04:
And there's nothing about the combination of elements that takes them out of the realm of abstraction or renders them an inventive concept.

[00:24:11] Speaker 01:
You're into Mr. Johnson's time, you know.

[00:24:13] Speaker 04:
Yes, I will yield the balance of 15 minutes to Mr. Johnson.

[00:24:19] Speaker 00:
Thank you, Your Honor, and may it please the Court.

[00:24:21] Speaker 00:
I'd like to make two simple points.

[00:24:23] Speaker 00:
One about USR's claims that the claim combination improved computer security, and one about boom payments, and in particular as it relates to the level of generality and the flow of data.

[00:24:34] Speaker 00:
As to computer security, USR's argument rests on a false premise, really a sleight of hand.

[00:24:40] Speaker 00:
The generic components themselves are the same as before, but not only that, how they communicate and function is the same as before.

[00:24:47] Speaker 00:
Their physical arrangement is the same as before.

[00:24:50] Speaker 00:
The time-varying code functions just as before.

[00:24:53] Speaker 00:
The steps happen in exactly the same order, and you can see this clearly from figures seven and eight on pages 225 and 226 of the appendix.

[00:25:01] Speaker 00:
The only thing that's different is the information sent between the components and who receives

[00:25:07] Speaker 00:
a third party.

[00:25:08] Speaker 00:
And the only thing supposedly more secure is the information not sent.

[00:25:12] Speaker 00:
The seller never sees the credit card information that it used to see.

[00:25:17] Speaker 00:
That is not a specific technical improvement to computer security.

[00:25:21] Speaker 00:
It's, as Ms.

[00:25:21] Speaker 00:
Sullivan put it, altered data flow.

[00:25:23] Speaker 00:
It's just rerouting information and storing it differently.

[00:25:26] Speaker 00:
It's using computers as a tool to carry out a business practice that's old as banking, essentially in an escrow format just like Alice.

[00:25:34] Speaker 00:
Which brings me to my second point about Boom payments.

[00:25:38] Speaker 00:
On point after point, Boom rejects every argument that Ms.

[00:25:42] Speaker 00:
Sullivan makes here.

[00:25:44] Speaker 00:
Take level of generality.

[00:25:46] Speaker 00:
The patent there recited a 10 step payment system using third party and transaction specific buyer identification codes.

[00:25:53] Speaker 00:
This is how the court defined the abstract idea.

[00:25:56] Speaker 00:
Two words, payment escrow.

[00:25:58] Speaker 00:
It said this is just passing information back and forth with the third party.

[00:26:02] Speaker 00:
And it goes on to say, and this is a quote,

[00:26:04] Speaker 00:
Use of an identification code does nothing more than overlay a second layer of extraction, specifically identity authentication on the escrow procedure.

[00:26:13] Speaker 00:
The claims are reminiscent of Alice.

[00:26:16] Speaker 00:
Now the district court here actually used a lower level of generality than this court did in that case.

[00:26:22] Speaker 00:
It said obtaining the secure verification of a user's identity to enable transaction.

[00:26:27] Speaker 00:
But any suggestion that that was too low is foreclosed by boom.

[00:26:31] Speaker 00:
And Asgari, which took an even lower level, also found similar claims specifically involving a time-sensitive code invalid under Alice and this court affirmed under Rule 36.

[00:26:43] Speaker 00:
Now that brings me to the aspect of inventive concept and the flow of information.

[00:26:48] Speaker 00:
Boom payments also spoke directly to that.

[00:26:51] Speaker 00:
Boom argued that use of the buyer identifier was an inventive concept and this is why it said that.

[00:26:56] Speaker 00:
because it increases online payment security without making the payment flow burdensome and removes the need for any static buyer payment information, such as credit card numbers.

[00:27:09] Speaker 00:
Exact same things claimed here, and this court said that is not inventive.

[00:27:14] Speaker 00:
It's not rooted in a technological problem or solution.

[00:27:18] Speaker 00:
We urge the court to affirm this case falls squarely under boom, escari, and prism text.

[00:27:25] Speaker 01:
Thank you, counsel.

[00:27:26] Speaker 01:
Ms.

[00:27:27] Speaker 01:
Sullivan, you've got a little bit over three minutes.

[00:27:30] Speaker 05:
Thank you, Your Honor.

[00:27:31] Speaker 05:
Three quick points, Your Honor.

[00:27:33] Speaker 05:
First, as Judge Stoll suggested in the question earlier, this is a problem that begins with computerized networks.

[00:27:41] Speaker 05:
This is not automating a process that was used in the analog world.

[00:27:45] Speaker 05:
It's a problem that begins because existing technologies create insecurity problems when you look to security at the merchant through magnetic card stripe readers and so forth.

[00:27:55] Speaker 05:
So this is not a case like Alice that is about automating an analog process.

[00:28:02] Speaker 05:
And far from being the second, the combination, I didn't hear anything in Mr. Sullivan's argument to suggest that the combination of elements, even if they are conventional, is not new and unconventional.

[00:28:15] Speaker 05:
The alteration of the data flow means that the merchant is not privy to, as a matter of technology,

[00:28:22] Speaker 05:
to the identifying information because the combination of... Ms.

[00:28:27] Speaker 03:
Solomon, this is Jess Toretto.

[00:28:29] Speaker 03:
In what sense is there an alteration of data flow here that wasn't true in ALICE with using an intermediary, which I would think almost by definition means you're moving data to some new middle person?

[00:28:48] Speaker 05:
Your Honor, what's new is there's a first authentication step that the user is able to generate, biometric data, secret data, time-varying code, and there's a second authentication step at the USR level.

[00:29:05] Speaker 05:
And there's never any transmission, as there was in the prior technologies, of secret information to the merchant where it might be insecurely stored or intercepted.

[00:29:18] Speaker 05:
That's the alteration, Your Honor.

[00:29:19] Speaker 05:
And there's nothing in any of the claims or the specifications that suggests that that sequence of user connecting directly to the USR was in the prior technologies.

[00:29:31] Speaker 05:
It's not just using the USR as an intermediary to verify.

[00:29:35] Speaker 05:
It's having direct communication across a computer network.

[00:29:39] Speaker 05:
Your Honor, while I'm on the USR, I just want to answer your question, Judge Toronto, about what in the 539 patent refers to computers.

[00:29:47] Speaker 05:
I'd refer, Your Honor, to the preambular paragraph of Claim 22, which refers to secure data stored in a secure registry.

[00:29:54] Speaker 05:
Of course, we're at the dismissal stage, and that hasn't been subject to claim construction.

[00:29:58] Speaker 05:
But the specification makes clear that the secure registry is something that involves computers.

[00:30:04] Speaker 05:
And if I could just refer, Your Honor, to a few places in the specs for the 539, I'd refer, Your Honor, particularly to appendix

[00:30:15] Speaker 05:
235 to 236, which is where in Column 5, Line 30 through Column 7, Line 10, it discusses the Universal Secure Registry with reference to Figure 1 and describes it as a computer system.

[00:30:29] Speaker 05:
Similarly, Your Honor, if I could commend the Court's attention to the 539 Patent Column 8, starting at Line 22, which refers, as I suggested before, to the one-time nonpredictable code as something that is transmitted to the computer system.

[00:30:43] Speaker 05:
So Your Honor, this is an alteration in the technology of the data flow, not the concept of using an intermediary.

[00:30:50] Speaker 05:
And the last point, Your Honor, would simply be that this is at the motion to dismiss stage.

[00:30:55] Speaker 05:
There hasn't been claim construction that might illuminate the terms in the claim.

[00:31:00] Speaker 05:
The specification couldn't be clearer that the old data flow involved a different kind of technology and that there are concrete, practical, tangible changes in the technology of security here that eliminate the need for multiple cards

[00:31:13] Speaker 05:
and for dangerous things like magnetic card readers.

[00:31:16] Speaker 05:
Thank you very much.

[00:31:17] Speaker 05:
We think you should reverse and find these claims patent eligible under one on one at either Alex step one or step two.

[00:31:23] Speaker 05:
Thank you, your honor.

[00:31:24] Speaker 01:
Thank you, Ms.

[00:31:25] Speaker 01:
All for wrapping up.