In Re Chuang , 603 F. App'x 941 ( 2015 )

NOTE: This disposition is nonprecedential.
United States Court of Appeals
for the Federal Circuit
______________________
IN RE THOMAS C. CHUANG,
Appellant
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2014-1257
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Appeal from the United States Patent and Trademark
Office, Patent Trial and Appeal Board in No. 12/488,562.
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Decided: February 10, 2015
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THOMAS C. CHUANG, Chuang Intellectual Property
Law, San Francisco, California, pro se.
NATHAN K. KELLEY, Office of the Solicitor, United
States Patent and Trademark Office, Alexandria, VA, for
appellee. Also represented by FARHEENA YASMEEN
RASHEED, AMY J. NELSON.
______________________
Before REYNA, MAYER, and CHEN, Circuit Judges.
PER CURIAM.
The Patent Trial and Appeal Board (Board) affirmed
the examiner’s rejections of claims 1–3 and 5–20 from
Thomas Chuang’s patent application as obvious over a
2 IN RE CHUANG
combination of three references. For the reasons dis-
cussed below, we affirm.
BACKGROUND
Mr. Chuang filed his application on June 21, 2009 un-
der the Patent Office’s Accelerated Examination pro-
gram. 1 Following a final action issued by the Patent
Office, Mr. Chuang appealed to the Board (then called the
Board of Patent Appeals and Interferences). In response,
the examiner reopened prosecution, but rejected all
pending claims under 35 U.S.C. § 103, and rejected cer-
tain claims as non-statutory subject matter under 35
U.S.C. § 101. Mr. Chuang again appealed to the Board,
which then issued a decision affirming the examiner’s
rejections under 35 U.S.C. § 103, and, without the benefit
of later-decided Alice Corp. v. CLS Bank Int’l, 134 S. Ct.
2347, 2358 (2014), the Board reversed the examiner’s
rejections under 35 U.S.C. § 101. This appeal followed.
We confine our review to the Section 103 issue. We have
jurisdiction under 28 U.S.C. § 1295(a)(4).
DISCUSSION
We review the Board’s factual findings for substantial
evidence and its legal conclusions de novo. In re Kotzab,
217 F.3d 1365, 1369 (Fed. Cir. 2000). Obviousness is a
question of law based on underlying facts. Graham v.
John Deere Co., 383 U.S. 1, 17 (1966).
1 As a condition of entry into the Accelerated Exam-
ination Program, Mr. Chuang agreed not to separately
argue the patentability of any dependent claims in any
subsequent appeal. See Manual of Patent Examining
Procedure (MPEP) § 708.02(a)(I), 9th ed., rev. 9 (Mar.
2014). Mr. Chuang’s appeal of the rejections is thus
focused on representative claims 1, 7, and 13, which are
the independent claims.
IN RE CHUANG 3
REJECTION OF CLAIM 1
Independent claim 1 recites a computer implemented
method for managing rented downloaded content:
A computer implemented method for managing
rented downloaded content comprising:
[a] presenting a user with a content descriptor as-
sociated with a downloadable content down-
loadable to the user available to rent at a rental
price and purchase at an initial purchase price;
[b] receiving a user rental request to rent the
downloadable content at the rental price;
[c] initiating downloading of the downloadable
content to the user at a user computer responsive
to receiving the user rental request, the down-
loadable content including a use limitation com-
prising an expiration date;
[d] generating a user data structure comprising:
[i] one or more content descriptors associ-
ated with previously downloaded content
rented by the user; and
[ii] a status identifier for each content de-
scriptor, the status identifier comprising
the expiration date;
[e] maintaining a database of user data structures
corresponding to a plurality of users;
[f] generating a previously downloaded content
purchase price for a content descriptor associated
with a previously downloaded content rented by
the user;
[g] providing the previously downloaded content
purchase price to the user;
4 IN RE CHUANG
[h] receiving a user purchase request to purchase
the previously downloaded content rented by the
user and residing on the user computer; and
[i] transmitting an update of the use limitation
following receipt of the user purchase request, the
update comprising a file update eliminating the
expiration date included in the downloadable con-
tent.
Application, claim 1 (annotated).
The examiner rejected claim 1 and dependent claims
2–3 and 5–6 as obvious over the combination of three
references: U.S. Patent publication no. 2004/0068451
(Lenk), U.S. Patent no. 7,403,910 (Hastings), and U.S.
Patent publication no. 2002/0032905 (Sherr). 2
Lenk discloses an online system and method for rent-
ing and purchasing electronic media, for example video
games, wherein the media is mailed to the customer in
physical discs. Lenk, abstract. Figure 31 illustrates an
exemplary webpage, which displays a game product
description page including selection buttons for “Rent it
(36R),” and “Buy it (36b).” Any user can click on the “Buy
it” button and purchase any game listed on the website
for a corresponding “Buy it” price. Id. at ¶¶ 81–82. In
addition, Lenk discloses a monthly subscription rental
model whereby a user is charged a monthly subscription
fee. Id. at ¶ 73. Subscribing members are permitted to
take out a predetermined number of discs at any given
time (e.g., no more than two games out at a time). Id. If a
member clicks on “Rent it” button when viewing a game,
2 While not necessary to reject the claims, the
examiner also cited a fourth reference (Ptasznik). Be-
cause the claims are properly rejected under the combina-
tion of Lenk, Hastings, and Sherr, we find it unnecessary
to address Ptasznik.
IN RE CHUANG 5
that game is added to the member’s rental queue and
subsequently delivered to that member. Id. at ¶¶ 80–81.
Under “Games You Have Out,” members have the option,
at any time while a game is in their possession, to click
the “Keep it” button and keep the game for a purchase
price set by the service. Id. at ¶ 106.
Hastings likewise discloses a system for renting digi-
tal audio and video products to customers using a sub-
scription payment model. Hastings, col. 9, ll. 1–25.
Similar to Lenk, Hastings teaches that customers can
select movies, music, and videogames and prioritize them
in a desired order within a rental queue. Id. at col. 8, ll.
8–19. Hastings further discloses that the rental user can
choose electronic delivery of the content by download over
the Internet, or by shipment of physical media in the
mail. Id. at col. 26, ll. 5–12. The download process is
mediated by “a software feature or tool to manage the
electronic transfer and relinquishment of the content
product” with encryption provisions for “removal, change,
or expiry of keys that unlock or enable the content to be
used.” Id. at col. 26, ll. 15–17, col. 25, ll. 50–60. In the
rental context, the tool may have the ability to delete
content when the rental period for that content has ex-
pired. Id. at col. 26, ll. 35–39.
The third reference Sherr also discloses a rental sys-
tem for video rental services. Sherr, ¶ 9. Unlike Lenk
and Hastings, Sherr discloses a pay-as-you-go model that
allows users to download movie files onto their computers
using the Internet. Id. Users send requests to rent
digital video from an online catalog and upon payment,
are able to download the video. Id. Once a video is
transmitted, it is viewable by a user for a specified period
of time using an encryption key. Id. at ¶¶ 88, 119, 122.
The encryption key is disabled once the specified period of
time expires and prohibits further replaying of the video.
Id. at ¶¶ 121–22.
6 IN RE CHUANG
All three references disclose online video or video
game rental services and, as the examiner found, describe
business strategies that were old and well known in the
art. In particular, the examiner noted that a skilled
artisan would have recognized that the concepts of rent-
ing media with the additional option of buying it, whether
by mail, downloaded over the Internet, per title, or by a
monthly subscription fee, were all old and well known.
Individual features from each reference could thus be
combined according to known methods to yield predictable
results. For example, the examiner found that one of
ordinary skill in the art would have “looked upon Has-
tings and recognized that downloading media to be played
on an electronic system is old and well known and would
have been an obvious feature to be included with the
system and method of Lenk,” which discloses delivery of
rented media by mail. Examiner’s Answer dated Apr. 6,
2011 (Answer), 12. Combining Lenk and Hastings would
predictably provide “a more versatile media” as well as
“providing a more streamlined process of allowing user’s
[sic] to purchase media that they already have in their
possession.” Id. at 12-13. The examiner likewise found it
would have been obvious to combine aspects of Sherr even
though Sherr discloses a different payment model, be-
cause that model was simply “an alternate business
strategy that is old and well known in the art.” Id. at 28.
Ultimately, the nature of the problem to be solved—
renting media to users—as well as the need to do so in an
efficient and user-friendly way, would have led one of
ordinary skill in the art to choose appropriate features
from each reference to arrive at the claimed invention.
In particular, the examiner found that Lenk teaches
most of the limitations of claim 1, including presenting
the content for rent or purchase, receiving a rental re-
quest for the content, delivering the content, providing
the user a purchase price for the previously rented con-
tent in the user’s possession, receiving a purchase request
IN RE CHUANG 7
for the content, and updating the database to reflect the
sale. The examiner also found that the claimed “rental
price,” under its broadest reasonable interpretation,
encompasses the monthly rental scheme disclosed in
Lenk. The examiner acknowledged that the combination
of Lenk and Hastings fails to disclose a use limitation and
a status identifier, the limitation and identifier each
comprising an expiration date. However, Sherr disclosed
those limitations by teaching media that is encrypted and
unlocked using an encryption key that expires once a
specified period of time passes.
The Board reviewed, agreed with, and affirmed the
examiner’s obviousness rejections. Accordingly, the Board
rejected Mr. Chuang’s argument that the claimed “rental
price” is not met by Lenk’s subscription plan model. The
Board agreed with the examiner that the term encom-
passes monthly rental schemes, finding that “each rental
media in the Lenk system has an associated price, which
is the monthly subscription fee.” The Board also rejected
Mr. Chuang’s argument that Lenk teaches away from the
use of an expiration date because there are no “due dates”
in the monthly subscription plan. The Board found that
while Lenk teaches an alternative design, Mr. Chuang
failed to show that Lenk criticizes, discredits, or otherwise
discourages the claimed solution.
Mr. Chuang advances here essentially the same ar-
guments he raised on appeal to the Board. First, he
contends that the Board erred in affirming the examiner’s
determination that Lenk discloses the claimed “rental
price” of clause [a]. Specifically, Mr. Chuang contends
that the Board failed to construe the term or in the alter-
native, incorrectly construed the term.
We find that the Board, in adopting the examiner’s
analysis, addressed the construction of the term ade-
quately enough to permit judicial review. See, e.g., In re
Hyatt, 211 F.3d 1367, 1371 (Fed. Cir. 2000). With respect
8 IN RE CHUANG
to “rental price,” the examiner found that the prior art
does “have an associated rental fee for renting media
online[.]” Answer at 27. This statement implicitly con-
strues the “rental price” limitation, under its broadest
reasonable interpretation, to mean “an associated rental
fee for renting media online.”
Here, Mr. Chuang has not provided a persuasive rea-
son, e.g., disclaimer or lexicography, for us to depart from
the examiner’s construction (adopted by the Board). We
also note that his proposed construction is inconsistent
with other parts of the specification, which discloses a
DVD rental embodiment where users pay a monthly fee
which allows the user to rent as many DVDs as desired.
Under the agency’s reasonable construction, there is no
dispute that Lenk’s monthly fee for renting media disclos-
es the “rental price” as claimed. 3
Next, Mr. Chuang contends that Lenk is not properly
combined with Sherr to teach the term “expiration date”
in limitations [c] and [d] of claim 1. Mr. Chuang does not
dispute that Sherr discloses this limitation. However, he
contends that Lenk’s disclosure of a monthly subscription
system teaches away from use of expiration dates as
claimed in his invention. Specifically, because Lenk
teaches that members can rent their games for any length
of time and emphasizes the absence of due dates as a
benefit of its subscription model, it teaches away using
expiration dates.
3 Moreover, it is undisputed that the prior art dis-
closes the claimed “rental price” even under Mr. Chuang’s
narrow conception of the term. As the examiner found,
Sherr discloses the old and well-known method of allow-
ing users to rent a particular movie for a predetermined
time period for a specified payment. Answer at 13; Sherr,
Fig. 9; id. at ¶ 9.
IN RE CHUANG 9
We disagree. There is substantial evidence to support
the Board’s finding that Lenk does not teach away from
the claimed invention. The fact that the two references
teach different payment models for how to rent videos
does not mean that a person of ordinary skill in the art
would have been discouraged from combining different
features from the two disclosures, including the well-
known aspect of using expiration dates on rental media.
“[I]t is not necessary that the inventions of the references
be physically combinable to render obvious the invention
under review.” In re Sneed, 710 F.2d 1544, 1550 (Fed.
Cir. 1983); see also In re Fulton, 391 F.3d 1195, 1201 (Fed.
Cir. 2004) (“The prior art’s mere disclosure of more than
one alternative does not constitute a teaching away from
any of these alternatives because such disclosure does not
criticize, discredit, or otherwise discourage the [claimed]
solution . . . .”). Rather, the relevant inquiry is “what the
combined teachings of the references would have suggest-
ed to those of ordinary skill in the art.” In re Keller, 642
F.2d 413, 425 (C.C.P.A. 1981).
In adopting the examiner’s rejections, the Board rea-
sonably found that both references are directed to the
same field of endeavor—distribution and rental of media.
It was further reasonable for the Board to find that using
an expiration date with the downloaded rented media of
Lenk (as modified in view of Hastings) was no more than
a combination of familiar elements in a known way to
yield predictable results. As the references teach old and
well-known concepts for renting media, taking a well-
established feature of one and incorporating it into the
other would have been obvious. See, e.g., Lenk, ¶ 69
(generally stating that its invention may be “applied to
rental and sales of electronic entertainment items.”)] Mr.
Chuang is unable to point to any passage in Lenk that
criticizes or otherwise discourages the use of expiration
dates in a rental system using a subscription payment
model. Indeed, the examiner found that Hastings, which
10 IN RE CHUANG
like Lenk teaches a subscription model, teaches deleting
downloaded media after the rental time has expired.
We thus find that the Board did not err in upholding
the examiner’s rejection of claim 1.
REJECTION OF CLAIM 7
Mr. Chuang relies on the same arguments presented
for claim 1 in appealing the rejection of claim 7. We reject
these arguments for the same reasons as set forth for
claim 1 and find that the Board did not err in upholding
the rejection of claim 7.
REJECTION OF CLAIM 13
Claim 13 is similar to claim 1 and, relevant here, re-
quires a step of providing to the user a user data struc-
ture comprising, inter alia, “a rent again selector for each
content descriptor . . . , the rent again selector associated
with a previously downloaded content rent again price
. . . .” Mr. Chuang contends that the Board erred in
finding that a “rent again selector” and a “rent again
price” would have been obvious over the prior art. He
does not dispute that the examiner properly found these
limitations are disclosed in Sherr. Rather, he again
argues that the teachings of Lenk and Sherr are incom-
patible because their respective media rental schemes are
incongruous.
We disagree and find the Board provided substantial
evidence of motivation for one of ordinary skill to combine
the teachings in the references to enable re-renting of
media. Through adopting the examiner’s Answer, the
Board reasonably found that one of ordinary skill in the
art looking at Lenk’s “Keep it” button would have under-
stood there was a motivation to provide shortcuts to allow
users to obtain items as quickly as possible. The same
motivation would have led one of ordinary skill in the art
to combine the attributes of Lenk with Sherr’s teaching of
re-renting media, with a “rent again” button “to provide
IN RE CHUANG 11
shortcuts to [allow users to] obtain an item as quickly as
possible . . . since it allows for better customer satisfac-
tion/service.” Answer at 32–33. See In re Keller, 642 F.2d
at 425. And as the examiner reasonably found, doing so
would have been a combination of familiar elements in a
known way to yield predictable results.
Mr. Chuang also contends that the prior art does not
disclose claim 13’s requirement of the step of receiving a
user request to re-rent previously rented content that is
“residing on the user computer.” Contrary to Mr.
Chuang’s arguments, as the Board and examiner found,
Sherr teaches that users can pay for unlock codes to “re-
rent the downloaded media.” See Answer at 29 (citing
Sherr, ¶¶ 88, 119, 122). Finally, Mr. Chuang relies on the
same arguments he presented for claim 1 as additional
grounds for appealing the rejection of claim 13. We reject
these arguments for the same reasons as set forth for
claim 1, supra.
We thus find the Board did not err in upholding the
examiner’s rejection of claim 13.
CONCLUSION
For the foregoing reasons, we conclude that the Board
properly affirmed the examiner’s rejection of representa-
tive claims 1, 7, and 13 as obvious over Lenk, Hastings,
and Sherr. We have considered Mr. Chuang’s remaining
arguments and find them without merit. We thus affirm
the rejections of claims 1–3 and 5–20.
AFFIRMED