Reed Smith’s Lisa A. Chiarini, Eric Hutz, James C. Martin and Sid Kapoor represented MIAX in the matter.
“This decision, following closely on the heels of our victory for MIAX in a related Covered Business Method Review (“CBM Review”) against Nasdaq just six days prior, is another positive outcome that will help break the stranglehold Nasdaq has on electronic securities trading exchanges, with invalid patent claims,” said Chiarini. “We anticipate more open competition in this market as a consequence of both rulings.”
As with Nasdaq’s U.S. Patent No. 7,921,051, ruled patent ineligible on October 3, today’s PTAB decision arises as a result of Nasdaq’s assertion of patent infringement against MIAX in the United States District Court for the District of New Jersey in September 2017. Nasdaq alleges that MIAX violated Nasdaq’s patents and used its trade secrets to launch MIAX’s competing options exchanges. MIAX disputes all those claims.
Reed Smith successfully argued in a hearing before the PTAB in July that the ’506 Patent is not exempt from CBM Review because it fails to claim a novel and unobvious technological feature, and that all of its patent claims are invalid under the landmark 2014 U.S. Supreme Court decision Alice Corp v. CLS Bank. That case held that patent claims directed to an abstract idea without any inventive concept are ineligible for a patent under Section 101 of the U.S. Patent Code.
“Our argument that using generic computers to monitor an indicator signal, or ‘heartbeat,’ to determine a recipient’s availability is an abstract concept that does not meet the definition of a patent-eligible invention under both the Alice precedent and the USPTO’s 2019 Revised Guidance on patent eligibility. The PTAB agreed,” Hutz said.
Chiarini added, “with each successive decision in MIAX’s favor, we are sharpening the focus of what is and what is not patent-eligible in the FinTech industry as it relates to electronic securities trading.”
About Reed Smith
Reed Smith is a dynamic international law firm, dedicated to helping clients move their businesses forward. Its long-standing relationships, international outlook, and collaborative structure make it a go-to partner for speedy resolution of complex disputes, transactions, and regulatory matters.
About Reed Smith’s FinTech IP Practice
At Reed Smith, we recognize the complexity that the FinTech sector causes you and your business. Our market-leading experience within the financial industry, intellectual property litigation, corporate transactions, capital markets, investment management and funds, information technology, privacy and data security sectors means we are uniquely positioned to provide our skills, services and advice for the FinTech sector. By combining the litigation firepower and trial experience of a leading international law firm with our advanced knowledge of FinTech technology, we readily apply a pragmatic and commercial approach to preserve and protect your most valuable assets. We litigate IP disputes of all types, including those involving patents, copyrights, trademarks, designs, unfair competition and trade secrets.
For further information about Reed Smith’s FinTech IP Practice, please contact Lisa A. Chiarini.
