COHEN GANOR, Shlomo et al.

Patent Trials and Appeals Board

Apr 24, 2020

13605142 - (D) (P.T.A.B. Apr. 24, 2020)

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.
13/605,142 09/06/2012 Shlomo COHEN GANOR P-76074-US 8226
49443 7590 04/24/2020
Pearl Cohen Zedek Latzer Baratz LLP
1500 Broadway
12th Floor
New York, NY 10036
EXAMINER
POLLOCK, GREGORY A
ART UNIT PAPER NUMBER
3695
NOTIFICATION DATE DELIVERY MODE
04/24/2020 ELECTRONIC
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.
Notice of the Office communication was sent electronically on above-indicated "Notification Date" to the
following e-mail address(es):
Arch-USPTO@PearlCohen.com
USPTO@PearlCohen.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte SHLOMO COHEN GANOR and OR PELES

Appeal 2018-008411
Application 13/605,142
Technology Center 3600

Before PHILIP J. HOFFMANN, CYNTHIA L. MURPHY, and
TARA L. HUTCHINGS, Administrative Patent Judges.

HOFFMANN, Administrative Patent Judge.

DECISION ON APPEAL
STATEMENT OF THE CASE
Pursuant to 35 U.S.C. § 134(a), Appellant1 appeals from the
Examiner’s decision to reject claims 1–3, 5, 6, 10–15, and 21–27. We have
jurisdiction under 35 U.S.C. § 6(b). Appellant and the Board conducted an
oral hearing on April 6, 2020.
We AFFIRM.

1 We use the word “Appellant” to refer to “applicant” as defined in
37 C.F.R. § 1.42. Appellant identifies “NICE Ltd.” as the real party in
interest. Appeal Br. 1.
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According to Appellant, the “invention relates to the field of fraud risk
estimation.” Spec. ¶ 1. Below, we reproduce independent claim 1 as
illustrative of the appealed claims:
1. A computer-implemented method for estimating
fraud risk of on-line transactions in real-time, the method
comprising:
executing a crawler process by a processor, the processor
accessing a social media server via the Internet, the crawler
process executed with a plurality of targets, and receiving from
the crawler process social media information for the plurality of
targets;
assigning an entity identification to each target of the
plurality of targets, and storing the social media information
and the entity identification of each target of the plurality of
targets in a social media data repository, wherein the social
media information of each target includes at least a target
location of the target and social media relationship information;
receiving, by a fraud risk estimator executed by the
processor, from a transaction management system located in a
different location from the fraud risk estimator, an on-line
transaction for scoring;
extracting from the on-line transaction, by the fraud risk
estimator, transaction information including at least an entity
identification and a transaction location of a first party of the
on-line transaction;
selecting, by the fraud risk estimator, one target of the
plurality of targets based on the entity identification
corresponding to social media information stored in the social
media data repository;
identifying, by the fraud risk estimator, a first correlation
between the social media information of the one selected target
and the transaction information of the first party using a first
key indicator function, wherein the first key indicator function
is based on the proximity of the transaction location of the first
party and a target location of the one selected target;
identifying, by the fraud risk estimator, a second
correlation between the first party and a second party that is a
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party to the on-line transaction using a second key indicator
function, wherein the second key indicator function is based on
a relationship between the first party and second party on social
media;
calculating by the fraud risk estimator a risk score of the
on-line transaction, based on the first correlation and the second
correlation;
identifying, by the fraud risk estimator, one or more
fraudulent events based on the risk score; and
controlling, by the transaction management system, the
on-line transaction.
REJECTIONS
The Examiner rejects the claims as follows:
I. Claims 1–3, 5, 6, 10–15, and 21–27 under 35 U.S.C. § 101 as
reciting only patent-ineligible subject matter; and
II. Claims 1 and 11 under 35 U.S.C. § 112, first paragraph, as
failing to comply with the written description requirement.
PRINCIPLES OF LAW CONCERNING 35 U.S.C. § 101
An invention is patent eligible if it claims a “new and useful process,
machine, manufacture, or composition of matter.” 35 U.S.C. § 101. The
Supreme Court has long interpreted 35 U.S.C. § 101 to include implicit
exceptions, however: “[l]aws of nature, natural phenomena, and abstract
ideas” are not patentable. E.g., Alice Corp. v. CLS Bank Int’l, 573 U.S. 208,
216 (2014) (citation omitted).
In determining whether a claim falls within an excluded category, the
Supreme Court’s two-step framework, described in Mayo and Alice, guides
us. See id. at 217–18 (citing Mayo Collaborative Servs. v. Prometheus
Labs., Inc., 566 U.S. 66, 75–77 (2012)). In accordance with that framework,
we first determine what concept the claim is “directed to.” Id. at 219 (“On
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their face, the claims before us are drawn to the concept of intermediated
settlement, i.e., the use of a third party to mitigate settlement risk.”); see also
Bilski v. Kappos, 561 U.S. 593, 611 (2010) (“Claims 1 and 4 in petitioners’
application explain the basic concept of hedging, or protecting against
risk.”).
Concepts that the courts determined to be abstract ideas—and, thus,
patent ineligible—include certain methods of organizing human activity,
such as fundamental economic practices (Alice, 573 U.S. at 219–20; Bilski,
561 U.S. at 611); mathematical formulas (Parker v. Flook, 437 U.S. 584,
594–95 (1978)); and mental processes (Gottschalk v. Benson, 409 U.S. 63,
67 (1972)). Concepts that the courts determined to be patent eligible include
physical and chemical processes, such as “molding rubber products”
(Diamond v. Diehr, 450 U.S. 175, 191 (1981)); “tanning, dyeing, making
water-proof cloth, vulcanizing India rubber, smelting ores” (id. at 182 n.7
(quoting Corning v. Burden, 56 U.S. 252, 267–68 (1853))); and
manufacturing flour (Benson, 409 U.S. at 69 (citing Cochrane v. Deener, 94
U.S. 780, 785 (1876))).
In Diehr, although the claim at issue recited a mathematical formula,
the Supreme Court held that “a claim drawn to subject matter otherwise
statutory does not become nonstatutory simply because it uses a
mathematical formula.” Diehr, 450 U.S. at 187; see also id. at 191 (“We
view respondents’ claims as nothing more than a process for molding rubber
products and not as an attempt to patent a mathematical formula.”).
Nonetheless, the Supreme Court also indicated that a claim “seeking patent
protection for that formula in the abstract . . . is not accorded the protection
of our patent laws, and this principle cannot be circumvented by attempting
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to limit the use of the formula to a particular technological environment.”
Id. (citing Benson and Flook); see, e.g., id. at 187 (“It is now commonplace
that an application of a law of nature or mathematical formula to a known
structure or process may well be deserving of patent protection.”).
If the claim is “directed to” an abstract idea, we turn to the second
step of the Alice and Mayo framework, where “we must examine the
elements of the claim to determine whether it contains an ‘inventive
concept’ sufficient to ‘transform’ the claimed abstract idea into a
patent-eligible application.” Alice, 573 U.S. at 221 (citation omitted). “A
claim that recites an abstract idea must include ‘additional features’ to
ensure ‘that the [claim] is more than a drafting effort designed to
monopolize the [abstract idea].’” Id. (quoting Mayo, 566 U.S. at 77).
“[M]erely requir[ing] generic computer implementation[] fail[s] to transform
that abstract idea into a patent-eligible invention.” Id.
2019 Revised Patent Subject Matter Eligibility Guidance
In 2019, the U.S. Patent and Trademark Office published revised
guidance on the application of § 101. See 2019 Revised Patent Subject
Matter Eligibility Guidance, 84 Fed. Reg. 50 (Jan. 7, 2019) (“Guidance”).
Under that Guidance, we first look to whether the claim recites:
(1) any judicial exceptions, including certain groupings
of abstract ideas (i.e., mathematical concepts, certain methods
of organizing human activity such as i) a fundamental economic
practice, or ii) managing personal behavior or relationships or
interactions between people, or mental processes); and
(2) additional elements that integrate the judicial
exception into a practical application (see MANUAL OF PATENT
EXAMINING PROCEDURE (“MPEP”) § 2106.05(a)–(c), (e)–(h)
(9th Ed., Rev. 08.2017, Jan. 2018)).
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A practical application “appl[ies], rel[ies] on, or use[s] the judicial exception
in a manner that imposes a meaningful limit on the judicial exception, such
that the claim is more than a drafting effort designed to monopolize the
judicial exception.” Guidance at 54.
Only if a claim (1) recites a judicial exception and (2) does not
integrate that exception into a practical application, do we then look to
whether the claim either:
(3) adds a specific limitation beyond the judicial
exception which is not “well-understood, routine, [or]
conventional” in the field (see MPEP § 2106.05(d)); or
(4) simply appends well-understood, routine, and
conventional activities previously known to the industry,
specified at a high level of generality, to the judicial exception.
See generally Guidance.
ANALYSIS
Rejection I—Rejection under § 101
Initially, we note that Appellant argues against the Examiner’s § 101
rejection of the claims as a group. See, e.g., Appeal Br. 6–17. We choose
independent claim 1 for our analysis, and the remaining claims stand or fall
with claim 1. See 37 C.F.R. § 41.37 (c)(1)(iv). For the following reasons,
based on our review of the record, we sustain the Examiner’s rejection of the
claims as patent-ineligible.
We determine that in accordance with point (1) of the Guidance
referenced above, independent claim 1 recites at least one judicial exception,
including an abstract idea. More specifically, as described in further detail,
the abstract idea includes certain methods of organizing human activity, such
as a fundamental economic practice.
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With reference to claim 1, the claim recites a method for estimating
fraud risk, which comprises:
A. gathering social-media-related information for a plurality of targets
(i.e., “executing a crawler process by a processor, the processor
accessing a social media server via the Internet, the crawler
process executed with a plurality of targets, and receiving from the
crawler process social media information for the plurality of
targets” (Appeal Br., Claims App. (Claim 1)));
B. storing the social-media-related information, which includes i)
location and ii) social-media relationships, for each of the targets
(i.e., “assigning an entity identification to each target of the
plurality of targets, and storing the social media information and
the entity identification of each target of the plurality of targets in a
social media data repository, wherein the social media information
of each target includes at least a target location of the target and
social media relationship information” (id.));
C. receiving information about an online-transaction (i.e., “receiving,
by a fraud risk estimator executed by the processor, from a
transaction management system located in a different location from
the fraud risk estimator, an on-line transaction for scoring” (id.));
D. extracting, from the online-transaction information, location
information as to where the transaction occurred (i.e., “extracting
from the on-line transaction, by the fraud risk estimator,
transaction information including at least an entity identification
and a transaction location of a first party of the on-line transaction”
(id.));
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E. selecting, from the plurality of targets, the target that participated
in the online transaction (i.e., “selecting, by the fraud risk
estimator, one target of the plurality of targets based on the entity
identification corresponding to social media information stored in
the social media data repository” (id.));
F. identifying a first correlation based on a comparison of the
transaction location and the selected target’s location (i.e.,
“identifying, by the fraud risk estimator, a first correlation between
the social media information of the one selected target and the
transaction information of the first party using a first key indicator
function, wherein the first key indicator function is based on the
proximity of the transaction location of the first party and a target
location of the one selected target” (id.));
G. identifying a second correlation based on a comparison of the
selected target’s social-media relationships and the identity of the
merchant (i.e., “identifying, by the fraud risk estimator, a second
correlation between the first party and a second party that is a party
to the on-line transaction using a second key indicator function,
wherein the second key indicator function is based on a
relationship between the first party and second party on social
media” (id.));
H. calculating a risk score based on both correlations (i.e.,
“calculating by the fraud risk estimator a risk score of the on-line
transaction, based on the first correlation and the second
correlation” (id.));
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I. identifying a fraudulent event based on the risk score (i.e.,
“identifying, by the fraud risk estimator, one or more fraudulent
events based on the risk score” (id.)); and
J. accordingly controlling the transaction (i.e., “controlling, by the
transaction management system, the on-line transaction” (id.)).
Thus, as set forth above, claim 1 is directed to managing (i.e.,
estimating) financial risk. It is well settled that managing financial risk is a
fundamental economic practice, and, therefore, managing financial risk is an
abstract idea. See MPEP § 2106.04(a)(2)(I)(B); Alice, 573 U.S. at 219–20
(“intermediated settlement” is a fundamental economic practice, and, thus,
an abstract idea); Bilski, 561 U.S. at 611 (“hedging” is a fundamental
economic practice, which is an abstract idea).
In accordance with point (2) of the Guidance referenced above,
claim 1 does not recite any additional element that integrates the judicial
exception into a practical application—i.e., something that “appl[ies],
rel[ies] on, or use[s] the judicial exception in a manner that imposes a
meaningful limit on the judicial exception, such that the claim is more than a
drafting effort designed to monopolize the judicial exception.” Guidance
at 54. Aside from the abstract idea described above, the claim only
generically recites the use of certain arguably-physical hardware—i.e., “a
processor,” “a social media server,” “the Internet,” “a social media data
repository,” the processor’s “fraud risk estimator,” “a transaction
management system”—and, thus, this hardware does not meaningfully limit
the claim.
As for the claimed combination of the hardware, it also does not
integrate the abstract idea into a practical application. For example, claim 1
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recites that the processor “access[es]” the social media server, and that this
accessing occurs “via” the Internet. The claim further recites that the fraud
risk estimator is “executed by” the processor. As for the social media data
repository, claim 1 recites that the fraud risk estimator “select[s]” social
media information “stored” in the repository. Regarding the transaction
management system, claim 1 recites that the fraud risk estimator “receiv[es]”
transaction data from the system.
Restated, claim 1 does not claim any of these elements, or the ordered
combination thereof, in any specific or detailed way. To the extent that
these elements are described in Appellant’s Specification, the Specification
does not describe the elements in such a way, or combined in such a manner,
as to indicate that they are anything other than generic. See, e.g., Spec.
¶¶ 25, 36, 37, 39, Fig. 1. Thus, claim 1 does not integrate the abstract idea
into a practical application, and does not affect an improvement in any
technology or technical field.
Therefore, for the above reasons, independent claim 1 is directed to an
abstract idea, and does not integrate any judicial exception into a practical
application.
In accordance with points (3) and (4) of the Guidance referenced
above, claim 1 fails to recite a specific limitation beyond the judicial
exception which is not well understood, routine, and conventional in the
field, but instead simply appends well-understood, routine, and conventional
activities previously known to the industry, specified at a high level of
generality, to the judicial exception. Taking the claim elements separately,
the claimed hardware, as well as the functions performed by the claimed
hardware, are purely conventional. Specifically, claim 1 uses known,
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conventional components to perform their known, basic functions. See, e.g.,
Spec. ¶¶ 36, 37, 39. Although, arguably, the actual information differs, the
claim recites the hardware only at a high level of generality. In other words,
here the claim recites only well-understood, routine, and conventional
functions. See In re Katz, 639 F.3d 1303, 1316 (Fed. Cir. 2011) (“Absent a
possible narrower construction of the terms ‘processing,’ ‘receiving,’ and
‘storing,’ . . . those functions can be achieved by any general purpose
computer without special programming.”).
Further, when considered as an ordered combination, claim 1’s
limitations do not add anything that is not already present when we consider
the steps separately. See, e.g., Spec. ¶ 25, Fig. 1. The hardware and its
technological configuration remain the same before, during, and after
estimating the risk of an on-line transaction. Thus, the claim amounts to
nothing significantly more than instructions to apply the abstract idea with
conventional hardware, and does not require an improved version or
arrangement of the recited hardware. Accordingly, the claim recitations are
insufficient to transform the abstract idea into a patent-eligible invention.
See Alice, 573 U.S. at 225–26.
We have considered all of Appellant’s arguments in the Briefs, but
Appellant does not persuade us that the claims recite patent-eligible subject
matter. See Appeal Br. 6–17; see Reply Br. 3–7; see Suppl. Appeal Br. 2–4
(pages unnumbered). We now address certain arguments below.
Appellant’s arguments as to why the claims are not directed to the
abstract idea of mathematical concepts or mental processes are not
persuasive. See, e.g., Suppl. Appeal Br. 2–3. As discussed above, we
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determine that claim 1 is directed to the abstract idea of a fundamental
economic practice.
Appellant argues that “[t]he claims on appeal could not as a practical
matter be performed in the human mind.” Id. at 3; see also id. at 3–4. Even
assuming this is correct, this is immaterial when the abstract idea to which a
claim is directed is a fundamental economic practice, as is Appellant’s
claim 1.
Appellant’s arguments with reference to BASCOM Glob. Internet
Servs., Inc. v. AT&T Mobility LLC, 827 F.3d 1341 (Fed. Cir. 2016), are not
persuasive of error. See Appeal Br. 16–17. In BASCOM, the Federal Circuit
did indicate that it is sometimes possible for “an inventive concept” to reside
in “the non-conventional and non-generic arrangement of known,
conventional pieces,” such as “a set of generic computer components.”
BASCOM, 827 F.3d at 1350. However, as explained above, the computer
components recited in Appellant’s claim 1 are arranged in a conventional
and generic manner.
Appellant’s arguments with respect to Enfish, LLC v. Microsoft Corp.,
822 F.3d 1327 (Fed. Cir. 2016) also are unpersuasive. Appeal Br. 7–10.
Unlike Appellant’s claims, the claims in Enfish recited a “specific
improvement to the way computers operate”—i.e., an improved database
configuration that permitted faster and more efficient searching. Id.
at 1330–33, 1336. The Federal Circuit later explained that the claims in
Enfish “did more than allow computers to perform familiar tasks with
greater speed and efficiency” but “actually permitted users to launch and
construct databases in a new way.” Finjan, Inc. v. Blue Coat Sys., Inc., 879
F.3d 1299, 1305 (Fed. Cir. 2018). The Federal Circuit also explained that
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the claims in Enfish “focused on an improvement to computer functionality
itself, not on economic or other tasks for which a computer is used in its
ordinary capacity.” Secured Mail Sols. LLC v. Universal Wilde, Inc., 873
F.3d 905, 910 (Fed. Cir. 2017). In contrast, Appellant’s claims may improve
the economic tasks involved with estimating or computing financial risk, but
Appellant’s claims do not recite an improvement in the way the non-abstract
hardware performs such tasks.
We are not persuaded by Appellant’s arguments with respect to
McRO, Inc. dba Planet Blue v. Bandai Namco Games America Inc., 837
F.3d 1299 (Fed. Cir. 2016). Appeal Br. 7–8, 11–12, 14–16; Reply Br. 3–5.
In McRO the claims were directed to a specific asserted improvement in
computer animation—i.e., the automatic use of rules of a particular type. Id.
at 1313. The Federal Circuit clarified that the “automation” recited in the
claims at issue went beyond merely “carrying out a fundamental economic
practice.” Id. at 1315. Thus, unlike McRO, the automation recited in
Appellant’s claim 1 is for carrying out a fundamental economic process,
specifically estimating risk for an online transaction.
Rejection II—Rejection under § 112
As set forth above, the Examiner rejects independent claims 1 and 11
as failing to comply with the written-description requirement. Independent
claim 1 recites, in relevant part,
identifying, by the fraud risk estimator, a first correlation
between the social media information of the one selected target
and the transaction information of the first party using a first
key indicator function, wherein the first key indicator function
is based on the proximity of the transaction location of the first
party and a target location of the one selected target;
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identifying, by the fraud risk estimator, a second
correlation between the first party and a second party that is a
party to the on-line transaction using a second key indicator
function, wherein the second key indicator function is based on
a relationship between the first party and second party on social
media; [and]
calculating by the fraud risk estimator a risk score of the
on-line transaction, based on the first correlation and the second
correlation;
Appeal Br., Claims App. Independent claim 11 includes similar recitations.
See id. Although the Examiner does not disagree with Appellant that the
Specification provides support for each of the two identifying steps
separately (see id. at 4–5 (citing Spec. ¶¶ 77, 78, 110, 115, Figs. 4–8); see
Answer 3–4; see also Final Action 4), according to the Examiner the
Specification does not provide written-description support for the claimed
step of calculating a risk score based on both the identified first and second
correlations (see Answer 3–4).
Based on our review of the record, we do not sustain the rejection.
Specifically, we agree with Appellant that the Specification provides
written-description support for calculating a risk score based on both
correlations. Appeal Br. 4–6; Reply Br. 1–2. In particular, we agree with
Appellant that at least paragraph 77 of the Specification provides support for
calculating a risk score based on the first and second correlations, as
claimed.
CONCLUSION
We AFFIRM the Examiner’s rejection under § 101.
We REVERSE the Examiner’s rejection under § 112.
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In summary:
No time period for taking any subsequent action in connection with
this appeal may be extended under 37 C.F.R. § 1.136(a). See 37 C.F.R.
§ 41.50(f).
AFFIRMED

Claims
Rejected
35 U.S.C. § Reference(s)/Basis Affirmed Reversed
1–3, 5, 6, 10–
15, 21–27
101 Eligibility 1–3, 5, 6, 10–
15, 21–27

1, 11 112 Written description 1, 11
Overall
Outcome
1–3, 5, 6, 10–
15, 21–27