Ex Parte Hammad

Patent Trials and Appeals Board

Mar 29, 2019

13038268 - (D) (P.T.A.B. Mar. 29, 2019)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE FIRST NAMED INVENTOR
13/038,268 03/01/2011 Ayman Hammad
66945 7590 04/02/2019
KILPATRICK TOWNSEND & STOCKTONLLP/VISA
Mailstop: IP Docketing - 22
1100 Peachtree Street
Suite 2800
Atlanta, GA 30309
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
ATTORNEY DOCKET NO. CONFIRMATION NO.
79900-791225 8488
EXAMINER
LIU, CHIA-YI
ART UNIT PAPER NUMBER
3695
NOTIFICATION DATE DELIVERY MODE
04/02/2019 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):
ipefiling@kilpatricktownsend.com
KTSDocketing2@kilpatrick.foundationip.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte A YMAN HAMMAD
Appeal2017-010399
Application 13/03 8,268
Technology Center 3600
Before ST. JOHN COURTENAY III, CATHERINE SHIANG, and
JOYCE CRAIG, Administrative Patent Judges.
CRAIG, Administrative Patent Judge.
DECISION ON APPEAL
Appellant1 appeals under 35 U.S.C. § 134(a) from the Examiner's
Final Rejection of claims 1, 3---6, 8-11, 13-16, and 21-32, which are all of
the claims pending in this application. 2 We have jurisdiction under
35 U.S.C. § 6(b).
We reverse.
1 According to Appellant, the real party in interest is Visa International
Service Association. App. Br. 2.
2 Claims 2, 7, 12, and 17-20 have been canceled. Final Act. 2.
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Application 13/03 8,268
INVENTION
Appellant's invention relates to including customized linkage rules in
payment transactions. Abstract. Claim 1 is illustrative and reads as follows:
1. A system comprising:
a computer readable storage medium; and
a processor coupled to the computer readable storage
medium, wherein the processor is configured to execute program
code stored on the computer readable storage medium to
implement a method comprising:
linking, using a linkage rule, ( 1) a verification token
device, (2) a user communication device, and (3) a payment
account of a portable consumer device;
receiving an authentication request message for a payment
transaction on the payment account, the authentication request
message received from the user communication device, the
authentication request message comprising (1) a verification
token identifier that identifies the verification token device used
to conduct a payment transaction, (2) a user communication
device identifier that identifies the user communication device
used to conduct the payment transaction, and (3) an account
identifier that identifies the payment account for conducting the
payment transaction, wherein the verification token device
receives the account identifier from the portable consumer
device;
identifying the linkage rule based on the account identifier
included in the authentication request message;
authenticating the payment transaction using the identified
linkage rule by verifying that the verification token identifier that
identifies the verification token device used to conduct the
payment transaction and the user communication device
identifier that identifies the user communication device used to
conduct the payment transaction included in the authentication
request message respectively identify the verification token
device and the user communication device specified in the
linkage rule;
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in response to the authenticating of the payment
transaction using the identified linkage rule, generating a
dynamic verification value based at least in part on the account
identifier;
providing the dynamic verification value to either ( 1) the
verification token device used to conduct the payment
transaction or (2) the user communication device used to conduct
the payment transaction, wherein either the verification token
device or the user communication device provides the dynamic
verification value to a merchant server to conduct the payment
transaction on the payment account; and
receiving an authorization request message from the
merchant server, the authorization request message comprising
the dynamic verification value; and
sending an authorization response message indicating
whether the payment transaction is approved or declined based
on verification of the dynamic verification value.
REJECTION
Claims 1, 3-6, 8-11, 13-16, and 21-32 stand rejected under 35 U.S.C.
§ 101 as they are directed to an abstract idea without significantly more.
Final Act. 2--4.
ANALYSIS
An invention is patent-eligible if it claims a "new and useful process,
machine, manufacture, or composition of matter." 35 U.S.C. § 101.
However, the Supreme Court has long interpreted 35 U.S.C. § 101 to include
implicit exceptions: "[l]aws of nature, natural phenomena, and abstract
ideas" are not patentable. Mayo Collaborative Servs. v. Prometheus Labs.,
Inc., 566 U.S. 66, 70 (2012) (brackets in original) (citing Diamond v. Diehr,
450 U.S. 175, 185 (1981)). In determining whether a claim falls within an
excluded category, we are guided by the Supreme Court's two-step
framework, described in Mayo and Alice. Alice Corp. v. CLS Bank Int 'l, 573
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U.S. 208, 217-18 (2014) (citing Mayo, 566 U.S. at 75-77). In accordance
with that framework, we first determine what concept the claim is "directed
to." See Alice, 573 U.S. at 218-19 ("On 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. Kappas, 561 U.S. 593, 611
(2010) ("Claims 1 and 4 in petitioners' application explain the basic concept
of hedging, or protecting against risk.").
Concepts 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 (Gottschalkv. Benson, 409 U.S. 63, 69 (1972)). Concepts
determined to be patent eligible include physical and chemical processes,
such as "molding ... rubber products" (Diamond v. Diehr, 450 U.S. 175,
192 (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 (1854))); and manufacturing flour (Benson, 409 U.S. at 69
(citing Cochrane v. Deener, 94 U.S. 780, 785 (1876))).
In Diehr, the claim at issue recited a mathematical formula, but 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 192 ("We
view respondents' claims as nothing more than a process for molding rubber
products and not as an attempt to patent a mathematical formula."). Having
said that, the Supreme Court also indicated that a claim "seeking patent
protection for that formula in the abstract ... is not accorded the protection
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of our patent laws, ... and this principle cannot be circumvented by
attempting 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 tum 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 (internal quotation marks
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.
The PTO recently published revised guidance on the application of
§ 101. USPTO's January 7, 2019 Memorandum, 84 Fed. Reg. 50, 2019
Revised Patent Subject Matter Eligibility Guidance ("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 a fundamental economic practice, or mental
processes); and
(2) additional elements that integrate the judicial exception into a
practical application ("Prong Two") (see MPEP § 2106.05(a}-(c), (e}-
(h)) (9th ed. 2018).
Only if a claim (1) recites a judicial exception and (2) does not integrate that
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exception into a practical application, do we then look to whether the claim:
(3) adds a specific limitation beyond the judicial exception that are
not "well-understood, routine, conventional" in the field (see MPEP
§ 2106.0S(d)); or
(4) simply appends well-understood, routine, conventional activities
previously known to the industry, specified at a high level of
generality, to the judicial exception.
See 2019 Guidance.
Step 2A - Prong 1: Judicial Exception
Step 2A of the 2019 Guidance is a two-prong inquiry. In Prong One
we evaluate whether the claim recites a judicial exception.
As set forth in the 2019 Guidance, which extracts and synthesizes key
concepts identified by the courts, abstract ideas include ( 1) mathematical
concepts, (2) certain methods of organizing human activity, and (3) mental
processes. Among those certain methods of organizing human activity listed
in the 2019 Guidance are fundamental economic practices, such as the
concept of mitigating risk in Alice, and the concept of hedging in Bilski.
Here, claim 1 recites operations that would ordinarily take place when
authorizing financial transactions:
linking, using a linkage rule, (1) a verification token
device, (2) a user communication device, and (3) a payment
account of a portable consumer device;
receiving an authentication request message for a
payment transaction on the payment account, ... the
authentication request message comprising ( 1) a verification
token identifier that identifies the verification token device used
to conduct a payment transaction, (2) a user communication
device identifier that identifies the user communication device
used to conduct the payment transaction, and (3) an account
identifier that identifies the payment account for conducting the
payment transaction, wherein the verification token device
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receives the account identifier from the portable consumer
device;
identifying the linkage rule based on the account
identifier included in the authentication request message;
authenticating the payment transaction using the
identified linkage rule by verifying that the verification token
identifier that identifies the verification token device used to
conduct the payment transaction and the user communication
device identifier that identifies the user communication device
used to conduct the payment transaction included in the
authentication request message respectively identify the
verification token device and the user communication device
specified in the linkage rule;
in response to the authenticating of the payment
transaction using the identified linkage rule, generating a
dynamic verification value based at least in part on the account
identifier;
receiving an authorization request message ... , the
authorization request message comprising the dynamic
verification value; and
sending an authorization response message indicating
whether the payment transaction is approved or declined based
on verification of the dynamic verification value.
These limitations, under their broadest reasonable interpretation,
recite authorizing a financial transaction because the limitations all recite
operations that would ordinarily take place in authorizing a financial
transaction. For example, when authorizing a financial transaction, it is
desirable to verify that the transaction originates from an authorized source.
See Spec. ,r 29. To provide security for the electronic payment transaction
being authorized, "receiving an authentication request message for a
payment transaction on the payment account" that includes data such as that
recited in the claim:
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Application 13/03 8,268
(1) a verification token identifier that identifies the verification
token device used to conduct a payment transaction, (2) a user
communication device identifier that identifies the user
communication device used to conduct the payment transaction,
and (3) an account identifier that identifies the payment
account for conducting the payment transaction, wherein the
verification token device receives the account identifier from
the portable consumer device
would take place whenever one is authorizing a payment transaction.
Similarly, the limitation "identifying the linkage rule based on the account
identifier included in the authentication request message" and the
"authenticating," "generating," and "receiving" limitations would take place
whenever one is authorizing a payment transaction. When authorizing a
financial transaction, sending an authorization response message would take
place, indicating whether the payment transaction is approved or declined
("sending an authorization response message indicating whether the
payment transaction is approved or declined based on verification of the
dynamic verification value").
Authorizing financial transactions in the manner recited by the claim
is a fundamental economic practice, which is one of certain methods of
organizing human activity, and thus an abstract idea under the 2019
Guidance.
Step 2A - Prong 2 - Practical Application
If a claim recites a judicial exception, in Prong Two we determine
whether the recited judicial exception is integrated into a practical
application of that exception by: (a) identifying whether there are any
additional elements recited in the claim beyond the judicial exception(s); and
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(b) evaluating those additional elements individually and in combination to
determine whether they integrate the exception into a practical application.
If the recited judicial exception is integrated into a practical application, the
claim is not directed to the judicial exception.
Here, claim 1 recites the additional elements of:
"a computer readable storage medium"
"a processor coupled to the computer readable storage medium,
wherein the processor is configured to execute program code stored
on the computer readable storage medium to implement a method''
"the authentication request message received from the user
communication device"
''providing the dynamic verification value to either (1) the verification
token device used to conduct the payment transaction or (2) the user
communication device used to conduct the payment transaction,
wherein either the verification token device or the user
communication device provides the dynamic verification value to a
merchant server to conduct the payment transaction on the payment
account"
"merchant server"
Considering the claim as a whole, the ''providing" step applies or uses
the abstract idea in a meaningful way such that the claim as a whole is more
than a drafting effort designed to monopolize the exception. See MPEP
§ 2106.0S(e). The ''providing" is "to either (1) the verification token device
used to conduct the payment transaction or (2) the user communication
device used to conduct the payment transaction, wherein either the
verification token device or the user communication device provides the
dynamic verification value to a merchant server to conduct the payment
transaction on the payment account." Here, the device to which the
dynamic verification value is provided further provides it to a merchant
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server to conduct the payment transaction on the payment account. Thus,
the limitation imposes meaningful limits on the claim such that it is more
than nominally or tangentially related to the invention. The limitation
amounts to more than insignificant extra-solution activity or generally
linking the use of the abstract idea to a particular technological environment.
Thus, the abstract idea in claim 1 is integrated into a practical application.
Claims 11 recites a similar "providing" step, which applies or uses the
abstract idea in a meaningful way.
Because claims 1 and 11 integrate the recited judicial exception into a
practical application, they are not "directed to" a judicial exception and,
therefore, our inquiry ends.
For these reasons, under the 2019 Guidance, we reverse the
Examiner's § 101 rejection of independent claims 1 and 11. We also reverse
the Examiner's§ 101 rejection of dependent claims 3-6, 8-10, 13-16, and
21-32, which stand or fall with the independent claims from which they
depend.
DECISION
We reverse the Examiner's decision rejecting claims 1, 3---6, 8-11,
13-16, and 21-32.
REVERSED
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