Ex Parte KAPUR et al

Patent Trials and Appeals Board

Jun 28, 2019

13556669 - (D) (P.T.A.B. Jun. 28, 2019)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE
13/556,669 07/24/2012
118311 7590
Toering Patents PLLC
P.O. Box 1419
Leesburg, VA 20177
07/02/2019
FIRST NAMED INVENTOR
Shashi KAPUR
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.
A258 1060.1 6109
EXAMINER
KWONG, CHO YIU
ART UNIT PAPER NUMBER
3693
NOTIFICATION DATE DELIVERY MODE
07/02/2019 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):
rick@toeringpatents.com
admin@toeringpatents.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte SHASHI KAPUR and RALPH A. BIANCO
Appeal2017-008884
Application 13/556,669
Technology Center 3600
Before MURRIEL E. CRAWFORD, MICHAEL W. KIM, and
ROBERT J. SILVERMAN, Administrative Patent Judges.
CRAWFORD, Administrative Patent Judge.
DECISION ON APPEAL
STATEMENT OF THE CASE
Appellants seek our review under 35 U.S.C. § 134 of the Examiner's
final rejection of claims 1-8 and 10-17. We have jurisdiction under 35
U.S.C. § 6(b).
SUMMARY OF DECISION
We AFFIRM.
THE INVENTION
Appellants claim a system and method for real-time loan processing
and loan fund deposits. (Spec. ,-J 2, Title).
Claim 1 is representative of the subject matter on appeal.
Appeal2017-008884
Application 13/556,669
1. A method of processing a lending transaction,
compnsmg:
receiving, by an adaptive payment server, a request for a
loan fund amount and
first identification information from a lender, wherein the
first identification information belongs to a borrower;
in response to the request, determining, by the adaptive
payment server, an account of the borrower associated with the
first identification information;
determining, by the adaptive payment server, a
communication device of the borrower based on the first
identification information;
requesting, by the adaptive payment server, second
identification information from the borrower via the
communication device of the borrower;
receiving, by the adaptive payment server, the second
identification information from the borrower via the
communication device of the borrower;
authenticating, by the adaptive payment server, the
account of the borrower based on the second identification
information received from the borrower; and
initiating an electronic funds transfer of the requested
loan fund amount from an account of the lender to the account
of the borrower.
THE REJECTION
Claims 1-8 and 10-17 are rejected under 35 U.S.C. § 101 as directed
to a judicial exception without significantly more.
Claims 1-4, 6-8, 10-13, and 15-17 are rejected under 35 U.S.C.
§ 103(a) as being unpatentable over Kapur et al. (US 2010/0057623 Al, pub.
Mar. 4, 2010) in view of Davis et al. (US 2007/0271178 Al, pub. Nov. 22,
2007).
Claims 5 and 14 are rejected under pre-AIA 35 U.S.C. 103(a) as being
unpatentable over Kapur et al., Davis et al., as applied to claims 1-4, 6-8,
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Application 13/556,669
10-13 and 15-17, further in view of Mon (US 2002/0055904 Al, pub. May
9, 2002).
ANALYSIS
35 U.S.C. § 101 REJECTION
We will sustain the rejection of claims 1-8 and 10-1 7 under 3 5
U.S.C. § 101.
The Supreme Court
set forth a framework for distinguishing patents
that claim laws of nature, natural phenomena, and
abstract ideas from those that claim patent-eligible
applications of those concepts. First, . . .
determine whether the claims at issue are directed
to one of those patent-ineligible concepts. . . . If
so, ... then ask, "[ w ]hat else is there in the claims
before us?" . . . To answer that question, . . .
consider the elements of each claim both
individually and "as an ordered combination" to
determine whether the additional elements
"transform the nature of the claim" into a patent-
eligible application. . . . [The Court] described
step two of this analysis as a search for an
"'inventive concept'"-i.e., an element or
combination of elements that is "sufficient to
ensure that the patent in practice amounts to
significantly more than a patent upon the
[ineligible concept] itself."
Alice Corp. Pty. Ltd. v. CLS Banklnt'l, 573 U.S. 208,218 (2014) (citing
Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66, 72-73
(2012)) ( citations omitted).
To perform this test, we must first determine whether the claims at
issue are directed to a patent-ineligible concept. The Federal Circuit has
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explained that "the 'directed to' inquiry applies a stage-one filter to claims,
considered in light of the [S]pecification, based on whether 'their character
as a whole is directed to excluded subject matter."' See Enfzsh, LLC v.
Microsoft Corp., 822 F.3d 1327, 1335 (Fed. Cir. 2016) (quoting Internet
Patents Corp., 790 F.3d 1343, 1346 (Fed. Cir. 2015)). It asks whether the
focus of the claims is on a specific improvement in relevant technology or
on a process that itself qualifies as an "abstract idea" for which computers
are invoked merely as a tool. See id. at 1335-36.
In so doing we apply a "directed to" two prong test: 1) evaluate
whether the claim recites a judicial exception, and 2) if the claim recites a
judicial exception, evaluate whether the judicial exception is integrated into
a practical application. 2019 Revised Patent Subject Matter Eligibility
Guidance, 84 Fed. Reg. 50, 50-57 (Jan. 7, 2019) ("Guidance").
The Examiner determines that the claims are directed to processing
lending transactions, which is a fundamental economic practice or a method
of organizing human activity. (Final Act. 2).
The Specification discloses that in the traditional model, a customer
requests a payday loan by visiting a payday lending store and writing a
postdated check to the lender for the amount of the loan plus any additional
fees. (Spec. ,i 3). On the maturity date, the customer either returns to the
store to pay the loan or the lending store redeems the check. It may take
several days for the requested loan fees to be transferred to the borrower's
account because the borrower's account needs to be properly identified and
authenticated to ensure that the funds are securely transferred. (Spec. ,i 4 ).
The instant invention allows the funds to be deposited into a customer's
account substantially immediately. (Spec. ,i 6).
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Application 13/556,669
Claim 1 recites a method of processing lending transactions
comprising the steps of "retrieving . . . a request for a loan ... and first
identification information," "determining ... an account of the borrower,"
"requesting ... second identification ... from the borrower," "receiving .. .
second identification information from the borrower," "authenticating .. .
the account based on the second identification information," and "initiating
an electronic funds transfer."
Based at least on the above, we agree with the Examiner's findings
that the claims are directed to processing lending transactions. Specifically,
each of the above identified claim limitations are basic steps one would
perform in processing lending transactions. Processing lending transactions
is a commercial interaction and thus a fundamental economic practice which
is a judicial exception. Guidance 52.
Also, we find that certain of the above-identified steps of claim 1 also
constitute "analyzing information by steps people go through in their minds,
or by mathematical algorithms, without more, as essentially mental
processes within the abstract-idea category." Elec. Power Grp., LLC v.
Alstom S.A., 830 F.3d 1350, 1354 (Fed. Cir. 2016); see also buySAFE, Inc.
v. Google, Inc., 765 F.3d 1350, 1355 (Fed. Cir. 2014) (claims directed to
certain arrangements involving contractual relations are directed to abstract
ideas). For example, "retrieving ... a request for a loan ... and first
identification information" is no more than making an observation. In
another example, "authenticating ... the account based on the second
identification information" is no more than rendering an opinion that the
borrower is permitted to access the indicated account.
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Accordingly, we find that claim 1 recites both a fundamental
economic practice and mental processes.
Turning to the second prong of the "directed to test", we consider
whether the judicial exception recited in claim 1 is integrated into a practical
application. Guidance 55. In making this determination, we first consider
whether the recitations of claim 1 affect an improvement in the functioning
of the payment server or communication device or other technology,
whether claim 1 recites a particular machine, and whether claim 1 recites a
transformation or reduction of a particular article to a different state or thing.
Claim 1 does not recite an improvement to the payment server or the
communication device. Appellants' Specification discloses that the payment
server includes a processor, a memory and/or other components that
facilitate the functions of the adaptive payment server. (Spec. ,i 56). The
Specification discloses that the communication device may be generic
versions of a personal computer, portable computer, personal digital
assistant workstation, web-enabled mobile telephone, web-to-voice device,
or other device. (Spec. ,i 23). There is no disclosure of an improvement to
the payment server or communication device. The steps recited in claim 1
can be performed by any generic computer. The steps recited in claim 1,
such as receiving a request (receiving data), determining an account and a
communication device of the borrower (processing data), requesting
information and receiving information (transmitting and receiving data),
authenticating an account (processing data) and initiating a funds transfer
(transmitting data), are all functions that can be done with any generic
processor.
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Claim 1 also merely recites a "payment server" and a "communication
device," and nothing indicates that either is a particular machine. There is
no transformation or reduction of a particular machine to a different state or
thing. We find that the claim does not integrate the judicial exception
recited in the claim into a practical application. See Guidance 55.
We determine that claim 1 is directed to an abstract idea.
Turning to the second step of the Alice analysis, because we find that
the claims are directed to abstract idea, claim 1 must include an "inventive
concept" in order to be patent-eligible, i.e., there must be an element or
combination of elements that is sufficient to ensure that the claim in practice
amounts to significantly more than the abstract idea itself. See Alice, 573
U.S. 208 at 218 (alteration in original) (quoting Mayo Collaborative Servs.
v. Prometheus Labs., Inc., 566 U.S. 66, 72-73 (2012)).
The introduction of a computer into the claims does not alter the
analysis at Alice step two.
[T]he mere recitation of a generic computer cannot
transform a patent-ineligible abstract idea into a
patent-eligible invention. Stating an abstract idea
"while adding the words 'apply it"' is not enough
for patent eligibility. Nor is limiting the use of an
abstract idea "'to a particular technological
environment."' Stating an abstract idea while
adding the words "apply it with a computer"
simply combines those two steps, with the same
deficient result. Thus, if a patent's recitation of a
computer amounts to a mere instruction to
"implemen[t]" an abstract idea "on . . . a
computer," that addition cannot impart patent
eligibility. This conclusion accords with the
preemption concern that undergirds our § 101
jurisprudence. Given the ubiquity of computers,
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wholly generic computer implementation is not
generally the sort of "additional featur[ e ]" that
provides any "practical assurance that the process
is more than a drafting effort designed to
monopolize the [ abstract idea] itself."
Alice, 573 U.S. 208 at 224 (alterations in original) ( citations omitted).
Instead, "the relevant question is whether the claims here do more
than simply instruct the practitioner to implement the abstract idea ... on a
generic computer." Id. at 225. They do not.
Taking the claim elements separately, the function performed by the
computer at each step of the process is purely conventional. Using a
computer to retrieve, select, and apply decision criteria to data, and modify
the data as a result, amounts to electronic data query, retrieval, and
alteration-some of the most basic functions of a computer. All of these
computer functions are well-understood, routine, conventional activities
previously known to the trading industry. See Elec. Power Grp., 830 F.3d at
1354; see also In re Katz Interactive Call Processing Patent Litig., 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").
In short, each step does no more than require a generic computer to perform
generic computer functions. As to the data operated upon, "even if a process
of collecting and analyzing information is 'limited to particular content' or a
particular 'source,' that limitation does not make the collection and analysis
other than abstract." SAP Am. Inc. v. InvestPic, LLC, 890 F.3d 1016, 1022
(Fed. Cir. 2018).
Considered as an ordered combination, the computer components of
Appellants' claims add nothing that is not already present when the steps are
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considered separately. The sequence of data reception-analysis-
access/display is equally generic and conventional. See Ultramercial, Inc. v.
Hulu, LLC, 772 F.3d 709, 715 (Fed. Cir. 2014) (the recited computer-
implemented sequence of receiving, selecting, offering for exchange,
display, allowing access, and receiving payment was not patent eligible),
Inventor Holdings, LLC v. Bed Bath & Beyond, Inc., 876 F.3d 1372, 1378
(Fed. Cir. 2017) (holding that the recited computer-implemented sequence of
data retrieval, analysis, modification, generation, display, and transmission
was not patent eligible), Two-Way Media Ltd. v. Comcast Cable Commc 'ns,
LLC, 874 F.3d 1329, 1339 (Fed. Cir. 2017) (holding that recited computer-
implemented sequence of processing, routing, controlling, and monitoring
was not patent eligible). The ordering of the steps is, therefore, ordinary and
conventional.
As we stated above, the claims do not, for example, purport to
improve the functioning of the payment server or communication device.
As we stated above, the claims do not affect an improvement in any other
technology or technical field. The Specification spells out different generic
equipment and parameters that might be applied using this concept and the
particular steps such conventional processing would entail based on the
concept of information access under different scenarios. (See, e.g., Spec.
,i,i 23, 55). Thus, the claims at issue amount to nothing significantly more
than instructions to apply the abstract idea using some unspecified, generic
computer. Under our precedents, that is not enough to transform an abstract
idea into a patent-eligible invention. See Alice, 573 U.S. 208 at 226.
\Ve have reviewed all the arguments (Appeal Br. 13-26; Reply Br. 3-
10) Appellants have submitted concen1ing the patent eligibility of the claims
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before us that stand rejected under 35 U.S.C. § 101. We find that our
analysis above substantially covers the substance of all the arguments, which
have been made. But, for purposes of completeness, we will address certain
arguments individuaHy.
We are not persuaded of error on the part of the Examiner by
Appellants argument that claim 1 provides technical solutions to problems in
the field of loan transactions. (App. Brief 7). The problems identified by
Appellants are (1) speed and certainty associated with certain types of loan
transactions and (2) providing security for the second identification
information during such loan transactions. (App. Brief 9). We agree with
the Examiner that both problems identified by Appellants related to the
business aspect of the claimed invention, in that making the transaction
process faster, or requiring information to make a transaction more secure,
are not computer-related issues. (Ans. 3). In this regard, as we stated above,
there is no improvement to the capability of the transaction server or
communication device recited in claim 1. In addition, Appellants have not
directed our attention to a disclosure in the Specification of an improved
transaction server or communication device. We also agree with the
Examiner that the steps of claim 1 are merely mental tasks for which a
generic computer (transaction server) is engaged to make the steps faster
which is achieved without improving any of the capabilities of the generic
computer. The fact that the steps can be performed more efficiently via a
computer does not materially alter the patent eligibility of the claimed
subject matter. See Bancorp Servs., L.L.C. v. Sun Life Assurance Co. of
Can. (U.S.), 687 F.3d 1266, 1278 (Fed. Cir. 2012).
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vVe are not persuaded of error on the part of the Examiner by
Appellants argument that claim 1 is directed toward processing a loan
transaction via an adaptive payrnent server, where the lender provides the
server and the server communicates with the borrower via a comnmnication
device of the bon-ower to receive second identification information of the
borrower, and where the server initiates an electronic funds transfer and that
these features amount to significantly more than the abstract idea. (App.
Brief l 0). \Ve agree with the Examiner that these recitations in claim 1 are
part of the abstract idea itself and therefore cannot amount to significantly
more than the abstract idea of processing lending transactions. (Final Act. 3;
Ans. 5). The Examiner correctly considered the recitation of a '"server" to be
a recitation of something in addition to the abstract idea, and correctly
detennined that this recitation is merely an instruction to irnplernent the
abstract idea on a computer that requires no more than a generic computer
for perform generic computer functions that are well-understood, routine and
conventional. (Final Act 3 ).
\Ve are not persuaded of error on the part of the Examiner by
AppeHants argument that the recited claims are analogous to the clairns in
BASCOM Global Internet Servs. v. AT&T Mobility LLC, 827 F.3d 1341
(Fed. Cir. 2016). tv1ore particularly, Appellants contend that the particular
combination of features in claim 1 c01Tespond to non-conventional and non-
generic arrangements of additional elements that amount to significantly
more that the abstract idea itself (Appeal Br. 11 ).
RASCOlvf provides guidance in relation to the second step of the two-
step framevvork for determining patent-eligibility. Id.
Contrary to Appellants' arguments, the Federal Circuit did not find
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that the claims in BASCOA1 recited an inventive concept solely because the
claims recited a particular combination of features that are non-conventional
in a non-generic arrangement Rather, in BASCOAf, the Federal Circuit
followed the Supreme Court's guidance for determining whether the claims
recite an inventive concept set forth in Alice Corp. Pty. Ltd. v. CLS Bank
International, 573 U.S. 208, 220-23 (2014).
In Alice, the Supreme Comi explained that, under the second step of
the patent-eligibility analysis, "the relevant question is whether the claims
here do more than simply inst1uct the practitioner to irnplement the abstract
idea of intennediated settlernent on a generic computer!' 573 lJ.S. 208,224
(2014). The Supreme Court also provided exarnpfos of cfaims that represent
more than instn1ctions to irnplernent an abstract idea on a generic computer,
such as clairns that purport to improve the functioning of the computer itself
and claims that effect an improvement in any other technology or technical
field. Id. at 224-25.
Turning to BASCO/vi, the Federal Circuit held "[t]he inventive
concept described and clairned in the '606 patent is the installation of a
filtering tool at a specific location, remote from end-users, with
customizable filtering features specific to each end user." 827 F.3d at 1350.
In detennining this feature to be an inventive concept, the Federal Circuit
explained that the remote location of a filtering tool, having customizable
user-specific filtering features, provides the filtering tool both the benefits of
a filter on a local computer and the benefits of a filter on the ISP server and
is a technical improvernent over prior art ways of filtering content Id. at
1350-51. Notably, the Federal Circuit specifically determined that "'the
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claims may be read to "improve[] an existing technological process."' Id. at
1351 ( citing Alice, 573 U.S. 208 at 222).
We do not agree with the Appellants that the features of the instant
invention are indisputably technical improvements that are more than simply
abstract aspects because, for example, electronic funds transfer transactions
occurs over specific electronic networks managed by the electronic
processors following specific electronic protocols. (Reply Brief 3).
Although the Appellants are correct that transactions are processed with
specific electronic protocols, there is no improvement to any existing
technological process recited in claim 1. In this regard, the transmission,
receipt and processing of the data in claim 1 is done in a conventional
manner using conventional generic computer elements.
We are not persuaded of error on the part of the Examiner by
Appellants' argument that the Examiner has not provided any evidence that
the processing the loan transaction in the manner recited in claim 1 is well-
understood and routine. (Appeal Br. 11 ). Initially we note that the finding
that recitations are well-understood and routine must be directed to features
of the claim that are in addition to the abstract idea. The manner of
processing the loan transaction is the abstract idea itself. The only features
of the claim that are in addition to the abstract idea are the server and the
communication device which, as we discussed above, are disclosed by
Appellants' own Specification as generic computer structures which perform
generic computer functions of transmitting and processing data.
We are not persuaded of error on the part of the Examiner by
Appellants argument that the claims do not preempt the entirety of loan
transactions. "\Vhiie preemption may signal patent ineligible subject matter,
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the absence of complete preemption does not demonstrate patent eligibility."
Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir.
2015); see also OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1362-
63 (Fed. Cir. 2015), cert. denied, 136 S. Ct. 701, 193 (2015) ("[T]hat the
claims do not preempt all price optimization or may be limited to price
optimization in the e-commerce setting do not make them any less
abstract."). And, "[w]here a patent's claims are deemed only to disclose
patent ineligible subject matter under the Mayo framework, as they are in
this case, preemption concerns are fully addressed and made moot." Ariosa,
788 F.3d at 1379.
In view of the foregoing, we will sustain the rejection of claim 1 under
35 U.S.C. §101. We will also sustain the rejection as it is directed to the
remaining claims because the Appellants have not argued the separate
eligibility of these claims.
REJECTION UNDER 35 U.S.C. §103(a)
We will not sustain this rejection because we agree with the
Appellants that Kapur does not disclose "receiving, by an adaptive payment
server, a request for a loan fund amount and first identificationfrom a
lender." The Examiner relies on Davis at paragraphs 45-49 for teaching this
subject matter. (Final Act. 5). Paragraph 46 of Davis discloses that the
employee or borrower supplies the loan request and that some combination
of payroll system or department operated by a third party provides the
authentication information. Paragraph 48 discloses that the authentication
system can pre-approve a large number of employees for small or short term
loans and thereafter an employee could quickly request a loan. According to
this disclosure, it is the borrower not the lender that makes the request for a
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loan fund amount and as such Kapur does not disclose the receiving step of
claim 1. Therefore, we will not sustain this rejection as it is directed to
claim 1 and claims 2-8 dependent therefrom. We will also not sustain this
rejection as it is direct to the remaining claims because claim 10, from which
claims 11-17 depend, also recites that the request for a loan amount is
received from a lender.
CONCLUSIONS OF LAW
We conclude the Examiner did not err in rejecting the appealed claims
under 35 U.S.C. § 101.
We conclude the Examiner did err in rejecting the appealed claims
under 35 U.S.C. §103(a).
DECISION
The decision of the Examiner to reject claims 1-8 and 10-1 7 under 3 5
U.S.C. §101 is affirmed.
The decision of the Examiner to reject claims 1-8 and 10-1 7 under 3 5
U.S.C. §103 is not affirmed.
No time period for taking any subsequent action in connection with
this appeal may be extended under 37 C.F.R. § l .136(a). See 37 C.F.R.
§ l.136(a)(l )(iv).
AFFIRMED
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