Ex Parte Keller et al

Patent Trials and Appeals Board

Jun 13, 2019

10281756 - (D) (P.T.A.B. Jun. 13, 2019)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE FIRST NAMED INVENTOR
10/281,756 10/28/2002 James B. Keller
22850 7590 06/17/2019
OBLON, MCCLELLAND, MAIER & NEUSTADT, L.L.P.
1940 DUKE STREET
ALEXANDRIA, VA 22314
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.
339696US28 4372
EXAMINER
POLLOCK, GREGORY A
ART UNIT PAPER NUMBER
3695
NOTIFICATION DATE DELIVERY MODE
06/17/2019 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):
patentdocket@oblon.com
OBLONPAT@OBLON.COM
iahmadi@oblon.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte JAMES B. KELLER and KAREN J. EDGER TON1
Appeal2018-005264
Application 10/281,756
Technology Center 3600
Before CAROLYN D. THOMAS, NABEEL U. KHAN, and
SCOTT E. RAEVSKY, Administrative Patent Judges.
THOMAS, Administrative Patent Judge.
DECISION ON APPEAL
Appellants seek our review under 35 U.S.C. § 134(a) of the
Examiner's Final Rejection of claims 1, 2, 5-13, 15, 16, 18-23, 25, 40, and
41 all the pending claims in the present application. Claims 3, 4, 14, 17, 24,
and 26-39 are canceled (see Claims Appendix). We have jurisdiction over
the appeal under 35 U.S.C. § 6(b).
We AFFIRM.
The present invention relates generally to evaluating and managing
short term risk (see Abstract).
1 Appellants name Swiss Reinsurance Company LTD as the real party in
interest (App. Br. 1 ).
Appeal2018-005264
Application 10/281,756
Independent claim 1, reproduced below, is representative of the
appealed claims:
1. A method of evaluating a plurality of individual short
term risks and for developing quotes for group life insurance
coverage, the method being performed on a processor of a first
computer system having a memory, the processor operating as an
apparatus for generating insurance quotes, the method comprising:
identifying a group, by the processor, comprising a
population of the individual risks from census data stored in the
memory;
assigning a baseline mortality factor, developed by
accessing and analyzing publicly available data to each of the
individual risks in the population;
developing, by a statistical regression technique by the
processor, a table of modification factors using a plurality of factors
correlated to the short term risk, the plurality of factors correlated to
the short-term risk including at least an amount of coverage, waiver of
premium definition, dependent spouse and child coverages, cases with
premium continuance for disabled lives, supplemental coverages,
smoking status, industry and location of workplace, wherein the
developing of the table of modification factors includes determining a
relative degree of correlation of a plurality of factors correlated to the
short term risks;
storing data relating to the individual risks, the baseline
mortality factors and the modification factors in the memory;
generating, by the processor, a rate factor for each of the
individual risks by multiplying the baseline mortality factors by the
modification factors in the processor;
dividing, by the processor, the individual rate factors by
the total number of people in the group to calculate a rate or rates for
the group;
generating, by the processor, a quote for life insurance
coverage for the group using the calculated rate or rates and storing
the quote in the memory of the processor for generating insurance
quotes;
storing data relating to the short term risk on the memory
of the first computer system, the data being entered in an input
template at a second computer system, and subsequently being
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Application 10/281,756
communicated to the first computer system for storage in the memory;
and
generating a quote for insurance coverage for the short
term risk using the data, one or more of the baseline mortality factors,
and one or more of the modification factors stored in the memory, and
communicating the generated quote to a user of the second computer
system.
Appellants appeal the following rejection: 2
Claims 1, 2, 5-13, 15, 16, 18-23, 25, 40 and 41 are rejected under
35 U.S.C. § 101 because the claimed invention is directed to patent-
ineligible subject matter (Final Act. 2-6).
We review the appealed rejections for error based upon the issues
identified by Appellants, and in light of the arguments and evidence
produced thereon. Ex parte Frye, 94 USPQ2d 1072, 1075 (BPAI 2010)
(precedential).
ANALYSIS
Rejection under§ 1 OJ
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. E.g., Alice Corp. v. CLS Bank Int 'l, 573 U.S. 208,
216 (2014).
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. Id. at 217-18 ( citing Mayo Collaborative Servs. v. Prometheus
2 The Examiner withdrew the rejections under 35 U.S.C. § 103 (see Ans. 3).
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Labs., Inc., 566 U.S. 66, 75-77 (2012)). In accordance with the framework,
we first determine what concept the claim is "directed to." See Alice, 573
U.S. at 219 ("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."). For example, 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)).
Recently, the USPTO published revised guidance on the application
of 35 U.S.C. § 101. USPTO's 2019 Revised Patent Subject Matter
Eligibility Guidance, 84 Fed. Reg. 50 (Jan. 7, 2019) ("Revised Guidance").
Under the Revised Guidance "Step 2A," the office first looks 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 (see MPEP § 2106.05(a)-(c), (e)-(h)). 84 Fed. Reg. at
51-52, 55.
Only if a claim (1) recites a judicial exception and (2) does not
integrate that exception into a practical application, does the Office then
(pursuant to the Revised Guidance "Step 2B") look to whether the claim:
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(3) adds a specific limitation beyond the judicial exception that is not
"well-understood, routine, conventional" in the field (see MPEP
§ 2106.05(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. 84 Fed. Reg. at 56.
Step 2A, Prong 1 (Does the Claim Recite a Judicial Exception?)
With respect to independent method claim 1, and similarly, system
claim 41, the Examiner determines that the claims are at least directed to the
abstract idea of "evaluating a plurality of individual short term risks and for
developing quotes for group life insurance coverage" (Final Act. 3), which
we conclude are certain methods of organizing human activity, i.e.,
fundamental economic principles including hedging, insurance, or mitigating
risk (see also id. at 5).
The Specification discloses:
The invention of the present application is more particularly directed
to the evaluation of short term risks. Specifically, the invention of the
present application provides a system and method to facilitate initial
evaluation, and periodic reevaluation (i.e., re-underwriting), of various
types of short term risks.
Spec. 3: 17-20.
One aspect of the system and method of the present invention is the
provision of an input data template to facilitate collection of input data
used in the process of evaluating short term risk.
Spec. 5:16-18.
Claim 1 recites at least the following limitations: (1) "identifying a
group," (2) "assigning a baseline mortality factor," (3) "developing ... a
table of modification factors ... correlated to the short-term risk,"
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( 4) "storing data relating to the individual risks ... baseline mortality ...
[and] modification factors," (5) "generating ... a rate factor," (6) "dividing
... the individual rate factors by the total number of people in the group,"
( 6) "generating ... a quote for life insurance coverage for the group,"
(7) "storing data relating to the short term risk," and (8) "generating a quote
for insurance coverage for the short term risk." These limitations, under
their broadest reasonable interpretation, recite fundamental economic
practices akin to hedging, insurance, and mitigating risk because the
limitations all recite operations that would ordinarily take place in the
insurance industry. Alice, 573 U.S. at 219-20 (concluding that use of a third
party to mediate settlement risk is a "fundamental economic practice" and
thus an abstract idea); id. (describing the concept of risk hedging identified
as an abstract idea in Bilski as "a method of organizing human activity");
Bilski, 561 U.S. at 611-612 (concluding that hedging is a "fundamental
economic practice" and therefore an abstract idea); Bancorp, 687 F.3d at
1280 ( concluding that "managing a stable value protected life insurance
policy by performing calculations and manipulating the results" is an
abstract idea); Inventor Holdings, LLC v. Bed Bath & Beyond, Inc., 876 F.3d
1372, 1378-79 (Fed. Cir. 2017) (holding that concept of "local processing of
payments for remotely purchased goods" is a "fundamental economic
practice, which Alice made clear is, without more, outside the patent
system."); OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1362-63
(Fed. Cir. 2015) (concluding that claimed concept of "offer-based price
optimization" is an abstract idea "similar to other 'fundamental economic
concepts' found to be abstract ideas by the Supreme Court and this court").
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We further determine that these limitations, under their broadest
reasonable interpretation, also recite mental processes. For instance, a claim
recites a mental process when the claim encompasses acts people can
perform using their minds or pen and paper. See, e.g., CyberSource Corp. v.
Retail Decisions, Inc., 654 F.3d 1366, 1372-73 (Fed. Cir. 2011)
( determining that a claim whose "steps can be performed in the human mind,
or by a human using a pen and paper" is directed to an unpatentable mental
process). This is true even if the claim recites that a generic computer
component performs the acts. See, e.g., Versata Dev. Grp., Inc. v. SAP Am.,
Inc., 793 F.3d 1306, 1335 (Fed. Cir. 2015) ("Courts have examined claims
that required the use of a computer and still found that the underlying,
patent-ineligible invention could be performed via pen and paper or in a
person's mind."); see also 2019 Eligibility Guidance 84 Fed. Reg. at 52 n.14
("If a claim, under its broadest reasonable interpretation, covers performance
in the mind but for the recitation of generic computer components, then it is
still in the mental processes category unless the claim cannot practically be
performed in the mind.").
These limitations encompass acts people can perform using their
minds or pen and paper because people can perform the "identifying" step
by simply observing the census data and recognizing a group of individual
risks. People can also perform the "assigning," "developing," "generating,"
and "dividing" steps by observing the data and using pen and paper to
evaluate the results. Finally, people can "store" information by merely
remembering the data or writing it down on paper.
For at least the following reasons noted supra, we are persuaded that
representative claim 1 recites plural abstract ideas.
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Appellants challenge the Examiner's determinations on the ground
that "the Office Action provides no specific rationale in support of these
assertions ... Instead, the Office Action resorts to overgeneralizations of the
claim language" (App. Br. 7). We disagree with Appellants' assertion.
Here, "the claims are considered in their entirety to ascertain whether
their character as a whole is directed to excluded subject matter." Internet
Patents Corp. v. Active Network, Inc., 790 F.3d 1343, 1346 (Fed. Cir. 2015).
For example, the Examiner highlights specific claim language (see Final
Act. 3--4; see also Ans. 4-7) and compares such language to concepts
previously found to be abstract concepts (Final Act. 4-5; see also Ans. 4-7),
and we supplement such determinations according to the Revised Guidance.
Therefore, for at least the aforementioned reasons, we agree with the
Examiner that claim 1 recites an abstract idea, which we conclude is "a
fundamental economic practice" and/ or "mental processes."
Step 2A-Prong 2 (integration into Practical Application) 3
Under the Revised Guidance, we now must determine if additional
elements in the claims integrate the judicial exception into a practical
application (see MPEP § 2106.05(a)-(c), (e)-(h)).
We discern no additional element ( or combination of elements)
recited in Appellants' representative claim 1 that integrates the judicial
exception into a practical application. See Revised Guidance, 84 Fed. Reg.
at 54-55 ("Prong 2"). For example, Appellants' claimed additional elements
3 We acknowledge that some of the considerations at Step 2A, Prong 2,
properly may be evaluated under Step 2 of Alice (Step 2B of the Office
revised guidance). For purposes of maintaining consistent treatment within
the Office, we evaluate them under Step 1 of Alice (Step 2A of the Office
revised guidance). See Revised Guidance, 84 Fed. Reg. at 55 n.25, 27-32.
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( e.g., "a processor," "a first computer system," "a second computer system,"
"a memory," and "a statistical regression technique") do not: (1) improve
the functioning of a computer or other technology; (2) are not applied with
any particular machine (except for a generic computer); (3) do not effect a
transformation of a particular article to a different state; and ( 4) are not
applied in any meaningful way beyond generally linking the use of the
judicial exception to a particular technological environment, such that the
claim as a whole is more than a drafting effort designed to monopolize the
exception. See MPEP §§ 2106.05(a)-(c), (e)-(h).
Appellants contend that "the claims of this application define a useful
tool that solves the problem of how to provide automated short-term risk
measurements and analysis despite the fact that short-term risks vary greatly
under changing conditions" (App. Br. 7-8 (citing Spec. ,r,r 4-5)). In other
words, Appellants emphasize how they have "automated" the evaluation of
short-term risk.
Appellants' Specification discloses:
Short term risks are those that are underwritten or evaluated on a
recurring periodic basis. Many of these risks are underwritten
annually, biannually, or after some other relatively brief time period.
When insuring short term risks, insurance companies have periodic
opportunities to reevaluate the risk and to reflect changes in
conditions which may impact the risk in the design and pricing of
insurance products.
Spec.3:1-5.
The invention of the present application is more particularly directed
to the evaluation of short term risks. Specifically, the invention of the
present application provides a system and method to facilitate initial
evaluation, and periodic reevaluation (i.e., re-underwriting), of various
types of short term risks.
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Application 10/281,756
Spec. 3: 17-20.
The system and method allow for more precise and rigorous analysis
and underwriting of certain short term risks.
Abstract.
Appellants do not direct our attention to anything in the Specification
to indicate that the invention provides an improvement in the computer's
technical functionality. Instead, the claimed method merely automates an
abstract idea, which can be performed using pen and paper. Specifically, the
claimed processor, first and second computers, memory, and statistical
regression technique are merely being used as tools to automate
conventional activities. McRO, Inc. v. Bandai Namco Games Am. Inc., 837
F.3d 1299, 1316 (Fed. Cir. 2016) (incorporation of particular claimed rules
in computer animation "improved [the] existing technological process,"
rather than merely used the computer as a "tool to automate conventional
activity"). Claim limitations, which merely include instructions to
implement an abstract idea on a computer or a network of computers, or
merely uses a computer or a network of computers as a tool to perform an
abstract idea do not evidence the integration of an abstract idea into a
practical application. See MPEP § 2016.05(±); see also Credit Acceptance
Corp. v. Westlake Services, 859 F.3d 1044 (Fed. Cir. 2017) (using a
computer as a tool to process an application for financing a purchase).
Moreover, nothing in the claims, understood in light of the
Specification, requires anything other than an off-the-shelf, conventional
computer used for collecting and processing/analyzing various
information/ data.
For at least the reason noted supra, we determine that claim 1
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(1) recites a judicial exception and (2) does not integrate that exception into
a practical application. Thus, representative claim 1 is directed to the
aforementioned abstract idea.
Alice/Mayo-Step 2 (Inventive Concept)
Step 2B identified in the Revised Guidance
Turning to the second step of the Alice inquiry, we now look to
whether claim 1 contains any "inventive concept" or adds anything
"significantly more" to transform the abstract concept into a patent-eligible
application. Alice, 573 U.S. at 216. As recognized by the Revised
Guidance, an "inventive concept" under Alice step 2 can be evaluated based
on whether an additional element or combination of elements:
( 1) "adds a specific limitation or combination of limitations that are
not well-understood, routine, conventional activity in the field,
which is indicative that an inventive concept may be present;"
or
(2) "simply appends well-understood, routine, conventional
activities previously known to the industry, specified at a high
level of generality, to the judicial exception, which is indicative
that an inventive concept may not be present."
See Revised Guidance, 84 Fed. Reg. at 56; see MPEP § 2106.05(d).
We find no element or combination of elements recited in Appellants'
claim 1 that contains any "inventive concept" or adds anything "significantly
more" to transform the abstract concept into a patent-eligible application.
Appellants have not adequately explained how claim 1 is performed such
that it is not a routine and conventional function of a generic computer.
Furthermore, a finding of novelty or non-obviousness does not require the
conclusion that the claimed subject matter is patent-eligible. Although the
second step in the Mayo/Alice framework is termed a search for an
"inventive concept," the analysis is not an evaluation of novelty or
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nonobviousness, but, rather, is a search for "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,
573 U.S. at 216. "Groundbreaking, innovative, or even brilliant discovery
does not by itself satisfy the§ 101 inquiry." Ass 'n.for Molecular Pathology
v. Myriad Genetics, Inc., 569 U.S. 576, 591 (2013). A novel and non-
obvious claim directed to a purely abstract idea is, nonetheless, patent-
ineligible. See Mayo, 566 U.S. at 90. See also Diamond v. Diehr, 450 U.S.
175, 188-89 (1981) ("The 'novelty' of any element or steps in a process, or
even of the process itself, is of no relevance in determining whether the
subject matter of a claim falls within the § 101 categories of possibly
patentable subject matter."). Thus, we find unavailing Appellants'
contention that "[s]ince the claims of this application cannot be rejected
based on any art of record, the claims cannot fairly be considered to be
'well-understood, routine or conventional"' (Reply Br. 5), given the
aforementioned discussion regarding novelty.
Because Appellants' independent claim 1 is directed to a patent-
ineligible abstract concept, does not include additional elements that
integrate the judicial exception into a practical application, and does not add
a specific limitation beyond the judicial exception that is not "well-
understood, routine, and conventional," we sustain the Examiner's rejection
of the claims under 35 U.S.C. § 101 as being directed to non-statutory
subject matter in light of Alice, its' progeny, and the Revised Guidance.
DECISION
We affirm the Examiner's § 101 rejection.
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No time period for taking any subsequent action in connection with
this appeal may be extended under 37 C.F.R. § 1.136(a)(l)(iv).
AFFIRMED
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