Ex Parte Tatavu et al

Patent Trials and Appeals Board

Jun 13, 2019

11491427 - (D) (P.T.A.B. Jun. 13, 2019)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE FIRST NAMED INVENTOR
13/866,927 04/19/2013 Cory H. Siddens
66945 7590 06/17/2019
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.
79900-867783(021300USNP) 3085
EXAMINER
GREGG, MARY M
ART UNIT PAPER NUMBER
3697
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):
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 CORY H. SIDDENS, and B. SCOTT BODING 1
Appeal2017-010236
Application 13/866,927
Technology Center 3600
Before ERIC S. FRAHM, JOHN D. HAMANN, and
MATTHEW J. McNEILL, Administrative Patent Judges.
FRAHM, Administrative Patent Judge.
DECISION ON APPEAL
STATEMENT OF THE CASE
Appellants seek our review under 35 U.S.C. § 134(a) of the
Examiner's decision rejecting claims 1, 4, 5, 7, 10-12, 14, 16, 17, 19, and
22-26, which constitute all the claims pending in this application (Appeal
Br. 3; Final Act. 2). We have jurisdiction under 35 U.S.C. § 6(b).
1 According to Appellants, Visa International Service Association is the real
party in interest (Appeal Br. 3).
Appeal2017-010236
Application 13/866,927
We affirm the Examiner's rejection under 35 U.S.C. § 101 as being
directed to patent-ineligible subject matter; and we reverse the Examiner's
(i) anticipation rejection under 35 U.S.C. § 102(a)(2), and (ii) obviousness
rejection under 35 U.S.C. § 103, using the same base reference relied on in
the anticipation rejection.
Appellants 'Invention
Appellants' invention relates to methods and systems for
automatically detecting fraudulent activity in payment transactions with
merchants (Spec. ,r,r 2-3) by generating rule profile reports in a fraud
detection system (Spec. ,r 5). The rule profile reports include statistical data
regarding the performance of fraud rules (Spec. ,r 5). Fraud rules are rules
that may be used to automatically detect fraudulent activity in a payment
transaction, or if a payment account has been compromised (Spec. ,r 2). A
fraud rule may reject or approve a transaction occurring at a payment
account issuer, payment processing network, merchant processor, or acquirer
(Spec. ,r 2). In one disclosed embodiment, a processor determines (i) a rule
profile comprising a plurality of rules and each rule in the plurality of rules
is associated with a plurality of rule outcomes; and (ii) a plurality of rule
outcome frequencies associated with the plurality of rule outcomes (Spec.
,r 6). Each rule outcome in the plurality of rule outcomes is associated with
an outcome for a transaction (Spec. ,r 6).
Illustrative Claim
Independent claim 1, reproduced below with bracketed lettering and
emphasis added to the disputed portion of the claim, is illustrative of the
claimed subject matter:
1. A computer-implemented method comprising:
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receiving, by a fraud detection server from a client
computer, one or more search parameters indicating one or more
transaction criteria for searching historical payment transactions
that have been processed by the fraud detection server;
retrieving, by the fraud detection server from a transaction
database operably connected to the fraud detection server, a
plurality of historical payment transactions that have been
processed by the fraud detection server and that satisfy the one
or more search parameters;
retrieving, by the fraud detection server, final dispositions
for the plurality of historical payment transactions, a final
disposition of a historical payment transaction being determined
after the historical payment transaction occurred and being one
of a plurality of predefined final dispositions, each indicating
whether the historical payment transaction is fraudulent or non-
fraudulent;
determining, by the fraud detection server, a fraud rule
profile associated with the retrieved plurality of historical
payment transactions, the fraud rule profile comprising a
plurality of fraud rules stored in a fraud rules database operably
connected to the fraud detection server;
[A] generating, by the fraud detection server, rule
outcomes by applying the plurality of fraud rules to the plurality
of historical payment transactions, each of the rule outcomes
being one of a plurality of predefined rule outcomes and
indicating an action that would have been peiformed by a
processing computer regarding authorization of the historical
payment transaction according to a fraud rule;
for each fraud rule of the plurality of fraud rules:
determining, by the fraud detection server, one or more
rule outcome frequencies respectively corresponding to one or
more of the plurality of predefined rule outcomes by aggregating
the rule outcomes for historical payment transactions associated
with the fraud rule; and
determining, by the fraud detection server, one or more
final disposition frequencies respectively corresponding to one
or more of the plurality of predefined final dispositions for the
historical payment transactions associated with the fraud rule by
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aggregating the final dispositions for historical payment
transactions associated with the fraud rule; and
responsive to receiving the one or more search parameters,
providing, by the fraud detection server, the plurality of rule
outcome frequencies and the plurality of final disposition
frequencies to the client computer to cause the client computer
to display a comparison of the one or more rule outcome
frequencies with the one or more final disposition frequencies for
each fraud rule of the fraud rule profile.
Rejections on Appeal
(1) Claims 1, 4, 5, 7, 10-12, 14, 16, 17, 19 and 22-26 stand rejected
under 35 U.S.C. § 101 as being directed to patent-ineligible subject matter
(Final Act. 8-30).
(2) Claims 1, 4, 5, 7, 10-12, 14, 16, 17, 19, 22 and 24--26 stand
rejected under 35 U.S.C. § I02(a)(2) by Wright et al. (US 2002/0194119 Al,
Dec. 19, 2002) (hereinafter "Wright") (Final Act. 31--48).
(3) Claim 23 stands rejected under 35 U.S.C. § I03(a) as being
unpatentable over Wright and Emde et al. (US 2004/0236651 Al; Nov. 25,
2004) (hereinafter "Emde") (Final Act. 48--49).
ANALYSIS
Patent Eligibility
Under 35 U.S.C. § 101, a patent may be obtained for "any new and
useful process, machine, manufacture, or composition of matter, or any new
and useful improvement thereof." The Supreme Court has "long held that
this provision contains an important implicit exception: Laws of nature,
natural phenomena, and abstract ideas are not patentable." Alice Corp. Pty.
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Ltd. v. CLS Bank Int 'l, 573 U.S. 208, 216 (2014) (quoting Ass 'nfor
Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. 576, 589 (2013)).
The Supreme Court, in Alice, reiterated the two-step framework
previously set forth in Mayo Collaborative Services v. Prometheus
Laboratories, Inc., 566 U.S. 66, 77-80 (2012), "for distinguishing patents
that claim laws of nature, natural phenomena, and abstract ideas from those
that claim patent-eligible applications of those concepts." Alice, 573 U.S. at
217. Assuming that a claim nominally falls within one of the statutory
categories of machine, manufacture, process, or composition of matter, the
first step in the analysis is to "determine whether the claims at issue are
directed to one of those patent-ineligible concepts" (id.), e.g., to an abstract
idea. 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."). Concepts determined to be abstract
ideas, and thus patent ineligible include, but are not limited to, 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, 67 (1972)). Concepts
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.
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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 176; 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."). The
Supreme Court continued by qualifying its findings, indicating 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 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 claims are not directed to an abstract idea, the inquiry ends.
Otherwise, the inquiry proceeds to the second step of the Alice and Mayo
framework where the elements of the claims are considered "individually
and 'as an ordered combination' to determine whether the additional
elements 'transform the nature of the claim' into a patent-eligible
application." Alice, 573 U.S. at 217 (quoting Mayo, 566 U.S. at 78-79).
This second step is described as "a search for an 'inventive concept'-i.e.,
an element or combination of elements that is ' ... significantly more than
... the [ineligible concept] itself."' Id. at 217-218 (alteration in original)
(quoting Mayo, 566 U.S. at 72-73). "A claim that recites an abstract idea
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must include 'additional features' to ensure 'that the [claim] is more than a
drafting effort designed to monopolize the [abstract idea]."' Alice, 573 U.S.
at 221 ( 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 Court acknowledged in Mayo that "all inventions at some level
embody, use, reflect, rest upon, or apply laws of nature, natural phenomena,
or abstract ideas." Mayo, 566 U.S. at 71. We, therefore, look to whether the
claims focus on a specific means or method that improves the relevant
technology or are instead directed to a result or effect that itself is the
abstract idea and merely invoke generic processes and machinery. See
Enfzsh, LLC v. Microsoft Corp., 822 F.3d 1327, 1336 (Fed. Cir. 2016).
The PTO recently published revised guidance on the application of
§ 101. USPTO's 2019 Revised Patent Subject Matter Eligibility Guidance,
84 Fed. Reg. 50 (Jan. 7, 2019) (hereinafter "2019 Revised Guidance").
Under that guidance, after determining that a claim falls within one of the
statutory categories under § 101 (hereinafter "Step 1 "), we 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 activities such as a fundamental economic practice, or mental
processes) (hereinafter "Step 2A, Prong 1 "); and
(2) additional elements that integrate the judicial exception into a
practical application (see MPEP § 2106.05(a}-(c), (e}-(h))
(hereinafter "Step 2A, Prong 2").
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:
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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
§ 106.05(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. 2
See 2019 Revised Guidance.
Revised Guidance Steps 1 and 2A, Prong 1
Under Step 1 in the patent-eligibility inquiry under § 101, in
accordance with the Revised Guidance, we determine whether the claims are
directed to one of the four statutory categories of invention, i.e., a process,
machine, manufacture, or composition of matter.
Each of independent claims 1 and 11 recite "[a] computer-
implemented method" performed by a "fraud detection server." Therefore,
claims 1 and 11, as well as claims 4, 5, 12-14, and 22-26 depending
respectively therefrom, as method claims, recite at least one of the
enumerated categories (i.e., a process) of eligible subject matter in 35 U.S.C.
§ 101.
Independent claims 7 and 16 recite the computer server and associated
computer elements in apparatus format. Claim 7 recites "[a] server
computer, comprising ... a processor; and a non-transitory computer-
readable storage medium ... for implementing a method" with the use of "a
client computer," "a transaction database," "a fraud rules database," and "a
processing computer." Claim 16 recites "[a] computer, comprising: a
display, a processor coupled to the display; and a non-transitory computer-
2 Items (3) and ( 4) are collectively referred to as "Step 2B" hereinafter and
in the 2019 Revised Guidance.
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readable storage medium coupled to the processor," and "a server
computer." Therefore, claims 7 and 16, as well as claims 10 and 17-19
depending respectively therefrom, as system claims, recite at least one of the
enumerated categories (i.e., a machine and/or manufacture) of eligible
subject matter in 35 U.S.C. § 101.
Therefore, as to claims 1, 4, 5, 7, 10-12, 14, 16, 17, 19, and 22-26, we
continue our analysis under Step 2A, Prong 1 of the Revised Guidance to
determine whether the claims ( 1) recite a judicial exception ( a law of nature,
natural phenomenon, or subject matter within the enumerated groupings of
abstract ideas above); and (2) the claims are patent-eligible.
Step 2A, Prong 1
Under Step 2A, Prong 1, we determine whether claims 1, 4, 5, 7, 10-
12, 14, 16, 17, 19, and 22-26 recite an abstract idea.
For the reasons that follow, we conclude that claims 1, 4, 5, 7, 10-12,
14, 16, 17, 19, and 22-26 are directed to a judicial exception (a law of
nature, natural phenomenon, or subject matter within the enumerated
groupings of abstract ideas above), because the recited claim limitations (i)
fall within the enumerated groupings of abstract ideas - namely certain
methods of organizing human activity ( e.g., fundamental economic
principles or practices; commercial or legal interactions; mitigating risk;
business relations) and mental processes, and (ii) do not contain additional
elements that integrate the judicial exception into a practical application.
Informed by our judicial precedent, the recent Revised Guidance
extracts and synthesizes key concepts identified by the courts as abstract
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ideas to explain that the abstract idea exception includes the following
groupings of subject matter, when recited as such in a claim limitation:
(a) Mathematical concepts-mathematical relationships,
mathematical formulas or equations, mathematical calculations;
(b) Certain methods of organizing human activity-
fundamental economic principles or practices (including
hedging, insurance, mitigating risk); commercial or legal
interactions (including agreements in the form of contracts;
legal obligations; advertising, marketing or sales activities or
behaviors; business relations); managing personal behavior or
relationships or interactions between people (including social
activities, teaching, and following rules or instructions); and
( c) Mental processes----concepts performed in the human mind
(including an observation, evaluation, judgment, opinion).
Under the Revised Guidance, if the claim does not recite a judicial
exception (a law of nature, natural phenomenon, or subject matter within the
enumerated groupings of abstract ideas above), then the claim is patent-
eligible at Step 2A, Prong 1.
However, if the claim recites a judicial exception (i.e., an abstract idea
enumerated above, a law of nature, or a natural phenomenon), the claim
requires further analysis for a practical application of the judicial exception
in Step 2A, Prong 2.
Here, the Examiner rejects the claims based on a detailed analysis of
the individual limitations of each of independent claims 1, 7, 11, and 16 (see
Final Act. 8-30), and determines that the claims are directed to the abstract
idea of "measuring fraud rule [test] performance by calculating rule [test]
outcome frequencies and final disposition frequencies associated with fraud
rules [test]s" (Final Act. 11; see also Final Act. 8, 14, 17-18, 20, 25, 28
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making similar findings for each of claims 1, 7, 11, and 16). The Examiner
determines that "[ t ]he focus of claim[ s] is not directed toward improvement
of the fraud server function or provid[ing] any unconventional steps
performed by the fraud server that confine the claim to a particular
application" (Ans. 9), rather the claimed limitations are directed toward
limitations that operate on financial data and cause the computer to display
results (see Ans. 9). Therefore, the Examiner concludes that "when
considered as a whole the claimed subject matter is not directed toward a
technological invention but rather directed toward business practices" (Ans.
9) ( emphasis added). We agree with the Examiner's findings and
conclusions.
The Federal Circuit has explained that one way of determining
whether claims are patent-eligible under Section 101 "is to examine earlier
cases in which a similar or parallel descriptive nature can be seen-what
prior cases were about, and which way they were decided." Amdocs (Israel)
Ltd. v. Openet Telecom, Inc., 841 F.3d 1288, 1294 (Fed. Cir. 2016). The
Federal Circuit also noted in that decision that "examiners are to continue to
determine if the claim recites (i.e., sets forth or describes) a concept that is
similar to concepts previously found abstract by the courts." Id. at 1294 n.2.
At least the following decisions from our reviewing court have found
many types of fundamental commercial practices patent ineligible: 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."); 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."); OIP Technologies, Inc. v. Amazon.com, Inc., 788
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F.3d 1359 (Fed. Cir. 2015), cert. denied, 136 S. Ct. 701 (mem) (2015) (offer-
based price optimization); buySafe, Inc. v. Google, Inc., 765 F.3d 1350 (Fed.
Cir. 2014) (transaction guaranty); Personalized Media Communications,
L.L.C. v. Amazon, Inc., 671 F. App'x. 777 (mem) (Fed. Cir. 2016) (receiving
instructions for ordering); Macropoint, LLC v. Fourkites, Inc., 671 F. App'x
780 (mem) (Fed. Cir. 2016) (tracking freight); Wireless Media Innovations,
LLC v. Maher Terminals, LLC, 636 F. Appx. 1014 (mem) (Fed. Cir. 2016)
(monitoring shipping containers); America's Collectibles Network Inc. v.
Jewelry Channel, Inc. USA, 672 F. App'x 997 (mem) (Fed. Cir. 2017)
(conducting reverse auction by adjusting price and inventory); and Easy Web
Innovations, LLC v. Twitter, Inc., No. 2016-2066, 2017 WL 1969492 (Fed.
Cir. 2017) (receiving, authenticating, and publishing data). Concepts
determined to be abstract ideas, and thus patent ineligible include, but are
not limited to, certain methods of organizing human activity, such as
fundamental economic practices (Alice, 573 U.S. at 219--20; Bilski, 561 U.S.
at 611).
The Federal Circuit has also found that performing operations on
payment transactions, including the collecting and storing of transaction
data, is a well-known business practice that is not patent eligible. See, e.g.,
Smart Sys. Innovations, LLC v. Chicago Transit Auth., 873 F.3d 1364,
1371-72 (Fed. Cir. 2017) ("Taken together, the Asserted Claims are directed
to the formation of financial transactions in a particular field ... and data
collection related to such transactions," which is "an abstract idea under
Alice step one."); Content Extraction & Transmission LLC v. Wells Fargo
Bank, Nat 'l Ass 'n, 776 F.3d 1343, 1347 (Fed. Cir. 2014) (summarizing
precedent in which "claims directed to the performance of certain financial
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transactions" involve abstract ideas and holding that claims drawn to the
abstract concept of financial transaction-related "data collection, recognition,
and storage is undisputedly well-known."); CyberSource Corp. v. Retail
Decisions, Inc., 654 F.3d 1366, 1370 (Fed. Cir. 2011) (finding a method for
"verifying the validity of a credit card transaction over the Internet" to be an
abstract idea).
Further, merely combining several abstract ideas (such as the
fundamental economic practice of mitigating risk, and a method of
organizing human activity in the field of payment transactions using fraud
rules) does not render the combination any less abstract. RecogniCorp, 855
F.3d at 1327 ("Adding one abstract idea ... to another abstract idea ... does
not render the claim non-abstract."); see also FairWarning IP, LLC v. latric
Sys., Inc., 839 F.3d 1089, 1094 (Fed. Cir. 2016) (determining the pending
claims were directed to a combination of abstract ideas).
Applying these principles here, we observe independent claims 1, 7,
11, and 16 are drawn to mitigating fraud risk by evaluating fraud rule
outcomes and final dispositions (mitigating risk), measuring fraud rule
peiformance by performing operations on historical payment transactions
indicating whether transactions are fraudulent or non-fraudulent (business
relations between people and/or commercial/legal interactions), and fraud
rule outcome analysis used to detect/prevent fraud in payment transactions
(mental processes such as observation, evaluation, and judgment). Thus,
claims 1, 7, 11, and 16 each recite a combination of abstract ideas, such as
fundamental economic practices, commercial or legal interactions,
mitigating risk, and mental processes, any and all of which have been found
to be patent ineligible by our reviewing courts.
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In Trading Technologies International, Inc. v. !BG LLC, 921 F.3d
1378 (Fed. Cir. 2019), the Federal Circuit affirmed the Board's decision that
the challenged claims ,:vere not patent eligible under 35 U.S.C. § 101,
because the claims were directed to a '"business problem" to provide traders
additional information, such as profit and loss data, on an existing trading
screen. The Court held that this was not a technofogica1 solution because it
<..,
"improv[ ed] the trader, not the functioning of the computer.~' T'lie Cmni. also
affinned the Board's conclusion that the c1airns were directed to an
unpatentable abstract idea of calculating and displaying information that "is
nothing more than 'mere automation of manual processes using
computers,''' and held that the claims failed to recite an inventive concept
because the clairned trading screen simply took the prior art trading screen
and added profit and loss values along the axis.
Here, in the case before us, claims 1, 7, 11, and 16 are directed to the
business problem of mitigating risk through the provision of an automated
evaluation of fraud rules (i.e., automating a manual evaluation process)
(Spec. ,r 3), assisted by displaying a comparison of rule outcome frequencies
with final disposition frequencies for each fraud rule ( claims 1, 7, 11, and
16, see last paragraph of each claim). As in Trading Technologies, here, the
display of the rule outcome frequencies and final disposition frequencies
does not make the computer faster, but assists the merchant or fraud rule
analyst, who have a high transaction volume, in reviewing fraud rule
outcomes and identifying interactions between fraud rules faster (see Spec.
,r 3). Furthermore, Appellants in the case before us disclose that
"[ e ]mbodiments of the invention address these and other problems" (Spec.
,r 4 ). Therefore, Appellants have automated a manual fraud rule evaluation
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process, and not provided an improvement to the operation of a computer,
server, database, or display.
We also agree with the Examiner's finding that displaying data, as
done in claims 1, 7, 11, and 16, is an insignificant post-solution activity to
the combination of abstract ideas, which does not otherwise make a patent
ineligible claim patent eligible (see Ans. 12 citing Flook).
Appellants' contention that instead of improving the functioning of a
computer or a technological process, the claims before us are an
"improvement to the manner in which a computer operates such an
improvement to a specific software operation" (Appeal Br. 14), is
unpersuasive. Appellants assert that the recited features "facilitate more
user-friendly and efficient retrieval and aggregation of fraud rule
performance data" (Appeal Br. 14). Although we agree with this last
statement, it only serves to support our determination above that the recited
limitations do not make the computer faster, but assist the merchant or fraud
rule analyst, who have a high transaction volume, in reviewing fraud rule
outcomes and identifying interactions between fraud rules faster. In other
words, the user of the software is able to make fraud rule determinations
faster by automating a manual process, but there is still no improvement to
software or computer elements.
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Appellants' argument (Appeal Br. 18) that the claims here cannot be
directed to a mental process in light of the decision in Cal. Inst. Technology
v. Hughes Commc 'ns Inc., 59 F.Supp.3d 974 (2014), is unpersuasive, as well
as this district court decision is not binding precedent on the PTAB.
Appellants' argument is premised on the contentions that (i) although a
computer can perform the same math as a human, a human cannot always
achieve the same results (of identifying fraud ndes) as a computer; and (ii)
humans cannot perfonn calculations in order to detennine fraud rule
effectiveness based on detected historical fraudulent transactions (see
Appeal Br. 18). This is not persuasive because the recited invention is
simply the automation of a manual fraud n1le evaluation process, and merely
assists a merchant or other human perform the process faster (see supra p.
15 citing Spec. ,r~ 3, 4).
We are also not persuaded by Appellants' argument that the Examiner
has oversimplified the claims in determining they are focused on an abstract
idea (see App. Br. 12-13). As discussed above, certain limitations in claims
1, 7, 11, and 16 essentially recite the fundamental economic practice of
measuring fraud rule performance based on comparisons and calculations
performed on historical payment transaction data (i.e., whether previous
transactions were fraudulent or not). The fact that we or the Examiner may
refer to this practice by the shorthand "measuring fraud rule performance"
does not change the outcome of the analysis. See Apple, Inc. v. Ameranth,
Inc., 842 F.3d 1229, 1240-41 (Fed. Cir. 2016) ("An abstract idea can
generally be described at different levels of abstraction .... The Board's
slight revision of its abstract idea analysis does not impact the patentability
analysis."). And, notably, even Appellants describe the embodiments of the
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invention as (i) "methods and systems for generating rule profile reports in a
fraud detection system, the rule profile reports comprising statistical data
regarding the performance of fraud rules" (Spec. ,r 5) ( emphasis added);
and/or (ii) addressing the problem of preventing fraudulent transactions from
occurring by "evaluat[ing] fraud rules" (Spec. ,r 3) ( emphasis added), to
determine which fraud rules are more effective (see Spec. ,r,r 3, 4).
For the reasons provided by the Examiner (see Final Act. 8-30; Ans.
1-16 (finding claims 1, 7, 11, and 16 directed to abstract ideas)), and those
above, we are not persuaded by Appellants' contentions (Appeal Br. 11-18)
that the Examiner erred in determining the claims recite limitations similar
to claims found to be patent eligible by our reviewing courts.
In view of the foregoing, we conclude claims 1, 7, 11, and 16 recite
(i) a method of evaluating fraud rule performance, which is method of
organizing human activity, a commercial/legal interaction, business relation
between people, and a mental process including making an observation
and/ or judgment performed in the human mind about potentially fraudulent
transactions. Because we conclude independent claims 1, 7, 11, and 16, as
well as their corresponding dependent claims, recite a combination of
abstract ideas which fall within the category of abstract ideas referred to as
certain methods of organizing human activity under the Revised Guidance,
we proceed to Step 2A, Prong 2 to determine whether the claims are
"directed to" the judicial exception.
Revised Guidance Step 2A, Prong 2
If a claim recites a judicial exception in Step 2A, Prong 1, we
determine whether the recited judicial exception is integrated into a practical
application of that exception in Step 2A, Prong 2 by: (a) identifying whether
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there are any additional elements recited in the claim beyond the judicial
exception( s ); and (b) evaluating those additional elements individually and
in combination to determine whether they integrate the exception into a
practical application.
The seven identified "practical application" sections of the MPEP, 3
cited in the Revised Guidance under Step 2A, Prong 2, are:
(1) MPEP § 2106.05(a) Improvements to the Functioning of a
Computer or To Any Other Technology or Technical
Field;
(2) MPEP § 2106.05(b) Particular Machine;
(3) MPEP § 2106.05(c) Particular Transformation;
(4) MPEP § 2106.05(e) Other Meaningful Limitations;
(5) MPEP § 2106.05(±) Mere Instructions To Apply An
Exception;
( 6) MPEP § 2106.05(g) Insignificant Extra-Solution Activity;
and
(7) MPEP § 2106.05(h) Field of Use and Technological
Environment.
If the recited judicial exception is integrated into a practical
application as determined under one or more of the MPEP sections cited
above, then the claim is not directed to the judicial exception, and the patent-
eligibility inquiry ends. If not, then analysis proceeds to Step 2B.
Here, Appellants' claims 1, 7, 11, and 16 recite additional
steps/elements beyond the abstract measurement of fraud rule performance
3 See MPEP § 2106.05(a}-(c), (e}-(h). Citations to the MPEP herein refer to
revision [R-08.2017].
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based on calculating rule outcome frequencies and final disposition
frequencies associated with fraud rules. These additional steps/elements
include the following components: "a fraud detection server from a client
computer" for receiving transaction criteria search parameters for previously
processed historical payment transaction; retrieving historical payment
transactions from a transaction database satisfying the search parameters;
and "display[ing] a comparison of the one or more rule outcome frequencies
with the one or more final disposition frequencies for each fraud rule of the
fraud rule profile" (see e.g., claim 1 ). Under Step 2A, Prong 2, we evaluate
these additional elements to determine whether the additional elements
integrate the abstract measurement of fraud rule performance into a practical
application.
Regarding the "fraud detection server from a client computer,"
transaction database," fraud rules database," and "processing computer,"
"non-transitory computer-readable storage medium," and "display" recited
in various ones of independent claims 1, 7, 11, and 16, the Specification
provides that the disclosed computer system/server elements encompass
general purpose hardware and software modules (see Spec. ,r,r 31, 32, 64, 67,
68, 71, 72, 86-88, 92-94, 156, 175-180; Figs. 1--4, 19) (describing and
showing the use of generic computer parts to perform generic computer
functions). And, we agree with the Examiner that the claims "recite, among
others, standard hardware and software, like processors, memory operating
system, powerful or cluster computers, server can be a large mainframe, a
minicomputer, web server wherein the server computer may be coupled to a
database and may include any hardware, software, other logic, or
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combination of the preceding for servicing the requests from one or
more client computers" (Ans. 18).
In other words, a conventional computer can be used to implement
any of the components or steps of claims 1, 7, 11, and 16. Accordingly, we
determine that the recited components merely amount to using computers as
tools to implement the abstract measurement of fraud rule performance,
which does not provide for the integration of the abstract idea into a practical
application. See MPEP § 2106.05(±) ("Use of a computer or other
machinery in its ordinary capacity for economic or other tasks ( e.g., to
receive, store, or transmit data) or simply adding a general purpose computer
or computer components after the fact to an abstract idea ( e.g., a
fundamental economic practice or mathematical equation) does not provide
significantly more.").
That is, claims 1, 7, 11, and 16 do not recite any specific functionality
of the fraud detection server and databases that shows an improvement in the
performance of a computer system for storing/retrieving/receiving
information, or a user's interaction with a computer system, as in Bascom
and DDR. See MPEP § 2106.0S(a)(I).
Although Appellants further assert "the claims correspond to an
improvement for accessing data in a transaction database and a fraud rules
database" (Appeal Br. 14), and thus "facilitate more user-friendly and
efficient retrieval and aggregation of fraud rule performance data" (id.),
claims 1, 7, 11, and 16 recite no specific functionality pertaining to a
practical improvement in the functioning of a computer (i.e., fraud detection
server, database, client computer, and/or processing computer).
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As to the disputed limitation of generating rule outcomes recited in
claims 1, 7, 11, and 16, the Examiner determines (see Ans. 7), and we agree,
that the rule outcomes are directed toward business fraud data, and therefore,
the generating process is not directed toward improvement to technology,
but rather utilizes well understood and routine functions to generate
outcomes for fraud purposes and not for technological improvement.
Finally, the last step of displaying data, recited in each of claims 1, 7,
11, and 16, is insignificant post-solution activity which neither (i) integrates
the abstract ideas into a practical application (see MPEP § 2106.05(g)
Insignificant Extra-Solution Activity); nor (ii) otherwise makes a patent
ineligible claim patent eligible (see Ans. 12 citing Flook).
For the reasons discussed above, we conclude Appellants' claims 1, 7,
11, and 16 invoke generic computer components merely as a tool in which
the fraud detection server performs a method of evaluation fraud rules to
determine final disposition frequencies of final dispositions for historical
payment transactions for fraud rules that applies the judicial exception and,
thus, the abstract idea( s) is( are) not integrated into a practical application.
Because representative claims 1, 7, 11, and 16 recite a judicial
exception (i.e., the abstract ideas of a mental process and method of
organizing human activity) that is not integrated into a practical application,
in accordance with the Revised Guidance, we conclude claims 1, 7, 11, and
16, and claims 4, 5, 10, 12-14, 17, 19, and 22-26 depending respectively
therefrom, are directed to a combination of abstract ideas under Step 2A,
Prong 1, and the eligibility analysis with regard to claim 1 proceeds to Step
2B.
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Revised Guidance Step 2B
Under our precedent, it is possible that a claim that does not
"integrate" a recited judicial exception under Step 2A, Prong 2 is
nonetheless patent eligible. For example, the claim may recite additional
elements that render the claim patent eligible even though a judicial
exception is recited in a separate claim element. 4 The Federal Circuit has
held claims eligible at the second step of the Alice/Mayo test (USPTO Step
2B) because the additional elements recited in the claims provided
"significantly more" than the recited judicial exception ( e.g., because the
additional elements were unconventional in combination). 5 Therefore, if a
claim has been determined to be directed to a judicial exception under
Revised Step 2A, we must evaluate the additional elements individually and
in combination under Step 2B to determine whether they provide an
inventive concept (i.e., whether the additional elements amount to
significantly more than the exception itself). 6
Under the Revised Guidance, we must consider in Step 2B whether an
additional element or combination of elements: (1) "Adds a specific
4 See, e.g., Diehr, 450 U.S. at 187.
5 See, e.g., Amdocs (Israel), Ltd. v. Openet Telecom, Inc., 841 F.3d 1288,
1300, 1304 (Fed. Cir. 2016); BASCOM Global Internet Services, Inc. v.
AT&T Mobility LLC, 827 F.3d 1341, 1349-52 (Fed. Cir. 2016); DDR
Holdings v. Hotels.com, 773 F.3d 1245, 1257-59 (Fed. Cir. 2014).
6 We note the patent eligibility inquiry may contain underlying issues of fact.
Mortg. Grader, Inc. v. First Choice Loan Servs. Inc., 811 F.3d 1314, 1325
(Fed. Cir. 2016). In particular, "[t]he question of whether a claim element or
combination of elements is well-understood, routine and conventional to a
skilled artisan in the relevant field is a question of fact." Berkheimer v. HP
Inc., 881 F.3d 1360, 1368 (Fed. Cir. 2018).
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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,
III.B. 7
In the Step 2B analysis, an additional element ( or combination of
elements) is not well-understood, routine or conventional unless the
examiner finds an evidentiary basis, and expressly supports a rejection in
writing with one or more of the following:
1. A citation to an express statement in the specification or to
a statement made by an applicant during prosecution that
demonstrates the well-understood, routine, conventional nature
of the additional element( s).
2. A citation to one or more of the court decisions discussed
in MPEP § 2106.05( d)(II) as noting the well-understood, routine,
conventional nature of the additional element( s).
3. A citation to a publication that demonstrates the well-
understood, routine, conventional nature of the additional
element( s ).
7 In accordance with existing Step 2B guidance, an Examiner's conclusion
that an additional element ( or combination of elements) is well understood,
routine, conventional activity must be supported with a factual
determination. For more information concerning evaluation of well-
understood, routine, conventional activity, see MPEP § 2106.05( d), as
modified by the USPTO Berkheimer Memorandum (USPTO Commissioner
for Patents Memorandum dated Apr. 9, 2018, "Changes in Examination
Procedure Pertaining to Subject Matter Eligibility, Recent Subject Matter
Eligibility Decision (Berkheimer v. HP, Inc.)" (hereinafter "Berkheimer
Memo").
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4. A statement that the examiner is taking official notice of
the well-understood, routine, conventional nature of the
additional element( s ).
See Berkheimer Memo.
The analysis in Step 2B further determines whether an additional
element or combination of elements:
(a) 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
(b) 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.
Revised Guidance, and see Berkheimer Memo.
If the Examiner or the Board determines under Step 2B that the
element ( or combination of elements) amounts to significantly more than the
exception itself, the claim is eligible, thereby concluding the eligibility
analysis.
However, if a determination is made that the element and combination
of elements does not amount to significantly more than the exception itself,
the claim is ineligible under Step 2B, and the claim should be rejected for
lack of subject matter eligibility.
In the instant case before us, having concluded Appellants' claims are
directed to a combination of abstract ideas under Step 2A, we next address
whether the claims add significantly more to the abstract idea under Step 2B.
As directed by our reviewing court, we search for an "'inventive concept'
sufficient to 'transform the nature of the claim into a patent-eligible
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application."' McRO, Inc. v. Bandai Namco Games Am. Inc., 837 F.3d
1299, 1312 (Fed. Cir. 2016) (quoting Alice, 573 U.S. at217). The
implementation of the abstract idea involved must be "more than
performance of 'well-understood, routine, [and] conventional activities
previously known to the industry."' Content Extraction, 776 F.3d at 1347-
48 (alteration in original) ( quoting Alice, 573 U.S. at 225). The "inventive
concept" "must be significantly more than the abstract idea itself, and cannot
simply be an instruction to implement or apply the abstract idea on a
computer." Bascom, 827 F.3d at 1349 ( citation omitted).
Here, the Examiner determines that claims 1, 7, 11, and 16 do not add
significantly more to the abstract idea, and the fraud detection server, client
computer, processing computer, databases, and/or display are generic
technology which only serve to perform generic computer functions (see
e.g., Final Act. 11-13 discussing claim 1; see also Ans. 16-19). The
Examiner determines that "the claims in the instant application do not
constitute significantly more also because they are simply an attempt to
apply the well-known, routine and conventional steps to a conventional, not
a particular technological environment (see Enfzsh (2016)), specifically: a
computer system that encompasses general purposes hardware and software
modules, as disclosed in the application specification in FIG. 1-4 and [0031-
0032], which recite, among others, standard hardware and software, like
processors, memory operating system, powerful or cluster computers, server
can be a large mainframe, a minicomputer, web server wherein the server
computer may be coupled to a database and may include any hardware,
software, other logic, or combination of the preceding for servicing the
requests from one or more client computers" (Ans. 18). We agree, and
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add that our review of the Specification leads us to the same conclusion (see
Spec.,,31,32,64,67,68, 71, 72, 86-88,92-94, 156, 175-180;Figs. 1--4,
19) ( describing and showing the use of generic computer parts to perform
generic computer functions).
Thus, Appellants' Specification only describes well-understood,
routine, conventional computer components (e.g., server, processor,
memory) in a manner that indicates the components and the functions they
perform were well known in the art. See Hybritech Inc., 802 F .2d at 13 84
( explaining that "a patent need not teach, and preferably omits, what is well
known in the art"); see also Intellectual Ventures I LLC, 850 F.3d at 1331
("The claimed mobile interface is so lacking in implementation details that it
amounts to merely a generic component (software, hardware, or firmware)
that permits the performance of the abstract idea, i.e., to retrieve the user-
specific resources."). Such conventional computer components and
operations "do not alone transform an otherwise abstract idea into patent-
eligible subject matter." FairWarning IP, LLC v. Iatric Sys., Inc., 839 F.3d
1089, 1096 (Fed. Cir. 2016) (citing DDR Holdings, 773 F.3d at 1256).
Appellants contend (see Appeal Br. 19-20; Reply Br. 10) the claims
add specific limitations other than well-understood, routine, and
conventional activities by (i) retrieving historical payment transactions and
generating rule outcomes; and (ii) reciting a specific way of measuring fraud
rule performance. We are not persuaded of Examiner error.
The Federal Circuit, in accordance with Alice, has "repeatedly
recognized the absence of a genuine dispute as to eligibility" where claims
have been defended as involving an inventive concept based "merely on the
idea of using existing computers or the Internet to carry out conventional
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processes, with no alteration of computer functionality." Berkheimer v. HP
Inc., 890 F.3d 1369, 1373 (Fed. Cir. 2018) (Moore, J., concurring). As seen
from the discussion above, Appellants' claims 1, 7, 11, and 16 recite nothing
more than the implementation of a combination of abstract ideas using
existing computers/servers and components with no alteration of computer
functionality.
Appellants' contentions ( Appeal Br. 20-21) that "claims 1, 7, 11, and
16 are unconventional, as evidenced by their novelty and nonobviousness
over the prior art" (Appeal Br. 20), are not persuasive as to patent eligibility.
"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."
Diehr, 450 U.S. at 188-89.
And, with regard to Appellants' contention (Appeal Br. 16) that the
claimed invention is similar to the claims found patent eligible in Ex Parte
Scott, Appeal No. 2012-009834 (PTAB March 12, 2015), concerning the
appearance of information on a display, we agree with the Examiner that this
PTAB decision does not represent office policy (Ans. 10) as it is non-
precedential, and in any event, differs from the facts of the case before us. 8
For these reasons, we determine claims 1, 7, 11, and 16 do not recite
an inventive concept because it simply appends well-understood, routine,
8 See also Trading Technologies International, Inc. v. !BG LLC, No. 2017-
2323 (Fed. Cir. April 30) 2019) cited supra pp. 14----15 (holding claims were
directed to business problem and unpatentable abstract idea of calculating
and displaying information that "is nothing more than 'mere automation of
manual processes using computers''').
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conventional activities previously known to the industry, specified at a high
level of generality, to the abstract idea(s).
Summary
Therefore, under the US PTO' s Revised Patent Eligibility Guidance,
informed by our governing case law concerning 35 U.S.C. § 101, Appellants
have not shown the Examiner erred in concluding claims 1, 7, 11, and 16, as
well as their corresponding dependent claims, are directed to a judicial
exception, i.e., an abstract idea or combination of abstract ideas, without
significantly more, and thus are patent-ineligible under§ 101. In view of the
foregoing, we sustain the Examiner's§ 101 rejection of claims 1, 4, 5, 7, 10-
12, 14, 16, 17, 19, and 22-26 as being directed to patent-ineligible subject
matter.
Anticipation and Obviousness
We have reviewed the Examiner's rejections (Final Act. 31--47) in
light of Appellants' contentions in the Appeal Brief ( Appeal Br. 21-24) and
Reply Brief (Reply Br. 11-12) that the Examiner has erred, and the
Examiner's response to Appellants' arguments (Ans. 19-27). We concur
with Appellants' contentions (Appeal Br. 21-24; Reply Br. 11-12) that the
Examiner erred in finding claims 1, 4, 5, 7, 10-12, 14, 16, 17, 19, 22, and
24--26 anticipated by Wright, and claim 23 obvious over the combination of
Wright and Emde, because Wright fails to disclose limitation [A], including
"generating, by the fraud detection server, rule outcomes by applying the
plurality of fraud rules to the plurality of historical payment transactions," as
recited in independent method claim 1, and as commensurately recited in
remaining independent claims 7, 11, and 16.
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"A claim is anticipated only if each and every element as set forth in
the claim is found, either expressly or inherently described, in a single prior
art reference." Verdegaal Bros. v. Union Oil Co. of California, 814 F.2d
628, 631 (Fed. Cir. 1987). To establish anticipation, every element and
limitation of the claimed invention must be found in a single prior art
reference, arranged as in the claim. Karsten Mfg. Corp. v. Cleveland Golf
Co., 242 F.3d 1376, 1383 (Fed. Cir. 2001). "[A]bsence from the reference
of any claimed element negates anticipation." Kloster Speedsteel AB v.
Crucible, Inc., 793 F.2d 1565, 1571 (Fed. Cir. 1986).
In addition, the Examiner is required to provide Appellants reasonable
notice as to the basis of a rejection. The notice requirement is set forth by
35 U.S.C. § 132:
[T]he PTO carries its procedural burden of establishing a prima
facie case when its rejection satisfies 35 U.S.C. § 132, in
"notify[ing] the applicant . .. [by] stating the reasons for [its]
rejection, or objection or requirement, together with such
information and references as may be useful in judging of the
propriety of continuing the prosecution of [the] application." 3 5
U.S.C. § 132. That section "is violated when a rejection is so
uninformative that it prevents the applicant from recognizing and
seeking to counter the grounds for rejection." Chester v. Miller,
906 F.2d 1574, 1578 (Fed. Cir. 1990).
See In re Jung, 637 F.3d 1356, 1362 (Fed. Cir. 2011).
The Examiner has the initial burden to set forth the basis for any
rejection so as to put the patent applicant on notice of the reasons why the
applicant is not entitled to a patent on the claim scope that he seeks - the so-
called ''primafacie case." In re Oetiker, 977 F.2d 1443, 1445 (Fed. Cir.
1992); In re Piasecki, 745 F.2d 1468, 1472 (Fed. Cir. 1984) (the initial
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burden of proof is on the US PTO "to produce the factual basis for its
rejection of an application under sections 102 and 103") (quoting In re
Warner, 379 F.2d 1011, 1016 (CCPA 1967)).
In the instant case before us on appeal, the Examiner has not
sufficiently mapped the teachings of Wright to the limitations of the claims,
and has neither (i) met the required burden of demonstrating a prima facie
case of anticipation; nor (ii) properly put Appellants on notice as to the basis
of the rejection. Specifically, in rejecting claims 1, 7, 11, and 16, the
Examiner cites to large portions of Wright ( e.g., Figs. 5, 7-8, 1 OA, 1 OB;
,,14-17,37,58---60,66,84, 86-91,93-97, 100-124, 127-129, 133-149,
152, 159-245, 251, 260-262) as teaching disputed claim limitation [A] of
claim 1, and the commensurate limitations of claims 7, 11, and 16 (Final
Act. 32, 40, 43, 46; Ans. 19-26). The citation to more than 100 paragraphs
for a single limitation is not specific enough to put Appellants on notice as to
how/why limitation A is found to be met by Wright.
In any event, in view of the requirement that an anticipatory reference
disclose all of the claimed limitations arranged in the same way as recited in
the claims ( discussed supra), we find that Wright fails to disclose a server
that generates or is generating, "rule outcomes by applying the plurality of
fraud rules to the plurality of historical payment transactions", as recited in
independent claims 1, 7, 11, and 16. We agree with Appellants' contentions
(Appeal Br. 22-23; Reply Br. 11-12) that the fraud risk models of Wright
are not applied to historical payment transactions, as set forth in limitation
A. We discuss Wright's descriptions of how historical payment transactions
are used below.
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Notably, Wright describes applying fraud risk models to ongoing real-
world transaction data (see ,r 110), and performing analysis of a current
transaction profile against profiles of known fraudulent transactions for
generating a risk score for transaction disposition (see ,r 152). Wright also
describes a fraud screening and risk scoring system 1007 that interacts with
a worldwide transaction history database 1008 that contains records of a
large plurality of past, completed electronic commerce transactions, and
performs fraud screening by consulting the transaction history database 1008
and returning a corresponding risk score to the merchant (see ,r 157).
Wright describes history information 1018 as including past
transactions involving the same merchant and customer that the system has
processed (see ,r 162), and then referencing past transactions for comparison
and history testing (see ,r 256). History testing involves verifying that
current transaction information 1012 is consistent with previous transactions
associated with an individual (see ,r 256). Transactions associated with a
particular Internet identity/user ( e.g., unique identifiers such as email
address, credit card BIN value, hardware device ID, or shipping address) for
a current transaction are compared (Fig. 1 OB, comparison operation 1020) to
history information 1018 of historic transactions (see ,r,r 261-262) stored in
worldwide transaction history database 1008 (see ,r 157). If any of the
records returned from the database is for a prior order on a fraud list, the
comparison operation 1020 stops to prevent unnecessary processing since
such orders processed using the comparison operation 1020 are certain to
end in a negative result (see ,r 262).
Wright uses historical transactions and information stored in a
database 322 for determining if fraud exists in a particular transaction (see
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,r,r 59---62), and produces a graph (see Fig. 5) illustrating two frequency
distributions of good and bad transactions, and corresponding risk scores.
As described above, Wright (see generally ,r,r 110, 152, 157, 162, 256-262)
merely uses historical transactions when determining if fraud exists in
ongoing or current transactions. Wright does not apply fraud rules to the
plurality of historical payment transactions in the same way as set forth in
independent claims 1, 7, 11, and 16, and cannot anticipate claims 1, 7, 11,
and 16. See Karsten Mfg. Corp., 242 F.3d at 1383 (anticipation requires
every element and limitation of the claimed invention must be found in a
single prior art reference, arranged as in the claim); see also Kloster
Speedsteel AB, 793 F .2d at 1571 ("[ A ]bsence from the reference of any
claimed element negates anticipation.").
We are, therefore, constrained by the record to find the Examiner
erred in rejecting independent claims 1, 7, 11, and 16, as well as claims 4, 5,
10, 12, 14, 17, 19, 22, and 24--26 (and which depend respectively from
claims 1, 7, 11, and 16 and thus recite commensurate limitations) as being
anticipated by Wright.
Appellants contend that the Examiner erred in rejecting claim 23 as
being unpatentable over the combination of Wright and Emde for similar
reasons as provided with respect to the anticipation rejection discussed
above, and because Emde fails to cure the deficiencies of Wright (see
Appeal Br. 23; Reply Br. 13). For similar reasons as provided for claim 1,
and based on the dependency of claim 1, we do not sustain the rejection of
dependent claim 23.
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CONCLUSIONS
(1) Appellants have not shown the Examiner erred in rejecting claims
1, 4, 5, 7, 10-12, 14, 16, 17, 19, and 22-26 under 35 U.S.C. § 101.
(2) The Examiner erred in rejecting claims 1, 4, 5, 7, 10-12, 14, 16,
17, 19, 22, and 24--26 under 35 U.S.C. § 102(a)(2) as being anticipated by
Wright, and as a result also erred in rejecting claim 23 ( depending from
claims 1 and 22) under 35 U.S.C. § 103(a) as being unpatentable over the
combination of Wright and Emde.
DECISION
For the above reasons, the Examiner's decision rejecting claims 1, 4,
5, 7, 10-12, 14, 16, 17, 19, and 22-26 under 35 U.S.C. § 101 as being
directed to patent-ineligible subject matter is affirmed. And, the Examiner's
anticipation and obviousness rejections of claims 1, 4, 5, 7, 10-12, 14, 16,
17, 19, and 22-26 are reversed.
Therefore, we affirm the Examiner's decision to reject claims 1, 4, 5,
7, 10-12, 14, 16, 17, 19, and 22-26, because at least one ground of rejection
has been affirmed for each claim. See 37 C.F.R. § 4I.50(a)(l) ("The
affirmance of the rejection of a claim on any of the grounds specified
constitutes a general affirmance of the decision of the examiner on that
claim, except as to any ground specifically reversed").
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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). See 37 C.F.R.
§ 41.50(±).
AFFIRMED
34