Justin Xavier. Howe

Patent Trials and Appeals Board

Dec 27, 2019

14521759 - (D) (P.T.A.B. Dec. 27, 2019)

UNITED STATES PATENT AND TRADEMARK OFFICE
UNITED STATES DEPARTMENT OF COMMERCE
United States Patent and Trademark Office
Address: COMMISSIONER FOR PATENTS
P.O. Box 1450
Alexandria, Virginia 22313-1450
www.uspto.gov
APPLICATION NO. FILING DATE FIRST NAMED INVENTOR ATTORNEY DOCKET NO. CONFIRMATION NO.
14/521,759 10/23/2014 Justin Xavier Howe P01742-US-
UTIL (M01.314)
7268
125619 7590 12/27/2019
Mastercard International Incorporated
c/o Buckley, Maschoff & Talwalkar LLC
50 Locust Avenue
New Canaan, CT 06840
EXAMINER
MACASIANO, MARILYN G
ART UNIT PAPER NUMBER
3688
NOTIFICATION DATE DELIVERY MODE
12/27/2019 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):
colabella@bmtpatent.com
martin@bmtpatent.com
szpara@bmtpatent.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________

Ex parte JUSTIN ZAVIER HOWE
____________

Appeal 2018-006624
Application 14/521,759
Technology Center 3600
____________

Before CAROLYN D. THOMAS, MICHAEL J. STRAUSS, and
NABEEL U. KHAN, Administrative Patent Judges.

THOMAS, Administrative Patent Judge.

DECISION ON APPEAL

Pursuant to 35 U.S.C. § 134(a), Appellant1 appeals from the
Examiner’s decision to reject claims 2–8, 10–16, and 18–20. We have
jurisdiction over the appeal under 35 U.S.C. § 6(b).
We AFFIRM.

1 We use the word “Appellant” to refer to “applicant” as defined in 37
C.F.R. § 1.42. Appellant identifies the real party in interest as MasterCard
International Incorporated. Appeal Br. 2.
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The present invention relates generally to receiving personal
characteristics data for a population of holders of payment card accounts.
See Abstr.

Independent claim 2, reproduced below, is representative of the
appealed claims:
2. A method comprising:
receiving, in a computer, personal characteristic data for
a population of holders of payment card accounts;
receiving, in the computer, payment card account
transaction data associated with a merchant; and
analyzing, by the computer, said personal characteristic
data and said payment card account transaction data to generate a
time-based customer population profile for said merchant;
wherein said time-based customer population profile
indicates typical personal characteristics of customers of said
merchant by time of day and/or by day of week and/or by day of year
and/or on holidays and/or based on phases of the moon and/or by day
of month according to times when said customers are physically
present at the merchant’s premises, said time-based customer
population profile being a profile of varying characteristics of the
customer population physically present from time to time at the
merchant’s premises.

Appellant appeals the following rejections:
R1. Claims 2–8, 10–16, and 18–20 are rejected under 35 U.S.C.
§ 101 because the claimed invention is directed to patent-ineligible subject
matter. Final Act. 2–6.; and
R2. Claims 2–8, 10–16, and 18–20 are rejected under 35 U.S.C.
§ 103(a) as being unpatentable over Strock (US 2004/0122736 A1, June 24,
2004) and Juang (US 8,335,720 B2, Dec. 18, 2012). Final Act. 6–12.
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We review the appealed rejections for error based upon the issues
identified by Appellant, and in light of the arguments and evidence produced
thereon. Ex parte Frye, 94 USPQ2d 1072, 1075 (BPAI 2010) (precedential).

ANALYSIS
Rejection under § 101
An invention is patent-eligible if it claims a “new and useful process,
machine, manufacture, or composition of matter.” 35 U.S.C. § 101.
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
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. Kappos, 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,
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594–95 (1978)); and mental processes (Gottschalk v. 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:
(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 2, and similarly, apparatus
claim 18 and non-transitory medium claim 10, the Examiner determines that
the claims are directed to “a cardholder [] targeting and merchant profiling
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using personal characteristic data” (Final Act. 3), and that “[t]hese concepts
relate to ‘An Idea Of Itself’ as well as ‘Certain Methods of Organizing
Human Activity’” (id. at 4), which are types of abstract idea.
As for the Examiner’s enumerated “an idea of itself, it is sufficient for
the purposes of the present appeal that the claimed concepts reasonably can
be characterized as falling within the recognized category of mental
processes.” See, e.g., MPEP § 2106.04(a)(2)(III):
The courts have used the phrase “an idea ‘of itself’” to describe
an idea standing alone such as an uninstantiated concept, plan
or scheme, as well as a mental process (thinking) that “can be
performed in the human mind, or by a human using a pen and
paper.” CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d
1366, 1372 (Fed. Cir. 2011).
For at least the following reasons, we are persuaded that
representative claim 2 recites plural abstract ideas, i.e., mental processes and
certain methods of organizing human activity.
Specifically, claim 2 recites at least the following limitations:
(1) “receiving . . . personal characteristic data for a population of holders,”
(2) “receiving . . . transaction data associated with a merchant,” and
(3) “analyzing . . . said personal characteristic data and . . . transaction data
to generate a time-based customer population profile for said merchant.”
Claim 2. These limitations, under their broadest reasonable interpretation,
recite both mental processes and commercial interactions akin to marketing
activities.
For example, these limitations encompass acts people can perform
using their minds or pen and paper because people can perform the
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“receiving” steps by simply looking at the recited data and recognizing
personal characteristics and merchant data. People can also perform the
“analyzing” step by looking at all data and observing a time when particular
transactions occurred.
As for the claims reciting commercial interactions, Appellant’s
Specification supports this interpretation by disclosing:
In general, and for the purpose of introducing concepts of
embodiments of the present invention, a data set may be received
containing data indicative of transactions routed in a payment card
network. The data set may be filtered to produce a narrower data set
that contains only transactions for a particular merchant. Data may
also be obtained that indicates personal characteristics of cardholders
who participate in the payment card system. Based on the transaction
data for the merchant, including the timing of the transactions and the
account numbers contained in the transaction data, and also based on
the personal characteristics of the corresponding cardholders, an
analysis is performed to build a time-based customer population
profile for the merchant. The profile may indicate the prevailing
personal characteristics of the merchant’s customers according to the
times when the customers transact with the merchant.
Spec. 2:7–18. In other words, the claimed invention examines commercial
interactions that certain cardholders are performing during various times.
Appellant challenges the Examiner’s determinations by contending
that the pending claims “are not such as can be practiced ‘entirely in the
human mind.’ Rather, the quantities of data involved are so large, and the
analytical processes are so complex and processing-intensive, that such
practices are invariably performed by electronic computer systems.” Appeal
Br. 8.
In response, the Examiner determines, and we agree, “SmartGene is
applicable in that it identifies at least a portion of claim 2 as being directed
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to an abstract idea.” Ans. 4. In other words, the entirety of claim 2 need not
be practically performed mentally, as it is enough that only portions of claim
2 meet this criteria. Furthermore, claim 2 is not limited to very large
quantities of data, as argued by Appellant, but could include a small
population. In any case, even assuming arguendo that the entirety of claim 2
could not be practically performed mentally, Appellant fails to dispute that
the claims recite the other highlighted abstract concept, i.e., certain methods
of organizing human activity, e.g., commercial interactions such as
marketing activities.
Furthermore, we agree with the Examiner that the dependent claims
also recite the aforementioned abstract concepts. See Ans. 5. The dependent
claims contain only limitations that recite the identified abstract idea, and do
not create any additional elements beyond this abstract idea. Therefore, we
disagree with the argument that the Office Action fails to address the
dependent claims.
Therefore, for at least the aforementioned reasons, we agree with the
Examiner that representative claim 2 recites an abstract idea, which we
conclude are “mental processes” and “certain method of organizing human
activity.”
Step 2A—Prong 2 (integration into Practical Application)2

2 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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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 Appellant’s 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, Appellant’s claimed additional elements
(e.g., “a computer,” “a processor,” and “a memory”) 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).
Here, Appellant does 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 arguably innovative
technique of the appealed claims is inextricably a part of the abstract idea of
cardholder targeting and merchant profiling. 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 analyzing
various information/data. See Spec. 2:27-29; 4:1–7. Therefore, the claims
are directed not to improvement in computer capabilities, but to the results
of applying an abstract idea.
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The claimed “receiving” steps do not integrate the judicial exceptions
described above into a patent-eligible practical application. For example,
receiving personal characteristic data and transaction data is no more than
pre-solution activity.
These pre-solution steps—even when performed over a computer
network—are insufficient to integrate the judicially excepted steps into a
practical application. See Alice, 573 U.S. at 224 (“use of a computer to
create electronic records, track multiple transactions, and issue simultaneous
instructions” is not an inventive concept).
Furthermore, although the claimed process generates a time-based
customer population profile, the claimed process fails to improve the
functioning of the computer, the processor, or the memory. Rather, the
computer, the processor, and the memory merely link the underlying abstract
idea (i.e., the mental processes and/or commercial interactions) to a
particular technological environment, i.e., targeted marketing campaigns.
That is, as stated in the Specification, the claimed process simply
“recognized additional opportunities for targeted marketing techniques based
on analysis of payment card account transaction data.” Spec. 1:10–12.
Thus, the claimed process uses conventional computers and computer
networks to automate tasks that would have otherwise been performed by a
marketing personnel. Such claims are not patent eligible. See OIP Techs.,
Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1363 (Fed. Cir. 2015) (“relying on
a computer to perform routine tasks more quickly or more accurately is
insufficient to render a claim patent eligible”).
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For at least the reason noted supra, we determine that claim 2
(1) recites a judicial exception and (2) does not integrate that exception into
a practical application. Thus, representative claim 2 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).
Appellant contends “the Examiner has provided no evidence of
considering specific aspects of claim 2, including the exact nature of the
time-based population profile” (Appeal Br. 9) and “the process of claim 2
allows a merchant to know what kinds of individuals are physically present
in the merchant’s store at particular times.” Id. at 10. Appellant emphasizes
that “[t]his point turns on the novel, unobvious features of claim 2 . . . [and]
the Examiner could not properly conclude that claim 2 relates to ‘well-
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understood, routine, conventional activity.’” Id. Appellant makes a similar
argument for claim 4. Id. at 11.
As evidence, the Examiner points out that the present invention is
merely receiving and analyzing data, i.e., obtains and compares intangible
data. Ans. 4 (citing CyberSoure). Additionally, in Cyberfone, the Court
held that “using categories to organize, store, and transmit information is
well-established,” and “the well-known concept of categorical data storage,
i.e., the idea of collecting information in classified form, then separating and
transmitting that information according to its classification, is an abstract
idea that is not patent-eligible.” Cyberfone Sys., LLC v. CNN Interactive
Grp., Inc., 558 Fed. App’x. 988, 992 (Fed. Cir. 2014).
Here, as in Cyberfone, Appellant classifies personal characteristic
information into time-based categories to better organize marketing efforts.
Furthermore, the Examiner points out that “generic computer functions
routinely used in computer applications” are being applied here. See Ans. 5.
Such an analysis is a factual determination. See Berkheimer v. HP
Inc., 881 F.3d 1360, 1369 (Fed. Cir. 2018) (“Whether something is well-
understood, routine, and conventional to a skilled artisan at the time of the
patent is a factual determination.”). We find the Examiner’s noting of
generic nature of the component parts recited in the claims provides
sufficient evidence of a generic computer system used to implement the
abstraction. See Intellectual Ventures I LLC v. Capital One Fin. Corp., 850
F.3d 1332, 1342 (Fed. Cir. 2017) (explaining that “[o]ur law demands more”
than claim language that “provides only a result-oriented solution, with
insufficient detail for how a computer accomplishes it”).
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We find no element or combination of elements recited in Appellant’s
claim 2 that contains any “inventive concept” or adds anything “significantly
more” to transform the abstract concept into a patent-eligible application.
Also, Appellant has not adequately explained how claim 2 is performed such
that it is not a routine and conventional function of a generic computer.
Furthermore, we note that 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
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.”).
Because Appellant’s independent claim 2 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
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of the claims 1–20 under 35 U.S.C. § 101 as being directed to non-statutory
subject matter in light of Alice, its’ progeny, and the Revised Guidance.
Rejection under § 103(a)
Appellant contends that “Juang does not consider or pinpoint the
customers being present at the premises of a particular merchant.” Appeal
Br. 13.
Although we agree with the Examiner that Juang teaches customizing
discounts based on cardholder shopping patterns, including travel patterns
(see Ans. 5–6, citing Juang col. 10:59 to 11:10), we agree with Appellant
that such teachings fail to illustrate “customers are physically present at the
merchant’s premises,” as required by claim 2.
For instance, Juang merely discloses:
Using the consumer groups identified by the consumer
algorithm, the merchant can determine which consumer groups should
be targeted. In a practical example, of the concentric circles
algorithm, a classical music store merchant may need to target
customers for weekday morning low-demands periods. . . . Of that
group, only 5,000 cardmembers shop in the same area as the classical
music store. Of that group, only 500 cardmembers regularly shop on
weekday mornings.
Col. 10:59 to col. 11:5. In other words, Juang, at best, teaches how to target
customers during low-demand periods at a particular merchant, i.e., by
targeting customers “in the same area” as the merchant in an effort to get
them to visit the merchant premises, as opposed to indicating which
customers are actually physically present at the merchant’s premises during
these times.
Thus, we disagree with the Examiner’s finding that Juang teaches
customers are physically present at the merchant’s premises, as recited in
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each of the independent claims. The Examiner also has not found that
Strock teaches this feature. Since we agree with at least one of the
arguments advanced by Appellant, we need not reach the merits of
Appellant’s other arguments. Accordingly, we will not sustain the
Examiner’s obviousness rejection of claims 2–8, 10–16, and 18–20.

CONCLUSION
In summary:
Claims
Rejected
35 U.S.C. § Reference(s)/Basis Affirmed Reversed
2–8, 10–16,
18–20
101 Eligibility 2–8, 10–
16, 18–20

2–8, 10–16,
18–20
103 Strock, Juang 2–8, 10–
16, 18–20
Overall
Outcome
2–8, 10–
16, 18–20

No period for taking any subsequent action in connection with this
appeal may be extended under 37 C.F.R. § 1.136(a).

AFFIRMED