Brian Tully et al.

Patent Trials and Appeals Board

Aug 29, 2019

14089933 - (D) (P.T.A.B. Aug. 29, 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.
14/089,933 11/26/2013 Brian Tully TRCP.P0026US/1000202174 1087
29053 7590 08/29/2019
NORTON ROSE FULBRIGHT US LLP
2200 ROSS AVENUE
SUITE 3600
DALLAS, TX 75201-7932
EXAMINER
BRIDGES, CHRISTOPHER
ART UNIT PAPER NUMBER
3695
NOTIFICATION DATE DELIVERY MODE
08/29/2019 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):
doipdocket@nortonrosefulbright.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
____________________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________________

Ex parte BRIAN TULLY, PABLO PEREZ PEREZ,
CARL PHILIP BRANDT,
ENRICO VALENDIANO GALVEZ, and VIKRAM PUROHIT
____________________

Appeal 2018-0074171
Application 14/089,933
Technology Center 3600
____________________

Before DEBRA K. STEPHENS, HUNG H. BUI, and ADAM J. PYONIN,
Administrative Patent Judges.

PYONIN, Administrative Patent Judge.

DECISION ON APPEAL
This is a decision on appeal under 35 U.S.C. § 134(a). We have
jurisdiction under 35 U.S.C. § 6(b).
We AFFIRM.

1 Thomson Reuters Global Resources Unlimited Company is listed as the
real party in interest. App. Br. 2.
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STATEMENT OF THE CASE
Introduction
The Application relates to “accurately account[ing] for the transfer
prices associated with intra-entity sales when determining net income and
other like accounting metrics in order to avoid underpayment of taxes, as
well as other penalties.” Spec. ¶ 6. Claims 1–5, 7, 8, 10, and 12–20 are
pending; of these, claims 1, 13, and 17 are independent. App. Br. 23–29.
Claim 1 is reproduced below for reference (with added emphasis and
bracketed lettering):
1. A method, comprising:
[a] gathering, from a first source, information associated
with an entity, wherein the information includes a plurality of
categories and respective data entries corresponding to each
category of the plurality of categories, the respective data entries
including at least one metric quantifying an attribute of a product,
wherein the first source comprises a database;
[b] gathering additional information associated with the
entity from a second source different than the first source;
[c] analyzing aspects of the product processed by a
plurality of divisions of an entity, located in different geographic
locations, during an intra-entity transaction associated with the
product, the aspects comprising the at least one metric, wherein
the analyzing comprises determining that the respective data
entries of one or more categories of the plurality of categories in
the information gathered from the first source correspond to
respective data entries of the one or more categories in the
additional information, gathered from the second source;
[d] generating, with a processor, a supply chain map,
based on the information and in response to the determining that
the respective data entries of one or more categories of the
plurality of categories in the information gathered from the first
source correspond to respective data entries of the one or more
categories in the additional information, gathered from the
second source, the supply chain map comprising an empirical
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model representing the intra-entity transaction and identifying
the product wherein the supply chain map identifies a sales
division, a manufacturing division, and a supplier division of the
plurality of divisions of the entity;
[e] identifying a plurality of functions performed by at
least one of the sales division, the manufacturing division, or the
supplier division of the plurality of divisions during the
intra-entity transaction;
[f] generating, with the processor and for the supply chain
map, a respective allocation relationship specific to each function
of the plurality of functions, each respective allocation
relationship being generated based at least partly on an operating
parameter of the at least one division and the aspects of the
product, at least one of the allocation relationships comprising a
percentage, a ratio, an algorithm, or an equation;
[g] determining, with the processor and for each function,
an intra-entity sales expense using the respective allocation
relationship associated with each function; and
[h] providing, to the entity, an indication of net income and
target earnings for the at least one division,
[i] wherein the net income is provided for each function,
and wherein the net income is determined based on the respective
intra-entity sales expense associated with each function.

References and Rejections
The prior art relied upon by the Examiner in rejecting the claims on
appeal is:
Morgan
Hayashi
Sarthi
US 5,799,286
US 7,302,409 B2
US 7,627,493 B1
Aug. 25, 1998
Nov. 27, 2007
Dec. 1, 2009
Curtis
Natarajan
US 2014/0067632 A1
US 2014/0095373 A1
Mar. 6, 2014
Apr. 3, 2014

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Claims 1–5, 7, 8, 10, and 12–20 stand rejected under 35 U.S.C. § 101
as being patent ineligible. Final Act. 2.
Claims 1–4, 7, 8, 12–14, and 16–20 stand rejected under 35 U.S.C.
§ 103(a) as being unpatentable over Sarthi, Morgan, Natarajan, and Hayashi.
Final Act. 11.
Claims 5, 10, and 15 stand rejected under 35 U.S.C. § 103(a) as being
unpatentable over Sarthi, Morgan, Natarajan, Hayashi, and Curtis. Final
Act. 21.

ANALYSIS
We have reviewed the Examiner’s rejections in light of Appellants’
arguments. Arguments Appellants could have made but chose not to make
are deemed to be waived. See 37 C.F.R. § 41.37(c)(1)(iv). We discuss each
of the statutory grounds of rejection, in turn.

A. 35 U.S.C. § 101
The Examiner determines the claims are patent ineligible under
35 U.S.C. § 101, because “there are no meaningful limitations in the claims
that transform the [recited] judicial exception into a patent eligible
application such that the claims amount to significantly more than the
judicial exception itself.” Final Act. 10; see also Alice Corp. v. CLS Bank
Int’l, 573 U.S. 208, 217 (2014) (describing the two-step framework “for
distinguishing patents that claim laws of nature, natural phenomena, and
abstract ideas from those that claim patent-eligible applications of those
concepts”).
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After the docketing of this Appeal, the USPTO published revised
guidance on the application of § 101. See USPTO’s 2019 Revised Patent
Subject Matter Eligibility Guidance, 84 Fed. Reg. 50 (Jan. 7, 2019)
(“Revised Guidance”). Under the Revised Guidance, 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)).
Only if a claim (1) recites a judicial exception and (2) does not integrate that
exception into a practical application, does the Office then look to whether
the claim:
(3) adds a specific limitation beyond the judicial exception that
are not “well-understood, routine, conventional” in the field (see
MPEP § 2106.05(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.
See Revised Guidance.
We are not persuaded the Examiner’s rejection is in error. We add the
following primarily for emphasis and clarification with respect to the
Revised Guidance.

I. Step 2A, Prong One
We are not persuaded the Examiner errs in determining claim 1 recites
an abstract concept. See Final Act. 3–7. Claim 1 is a method claim that
recites limitations [a], [b], [c], [d], [e], [f], [g], [h], and [i] as shown above.
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These limitations are steps of gathering and calculating data in order to
provide a specific financial analysis (the recited “indication of net income
and target earnings” based on, inter alia, “the respective intra-entity sales
expense”). These are steps of “mitigating risk,” “agreements in the form of
contracts; legal obligations; . . . business relations,” and “following rules or
instructions.” Revised Guidance, 84 Fed. Reg. at 52; see also e.g., Spec. ¶ 4
(“governments require that the entity be able to adequately justify the
assigned transfer price using GAAP”), ¶ 16 (“such sources of information
108 may include human persons or employee(s) 116 of the entity 110, and
information 108 may be gathered by the users 104 via in-person
communication with such employees 116.”). Pursuant to the Revised
Guidance, these limitations thus recite “fundamental economic principles or
practices,” “commercial or legal interactions,” and “managing . . .
interactions between people” which are the judicial exception of “[c]ertain
methods of organizing human activity.” Revised Guidance, 84 Fed. Reg. at
52.
Other than the recited “processor,” claim 1 limitations [a], [b], [c], [d],
[e], [f], [g], and [i] are also steps of “observation, evaluation, judgment,
opinion,” and thus are defined by the Revised Guidance as reciting the
judicial exception of “[m]ental processes.” Id.; see also Intellectual
Ventures I LLC v. Symantec Corp., 838 F.3d 1307, 1318 (Fed. Cir. 2016)
(“[W]ith the exception of generic computer-implemented steps, there is
nothing in the claims themselves that foreclose them from being performed
by a human, mentally or with pen and paper.”); Spec. ¶ 29 (“in other
embodiments, such methods may be carried out at least partially manually
by one or more users”); Fig. 3 (depicting an example supply chain map).
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Accordingly, claim 1 “recites a judicial exception . . . [and] requires
further analysis in Prong Two” of the Revised Guidance. Revised Guidance,
84 Fed. Reg. at 54.

II. Step 2A, Prong Two
Appellants contend the claims are patent eligible, because claim 1
provides “a particular manner of implementing intra-entity transaction
transfer prices determination in a computer system” (App. Br. 8), and recites
“a technical solution by providing a way to enable a computer system to
implement specific rules in a process to determine and account for transfer
prices on a function-by-function basis” (id. at 17 (emphasis added)).
We are not persuaded the Examiner’s rejection is in error pursuant to
Step 2A, Prong Two of the Revised Guidance. The claimed particular
manner of implementation using “each function” is part of the claimed
determining and accounting for net income based on intra-entity
transactions; as such, the disputed limitations are steps of the recited
organizing human activity and mental processes judicial exceptions
discussed above. See Final Act. 5. Thus, the disputed limitations are not
additional elements that amount to significantly more than the exception
itself. See Revised Guidance, 84 Fed. Reg. at 56; see also fn. 24 (emphasis
omitted) (“USPTO guidance uses the term ‘additional elements’ to refer to
claim features, limitations, and/or steps that are recited in the claim beyond
the identified judicial exception.”).
Even considered as additional elements, Appellants’ claimed “specific
and particular” rules do not integrate the abstract concept into a practical
application. App. Br. 7 (emphasis omitted); see Alice, 573 U.S. at 222,
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(quoting Parker v. Flook, 437 U.S. 584, 593 (1978)) (“In holding that the
process was patent ineligible, we rejected the argument that ‘implement[ing]
a principle in some specific fashion’ will ‘automatically fal[l] within the
patentable subject matter of § 101.’”). The recited function-by-function
calculations merely use the ordinary capabilities of the recited processor.
See Ans. 6 (“Appellant[s’] invention is a business solution to a problem
rooted in an abstract idea. The claimed limitations and the claimed
computing functionality do[] not incorporate a complex set of rules which
allow the computer to be improved.”) (emphasis added, bolding omitted);
see also FairWarning IP, LLC v. Iatric Sys., Inc., 839 F.3d 1089, 1095 (Fed.
Cir. 2016) (“[T]he fact that the required calculations could be performed
more efficiently via a computer does not materially alter the patent eligibility
of the claimed subject matter.”). That is, the claims effect, at most, a
financial or legal improvement rather than providing any technical benefit.
See Final Act. 23; Spec. ¶ 29; cf. Trading Techs. Int’l, Inc. v. IBG LLC,
Appeal No. 2017-2257, 2019 WL 1716242, at *3 (Fed. Cir. 2019) (“This
invention makes the trader faster and more efficient, not the computer. This
is not a technical solution to a technical problem.”).
Additionally, claim 1 includes a processor. The claimed “additional
element merely recites the words ‘apply it’ (or an equivalent) with the
judicial exception, or merely includes instructions to implement an abstract
idea on a computer, or merely uses a computer as a tool to perform an
abstract idea.” Revised Guidance, 84 Fed. Reg. at 55. Accordingly, we
determine claim 1 does not integrate the judicial exception into a practical
application. See Revised Guidance, 84 Fed. Reg. at 54. As the “claim
recites a judicial exception and fails to integrate the exception into a
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practical application” (id. at 51), “the claim is directed to the judicial
exception” (id. at 54).

III. Step 2B
Appellants do not show claim 1 includes significantly more than the
identified judicial exception itself. See Final Act. 7; see also Revised
Guidance, at 56. Based on the record before us, we determine the claimed
additional elements, individually and in combination, only recite generic
components and steps that are well-understood, routine, and conventional.
See Ans. 4–5; see also Spec. ¶¶ 3–6, 16–21, 25, 35, 36, 45–49; Alice, 573
U.S. at 226; and OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1363
(Fed. Cir. 2015).
Accordingly, we are not persuaded the Examiner errs in determining
claim 1 is patent ineligible. We sustain the Examiner’s rejection of claim 1
under 35 U.S.C. § 101; similarly, we sustain the Examiner’s ineligibility
determination for the remaining claims which are not separately argued. See
Final Act. 9–10; see also App. Br. 18–19.

B. 35 U.S.C. § 103
Appellants argue the Examiner errs in finding independent claim 1,
and particularly:
analyzing aspects of the product processed by a plurality of
divisions of an entity, located in different geographic locations,
during an intra-entity transaction associated with the product, the
aspects comprising the at least one metric, wherein the analyzing
comprises determining that the respective data entries of one or
more categories of the plurality of categories in the information
gathered from the first source correspond to respective data
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entries of the one or more categories in the additional
information, gathered from the second source;
to be obvious in view of the cited art. App. Br. 19–20. Particularly,
Appellants contend “Morgan’s disclosure of data sources is not sufficient to
teach the above features of claim 1 because Morgan does not disclose the
claimed correspondence between the respective data entries in the
information from the first and second sources.” Reply Br. 5; see also App.
Br. 20.
We are persuaded the Examiner has not shown Morgan teaches the
disputed limitation. Specifically, the Examiner finds Morgan teaches
“multiple types of information [disclosed] by category used in the process of
assigning cost per activity for the production of a product,” which “can be
comparison reports per site (e.g. business divisions producing similar
products within the same organization).” Ans. 11; Morgan 5:64–6:67 and
17:22–19:51. That is, as cited, Morgan teaches a system for generating a
variety of reports using different data, including the identification of similar
products produced. See Morgan 17:50–67. Claim 1, as consistent with the
Specification, requires more than the production of various reports including
product comparisons—the claim recites determining a correspondence
between data entries of first and second sources for a particular product.
Reply Br. 4–5; Spec. ¶ 56 (“generating the supply chain map 210 at 404 may
also include confirming that the respective categories and/or data entries
gathered from a first source match the corresponding categories and/or data
entries gathered from a second source different than the first source”). The
Examiner has not explained with sufficient particularity any such
correspondence determination in Morgan. Nor does the Examiner rely on
the other cited references for this limitation. See Ans. 11.
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Accordingly, the Examiner has not shown the cited references teach
or suggest all claim 1 limitations. We are constrained by the record to not
sustain the Examiner’s obviousness rejection of independent claim 1, of
independent claims 13 and 17 which recite similar limitations, and of the
claims dependent thereon. See App. Br. 20.

DECISION
The Examiner’s decision rejecting claims 1–5, 7, 8, 10, and 12–20 is
affirmed.
The Examiner’s decision is affirmed because we have affirmed at
least one ground of rejection with respect to each claim on appeal. See
37 C.F.R. § 41.50(a)(1). See 37 C.F.R. § 41.50(a)(1).
No time period for taking any subsequent action in connection with
this appeal may be extended under 37 C.F.R. § 1.136(a)(1)(iv).

AFFIRMED