Chicago Mercantile Exchange Inc.

Patent Trials and Appeals Board

Apr 2, 2020

14795379 - (D) (P.T.A.B. Apr. 2, 2020)

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.
14/795,379 07/09/2015 Richard Co 004672-15505Z-US 1076
12684 7590 04/02/2020
Lempia Summerfield Katz LLC/CME
20 South Clark Street
Suite 600
Chicago, IL 60603
EXAMINER
FU, HAO
ART UNIT PAPER NUMBER
3697
NOTIFICATION DATE DELIVERY MODE
04/02/2020 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):
docket-us@lsk-iplaw.com
mail@lsk-iplaw.com
pair_lsk@firsttofile.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte RICHARD CO, THOMAS BOGGS, TIMOTHY MCCOURT, and
JOHN KERPEL
Appeal 2019-001402
Application 14/795,379
Technology Center 3600
Before JAMES R. HUGHES, JOYCE CRAIG, and SCOTT E. BAIN,
Administrative Patent Judges.
CRAIG, Administrative Patent Judge.
DECISION ON APPEAL
STATEMENT OF THE CASE
Pursuant to 35 U.S.C. § 134(a), Appellant1 appeals from the
Examiner’s decision to reject claims 1–20. See Final Act. 1. We have
jurisdiction 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 s Chicago Mercantile
Exchange Inc. Appeal Br. 1.
Appeal 2019-001402
Application 14/795,379

2
CLAIMED SUBJECT MATTER
The claims are directed to processing an options contract that sets a
strike price at settlement. Spec. ¶ 1. An option on a calendar spread index
futures contract allows market participants to manage risks associated with
the volatility associated with the calendar spread market for index futures.
Spec. ¶ 6. Claim 1, reproduced below, is illustrative of the claimed subject
matter:
1 A system comprising:
an exchange computer system that includes:
an order book that determines bid and offer prices for
options contracts;
a match engine that matches bids and offers for options
contracts;
a trade database that stores trade information;
a clearing house computer system connected to the
exchange computer system and that includes a processor;
a computer-readable medium containing computer-
executable instructions that when executed by the processor
cause the clearing house computer system to:
(a) receive an implied financing rate for an options
contract;
(b) receive an index level at expiration of the options
contract; and
(c) determine a strike price for the options contract at
expiration based on an index level at expiration and the implied
financing rate.
REJECTION
Claims 1–20 stand rejected under 35 U.S.C. § 101 because the
claimed invention is directed to patent-ineligible subject matter. Final Act.
4–8.

Appeal 2019-001402
Application 14/795,379

3
ANALYSIS
Appellant argues that the Examiner’s rejection of claim 1 under
35 U.S.C. § 101 as directed to patent-ineligible subject matter is in error. To
the extent Appellant has not advanced separate, substantive arguments for
particular claims, or other issues, such arguments are waived. 37 C.F.R.
§ 41.37(c)(1)(iv). Appellant argues claims 1–20 as a group. Appeal Br. 4.
Given our discretion under 37 C.F.R. § 41.37(c)(1)(iv), we decide the § 101
rejection of claims 1–20 based on representative claim 1.
Principles of Law
“Whether a claim is drawn to patent-eligible subject matter is an issue
of law that we review de novo.” SiRF Tech., Inc. v. Int’l Trade Comm’n, 601
F.3d 1319, 1331 (Fed. Cir. 2010).
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 U.S. 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 Court’s two-part 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 that 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
Appeal 2019-001402
Application 14/795,379

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 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 (Gottschalk v. 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 waterproof cloth, vulcanizing India
rubber, smelting ores” (id. at 182 n.7 (quoting Corning v. Burden, 56 U.S.
252, 267–68 (1853))); 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
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 187; 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.”). Having said that, the Court also
indicated 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. (citation omitted)
(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.”).
Appeal 2019-001402
Application 14/795,379

5
If the claim is “directed to” an abstract idea, we turn to the second part
of the Alice and Mayo framework, where “we must examine the elements of
the claim to determine whether it contains an ‘inventive concept’ sufficient
to ‘transform’ the claimed abstract idea into a patent-eligible application.”
Alice, 573 U.S. at 221 (quotation marks omitted). “A claim that recites an
abstract idea must include ‘additional features’ to ensure ‘that the [claim] is
more than a drafting effort designed to monopolize the [abstract idea].’” Id.
(alterations in original) (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.
In January 2019, the U.S. Patent and Trademark Office (USPTO)
published revised guidance on the application of § 101. See 2019 Revised
Patent Subject Matter Eligibility Guidance, 84 Fed. Reg. 50 (Jan. 7, 2019)
(“2019 Revised Guidance”).2 “All USPTO personnel are, as a matter of
internal agency management, expected to follow the guidance.” Id. at 51;
see also October 2019 Update at 1.
Under the 2019 Revised Guidance and the October 2019 Update, we
first 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 activity such as a fundamental economic practice, or mental
processes) (“Step 2A, Prong One”); and

2 In response to received public comments, the Office issued further
guidance on October 17, 2019, clarifying the 2019 Revised Guidance.
USPTO, October 2019 Update: Subject Matter Eligibility (the “October
2019 Update”) (available at
https://www.uspto.gov/sites/default/files/documents/peg_oct_2019_update.p
df).
Appeal 2019-001402
Application 14/795,379

6
(2) additional elements that integrate the judicial exception into a
practical application (see MPEP § 2106.05(a)–(c), (e)–(h) (9th ed.
Rev. 08.2017, Jan. 2018)) (“Step 2A, Prong Two”).3
2019 Revised Guidance, 84 Fed. Reg. at 52–55.
Only if a claim (1) recites a judicial exception and (2) does not
integrate that exception into a practical application, do we then look, under
Step 2B, 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.
2019 Revised Guidance, 84 Fed. Reg. at 52–56.
Prima Facie Case
Appellant argues that the Examiner failed to make a prima facie case
of subject matter ineligibility by overgeneralizing and ignoring certain claim
elements. Appeal Br. 11.
We disagree. The procedural burden of establishing a prima facie case
is carried when the rejection satisfies the requirements of 35 U.S.C. § 132. In
re Jung, 637 F.3d 1356, 1363 (Fed. Cir. 2011). “Section 132 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.

3 This evaluation is performed by (a) identifying whether there are any
additional elements recited in the claim beyond the judicial exception, and
(b) evaluating those additional elements individually and in combination to
determine whether the claim as a whole integrates the exception into a
practical application. See 2019 Revised Guidance - Section III(A)(2), 84
Fed. Reg. 54–55.
Appeal 2019-001402
Application 14/795,379

7
Miller, 906 F.2d 1574, 1578 (Fed. Cir. 1990). That is, the Examiner must set
forth the rejection's statutory basis “in a sufficiently articulate and
informative manner as to meet the notice requirement of § 132.” Jung, 637
F.3d at 1363.
This is not a case where the “rejection is so uninformative that it
prevents the applicant from recognizing and seeking to counter the grounds
for rejection.” Id. at 1362. Rather, the Examiner has provided a rationale that
identifies the abstract idea recited in the claim and why it is considered an
exception. See Final Act. 5–8. And Appellant clearly identifies the abstract
idea identified by the Examiner. See, e.g., Appeal Br. 9.
Accordingly, we are not persuaded that the Examiner has failed to set
forth a prima facie case of patent ineligibility for representative claim 1.
Step 1
Claim 1, as a system claim, falls within the manufacture category of
§ 101. See 2019 Revised Guidance, 84 Fed. Reg. at 53–54 (citing MPEP
§§ 2106.03, 2106.06).
Step 2A(i): Does the Claim Recite a Judicial Exception?
The Examiner determined that claim 1 is directed to “processing
options contracts and determining a strike price of the options contracts,”
which is a fundamental economic practice and a method of organizing
human activity, and thus an abstract idea. Final Act. 4–6. The Examiner also
determined that determining the strike price of the options contracts is
related to mathematical relationships/formulas, which is a mathematical
concept and an abstract idea. See id. The Examiner identified the following
steps as part of the recited abstract idea:
Appeal 2019-001402
Application 14/795,379

8
determining bid and offer prices for options contracts, matching
bids and offers, storing trade information, receiving an implied
financing rate (e.g. interest rate benchmark) and an index level
at expiration for the options contracts, and determining a strike
price at expiration based on the index level at expiration and the
implied financing rate.
Final Act. 6.
Consistent with Appellant’s description of the claims, we find that the
limitations we summarize above describe a fundamental practice that falls
into the “certain methods of organizing human activity” category of abstract
ideas. See 84 Fed. Reg. at 52. The Specification describes that:
An option on a calendar spread index futures contract allows
market participants to manage risks associated with the
volatility associated with the calendar spread market for index
futures. The strike price of the option contract may be set at
expiration and the strike price may be a function of an implied
financing rate.
Spec. ¶ 6. Thus, the claimed subject matter is directed to risk management
for options contracts. There is no meaningful difference between risk
allocation and risk hedging (see Bilski v. Kappos, 561 U.S. 593 (2010)) and
risk management (see Int’l Sec. Exch., LLC v. Chicago Bd. Options Exch.,
Inc., No. CBM2013-00049 (PTAB March 2, 2015), aff’d, Chicago Bd.
Options Exch., Inc. v. Int'l Sec. Exch., LLC, 640 Fed. Appx. 986 (mem)
(Fed. Cir. 2016) (nonprecedential) (Rule 36)). Like them, risk management
for options contracts is a fundamental economic practice and as such is an
abstract idea.
Appellant argues that the Examiner erred because “[c]laim 1 expressly
recites that it’s directed to novel and inventive elements,” and “it is
inappropriate for the Office Action to disregard the specific limitations
Appeal 2019-001402
Application 14/795,379

9
recited in claims 1 and treat the claim at a high level of abstraction.” Appeal
Br. 7.
We are not persuaded that the Examiner erred. 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. Diamond v. Diehr, 450 U.S.
175, 188–89 (1981). Our reviewing court further guides that “[e]ligibility
and novelty are separate inquiries.” Two-Way Media Ltd. v. Comcast Cable
Commc’ns, LLC, 874 F.3d 1329, 1340 (Fed. Cir. 2017); see also Affinity
Labs of Tex., LLC v. DIRECTV, LLC, 838 F.3d 1253, 1263 (Fed. Cir. 2016)
(holding that “[e]ven assuming” that a particular claimed feature was novel
does not “avoid the problem of abstractness”).
Because we agree with the Examiner that the claim recites an abstract
idea, we proceed to Prong Two of Step 2A to determine if the idea is
integrated into a practical application, in which case the claim as a whole
would not be “directed to” merely an abstract idea.
Step 2A(ii): Judicial Exception Integrated into a Practical Application?
Because we determined that claim 1 recites a patent-ineligible
concept, we next determine whether the recited judicial exception is
integrated into a practical application of that exception by: (a) identifying
whether 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.
We use the term “additional elements” for claim features, limitations,
or steps that the claim recites beyond the identified judicial exception. See
Appeal 2019-001402
Application 14/795,379

10
Revised Guidance at 55 n.24. In claim 1, the additional elements include the
limitations “exchange computer system,” “order book,” “match engine,”
“trade database,” “clearing house computer system,” “processor,” and
“computer-readable medium containing computer-executable instructions.”
The Examiner determined that none of the additional limitations is
sufficient to amount to significantly more than the judicial exception
because the additional computer elements “appear to be generic computer
components performing basic computer functions.” Final Act. 7–8.
Appellant argues that claim 1 recites a specific, technological solution
to a real world problem. Appeal Br. 6 (citing Enfish, LLC v. Microsoft
Corp., 822 F.3d 1327, 1330 (Fed. Cir. 2016)). Appellant further argues that
claim 1 is like the claims in McRO, Inc. v. Bandai Namco Games America
Inc., 837 F.3d 1299, 1316 (Fed. Cir. 2016), in which the claims recite “rules
of selection in a manner different from those humans used before
Appellants’ invention.” Appeal Br. 8.
Appellant’s arguments are not persuasive because Appellant’s claim 1
is unlike the technology-based integrations cited by Appellant.
In Enfish, our reviewing court held claims directed to a self-referential
logical model for a computer database patent-eligible under step one of
Alice. Enfish, 822 F.3d at 1330. The disclosed technique enabled faster
searching and more effective storage of data than previous methods. Id. at
1333. The court found the claims directed to “a specific improvement to the
way computers operate, embodied in the self-referential table” (id. at 1336),
and explained that the claims are “not simply directed to any form of storing
tabular data, but instead are specifically directed to a self-referential table for
Appeal 2019-001402
Application 14/795,379

11
a computer database” that functions differently than conventional databases.
Id. at 1337.
Despite Appellant’s argument to the contrary, the instant claims are
not analogous to the claims addressed in Enfish, 822 F.3d at 1335–36. The
Enfish court distinguished between claims that focus on a specific
improvement in computer capabilities, on the one hand, and an abstract idea
that merely invokes computers as a tool, on the other. Id. at 1336. This case
involves the latter. Appellant does not claim to have invented new
networking hardware or software. Nor does Appellant claim to have
invented HTTP header fields, user identifiers, encryption techniques, or any
other improvement in the network technology underlying its claims. The
Specification describes that the invention fills a need to manage risks
associated with the extreme volatility of index futures through an option on
the index futures calendar spread, or an option on the roll. Spec. ¶ 30. But
each of these goals is in the abstract realm—an improvement in processing
options contracts—not an improvement in networking or computer
functionality. None of these alleged improvements “enables a computer . . .
to do things it could not do before.” Finjan, Inc. v. Blue Coat Sys., Inc., 879
F.3d 1299, 1305 (Fed. Cir. 2018) (emphasis added). Such claims, whose
focus is “not a physical-realm improvement but an improvement in a wholly
abstract idea,” are not eligible for patenting. SAP Am., Inc. v. InvestPic,
LLC, 898 F.3d 1161, 1168 (Fed. Cir. 2018).
In McRO, the other case cited by Appellant, the claims were not held
to be abstract because they recited a “specific . . . improvement in computer
animation” using “unconventional rules that relate[d] sub sequences of
phonemes, timings, and morph weight sets.” McRO, 837 F.3d at 1302–03,
Appeal 2019-001402
Application 14/795,379

12
1307–08, 1314–15. In McRO, “the incorporation of the claimed rules, not
the use of the computer,” improved an existing technological process. Id. at
1314. The claims in McRO recited a “specific . . . improvement in computer
animation” using “unconventional rules that relate[d] sub sequences of
phonemes, timings, and morph weight sets.” McRO, 837 F.3d at 1302–03,
1307–08, 1314–15. Moreover, in McRO, “the incorporation of the claimed
rules, not the use of the computer,” improved an existing technological
process. Id. at 1314.
Here, Appellant does not identify how claim 1 improves an existing
technological process. See Alice, 573 U.S. 223 (explaining that “the claims
in Diehr were patent eligible because they improved an existing
technological process”). Rather, claim 1 concerns a “system.” App. Br. 23.
In addition, Appellant does not direct us to any evidence that the claimed
steps correspond to unconventional rules.
In the Reply Brief, Appellant for the first time makes new arguments
with regard to McRO. Reply Br. 3–4. Because Appellant has presented the
new arguments without a showing of good cause, Appellant has waived the
arguments. See 37 C.F.R. § 41.41(b)(2) (2012); accord Ex parte Borden, 93
USPQ2d 1473, 1473-74 (BPAI 2010 (informative opinion) (“[T]he reply
brief [is not] an opportunity to make arguments that could have been made
in the principal brief on appeal to rebut the Examiner’s rejections, but were
not.”). We note that Appellant argues that, in claim 1, the “data processing
efficiency for option contracts” is improved. Reply Br. 4. Even if
Appellant’s arguments were timely, they are not persuasive. We are not
persuaded that the combination of the additional recited claim elements
integrates the abstract idea into a practical application, such that the
Appeal 2019-001402
Application 14/795,379

13
technology itself is improved. Appellant’s claimed additional elements do
not transform matter; at best, they transform information. See MPEP
§ 2106.05(c); see also Gottschalk v. Benson, 409 U.S. 63, 71-72 (1972)
(holding that a computer based algorithm that merely transforms data from
one form to another is not patent-eligible). As such, the claim has no other
meaningful limitations (see MPEP § 2106.05(e)), and merely recites
instructions to execute an abstract idea on generic computer hardware (see
MPEP § 2106.05(f)).
Appellant’s further argument, that claim 1 is patent-eligible because
its practice does not preempt practice by others, is also unavailing. Appeal
Br. 10. While preemption may signal patent ineligible subject matter, the
absence of complete preemption “does not demonstrate patent eligibility, . . .
where a patent’s claims are deemed only to disclose patent ineligible subject
matter under the Mayo framework, as they are in this case, preemption
concerns are fully addressed and made moot.” Ariosa Diagnostics, Inc. v.
Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir. 2015); see also OIP Techs.,
Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1362–63 (Fed. Cir. 2015) (“that
the claims do not preempt all price optimization or may be limited to price
optimization in the e-commerce setting do not make them any less
abstract”).
Considering claim 1 as a whole, then, Appellant’s invention lacks a
technical solution to a technical problem like the claims in these cases.
Claim 1 as a whole merely uses instructions to implement the abstract idea
on a computer or, alternatively, merely uses a computer as a tool to perform
the abstract idea. Here, the additional limitation(s) do not integrate the
judicial exception into a practical application. More particularly, the claims
Appeal 2019-001402
Application 14/795,379

14
do not recite (i) an improvement to the functionality of a computer or other
technology or technical field (see MPEP § 2106.05(a)); (ii) a “particular
machine” to apply or use the judicial exception (see MPEP § 2106.05(b));
(iii) a particular transformation of an article to a different thing or state
(see MPEP § 2106.05(c)); or (iv) any other meaningful limitation
(see MPEP § 2106.05(e)). See 2019 Revised Guidance, 84 Fed. Reg. at 55.
Rather, claim 1 recites an abstract ideas as identified in Step 2A(i), supra,
and none of the limitations integrates the judicial exception into a practical
application.
Therefore, because the abstract idea is not integrated into a practical
application, we conclude that the claim is directed to the judicial exception.
Step 2B — “Inventive Concept” or “Significantly More”
If the claims are directed to a patent-ineligible concept, as we
conclude above, we proceed to the “inventive concept” step. For Step 2B we
must “look with more specificity at what the claim elements add, in order to
determine ‘whether they identify an “inventive concept” in the application of
the ineligible subject matter’ to which the claim is directed.” Affinity Labs of
Texas, LLC v. DIRECTV, LLC, 838 F.3d 1253, 1258 (Fed. Cir. 2016)
(quoting Electric Power Group, LLC v. Alstom S.A., 830 F.3d 1350, 1353
(Fed. Cir. 2016)). We look to see whether there are any “additional features”
in the claims that constitute an “inventive concept,” thereby rendering the
claims eligible for patenting even if they are directed to an abstract idea.
Alice, 573 U.S. at 221. Those “additional features” must be more than “well-
understood, routine, conventional activity.” Mayo, 566 U.S. at 79.
The Examiner determined that the additional elements in claim 1 are
well-understood, routine, and conventional. See Ans. 7. The Examiner cited
Appeal 2019-001402
Application 14/795,379

15
Glinberg et al. (US 2012/0041892) to show that an exchange computer
system including an order book, a match engine, and a trade database were
well-known prior to the present application. Id. (citing Office Action filed on
10/31/2017). The Examiner also found that “these are conventional
components in almost every electronic trading system.” Id. The Examiner
further found that a computer, comprising generic components such as a
processor and a computer-readable memory, performing functions such as
receiving data over a network and performing repetitive calculations is
considered well-understood, routine, and conventional. Id. (citing MPEP
2106.05(d)).
Appellant argues that the Examiner must also provide evidence that
the limitation “determine a strike price for the options contract based on an
index level at expiration and the implied financing rate” is well-understood,
routine, and conventional. Reply Br. 6.
We disagree with Appellant. The “determine” limitation is part of the
abstract idea, not an additional element. See 2019 Revised Guidance, 84 Fed.
Reg. 56.
Appellant further argues that, even if the Glinberg reference discloses
an order book, a match engine, and a trade database, such disclosure does
not establish that those elements are well-understood, routine, and
conventional. Reply Br. 6.
We are not persuaded of Examiner error at least because we find that
the general, high-level descriptions in Appellant’s Specification bolster the
Examiner’s “well-understood, routine, and conventional” findings. See Spec.
¶¶ 15–17, 25, 30. For example, the Specification describes that the
“exchange computer system” may be implemented with one or more
Appeal 2019-001402
Application 14/795,379

16
mainframe, desktop or other computers. Spec. ¶ 15. The Specification
describes that an “order book” module may be included to store prices and
other data for bid and offer orders, and/or to compute (or otherwise
determine) current bid and offer prices. Id. With regard to the recited “match
engine,” the Specification describes that a match engine module is included
to match prices and other parameters of bid and offer orders, and may be
implemented with software that executes one or more algorithms for
matching bids and offers. Id. The Specification describes that a “trade
database” may be included to store information identifying trades and
descriptions of trades, and may store information identifying the time that a
trade took place and the contract price. Id. at 16. The Specification further
describes that a “clearing house computer system” may receive data from
and/or transmit data to the trade database and/or other modules of the
computer system regarding trades of futures contracts, futures contracts
options, OTC options and contracts, and other financial products. Id. at 17.
The Specification also describes that the clearing house computer system
may include a processor that controls the operation of the clearing house
computer system. Id. at 30. The Specification describes that the operations
of computer devices and systems shown in Figure 1 of the Specification may
be controlled by “computer-executable instructions stored on non-transitory
computer-readable media.” Id. at 25. The Specification describes that a
computer device may include computer-executable instructions for receiving
market data from the exchange computer system and displaying that
information to a user. Id.
Appellant does not direct our attention to anything in the Specification
that indicates the computer components perform anything other than well-
Appeal 2019-001402
Application 14/795,379

17
understood, routine, and conventional functions, such as receiving data,
looking up data in a database, attempting to execute commands, and storing
data in a database. See buySAFE, Inc. v. Google, Inc., 765 F.3d 1350, 1355
(Fed. Cir. 2014) (“That a computer receives and sends the information over
a network—with no further specification—is not even arguably inventive”);
In re TLI Commc’ns LLC Patent Litig., 823 F.3d 607, 614 (Fed. Cir. 2016)
(server that receives data, extracts classification information from the
received data, and stores the digital images insufficient to add an inventive
concept); Alice, 573 U.S. at 225–26 (receiving, storing, sending information
over networks insufficient to add an inventive concept).
Because the Specification describes the additional elements in general
terms, without describing the particulars, we conclude the claim limitations
may be broadly but reasonably construed as reciting conventional computer
components and techniques, particularly in light of Appellant’s
Specification, as cited above. See Berkheimer Memo4 § III.A.1; Spec. ¶¶ 15–
17, 25, 30. We conclude claim 1 does not have an inventive concept because
the claim, in essence, merely recites various computer-based elements along
with no more than mere instructions to implement the identified abstract idea
using the computer-based elements.

4 “Changes in Examination Procedure Pertaining to Subject Matter
Eligibility, Recent Subject Matter Eligibility Decision (Berkheimer v. HP,
Inc.)” at 3 (Apr. 19, 2018) (explaining that a specification that describes
additional elements “in a manner that indicates that the additional elements
are sufficiently well-known that the specification does not need to describe
the particulars of such additional elements to satisfy 35 U.S.C. § 112(a)” can
show that the elements are well understood, routine, and conventional).
Appeal 2019-001402
Application 14/795,379

18
Appellant’s Other Arguments
Appellant contends that the Examiner erred because “[t]he current
two-stage Alice test used in the Office Action is the incorrect application of
Congress’s intent in passing the Patent Act of 1952 and 35 U.S.C. § 101.
Appeal Br. 11. In particular, Appellant argues that “the Office Action
impermissibly deviates from the intention of the patent eligibility statute
when it evaluates the inventiveness of the claims in relation to patent
eligibility.” Id.
We are not persuaded of Examiner error. Appellant did not identify
where the Examiner “evaluated the inventiveness of the claims in relation to
patent eligibility,” and we will not engage in speculation as to that point. It is
well settled that mere attorney arguments and conclusory statements, which
are unsupported by factual evidence, are entitled to little probative value. In
re Geisler, 116 F.3d 1465, 1470 (Fed. Cir. 1997); see also In re Pearson,
494 F.2d 1399, 1405 (CCPA 1974) (attorney argument is not evidence).
Appellant also contends that “a persistent 35 USC 101 rejection
violates the requirements of the Administrative Procedures Act (APA),
which prohibits the USPTO from making decisions that are ‘arbitrary,
capricious, [or] an abuse of discretion.’” Appeal Br. 12 (citing 5 U.S.C.
706).
Appellant has not explained persuasively why or how the Examiner’s
§ 101 rejection violates the APA. Indeed, the 2019 Revised Guidance does
not require us to depart from the § 101 analysis provided by precedent.
Rather, the “USPTO ... aims to clarify the analysis” “[i]n accordance with
judicial precedent and in an effort to improve consistency and
predictability[.]” 84 Fed. Reg. 50, 53 (Jan. 7, 2019).
Appeal 2019-001402
Application 14/795,379

19
Appellant also argues that the Examiner’s § 101 rejection is contrary
to the “substantial evidence” standard set forth by the Court of Appeals for
the Federal Circuit. Id. (citing In Re Oetiker, 977 F.2d 1433, 1445 (Fed. Cir.
1992), Ex parte Poisson, Appeal 2012-011084 (PTAB, Feb. 27, 2015) (non-
precedential).
Appellant’s argument is unpersuasive because whether a claim is
directed to patent-eligible subject matter is an issue of law. SiRF Tech., Inc.
v. Int’l Trade Comm’n, 601 F.3d 1319, 1331 (Fed. Cir. 2010). Although
evidence may be helpful when facts are in dispute, there is no requirement
that an examiner provide evidentiary support in before a conclusion can be
made that a claim is directed to an abstract idea. See Mortgage Grader, Inc.
v. First Choice Loan Servs. Inc., 811 F.3d 1314, 1325–26 (Fed. Cir. 2016)
(explaining “it is also possible, as numerous cases have recognized, that a
§ 101 analysis may sometimes be undertaken without resolving fact issues”).
Oetiker requires that, in reviewing the Examiner’s decision on appeal,
the Board must necessarily weigh all of the evidence and arguments. 977
F.2d at 1445. This panel did consider all of Appellant’s argument in its
deliberations and reviewed the particular findings contested anew.
Appellant also cites Ex parte Poisson, Appeal 2012-011084 (PTAB
2015) (non-precedential) in support of the proposition that an Office Action
must provide substantial evidence in support of a § 101 rejection. Id. This is
unpersuasive. In Ex parte Poisson, which is not binding precedent, the
Board reversed a § 101 rejection because there was a complete lack of
support, including in the specification, for the examiner’s determination that
the claim at issue was directed to an abstract idea; here, on the other hand,
Appeal 2019-001402
Application 14/795,379

20
Appellant’s Specification specifically supports the determination that claim
1 is directed to an abstract idea.
For these reasons, we are not persuaded by Appellant’s other
arguments that the Examiner erred in rejecting claims 1–20 under § 101.
Conclusion
Because claim 1 is directed to a judicial exception, without
significantly more, we sustain the Examiner's § 101 rejection of independent
claim 1 and grouped claims 2–20, not argued separately with particularity.
DECISION
We affirm the decision of the Examiner rejecting claims 1–20.
DECISION SUMMARY
Claims
Rejected
35 U.S.C. § Reference(s)/Ba
sis
Affirmed Reversed
1–20 101 Eligibility 1–20

TIME PERIOD FOR RESPONSE
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.
§ 1.136(a)(1)(iv).
AFFIRMED