David Weis et al.

Patent Trials and Appeals Board

Aug 26, 2019

14290491 - (D) (P.T.A.B. Aug. 26, 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.
14/290,491 05/29/2014 David Weis 21652-00345 2800
75564 7590 08/26/2019
DANIEL M. FITZGERALD (21652)
ARMSTRONG TEASDALE LLP
7700 Forsyth Boulevard
Suite 1800
St. Louis, MO 63105
EXAMINER
ROSEN, NICHOLAS D
ART UNIT PAPER NUMBER
3625
NOTIFICATION DATE DELIVERY MODE
08/26/2019 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):
USpatents@armstrongteasdale.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________

Ex parte DAVID WEIS, GARY SOFKO, GARY KEARNS,
and WALTER LO FARO
____________

Appeal 2018-007454
Application 14/290,4911
Technology Center 3600
_______________

Before JOSEPH L. DIXON, HUNG H. BUI, and JON M. JURGOVAN,
Administrative Patent Judges.

BUI, Administrative Patent Judge.

DECISION ON APPEAL
Appellants seek our review under 35 U.S.C. § 134(a) from the
Examiner’s Final Rejection of claims 1, 3, 5–9, 12–18, and 20, which are all
the claims pending in the application. We have jurisdiction under 35 U.S.C.
§ 6(b).
We AFFIRM.2

1 According to Appellants, the real party in interest is MasterCard
International Incorporated. App. Br. 1.
2 Our Decision refers to Appellants’ Appeal Brief (“App. Br.”) filed April
20, 2018; Reply Brief (“Reply Br.”) filed July 18, 2018; Examiner’s Answer
(“Ans.”) mailed May 18, 2018; Final Office Action (“Final Act.”) mailed
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STATEMENT OF THE CASE
Appellants’ invention is directed to a method and system “for
recommending merchants to a potential consumer based at least in part on
. . . a search location provided by the potential customer and historical
payment transactions of cardholders local to the search location” by
“calculat[ing] a local popularity score for each merchant based on the
number of unique cardholders and cardholder inferred residential zip codes,
and generat[ing] a list of merchants based on the local popularity score.”
Spec. ¶ 2; Abstract.
Claims 1, 9, and 16 are independent. Independent claim 1,
reproduced below, is exemplary of the subject matter on appeal.
1. A computer system for recommending a merchant to a
candidate consumer, said computer system comprising:
a memory device for storing data; and
one or more processors in communication with said
memory device, said one or more processors programmed to:
collect transaction information, from a payment network
configured to process payment card transactions, for transactions
between a plurality of cardholders and a plurality of merchants
over a predetermined time period, the transaction information
including at least a merchant identifier associated with each
transaction;
identify a first set of merchants from the plurality of
merchants that are associated with a first merchant category by
electronically analyzing the transaction information, wherein the
first merchant category includes brick and mortar merchant
locations that are predetermined as being patronized by local
residents;

November 17, 2017; and original Specification (“Spec.”) filed May 29,
2014.
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identify a first merchant zip code for each merchant of the
first set of merchants;
store, within a database, the first set of merchants along
with the corresponding first merchant zip codes;
infer a residential zip code for each cardholder of the
plurality of cardholders by electronically analyzing the
transaction information between each cardholder of the plurality
of cardholders and each merchant of the first set of merchants
including determining the inferred residential zip code for each
cardholder based at least in part on the stored first merchant zip
codes;
identify a second set of merchants from the plurality of
merchants that are associated with a second merchant category
by electronically analyzing the transaction information, wherein
the second merchant category is different from the first merchant
category;
identify a second merchant zip code for each merchant of
the second set of merchants;
store, within the database, the second set of merchants
along with the corresponding second merchant zip codes;
determine a number of unique cardholders from the
plurality of cardholders that have performed a transaction with
each merchant from the second set of merchants, wherein to be a
unique cardholder to a particular merchant the unique cardholder
must have performed at least one transaction with the particular
merchant and reside at an actual distance from the particular
merchant that is less than a predefined threshold distance,
wherein the actual distance is calculated based on the inferred
residential zip code assigned to the unique cardholder and the
merchant zip code assigned to the particular merchant;
calculate a local popularity score for each merchant from
the second set of merchants based on the determined number of
unique cardholders for each merchant from the second set of
merchants and the actual distance between each of the merchants
from the second set of merchants and each corresponding unique
cardholder;
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generate a list of recommended merchants based on the
local popularity score; and
display the list of recommended merchants to the
candidate consumer.

App. Br. 14–15 (Claims App.).

Examiner’s Rejection
Claims 1, 3, 5–9, 12–18, and 20 stand rejected under 35 U.S.C. § 101
because the claimed invention is directed to an abstract idea without
significantly more. Final Act. 2–12.

ANALYSIS
In support of the § 101 rejection of claims 1, 3, 5–9, 12–18, and 20,
the Examiner determines Appellants’ claims are “directed to a method of
recommending at least one merchant to a candidate consumer, which is an
abstract idea in the field of [a] fundamental economic practice.” Final Act.
2; Ans. 15, 18–19. The Examiner also finds each of the steps performed by,
for example, claim 1’s processor “is something that a human being could
perform mentally or using pen and paper (except that analyzing performed
by a human being would not be done electronically), and that a generic
computer could readily be programmed to perform.” Final Act. 4–5; see
also Ans. 19.
The Examiner then determines the claim elements, when analyzed
individually and as an ordered combination, do not amount to significantly
more than the abstract idea. Final Act. 5; Ans. 18.

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Legal Framework
To determine whether claims are patent eligible under § 101, we apply
the Supreme Court’s two-step framework articulated in Alice Corp. v. CLS
Bank Int’l, 573 U.S. 208 (2014). First, we determine whether the claims are
directed to a patent-ineligible concept: laws of nature, natural phenomena,
and abstract ideas. Id. at 216. If so, we then proceed to the second step to
consider the elements of the claims “individually and ‘as an ordered
combination’” to determine whether there are additional elements that
“‘transform the nature of the claim’ into a patent-eligible application.” Id. at
217. In other words, the second step is to “search for an ‘inventive
concept’—i.e., 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.’” Id. at 218 (alteration in original).
The Federal Circuit has described the Alice step-one inquiry as
looking at the “focus” of the claims, their “character as a whole,” and the
Alice step-two inquiry as looking more precisely at what the claim elements
add—whether they identify an “inventive concept” in the application of the
ineligible matter to which the claim is directed. See Elec. Power Grp., LLC
v. Alstom S.A., 830 F.3d 1350, 1353 (Fed. Cir. 2016); Enfish, LLC v.
Microsoft Corp., 822 F.3d 1327, 1335–36 (Fed. Cir. 2016); Internet Patents
Corp. v. Active Network, Inc., 790 F.3d 1343, 1346 (Fed. Cir. 2015).
To achieve clarity and consistency in how the Office applies the
Supreme Court’s two-step framework, the Office recently published revised
guidance interpreting governing case law and establishing a framework to
govern all patent-eligibility analysis under Alice and § 101 effective as of
January 7, 2019. 2019 Revised Patent Subject Matter Eligibility Guidance,
84 Fed. Reg. 50–57 (Jan. 7, 2019) (“2019 Revised Guidance”).
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2019 Revised Guidance
Under the Revised Guidance, we first look under Alice step 1 or “Step
2A” to whether the claim recites:
(1) Prong One: any judicial exceptions, including certain
groupings of abstract ideas (i.e., [i] mathematical concepts,
[ii] mental processes, or [iii] certain methods of organizing
human activity such as a fundamental economic practice or
managing personal behavior or relationships or interactions
between people); and

(2) Prong Two: additional elements that integrate the judicial
exception into a practical application (see Manual of Patent
Examining Procedure (“MPEP”) §§ 2106.05(a)–(c), (e)–
(h)).3
See 2019 Revised Guidance, 84 Fed. Reg. at 51–52, 55, Revised Step 2A,
Prong One (Abstract Idea) and Prong Two (Integration into A Practical
Application). Only if a claim: (1) recites a judicial exception, and (2) does
not integrate that exception into a practical application, do we then evaluate
whether the claim provides an “inventive concept” under Alice step 2 or
“Step 2B.” See 2019 Revised Guidance at 56; Alice, 573 U.S. at 217–18.
For example, we look to whether the claim:
1) adds a specific limitation beyond the judicial exception that is
not “well-understood, routine, conventional” in the field (see
MPEP § 2106.05(d)); or

2) simply appends well-understood, routine, and conventional
activities previously known to the industry, specified at a high
level of generality, to the judicial exception.
See 2019 Revised Guidance, 84 Fed. Reg. at 56.

3 All references to the MPEP are to the Ninth Edition, Revision 08.2017
(rev. Jan. 2018).
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Alice/Mayo—Step 1 (Abstract Idea)
Step 2A–Prongs 1 and 2 identified in the Revised Guidance
Step 2A—Prong 1
Appellants argue claims 1, 9, and 16 are not directed to an abstract
idea, rather, the claims are “directed a merchant analytic (MA) computer
system that acts in concert with an electronic payment network to perform
an algorithm that calculates improved merchant recommendations for a
candidate consumer” by calculating a local popularity score for each
merchant. Reply Br. 3–4; App. Br. 7. Appellants assert representative
claim 1 provides technological improvements similar to the claims in McRO
because claim 1 (i) “improve[s] the technology of processing electronic
payment transaction information and data signals from a payment network to
generate merchant recommendations with improved accuracy for display to
a consumer,” (ii) “improve[s] display technology,” and (iii) achieves “an
improved technological result” by “applying stored rules in a unique and
specific manner to transaction information, and outputting recommendations
with improved accuracy for display to a consumer.” Reply Br. 4; App. Br.
7–9 (citing McRO, Inc. v. Bandai Namco Games Am. Inc., 837 F.3d 1299
(Fed. Cir. 2016)).
Appellants’ arguments are not persuasive. At the outset, we note
Appellants argue independent claims 1, 9, and 16 together. See App. Br. 7,
10; Reply Br. 2, 6. Therefore, we select independent claim 1 as the
representative claim for the group and address Appellants’ arguments
thereto. See 37 C.F.R. § 41.37(c)(1)(iv) (2017). Here, representative claim
1 recites a computer system that performs a method resulting in a list of
ranked merchants for an interested consumer. More specifically,
representative claim 1 recites the following limitations: (1) “collect[ing]
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transaction information, from a payment network configured to process
payment card transactions, for transactions between a plurality of
cardholders and a plurality of merchants over a predetermined time period,
the transaction information including at least a merchant identifier associated
with each transaction”; (2) “identify a first set of merchants from the
plurality of merchants that are associated with a first merchant category by
electronically analyzing the transaction information,” “identify a first
merchant zip code for each merchant of the first set of merchants,” “infer a
residential zip code for each cardholder of the plurality of cardholders by
electronically analyzing the transaction information between each cardholder
of the plurality of cardholders and each merchant of the first set of
merchants” including “determining the inferred residential zip code for each
cardholder based at least in part on the stored first merchant zip codes,”
“identify a second set of merchants from the plurality of merchants that are
associated with a second merchant category by electronically analyzing the
transaction information, wherein the second merchant category is different
from the first merchant category,” “identify a second merchant zip code for
each merchant of the second set of merchants,” and “determine a number of
unique cardholders from the plurality of cardholders that have performed a
transaction with each merchant from the second set of merchants” wherein
“to be a unique cardholder to a particular merchant the unique cardholder
must have performed at least one transaction with the particular merchant
and reside at an actual distance from the particular merchant that is less than
a predefined threshold distance” and “the actual distance is calculated based
on the inferred residential zip code assigned to the unique cardholder and the
merchant zip code assigned to the particular merchant”; (3) “calculate a local
popularity score for each merchant from the second set of merchants” based
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on “the determined number of unique cardholders for each merchant from
the second set of merchants and the actual distance between each of the
merchants from the second set of merchants and each corresponding unique
cardholder” and “generate a list of recommended merchants based on the
local popularity score”; (4) “store . . . the first set of merchants along with
the corresponding first merchant zip codes” and “store . . . the second set of
merchants along with the corresponding second merchant zip codes”; and
(5) “display the list of recommended merchants to the candidate consumer.”
App. Br. 14–15 (Claim 1). These limitations, under their broadest
reasonable interpretation, recite ranking and recommending merchants to
potential consumers to improve consumer experience and increase
merchants’ profit margins, which is a fundamental economic practice that is
common in the financial and commercial industry.
For example, limitation (1) in claim 1 describes collecting payment
network data including cardholders’ transaction information with respect to
particular merchants, which is an activity ordinarily performed by businesses
and other entities associated with (or working with) a payment network to
study consumer interests and market segmentation. See Spec. ¶¶ 33, 37, 49.
Limitation (2) in claim 1 describes an analysis of consumers’ transaction
information to determine consumers’ shopping locations and shopping
activity at street stores and other merchants having physical locations
identified by zip codes—activities ordinarily performed by market research
entities when cumulating and analyzing consumer data to determine
consumers’ interests and shopping behavior. Limitation (3) in claim 1
describes ranking and recommending merchants to consumers, which are
activities ordinarily performed by marketing entities and services that
provide retail and shopping recommendations to potential customers.
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Limitation (4) in claim 1 describes storing merchant data including merchant
locations, which is an activity ordinarily performed by market research
entities that cumulate merchant data. Limitation (5) in claim 1 describes
displaying merchant recommendations to a consumer—an activity ordinarily
performed by a marketing service providing shopping information to
potential consumers.
Thus, limitations (1)–(5) in claim 1 recite ranking merchants and
recommending merchants to potential consumers to improve consumer
experience and increase merchants’ profit margins, which is a known
business activity and a fundamental economic practice in our system of
commerce, similar to other concepts identified by the courts as abstract
ideas. For example, like the risk hedging in Bilski, the intermediated
settlement in Alice, and customizing of information based on information
known about a user in Intellectual Ventures, ranking merchants and
recommending them to consumers is a fundamental business practice long
prevalent in our system of commerce. Ans. 20; see Bilski v. Kappos, 561
U.S. 593, 599, 611–12 (2010) (risk hedging); Alice, 573 U.S. at 215–19
(intermediated settlement of traded or exchanged financial obligations to
mitigate the risk that one party will not perform); Intellectual Ventures I
LLC v. Capital One Bank (USA), 792 F.3d 1363, 1369 (Fed. Cir. 2015)
(“tailoring content based on the viewer’s location or address. . . . is ‘a
fundamental . . . practice long prevalent in our system,’” similar to using
“newspaper inserts [that] had often been tailored based on information
known about the customer—for example, a newspaper might advertise based
on the customer’s location”); Affinity Labs of Texas, LLC v. Amazon.com,
838 F.3d 1266, 1269, 1271 (Fed. Cir. 2016) (“the concept of delivering user-
selected media content to portable devices [(in a method for targeted
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advertising in which an advertisement is selected for delivery to the user of a
portable device based on at least one piece of demographic information
about the user)] is an abstract idea,” and “‘customizing information based on
. . . information known about the user’ is an abstract idea” (citing
Intellectual Ventures I LLC, 792 F.3d at 1369)); Morsa v. Facebook, Inc., 77
F. Supp. 3d 1007, 1013 (C.D. Cal. 2014), aff’d, 622 F. App’x 915 (Fed. Cir.
2015) (“[t]he concept of gathering information about one’s intended market
and attempting to customize the information then provided is as old as the
saying, ‘know your audience.’” (quoting OpenTV, Inc. v. Netflix Inc., 76 F.
Supp. 3d 886, 893 (N.D. Cal. 2014))). Ranking merchants and
recommending them to consumers is also a building block of a market
economy and, like risk hedging and intermediated settlement, is an “abstract
idea” beyond the scope of § 101. See Alice, 573 U.S. at 219. Thus, similar
to the concept of intermediated settlement in Alice, the concept of hedging in
Bilski, and customizing information based on information known about users
in Intellectual Ventures, the concept of ranking merchants and
recommending them to consumers (as in Appellants’ claim 1) “[is] a
fundamental economic practice long prevalent in our system of commerce.”
See Alice, 573 U.S. at 219; Bilski, 561 U.S. at 611–12 (“Claims 1 and 4 in
petitioners’ application explain the basic concept of hedging, or protecting
against risk.”).
We therefore conclude limitations (1)–(5) in representative claim 1,
and similar limitations in grouped claims 9 and 16, recite ranking and
recommending merchants to consumers, which is a fundamental economic
practice and one of the certain methods of organizing human activity
identified in the Revised Guidance, and therefore an abstract idea. See 2019
Revised Guidance (Revised Step 2A, Prong One), 84 Fed. Reg. at 52
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(describing an abstract idea category of “[c]ertain methods of organizing
human activity—fundamental economic principles or practices . . .
commercial or legal interactions (including . . . advertising, marketing or
sales activities or behaviors; business relations)”), 54.
Alternatively, we further note (in agreement with the Examiner’s
findings) that limitations (1)–(5) in claim 1 recite steps readily performable
by human beings (e.g., by a business analyst analyzing cardholder
transactions at local merchants). Ans. 17, 19. Particularly, claim 1 recites
data analysis and calculations that can be performed manually, by a person
using a pen and paper to identify residential zip codes based on locations of
a plurality of cardholders’ transactions (e.g., at least two cardholders’
transactions), determine a number of unique cardholders, calculate local
merchant popularity scores, and generate a merchant list based on the scores.
Id. Thus, we conclude limitations (1)–(5) in claim 1 recite concepts that can
be performed mentally and manually, which is another abstract idea
identified in the Revised Guidance. See 2019 Revised Guidance, 84 Fed.
Reg. at 52, 54; CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d at
1372–73 (“[A] method that can be performed by human thought alone is
merely an abstract idea and is not patent-eligible under § 101.”). Claim 1’s
“memory device” and “one or more processors” automate such actions
manually performable with pen and paper, however, mental processes
remain unpatentable even when automated to reduce the burden on the user
of what once could have been done with pen and paper. See CyberSource
Corp. v. Retail Decisions, Inc., 654 F.3d 1366, 1375 (Fed. Cir. 2011) (“That
purely mental processes can be unpatentable, even when performed by a
computer, was precisely the holding of the Supreme Court in Gottschalk v.
Benson.”). Thus, we disagree with Appellants’ argument that the claims are
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patent eligible because “the claims clearly recite computer components (e.g.,
memory devices, processors, merchant analytic computer system)
performing the recited steps.” See Reply Br. 2.
In conclusion, representative claim 1, and grouped independent claims
9 and 16, recite mental processes and a fundamental economic practice.
Step 2A—Prong 2 (Integration into Practical Application)
Under Revised Step 2A, Prong Two of the Revised Guidance, we
discern no additional element (or combination of elements) recited in
Appellants’ claims 1, 9, and 16 that may have integrated the judicial
exception into a practical application. See 2019 Revised Guidance, 84 Fed.
Reg. at 54–55. For example, Appellants’ claimed additional elements (e.g.,
“a memory device,” “one or more processors,” “a database,” and “computer-
readable storage media”) 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); Ans. 16, 19.
Here, Appellants’ claim 1 merely links the use of a judicial exception
to a particular technological environment. That is, although Appellants’
claim recites hardware components (generic processors, memory, and a
database), the processors, memory, and database are configured to perform
numerous real-world functions and operations, adding nothing of substance
to the underlying abstract idea. It is clear from the claims and the
Specification (describing a “[m]emory area 285 [that] may include, but are
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not limited to, random access memory (RAM) such as dynamic RAM
(DRAM) or static RAM (SRAM), read-only memory (ROM), erasable
programmable read-only memory (EPROM), electrically erasable
programmable read-only memory (EEPROM), and non-volatile RAM
(NVRAM),” a “[d]atabase 120 [that] may include a single database having
separated sections or partitions or may include multiple databases, each
being separate from each other,” and a “system [that] is being run in a
Windows® environment. . . . [or] on a mainframe environment and a
UNIX® server environment. . . . The application is flexible and designed to
run in various different environments without compromising any major
functionality”), these limitations require no improved processor, memory, or
database. See Spec. ¶¶ 34, 47, 57, 66; Final Act. 3; Ans. 21. Thus, the
claims’ limitations are not indicative of “integration into a practical
application.” Rather, the processors and memory are readily available
computing elements using their already available basic functions as tools in
executing the claimed ranking and recommending merchants. See SAP Am.,
Inc. v. InvestPic LLC, 898 F. 3d 1161 (Fed. Cir. 2018).
We also note Appellants’ reliance on McRO is misplaced. For
example, McRO’s ’576 patent (U.S. Patent No. 6,307,576) describes
computer software for matching audio to a 3D animated mouth movement to
provide lip-synched animation. McRO’s claims contain (i) specific
limitations regarding a set of rules that “define[] a morph weight set stream
as a function of phoneme sequence and times associated with said phoneme
sequence” to enable computers to produce “accurate and realistic lip
synchronization and facial expressions in animated characters” (McRO, 837
F.3d at 1313) and, when viewed as a whole, are directed to (ii) a
“technological improvement over the existing, manual 3–D animation
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techniques” that uses “limited rules in a process specifically designed to
achieve an improved technological result in conventional industry practice.”
Id. at 1316.
In contrast to McRO, Appellants’ Specification and claims do not
describe technological improvements or specific improvements to the way
computers operate. Rather, Appellants’ Specification and claims describe
techniques for ranking and recommending businesses (e.g., restaurants)
based on shopping activity of “local residents or ‘locals’ [which] are often
less likely to provide reviews at restaurants in which they frequent,” while
preventing biased recommendations such as reviews from “consumers [that]
are more likely to post a review based on a bad experience at a restaurant
than they are to post a positive review.” See Spec. ¶¶ 4, 27–28, 89–90.
Appellants argue claim 1 provides technological improvements
similar to McRO because the claim is “directed to applying specific rules to
generate and display improved merchant recommendations” and “also
improve[s] display technology.” App. Br. 9; Reply Br. 4. However, neither
claim 1 nor Appellants’ Specification describes an improvement to display
technology—rather, claim 1 merely requires displaying data. App. Br. 14–
15 (Claim 1 (“display the list of recommended merchants to the candidate
consumer”)); Ans. 15–16. Appellants also do not explain why the claimed
steps for calculating improved merchant recommendations (e.g., inferring a
residential zip code, determining a number of unique cardholders,
calculating a local popularity score, and generating a list of recommended
merchants based on the score) would be similar to McRO’s “rules [used] in a
process specifically designed to achieve an improved technological result.”
McRO, 837 F.3d at 1314, 1316 (describing technological improvements in
computer animation); Ans. 13–15.
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Appellants further argue claim 1 provides technological
improvements similar to McRO because the claim “improve[s] the
technology of processing electronic payment transaction information and
data signals from a payment network to generate merchant recommendations
with improved accuracy for display to a consumer.” Reply Br. 4. We
remain unpersuaded because neither claim 1 nor Appellants’ Specification
describes an improvement to the technology of processing electronic
payment transaction information. Ans. 16, 23. Rather, claim 1 merely
requires collecting such transaction information and analyzing the
information in steps that can be performed by a person using a pen and
paper, as discussed supra.
For these reasons, we agree with the Examiner’s determination that
claim 1, and grouped claims 9 and 16, are directed to an abstract idea that
does not integrate a practical application.
Alice/Mayo—Step 2 (Inventive Concept)
Step 2B identified in the Revised Guidance
In the second step of the Alice inquiry, Appellants argue claims 1, 9,
and 16 recite significantly more than a judicial exception for the reasons
that: (1) the claims “constitute an advance in computer technology, as they
are directed to processing electronic payment transaction information and
data signals from a payment network to generate merchant recommendations
with improved accuracy for display to a consumer” (Reply Br. 5–6); (2)
“like the filtering system of Bascom, the specific arrangement and
distribution of functionality provided in the pending claims facilitates the
practical application” of “analyzing electronic payment transaction
information and data signals from a payment network to generate merchant
recommendations for displaying to a consumer” (App. Br. 11–12 (citing
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Bascom Glob. Internet Servs., Inc. v. AT&T Mobility LLC, 827 F.3d 1341,
1352, 1350 (Fed. Cir. 2016)); Reply Br. 5–6); (3) the “claims include a
combination of limitations that operate in a non-conventional and non-
generic way to process electronic payment transaction information and data
signals from a payment network to generate accurate merchant
recommendations for displaying to a consumer” (Reply Br. 5–6; App. Br.
10–11); and (4) “the recitations of the present claims are clearly not widely
prevalent or in common use in the relevant industry, as the present claims
are not rejected under Sections 102 or 103,” and “the Examiner has failed to
provide a factual determination that the claimed elements are well-
understood, routine, and conventional” (Reply Br. 2–3, 5–6 (citing
Berkheimer v. HP Inc., 881 F.3d 1360, 1367 (Fed. Cir. 2018))).
Appellants’ arguments are not persuasive. Under Federal Circuit
precedent, an “inventive concept” under Alice step 2 can be established by
showing, for example, that the patent claims:
(1) provide a technical solution to a technical problem unique
to the Internet, e.g., a “solution . . . necessarily rooted in
computer technology in order to overcome a problem
specifically arising in the realm of computer networks”
(see DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d
1245, 1257 (Fed. Cir. 2014));
(2) transform the abstract idea into “a particular, practical
application of that abstract idea,” e.g., “installation of a
filtering tool at a specific location, remote from the end-
users, with customizable filtering features specific to each
end user” (see Bascom, 827 F.3d at 1352, 1350); or
(3) “entail[] an unconventional technological solution ([e.g.,]
enhancing data in a distributed fashion) to a technological
problem ([e.g.,] massive record flows [that] previously
required massive databases)” and “improve the
performance of the system itself” (see Amdocs (Isr.) Ltd.
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v. Openet Telecom, Inc., 841 F.3d 1288, 1300, 1302 (Fed.
Cir. 2016)).
Similarly, as recognized by the Revised Guidance, an “inventive
concept” under Alice step 2 can also 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 2019 Revised Guidance, 84 Fed. Reg. at 56.
In this case, however, we find no element or combination of elements
recited in Appellants’ claim 1 that contains any “inventive concept” or adds
anything “significantly more” to transform the abstract concept into a patent-
eligible application. Alice, 134 S. Ct. at 2357. For example, Appellants’
abstract idea of ranking and recommending merchants is not rooted in
computer technology, and does not provide a technical solution to a
technical problem unique to the Internet, i.e., a “solution . . . necessarily
rooted in computer technology in order to overcome a problem specifically
arising in the realm of computer networks” as the claims in DDR. DDR, 773
F.3d at 1257; Final Act. 5. Rather, Appellants’ claim 1 addresses a business
problem (presenting better recommendations of merchants, e.g., restaurants)
with a business solution (recommending restaurants based on local residents’
interactions with those restaurants) rather than a technological solution.
Ans. 15, 18–19, 21; see Spec. ¶¶ 2, 4, 88–90. Appellants also have not
demonstrated their claimed generic processors and memory are able to
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perform functions that are not merely generic, as the claims in DDR. See
DDR Holdings, 773 F.3d at 1258. Appellants’ claim 1 merely recites
generic processors analyzing data and performing calculations of popularity
scores. In contrast, Bascom’s patent-eligible ordered combination of claim
limitations contains an “inventive concept [that] harnesses [a] . . . technical
feature of network technology in a filtering system by associating individual
accounts with their own filtering scheme and elements while locating the
filtering system on an ISP [(Internet Service Provider)] server.” See
Bascom, 827 F.3d at 1350. Bascom’s claimed ordered combination
“improve[s] the performance of the computer system itself” with a
“technology-based solution . . . to filter content on the Internet that
overcomes existing problems with other Internet filtering systems.” See
Bascom, 827 F.3d at 1351–52 (internal citation omitted). Appellants’
abstract idea of ranking and recommending merchants does not provide any
particular practical application as required by Bascom, or entail an
unconventional technological solution to a technological problem as
required by Amdocs. Instead, Appellants’ invention uses generically-
claimed computing elements to perform the abstract idea. Ans. 16, 19.
Although Appellants argue their claims “are dependent on the use of
computers,” “involve[] the use of computer networks,” and “constitute an
advance in computer technology, as they are directed to processing
electronic payment transaction information and data signals from a payment
network to generate merchant recommendations with improved accuracy for
display to a consumer” (see Reply Br. 2, 6), Appellants’ claim 1 does not
evidence a technological improvement to computer technology or computer
networks, or to the technology of processing electronic payment
transactions. Ans. 16, 19, 23. Instead, claim 1 implements the abstract idea
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using generic processors and memory to perform data storage and
calculating steps. As our reviewing court has observed, “after Alice, there
can remain no doubt: recitation of generic computer limitations does not
make an otherwise ineligible claim patent-eligible.” DDR Holdings, 773
F.3d at 1256 (citing Alice, 134 S.Ct. at 2358).
We also are not persuaded the claims are patent eligible because the
“[claimed] limitations . . . operate in a non-conventional and non-generic
way to process electronic payment transaction information and data signals
from a payment network” and there is no evidence “the claimed elements are
well-understood, routine, and conventional.” See Reply Br. 3, 5; App. Br.
10–11. Appellants’ Specification describes generic computing elements
performing generic data processing, storage, and display functions, and
Appellants’ claim 1 uses generic technology to perform data analysis and
calculating steps. Final Act. 3, 5; Ans. 16, 19, 21, 23; see Spec. ¶¶ 34, 47,
57–58, 66. Additionally, Appellants have not provided evidence that claim
1’s manually performable steps (of, e.g., determining residential zip codes
based on locations of cardholders’ transactions, determining a number of
unique cardholders, calculating local merchant popularity scores, and
generating a merchant list based on the scores), or the steps of storing
merchant data and zip codes, are unconventional. The claimed steps can be
manually performed, e.g., by a business analyst analyzing local economy
sectors (as represented by commerce at local merchants), and Appellants
have not explained why such manually performable techniques would be
non-conventional. “[T]he use of generic computer elements like a
microprocessor or user interface” to perform conventional computer
functions “do not alone transform an otherwise abstract idea into patent-
eligible subject matter.” FairWarning IP, LLC v. Iatric Sys., Inc., 839 F.3d
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1089, 1096 (Fed. Cir. 2016) (citing DDR Holdings, 773 F.3d at 1256); see
also 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”); Bancorp
Services, L.L.C. v. Sun Life Assurance Co. of Canada (U.S.), 687 F.3d 1266,
1278 (Fed. Cir. 2012) (“the 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.”).
Appellants also argue the claims recite significantly more than an
abstract idea because the claimed “recitations . . . [are] not widely prevalent
or in common use in the relevant industry, as the present claims are not
rejected under Sections 102 or 103.” Reply Br. 2. This improperly conflates
the test for § 101 with the separate tests for §§ 102 and 103. See, e.g.,
Genetic Techs. Ltd. v. Merial L.L.C., 818 F.3d 1369, 1376 (Fed. Cir. 2016)
(“under the Mayo/Alice framework, a claim directed to a newly discovered
law of nature (or natural phenomenon or abstract idea) cannot rely on the
novelty of that discovery for the inventive concept necessary for patent
eligibility”); 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.”). As the
Supreme Court emphasizes, “[t]he ‘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 (emphasis
added). Although the second step in the Alice/Mayo framework is termed a
search for an “inventive concept,” the analysis is not an evaluation of
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novelty or non-obviousness, but rather, 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 217–18 (quoting Mayo 566 U.S. 72–73). A novel
and nonobvious claim directed to a purely-abstract idea is, nonetheless,
patent-ineligible. See Mayo, 566 U.S. at 89–91.
Lastly, Appellants argue claim 1 is not directed to an abstract idea
because “just as in McRO, the claimed process does not ‘preempt[] all
techniques for [generating merchant recommendations] that rely on rules,’
but rather ‘requires that the rules be rendered in a specific way.’” App. Br. 9
(citing McRO, 837 F.3d at 1315). We remain unpersuaded, and note
preemption is a necessary clue for patent eligibility, but it is not sufficient
for patent eligibility. Ans. 16, 22. As the McRO court explicitly recognized,
“the absence of complete preemption does not demonstrate patent
eligibility.” See McRO, 837 F.3d at 1315 (quoting Ariosa Diagnostics, Inc.
v. Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir. 2015)). Furthermore,
“[w]here a patent’s claims are deemed only to disclose patent ineligible
subject matter” under the Alice/Mayo framework, “preemption concerns are
fully addressed and made moot.” Ariosa, 788 F.3d at 1379.
Because Appellants’ independent claims 1, 9, and 16 are directed to a
patent-ineligible abstract concept and do not recite an “inventive concept”
by providing a solution to a technical problem under the second step of the
Alice analysis, we sustain the Examiner’s § 101 rejection of independent
claims 1, 9, and 16, and their dependent claims 3, 5–8, 12–15, 17, 18, and 20
not separately argued.

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CONCLUSION
On the record before us, we conclude Appellants have not
demonstrated the Examiner erred in rejecting claims 1, 3, 5–9, 12–18, and
20 under 35 U.S.C. § 101.

DECISION
As such, we AFFIRM the Examiner’s rejection of claims 1, 3, 5–9,
12–18, and 20 under 35 U.S.C. § 101.
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