Devi Poellnitz

Patent Trials and Appeals Board

Oct 23, 2019

12854108 - (D) (P.T.A.B. Oct. 23, 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.
12/854,108 08/10/2010 Devi Poellnitz 13014-3 7133
94884 7590 10/23/2019
Ellenoff Grossman & Schole LLP
Attn: James Smedley and Alex Korona
1345 Avenue of the Americas
15th Floor
New York, NY 10105
EXAMINER
OBEID, MAMON A
ART UNIT PAPER NUMBER
3685
NOTIFICATION DATE DELIVERY MODE
10/23/2019 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):
Mpolychronides@egsllp.com
akorona@egsllp.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________

Ex parte DEVI POELLNITZ
____________

Appeal 2018-005916
Application 12/854,1081
Technology Center 3600
_______________

Before HUNG H. BUI, NABEEL U. KHAN, and MICHAEL M. BARRY,
Administrative Patent Judges.

BUI, Administrative Patent Judge.

DECISION ON APPEAL
Appellant seeks our review under 35 U.S.C. § 134(a) from the
Examiner’s Final Rejection of claims 20 and 26–32, which are all the claims
pending in the application. Claims App. We have jurisdiction under
35 U.S.C. § 6(b).
We AFFIRM.2

1 We use the word “Appellant” to refer to “applicant(s)” as defined in 37
C.F.R. § 1.42. The real party in interest is Devi Poellnitz. App. Br. 3.
2 Our Decision refers to Appellant’s Appeal Brief (“App. Br.”) filed January
26, 2018; Examiner’s Answer (“Ans.”) mailed March 21, 2018; Final Office
Action (“Final Act.”) mailed July 14, 2017; and original Specification
(“Spec.”) filed August 10, 2010.
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STATEMENT OF THE CASE
Appellant’s invention relates to “a referral system and method for
promoting, networking and selling music, operated by at least one artist
[registered in the website] and at least one participant, in which the
participant uses a social networking website which facilitates the participant
to access a plurality of means to obtain income by referring other
participants.” Spec. ¶ 7. According to Appellant, “[t]he participant may be
an artist or a fan of the artist” and “can sign up into the website and pays a
fee to purchase music or other media from other artists in the website” such
that “[a] portion of the income will be distributed to the artists, and a
percentage from the portion of the income will be earned by the system,”
“[i]ncome generated by each artist depends on the number of participants
who join the referral system” and “[f]ans can earn income through referrals.”
Abstract. “In sum, the referral system provides income to artists who join
the system through fees of new artists referred to the system, and each artist
receives income from the support of its artist supporters who invite others to
support the artist.” Spec. ¶ 39.
Claim 20—the only independent claim on appeal—is illustrative of
Appellant’s invention, and is reproduced below:
20. A computer implemented method of promoting and
financing artists via a computer network, comprising the steps of
causing at least one processor to execute a set of computer
executable instructions for:
providing a social networking website;
generating an interface in said social networking website
for artists and/or supporting participants of an artist to register
with the website thereby becoming registered members, and
allows said artists to upload their musical work;
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generating an interface in said social networking website
that allows a registered member to browse music by registered
artist, song title and/or genre and select a music file for purchase
and download;
generating a registered members account area in said
social networking website, said registered members account area
indicates: whether a registered member has downloaded any
music and a total number of times another member has
downloaded music uploaded by said registered member;
generating an interface that is used by a registered member
to invite others to join said social networking website, wherein
once registered said others can upload a musical work they
produced and/or support one or more registered artists by
purchasing and downloading a musical work of said registered
artists; and
generating a data structure in the form of a hierarchical tree
with a plurality of data nodes, wherein each data node contains
an identifier associated with each registered artist and one or
more registered supporting participants of said registered artist,
wherein a parent node identifies a referring party who referred
each registered artist, wherein each registered artist is identified
in a child node of a referring party node, wherein each registered
supporting participant must purchase music of any artist they
support as well as music of artists identified in one or more parent
nodes of the node containing the supporting participant
identifier, at successively higher levels of the tree, and wherein
each registered artist must purchase music of artists identified in
one or more parent nodes of the node containing the registered
artist identifier, at successively higher levels of the tree.
App. Br. 15–16 (Claims App.).

EXAMINER’S REJECTIONS
(1) Claims 20 and 26–32 stand rejected under 35 U.S.C. § 101
because the claimed invention is directed to an abstract idea without
significantly more. Final Act. 2–6.
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(2) Claims 20 and 26–32 stand rejected under 35 U.S.C. § 112(b)
or 35 U.S.C. § 112 (pre-AIA) second paragraph, as being indefinite. Final
Act. 6–7.

ANALYSIS
35 U.S.C. § 101
In support of the § 101 rejection of claims 20 and 26–32, the
Examiner determines Appellant’s claims are directed to “promoting and
financing artists, which is a fundamental economic practice and a method of
organizing human activities and thus, an abstract idea.” Final Act. 3; Ans. 3.
According to the Examiner, the limitations recited in claim 20 “can [also] be
performed mentally (or by a human using a pen and paper).” Final Act. 4.
The Examiner then determines the additional elements (i.e., “data
structure in the form of a hierarchical tree with a plurality of data nodes,
wherein each data node contains identifier associated with each registered
artist and one or more registered supporting participants of said registered
artist”) when analyzed individually and as an ordered combination, do not
amount to significantly more than the abstract idea because these additional
elements (1) are “recited at a high level of generality, and [] require a
computer . . . to simply perform the generic computer functions of
generating, identifying, referring & purchasing”; (2) are “generic features”
as acknowledged by Appellant’s own Specification (emphasis omitted)
(Spec. ¶ 62); (3) do not improve “the functioning of [a] computer [] [or]
another technology or technical field”; and (4) “perform generic computer
functions that are well-understood, routine and conventional.” Final Act. 4–
6.
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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,
internal quotation marks omitted).
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).
In an effort to achieve clarity and consistency in how the U.S. Patent
and Trademark Office (the “Office”) applies the Supreme Court’s two-step
framework, the Office recently published revised guidance interpreting
governing case law and establishing a prosecution framework for all patent-
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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”).
2019 Revised Guidance
Under the 2019 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—concepts performed in the human
mind (including an observation, evaluation, judgment,
opinion), 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

3 All references to the MPEP are to the Ninth Edition, Revision 08.2017
(rev. Jan. 2018).
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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.
In the briefing, Appellant refers to prior USPTO guidance regarding
§ 101, including, for example: July 2015 Update on Subject Matter
Eligibility, 80 Fed. Reg. 45,429 (July 30, 2015) (“the 2015 Update”). App.
Br. 5. However, the 2015 Update as well as other guidance, including: (1)
2014 Interim Guidance on Patent Subject Matter Eligibility, 79 Fed. Reg.
74,618 (December 16, 2014); (2) May 2016 Subject Matter Eligibility
Update, 81 Fed. Reg. 27,381 (May 6, 2016); and (3) Memorandum on
Subject Matter Eligibility Decisions dated Nov. 2, 2016, have been
superseded by the 2019 Revised Guidance. See 2019 Revised Guidance, 84
Fed. Reg. at 52. As such, our analysis will not address the sufficiency of the
Examiner’s rejection against the cited prior guidance. Rather, our analysis
will comport with the 2019 Revised Guidance as discussed below.
Alice/Mayo—Step 1 (Abstract Idea)
Step 2A–Prongs 1 and 2 identified in the Revised Guidance
Step 2A—Prong 1
Appellant does not dispute the Examiner’s determination that claims
20 and 26–32 recite “a fundamental economic practice” or “mental
processes.” Final Act. 3. Instead, Appellant argues (1) “the Examiner
mischaracterizes the claims and over simplifies the invention by stating that
the claims are directed to a fundamental economic practice and a method of
organizing human activity” (Reply Br. 11), and (2) claim 20 “does not
describe a method of promoting/financing artists that can be performed
mentally (or by a human using a pen and paper),” but rather “recites multiple
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steps for generating user interfaces in the context of a social media site, and
generating a data structure type that defines relationships and obligations
between referring parties, registered artists, and registered supporting
participants.” App. Br. 5–6. For example, claim 20 recites, inter alia,
generating a data structure in the form of a hierarchical tree with
a plurality of data nodes, wherein each data node contains an
identifier associated with each registered artist and one or more
registered supporting participants of said registered artist,
wherein a parent node identifies a referring party who referred
each registered artist, wherein each registered artist is identified
in a child node of a referring party node, wherein each registered
supporting participant must purchase music of any artist they
support as well as music of artists identified in one or more parent
nodes of the node containing the supporting participant
identifier, at successively higher levels of the tree, and wherein
each registered artist must purchase music of artists identified in
one or more parent nodes of the node containing the registered
artist identifier, at successively higher levels of the tree.
App. Br. 6. According to Appellant, “Claim 20 recites generating different
computer interfaces for facilitating artist interactions and selling original
musical works, as well as a unique type of data structure for defining
relationships and obligations between different types of members,” whereas
“an ordinary data structure simply holds data that can be accessed and
manipulated by traversing the nodes in the data structure.” App. Br. 6;
Reply Br. 12.
Appellant’s arguments are not persuasive. At the outset, we note
Appellant’s Specification and claims describe “a referral system and method
for promoting, networking and selling music, operated by at least one artist
[registered in the website] and at least one participant, in which the
participant uses a social networking website which facilitates the participant
to access a plurality of means to obtain income by referring other
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participants.” Spec. ¶ 7. This way, “the referral system provides income to
artists who join the system through fees of new artists referred to the system,
and each artist receives income from the support of its artist supporters who
invite others to support the artist.” Spec. ¶ 39.
For example, Appellant’s claim 20 recites a “computer implemented
method of promoting and financing artists via a computer network”
equipped with “at least one processor to execute a set of computer
executable instructions for:”
[1] providing a social networking website;

[2] generating an interface in said social networking website
for artists and/or supporting participants of an artist to register
with the website thereby becoming registered members, and
allows said artists to upload their musical work;

[3] generating an interface in said social networking website
that allows a registered member to browse music by registered
artist, song title and/or genre and select a music file for purchase
and download;

[4] generating a registered members account area in said
social networking website, said registered members account area
indicates: whether a registered member has downloaded any
music and a total number of times another member has
downloaded music uploaded by said registered member; and

[5] generating an interface that is used by a registered member
to invite others to join said social networking website, wherein
once registered said others can upload a musical work they
produced and/or support one or more registered artists by
purchasing and downloading a musical work of said registered
artists; and

[6] generating a data structure in the form of a hierarchical tree
with a plurality of data nodes, wherein each data node contains
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an identifier associated with each registered artist and one or
more registered supporting participants of said registered artist,
wherein a parent node identifies a referring party who referred
each registered artist, wherein each registered artist is identified
in a child node of a referring party node, wherein each registered
supporting participant must purchase music of any artist they
support as well as music of artists identified in one or more parent
nodes of the node containing the supporting participant
identifier, at successively higher levels of the tree, and wherein
each registered artist must purchase music of artists identified in
one or more parent nodes of the node containing the registered
artist identifier, at successively higher levels of the tree.
App. Br. 15–16 (Claims App.) (bracketing added).
These limitations of Appellant’s claim 20, under their broadest
reasonable interpretation, recite a method of promoting and financing artists
by way of an interface in a social networking website to allow artists and
supporters of an artist to (1) register and upload content (musical work); (2)
browse music by registered artist, song title and/or genre and select a music
file for purchase and download; (3) invite others to join and upload content
(musical work they produced) and/or support registered artists by purchasing
and downloading a musical work of the registered artists; and (4) share
income, via referrals, i.e., “a data structure in the form of a hierarchical tree
with a plurality of data nodes,” which is a known promotional and financial
activity and a fundamental economic practice in our system of commerce.
Ans. 3; see Spec. ¶¶ 7–8, 38–39; Figures 1, 9.
Such activities are squarely within the realm of abstract ideas, like
(1) the risk hedging in Bilski v. Kappos, 561 U.S. 593 (2010); (2) the
intermediated settlement in Alice, 573 U.S. at 220; (3) verifying credit card
transactions in CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d 1366,
1370 (Fed. Cir. 2011); (4) guaranteeing transactions in buySAFE, Inc. v.
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Google, Inc., 765 F.3d 1350, 1354 (Fed. Cir. 2014); (5) distributing products
over the Internet in Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709 (Fed. Cir.
2014); (6) determining a price of a product offered to a purchasing
organization in Versata Dev. Grp., Inc. v. SAP Am., Inc., 793 F.3d 1306
(Fed. Cir. 2015); and (7) pricing a product for sale in OIP Techs., Inc. v.
Amazon.com, Inc., 788 F.3d 1359 (Fed. Cir. 2015). Promoting, selling
music and then sharing income from selling music among entities (i.e.,
artists and supporters), whether in person or online, is a basic 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 220.
Alternatively, as correctly recognized by the Examiner, promoting,
selling music and then sharing income from selling music among entities
(i.e., artists and supporters), whether in person or online, are nothing more
than a series of “mental processes” that could also be performed in the
human mind or by a human using a pen and paper—a subject matter that
falls within the three groupings of abstract ideas identified in the Revised
Guidance. See CyberSource, 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.”); see also In re Comiskey, 554 F.3d 967, 979
(Fed. Cir. 2009) (“[M]ental processes—or processes of human thinking—
standing alone are not patentable even if they have practical application.”);
Gottschalk v. Benson, 409 U.S. 63, 67 (1972) (“Phenomena of nature, . . .
mental processes, and abstract intellectual concepts are not patentable, as
they are the basic tools of scientific and technological work.” (emphasis
added)). Additionally, mental processes remain unpatentable even when
automated to reduce the burden on the user of what once could have been
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done with pen and paper. CyberSource, 654 F.3d at 1375 (“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.”).
We, therefore, conclude limitations (1)–(6) in Appellant’s claim 20
recite promoting, selling music and then sharing income from selling music
among entities (i.e., artists and supporters), which is “a fundamental
economic practice” and/or “mental processes” as identified in the Revised
Guidance, and, thus, an abstract idea. See 2019 Revised Guidance (Revised
Step 2A, Prong One), 84 Fed. Reg. at 52, 54.
Step 2A—Prong 2 (Integration into Practical Application)
Under Revised Step 2A, Prong Two of the Revised Guidance, we must
determine if the claims (i.e., additional limitations beyond the judicial
exception) integrate the judicial exception into a practical application.
However, we discern no additional element (or combination of elements)
recited in Appellant’s claim 20 and its dependent claims 26–32 that
integrates the judicial exception into a practical application. See Revised
Guidance, 84 Fed. Reg. at 54–55 (“Prong Two”).
For example, Appellant’s additional elements (i.e., processor,
interface, website, and “data structure in the form of a hierarchical tree with
a plurality of data nodes”) recited in claim 20 do not (1) improve the
functioning of a computer or other technology, (2) are not applied with any
particular machine (except for generic computer components), (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
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claim as a whole is more than a drafting effort designed to monopolize the
exception. See MPEP §§ 2106.05(a)–(c), (e)–(h).
Appellant appears to argue the use of (1) “computer interfaces for
facilitating artist interactions” and (2) “data structure for defining
relationships and obligations between different types of members”
constitutes some sort of technological improvement. App. Br. 6.
We do not agree. There is no support from Appellant’s Specification
for any feature that would improve any existing graphical user interface
technology (or any other computer or software technology) or would
overcome any problem arising in graphical user interfaces. Instead,
Appellant’s claims seek to utilize generic computer interfaces as a tool, as
shown in Appellant’s Figures 1–6, to perform the recited abstract idea.
Likewise, Appellant’s claims utilize existing relationships between artists
and participants (artist supporters) to ensure, as expressly described by
Appellant’s Specification, that “income [is delivered] to artists who join the
system through fees of new artists referred to the system, and each artist
receives income from the support of its artist supporters who invite others to
support the artist.” Spec. ¶ 39. For example, Appellant’s Figure 9 shows
how existing relationships between artists and participants (artist supporters)
can be identified to share income, as reproduced below.
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Appellant’s Figure 9 shows “an example of the referral system and the
manner in which the system generates income to the participant.” Spec.
¶ 22.
[As shown in Figure 9] [e]ach participant, or artist supporter, will
buy and download one song each for a total of five songs. For
example, Artist B purchases a song from Artist A for 10 cents.
Artist F purchases a song from Artist B and A, but not from
Artists C, D, and E. However, Artist I purchases one song from
Artist H, one song from Artist B, and one song from Artist A.
Artist O purchases one song from Artist I, one song from Artist
H, one song from Artist B, and one song from Artist A.

Spec. ¶ 38. This way “income [is delivered] to artists who join the system
through fees of new artists referred to the system, and each artist receives
income from the support of its artist supporters who invite others to support
the artist.” Spec. ¶ 39.
Contrary to Appellant’s argument, the use of existing relationships
between artists and participants (artist supporters) to share income, via a data
structure recited in claim 20, is insufficient to show “integration into a
practical application.” See MPEP § 2106.05(f). Instead, these generic
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computer components are simply the “automation of the fundamental
economic concept.” OIP Techs., 788 F.3d at 1362–63. “[M]erely
requir[ing] generic computer implementation,” “does not move into [§] 101
eligibility territory.” buySAFE, 765 F.3d at 1354 (second alteration in
original).
For business-centric inventions such as Appellant’s invention
involving promoting, selling music and then sharing income from selling
music among entities (i.e., artists and supporters), the “integration into a
practical application” prong requires consideration of whether the claims
purport to provide “a technical solution to a technical problem” as required
by the Federal Circuit’s precedential decisions in (1) DDR Holdings, LLC v.
Hotels.com, L.P., 773 F.3d 1245, 1257 (Fed. Cir. 2014) and (2) Amdocs
(Isr.) Ltd. v. Openet Telecom, Inc., 841 F.3d 1288 (Fed. Cir. 2016). See
MPEP § 2106.05(a).
For example, the Federal Circuit found DDR’s claims are patent-
eligible under § 101 because DDR’s claims: (1) do not merely recite “the
performance of some business practice known from the pre-Internet world”
previously disclosed in Bilski and Alice; but instead (2) 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.” DDR, 773 F.3d at
1257. Likewise, the Federal Circuit also found Amdocs’ claims patent-
eligible under § 101 because, like DDR, Amdocs’ claims “entail[] an
unconventional technological solution (enhancing data in a distributed
fashion) to a technological problem (massive record flows which previously
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required massive databases)” and “improve the performance of the system
itself.” Amdocs, 841 F.3d at 1300, 1302.
Contrary to Appellant’s argument, promoting, selling music and then
sharing income from selling music among entities (i.e., artists and
supporters) does not provide any “technical solution to a technical problem”
as contemplated by the Federal Circuit in DDR and Amdocs. See MPEP
§ 2106.05(a). For example, Appellant’s claimed promoting, selling music
and then sharing income from selling music among entities (i.e., artists and
supporters) 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.” DDR, 773 F.3d at 1257. Nor does Appellant’s
invention entail, like Amdocs, any “unconventional technological solution
(enhancing data in a distributed fashion) to a technological problem
(massive record flows which previously required massive databases)” and
“improve the performance of the system itself.” Amdocs, 841 F.3d at 1300,
1302. The focus of Appellant’s invention is not to improve the performance
of computers or any underlying technology; instead, the focus is to use
generic computer components (e.g., interfaces and data structures) as a tool
to ensure that “income [is delivered] to artists who join the system through
fees of new artists referred to the system, and each artist receives income
from the support of its artist supporters who invite others to support the
artist.” Spec. ¶ 39.
A claim for a new abstract idea is still an abstract idea. See Synopsys,
Inc. v. Mentor Graphics Corp., 839 F.3d 1138, 1151 (Fed. Cir. 2016). “No
matter how much of an advance in the finance field the claims recite, the
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advance lies entirely in the realm of abstract ideas, with no plausibly alleged
innovation in the non-abstract application realm.” See SAP Am., Inc. v.
InvestPic, LLC, 898 F.3d 1161, 1163 (Fed. Cir. 2018).
For these reasons, we are not persuaded that Appellant’s “additional
elements” recited in claims 20 and 26–32 integrate the abstract idea into a
practical application.
Alice/Mayo—Step 2 (Inventive Concept)
Step 2B identified in the Revised Guidance
Under the 2019 Revised Guidance, only if a claim: (1) recites a
judicial exception, and (2) does not integrate that exception into a practical
application, do we then look to whether the claim adds a specific limitation
beyond the judicial exception that is not “well-understood, routine,
conventional” in the field (see MPEP § 2106.05(d)); or, simply appends
well-understood, routine, 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. However, we find no
element or combination of elements recited in Appellant’s claims 20 and 26–
32 that contain any “inventive concept” or add anything “significantly more”
to transform the abstract concept into a patent-eligible application. Alice,
573 U.S. 208 at 221.
Appellant argues the use of (1) “computer interfaces for facilitating
artist interactions” and (2) “data structure for defining relationships and
obligations between different types of members” amounts to significantly
more than an abstract idea because Appellant’s claim 20 generates (1)
“specific computer interfaces that allow artists and supporters to interact and
acquire or sell their music”; and (2) “a special data structure is used to track
and define relationships and obligations between referring parties, artists and
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supporting participants.” App. Br. 6–12. Appellant also argues, like the
claims in BASCOM Glob. Internet Servs., Inc. v. AT&T Mobility LLC, 827
F.3d 1341 (Fed. Cir. 2016):
“[t]he claimed inventive device and method in Applicant’s
claims has a specific technological application in that it enables
a member to efficiently upload their music or browse new
original music produced by other members, while tracking the
number of times a musical work is downloaded, and defining
relationships/obligations between members” and, as such,
“improve an existing technological process.”

App. Br. 12.
However, Appellant’s arguments are not persuasive. Utilizing generic
computer components (e.g., interfaces and “data structure”) in a network
does not alone transform an otherwise abstract idea into patent-eligible
subject matter. 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, 773 F.3d at 1256
(citing Alice, 573 U.S. at 222).
Appellant’s reliance on BASCOM is also misplaced. For example,
BASCOM (U.S. Patent No. 5,987,606 (“BASCOM ’606 patent”)) describes a
particular arrangement of filtering software at a specific location, remote
from the end-users, with customizable filtering features specific to each end
user. The filtering software enables individually customizable filtering at
the remote ISP server by taking advantage of the technical ability of the ISP
server to identify individual accounts and associate a request for Internet
content with a specific individual account. BASCOM ’606 patent, 4:35–38.
The Federal Circuit recognized that BASCOM’S installation of an
Internet content filter at a particular network location is “a technical
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improvement over prior art ways of filtering such content” because such an
arrangement advantageously allows the Internet content filter to have “both
the benefits of a filter on a local computer and the benefits of a filter on the
ISP server” and “give[s] users the ability to customize filtering for their
individual network accounts.” BASCOM, 827 F.3d at 1350, 1352.
According to the Federal Circuit, BASCOM’S claims “do not preempt the
use of the abstract idea of filtering content on the Internet or on generic
computer components performing conventional activities.” Id. at 1352.
Instead, BASCOM’S claims “carve out a specific location for the filtering
system (a remote ISP server) and require the filtering system to give users
the ability to customize filtering for their individual network accounts.” Id.
As such, “an inventive concept can be found in the non-conventional and
non-generic arrangement of known, conventional pieces.” Id. at 1350.
In contrast to BASCOM, Appellant’s claims and Specification are
directed to “a referral system and method for promoting, networking and
selling music, operated by at least one artist [registered in the website] and at
least one participant, in which the participant uses a social networking
website which facilitates the participant to access a plurality of means to
obtain income by referring other participants” in order to “provide[] income
to artists who join the system through fees of new artists referred to the
system, . . . [where] each artist receives income from the support of its artist
supporters who invite others to support the artist.” Spec. ¶¶ 7, 39; Abstract.
There is no evidence in the record to support the contention that Appellant’s
claimed system is provided with any non-conventional and non-generic
arrangement of known, conventional components similar to BASCOM.
Likewise, there is no element or combination of elements recited in
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Appellant’s claim 20 that contains any “inventive concept” or adds anything
“significantly more” to transform the abstract concept into a patent-eligible
application. Alice, 573 U.S. 208 at 221.
Preemption
Lastly, Appellant argues the claims do not “seek to tie up a judicial
exception such as a fundamental economic principle or method of
organizing human activity” because (1) “[t]here are numerous ways of
promoting and financing artists that may still be used without infringing on”
the claims, and (2) “there are literally thousands of other ways in which
others may promote and finance artists without reading upon the present
claims.” App. Br. 7.
We do not agree. The lack of preemption is a necessary clue for
patent eligibility, but it is not sufficient for patent eligibility. As the McRO
court explicitly recognized, “the absence of complete preemption does not
demonstrate patent eligibility.” See McRO, Inc. v. Bandai Namco Games
Am. Inc., 837 F.3d 1299, 1315 (Fed. Cir. 2016) (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 Appellant’s independent claim 20 is directed to a patent-
ineligible abstract concept and does not recite an “inventive concept” or
provide a solution to a technical problem under the second step of the Alice
analysis, we sustain the Examiner’s § 101 rejection of independent claim 20
and its dependent claims 26–32 not separately argued.

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35 U.S.C. § 112, second paragraph
Claim 20 recites, inter alia:
generating a data structure in the form of a hierarchical tree with
a plurality of data nodes, wherein each data node contains an
identifier associated with each registered artist and one or more
registered supporting participants of said registered artist,
wherein a parent node identifies a referring party who referred
each registered artist, wherein each registered artist is identified
in a child node of a referring party node, wherein each registered
supporting participant must purchase music of any artist they
support as well as music of artists identified in one or more parent
nodes of the node containing the supporting participant
identifier, at successively higher levels of the tree, and wherein
each registered artist must purchase music of artists identified in
one or more parent nodes of the node containing the registered
artist identifier, at successively higher levels of the tree.
App. Br. 15–16 (Claim App.) (emphasis added).
In support of the § 112, second paragraph rejection of claim 20 and its
dependent claims 26–32, the Examiner finds the term “successively higher
levels of the tree” recited in claim 20 indefinite because (1) that term is not
defined by the claim or Appellant’s Specification, and (2) “one of ordinary
skill in the art would not be reasonably apprised of the scope of the
invention.” Final Act. 6–7.
Appellant argues “if the phrase is read in the context of FIG. 9 it
becomes clear what successively higher levels of the tree means” and “the
phrase should be given its plain and ordinary meaning.” App. Br. 13.
We agree. Whether a claim is indefinite is an issue of law. Credle v.
Bond, 25 F.3d 1566, 1576 (Fed. Cir. 1994). The second paragraph of 35
U.S.C. § 112, requires that a patent’s claims, viewed in light of the
specification and prosecution history, inform those skilled in the art about
the scope of the invention with reasonable certainty. See Nautilus, Inc. v.
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Biosig Instruments, Inc., 572 U.S. 898, 910–11 (2014). “[A] patent must be
precise enough to afford clear notice of what is claimed, thereby apprising
the public of what is still open to them.” Id. at 909 (quotations and brackets
omitted). Indefiniteness is to be evaluated from the perspective of a person
with ordinary skill in the relevant art at the time of the invention—when the
patent application was filed. Id. at 908.
Our reviewing court has previously applied a standard consistent with
that of Nautilus in the examination context. See In re Warmerdam, 33 F.3d
1354, 1361 (Fed. Cir. 1994) (“The legal standard for definiteness is whether
a claim reasonably apprises those of skill in the art of its scope.”). In
addition, our reviewing court stated that “[i]t is the applicants’ burden to
precisely define the invention, not the PTO’s.” In re Morris, 127 F.3d 1048,
1056 (Fed. Cir. 1997).
The Specification describes that when a participant receives an
invitation to the website from an artist, the “participant can obtain music
from the artist . . . and a selected number of artists hierarchically above the
artist who recruited/referred the participant by paying a fee for the music
obtained.” Spec. ¶¶ 8, 26. This allows the participant to upload his or her
own music to the website. Spec. ¶ 8, 26.
The Specification provides at least two examples illustrating the
above concept. In a first example, the Specification describes participants
A, B, and C, where A refers B to the website and B refers C to the website.
Spec. ¶ 27. When C joins the website, C is required to purchase one song
from B and one song from A. Spec. ¶ 27. Figure 9 of the Specification
provides a second example. As explained above, in Figure 9, participant O,
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“purchases one song from Artist I, one song from Artist H, one song from
Artist B, and one song from Artist A.” Spec. ¶ 38.
In light of these disclosures, one of ordinary skill in the art would
understand that participant C from the first example, purchases songs from
artists at “successively higher levels of the tree” (i.e. from artists B and A).
Similarly, one of ordinary skill would understand that participant O from the
second example, purchases songs from artists at “successively higher levels
of the tree” (i.e. artists I, H, B, and A). Thus, although we agree with the
Examiner that the phrase “successively higher levels of the tree” is a relative
term, we do not agree that such a term is indefinite in light of Appellant’s
Specification.
For these reasons, we do not sustain the Examiner’s rejection of
claims 20 and 26–32 under 35 U.S.C. § 112, second paragraph, as being
indefinite.

CONCLUSION
On the record before us, we conclude Appellant has not demonstrated
the Examiner erred in rejecting claims 20 and 26–32 under 35 U.S.C. § 101,
but has demonstrated the Examiner erred in rejecting claims 20 and 26–32
under 35 U.S.C. § 112, second paragraph.

DECISION
As such, we AFFIRM the Examiner’s rejection of claims 20 and 26–
32 under 35 U.S.C. § 101, but REVERSE the Examiner’s rejection of claims
20 and 26–32 under 35U.S.C. § 112, second paragraph.

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DECISION SUMMARY
Claims
Rejected
35 U.S.C.§ Basis Affirmed Reversed
20 and 26–32 101 20 and 26–
32

20 and 26–32 112, second
paragraph
Indefiniteness 20 and 26–
32
Overall Outcome 20 and 26–
32

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