Ex Parte Asher et al

Patent Trial and Appeal Board

Jun 13, 2018

11968390 (P.T.A.B. Jun. 13, 2018)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE
11/968,390 01/02/2008
63710 7590 06/15/2018
INNOVATION DIVISION
CANTOR FITZGERALD, L.P.
110 EAST 59TH STREET (6TH FLOOR)
NEW YORK, NY 10022
FIRST NAMED INVENTOR
Joseph M. Asher
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
ATTORNEY DOCKET NO. CONFIRMATION NO.
04-6192-Cl 8858
EXAMINER
WILLIAMS, ROSS A
ART UNIT PAPER NUMBER
3714
NOTIFICATION DATE DELIVERY MODE
06/15/2018 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):
patentdocketing@cantor.com
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PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte JOSEPH M. ASHER and HOW ARD W. LUTNICK
Appeal2017-004597
Application 11/968,390 1
Technology Center 3700
Before ANTON W. PETTING, JOSEPH A. FISCHETTI, and
PHILIP J. HOFFMANN, Administrative Patent Judges.
HOFFMANN, Administrative Patent Judge.
DECISION ON APPEAL
STATEMENT OF THE CASE
Pursuant to 35 U.S.C. § 134(a), Appellants appeal from the
Examiner's rejection of claims 1-8, 17-20, and 22-33. We have jurisdiction
under 35 U.S.C. § 6(b ).
We AFFIRM.
1 According to Appellants, "[t]he real party in interest ... is CFPH, L.P."
Appeal Br. 3.
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Application 11/968,390
According to Appellants, the invention is directed "to a system and
method for ... wagering." Spec. ,r 1. Claims 1, 17, and 29 are the
independent claims on appeal. We reproduce claim 1, below, as illustrative
of the appealed claims.
1. An apparatus comprising:
at least one processing device; and
at least one non-transitory medium having stored thereon
a plurality of instructions that when executed by the at least one
processing device cause the apparatus:
receive a first bet on a wagering event;
after receiving the first bet, receive a second bet on
the wagering event;
determine that the second bet is received during a
predetermined period of time after the first bet is received;
based at least in part on determining that the second
bet is received during the predetermined period of time,
recalculate betting odds for the wagering event based at
least in part on the first bet and the second bet; and
cause the recalculated betting odds to be conveyed
to at least one bettor.
REJECTION
The Examiner rejects claims 1-8, 17-20, and 22-33 under 35 U.S.C.
§ 101 as ineligible subject matter.
ANALYSIS
An invention is patent-eligible if it claims a "new and useful process,
machine, manufacture, or composition of matter." 35 U.S.C. § 101. The
Supreme Court, however, has long interpreted § 101 to include an implicit
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exception: "[l]aws of nature, natural phenomena, and abstract ideas" are not
eligible for patenting. See, e.g., Alice Corp. Pty. Ltd. v. CLS Bank Int 'l,
134 S. Ct. 2347, 2354 (2014).
The Supreme Court, in Alice, reiterated the two-step analysis
previously set forth in Mayo Collaborative Services v. Prometheus
Laboratories, Inc., 566 U.S. 66 (2012), "for distinguishing patents that claim
laws of nature, natural phenomena, and abstract ideas from those that claim
patent-eligible applications of those concepts." Alice Corp., 134 S. Ct.
at 2355. The first step in that analysis is to "determine whether the claims at
issue are directed to one of those patent-ineligible concepts." Id. If the
claims are not directed to a patent-ineligible concept, e.g., an abstract idea,
the inquiry ends. Otherwise, the inquiry proceeds to the second step, where
the elements of the claims are considered "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." Alice
Corp., 134 S. Ct. at 2355 (quoting Mayo, 566 U.S. at 79, 78).
Regarding the first step of the analysis, the Supreme Court
acknowledged, in Mayo, that "all inventions at some level embody, use,
reflect, rest upon, or apply laws of nature, natural phenomena, or abstract
ideas." Mayo, 566 U.S. at 71. Therefore, we look to whether the claims
focus on a specific means or method that improves the relevant technology,
or instead whether the claims are directed to a result or effect that itself is the
abstract idea, and merely invoke generic processes and machinery. See
Enfzsh, LLC v. Microsoft Corp., 822 F.3d 1327, 1336 (Fed. Cir. 2016).
Initially, we note that Appellants argue all of the claims as a group.
See Appeal Br. 6-10. We choose independent claim 1 for our analysis, and
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each of the remaining claims stands or falls with claim 1. See 37 C.F.R.
§ 4I.37(c)(l)(iv).
With respect to the Examiner's rejection of the claims under § 101,
the Examiner determines that "[t]he claimed abstract idea may be viewed,
for example, as ... a fundamental economic practice ( e.g., rules for
calculating wagering odds based on submitted wagers) [,] ... a method of
managing a game (e.g., wagering events)[,] ... and/or ... a method of
organizing human activities." Answer 4 ( citations omitted); see also id.
at 4--5. The Examiner also determines that the claims fails to recite
additional elements that transform the claim into a patent-eligible
application, stating that although the claims recite "numerous" "additional
features" (id. at 5), "[t]hese features merely recite generic and conventional
features of virtually all electronic wagering environments" (id. at 6).
Based on our review, we agree with the Examiner's findings and
conclusions regarding the claims, as set forth above. Conversely, we are not
persuaded of Examiner error by any of Appellants' arguments. See Appeal
Br. 6-10. Thus, we sustain the Examiner's§ 101 rejection of claims 1-8,
17-20, and 22-33.
Specifically, Appellants argue that the rejection is in error because
the Examiner makes a factual finding [ that the claims are directed
to an abstract idea] without any evidence[,] in clear violation of
the [ A ]dministrative [P]rocedure [ A ]ct[']s requirement for
substantial evidence to make such factual findings. Even the
Supreme Court in ... Alice ... provided evidence of abstractness
in the form of the text book from 1986. Here, the Examiner
provides no evidence at all. No evidence cannot possibly meet
the requirements of substantial evidence.
Appeal Br. 7 ( emphasis added). This argument is not persuasive, however.
First, we note that Appellants do not provide any citation to the
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Administrative Procedure Act, including a citation to anything indicating
that the Examiner's conclusion that the claims are directed to an abstract
idea must be supported by substantial evidence. Similarly, Appellants do
not provide a citation to any case law indicating that the Examiner must
provide evidentiary support before concluding that a claim is directed to an
abstract idea. Although evidence may be helpful, for example, where facts
are in dispute, evidence is not always needed. See USPTO's June 25, 2014
"Preliminary Examination Instructions in view of the Supreme Court
Decision in Alice Corporation Pty. Ltd. v. CLS Bank International, et al.";
see also, e.g., para. IV "July 2015 Update: Subject Matter Eligibility" to
2014 Interim Guidance on Subject Matter Eligibility (2014 IEG), 79 Fed.
Reg. 74618 (Dec. 16, 2014) ("The courts consider the determination of
whether a claim is eligible (which involves identifying whether an exception
such as an abstract idea is being claimed) to be a question of law.
Accordingly, courts do not rely on evidence that a claimed concept is a
judicial exception, and in most cases resolve the ultimate legal conclusion on
eligibility without making any factual findings." ( emphasis added) ( footnote
omitted)).
In this case, as in Alice, we need not labor to delimit the precise
contours of the "abstract ideas" category. It is enough to recognize that
there is no meaningful distinction in the level of abstraction between the
concept of risk hedging in Bilski and the concept of receiving bets on a
wagering event and conveying recalculated odds resulting from the bets at
issue here. Both are squarely within the realm of "abstract ideas" as the
Court has used that term. See Alice Corp., 134 S. Ct. at 2357.
Further, claims that essentially only recite steps directed to data
collection, analysis, and display, such as recited in Appellants' claim 1, are
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directed to an abstract idea. Elec. Power Grp. v. Alstom S.A., 830 F.3d 1350,
1353 (Fed. Cir. 2016) (holding that "collecting information, analyzing it, and
displaying certain results of the collection and analysis" are "a familiar class
of claims 'directed to' a patent ineligible concept"); see also In re TL!
Commc 'ns LLC Patent Litig., 823 F.3d 607, 611 (Fed. Cir. 2016);
FairWarning IP, LLC v. Iatric Sys., Inc., 839 F.3d 1089, 1093-94
(Fed. Cir. 2016). Further, Appellants' claim 1, unlike claims found patent
eligible in prior cases, uses generic computer technology (i.e., "a processor"
and "a non-transitory medium" (Appeal Br, Claims App. (Claim 1 ))) to
receive bets and convey recalculated odds based on the bets, and does not
recite an improvement to a particular computer technology. See, e.g.,
McRO, Inc. v. Bandai Namco Games Am. Inc., 837 F.3d 1299, 1314--15
(Fed. Cir. 2016) (finding claims not abstract because they "focused on a
specific asserted improvement in computer animation"). As such,
Appellants' claim 1 is "directed to" an abstract idea in accordance with the
first step of the Alice analysis. Alice Corp., 134 S. Ct. at 2355.
Appellants argue that the rejection is in error because "the Examiner
presents no evidence" that the claim is directed to "a fundamental economic
practice long prevalent in our system of commerce." Appeal Br. 7.
Appellants' argument is not persuasive. As set forth above, Appellants do
not establish persuasively that the Examiner is required to provide evidence
that a claim is directed to an abstract idea. Further, the Examiner provides
other bases, other than that the claims are directed to a fundamental
economic practice, for concluding the claims are directed to an abstract idea.
See, e.g., Answer 4--5. And, despite Appellants' narrower characterization
of claim 1 (see Appeal Br. 7), we determine that claim 1 is directed to
receiving bets on a wagering event and conveying recalculated odds based
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on the bets, albeit in a particular manner, which is itself a fundamental
economic practice long prevalent in our system of commerce, and, thus, is
an abstract idea. In addition, as found above, we determine that the claims
also are directed to the ineligible mental steps of collecting information,
analyzing it, and displaying certain results of the collection and analysis.
Appellants argue that the claims are not directed to the abstract idea
itself. See Appeal Br. 8. We disagree. As we state above, claim 1 is
directed to the abstract idea of receiving bets on a wagering event and
conveying recalculated odds based on the bets, albeit in a specified manner,
and merely invokes generic processes and machinery (i.e., the claimed
"processing device" and "non-transitory medium" (id. at Claims App.,
Claim 1)), in accordance with Enfzsh (see Enfzsh, 822 F.3d at 1336).
Appellants argue that "accepting for the sake of this argument only
that the claims are directed to [an] abstract idea[,] ... the Examiner has
failed to make a prima facie showing that the claims do not add something
more to this abstract idea." Appeal Br. 8; see also id. at 8-9. "The
Examiner has provided no evidence that [ the claim] limitations are not
substantially more than the alleged abstract ideas .... To make a findings of
fact, the Examiner must present substantial evidence showing that such
limitations are well-understood, routine[,] and conventional activities
previously known to the industry." Id. at 9. The Examiner cites numerous
cases, however, that include claims that are similar to Appellants' claims
(see Answer 4), and Appellants remarks (see Reply Br. 3) do not rebut the
Examiner's findings to establish persuasively that their claims are not well-
understood, routine, and conventional in view of these cases. Appellants'
claim 1 also does not recite additional components that "'transform ... the
claim' into a patent-eligible application" in accordance with Alice's second
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step, inasmuch as Appellants' claim 1 recites a generic processor and non-
transitory medium. See Alice Corp., 134 S. Ct. at 2358 ("[T]he relevant
question is whether the claims here do more than simply instruct the
practitioner to implement the abstract idea [] on a generic computer.").
Appellants argue that "the Examiner does not allege that [the claim]
limitations lack novelty or are obvious in view of the prior art. . . . To be
novel and non-obvious, these claims must then add something significantly
more to an abstract idea that the Examiner alleges is a fundamental
economic practice." We disagree-an abstract idea does not transform into
an inventive concept just because the prior art does not disclose or suggest
the idea. See Mayo, 132 S. Ct. at 1304. "Groundbreaking, innovative, or
even brilliant discovery does not by itself satisfy the§ 101 inquiry." Ass 'n
for Molecular Pathology, 133 S. Ct. at 2117. Indeed, "[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." Diamond v. Diehr, 450
U.S. 175, 188-89 (1981); see also Mayo, 132 S. Ct. at 1304 (rejecting "the
Government's invitation to substitute§§ 102, 103, and 112 inquiries for the
better established inquiry under § 101 ").
Appellants argue that DDR Holdings establishes that the claims are
patent eligible. Appeal Br. 9-10. We are not persuaded by Appellants'
argument. In DDR Holdings (DDR Holdings, LLC v. Hotels.com, L.P., 773
F.3d 1245 (Fed. Cir. 2014)), the Federal Circuit determined that, although
the patent claims at issue involved conventional computers and the Internet,
the claims addressed a challenge particular to the Internet, i.e., retaining
website visitors who, if adhering to the routine, conventional functioning of
Internet hyperlink protocol, would be transported instantly away from a
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host's website after "clicking" on an advertisement and activating a
hyperlink. DDR Holdings, 773 F.3d at 1257. The Court, thus, held that
those claims were directed to statutory subject matter because they recite a
solution "necessarily rooted in computer technology in order to overcome a
problem specifically arising in the realm of computer networks." Id. No
such technological advance is evident in the claimed invention. More
specifically, unlike the situation in DDR Holdings, Appellants do not
identify any problem particular to computer networks and/or the Internet that
the claims allegedly overcome.
Further, with respect to Appellants' argument that "the claims do not
attempt to preempt every application" of the claimed invention (Appeal
Br. 9), although monopolization, i.e., preemption, "might tend to impede
innovation more than it would tend to promote it, 'thereby thwarting the
primary object of the patent laws"' (Alice, 134 S. Ct. at 2354 (quoting
Mayo, 132 S. Ct. at 1293)), "the absence of complete preemption does not
demonstrate patent eligibility" (Ariosa Diagnostics, Inc. v. Sequenom, Inc.,
788 F.3d 1371, 1379 (Fed. Cir. 2015), cert. denied, 136 S. Ct. 2511 (2016);
see also OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1362---63
(Fed. Cir.), cert. denied, 136 S. Ct. 701 (2015) ("[T]hat 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.")).
DECISION
We AFFIRM the Examiner's rejection of claims 1-8, 17-20, and 22-
33.
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No time period for taking any subsequent action in connection with
this appeal may be extended under 37 C.F.R. § 1.136(a)(l)(iv).
AFFIRMED
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