Ex Parte Barous

Patent Trial and Appeal Board

Jul 29, 2016

10397778 (P.T.A.B. Jul. 29, 2016)

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.
10/397,778 03/25/2003 Paul R. Barous 6036-001 5188
24112 7590 08/01/2016
COATS & BENNETT, PLLC
1400 Crescent Green, Suite 300
Cary, NC 27518
EXAMINER
HAMILTON, MATTHEW L
ART UNIT PAPER NUMBER
3682
MAIL DATE DELIVERY MODE
08/01/2016 PAPER
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.
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
____________________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________________

Ex parte PAUL R. BAROUS
____________________

Appeal 2016-003320
Application 10/397,778
Technology Center 3600
____________________

Before NEAL E. ABRAMS, CHARLES N. GREENHUT,
and ANNETTE R. REIMERS, Administrative Patent Judges.

ABRAMS, Administrative Patent Judge.

DECISION ON APPEAL

STATEMENT OF THE CASE
Paul R. Barous (Appellant) appeals under 35 U.S.C. § 134 from the
Examiner’s decision rejecting claims 14–17 and 27–61 under 35 U.S.C.
§ 101 as drawn to patent-ineligible subject matter. We have jurisdiction
under 35 U.S.C. § 6(b). We decided a previous appeal, 2013-00446, on April
25, 2014.
We REVERSE.

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THE CLAIMED SUBJECT MATTER
Claims 14 and 43, reproduced below, are illustrative of the claimed
subject matter.
14. A system for distributing third-party coupons by a retailer
on the Internet, the Internet including a computer with a monitor
and a printer, the third-party coupons being associated with
goods or services of a third-party retailer, which goods or
services are unrelated to the goods or services of the retailer and
wherein the third-party retailer purchases advertising from the
retailer, the system comprising:
a server configured to:
cause a graphical user interface (GUI) to be displayed on
the monitor;
display an advertisement associated with a third-party
coupon of the third-party retailer;
display a threshold value in the GUI;
calculate a value of a transaction based on a purchase of
goods or services made from the retailer by a consumer;
display the value of the transaction in the GUI; and
enable the computer to print the third-party coupon when
the value of the transaction exceeds the threshold value;
wherein the third-party coupon is redeemable for the
goods or services of the third-party
retailer; and
wherein goods or services of the third-party retailer are
unrelated to the goods or
services sold by the retailer and therefore are unpurchaseable
from the retailer.
43. A checkout system for a retail outlet for distributing third-
party discount coupons associated with one or more third-party
retailers comprising:
a printer; and
a point-of-sale register having a processor configured to:
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add prices of items purchased by a shopper to reach a total
sale ST; compare the total sale ST of the shopper to a threshold
sale value T; and
print one or more third-party coupons for use with a
respective third-party retailer to purchase goods or services
unrelated to the goods or services offered by the retail outlet if
the total sale ST of the shopper exceeds the threshold sale value
T.
OPINION
Background
A patent may be obtained for “any new and useful process, machine,
manufacture, or composition of matter, or any new and useful improvement
thereof.” 35 U.S.C. § 101. The Supreme Court has held that this provision
contains an important implicit exception: laws of nature, natural phenomena,
and abstract ideas are not patentable. Alice Corp. Pty. Ltd. v. CLS Bank Int'l,
134 S. Ct. 2347, 2354 (2014); Gottschalk v. Benson, 409 U.S. 63, 67 (1972)
(“Phenomena of nature, though just discovered, mental processes, and
abstract intellectual concepts are not patentable, as they are the basic tools of
scientific and technological work.”). Notwithstanding that a law of nature or
an abstract idea, by itself, is not patentable, the application of these concepts
may be deserving of patent protection. Mayo Collaborative Servs. v.
Prometheus Labs., Inc., 132 S. Ct. 1289, 1293–94 (2012).
The Supreme Court has set forth “a framework for distinguishing
patents that claim laws of nature, natural phenomena, and abstract ideas
from those that claim patent-eligible applications of those concepts.” Alice,
134 S. Ct. at 2355 (citing Mayo, 132 S. Ct. at 1294). According to the
Supreme Court’s framework, it must first be determined whether the claims
at issue are directed to one of those concepts (i.e., laws of nature, natural
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phenomena, and abstract ideas). Id. If so, a second determination must be
made to “consider the elements of each claim both individually and ‘as an
ordered combination’ to determine whether the additional elements
‘transform the nature of the claim’ into a patent-eligible application.” Id.
The Supreme Court characterizes the second step of the analysis as “a 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.
(brackets in original) (quoting Mayo, 132 S. Ct. at 1294).
Positions Taken By Examiner and Appellant
Against this backdrop, the Examiner has determined that claims 14–
17 and 27–61 are directed to an abstract idea, and therefore are ineligible
subject matter under 35 U.S.C. § 101. With regard to the first Alice test, the
Examiner found:
Applicant's claimed invention, as described in independent
process claims (i.e., method claims) 27 and 50, includes an
abstract idea. The claimed invention is directed to distributing
coupons by a retailer for the purpose of enhancing revenue.
Distributing coupons by a retailer for the purpose of enhancing
revenue is a fundamental economic practice (enhancing revenue)
and employs mathematical relationships/ formulas (algorithms)
to achieve this outcome. As noted above, fundamental economic
practices and mathematical relationships/formulas are examples
of abstract ideas explicitly referenced in Alice Corp. Therefore,
because independent claims 27 and 50 include an abstract idea,
the claims must be reviewed under Part II of the Alice Corp.
analysis to determine whether the abstract idea has been applied
in an eligible manner.
Final Act. 4 (emphasis added). The Examiner also “notes the claims do not
attempt to preempt all uses of the abstract idea, however, the claims reads
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[sic] on the abstract idea of a fundamental economic practice and
mathematical formula/relationship without significantly more.” Id. at 8.
With regard to these findings, Appellant states that he
agrees that the examiner has identified the abstract idea. The
examiner finds that the abstract idea is "distributing coupons by
a retailer for the purpose of enhancing revenue". Appellant’s
Brief, pg. 10. As discussed above, to establish a prima facie case,
the examiner must next identify all of the additional elements in
each claim and explain why these elements, individually or
collectively, do not add significantly more than the abstract idea.
Reply Br. 7. This being the case, Appellant has not disputed that the claims
are directed to an abstract idea and thus there is no controversy over the first
Alice test.
On page 5 of the Final Action, the Examiner finds with regard to the
second test in Alice that:
The abstract idea of distributing coupons by a retailer
for the purpose of enhancing revenue has not been applied in
an eligible manner. The steps or acts performed (utilizing a
processor) in independent method claims 27 and 50 are not
enough to qualify as "significantly more" than the abstract idea
itself, since the claims are a mere instruction to apply the
abstract idea. Furthermore, there is no improvement to another
technology or technical field, no improvements to the
functioning of the computer itself, and no meaningful
limitations beyond generally linking the use of an abstract idea
to a particular technical environment, and the claims require no
more than a generic computer to perform generic computer
functions that are well-understood, routine and conventional.
Therefore, based on the two-part Alice Corp. analysis, there are
no meaningful limitations in the claims that transform the
exception (i.e., abstract idea) into a patent eligible application.
Id. (emphasis added). The Examiner has applied this analysis to all the other
claims in the rejection.
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Appellant explains that in the prior art it was common for retailers to
distribute coupons to enhance the sale of items goods or services provided
by themselves or their distributors at the point-of-sale, on the goods or
services themselves, or dispensing from a device located on the shelving,
However, Appellant argues that the claimed invention goes beyond, for it
entails systems and methods that enable a retailer to distribute
coupons in a different way. For example, the retailer's point-
of-sale (POS) register distributes a so-called third-party coupon
that is redeemable for a discount on the goods or services sold
by some other retailer. These goods or services of the third-
party retailer are unrelated to the goods or services offered by
the retailer distributing the coupon. The retailer's POS register
is configured to print this coupon for a shopper when the
register determines that the value of the goods or services
purchased by the shopper from the retailer exceeds a threshold
value. This enhances the retailer's revenue because the shopper
increases his or her purchase from the retailer in order to
receive discount coupons for a third-party retailer.
App. Br. 3.
Focusing upon claim 43 as an example, Appellant, with reference to
case law, again emphasizes that the second step in Alice
is the search for an "inventive concept", or some element or
combination of elements to ensure that the claim in practice
amounts to "significantly more" than a patent on the abstract
idea itself. DDR Holdings, LLC, v. Hotels.com, L.P., 773 F.3d
1245, 1255 (Fed. Cir. 2014) citing Alice, 134 S. Ct. at 2347,
2355. Such is the case if "additional substantive limitations ...
narrow, confine, or otherwise tie down the claim so that, in
practical terms, it does not cover the full abstract idea itself."
Alice, 717 F.3d at 1282 (emphasis added). The preemptive effect
of a claim, therefore, intricately drives Mayo Step Two.
Id. at 8–9. Appellant then states that “[t]he claims, in part, only reflect the
idea of ‘distributing coupons by a retailer for the purpose of enhancing
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revenue,’” and that “[t]he Examiner correctly determines that this idea is
abstract . . . . [but] is the only thing in claim 43 that has been around for over
a century.” App. Br. 10. Thus, Appellant asserts, the claims meet the
second Alice test because they add specific limitations to what is known in
the art, for
[i]t is unconventional for a retailer's POS register to print a
coupon for the purchase of a third-party retailer's unrelated goods
or services. It is especially unconventional for the retailer's POS
register to condition doing this on a shopper's total purchase from
the retailer exceeding a certain threshold sale value. None of this
is routine or well understood. In fact, twelve years of prosecution
reveals that nothing in the prior art teaches these additional
features or even renders them obvious. Nothing of record
demonstrates that this sort of activity has ever been previously
engaged in by those in the field.
Id. at 11. Appellant goes on to assert that the Examiner has erred in ignoring
the additional features. Issue is also taken by Appellant with the Examiner’s
finding that the language in the claims “reads on” the abstract idea, which
Appellant contends means, as understood in the patent law, that “the claims
and the abstract are one and the same,” which is in error, for they provide
much more detail. See id. at 10. And, again with reference to claim 43 as an
example, Appellant expresses the position that:
Claim 43 not only ties its limitations to a particular
machine or apparatus, but the claim also states exactly how the
particular machine or apparatus is to be configured in order to
produce the claimed invention. The claim specifies the POS
register is configured to add up the shopper's total sale, compare
the total sale to a threshold, and print a third-party coupon if
the total sale exceeds the threshold. Claim 43 leaves few details
out about how the POS register is to be configured. Unlike the
claims in Alice, therefore, Justice Kagan could not state that
"your patents really did just say do this on a computer, as
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opposed to saying anything substantive about how to do it on a
computer." Alice, oral argument, p. 19.
App. Br. 15.
Analysis
Although we have carefully considered the presentations made by the
Examiner in the Final Action and the Answer, we are persuaded by
Appellant’s arguments that the claims meet this test, and therefore we will
not sustain the rejection. Our reasoning follows.
Throughout the Final Action and the Answer, the Examiner defines
“the abstract idea” to which Appellant’s claims are directed as “distributing
coupons by a retailer for the purpose of enhancing revenue,” and has
contended that the systems and methods defined in Appellant’s claims were
well-known and conventional. Be that as it may, Appellant’s claims are not
directed to the “abstract idea” as defined by the Examiner, which is quite
broad, but to much more limited systems and methods distributing only
coupons redeemable at a third-party retailer for goods that were
unpurchaseable at the issuing retailer and/or are unrelated to the goods or
services offered by the issuing retailer, and then only upon the occurrence of
certain conditions. Independent claims 14, 27, and 50 recite systems or
methods which comprise displaying advertising for the articles redeemable
at the third party retailer by the retailer, adding together the prices of the
items purchased at the retail outlet to reach a total sale value, comparing the
total sale value to a threshold sale value, printing one or more coupons for
use with third party retailers, and defining with specificity the manner and
sequence in which such equipment as registers, processors, and printers are
operated in order to perform the claimed systems and methods. Independent
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claim 43 recites the same limitations, less that of displaying the advertising.
These limitations set forth the essence of Appellant’s invention, and they
clearly narrow the claims so that they do not preempt the “abstract idea”
defined by the Examiner.
In addition, among the considerations that qualify claims for the
“significantly more” exception set forth in the 2014 Interim Guidance on
Patent Subject Matter Eligibility, published for use by USPTO personnel in
determining subject matter eligibility under 35 U.S.C 101 in view of recent
decisions by the U.S. Supreme Court (see Federal Register Vol. 79, No. 241
at 74624), are adding to the abstract idea “specific limitations other than
what is well understood, routine and conventional in the field, or adding
unconventional steps that confine the claim to a particular useful
application.” The guidance further states that, if the Examiner decides the
additional elements fail to add “significantly more” to the claim, the
elements must be identified and explanations presented as to why this is so.
In the present case, the Examiner has taken the position that the limitations
Appellant argues qualify the claims for an exemption “are generic computer
functions (e.g. adding, comparing and printing) that are well-understood,
routine and conventional activities previously known to the industry” (see,
for example, Ans. 5). However, the Examiner has failed to provide
persuasive argument or evidence in support of this conclusion, and that the
above-noted qualifications recited in Interim Guidance have been met.
Therefore, we conclude that Appellant’s claims add “significantly
more” to the abstract idea set forth by the Examiner and meet the second
Alice test, and the rejection is in error.
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DECISION
The rejection is not sustained.
The decision of the Examiner is reversed.
REVERSED