Ex Parte Beddo et al

Patent Trials and Appeals Board

Jul 8, 2019

14137037 - (D) (P.T.A.B. Jul. 8, 2019)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE
14/137,037 12/20/2013
24239 7590 07/10/2019
MOORE & VAN ALLEN PLLC
ATTN: IP DEPARTMENT
100 North Tryon Street
Suite 4700
Charlotte, NC 28202
FIRST NAMED INVENTOR
Michael Ervin Beddo
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.
036319-000012 1015
EXAMINER
SCHEUNEMANN, RICHARD N
ART UNIT PAPER NUMBER
3624
NOTIFICATION DATE DELIVERY MODE
07/10/2019 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):
iplaw@mvalaw.com
usptomail@mvalaw.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte MICHAEL ERVIN BEDDO, HUI DU, and
ANTHONY PAUL BEGG 1
Appeal2017-009809
Application 14/137,037
Technology Center 3600
Before ANTON W. PETTING, BIBHU R. MOHANTY, and
NINA L. MEDLOCK, Administrative Patent Judges.
MOHANTY, Administrative Patent Judge.
DECISION ON APPEAL
STATEMENT OF THE CASE
The Appellants seek our review under 35 U.S.C. § 134(a) of the
rejection of claims 1, 5-8, 11, 15-18, 21, 25-28, 31-36, and 45-54, which
are all the claims pending in the application. We have jurisdiction under
35 U.S.C. § 6(b). Oral arguments were presented on June 27, 2019.
SUMMARY OF THE DECISION
We AFFIRM.
1 According to Appellants, the real party in interest is Data Ventures, Inc.
Appeal2017-009809
Application 14/137,037
THE INVENTION
The Appellants' claimed invention is directed to systems, methods,
and computer program products for providing sales forecasts (Spec., para 4).
Claim 11, reproduced below with the italics added, is representative of the
subject matter on appeal.
11. A computer implemented method for forecasting the
sales of a product, wherein the method includes generating a
sales forecast by inputting data associated with the product into
a neural network, the computer implemented method
compnsmg:
providing a processing device executing computer
readable code structured to cause the processing device to:
receive product information that comprises product
variables having values that are associated with at least one of
the price of the product or the consumer demand for the
product;
generate a first input vector, wherein the first input
vector is comprised of at least a portion of the product
variables;
apply either a random Gaussian matrix or genetic
algorithm to the first input vector to thereby generate a second
input vector comprising a reduced number of product variables
of the first vector input;
access a neural network model comprising at least one neural
network having a dynamic reservoir containing over five hundred
state units, wherein each of the state units is connected to at least one
other state unit in the dynamic reservoir and the connections between
the state units are weighted according a reservoir matrix having a
eigenvalue equal to: (1.025) x (S£/3) 112, wherein:
S = the number of state units in the dynamic reservoir;
and
£ = the sparsity of connections between the state units in the
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dynamic reservoir;
input the second input vector into a neural network
model in order to generate an initial sales forecast;
generate, via the neural network model, the initial sales
forecast, wherein the initial sales forecast is an output of the
neural network model and at least partially based on the second
input vector;
modify the initial sales forecast to generate a final sales
forecast by either shifting the initial sales forecast to a set of
historical norms using James-Stein shrinkage or applying both a
non-linear filter and a double exponential smoothing filter to at
least a portion of the initial sales forecast, to thereby render the
final sales forecast more accurate than the initial sales forecast;
present the final sales forecast to a user; and
export the final sales forecast to a computer system that
controls the production of the product based, at least in part, on
the value of the final sales forecast.
THE REJECTIONS
The following rejections are before us for review:
1. Claims 1, 5-8, 11, 15-18, 21, 25-28, 31-36, and45-54 are
rejected under 35 U.S.C. § 101 as being directed to non-statutory subject
matter.
2. Claims 1, 5-8, 11, 15-18, 21, 25-28, 31-36, and45-54 are
rejected under 35 U.S.C. § 112, first paragraph, as failing to show possession
of the claimed invention.
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FINDINGS OF FACT
We have determined that the findings of fact in the Analysis section
below are supported at least by a preponderance of the evidence. 2
ANALYSIS
Rejection under 35 U.S.C. § 101
The Appellants argue that the rejection of claim 11 is improper
because the claim is not directed to an abstract idea, overcomes problems in
neural networks, and is tied to computer technology (App. Br. 36-48; Reply
Br. 2-7). The Appellants argue further that the claim is "significantly more"
than the alleged abstract idea (App. Br. 49, 50; Reply Br. 7-9). The
Appellants also argue that the claim does not preempt the alleged abstract
idea (App. Br. 50, 51; Reply Br. 9, 10). The Appellants have also filed a
Supplemental Appeal Brief on June 10, 2019 and argue that the claim is not
directed to a judicial exception, that the claim integrates the alleged abstract
idea into a practical application, and recites technical improvements in the
field of computerized neural networks (Supp. Br. 3-6).
In contrast, the Examiner has determined that the rejection of record is
proper (Non-Final Action 2-7; Ans. 3-14).
We agree with the Examiner. An invention is patent eligible if it
claims a "new and useful process, machine, manufacture, or composition of
matter." 35 U.S.C. § 101. However, the Supreme Court has long interpreted
35 U.S.C. § 101 to include implicit exceptions: "[l]aws of nature, natural
2 See Ethicon, Inc. v. Quigg, 849 F.2d 1422, 1427 (Fed. Cir. 1988)
( explaining the general evidentiary standard for proceedings before the
Patent Office).
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phenomena, and abstract ideas" are not patentable. E.g., Alice Corp. v. CLS
Bankint'l, 573 U.S. 208,216 (2014).
In determining whether a claim falls within an excluded category, we
are guided by the Supreme Court's two-step framework, described in Mayo
and Alice. Id. at 217-18 ( citing Mayo Collaborative Servs. v. Prometheus
Labs., Inc., 566 U.S. 66, 75-77 (2012)). In accordance with that framework,
we first determine what concept the claim is "directed to." See Alice,
573 U.S. at 219 ("On their face, the claims before us are drawn to the
concept of intermediated settlement, i.e., the use of a third party to mitigate
settlement risk."); see also Bilski v. Kappas, 561 U.S. 593, 611 (2010)
("Claims 1 and 4 in petitioners' application explain the basic concept of
hedging, or protecting against risk .... ").
Concepts determined to be abstract ideas, and thus patent ineligible,
include certain methods of organizing human activity, such as fundamental
economic practices (Alice, 573 U.S. at 219-20; Bilski, 561 U.S. at 611 );
mathematical formulas (Parker v. Flook, 437 U.S. 584, 594--95 (1978)); and
mental processes (Gottschalkv. Benson, 409 U.S. 63, 69 (1972)). Concepts
determined to be patent eligible include physical and chemical processes,
such as "molding rubber products" (Diamond v. Diehr, 450 U.S. 175, 192
(1981) ); "tanning, dyeing, making waterproof cloth, vulcanizing India
rubber, smelting ores" (id. at 182 n.7 (quoting Corning v. Burden, 56 U.S.
252, 267---68 (1854))); and manufacturing flour (Benson, 409 U.S. at 69
(citing Cochrane v. Deener, 94 U.S. 780, 785 (1876))).
In Diehr, the claim at issue recited a mathematical formula, but the
Supreme Court held that "[a] claim drawn to subject matter otherwise
statutory does not become nonstatutory simply because it uses a
mathematical formula." Diehr, 450 U.S. at 187; see also id. at 191 ("We
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view respondents' claims as nothing more than a process for molding rubber
products and not as an attempt to patent a mathematical formula."). Having
said that, the Supreme Court also indicated that a claim "seeking patent
protection for that formula in the abstract ... is not accorded the protection
of our patent laws, and this principle cannot be circumvented by attempting
to limit the use of the formula to a particular technological environment."
Id. (internal citation omitted) ( citing Benson and Flook); see, e.g., id. at 187
("It is now commonplace that an application of a law of nature or
mathematical formula to a known structure or process may well be deserving
of patent protection.").
The PTO recently published revised guidance on the application of
§ 101. 2019 Revised Patent Subject Matter Eligibility Guidance, 84 Fed.
Reg. 50 (Jan. 7, 2019) ("Guidance"). Under the Guidance, we first look to
whether the claim recites:
( 1) any judicial exceptions, including certain groupings of
abstract ideas (i.e., mathematical concepts, certain methods of
organizing human activity such as a fundamental economic
practice, or mental processes); and
(2) additional elements that integrate the judicial exception into
a practical application (see MPEP § 2106.0S(a}-(c), (e}-(h)).
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:
(3) adds a specific limitation beyond the judicial exception that
is not "well-understood, routine, conventional" in the field (see
MPEP § 2106.0S(d)); or
( 4) simply appends well-understood, routine, conventional
activities previously known to the industry, specified at a high
level of generality, to the judicial exception.
See Guidance.
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If the claim is "directed to" an abstract idea, we tum to the second
step of the Alice and Mayo framework, where "we must examine the
elements of the claim to determine whether it contains an "'inventive
concept'" sufficient to 'transform' the claimed abstract idea into a patent-
eligible application." Alice, 573 U.S. at 221 ( citation omitted). "A claim
that recites an abstract idea must include 'additional features' to ensure 'that
the [claim] is more than a drafting effort designed to monopolize the
[abstract idea]."' Id. (alterations in original) (quoting Mayo, 566 U.S. at 77).
"[M]erely requir[ing] generic computer implementation[] fail[ s] to transform
that abstract idea into a patent-eligible invention." Id.
Here, the Examiner has determined that the claim is directed to the
concept of using a mathematical formula or neural network to forecast the
sales of a product, which is based on a mathematical formula and an abstract
idea (Ans. 4). We substantially agree with the Examiner in this regard as
claim 11 is directed to the steps italicized in the claim above. These steps
are directed to the concept of using mathematical formulas to generate a
sales forecast, which is an idea of itself or a fundamental economic practice
and an abstract idea. See Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d
1350 (Fed. Cir. 2016) (collecting information, analyzing it, and displaying
results from certain results of the collection and analysis was held to be an
abstract idea). In Intellectual Ventures I LLC v. Capital One Financial, 850
F.3d 1332, 1340 (Fed. Cir. 2017) it was held that collecting, displaying, and
manipulating data was directed to an abstract idea. Thus, we consider the
claim to be directed to an abstract idea as identified above.
Turning to the second step of the Alice and Mayo framework, we
determine that the claim does not contain an inventive concept sufficient to
"transform" the abstract nature of the claim into a patent-eligible application.
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The claim does not improve computer functionality, improve another field or
technology, utilize a particular machine, or effect a physical transformation.
Rather, we determine that nothing in the claim imposes a meaningful limit
on the judicial exception, such that the claim is more than a drafting effort to
monopolize the judicial exception.
For example, in claim 11 the steps to [1] "receive product information
that comprises product variables"; [2] "generate a first input vector ...
generate a second input vector"; [3] "access a neural network model";
[ 4] "input the second input vector into a neural network model in order to
generate an initial sales forecast"; [5] "generate, via the neural network
model, the initial sales forecast"; [6] "modify the initial sales forecast to
generate a final sales forecast"; [7] "present the final sales forecast to a
user"; and [8] "export the final sales forecast to a computer system" are
merely conventional steps performed by a generic computer that do not
improve computer functionality. That is, these recited steps [1]-[8] "do not
purport to improve the functioning of the computer itself' but are merely
generic functions performed by a conventional processor. Likewise, these
same steps [ 1 ]-[8] listed above do not improve the technology of the
technical field and merely use generic computer components and functions
to perform the steps. Also, the recited method steps [ 1 ]-[8] above do not
require a "particular machine" and can be utilized with a general purpose
computer, and the steps performed are purely conventional. In this case, the
general purpose computer is merely an object on which the method operates
in a conventional manner and does not provide "significantly more" to the
claim beyond a nominal or insignificant execution of the method. Further,
the claim as a whole fails to effect any particular transformation of an article
to a different state in a manner that would render the claim "significantly
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more" than the abstract idea. The recited steps [ 1 ]-[8] fail to provide
meaningful limitations to limit the judicial exception and rather are mere
instructions to apply the method to a generic computer. Considering the
elements of the claim both individually and as "an ordered combination" the
functions performed by the computer system at each step of the process are
purely conventional. Each step of the claimed method does no more than
require a generic computer to perform a generic computer function.
Further, the claim fails to add a specific limitation beyond the judicial
exception that is not well-understood, routine, and conventional in the field.
Rather the claim uses well-understood, routine, and conventional activities
previously known in the art at a high level of generality to the judicial
exception. The Specification at paragraphs 66, 86, 92, and 134, for example,
describes using conventional computer components such as cellular
networks, wireless communication protocols, local area networks, and the
Internet in a conventional manner. The claim specifically includes
recitations for a processing device to implement the method but these
computer components are all used in a manner that is well-understood,
routine, and conventional in the field. The Appellants have not shown these
claimed generic computer components, which are used to implement the
claimed method are not well understood, routine, or conventional in the
field. The Appellants have not demonstrated that the processing device that
is claimed is computer component beyond those known to be routine and
conventional and to perform similar functions in a well-understood manner.
We note the point about pre-emption (App. Br. 50, 51; Reply Br. 9,
10). Although pre-emption "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 Collaborative Servs. v.
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Prometheus Labs., Inc., 132 S. Ct. 1289, 1293 (2012)), "the absence of
complete preemption does not demonstrate patent eligibility" (Ariosa
Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir. 2015)).
See also OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1362---63
(Fed. Cir. 2015) ("[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.").
The Appellants at page 37 of the Appeal Brief have cited to Enfish,
LLC v. Microsoft Corp., 822 F.3d 1327 (Fed. Cir. 2016) to show that the
claim is not abstract but the claims in that case were not similar in scope to
those here in contrast and were in contrast directed to a self-referential data
table.
The Appellants in the Appeal Brief at page 38 have also cited to
McRO, Inc. v. Bandai Namco Games Am. Inc., 837 F.3d 1299 (Fed. Cir.
2016) but the claims in that case are distinguished from this case in being
directed to rules for lip sync and facial expression animation.
The Appellants cite to DDR Holdings, LLC v. Hotels, L.P., 773 F. 3d
1245 (Fed. Cir. 2014) and argue that the claim is "rooted in computer
technology" (App. Br. 49). We disagree, as the Appellants have not shown
how the claimed subject matter is rooted in technology given that the
Specification describes only the use of generic computer equipment used in
a routine, conventional, and generic manner.
For these reasons, the rejection of claim 11 is sustained. The
Appellants have provided the same arguments for the remaining claims,
which are drawn to similar subject matter and the rejection of these claims is
sustained for the same reasons given above.
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Rejection under 35 U.S. C. § 112, first paragraph
The Examiner has determined that for claims 1, 11, 21, 45, 48, 51, and
54 that the Specification fails to provide support and show possession for the
recitation to: 1. "apply either a Gaussian matrix or genetic algorithm to the
first input vector to thereby generate a second input vector"; 2. "input the
second input vector into the network neural model in order to generate an
initial sales forecast"; and 3. "modify the initial result to generate a final
result ... using the James-Stein shrinkage or applying both a non-linear
filter and a double exponential smoothing filter to at least a portion of the
initial result" (Non-Final Act. 2, 3, 7-10; Ans. 10-14).
In contrast, the Appellants have argued that the cited claim limitations
recite terms known in the art and filed Exhibits B-E to show that these terms
would have been known to one of ordinary skill in the art (Appeal Br. 52-
54, Reply Br. 11, 12). We have reviewed both the rejection of record and
Exhibits as well as the Specification itself and determine that the cited claim
terms would have been known to one of ordinary skill in the art and the
failure to show possession of the invention has not been shown. For this
reason, the rejection of record is not sustained.
CONCLUSIONS OF LAW
We conclude that Appellants have not shown that the Examiner erred
in rejecting claims 1, 5-8, 11, 15-18, 21, 25-28, 31-36, and 45-54 under
35 U.S.C. § 101.
We conclude that Appellants have shown that the Examiner erred in
rejecting claims 1, 5-8, 11, 15-18, 21, 25-28, 31-36, and 45-54 under 35
U.S.C. § 112, first paragraph.
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DECISION
The Examiner's rejection of claims 1, 5-8, 11, 15-18, 21, 25-28, 31-
36, and 45-54 is sustained.
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). See
37 C.F.R. § 41.50(±).
AFFIRMED
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