Ex Parte Chittaro

Patent Trial and Appeal Board

Feb 6, 2019

14156259 (P.T.A.B. Feb. 6, 2019)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE FIRST NAMED INVENTOR
14/156,259 01/15/2014 Michael Chittaro
66945 7590 02/08/2019
KILPATRICK TOWNSEND & STOCKTONLLP/VISA
Mailstop: IP Docketing - 22
1100 Peachtree Street
Suite 2800
Atlanta, GA 30309
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.
79900-895223 3389
EXAMINER
CHANG, EDWARD
ART UNIT PAPER NUMBER
3696
NOTIFICATION DATE DELIVERY MODE
02/08/2019 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):
ipefiling@kilpatricktownsend.com
KTSDocketing2@kilpatrick.foundationip.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte MICHAEL CHITTAR0 1
Appeal2017-010733
Application 14/156,259
Technology Center 3600
Before ROBERT E. NAPPI, ERIC S. FRAHM, and MICHAEL T. CYGAN
Administrative Patent Judges.
NAPPI, Administrative Patent Judge.
DECISION ON APPEAL
This is a decision on appeal under 35 U.S.C. § 134(a) of the Final
Rejection of claims 1, 2, 4, 7 through 10, 12, 15 through 18, and 20 through
23.
We AFFIRM.
INVENTION
The invention is directed to a system and method for providing
multinational prepaid services in a plurality of countries. Abstract. Claim 1
is illustrative of the invention and is reproduced below:
1 According to Appellant, the real party in interest is Visa International
Service Association. App. Br. 3.
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Application 14/156,259
1. A method of processing multinational prepaid
funding transactions via one or more communication networks,
the method comprising:
receiving, by a server computer via the one or more
communication networks, a device file uploaded from an
originating issuer in an originating country, the device file
comprising recipient information for a plurality of fund
recipients and device file information including a total number
of fund recipients, an originating currency, a destination
currency, a foreign exchange rate, a total disbursement amount,
and a destination issuer for each of a plurality of destination
countries, and wherein a representative of the originating issuer
uploads the device file via a funding program generation user
interface;
providing to the representative of the originating issuer,
via the funding program generation user interface, the device
file information including the total number of fund recipients,
the originating currency, the destination currency, the foreign
exchange rate, and the destination issuer for each of the
plurality of destination countries for confirmation;
splitting, by the server computer, the device file into a
plurality of destination device files upon receiving confirmation
from the representative of the originating issuer, each of the
destination device files including one or more of the plurality of
fund recipients, wherein the plurality of destination device files
correspond to the plurality of destination countries;
generating, by the server computer, a prepaid funding file
including exchange information for each of the plurality of
destination device files;
distributing the plurality of destination device files to a
plurality of destination issuers via the one or more
communication networks; and
transferring a plurality of funds to the plurality of
destination issuers from the originating issuer using the prepaid
funding file by transmitting the prepaid funding file to a funds
transfer system configured to transfer funds from the
originating issuer to the plurality of destination issuers, wherein
the funds transfer system is configured to use the prepaid
funding file to initiate a plurality of fund transfers, each of the
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Application 14/156,259
plurality of fund transfers associated with one of the plurality of
destination issuers, wherein each of the plurality of funds are
transferred in a local currency of one of the plurality of
destination countries, and wherein the plurality of destination
issuers provide a portion of the transferred funds to each of the
plurality of fund recipients associated with the received
destination device file of the plurality of destination device files
as prepaid funds.
REJECTION AT ISSUE
The Examiner rejected claims 1, 2, 4, 7 through 10, 12, 15 through 18,
and 20 through 23 under 35 U.S.C. § 101 for being directed to patent-
ineligible subject matter. Final Act. 4---6. 2
PRINCIPLES OF LAW
Patent-eligible subject matter is defined in 35 U.S.C. § 101 of the
Patent Act, which recites:
Whoever invents or discovers any new and useful
process, machine, manufacture, or composition of matter, or
any new and useful improvement thereof, may obtain a patent
therefor, subject to the conditions and requirements of this title.
There are, however, three judicially created exceptions to the broad
categories of patent-eligible subject matter in 35 U.S.C. § 101: "[l]aws of
nature, natural phenomena, and abstract ideas." Alice Corp. Pty. Ltd. v. CLS
Banklnt'l, 573 U.S. 208,216 (2014); Mayo Collaborative Servs. v.
Prometheus Labs., Inc., 566 U.S. 66, 70 (2012).
2 Throughout this Opinion, we refer to the Appeal Brief, filed March 6,
2017 ("App. Br."), the Reply Brief, filed August 11, 2017 ("Reply Br."), the
Examiner's Answer, mailed June 12, 2017 ("Answer"), and the Final Office
Action, mailed October 6, 2016 ("Final Act.").
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Application 14/156,259
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. Alice, 573 U.S. at 217-18 (citing Mayo, 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 (Gottschalk v. Benson, 409 U.S. 63, 67 (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 water-proof 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 176; see also id. at 192 ("We
view respondents' claims as nothing more than a process for molding rubber
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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. ( 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.").
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 (internal quotation marks
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. (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.
The PTO recently published revised guidance on the application of
§ 101. USPTO's January 7, 2019 Memorandum, 2019 Revised Patent
Subject Matter Eligibility Guidance, 84 Fed. Reg. 50 (Jan. 7, 2019)
("Memorandum"). Under that guidance, we first look to whether the claim
is directed to a judicial exception because:
(1) the claim recites a judicial exception, including certain groupings
of abstract ideas (i.e., mathematical concepts, certain methods of
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organizing human interactions such as a fundamental economic
practice, or mental processes); and
(2) the claim as a whole fails to recite additional elements that
integrate the judicial exception into a practical application (see MPEP
§ 2106.05(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 are not
"well-understood, routine, conventional" in the field (see MPEP
§ 2106.05(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 Memorandum.
ANALYSIS
Abstract Idea.
The Examiner finds that the claims are not patent eligible as they are
directed to a judicial exception without reciting significantly more. Final
Act. 4---6. Specifically, the Examiner finds that the claims are directed to an
abstract idea; in particular, to organizing interpersonal human activities such
as satisfying legal obligations via the fundamental economic practice of
transferring funds. Final Act. 4--6; Answer 3.
Appellant argues the Examiner's rejection is in error as:
[T]he present application is unrelated to any "fundamental
economic practices" or "certain methods of organizing human
activity" listed in the Interim Guidance, as the examples of
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"fundamental economic practices" and "certain methods of
organizing human activity," found by the courts, or
"fundamental economic practices" and "certain methods of
organizing human activity" in general. For example, the
appealed claims are directed to providing a multinational
prepaid system that splits a device file that includes data
structures identifying information associated with issuance of a
plurality of funds to a plurality of fund recipients into a
plurality of destination devices files that identify a destination
issuer for each of a plurality of destination countries.
App Br. 13 ( emphasis omitted). Further, Appellant argues that the Examiner
has not met the burden of proof in establishing the claims are directed to an
abstract idea. App Br. 14--15; Reply Br. 3--4.
Appellant's arguments have not persuaded us of error in the
Examiner's conclusion that the claims are directed to an abstract idea. We
concur with the Examiner that claim 1 is directed to a method of organizing
human activity (an abstract idea). Claim 1 recites limitations setting forth
steps relating to managing commercial transactions between people,
including the fundamental economic practice of transferring funds between
people. Specifically, claim 1 recites . . . "receiving" recipient financial
information, "providing" that financial information to an originating issuer,
subdividing ("splitting") that financial information by destination,
"generating" additional destination-based financial information,
"distributing" the financial information to destination issuers, and
"transferring ... funds" according to the financial information.
The Examiner identifies the recited concept as being similar to those
at issue in prior Federal Circuit decisions, citing buySAFE, Inc. v. Google,
Inc., 765 F.3d 1350, 1355 (Fed. Cir. 2014) (finding an abstract idea where
the claims recited a "transaction performance guaranty," described as a
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commercial contractual relationship between parties), and Accenture Glob.
Servs., GmbH v. Guidewire Software, Inc., 728 F.3d 1336, 1339, 1342 (Fed.
Cir. 2013) (finding an abstract idea where the claims recited "tasks to be
performed in an insurance organization"). See Answer 3. Our reviewing
court has further stated, "claims directed to the performance of certain
financial transactions ... must be categorized as involving abstract ideas."
Smart Sys. Innovations, LLC v. Chicago Transit Auth., 873 F.3d 1364, 1371
(Fed. Cir. 2017) (claims relating to methods of paying subway fare via
bankcard).
We concur with the conclusion of the Examiner. While the cases
cited by the Examiner do not identically identify that transferring funds as
part of a prepaid funding transactions are an abstract idea, the Examiner has
nonetheless presented evidence and reasoning sufficient to support a
conclusion that the claims recite an abstract idea. Accordingly, Appellant's
arguments have not persuaded us the Examiner erred in finding the claims
recite an abstract idea.
Appellant further argues that the claims are not like court-identified
abstract ideas because they include features such as "a multinational prepaid
system." App. Br. 13; Reply Br. 2, 4. The Examiner found, to the contrary,
that such features did not distinguish the claims from being similar to, nor
prevent the claims from being directed to, abstract ideas that have been
identified by the courts. Answer 3.
We concur with the conclusion of the Examiner. To the extent that
the claims are narrowed to a particular type of transaction; e.g., being
"multinational," "prepaid," and involving subdivision by destination
country, multiple currencies and foreign exchange rate, such "narrowing of
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such long-familiar commercial transactions does not make the idea non-
abstract for section 101 purposes." buySAFE, Inc. v. Google, Inc., 765 F.3d
1350, 1355 (Fed. Cir. 2014).
Practical Application/Significantly more than Abstract Idea
The Examiner finds that
the claims do not include additional elements that are sufficient
to amount to significantly more than the judicial exception,
such as:
Final Act. 5.
• Improvement to another technology or technical field.
• Improvements to the functioning of the computer itself.
• Applying the judicial exception with, or by use of, a
particular machine.
• Effecting a transformation or reduction of a particular
article to a different state or thing.
• Adding a specific limitation 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.
• Other meaningful limitations beyond generally linking
the use of an abstract idea to a particular technological
environment.
Appellant argues that the independent claims are rooted in computer
technology and as such are patent eligible. App. Br. 15-20. Appellant
argues that the claims are analogous to the patent eligible claims in DDR
Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245 (Fed. Cir. 2014) and
Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1335 (Fed. Cir. 2016) as the
claims overcome a problem arising in the realm of computer technology and
have no pre-computer analog. App. Br. 16-17; Reply Br 5---6. Specifically,
Appellant argues:
The unique combination of claimed subject matter here,
including the multinational prepaid system that utilizes a data
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structure that includes information associated with issuance of a
plurality of funds to a plurality of fund recipients and
communication between various computers and user interfaces
over communication networks of a computer and computer
network, did not exist in the pre-computer world.
App. Br. 17 ( emphasis omitted).
Appellant further argues the claims "are instead directed to a specific
improvement to the way computers receive and process requests to receive
and process a device file from an originating issuer for use in identifying
destination issuers in other countries for transferring of funds." App. Br. 18;
Reply Br. 6-8 ( citing Enfzsh ). Appellant also asserts that paragraphs 2 and 3
of the originally filed Specification discuss the problems with conventional
systems and demonstrate the invention is an improvement to the way
computers operate. App. Br. 19--20 ( citing Enfzsh ).
We are not persuaded of error in the Examiner's rejection by these
arguments. The data structure of Enfish was "not simply directed to any
form of storing tabular data," but instead, included a very specifically
defined means for configuring a logical data table that required a four-step
algorithm to render the table self-referential. Enfish, 822 F.3d at 1336. We
do not consider representative claim 1 to recite a particular data structure as
per Enfzsh. While the claim identifies files which contain certain
information, e.g., recipient, currency, destination country, the claim does not
require the data to be in any specified structure. Neither claim 1 nor
Appellant's Specification recites that the files are in a particular structure
that changes the manner in which the computer operates; instead, the claim
merely recites the nature of the information that forms the essentials of the
claimed financial transaction.
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Further, the Enfzsh court found "the plain focus of the claims is on an
improvement to computer functionality itself, not on economic or other tasks
for which a computer is used in its ordinary capacity." Enfzsh, 822 F.3d at
1336. Paragraphs 2 and 3 of Appellant's Specification fail to demonstrate
that the invention is directed to an improvement in computer operation rather
than an improvement to an economic task. These cited paragraphs of
Appellant's Specification identify a desire to transfer funds and that it is a
costly endeavor as it requires multiple transfers between middle men,
currency exchanges, and requires a large administrative structure to provide
oversight and enforcement (i.e. an economic problem). Thus, Appellant's
Specification does not identify the problem to be solved is a computer
related problem under the rubric of Enfzsh.
Instead, the computer is merely an intermediary, as was the situation
in Alice. Alice, 5 7 4 US. at 2 2 4. The Supreme Court characterized the
claims in Alice as "the use of a computer to create electronic records, track
multiple transactions, and issue simultaneous instructions." Id. Each of
these steps was found to do "no more than require a generic computer to
perform generic computer functions," and were found to merely amount to
"an instruction to apply the abstract idea of intermediated settlement using
some unspecified, generic computer." Id. Thus, we are not persuaded by
Appellant's arguments that the claims are rooted in computer technology,
rather, the claims merely recite use of a computer as a tool to implement a
method of organizing human activity involving a fundamental economic
principle (an abstract idea). See, e.g., RecogniCorp LLC v. Nintendo Co.,
Ltd., 855 F.3d 1322, 1327 (Fed. Cir. 2017) ("Unlike Enfish, [the claim] does
not claim a method that improves the functioning of a computer ... [but]
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claims a 'process that qualifies as an "abstract idea" for which computers are
invoked merely as a tool"').
Appellant additionally argues that the claims are patent eligible as
they perform an ordered combination of claimed steps and are an
improvement in computer related technology. App. Br. 21-23 ( citing
McRO, Inc. v. Bandai Namco Games Am. Inc., 837 F.3d 1299 (Fed. Cir.
2016)).
The Examiner responds to Appellant's arguments stating that the
claims in the current application differ from those at issue in McRO.
Answer 4. In McRO, the combination of steps were directed to a
technological solution to affect lip synchronization and manipulation of
facial expressions, whereas the argued steps of Appellant's claims are
directed to the abstract idea itself and not a technical problem. Answer 4.
We concur. The court in McRO stated "[i]t is the incorporation of the
claimed rules, not the use of the computer that 'improved the existing
technological process."' McRO, 837 F.3d at 1314 (citing Alice). As
discussed above, we do not find that the claims are directed to improving a
technological process, and as such, we are not persuaded by Appellant's
arguments citing McRO.
Appellant argues that the claims do not seek to tie up the abstract idea
so that others cannot practice it. App. Br. 24--25. Further, Appellant argues
the claims are more specific and focused in scope than the alleged abstract
idea and as such granting the claim would not create a monopoly and
preempt every application of multinational prepaid funding transactions via
computer networks. App. Br. 26-28 and 31 ( citing BASCOM Glob. Internet
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Servs., Inc. v. AT&T Mobility LLC, 827 F.3d 1341 (Fed. Cir. 2016)); Reply
Br. 8-10.
We are not persuaded of error by Appellant's preemption argument.
A lack of complete preemption does not make the claims any less abstract.
See buySAFE, Inc., 765 F.3d at 1355; see also Ariosa Diagnostics, Inc. v.
Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir. 2015) ("While preemption
may signal patent ineligible subject matter, the absence of complete
preemption does not demonstrate patent eligibility."); see also OIP Techs.,
Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1362-1363 ("[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.").
Appellant additionally argues the Examiner has not provided evidence
that the features of claim 1 are well-understood, routine, and conventional
activities. App. Br. 28-29 (citing Ultramercial, Inc. v. Hulu, LLC, 772 F.3d
709 (Fed. Cir. 2014)).
The Examiner has found that the claim limitations other than the
abstract idea merely recite well-understood, routine, and conventional
activities. Final Act. 6. We concur. Appellant's Specification in paragraphs
2 and 3 identifies that it is known and conventional for financial institutions
to issue prepaid cards and transfer funds. Further, paragraphs 92 through 96
of Appellant's Specification identify that the computers implement the
system generically and identify that they can be "any of a variety of
computing structures, arrangements, and compilations for servicing the
requests from one or more client computers," thus, showing that the use of
computers to implement the abstract idea is merely using known computers.
Further, as discussed above, the use of records or files to create and maintain
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financial information, such as ledgers and invoices, has been found to be
"electronic recordkeeping- one of the most basic functions of a computer."
Alice, 573 U.S. at 225. Thus, we find ample evidence to support the
Examiner's finding the claims are directed to well-understood and
conventional activities.
Finally, Appellant additionally argues that even if the claims are
directed to an abstract idea, the features of claim 1, when viewed as an
ordered combination, amount to "significantly more" than the recited
abstract idea. App. Br. 30-32. Appellant argues that the claim involves
novel and nonobvious techniques that do not preempt all ways of processing
multinational prepaid funding transactions and that improve the function of a
computer or other technology. Id. Appellant's arguments grounded in
preemption and improvement to a computer or other technology are not
persuasive as discussed, supra. Appellant's further argument grounded in
novelty and nonobviousness was not found persuasive by the Examiner
because the Examiner found improvements only to the abstract idea itself.
Answer 3. We concur with the conclusion of the Examiner. Issues of
novelty and nonobviousness under 35 U.S.C. §§ 102 and 103 may not be
substituted for the issue of subject matter eligibility under 35 U.S.C. § 101.
Mayo, 566 U.S. at 91.
In summary, Appellant's arguments have not persuaded us of error in
the Examiner's determination that the claims are directed to an abstract idea,
a fundamental economic principle of transferring funds. Further,
Appellant's arguments have not persuaded us that the Examiner erred in
finding that the claims are not: directed to an improvement in the
functioning of the computer or to other technology or other technical field;
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directed to a particular machine; directed to performing or affecting a
transformation of an article to a different state or thing; directed to using a
judicial exception in some meaningful way beyond linking the exception to a
particular technological environment such that the claim as a whole is more
than a drafting effort to monopolize the judicial exception. Nor have
Appellant's arguments persuaded us the Examiner erred in finding the
additional limitations of the claims are directed to well-understood and
conventional activities. Accordingly, we sustain the Examiner's rejection of
claims 1, 2, 4, 7 through 10, 12, 15 through 18, and 20 through 23 under 35
U.S.C. § 101 as being directed to patent ineligible subject matter.
DECISION
The decision of the Examiner to reject claims 1, 2, 4, 7 through 10,
12, 15 through 18, and 20 through 23 is affirmed.
No time period for taking any subsequent action in connection with
this appeal may be extended under 3 7 C.F .R. § 1.13 6( a )(1 )(iv).
AFFIRMED
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