Ex Parte Cicero

Patent Trial and Appeal Board

Jun 5, 2018

13939459 (P.T.A.B. Jun. 5, 2018)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE
13/939,459 07 /11/2013
63710 7590 06/07/2018
INNOVATION DIVISION
CANTOR FITZGERALD, L.P.
110 EAST 59TH STREET (6TH FLOOR)
NEW YORK, NY 10022
FIRST NAMED INVENTOR
Francesco Cicero
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.
10-2440-Cl 1892
EXAMINER
MAGUIRE, LINDSAY M
ART UNIT PAPER NUMBER
3693
NOTIFICATION DATE DELIVERY MODE
06/07/2018 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
lkorovich@cantor.com
phowe@cantor.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte FRANCESCO CICERO
Appeal2017-001264
Application 13/939,459 1
Technology Center 3600
Before BRADLEY W. BAUMEISTER, IRVINE. BRANCH, and
AMBER L. HAGY, Administrative Patent Judges.
BRANCH, Administrative Patent Judge.
DECISION ON APPEAL
Appellant appeals under 35 U.S.C. § 134(a) from a final rejection of
claims 1, 3-8, and 10-14, which are all of the claims pending in the
application.
We AFFIRM.
Technology
The application relates to "trading systems and methods . . . for
trading at, or close to, the mid-price ... of a security[, which] is on or about
the average of current bid and current offer prices." Spec. i-f 2.
1 According to Appellants, the real party in interest is GFI Group Inc. App.
Br. 3.
Appeal2017-001264
Application 13/939,459
Illustrative Claim
Claim 1, reproduced below, is illustrative of the claimed subject
matter:
1. A financial instrument transaction system, comprising:
a database configured to store financial instrument
information for a reference entity;
memory configured to store execution instructions, said
memory comprising a buffer for storing a price tick
corresponding to the reference entity; and
a processor coupled with the database and the memory, the
processor configured to execute the instructions, the instructions
configured to cause the processor to:
initiate a trading session for a predetermined
duration;
prior to and during the trading session, receive from
each one of a plurality of trader clients a trading
instruction associated with the reference entity;
establish a mid-price based on the instructions
received from the plurality of trader clients; and
during the trading session, execute trading for the
reference entity at a matching price, said matching price
being different from the mid-price, said matching price
being based on at least a first buy position and at least a
first sell position, the first buy position being at a price that
is higher than the first sell position;
wherein, when the first buy position is more distant
from the mid-price than the first sell position, the
processor is further configured to set the matching price
closer to the first sell position than to the first buy position,
and, when the first sell position is more distant from the
mid-price than the first buy position, the processor is
configured to set the matching price closer to the first buy
position than to the first sell position, wherein the
instructions are further configured to determine at the end
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Application 13/939,459
of the trading session, based on predefined criteria,
whether the trading session qualifies for a post-matching
session; and
if the trading session qualifies for a post-matching
session, providing a graphical user interface to a selected
group of traders for trading in the post-matching session,
each one of said selected group of traders being selected
when a bid or offer associated with each one of the
selected traders is equal to or less than a threshold
magnitude of price ticks, said price ticks being stored in
the buffer, distant from the matching price.
Rejections
Claims 1 and 8 stand rejected under 35 U.S.C. § 112(a) as failing to
comply with the written description requirement. Ans. 2-3.
Claims 1, 3-8, and 10-14 are rejected under 35 U.S.C. § 101 as not
being directed to patent-eligible subject matter. Ans. 3--4.
ISSUES
1. Did the Examiner err in finding claims 1 and 8 fail to comply
with the written description requirement?
2. Did the Examiner err in finding that claims 1, 3-8, and 10-14
are directed to patent ineligible subject matter?
ANALYSIS
Rejection of Claims 1and8 under 35 USC§ 112(a)
The Examiner finds the specification lacks
providing a graphical user interface to a selected group of traders
for trading in the post-matching session, each one of said selected
group of traders being selected when a bid or offer associated
with each one of the selected traders is equal to or less than a
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Application 13/939,459
threshold magnitude of price ticks ... distant from the matching
pnce.
As recited in claims 1 and 8. Ans. 3.
Appellant argues that the limitation is found at paragraphs 3 6 and 3 7
of the Specification. App. Br. 7-8.
We are persuaded by Appellant's argument. Specifically, the
Specification defines a post-matching spread setting based on 1) a maximum
spread between a mid-price and a user's bid or offer and 2) a maximum
spread between a best unfilled bid and best unfilled offer that triggers the
post-matching session. Spec. i-fi-136-37.
Accordingly, we do not sustain the Examiner's rejection of claims 1
and 8 under 35 U.S.C. § 112(a).
Rejection under 35 US.C. § 101
Section 101 defines patent-eligible subject matter as "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
"'long held that this provision contains an important implicit exception[:]
Laws of nature, natural phenomena, and abstract ideas are not patentable."'
Ass 'nfor Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. 576, 589
(2013) (internal brackets omitted) (quoting Mayo Collaborative Servs. v.
Prometheus Labs., Inc., 566 U.S. 66, 70 (2012)).
To distinguish "patents that claim laws of nature, natural phenomena,
and abstract ideas from those that claim patent-eligible applications of those
concepts," the Supreme Court has set up an analytical framework. Alice
Corp. v. CLS Bankint'l, 134 S. Ct. 2347, 2355 (2014) (citing Mayo, 566
U.S. at 71-73). In the first step of the analysis, we determine whether the
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Application 13/939,459
claims at issue are "directed to" a judicial exception, such as an abstract
idea. Alice, 134 S. Ct. at 2355. If not, the inquiry ends. Thales Visionix Inc.
v. US., 850 F.3d 1343, 1346 (Fed. Cir. 2017); Enfzsh, LLC v. Microsoft
Corp., 822 F.3d 1327, 1339 (Fed. Cir. 2016). If the claims are determined to
be directed to an abstract idea, then we consider under step two whether the
claims contain an "inventive concept" sufficient to "transform the nature of
the claim into a patent-eligible application." Alice, 134 S. Ct. at 2355
(quotations and citation omitted).
Noting that the two stages involve "overlapping scrutiny of the
content of the claims," the Federal Circuit has described "the first-stage
inquiry" as "looking at the 'focus' of the claims, their 'character as a
whole,"' and "the second-stage inquiry (where reached)" as "looking more
precisely at what the claim elements add-specifically, whether, in the
Supreme Court's terms, they identify an 'inventive concept' in the
application of the ineligible matter to which (by assumption at stage two) the
claim is directed." Electric Power Grp, LLC v. Alstom S.A., 830 F.3d 1350,
1353 (Fed. Cir. 2016). In considering whether a claim is directed to an
abstract idea, we acknowledge, as did the Court 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. We, therefore, look
to whether the claims focus on a specific means or method that improves the
relevant technology or are instead directed to a result or effect that in itself is
the abstract idea and merely invoke generic processes and machinery. See
Enfzsh, 822 F.3d at 1336.
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Application 13/939,459
Step One: Whether the Claims Are Directed to a Patent-Ineligible
Concept (Abstract Idea)
Claim 1, which is representative of the claims before us, 2 is directed
to a "financial instrument transaction system," including a database,
memory, a processor, and instructions that program the processor to conduct
trading sessions following specific rules. The Examiner concludes that "the
claims are directed towards implementing post-matching trading," an
abstract idea, namely "(i) a fundamental economic practice and/or (ii) a
mathematical relationship or formula." Ans. 3, 5.
Appellant argues as follows:
There is no evidence provided that this is a fundamental
economic practice. If it were one, then certainly the Examiner
could have provided at least one prior art rejection. Even the
Court in Alice provided evidence to support their finding of
abstractness. No prior art was presented at all in the Office
Action, and that is evidence that this allegedly abstract idea is not
in fact a fundamental economic practice. Moreover,
fundamentality alone is not sufficient to rise to the level
abstractness. An economic practice must also be long prevalent
before it can be deemed abstract according to the Court in Alice.
The Examiner made no allegation or showing regarding long
prevalence and therefore has failed to follow required procedure.
App. Br. 9--10.
This line of argument does not persuade us of error. The thrust of
Appellant's invention is directed to securities trading. See Spec. i-f2 ("this
2 Appellant collectively argues the rejection of all claims with regard to the
Examiner's rejection of claim 1 under 35 U.S.C. § 101. Separate
patentability is not argued for independent claim 8, or dependent claims 3-7,
or 10-14. See App. Br. 9-11; Reply Br. 2--4. Therefore, based on
Appellant's arguments, we decide the appeal of all pending claims based on
claim 1 alone. See 37 C.F.R. § 41.37(c)(l)(iv).
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invention relates to trading systems and methods for trading at, or close to,
the mid-price[, which] is on or about the average of current bid and current
offer prices."). Appellant concedes securities trading was a long-prevalent
economic practice. See, e.g., Reply Br. 3 ("Prior to electronic trading, open
outcry trading was popular.").
Appellant also argues that "[t]he claims here[,] as the claims in
Enfish[,] are directed to the improvement of computer functionality and not
an abstract idea at all." Reply Br. 2. Appellant makes additional arguments
premised on the claims being directed to an improvement in computer
technology. Id. at 2--4.
We are not persuaded that the claims improve computer functionality.
Similarly to the claims in OIP Technologies, Inc. v. Amazon. com, Inc., 788
F. 3d 1359 (Fed. Cir. 2015), cert. denied, 136 S. Ct. 701 (2011), which were
directed to offer-based price optimization, the claims here are directed to
conducting a trading session based on offers and bids.
The present claims are distinguishable from the claims in DDR
Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245 (Fed. Cir. 2014). The
claims in DDR Holdings recited a specific manipulation of a general-
purpose computer such that the claims do not rely on a "computer network
operating in its normal, expected manner." Id. at 1258. The present claims,
in contrast, rely on a computer to perform routine tasks that implement
instructions for trading. See OIP 788 F.3d at 1363 ("[R]elying on a
computer to perform routine tasks more quickly or more accurately is
insufficient to render a claim patent eligible.").
Accordingly, we are persuaded the claims are directed to an abstract
idea.
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Application 13/939,459
Because we agree with the Examiner, at step one of the Alice analysis,
that the claims are directed an abstract idea, we tum to the second step of the
Alice analysis. To that end, we determine whether the additional elements of
the claims transform them into patent-eligible subject matter.
Step Two: Whether Additional Elements Transform The Abstract Idea
Into Patent-Eligible Subject Matter
The Examiner finds as follows:
The claims do not include limitations that are "significantly
more" than the abstract idea because the claims do not include an
improvement to another technology or technical field, an
improvement to the functioning of the computer itself, or
meaningful limitations beyond generally linking the use of an
abstract idea to a particular technological environment. Note that
the limitations, in the instant claims, are done by the generically
recited database. The limitations are merely instructions to
implement the abstract idea on a computer and require no more
than a generic computer to perform generic computer functions
that are well-understood, routine and conventional activities
previously known to the industry.
Ans. 3--4.
Appellant argues that the claims, like those in DDR, provide an
improvement in computer technology, which amounts to more than an
abstract idea, and also do not attempt to preempt the idea of post matching
trading. Reply Br. 2--4. We are not persuaded.
Rather, we agree with the Examiner that the computer components
recited in the claims do not amount to significantly more than the underlying
abstract idea. Embedding an abstract idea (e.g., post-matching trading) in
technology (e.g., a database, memory, and a processor) is merely "an
attempt[] to limit the use of the abstract idea to a particular technological
environment," which "does not transform an otherwise abstract idea into
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Application 13/939,459
patent-eligible subject matter." Ultramercial, Inc. v. Hulu, LLC, 772 F.3d
709, 716 (Fed. Cir. 2014) (alteration in original) (quoting Alice, 134 S. Ct. at
2358); see Intellectual Ventures I LLC v. Capital One Bank (USA), 792 F.3d
1363, 1370-71 (Fed. Cir. 2015). 3
We have considered all of the Appellant's remaining arguments and
have found them unpersuasive. Accordingly, because claim 1 is directed to
an abstract idea and does not present an "inventive concept," we sustain the
Examiner's determination that all pending are directed to ineligible subject
matter under 35 U.S.C. § 101.
DECISION
For the reasons above, we affirm the Examiner's decision rejecting
claims 1, 3-8, and 10-14.
No time period for taking any subsequent action in connection with
this appeal may be extended under 37 C.F.R. § 1.136(a). See 37 C.F.R.
§ 41.50(±).
AFFIRMED
3 See also FairWarning IP, LLC v. Iatric Systems, Inc., 839 F.3d 1089, 1096
(Fed. Cir. 2016) (citing DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d
1245, 1256 (Fed. Cir. 2014)) ("[T]he use of generic computer elements like
a microprocessor or user interface do not alone transform an otherwise
abstract idea into patent-eligible subject matter.").
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