Ex Parte Hammour et alDownload PDFPatent Trial and Appeal BoardJun 24, 201410406010 (P.T.A.B. Jun. 24, 2014) Copy Citation 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. 10/406,010 04/03/2003 Mohamad L. Hammour Guide-P0-03 5397 28710 7590 06/24/2014 PETER K. TRZYNA, ESQ. P O BOX 7131 CHICAGO, IL 60680 EXAMINER LOFTUS, ANN E ART UNIT PAPER NUMBER 3692 MAIL DATE DELIVERY MODE 06/24/2014 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 MOHAMAD L. HAMMOUR, HARVEY E. WEINER, and JAMES M. MILANO ____________________ Appeal 2012-001779 Application 10/406,010 Technology Center 3600 ____________________ Before: MURRIEL E. CRAWFORD, ANTON W. FETTING, and MICHAEL W. KIM, Administrative Patent Judges. CRAWFORD, Administrative Patent Judge. DECISION ON APPEAL STATEMENT OF THE CASE Appellants seek our review under 35 U.S.C. § 134 from the Examiner’s final rejection of claims 1–74. We have jurisdiction under 35 U.S.C. § 6(b). Appeal 2012-001779 Application 10/406,010 2 SUMMARY OF THE DECISION We affirm and enter a new ground of rejection pursuant to 37 C.F.R. § 41.50(b). BACKGROUND Claim 1 is representative of the claims on appeal. 1. A method of using an apparatus, the method comprising the steps of: entering, into a computer system, data corresponding to an application for a Sharia-compliant, regarding a prohibition against interest, financing arrangement for property, the financing arrangement including providing a consumer with funds to finance the property, creating joint rights of ownership in the property in the consumer and in a co-owner, the co-owner being a limited liability co-owner, and having the consumer make at least one payment to repay the funds, wherein each said payment includes a profit payment to the co-owner and an acquisition payment to the co-owner, and each said acquisition payment increases the consumer's ownership portion of the property and simultaneously decreases the co-owner's ownership portion of the property, and transferring full ownership of the property to the consumer alone after full repayment of the funds as agreed between the consumer and the limited liability co-owner; and processing the entered data, with said computer system, in carrying out the financing arrangement, including track[ing] a plurality of said acquisition payments made according to the Sharia-compliant financing arrangement, said tracking including tracking increases in the consumer's ownership portion of the property and corresponding decreases in the co- owner's ownership portion of the property according to the Sharia-compliant financing arrangement Appeal 2012-001779 Application 10/406,010 3 so as to carry out a sale, which does not involve payment of interest, of some, but not all, of the co-owner's rights under the Sharia-compliant financing arrangement to a secondary market. Appellants appeal the following rejections: Claims 26–40 and 64–74 are rejected1 under 35 U.S.C. § 101 as reciting non-statutory subject matter. Claims 5–7 and 27 are rejected under 35 U.S.C. § 112, first paragraph, as failing to comply with the written description requirement. Claims 1–74 are rejected under 35 U.S.C. § 112, second paragraph, as being indefinite. Claims 1–24, 26–38, 40–53, and 64–74 are rejected under 35 U.S.C. § 102(b) as anticipated by Oppenheimer (US 5,983,206, iss. Nov. 9, 1999). Claims 1–24, 26–38, 40–53, and 64–74 are rejected under 35 U.S.C. § 103(a) as unpatentable over Oppenheimer. Claims 1–23, 26–38, 40–58, 61–66, and 68–74 are rejected under 35 U.S.C. § 103(a) as unpatentable over Oppenheimer, Douglas Diamond, Islamic Housing Finance, 15 Housing Finance International 26–33 (Sep. 2000) (“Diamond”), and Graff (US 6,192,347 B1, iss. Feb. 20, 2001). Claims 24, 25, 39, and 67 are rejected under 35 U.S.C. § 103(a) as unpatentable over Oppenheimer, Diamond, Graff, and Salzmann (US 6,711,554 B1, iss. Mar. 23, 2004). 1 The Answer, at page 4, states that claims 1–25 are rejected under 35 U.S.C. § 101, but at pages 3–4 and 5 articulate that these claims are not rejected under 35 U.S.C. § 101. Appeal 2012-001779 Application 10/406,010 4 Claims 59 and 60 are rejected under 35 U.S.C. § 103(a) as unpatentable over Oppenheimer, Diamond, Graff, and Stratigos (US 6,189,009 B1, iss. Feb. 13, 2001). ANALYSIS Patentable subject matter of claims 1–40 and 64–74 The Appellants argue that the Examiner’s reasoning for not rejecting claims 1–25 under 35 U.S.C. § 101 should apply to method claims 26–40 and 64–74, such that none would be found to recite ineligible subject matter. (Br. 32). We find this argument unpersuasive, for the following reasons. Each of independent claims 1, 26, 64, and 70 recite two method steps directed to entering and processing data, as well as limitations reciting the terms of a financing arrangement to which the entered data corresponds. The limitations of “entering, into a computer system, data corresponding to an application for a . . . financing arrangement” represents mere data gathering, considered insignificant extra-solution activity. See Bilski v. Kappos, 545 F.3d 943, 963 (Fed. Cir. 2008) (en banc), aff'd sub nom Bilski v. Kappos, 130 S. Ct. 3218 (2010) (characterizing data gathering steps as insignificant extra-solution activity). The term “processing,” recited in the other method step of the independent claims, is not defined in the Specification. The Specification describes by example that the processing may encompass creating a table of payments (Spec. 32, ll. 3–5), as shown in Table 1, below: Appeal 2012-001779 Application 10/406,010 5 Table 1, page 39 of the Specification, showing an “OWNERSHIP SCHEDULE” Several possible processing activities are described throughout the Specification. However, limitations appearing in the specification but not recited in the claim are not read into the claim. E-Pass Techs., Inc. v. 3Com Corp., 343 F.3d 1364, 1369 (Fed. Cir. 2003). We construe broadly each of the limitations of “processing the entered data, in carrying out the financing arrangement . . .” as encompassing the step of outputting a table of entered data, as shown by example in Table 1, above. The claim only limits the “processing” by reciting “tracking including tracking increases in the consumer’s ownership portion of the property and corresponding decreases in the co-owner’s ownership portion of the property.” This broadly encompasses no more than merely accepting as input the consumer and co- owner ownership portions, and then printing them out in a type of amortization table, as shown in Table 1, above. The output of the tracking is merely post-solution activity, because the thrust of the claim, aside from the two insignificant extra-solution activity steps, is the recitation of the terms of the financing agreement. As a result, this output step is construed as insignificant post-solution activity. “Flook stands for the proposition that the prohibition against patenting abstract ideas ‘cannot be circumvented by attempting to limit the use of the formula to a particular technological Appeal 2012-001779 Application 10/406,010 6 environment’ or adding ‘insignificant postsolution activity.” Bilski, 130 S. Ct. at 3230 (quoting Diamond v. Diehr, 450 U.S. 175, 191–92 (1981)). The Examiner distinguishes between claim 1, which recites “processing the entered data,” and claims 26, 64, and 70, which recite “processing at least some of the entered data.”2 (Answer 22–23). However, in all four claims, the precise nature of the “entered data” is unspecified. The processing of the data in claim 1 may mean merely printing out data. Therefore, we find nothing significant between “processing” all the unspecified data of claim 1 and “processing” some of the unspecified data of the other claims. The last portion of the “processing” steps recites “so as to carry out a sale . . . .” As support for this limitation, the Appellants direct us to the Specification, page 24, lines 7–8 (Br. 5, 12, 27, 29–30) and page 17, lines 11–14 (Id. at 27). There the Specification describes an agreement that is prepared for signature at closing that “assigns the majority of the co-owner’s rights in the property to the financier . . . .” (Spec. 17, ll. 11–15; see also id. at 24, ll. 7–8). Therefore, we construe the language “so as to carry out a sale . . .” as encompassing the mere printing of an additional agreement, without requiring a sale to take place. In between the two method steps in each independent claim, the various limitations describing the terms of the financing arrangement are not substantively tied to significant method steps. We construe them as mere content, undeserving of patentable weight. For example, the substrate “processing” step is not recited as acting in any substantive way on any 2 Claims 64 and 70 use the word “said” in place of the word “the” in claim 26. Appeal 2012-001779 Application 10/406,010 7 particular data that may be reflected in the terms of the agreement. As such, we find that the recited terms of the financing arrangement are non- functional descriptive material. See In re Ngai, 367 F.3d 1336, 1338 (Fed. Cir. 2004). Patentable weight need not be given to descriptive material absent a new and unobvious functional relationship between the descriptive material and the substrate. See In re Lowry, 32 F.3d 1579, 1582–83 (Fed. Cir. 1994). The method claims thus recite two steps considered insignificant extra-solution activity, and several limitations considered non-functional descriptive material. Based on this, we affirm the rejection of these claims under 35 U.S.C. § 101 as reciting ineligible subject matter. This is because the independent method claims each recite a combination of computerized, insignificant extra-solution activity steps, and a collection of abstract contractual terms. We also affirm the rejection of dependent claims 27–40, 65–69, and 71–74, which were not separately argued. Because our analysis includes claim 1, we enter a new ground of rejection of claim 1 under 35 U.S.C. § 101 as reciting ineligible abstract ideas as their subject matter. We find nothing in dependent claims 2–25 that does more than introduce more abstract mental thought steps, or alters the terms of the non-functional financing agreement, so we also enter a new ground of rejection of claims 2–25 under 35 U.S.C. § 101 as reciting ineligible abstract ideas as their subject matter. Appeal 2012-001779 Application 10/406,010 8 Rejection of Claims 5, 6, 7, and 27 under 35 U.S.C. § 112, First Paragraph The Examiner rejects claims 5–7 and 27 for lack of written description support for introducing “the co-owner is a legal entity with pass- through tax attributes and limited liability protection under law in effect as of April 3, 2003” (Answer 6, 23). The Appellants argue the amended claims have written description support because the recited date matches the filing date of the application. (Br. 33). We agree with the Appellants. First, a claim is interpreted in light of what the ordinary artisan would understand as of the filing date. Therefore, one having ordinary skill in the art would understand the claim to mean the claim refers to the “law in effect as of April 3, 2003,” because that is the filing date. The “ordinary and customary meaning of a claim term is the meaning that the term would have to a person of ordinary skill in the art in question at the time of the invention, i.e., as of the effective filing date of the patent application.” Phillips v. AWH Corp., 415 F.3d 1303, 1313 (Fed. Cir. 2005) (en banc) (internal citations omitted). In addition, the Specification describes “the limited liability co-owner is treated as a pass-through entity or disregarded entity for federal tax purposes, thereby eliminating federal tax liability and preferably tax return filings all together, such as where a single member LLC is the limited liability co-owner” (Spec. 13, ll. 7–10), which provides adequate support that the Appellants had possession of the invention recited in the claims at the time of filing. The test for sufficiency is whether the disclosure of the application relied upon reasonably conveys to those skilled in the art that the inventor had possession of the claimed subject matter as of the filing date. Appeal 2012-001779 Application 10/406,010 9 Ariad Pharms., Inc. v. Eli Lilly and Co., 598 F.3d 1336, 1351 (Fed. Cir. 2010) (quoting Ralston Purina Co. v. Far-Mar-Co, Inc., 772 F.2d 1570, 1575 (Fed. Cir. 1985)). For these reasons, we will not sustain the rejection under 35 U.S.C. § 112, first paragraph. Rejection of Claims 1–40 and 64–74 under 35 U.S.C. § 112, Second Paragraph The Examiner rejects claims 1–40 and 64–74 as indefinite on the basis of the term “Sharia-compliant,” recited in independent claims 1, 26, 64, and 70. The Examiner rejects independent claims 41 and 54 as indefinite on the basis of the phrase “which does not involve payment of interest.” The Examiner finds that one of ordinary skill in the art of using “computers that handle mortgages . . . would not know whether an embodiment was Sharia compliant or not, thus he or she would not be properly apprised of the scope of the claim, especially since interest is undefined.” (Answer 7). Additionally, the Examiner finds “[i]nterest is not defined, so the absence of interest cannot be determined.” (Id.) We are not persuaded by the Appellants’ argument that the rejection is in error on the basis that the Examiner has not shown the claims are “not amenable to construction or are insolubly ambiguous.” (Br. 33–34). The test for definiteness under 35 U.S.C. § 112, second paragraph, is whether “those skilled in the art would understand what is claimed when the claim is read in light of the specification.” Orthokinetics, Inc. v. Safety Travel Chairs, Inc., 806 F.2d 1565, 1576 (Fed. Cir. 1986) (citations omitted). In response to an indefiniteness rejection, the “satisfactory response by the applicant can take the form of a modification of the Appeal 2012-001779 Application 10/406,010 10 language identified as unclear, a separate definition of the unclear language, or, in an appropriate case, a persuasive explanation for the record of why the language at issue is not actually unclear.” In re Packard, 2013-1204, 2014 WL 1775996, at *3 (Fed. Cir. May 6, 2014). The Office does not rely on the “insolubly ambiguous” standard, used in the litigation of issued patents, in indefiniteness rejections issued during prosecution of applications. In addition, the Appellants argue they have “overcome the prima facie case with Applicant[s’] evidence of the paper by Mufti Taqi Usmani titled ‘The Historic Judgment on Interest,’ a 14 Ramadan 1420 decision of the Shariah Appellate Bench of the Supreme Court of Pakistan.” (Br. 34). We are also not persuaded that the Usmani paper persuasively explains why the claim language is not unclear. At over 75 pages in length, including numerous citations in Arabic, the Usmani paper is apparently a summary of an 1100 page decision, according to the first page of the paper. The Appellants have not supplied any particular citation, within this enormous amount of material, that precisely defines “interest” or that precisely defines a financing agreement as being “Sharia-compliant.” In addition, the first page of the paper asserts the referenced opinion stands for “banning interest in all its forms and by whatever name it may be called.” (Usmani, p. 1). The Specification, however, describes by example that there are “instances where payments characterized as rent between the parties have been re-characterized as interest by the courts and the IRS . . . .” (Spec. 4, ll. 4–7). Inasmuch as the Specification also describes the “profit payment is the amount that the consumer pays the co-owner for the consumer’s use of the property,” it is conceivable that claimed “profit payment” for use of the property would be redefined as “interest.” As such, Appeal 2012-001779 Application 10/406,010 11 we doubt that one of ordinary skill in the art of using computers that handle mortgages, has the ability to understand, or even read, the entire Usmani paper, or the decision it describes, or ascertain whether the “profit payment” claimed “does not involve [the] payment of interest” (claims 41 and 54), or is actually interest “by whatever name it may be called” (Usmani). Therefore, we affirm the rejection of claims 1–40 and 64–74 as indefinite, because each claim includes either the indefinite term “Sharia- compliant,” or the indefinite phrase “which does not involve payment of interest.” Rejection of Claims 41–63 under 35 U.S.C. § 112, Second Paragraph The Examiner finds the last clause of claims 41 and 54 indefinite. Claim 41 recites “processing the received data, with the computer system so as to carrying out a sale, which does not involve payment of interest, of some, but not all, of the co-owner's rights to a secondary market.” Claim 54 recites “a system comprised of at least one of said computers operates so as to carry out a sale, which does not involve payment of interest, of some, but not all, of the co-owner's rights to a secondary market.” The Examiner asserts “Interest is not defined, so the absence of interest cannot be determined.” (Answer 7, 25–26). Appellants argue this is addressed in their arguments about the indefiniteness of the term “Sharia- compliant.” (Br. 39). Apparatus claims 41–63, however, do not recite the term “Sharia-compliant.” Although interest is not specifically defined in the Specification, Merriam Webster’s Collegiate Dictionary (10th ed.) defines interest as “a: a charge for borrowed money generally a percentage of the amount borrowed b: the profit in goods or money that is made on invested capital c: an excess above what is due or expected.” We recognize that, Appeal 2012-001779 Application 10/406,010 12 absent reference to Sharia law, one of ordinary skill in the art of using computers that handle mortgages would understand the term “interest.” The Examiner also asserts that “Processing and operating are very broad, and data is very broad . . . [which] leaves the scope of the claim unclear.” (Answer 7). Appellants, however, correctly point out that “[b]readth is not indefiniteness.” (Br. 39). The Examiner also asserts the claim is indefinite as to whether a sale is required or merely anticipated. (Answer 7, 27–28). However, we construe the claim language of “so as to carrying/carry out a sale” to mean “the mere printing of an additional agreement, without requiring a sale to take place,” as set forth above. For these reasons, we will not sustain the rejection of claims 41–63 under 35 U.S.C. § 112, second paragraph, as indefinite. Rejections of Claims 41–63 under 35 U.S.C. § 103(a) Appellants first argue that the Examiner has not responded to Appellants’ “Sec 132 argument” in which the “Examiner was required to provide information as to how Oppenheimer could be modified to reach Applicant’s claims (e.g., be Sharia compliant) . . . .” (Br. 46–47). We are not persuaded by this Appellants’ argument, as to claims 41–63, because the claims do not recite “Sharia compliant.” We are also not persuaded by Appellants’ argument that the claims also require a sale (Br. 47–48, 50). As we set forth above, instead of requiring a sale take place, we construe the claim language of “so as to carrying/carry out a sale” to mean “the mere printing of an additional agreement, without requiring a sale to take place.” In addition, Oppenheimer discloses both the impact of certain aspects on “mortgage Appeal 2012-001779 Application 10/406,010 13 capital markets” (col. 2, ll. 62–65), as well as a mortgage “which can be separately marketable or collateralized within mortgage-backed securities” (col. 4, ll. 33–37). In our view, this disclosure meets the claim language of “a sale, which does not involve payment of interest, of some, but not all, of the co-owner's rights to a secondary market” in claims 41 and 54. Appellants next argue that the Examiner has failed to provide a proper reason to combine Oppenheimer, Diamond, and Graff, because the “reason must stem from some teaching, suggestion, or implication in the prior art as a whole or knowledge generally available to one having ordinary skill in the art.” (Br. 48). To the extent Appellants seek an explicit suggestion or motivation in the reference itself, this is no longer the law in view of the Supreme Court’s recent holding in KSR Int’l Co. v. Teleflex, Inc., 550 U.S. 398, 419 (2007). In addition, the Examiner reasonably sets forth a rationale to adapt Oppenheimer with the Sharia-compliant terms of Diamond “in order to build a structure with access to venture capital.” (Answer 15). The Examiner also reasonably sets forth a rationale to substitute a limited liability part in Graff into the parties of Oppenheimer “in order to lessen the risk of loss for the co-owner and entice the co-owner into providing funds.” (Answer 14). We are not persuaded by Appellants’ argument that modifying Oppenheimer with the Sharia-compliant terms of Diamond would “necessitate[] destroying Oppenheimer’s use of interest by imposing the above-noted claim requirements on Oppenheimer.” (Br. 49–50). “[I]t is not necessary that the inventions of the references be physically combinable to render obvious the invention under review.” In re Sneed, 710 F.2d 1544, 1550 (Fed. Cir. 1983). The relevant inquiry is whether the claimed subject Appeal 2012-001779 Application 10/406,010 14 matter would have been obvious to those of ordinary skill in the art in light of the combined teachings of those references. See In re Keller, 642 F.2d 413, 425 (CCPA 1981). “Combining the teachings of references does not involve an ability to combine their specific structures.” In re Nievelt, 482 F.2d 965, 968 (CCPA 1973). Appellants argue that because Oppenheimer uses the term “interest,” the rejection is “improper,” teaches away, and would change the function of Oppenheimer. (Br. 51–53). We are not persuaded by Appellants’ argument, because the “interest” in claims 41 and 54 relates to the sale to a secondary market. Oppenheimer discloses the utilization of a secondary market (col. 2, ll. 62–65; col. 4, ll. 33–37). If the terms of the underlying mortgage relied on Diamond’s non-interest terms, a sale to the secondary market could also be based on similar non-interest-bearing terms, without destroying the other teachings of Oppenheimer. For these reasons, we affirm the rejection under 35 U.S.C. § 103(a) of claims 41 and 54, as well as dependent claims 42–53, 55–58, and 61–63, which were not separately argued. We also affirm the rejection under 35 U.S.C. § 103(a) of claims 59 and 60, which was not separately argued. Because we affirm the rejection under 35 U.S.C. § 103(a), we do not need to reach the rejection under 35 U.S.C. § 102(b) of claims 40–53. Rejection of Claims 1–40 and 63–74 under 35 U.S.C. §§ 102(b) and 103(a) We do not reach the merits of the anticipation or obviousness rejections of the claims. A rejection should not be based on “speculations and assumptions.” In re Steele, 305 F.2d 859, 862 (CCPA 1962). “All words in a claim must be considered in judging the patentability of that Appeal 2012-001779 Application 10/406,010 15 claim against the prior art. If no reasonably definite meaning can be ascribed to certain terms in the claim, the subject matter does not become obvious— the claim becomes indefinite.” In re Wilson, 424 F.2d 1382, 1385 (CCPA 1970). Speculations and assumptions would be required to decide the meaning of the terms employed in the claims and the scope of the claims. Therefore, we conclude that the indefiniteness of claims prevents us from reaching the issues of anticipation or obviousness. Consequently, we reverse pro forma the anticipation and obviousness rejections. It should be understood, however, that our decision in this regard is based solely on the indefiniteness of the claimed subject matter and does not reflect the adequacy or the inadequacy of the prior art evidence applied in support of the rejection before us. Once definite claims are presented, the Examiner is free to apply the same, different, or additional prior art if the Examiner so chooses. DECISION We affirm the rejection of claims 26–40 and 64–74 under 35 U.S.C. § 101 as reciting ineligible subject matter. We reverse the rejection of claims 5–7 and 27 under 35 U.S.C. § 112, first paragraph. We affirm the rejection of claims 1–40 and 64–74 under 35 U.S.C. § 112, second paragraph, as indefinite. We reverse the rejection of claims 41–63 under 35 U.S.C. § 112, second paragraph, as indefinite. We affirm the rejection of claims 40–58 and 61–63 under 35 U.S.C. § 103(a) over Oppenheimer, Diamond, and Graff. Appeal 2012-001779 Application 10/406,010 16 We affirm the rejection of claims 59 and 60 under 35 U.S.C. § 103(a) over Oppenheimer, Diamond, Graff, and Stratigos. We reverse pro forma the rejections under 35 U.S.C. §§ 102(b) and 103(a) of claims 1–40 and 64–74. We enter a new ground of rejection under 35 U.S.C. § 101 of claims 1–25 as reciting ineligible subject matter. This decision contains new grounds of rejection pursuant to 37 C.F.R. § 41.50(b) (2008). 37 C.F.R. § 41.50(b) provides “[a] new ground of rejection pursuant to this paragraph shall not be considered final for judicial review.” 37 C.F.R. § 41.50(b) also provides that the Appellants, WITHIN TWO MONTHS FROM THE DATE OF THE DECISION, must exercise one of the following two options with respect to the new ground of rejection to avoid termination of the appeal as to the rejected claims: (1) Reopen prosecution. Submit an appropriate amendment of the claims so rejected or new evidence relating to the claims so rejected, or both, and have the matter reconsidered by the examiner, in which event the proceeding will be remanded to the examiner . . . . (2) Request rehearing. Request that the proceeding be reheard under § 41.52 by the Board upon the same record . . . . 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. § 1.136(a)(1)(iv). AFFIRMED; 37 C.F.R. § 41.50(b) Appeal 2012-001779 Application 10/406,010 17 hh Copy with citationCopy as parenthetical citation