Ex Parte Homoki

Patent Trial and Appeal Board

Jul 5, 2018

13624947 (P.T.A.B. Jul. 5, 2018)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE
13/624,947 09/23/2012
23505 7590 07/09/2018
CONLEY ROSE, P.C.
575 N. Dairy Ashford Road
Suite 1102
HOUSTON, TX 77079
FIRST NAMED INVENTOR
David J. Homoki
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.
7006-00700 4051
EXAMINER
CAMPEN, KELLY SCAGGS
ART UNIT PAPER NUMBER
3691
NOTIFICATION DATE DELIVERY MODE
07 /09/2018 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):
pathou@conleyrose.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte DAVID J. HOMOKI
Appeal2017-004319
Application 13/624,94 7
Technology Center 3600
Before JOHN A. JEFFERY, LARRY J. HUME, and
CATHERINE SHIANG, Administrative Patent Judges.
JEFFERY, Administrative Patent Judge.
DECISION ON APPEAL
Appellant 1 appeals under 35 U.S.C. § 134(a) from the Examiner's
decision to reject claims 1-18. We have jurisdiction under 35 U.S.C. § 6(b ).
We affirm.
STATEMENT OF THE CASE
Appellant's invention determines whether customers are approved for
a sale that is paid for with multiple payments over a sales period, where the
approval is based on the customer's financial information, income, and
1 Appellant identifies the real party in interest as David J. Homoki. App.
Br. 3.
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Application 13/624,947
willingness to pay. See generally Abstract; Spec. i-fi-f 19--29. Claim 1 is
illustrative:
1. A method comprising:
receiving a request to approve a customer for a sale to be
paid for with multiple payments over a sales period;
providing a web-form to collect information from the
customer;
collecting financial information of the customer by way of
the web-form;
calculating a line of willingness-to-pay, the calculating by a
computer system, where the line of willingness-to-pay is
calculated based on a returns report and sales reported on a
given day;
calculating a value indicative of modified income of the
customer; and then
determining whether the customer is approved for the sale
based on the line of willingness-to-pay, the value indicative of
modified income of the customer, and the financial information
of the customer; if the customer is approved determining terms
of a payment plan for the sale; and
rendering for display, the terms of the payment plan, on
the web-form.
THE REJECTIONS
The Examiner rejected claims 1-18 under 35 U.S.C. § 101 as directed
to ineligible subject matter. Ans. 2---6. 2
The Examiner rejected claims 1-18 under 35 U.S.C. § 103 as
unpatentable over Abrahams (US 2012/0296806 Al; Nov. 22, 2012) and
Nemat Shafik, Economic Development and Environmental Quality: An
2 Throughout this opinion, we refer to (1) the Appeal Brief filed August 12,
2016 ("App. Br."); (2) the Examiner's Answer mailed November 29, 2016
("Ans."); and (3) the Reply Brief filed January 16, 2017 ("Reply Br.").
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Econometric Analysis, 46 OXFORD ECONOMIC PAPERS 757-73 (Oct. 1994)
("Shafik"). Ans. 7-12.
THE INELIGIBILITY REJECTION
The Examiner finds that the claimed invention is directed to an
abstract idea, namely creating a contract for payment. Ans. 2, 12-13.
According to the Examiner, the claimed elements do not add significantly
more to the abstract idea to render the claimed invention patent-eligible.
Ans. 3---6, 13-16.
Appellant argues that the claims are not directed to an abstract idea,
but rather a particular and concrete method of handling a request to approve
a customer to purchase an item, particularly given the Specification's
explanation ofhow (1) the recited "line of willingness-to-pay" is calculated,
and (2) the claimed rules are used to calculate a customer's specific payment
plan. App. Br. 10-13; Reply Br. 1-3. Appellant adds that even if claim 1
was directed to an abstract idea, the claim nevertheless recites additional
elements that add significantly more to the abstract idea by, among other
things, (1) receiving a request to approve a customer for sale, (2)
determining whether the customer is approved for sale based on the recited
calculated line of willingness-to-pay, and (3) rendering the payment plan's
terms on a web-form. App. Br. 13-16; Reply Br. 1--4. According to
Appellant, not only does claim 1 recite specific rules that improve methods
of calculating a customer's payment plan, but the claim also does not pre-
empt all ways of creating a contract for payment. App. Br. 16; Reply
Br. 1--4.
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ISSUE
Has the Examiner erred in rejecting claims 1-18 by concluding that
they are directed to ineligible subject matter under § 101? This issue turns
on whether the claimed invention is directed to a patent-ineligible abstract
idea and, if so, whether the recited elements---considered individually and as
an ordered combination-transform the nature of the claims into a patent-
eligible application of that abstract idea.
ANALYSIS
To determine whether claims are patent eligible under § 101, we apply
the Supreme Court's two-step test articulated in Alice Corp. Proprietary Ltd.
v. CLS Bank International, 134 S. Ct. 2347 (2014). First, we determine
whether the claims are directed to a patent-ineligible concept: laws of nature,
natural phenomena, and abstract ideas. Id. at 2354--55. If so, we then
proceed to the second step and examine the claim's elements-both
individually and as an ordered combination-to determine whether the claim
contains an "inventive concept" sufficient to transform the claimed abstract
idea into a patent-eligible application. Id. at 2357.
Alice Step One
Applying Alice step one, we agree with the Examiner that the claimed
invention is directed to an abstract idea, namely creating a contract for
payment. Ans. 2, 12-13. Independent claim 1 recites, in pertinent part, (1)
receiving a request to approve a customer for a sale to be paid for with
multiple payments over a sales period, (2) collecting the customer's financial
information via a web-form, and (3) calculating a line of willingness-to-pay
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based on a returns report and sales reported on a given day. Claim 1 further
recites determining whether the customer is approved for the sale based on
(1) the line of willingness-to-pay, (2) a calculated value indicating the
customer's modified income, and (3) the customer's financial information.
Also, a payment plan's terms are determined and rendered for display on the
web-form.
As noted above, a key aspect of this approval process is calculating a
"line of willingness-to-pay" based on (1) a "returns" report, and (2) sales
reported on a given day. According to the Specification, a "return" is an
electronic debit or physical check presented to a customer's bank and
subsequently rejected for payment. Spec. i-f 11. Appellant's Figure 5 graphs
(1) the total percentage of sales that are returns, and (2) the customer's
willingness to pay over a 90-day period, where the two associated lines 502,
504 are linear regressions calculated from data in Figure 4. Id. i-f 25. As
shown in Figure 5, the percentage of returns increases during the sales
period, thus indicating that a customer's desire to continue to pay for a
possessed item declines over time. Id. i-f 26. This declining desire is shown
in line 504 whose downward slope reflects the customer's progressively-
declining willingness to pay over time. Id. i-f 27.
In essence, Appellant's claimed invention creates a payment contract
by approving the customer based on certain customer-related factors, namely
(1) the line of willingness-to-pay, (2) a calculated value indicating the
customer's modified income, and (3) the customer's financial information.
Despite Appellant's arguments to the contrary (App. Br. 10-13; Reply
Br. 1-3), we agree with the Examiner that claim 1 is directed to an abstract
idea, namely creating a payment contract, which is a fundamental economic
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and business practice. See Ans. 2-3, 12-13. Such fundamental economic
and business practices are often held to be abstract. See, e.g., Alice, 134 S.
Ct. at 2356 (holding the concept of intermediated settlement is an abstract
idea directed to a "fundamental economic practice long prevalent in our
system of commerce") (citation omitted); see also buySAFE v. Google, Inc.,
765 F.3d 1350, 1353-54 (Fed. Cir. 2014) (citing cases where contractual
relations at issue constituted fundamental economic practices, and noting
that forming or manipulating economic relations may involve an abstract
idea); Content Extraction & Transmission LLC v. Wells Fargo Bank, Nat.
Ass 'n, 776 F.3d 1343, 1347 (Fed. Cir. 2014) (explaining that claims directed
to "the mere formation and manipulation of economic relations" and "the
performance of certain financial transactions" have been held to involve
abstract ideas).
Furthermore, it well settled that collecting information is within the
realm of abstract ideas---even when the information is limited to particular
content. Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d 1350, 1353 (Fed.
Cir. 2016). It is also well settled that analyzing information by steps people
go through in their minds, or by mathematical algorithms, without more, are
essentially mental processes within the abstract idea category. Id. at 1354.
And merely presenting the results of abstract processes of collecting and
analyzing information, without more (such as identifying a particular tool for
presentation), is abstract as an ancillary part of such collection and analysis.
Id.
Similar to the claims at issue in Electric Power, the claimed invention
here gathers, manipulates, analyzes, and presents information of a specified
content, but does not use any particular inventive technology for performing
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those functions. That the information pertains to a customer's finances and a
payment plan is of no consequence here, for collecting and analyzing
information such information does not make the collection and analysis non-
abstract. See SAP America, Inc. v. Investpic, LLC, 890 F .3d 1016, 1021
(Fed. Cir. 2018).
We, therefore, agree with the Examiner that the claimed invention is
directed to an abstract idea.
Alice Step Two
Nor do the recited elements---considered individually and as an
ordered combination-transform the nature of claim 1 into a patent-eligible
application of the abstract idea to ensure that the claim amounts to
significantly more than that idea. See Alice, 134 S. Ct. at 2357.
That the recited method includes a "web-form" and a computer
system does not change our conclusion. As the Examiner indicates, the
claimed invention merely uses generic computing components to perform
the recited abstract idea. Ans. 5, 13-14. See Mortgage Grader Inc. v. First
Choice Loan Services, Inc., 811F.3d1314, 1324--25 (noting that
components such an "interface," "network," and "database" are generic
computer components that do not satisfy the inventive concept requirement);
see also Intellectual Ventures I LLC v. Capital One Bank (USA), 792 F.3d
1363, 1370 (Fed. Cir. 2015) ("[T]he interactive interface limitation is a
generic computer element); buySAFE, 765 F.3d at 1355 ("That a computer
receives and sends the information over a network-with no further
specification-is not even arguably inventive.").
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Indeed, these generic computing components merely do that which
can be performed mentally or with a pen and paper---exclusive functions
ineligible for patent protection under § 101. See CyberSource Corp. v.
Retail Decisions, Inc., 654 F.3d 1366, 1372 (Fed. Cir. 2011). That the
Specification acknowledges in paragraph 48 that the recited calculations and
analysis can be performed by a human using only pencil and paper only
further bolsters the Examiner's findings and conclusions in this regard.
Accord Ans. 13 (noting this point).
Nevertheless, even if these the recited components add efficiency as
noted in the Specification's paragraph 48, 3 any speed increase comes from
the capabilities of the generic computer components-not the recited process
itself. See FairWarning IP, LLC v. Iatric Systems, Inc., 839 F.3d 1089, 1095
(Fed. Cir. 2016) (citing Bancorp Services, LLC v. Sun Life Assurance Co.,
687 F.3d 1266, 1278 (Fed. Cir. 2012) ("[T]he fact that the required
calculations could be performed more efficiently via a computer does not
materially alter the patent eligibility of the claimed subject matter.")). Like
the claims in Fair Warning, the focus of claim 1 is not on an improvement in
computer processors as tools, but on certain independently abstract ideas that
use generic computing components as tools. See FairWarning, 839 F.3d at
1095 (citations and quotation marks omitted).
In short, merely reciting these generic computing components cannot
transform a patent-ineligible abstract idea into a patent-eligible invention.
3 According to the Specification's paragraph 48, the claimed invention
reduces the time needed to perform the requisite calculations and analysis to
at least one quarter of the time required to perform those tasks "by hand,"
namely using pencil and paper.
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Id. at 2358. In other words, merely reciting an abstract idea while adding the
words "apply it with a computer" does not render an abstract idea non-
abstract: there must be more. See Alice, 134 S. Ct. at 2359. Nor does the
claimed invention improve the computer processor device's functionality or
efficiency, or otherwise change the way that device functions. Cf Enfzsh
LLC v. Microsoft Corp., 822 F.3d 1327, 1335 (Fed. Cir. 2016).
Appellant's reliance on McRO, Inc. v. Bandai Namco Games
America, Inc., 837 F.3d 1299 (Fed. Cir. 2016) (Reply Br. 1--4) is unavailing.
There, the claimed process used a combined order of specific rules that
rendered information in a specific format that was applied to create a
sequence of synchronized, animated characters. McRO, 837 F.3d at 1315.
Notably, the recited process automatically animated characters using
particular information and techniques-an improvement over manual three-
dimensional animation techniques that was not directed to an abstract idea.
Id. at 1316.
Unlike McRO, the claimed invention here creates a payment contract
by approving the customer based on certain customer-related factors, namely
(1) the line of willingness-to-pay, (2) a calculated value indicating the
customer's modified income, and (3) the customer's financial information.
Although these steps may be beneficial, a claim for a useful or beneficial
abstract idea is still an abstract idea. See Ariosa Diagnostics, Inc. v.
Sequenom, Inc., 788 F.3d 1371, 1379--80 (Fed. Cir. 2015).
That a web-form is used to collect a customer's financial information
and render the payment plan's terms for display is of no consequence here,
for these data gathering and display elements are merely insignificant extra-
solution activity that do not add significantly more to the abstract idea to
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render the claimed invention patent-eligible. See In re Bilski, 545 F.3d 943,
962 (Fed. Cir. 2008) (en bane), aff'd on other grounds, 561 U.S. 593 (2010)
("[T]he involvement of the machine or transformation in the claimed process
must not merely be insignificant extra-solution activity."); see also Bilski at
545 F.3d at 963 (characterizing data gathering steps as insignificant extra-
solution activity); Parker v. Flook, 437 U.S. 584, 590 (1978) (insignificant
post-solution activity found to be insufficient to impart patentability).
Accord Apple, Inc. v. Ameranth, Inc., 842 F.3d 1229, 1242 (2016) (same).
And, as noted previously, merely presenting the results of abstract processes
of collecting and analyzing information, without more (such as identifying a
particular tool for presentation), is abstract as an ancillary part of such
collection and analysis. Elec. Power 830 F.3d at 1354.
Lastly, we find unavailing Appellant's contention the Examiner also
failed to show that the claims preempt all ways of creating a contract for
payment. App. Br. 16. Where, as here, the claims cover a patent-ineligible
concept, preemption concerns "are fully addressed and made moot" by an
analysis under the Alice framework. See Ariosa Diagnostics, Inc. v.
Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir. 2015).
For the foregoing reasons, then, the recited elements---considered
both individually and as an ordered combination---do not contain an
"inventive concept" sufficient to transform the claimed abstract idea into a
patent-eligible application. Therefore, we are not persuaded that the
Examiner erred in rejecting claims 1-18 under § 101.
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THE OBVIOUSNESS REJECTION
The Examiner finds that Abrahams discloses many recited elements of
claim 1 including, among other things, calculating a line of willingness-to-
pay, and determining whether the customer is approved for the sale based on
the recited factors. Ans. 7-10. Although the Examiner acknowledges that
Abrahams' disclosed willingness to pay is a function of payment history, the
Examiner cites Shafik for teaching determining a consumer's willingness to
pay based on average capital income in concluding that the claim would
have been obvious. Ans. 9-10.
Appellant argues that not only does the Examiner fail to address the
claim language, the Examiner's reliance on Shafik is improper because it is
non-analogous art. App. Br. 16-21. Appellant adds that Abrahams'
willingness to pay is based solely on past payment history and, therefore,
does not teach or suggest calculating a line of willingness-to-pay based on a
returns report and sales on a given day as claimed. App. Br. 21-24.
ISSUES
(1) Under§ 103, has the Examiner erred in rejecting claim 1 by
finding that Abrahams and Shafik collectively would have taught or
suggested calculating a line of willingness-to-pay based on a returns report
and sales on a given day?
(2) Is the Examiner's proposed combination of the cited references
supported by articulated reasoning with some rational underpinning to
justify the Examiner's obviousness conclusion? This issue turns on whether
Shafik is analogous art.
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ANALYSIS
We begin by noting that the last two steps in claim 1 are performed if
the customer is approved and are, therefore, directed to conditional
limitations that need not be satisfied to meet the claim. See Ex parte
Schulhauser, No. 2013-007847, 2016 WL 6277792 (PTAB Apr. 28, 2016)
(precedential); see also MANUAL OF PATENT EXAMINING PROCEDURE
(MPEP) § 2111.04(II) (9th ed. Rev. 08.2017, Jan. 2018) (citing
Schulhauser). However, the broadest reasonable interpretation of an
apparatus claim with structure that performs a function, which only needs to
occur if a condition precedent is met, still requires structure for performing
the function should the condition occur. Schulhauser at 14--15. Therefore,
our interpretation of system claim 7 and medium claim 13 differs from
method claim 1 because the structure, namely the processor configured to
perform the recited functions, is present in the system regardless of whether
the condition is met and the function is actually performed.
Turning to the rejection, the key disputed aspect of claim 1 centers on
the recited line of willingness-to-pay calculation-a linear calculation based
on two factors: (1) a returns report, and (2) sales reported on a given day.
Our emphasis underscores that claim 1 recites explicitly that a line of
willingness to pay is calculated-not a value indicative of willingness to pay
as the Examiner finds. See Ans. 18.
This calculated line is described in connection with Appellant's
Figure 5 that graphs (1) the total percentage of sales that are returns, and (2)
the customer's willingness to pay over a 90-day period, where the two
associated lines 502, 504 are linear regressions calculated from data in
Figure 4. Spec. i-f 25. As shown in Figure 5, the percentage of returns
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increases during the sales period, thus indicating that a customer's desire to
continue to pay for a possessed item declines over time. Id. i-f 26. This
declining desire is shown in line 504 whose downward slope reflects the
customer's progressively-declining willingness to pay over time. Id. i-f 27.
Given the function of this linear willingness-to-pay calculation and
representation in the context of the disclosed invention, the Examiner's gloss
on this linear calculation is dubious on this record, including the two recited
factors on which this calculation is based. In the rejection, the Examiner
acknowledges that Abrahams' disclosed willingness to pay is a function of
payment history, but then finds that Abrahams' willingness to pay is
apparently not based on (1) a proposed sale price, and (2) a value indicating
the customer's modified income. See Ans. 9. The Examiner then cites
Shafik for teaching determining a consumer's willingness to pay based on
average capital income. Id.
But the recited willingness-to-pay line is not calculated based on these
factors, but rather (1) a returns report, and (2) sales reported on a given day.
To the extent that the Examiner concludes that Abrahams' using past
payment history to determine a customer's willingness to pay somehow
renders these two factors obvious either alone or in light of Shafik (see Ans.
9--10), we disagree.
Indeed, Shafik has nothing to do with creating payment contracts, let
alone creating those contracts by approving the customer based on certain
customer-related factors. Rather, Shafik is a high-level report analyzing
relationships between economic growth and environmental quality,
including environmental degradation such as pollution. See Shafik 757-58.
Although Shafik refers to the willingness to pay where survival is at stake
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and to avert damage on page 757, this willingness to pay has nothing to do
with approving a customer for a payment plan in connection with a sale as in
the present invention, let alone calculating a line of willingness-to-pay as
part of that approval process.
Prior art is analogous if it is ( 1) from the same field of endeavor
regardless of the problem addressed, or (2) reasonably pertinent to the
particular problem with which the inventor is involved. In re Bigio, 3 81
F.3d 1320, 1325 (Fed. Cir. 2004). Here, Shafik is not from Appellant's field
of endeavor, namely loan qualification, nor is Shafik reasonably pertinent to
Appellant's problem of determining whether a customer is approved for a
sale based on, among other things, a line of willingness-to-pay. Although
Shafik pertains to economics generally as the Examiner indicates (Ans. 17),
Shafik has nothing to do with Appellant's loan-based field of endeavor, nor
is the reference reasonably pertinent to Appellant's problem of approving
customers for sales. Shafik is, therefore, non-analogous art and, as such, the
Examiner's obviousness rejection is deficient for this additional reason.
Therefore, we are persuaded that the Examiner erred in rejecting (1)
independent claim 1; (2) independent claims 7 and 13 that recite
commensurate limitations; and (3) the dependent claims for similar reasons.
Because this issue is dispositive regarding our reversing the Examiner's
rejection of these claims, we need not address Appellant's other associated
arguments.
CONCLUSION
The Examiner did not err in rejecting claims 1-18 under§ 101, but
erred in rejecting those claims under§ 103.
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DECISION
We affirm the Examiner's decision to reject claims 1-18. Because the
rejection of each appealed claim is affirmed on at least one of the grounds
specified in the Office Action from which the appeal was taken, the
Examiner's decision to reject claims 1-18 is affirmed. See 37 C.F.R.
§ 41.50(a)(l).
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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