Ex Parte Lutnick et al

Patent Trial and Appeal Board

Apr 28, 2017

12399570 (P.T.A.B. Apr. 28, 2017)

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.
12/399,570 03/06/2009 Howard W. Lutnick 09-2306 2303
63710 7590 05/02/2017
INNOVATION DIVISION
CANTOR FITZGERALD, L.P.
110 EAST 59TH STREET (6TH FLOOR)
NEW YORK, NY 10022
EXAMINER
ABDI, KAMBIZ
ART UNIT PAPER NUMBER
3694
NOTIFICATION DATE DELIVERY MODE
05/02/2017 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
lkoro vich @ c antor. com
phowe @ cantor.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte HOWARD W. LUTNICK, BIJOY PAUL,
and MICHAEL SWEETING1
Appeal 2015-003909
Application 12/399,570
Technology Center 3600
Before HUBERT C. LORIN, BIBHU R. MOHANTY, and
BRADLEY B. BAYAT, Administrative Patent Judges.
BAYAT, Administrative Patent Judge.
DECISION ON REQUEST FOR REHEARING
Appellants filed a Request for Rehearing (“Request”) under 37 C.F.R.
§ 41.52 for reconsideration of our Decision on Appeal mailed February 2,
2017. The Decision affirmed the Examiner’s § 101 rejection of claims 1—5,
7—14, 16—22, and 24—39; reversed the Examiner’s § 112, second paragraph,
rejection of claim 36; affirmed the Examiner’s § 103 rejection of claims 1,
7—9, 16—18, 24—26, 29—31, and 38 and reversed the Examiner’s § 103
rejection of claims 2—5, 10-14, 19-22, 27, 28, 32—37, and 39 on appeal. We
have jurisdiction over the Request under 35 U.S.C. § 6(b).
1 Appellants identify “CFPH, L.P.” as the real party in interest (Appeal Br.
4).
Appeal 2015-003909
Application 12/399,570
ANALYSIS
We note at the outset that a Request for Rehearing “must state with
particularity the points believed to have been misapprehended or overlooked
by the Board.” 37 C.F.R. § 41.52(a). A Request for Rehearing is not an
opportunity to rehash arguments raised in the Briefs. Neither is it an
opportunity to merely express disagreement with a decision without setting
forth points believed to have been misapprehended or overlooked.
Arguments not raised in the briefs before the Board and evidence not
previously relied on in the briefs also are not permitted except in the limited
circumstances set forth in §§ 41.52 (a)(2) though (a)(4). Id.
To the extent Appellants present supplemental or new arguments in
the Request, those arguments are untimely and, as such, will not be
considered except where the arguments are based on a recent relevant
decision of either this Board or a federal court, or on an allegation that the
Board’s decision contains an undesignated new ground of rejection. See id.
Non-statutory Subject Matter
Independent claims 1, 9, and 18
Regarding the rejection under 35U.S.C. § 101, Appellants’ first and
third arguments allege that the Office failed to establish a prima facie case
under step one and step two, respectively, of the Alice framework. Req.
Reh’g 2—3; 5—6. In this regard, Appellants contend that there is no
“evidence presented regarding the fimdamentality or long prevalence of the
allegedly abstract idea.” Id. at 3.
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We are not aware of any controlling precedent that imposes such a
requirement, and Appellants have not identified any such precedent. As we
indicated in our Decision, the Examiner properly complied with the Office’s
Interim Guidance on Subject Matter Eligibility at the time of mailing of the
Answer. Dec. 4—5. The Examiner set forth the statutory basis of the
rejection, applied Alice’s two-part framework, and sufficiently articulated
reasoning in an informative manner, thus, meeting the notice requirement of
35U.S.C. § 132. Appellants do not maintain that they did not understand
the Examiner’s rejection. Therefore, the Examiner established a prima facie
case of unpatentability. The burden then shifted to Appellants to rebut the
Examiner’s prima facie case.
Appellants’ second and fourth arguments, respectively, contend that
the claims pass muster under steps one and two of Alice. Id. at 3—5; 6—11.
Appellants argue that “there is no risk that the claims would preempt all
trading using engines.” Id. at 5. According to Appellants, the invention is
“directed to an improvement in computer-related technology that increases
the speed and reduces delays found in conventional trading systems.” Id. at
3. Appellants contend that the claims are directed to improvements in
technology like the claims in DDR, Enfish, Bascom, McRO, Amdocs, and
Trading Techs. Id. at 2—11. Appellants argue in particular that the claims
fall under the ruling in Trading Techs. Int’l, Inc. v. CQG, INC., No. 20lb-
1616, 2017 WL 192716 (Fed. Cir. Jan. 18, 2017). Id. at 2-3; 7-11.
We disagree.
In Trading Techs., the Federal Circuit affirmed the district court’s
holding that the claims were not directed to an abstract idea because the
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claims required “a specific, structured graphical user interface paired with a
prescribed functionality directly related to the graphical user interface’s
structure that is addressed to and resolves a specifically identified problem in
the prior state of the art.” Trading Techs, at *3. Here, the claims do not
recite a graphical user interface, and thus are readily distinguishable from
the claims in Trading Techs.
We find the claims on appeal to be more similar to the claims held
ineligible in Accenture Global Services, GmbH v. Guidewire Software, Inc.,
728 F.3d 1336 (Fed. Cir. 2013).
Each of the independent claims requires an event engine, a matching
engine, and a bus that couples the two. More specifically, claims 9 and 18
recite “a data bus of the exchange that couples the event engine and the
matching engine,” and claim 1 recites “the data bus is configured to allow
communication of the indication to add the order from the event engine to
the matching engine.” Claims 9 and 18 require transmitting an indication of
an order through the data bus from the event engine to the matching engine.
Our reviewing court addressed similar claim limitations in Accenture
and found them ineligible under Alice. In Accenture, the claims recited,
inter alia, a “server component including an event processor, a task engine
and a task assistant” and “wherein the event processor is triggered by
application events associated with a change in the information, and sends an
event trigger to the task engine.” Accenture presented arguments that the
claims were directed to a narrow “combination of computer components
including an insurance transaction database, a task library database, a client
component, and a server component, which includes an event processor, a
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task engine, and a task assistant” and that “the complexity and detail of the
specification demonstrate that the patent is an advance in computer software
and not simply a claim to an abstract idea.” Accenture, 728 F.3d at 1344.
The court rejected Accenture’s first argument because “simply
implementing an abstract concept on a computer, without meaningful
limitations to that concept, does not transform a patent-ineligible claim into
a patent-eligible one.” Id. at 1345 (citing Bancorp Servs., LLC v. Sun Life
Assurance Co. of Can., 687 F.3d 1266, 1280 (Fed. Cir. 2012)). Regarding
preemption, the court held that “Accenture’s attempts to limit the abstract
concept to a computer implementation and to a specific industry thus do not
provide additional substantive limitations to avoid preempting the abstract
idea . . .” Id. The court also stated “[Regarding Accenture’s argument
concerning the complexity of the specification, including the specification’s
detailed software implementation guidelines, the important inquiry for a
§ 101 analysis is to look to the claim.” Id.
We find the claimed “event engine” and “matching engine” to be
analogous to the claimed “event processor” and “task engine,” respectively,
in Accenture. Here, notwithstanding that detailed software implementations
may be disclosed in certain embodiments of Appellants’ Specification, the
claims merely add conventional computer components to well-known
business practices. Appellants’ argument that there is no risk of preemption
is undermined by the breadth of the claims, which describe the claim
elements purely in functional terms. For example, in light of the
Specification, the claimed “bus” encompasses any network or component
that allows communication between an event engine and a matching engine.
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See, e.g., Spec., para. 118 (“In some embodiments, communication network
215 may include a data bus. The data bus may allow communication from
the event engine to the matching engine.”); Id. at para. 119 (“a data bus may
include a communication network that is used to transport information
among/between/to/from component(s) of a machine”).
We note the point about pre-emption. Req. Reh’g 5 (“no risk that the
claims would preempt all trading using engines”). However, while pre­
emption “might tend to impede innovation more than it would tend to
promote it, ‘thereby thwarting the primary object of the patent laws’” {Alice,
134 S. Ct. at 2354 (citing Mayo at 1293)), “the absence of complete
preemption does not demonstrate patent eligibility” (Ariosa Diagnostics,
Inc. v. Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir. 2015)). While the
specific claim limitations may prevent pre-emption of all trading using
engines, that does not make the claimed subject matter any less directed to
an abstract idea. See OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359,
1362—63 (Fed. Cir. 2015), cert, denied, OIP Techs., Inc., 136 S. Ct. 701, 193
(2015) (“[Tjhat 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.”). Moreover, because we determine the claimed subject
matter covers patent-ineligible subject matter, the pre-emption concern is
necessarily addressed. “Where a patent’s claims are deemed only to disclose
patent ineligible subject matter under the Mayo framework, [] preemption
concerns are fully addressed and made moot.” Ariosa Diagnostics, 788 F.3d
at 1379.
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We also note the discussion of delay in the Specification. See, e.g., id.
at para. 92 (“[djelay may result in suboptimal trading results”). While some
techniques for reducing delay in a system may constitute technological
improvements, that is not necessarily true in every case. See OIP Techs.,
Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1363 (Fed. Cir.), cert, denied, 136
S. Ct. 701, 193 L. Ed. 2d 522 (2015) (“relying on a computer to perform
routine tasks more quickly or more accurately is insufficient to render a
claim patent eligible”). Here, providing a bus (e.g., network) that transports
information between two components of a computer is not even arguably
inventive. Cf. BuySAFE v. Google, Inc., 765 F.3d 1350, 1355 (Fed. Cir.
2014) (“That a computer receives and sends the information over a
network—with no further specification—is not even arguably inventive.”).
In fact, transporting information between components of a computer is—by
definition—the function of any bus. For example, Webster’s New World
Computer Dictionary defines “bus” as “[a]n internal electrical pathway
along which signals are sent from one part of the computer to another”2 and
defines “data bus” as “[a]n internal electronic pathway that enables the
microprocessor to exchange data with random access memory (RAM).”3 Cf.
Alice, 134 S. Ct. at 2360 (“Nearly every computer will include a
‘communications controller’ and a ‘data storage unit’ capable of performing
2 Webster’s New World Computer Dictionary (2003) retrieved from
http://search.credoreference.eom/content/entry/webstercom/bus/0 (Accessed
Apr. 26, 2017)
3 Webster’s New World Computer Dictionary (2003) retrieved from
http:// search, credoreference. com/ content/entry/webstercom/ data_bus/0
(Accessed Apr. 26, 2017)
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the basic calculation, storage, and transmission functions required by the
method claims.”); see also Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d
1350, 1355 (Fed. Cir. 2016) (“Nothing in the claims, understood in light of
the specification, requires anything other than off-the-shelf, conventional
computer, network and display technology for gathering, sending, and
presenting the desired information”). In other words, the claimed bus
operates precisely in its normal, expected manner to transport information.
Cf. DDR Holdings, LLCv. Hotels.com, L.P., 773 F.3d 1245, 1258-59
(Fed.Cir.2014) (finding a computer-implemented method patent eligible
where the claims recite 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”). Accordingly, we find the claimed
arrangement of a bus that couples an event engine and a matching engine to
be insufficient to root the claimed invention in technology.
Finally, we disagree with Appellants’ argument that our “position
would make all claims that touched economics or trading directed to an
abstract idea.” Req. Reh’g 2. Our Decision makes no such sweeping
holding. Moreover, nothing in our Decision contradicts the Federal Circuit’s
statement in Enfish that “[sjoftware can make non-abstract improvements to
computer technology just as hardware improvements can.” Enfish, LLC v.
Microsoft Corp., 822 F.3d 1327, 1335 (Fed. Cir. 2016). Rather, as discussed
above, our Decision is based on the particular facts and evidence of record
before us in the instant case.
For the forgoing reasons, we deny Appellants’ request as to
independent claims 1, 9, and 18.
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Dependent claims
Appellants present separate arguments for the patentability of various
dependent claims for the first time in the Request. Req. Reh’g 11—13.
The Board regulation governing requests for rehearing provides in
relevant part:
The request for rehearing must state with particularity the points
believed to have been misapprehended or overlooked by the
Board. Arguments not raised, and Evidence not previously relied
upon, pursuant to §§ 41.37, 41.41, or 41.47 are not permitted in
the request for rehearing except as permitted by paragraphs (a)(2)
through (a)(4) of this section.
37 C.F.R. § 41.52(a)(2014). Paragraph (a)(2) provides that upon showing of
good cause, a new argument may be presented based on a recent relevant
decision of either the Board or a Federal Court. Paragraph (a)(3) provides
that new arguments may be presented responding to a new ground of
rejection made pursuant to § 41.50(b). Paragraph (a)(4) provides that new
arguments may be presented responding to the Board’s decision containing
an undesignated new ground of rejection.
Appellants have not directed our attention to arguments in its principal
briefs on appeal with regards to any of the dependent claims. Indeed, none
of the dependent claims were mentioned at all. See Reply Br. filed February
4, 2015 at 10-11. Thus, we cannot have misapprehended or overlooked
these arguments. Moreover, we did not enter a new ground of rejection, nor
have Appellants requested that we denominate our affirmance as a new
ground. We note that the Federal Circuit’s decision in DDR was issued two
months prior to the filing of Appellants’ Reply Brief. Appellants have
provided no explanation as to why the dependent claims could not have been
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separately argued prior to the Request. Accordingly, neither basis for raising
a new argument has been satisfied, and we therefore deny the request for
relief on that basis as to the dependent claims.
Thus, we conclude that Appellants have failed to show that the Board
misapprehended or overlooked points raised in the appeal or that the
Decision to affirm the Examiner was erroneous.
Obviousness
Appellants first argue that the Decision applied an unreasonable claim
construction. Req. Reh’g 14. According to Appellants, the claimed event
engine and matching engine “are not software elements” and “are physical
hardware components.” Id. Appellants cite paragraphs 95, 108, and 118 and
Figure 2 of the Specification as evidence that “the matching and event
engines are separate processors.” Id.
Appellants’ argument is not commensurate with the scope of the
claims, which do not recite “separate processors.”
[T]he PTO applies to the verbiage of the proposed claims the
broadest reasonable meaning of the words in their ordinary usage
as they would be understood by one of ordinary skill in the art,
taking into account whatever enlightenment by way of
definitions or otherwise that may be afforded by the written
description contained in applicant’s [Specification.
In re Morris, 127 F.3d 1048, 1054 (Fed. Cir. 1997). To read a claim in light
of the Specification, one must interpret limitations explicitly recited in the
claim, without reading limitations from the Specification into the claim, to
thereby narrow the scope of the claim by implicitly adding disclosed
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limitations that are not recited in the claim. In re Prater, 415 F.2d 1393,
1404—05 (CCPA 1969).
Nothing in Appellants’ Specification indicates that Appellants have
acted as their own lexicographer by providing an express definition for the
term “engine.” The broadest reasonable meaning of the term “engine” in its
ordinary usage as it would be understood by one of ordinary skill in the art
includes software engines. For example, Webster’s New World Computer
Dictionary (2003) defines “search engine” as “[a]ny program that locates
needed information in a database.”4 As we noted in the Decision, the
Specification describes the claimed engines by way of example. See, e.g.,
Spec., para. 95 (“a matching engine may include one or more processors”)
(emphasis added); para. 108 (“event engine may include a machine
component (e.g., a processor)”) (emphasis added). We further note that the
Specification specifically discloses implementations using only software.
See id. at para. 58 (“various combinations of hardware and software may be
used instead of software only.”); see also Prolitec, Inc. v. Scentair Techs.,
Inc., 807 F.3d 1353, 1358 (Fed. Cir. 2015) (noting that “the use of‘may’
signifies that the inventors did not intend to limit [the claims to a particular
feature]”). Thus, it is clear from the Specification that the inclusion of
hardware in either the event engine or matching engine is optional.
Appellants’ second argument is that claim 4 “is an explicit claim to an
arrangement of processors and a bus that allows a specialized type of access
4 Webster’s New World Computer Dictionary (2003) retrieved from
http:// search, credoreference. com/ content/entry/webstercom/ search_engine/0
(Accessed Apr. 24, 2017)
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between the processors” and “claim 4 is in fact evidence that the claimed
engines are hardware components.” Req. Reh’g 16.
But Appellants’ argument is not commensurate with the scope of the
claims, which do not recite “processors” or “hardware components.” Claim
4 does not contain any limitations directed to the “event engine” of claim 1.
The recitation in claim 4 that the matching engine reads instructions from “a
local memory location” is not evidence that the matching engine itself must
be a hardware component. The Specification does not describe “a local
memory location of the matching engine.” For example, paragraph 100 of
Appellants’ Specification discloses that “a matching engine may receive an
indication of an order . . . through a bus, through another communication
network, from a remote system, from an event engine, and so on.” See also,
Spec., para. 98 (“a queue may include memory (e.g., RAM, registers, solid
state memory, hard disk drives, etc.).” In light of the Specification, the
“local memory location” of claim 4 encompasses a location in local system
memory (e.g., system RAM of a local computer system) assigned to a
software-implemented matching engine (e.g., a software matching engine
executed by a processor that reads instructions from system RAM via a data
bus).
Appellants’ third argument is that the Decision “misinterprets the
[Specification to allege that the claims are directed to a general purpose
computer with two software programs running.” Req. Reh’g 17. According
to Appellants, “the structure includes two physical processor elements: one
matching engine and one event engine.” Id.
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We disagree. As we have already explained above, Appellants’
argument is not commensurate with the scope of the claim, which does not
recite “physical processor elements.” Appellants have not pointed to any
disclosure in the Specification that limits the claimed engines to “physical
processor elements.” The burden of precise claim drafting falls squarely on
the applicant. See In re Morris, 127 F.3d at 1056.
Appellants’ fourth argument is that the Decision improperly relied on
“an off exchange trading widget or GUI to be a teaching or suggestion of an
engine of the exchange.” Req. Reh’g 18. Appellants cite paragraph 116 of
the Specification as teaching “that the machine and event engine are
physically together on the exchange.” Id. Appellants also argue that the
Decision is internally inconsistent. Id.
Contrary to Appellants’ characterization, Mather does not disclose “an
off exchange trading widget.” Rather, Mather discloses at paragraph 17 “a
financial trading system comprising ... a trading widget module.”
Appellants’ assertion that the trading widget module of Mather is “off
exchange” is premised on Appellants’ claim interpretation that seeks to
import limitations from the Specification, particularly the exemplary
structure of Figure 2. Req. Reh’g 15. As we have already explained above,
limitations from the Specification are not imported into the claims. As we
noted in the Decision, Appellants’ Specification does not contain a definition
for “exchange.” Dec. 11. The Specification describes the claimed
“exchange” broadly by way of example. See Spec. para. 123 (“the exchange
of figure 2 is given as an example only”); id. at para. 81 (“exchange 101 may
include one or more computer systems and/or computer components
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configured to provide trading services to the participants 103.”); id. at para.
77 (“these components are given as examples only and . . . various
embodiments may include any number of additional and/or alternative
components. . . . [A]ny other components that provide additional desired
functionality may be included”);5 see also, id. at para. 66 (“the present
invention may, in an embodiment, be practiced on one or more devices
without a central authority.”). In light of this disclosure, Appellants have not
persuasively explained, how the financial trading system disclosed in
Mather—and more specifically the trading widget module of the financial
trading system—does not meet the claimed “event engine, of the financial
exchange.”
We do not see any inconsistency in our Decision. On the contrary,
our finding that the claimed “event engine” reads on the trading application
disclosed in Mather is entirely consistent with our finding that the claimed
“event engine” encompasses a software engine.
For the foregoing reasons, we are not persuaded that the Decision
applied an unreasonable claim interpretation.
DECISION
To summarize, our decision is as follows:
We have considered the REQUEST FOR REHEARING.
We deny the request that we reverse the Examiner’s rejection under § 101
and § 103 as to claims sustained in our Decision.
DENIED
5 We note that the Specification contains two paragraphs labeled “[0077]”;
the above citation is to paragraph 77 on page 19 of the Specification.
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