Ex Parte Mihic et al

Patent Trial and Appeal Board

Oct 31, 2017

13332721 (P.T.A.B. Oct. 31, 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.
13/332,721 12/21/2011 Kresimir MIHIC T9049-19680US01 5036
74739 7590 11/02/2017
MILES & STOCKBRIDGE P.C.
Oracle International Corporation
1751 Pinnacle Drive
EXAMINER
MARCUS, LELAND R
Suite 1500
Tysons Corner, VA 22102-3833
ART UNIT PAPER NUMBER
3623
NOTIFICATION DATE DELIVERY MODE
11/02/2017 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):
Ipdocketing @ Miles S tockbridge. com
bgoldsmith @ miles stockbridge .com
smcvean @ milesstockbridge. com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte KRESIMIR MIHIC, DAVID VENGEROV, and
ANDREW VAKHUTINSKY
Appeal 2016-005917
Application 13/332,721
Technology Center 3600
Before JAMES R. HUGHES, ERIC S. FRAHM, and
NORMAN H. BEAMER, Administrative Patent Judges.
HUGHES, Administrative Patent Judge.
DECISION ON APPEAL
STATEMENT OF THE CASE
Appellants1 seek our review under 35 U.S.C. § 134(a) of the
Examiner’s final decision rejecting claims 1, 3—8, 10-15, and 17—21.
Claims 2, 9, and 16 have been canceled. Final Act. 1—2.2 We have
jurisdiction under 35 U.S.C. § 6(b).
1 The real party in interest is Oracle International Corporation. App. Br. 2.
2 We refer to Appellants’ Specification (“Spec.”) filed Dec. 21, 2011;
Appeal Brief (“App. Br.”) filed Sept. 24, 2015; and Reply Brief (“Reply
Br.”) filed May 16, 2016. We also refer to the Examiner’s Answer (“Ans.”)
mailed Mar. 17, 2016, and Final Office Action (Final Rejection) (“Final
Act.”) mailed Apr. 9, 2015.
Appeal 2016-005917
Application 13/332,721
We affirm.
Appellants ’ Invention
The invention generally relates to computer-readable media, price
optimization systems, and methods for determining a pricing of items. The
method includes receiving an initial price for a group of items (a set of
prices or “price vector”), receiving an objective function comprising the
revenue or margin for each item, and determining a new price vector by
randomly choosing a set of allowed prices for the items which improves the
objective function (exploiting the existing price vector) and assigning the
allowed prices as the current price vector. The method also includes
determining a second new price vector by randomly choosing a second set of
allowed prices for the items that does not decrease the objective function by
more than a predetermined value (exploring the current price vector),
assigning the second set of allowed prices as the current price vector,
sequentially repeating the exploiting and exploring until a terminating
criteria is reached. Spec. Tflf 1, 4, 8, 9, 13; Abstract.
Representative Claim
Independent claim 1, reproduced below, further illustrates the
invention:
1. A non-transitory computer readable medium having
instructions stored thereon that, when executed by a processor,
cause the processor to determine pricing of a plurality of items,
the pricing determination comprising:
receiving an initial price vector for the items and assigning
the initial price vector as a current price vector, wherein the
initial price vector comprises a set of prices for each of the items;
receiving an objective function, wherein the objective
function comprises at least revenue or margin;
2
Appeal 2016-005917
Application 13/332,721
determining a first new price vector by exploiting the
current price vector, wherein the exploiting comprises randomly
choosing a first set of allowed prices for the items, and when the
first set of allowed prices improves the objective function,
assigning the first set of allowed prices as the current price
vector, wherein when the objective function is revenue or
margin, an increase in objective function improves the objective
function;
determining a second new price vector by exploring the
current price vector after the determining the first new price
vector, wherein the exploring comprises randomly choosing a
second set of allowed prices for the items, and when the second
set of allowed prices does not decrease the objective function by
more than a predetermined value, assigning the second set of
allowed prices as the current price vector; and
sequentially repeating the exploiting and exploring until a
terminating criteria is reached, wherein when the terminating
criteria is reached, the current price vector is the determined
pricing of the plurality of items;
wherein the exploiting further comprises, for a set of
allowed prices for an item i, finding a price p that maximizes a
value of the objective function, forming a new price vector by
setting the price of item i to p, repeating the finding the price p
for additional items i, and determining if the number of items
with prices that differ from original values is greater than a
predetermined maximum.
Rejections on Appeal
1. The Examiner rejects claims 1, 3—8, 10-15, and 17—21 under 35
U.S.C. § 101 as being directed to patent ineligible subject matter.
2. The Examiner rejects claims 1, 3—8, 10-15, and 17—21 under 35
U.S.C. § 103(a) as being unpatentable over Orcun Molvalioglu et al., The
interacting-particle algorithm with dynamic heating and cooling, J. Glob.
Optim., 43:329-356 (2009) (“Molvalioglu”) and Boyd et al. (US
2005/0256778 Al, published Nov. 17, 2005) (“Boyd”).
3
Appeal 2016-005917
Application 13/332,721
ISSUES
Based upon our review of the record, Appellants’ contentions, and the
Examiner’s findings and conclusions, the issues before us follow:
1. Did the Examiner err in rejecting claims 1, 3—8, 10—15, and 17—
21 under 35 U.S.C. § 101 as being directed to patent ineligible subject
matter?
2. Did the Examiner err in finding that Molvalioglu and Boyd
collectively would have taught or suggested “sequentially repeating the
exploiting and exploring until a terminating criteria is reached, wherein
when the terminating criteria is reached, the current price vector is the
determined pricing of the plurality of items” wherein “the exploring
comprises randomly choosing a second set of allowed prices for the items”
that “does not decrease the objective function by more than a predetermined
value” and wherein
the exploiting . . . comprises, for a set of allowed prices for an
item i, finding a price p that maximizes a value of the objective
function, forming a new price vector by setting the price of item
i top, repeating the finding the pricep for additional items i, and
determining if the number of items with prices that differ from
original values is greater than a predetermined maximum
(claim 1) within the meaning of Appellants’ claim 1 and the commensurate
limitations of Appellants’ claims 8 and 15?
ANALYSIS
The 35 U.S.C. § 101 Rejection
Appellants argue independent claims 1, 8 and 15 together as a group
with respect to the § 101 rejection. See App. Br. 3—9. We select
4
Appeal 2016-005917
Application 13/332,721
independent claim 1 as representative of Appellants’ arguments with respect
to claims 1, 3—8, 10—15, and 17—21. 37 C.F.R. § 41.37(c)(l)(iv).
The Examiner rejects the claims as being directed to patent ineligible
subject matter in that “the claims are directed to the abstract idea of. . . price
optimization using randomized search” and the claims “do not include
additional elements that are sufficient to amount to significantly more than
the judicial exception because they recite only the use of a generic computer
performing generic computing tasks” (Final Act. 2). See Ans. 2—6.
Appellants contend that claims are not directed to an abstract idea because
“a comparison of the alleged abstract idea of ‘computer modeling and data
analysis, specifically price optimization using randomized search’ to the
abstract ideas identified by the courts shows that there are no similarities”
(App. Br. 4). See App. Br. 3^4; Reply Br. 2—3. Appellants further contend
that “the claims can include an ‘inventive concept’ or additional elements so
that the abstract idea is transformed into a patent-eligible application” (App.
Br. 5). See App. Br. 5—9; Reply Br. 4.
Under 35 U.S.C. § 101, a patent may be obtained for “any new and
useful process, machine, manufacture, or composition of matter, or any new
and useful improvement thereof.” The Supreme Court has “Tong held that
this provision contains an important implicit exception: Laws of nature,
natural phenomena, and abstract ideas are not patentable.’” Alice Corp. Pty.
Ltd. v. CLS Bank Inti, 134 S. Ct. 2347, 2354 (2014) (quoting Assn for
Molecular Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107, 2116
(2013)).
The Supreme Court, in Alice, reiterated the two-step framework
previously set forth in Mayo Collaborative Services v. Prometheus
5
Appeal 2016-005917
Application 13/332,721
Laboratories, Inc., 566 U.S. 66, 77—80 (2012), “for distinguishing patents
that claim laws of nature, natural phenomena, and abstract ideas from those
that claim patent-eligible applications of those concepts.” Alice, 134 S. Ct.
at 2355. The first step in that analysis is to “determine whether the claims at
issue are directed to one of those patent-ineligible concepts” (id.), e.g., to an
abstract idea. If the claims are not directed to an abstract idea, the inquiry
ends. Otherwise, the inquiry proceeds to the second step where the elements
of the claims are considered “individually and ‘as an ordered combination’
to determine whether the additional elements ‘transform the nature of the
claim’ into a patent-eligible application.” Alice, 134 S. Ct. at 2355 (quoting
566 U.S. at 78, 79).
The Court acknowledged 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 itself is the
abstract idea and merely invoke generic processes and machinery. See
Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1336 (Fed. Cir. 2016).
Turning to the first step of the eligibility analysis, the Examiner finds
claim 1 is directed to the abstract idea of optimizing the price of items using
a randomized search. See Final Act. 2. The Examiner further explains that
the claims are similar to claims previously found to be directed to abstract
ideas. See Ans. 2-4. Conversely, the Appellants simply attack the
Examiner’s findings, alleging the Examiner has not properly mapped the
abstract concept to specific precedent, without actually addressing any of the
Examiner’s findings. See App. Br. 3^4; Reply Br. 2—3. We agree with the
6
Appeal 2016-005917
Application 13/332,721
Examiner that Appellants’ claim 1 (and the other pending claims) are
directed to a patent-ineligible abstract idea.
Instead of using a fixed definition of an abstract idea and analyzing
how claims fit (or do not fit) within the definition, “the decisional
mechanism courts now apply is to examine earlier cases in which a similar
or parallel descriptive nature can be seen — what prior cases were about,
and which way they were decided.” Amdocs (Isr.) Ltd. v. Openet Telecom,
Inc., 841 F.3d 1288 (Fed. Cir. 2016) (citing Elec. Power Grp., LLC v.
Alstom S.A., 830 F.3d 1350, 1353—54 (Fed. Cir. 2016). As part of this
inquiry, we must “look at the ‘focus of the claimed advance over the prior
art’ to determine if the claim’s ‘character as a whole’ is directed to excluded
subject matter.” Affinity Labs, of Texas, LLC v. DIRECTV, LLC, 838 F.3d
1253, 1257 (Fed. Cir. 2016).
Here, Appellants’ claims generally, and independent claims 1, 8, and
15 in particular, relate to determining optimized pricing utilizing sequential
randomized searching (randomized search phases — exploiting and
exploring). See Spec. 1 8. This is consistent with how Appellants describe
the claimed invention. See Spec. ]Hf 8, 13. Contrary to Appellants’
assertions the present claims are analogous to a number of cases in which
courts have identified similar claims as encompassing abstract ideas (see
App. Br. 4; Reply Br. 2) and delineating this underlying abstract concept
does not “generaliz[e] the alleged abstract idea at such a high level (i.e.,
‘computer modeling and data analysis’) that it no longer has ANY
relationship to the recited limitations” (Reply Br. 2).
Our reviewing court has held that abstract ideas include price
optimization. See OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359
7
Appeal 2016-005917
Application 13/332,721
(Fed. Cir. 2015) (finding claims directed to price optimization on a generic
computer to be an abstract idea). Additionally, our reviewing court has held
that the collection, analysis, and manipulation of information (data) (e.g.,
recognizing certain data within the dataset) are also abstract ideas. See Elec.
Power, 830 F.3d at 1354; see also Content Extraction & Transmission LLC
v. Wells Fargo Bank, N.A., 776 F.3d 1343, 1347 (Fed. Cir. 2014).
Here, the determination of optimized pricing for items is similar to the
abstract idea of price optimization (OIP Techs.) and collecting, analyzing,
and manipulating information (i.e., prices) and comparing values (i.e., a
mathematical function) to predetermined values (as discussed in Elec.
Power). Thus, we agree with the Examiner that the claims are directed to an
abstract idea of determining optimized pricing utilizing sequential
randomized searching. Notably, this characterization is consistent with
Appellants’ description of the claimed invention. See Spec. 8, 13.
Having found Appellants’ claims are directed to an abstract concept
under Alice’s step 1 analysis, we next address whether the claims add
significantly more to the alleged abstract idea. As directed by our reviewing
Court, we search for an ‘“inventive concept’ sufficient to ‘transform the
nature of the claim into a patent-eligible application.’” McRO, Inc. v.
Bandai Namco Games Am. Inc., 837 F.3d 1299, 1312 (Fed. Cir. 2016)
(quoting Alice, 134 S. Ct. at 2355). The implementation of the abstract idea
involved must be “more than performance of ‘well-understood, routine,
[and] conventional activities previously known to the industry.’” Content
Extraction & Transmission LLC v. Wells Fargo Bank, N.A., 776 F.3d 1343,
1347-48 (Fed. Cir. 2014).
8
Appeal 2016-005917
Application 13/332,721
Here, the Examiner found that Appellants’ claims do not add
significantly more. See Final Act. 2; Ans. 4—6. Appellants, on the other
hand, contend the claims “include an ‘inventive concept’ or additional
elements so that the abstract idea is transformed into a patent-eligible
application” (App. Br. 5; see App. Br. 5—9; Reply Br. 4) because (1) “the
present claims recite functionality that goes well beyond the mere concepts
of simply retrieving, comparing and combining data using a computer”
(App. Br. 6; see App. Br. 5—6); (2) the claims “do not attempt to preempt
every application of the alleged abstract idea of ‘computer modeling and
data analysis, specifically price optimization using randomized search’”
(App. Br. 7; see App. Br. 6—7); and (3) “the recited claims provide
improvements to the functioning of the computer” similar to the claims in
DDR Holdings (App. Br. 8; see App. Br. 7—8).
With respect to Appellants’ preemption arguments, “[wjhile
preemption may signal patent ineligible subject matter, the absence of
complete preemption does not demonstrate patent eligibility.” FairWarning
IP, LLC v. Iatric Sys., Inc., 839 F.3d 1089, 1098 (Fed. Cir. 2016) (quoting
Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir.
2015)); see also OIP Techs., 788 F.3d at 1362—63 (“[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.”). Further,
“[wjhere a patent’s claims are deemed only to disclose patent ineligible
subject matter under the Mayo framework, as they are in this case,
preemption concerns are fully addressed and made moot.” Ariosa, 788 F.3d
at 1379.
9
Appeal 2016-005917
Application 13/332,721
With respect to Appellants’ DDR Holdings arguments, Appellants
misconstrue DDR Holdings. In DDR Holdings, the court held that a claim
may amount to more than any abstract idea recited in the claims when it
addresses and solves problems only encountered with computer technology
and online transactions, e.g., by providing (serving) a composite web page
rather than adhering to the routine, conventional functioning of Internet
hyperlink protocol. See DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d
1245, 1257—59 (Fed. Cir. 2014). In contrast, claim 1 performs a process that
collects, analyzes, and manipulates information (prices) to determine
optimized pricing (an optimized pricing vector) (data structure) utilizing a
conventional computer. See Final Ans. 2-4; Spec. H 1, 4, 8, 9, 13, 25, 26,
33, 45, 46, 51, 52; cf. App. Br. 5—8; Reply Br. 4. The collection (searching),
analysis, and manipulation of prices (data) are not technical problems as
discussed in DDR, they are pricing and/or efficiency problems (whether
random searching of prices meets certain criteria). Determining optimized
pricing is a commercial solution to the pricing/efficiency problem, not a
technical solution. This commercial solution may be assisted using a
general purpose computer to perform the data collection, analysis, and
manipulation processes, but does not arise specifically in the realm of
computer networking or improve how the computer itself functions. As we
previously explained, the instant claims are more akin to the claims for
analyzing information found to be abstract in OIP Techs., 788 F.3d at 1363
or Elec. Power, 830 F.3d at 1353.
We agree with the Examiner that the additional limitations, separately,
or as an ordered combination, do not provide meaningful limitations (i.e., do
not add significantly more) to transform the abstract idea into a patent
10
Appeal 2016-005917
Application 13/332,721
eligible application. See e.g., Final Act. 2. Indeed, the claim merely recites
processes for optimizing pricing, e.g., utilizing database and mathematical
operations. Such steps are all routine and conventional and well-understood
computer functions (i.e., mathematical operations) of a general processor.
The Specification supports this view in discussing the processes
implemented in software which operates on generic computers to perform
the recited data manipulation steps. See Spec. 14—17. “[T]he use of
generic computer elements like a microprocessor” to perform conventional
computer functions “do not alone transform an otherwise abstract idea into
patent-eligible subject matter.” FairWarningIP, LLC v. Iatric Sys., Inc.,
839 F.3d 1089, 1096 (Fed. Cir. 2016) (citing DDR Holdings, 773 F.3d at
1256).
Moreover, we find this type of activity, i.e., receiving, collecting,
processing, analyzing, and manipulating pricing data to determine optimized
pricing includes longstanding conduct that existed well before the advent of
computers and the Internet, and could be carried out by human thought alone
or by a human with pen and paper. See CyberSource Corp. v. Retail
Decisions, Inc., 654 F.3d 1366, 1375 (Fed. Cir. 2011) (“That purely mental
processes can be unpatentable, even when performed by a computer, was
precisely the holding of the Supreme Court in Gottschalk v. Benson’’ ).3
For at least the reasons above, we are not persuaded of Examiner error
in the rejection of claim 1 under 35 U.S.C. § 101. Thus, we sustain the
Examiner’s rejection under § 101 of independent claims 1, 8, and 15, and
3 Cybersource further guides that “a method that can be performed by
human thought alone is merely an abstract idea and is not patent-eligible
under § 101.” Cybersource, 654 F.3d at 1373.
11
Appeal 2016-005917
Application 13/332,721
also dependent claims 3—7, 10-14, and 17—21, which fall with claims 1,8,
and 15, respectively.
The 35 U.S.C. § 103(a) Rejection
Appellants argue independent claims 1, 8 and 15 together as a group
with respect to the § 103(a) rejection. See App. Br. 9-12. We select
independent claim 1 as representative of Appellants’ arguments with respect
to claims 1, 3—8, 10-15, and 17—21. 37 C.F.R. § 41.37(c)(l)(iv).
The Examiner rejects independent claim 1 as being obvious in view of
Molvalioglu and Boyd. See Final Act. 3—5; Ans. 6—14. Appellants contend
Molvalioglu and Boyd do not teach the disputed features of claim 1. See
App. Br. 9—12. Specifically, Appellants contend the Examiner “improperly
glosses over” (App. Br. 10) the recited claim features and does not
sufficiently map the disputed claim limitations to the cited prior art. See
App. Br. 9—12; Reply Br. 4—6. The Examiner repeats the language of the
claim and cites multiple disparate portions of Molvalioglu and Boyd as
teaching the recited limitations. See Final Act. 3—5; Ans. 6—14. While the
Examiner does provide a detailed chart purported mapping limitations of
claim 1 to Molvalioglu, the Examiner does not sufficiently explain how the
disclosures of Molvalioglu teach or suggest the disputed claim features.
Appellants persuade us of error in the Examiner’s obviousness
rejection. The Examiner provides no clear mapping or explanation between
the disputed claim limitations and disclosures of Molvalioglu and Boyd.
Further, the cited portions of Molvalioglu appear to conflate the various
processes recited in Appellants’ claim 1. See, e.g., Ans. 8—9; De La Huerga
p. 331 (N-Particle Exploration utilized for both exploiting and exploring
limitations).
12
Appeal 2016-005917
Application 13/332,721
Consequently, we are constrained by the record before us to find that
the Examiner erred in finding Molvalioglu and Boyd teach the disputed
limitations of Appellants’ claim 1. Independent claims 8 and 15 include
limitations of commensurate scope. Dependent claims 3—7, 10-14, and 17—
21 depend on claims 1, 8, and 15, respectively, and stand with their
respective independent claims. Accordingly, we reverse the Examiner’s
obviousness rejection of claims 1, 3—8, 10-15, and 17—21.
CONCLUSIONS
Appellants have not shown that the Examiner erred in rejecting claims
1, 3-8, 10-15, and 17-21 under 35 U.S.C. § 101.
Appellants have shown that the Examiner erred in rejecting claims 1,
3-8, 10-15, and 17-21 under 35 U.S.C. § 103(a).
Because we have affirmed at least one ground of rejection with
respect to each claim on appeal, the Examiner’s decision is affirmed. See 37
C.F.R. §41.50(a)(1).
DECISION
We affirm the Examiner’s rejection of claims 1, 3—8, 10—15, and 17—
21.
13
Appeal 2016-005917
Application 13/332,721
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).
AFFIRMED
14