Ex Parte Neofytides et al

Patent Trial and Appeal Board

Oct 9, 2018

10046654 (P.T.A.B. Oct. 9, 2018)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE FIRST NAMED INVENTOR
10/046,654 10/26/2001
20350 7590 10/11/2018
KILPATRICK TOWNSEND & STOCKTONLLP
Mailstop: IP Docketing - 22
1100 Peachtree Street
Suite 2800
Atlanta, GA 30309
UNITED ST A TES OF AMERICA
Cheryl L. Neofytides
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.
87188-636306 (000220US) 1069
EXAMINER
AKINTOLA, OLABODE
ART UNIT PAPER NUMBER
3691
NOTIFICATION DATE DELIVERY MODE
10/11/2018 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):
ipefiling@kilpatricktownsend.com
KTSDocketing2@kilpatrick.foundationip.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte CHERYLL. NEOFYTIDES, AAMER ALI BAIG,
PETER M. KARAS, JAMES E. COWELL, JAMES R. YODER,
and MATT F. GOLUB
Appeal2017-003304 1
Application 10/046,6542
Technology Center 3600
Before MICHAEL W. KIM, NINA L. MEDLOCK, and
BRUCE T. WIEDER, Administrative Patent Judges.
MEDLOCK, Administrative Patent Judge.
DECISION ON APPEAL
1 Our decision references Appellants' Appeal Brief ("App. Br.," filed
September 13, 2016) and Reply Brief ("Reply Br.," filed December 27,
2016), and the Examiner's Answer ("Ans.," mailed October 28, 2016) and
Non-Final Office Action ("Non-Final Act.," mailed May 6, 2016).
2 Appellants identify First Data Corporation as the real party in interest.
App. Br. 3.
Appeal2017-003304
Application 10/046,654
STATEMENT OF THE CASE
Appellants appeal under 35 U.S.C. § 134(a) from the Examiner's
rejection of claims 25-37, 50, and 52-54. We have jurisdiction under
35 U.S.C. § 6(b ).
We AFFIRM.
CLAIMED INVENTION
Appellants' claimed invention "relates generally to stored value fund
transactions, and more particularly relates to transferring money between
parties with a network-accessible stored value fund" (Spec. 1, 11. 6-8).
Claim 25, reproduced below, is the sole independent claim, and
representative of the claimed subject matter:
25. A method for automatically transferring credit
between a stored value fund maintained in a data base and a
handler using a wide-area computer network, the method
compnsmg:
establishing a stored value fund at the data base and
associating the stored value fund with a user, and from which a
desired amount is to be transferred from the user to a payee;
receiving, at a server computer system having a payment
controller, automated transfer information from the wide-area
computer network coupled to a user associated with the stored
value fund, the automated transfer information comprising
handler information on a plurality of handlers, including one of
the handlers that is selected by a user for an automated transfer
and one of the handlers that is selected by the user as a default
handler;
determining at the payment controller the handler for an
automated transfer;
determining at the payment controller the direction of the
automated transfer with respect to the stored value fund;
determining at the payment controller an amount for the
automated transfer;
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automatically transferring the automated transfer amount
between the stored value fund in the data base and the handler
determined for use for the automated transfer;
after the automated transfer, determining if there are
sufficient funds in the stored value fund to make the transfer of
the desired transfer amount to the payee;
if there are not sufficient funds in the stored value fund to
make the transfer of the desired transfer amount, transferring
additional funds from the default handler to the stored value
fund; and
after the automated transfer and any transfer of additional
funds from the default handler, converting the funds in the stored
value fund from one form of monetary value to a different form
of monetary value, wherein the stored value fund has plural,
different forms of monetary value as funds in the stored value
fund, wherein the handlers each use different forms of monetary
value, and wherein the different forms of monetary value are
converted according to the handler used for the transfer of funds
by querying such handler for an exchange rate to be used for the
convers10n.
REJECTION
Claims 25-37, 50, and 52-54 are rejected under 35 U.S.C. § 101 as
directed to a judicial exception without significantly more.
ANALYSIS
Under 35 U.S.C. § 101, an invention is patent-eligible if it claims a
"new and useful process, machine, manufacture, or composition of matter."
35 U.S.C. § 101. The Supreme Court, however, has long interpreted§ 101
to include an implicit exception: "[l]aws of nature, natural phenomena, and
abstract ideas" are not patentable. Alice Corp. v. CLS Bank Int 'l, 134 S. Ct.
2347, 2354 (2014).
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The Supreme Court, in Alice, reiterated the two-step framework
previously set forth in Mayo Collaborative Services v. Prometheus
Laboratories, Inc., 566 U.S. 66 (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 Corp., 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. If the
claims are not directed to a patent-ineligible concept, e.g., 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 there are additional elements that
"'transform the nature of the claim' into a patent-eligible application." Id.
(quoting Mayo, 566 U.S. at 79, 78).
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. Therefore, the Federal Circuit has
instructed that claims are to be considered in their entirety to determine
"whether their character as a whole is directed to excluded subject matter."
McRO, Inc. v. Bandai Namco Games Am., Inc., 837 F.3d 1299, 1312
(Fed. Cir. 2016) (quoting Internet Patents Corp. v. Active Network, Inc.,
790 F.3d 1343, 1346 (Fed. Cir. 2015)).
In rejecting the pending claims under 35 U.S.C. § 101, the Examiner
determined that independent claim 25 is directed to an abstract idea, i.e.,
(1) "transferring credit between the stored value fund and handler," which
the Examiner reasoned is similar to a method of organizing human activity
found abstract by the courts, and (2) "conversion of funds from one
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monetary value to a different form of monetary value," which the Examiner
concluded is akin to "the concept of gathering and combining data by
reciting steps of organizing information through mathematical since the
conversion necessarily requires [a] mathematical algorithm" (Non-Final
Act. 3). The Examiner further determined that claim 25 does not include
additional elements or a combination of elements sufficient to transform the
claim into a patent-eligible application of the abstract idea, and that
dependent claims 26-37, 50, and 52-54 are patent-ineligible based on the
same analysis (id. at 3--4).
Appellants assert that the claims are not directed to an abstract idea,
and argue that the§ 101 rejection cannot be sustained, because the Examiner
has characterized the claims at an impermissibly high level of abstraction
that does not properly reflect the concept recited in the claims (App. Br. 6).
Appellants assert that the claims are properly characterized as directed to
[a] method, using a database, [a] server computer having a
payment controller[,] and a wide-area computer network, for
transferring funds from a handler (e.g., a credit/debit card, bank,
promotion program, money transfer agent location) to a stored
value fund or account of a user, in order to be transferred to a
payee
(id. at 7). Appellants note that "[a]n automated transfer handler and a
default handler are used to transfer value to the stored value fund"; "[t]he
stored value fund has different forms of monetary value, and the handlers
use different forms of monetary value"; and "[t]he conversion of monetary
value in the stored value fund is accomplished with an exchange rate at the
handler used in the transfer" (id.). And Appellants submit that the "above
referenced inventive concept (properly 'tethered' to the actual language of
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the claims and identified using a more appropriate level of abstraction) is
patent-eligible subject matter under 35 U.S.C. § 101" (id.).
Appellants' argument is not persuasive at least because the
Examiner's formulation of the abstract idea need not copy the language
recited in the claim. Instead, the Federal Circuit has explained that "the
'directed to' inquiry applies a stage-one filter to claims, considered in light
of the [S]pecification, based on whether 'their character as a whole is
directed to excluded subject matter."' See Enfish, LLC v. Microsoft Corp.,
822 F.3d 1327, 1335 (Fed. Cir. 2016) (citing Internet Patents Corp.,
790 F.3d at 1346). It asks whether the focus of the claims is on a specific
improvement in relevant technology or on a process that itself qualifies as an
"abstract idea" for which computers are invoked merely as a tool. See id.
at 1335-36.
The Examiner's determination here that the claims are directed to
"transferring credit between the stored value fund and handler" and
"conversion of funds from one monetary value to a different form of
monetary value" is fully consistent with the Specification, including the
claim language (see, e.g., Spec. 2, 1. 31- 3, 1. 12; 6, 1. 31 - 7, 1. 5).
An abstract idea, moreover, can be expressed at various levels of
abstraction. See Apple, Inc. v. Ameranth, Inc., 842 F.3d 1229, 1240-41
(Fed. Cir. 2016) ("An abstract idea can generally be described at different
levels of abstraction. As the Board has done, the claimed abstract idea could
be described as generating menus on a computer, or generating a second
menu from a first menu and sending the second menu to another location. It
could be described in other ways, including, as indicated in the specification,
taking orders from restaurant customers on a computer."). That the claim
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language includes more words than the phrase the Examiner used to
articulate the abstract idea, and that the Examiner, thus, articulates the
abstract idea at a higher level of abstraction than do Appellants is an
insufficient basis, at least in this instance, for finding that the claims are not
directed to an abstract idea.
Further referencing the USPTO's "July 2015 Update: Subject Matter
Eligibility," Appellants ostensibly argue that the§ 101 rejection cannot be
sustained because the abstract ideas in Planet Bingo, LLC v. VKGS, LLC,
576 F. App'x 1005 (Fed. Cir. 2014) and Accenture Global Services, GmbH
v. Guidewire Software, 728 F.3d 1336 (Fed. Cir. 2013), cited by the
Examiner, are "not similar to the abstract idea in the present application,
either as characterized by the Examiner ... or ... by Appellant[ s ]" (App.
Br. 7-8; see also Reply Br. 3). 3 Yet, even accepting Appellants' argument,
Appellants cannot reasonably deny that transferring money between parties
is a long-standing practice, i.e., a fundamental economic practice, and,
therefore, an abstract idea. In fact, Appellants ostensibly acknowledge as
much in the "Background" section of the Specification (see Spec. 1, 11. 5-
18).
Turning to the second step of the Mayo/Alice framework, Appellants
argue that even if claim 25 is directed to an abstract idea, the claim recites
3 The July 2015 Update (available at https://www.uspto.gov/sites/
default/files/documents/ieg-july-2015-update.pdf) instructs examiners to
refer to the body of case law precedent in order to identify abstract ideas by
way of comparison to concepts already found to be abstract (id. at 3), and
explains that "[t]his discussion is meant to ... ensure that a claimed concept
is not identified as an abstract idea unless it is similar to at least one concept
that the courts have identified as an abstract idea" (id.).
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significantly more than the alleged abstract idea, i.e., "transferring credit
between the stored value fund and handler" and "conversion of funds from
one monetary value to a different form of monetary value" (App. Br. 8).
Yet, to the extent Appellants maintain that the claimed invention is patent-
eligible, i.e., that the claim amounts to "significantly more" than an abstract
idea, and/or that the recited functions are not "well-understood, routine, and
conventional activities," because claim 25 is allegedly novel and/or non-
obvious in view of the prior art (see App. Br. 9), Appellants misapprehend
the controlling precedent.
A finding of novelty or non-obviousness does not automatically lead
to the conclusion that the claimed subject matter is patent-eligible. Although
the second step in the Mayo/Alice framework is termed a search for an
"inventive concept," the analysis is not an evaluation of novelty or non-
obviousness, but rather, a search for "an element or combination of elements
that is 'sufficient to ensure that the patent in practice amounts to
significantly more than a patent upon the [ineligible concept] itself.'" Alice
Corp., 134 S. Ct. at 2355 (citation omitted). "Groundbreaking, innovative,
or even brilliant discovery does not by itself satisfy the § 101 inquiry."
Ass 'nfor Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. 576, 591
(2013). A novel and non-obvious claim directed to a purely abstract idea is,
nonetheless, patent-ineligible. See Mayo, 566 U.S. at 90; see also Diamond
v. Diehr, 450 U.S. 175, 188-89 (1981) ("The 'novelty' of any element or
steps in a process, or even of the process itself, is of no relevance in
determining whether the subject matter of a claim falls within the § 101
categories of possibly patentable subject matter.").
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We also are not persuaded of Examiner error by Appellants' argument
that the claims do not attempt to preempt every application of the abstract
ideas as characterized by the Examiner (App. Br. 9; see also Reply Br. 3--4).
There is no dispute that the Supreme Court has described "the concern that
drives [the exclusion of abstract ideas from patent eligible subject matter] as
one of pre-emption." Alice Corp., 134 S. Ct. at 2354. But characterizing
preemption as a driving concern for patent eligibility is not the same as
characterizing pre-emption as the sole test for patent eligibility. "The
Supreme Court has made clear that the principle of preemption is the basis
for the judicial exceptions to patentability" and "[f]or this reason, questions
on preemption are inherent in and resolved by the§ 101 analysis." Ariosa
Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir. 2015)
(citing Alice Corp., 134 S. Ct. at 2354). "[P]reemption may signal patent
ineligible subject matter, [but] the absence of complete preemption does not
demonstrate patent eligibility." Id.
We are not persuaded, on the present record, that the Examiner erred
in rejecting claim 25 under 35 U.S.C. § 101. Therefore, we sustain the
Examiner's rejection. We also sustain the rejection of dependent claims 26-
37, 50, and 52-54, which are not argued separately.
DECISION
The Examiner's rejection of claims 25-37, 50, and 52-54 under
35 U.S.C. § 101 is affirmed.
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
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