Kris BliesnerDownload PDFPatent Trials and Appeals BoardDec 10, 201913865952 - (D) (P.T.A.B. Dec. 10, 2019) 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. 13/865,952 04/18/2013 Kris BLIESNER S234-0002US 3644 29150 7590 12/10/2019 LEE & HAYES, P.C. 601 W. RIVERSIDE AVENUE SUITE 1400 SPOKANE, WA 99201 EXAMINER CHEIN, ALLEN C ART UNIT PAPER NUMBER 3687 NOTIFICATION DATE DELIVERY MODE 12/10/2019 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): lhpto@leehayes.com PTOL-90A (Rev. 04/07) UNITED STATES PATENT AND TRADEMARK OFFICE BEFORE THE PATENT TRIAL AND APPEAL BOARD Ex parte KRIS BLIESNER Appeal 2018-000183 Application 13/865,952 Technology Center 3600 Before ALLEN R. MacDONALD, JASON V. MORGAN, and JOHN R. KENNY, Administrative Patent Judges. KENNY, Administrative Patent Judge. DECISION ON APPEAL STATEMENT OF THE CASE Pursuant to 35 U.S.C. § 134(a), Appellant1 appeals from the Examiner’s decision to reject claims 1–21. We have jurisdiction under 35 U.S.C. § 6(b). We AFFIRM. 1 We use the word Appellant to refer to “applicant” as defined in 37 C.F.R. § 1.42(a). Appellant identifies the real party in interest as 2nd Watch, Inc. Appeal Br. 3. Appeal 2018-000183 Application 13/865,952 2 SPECIFICATION Appellants’ Specification is directed to methods for providing billing services for resellers of cloud computing commodities. Spec. ¶ 2. ILLUSTRATIVE CLAIMS Claims 1 and 5, reproduced below, are illustrative of the claimed subject matter: 1. A method for distributing a consolidated bill for cloud computing services comprising: obtaining, by a rebilling server from a cloud-computing- services provider during a billing period, the consolidated bill; identifying, by the rebilling server, a plurality of entities that were billed at a blended billing rate determined based at least in part on aggregate usage of a cloud-computing resource in one or more variously shared network devices in a heterogeneous distributed computing environment by the identified plurality of entities, and further based at least in part on a plurality of term- based discount entitlements associated with the identified plurality of entities; selecting, by the rebilling server, an entity of the identified plurality of entities as being individually associated with one or more entity-specific term-based discount entitlements; obtaining, by the rebilling server, periodic usage statistics corresponding to cloud-computing-resource usage in the one or more variously shared network devices specific to the selected entity during the billing period; determining, by the rebilling server, based at least in part on the periodic usage statistics and the one or more entity- specific term-based discount entitlements, a first billing rate for a first amount of the cloud-computing resource in association with a cost increment and specific to at least some of the entity- specific cloud-computing-resource usage, the first billing rate being a discounted billing rate; Appeal 2018-000183 Application 13/865,952 3 determining, by the rebilling server, based at least in part on the periodic usage statistics, a second billing rate for a second amount of the cloud-computing resource in association with the cost increment and applicable to at least some of the entity- specific cloud-computing-resource usage to which the one or more entity-specific term-based discount entitlements does not apply; computing, by the rebilling server, based at least in part on the first billing rate for the first amount of the cloud-computing resource in association with the cost increment and, on the second billing rate, and on the periodic usage statistics, an unblended entity-specific cost for the second amount of the cloud-computing resource in association with the cost increment for the selected entity corresponding to the entity-specific cloud- computing-resource usage, the first amount of the cloud- computing resource being a higher amount of the cloud- computing resource than the second amount of the cloud- computing resource; and storing, by the rebilling server, the unblended entity- specific cost for the higher amount of the cloud-computing resource in association with the cost increment for the selected entity, the cloud-computing resource being selected from a group consisting of memory, storage, and bandwidth. 5. The method of Claim 4, further comprising: identifying, according to the periodic usage statistics, cloud-computing-resource usage by the selected entity that was billed at the second billing rate, but that with an immaterial modification could have been billed at the first billing rate for a first amount of the cloud computing resource in association with a cost increment and according to an un-utilized term based discount entitlement; wherein the immaterial modification comprises re-provisioning at least one cloud-computing commodity from a standard-priced smaller instance to a larger reserved instance; and Appeal 2018-000183 Application 13/865,952 4 recommending the re-provisioning of the at least one cloud-computing commodity. REJECTION Claims 1–21 stand rejected under 35 U.S.C. § 101 as directed to patent ineligible subject matter. Final Act. 7. ANALYSIS A. Section 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. However, the Supreme Court has long interpreted 35 U.S.C. § 101 to include implicit exceptions: “[l]aws of nature, natural phenomena, and abstract ideas” are not patentable. E.g., Alice Corp. v. CLS Bank Int’l, 573 U.S. 208, 216 (2014). In determining whether a claim falls within an exception, we are guided by the Supreme Court’s two-step framework, described in Mayo and Alice. Alice, 573 U.S. at 217–18 (citing Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66, 75–77 (2012)). In accordance with that framework, we first determine what concept the claim is “directed to.” See Alice, 573 U.S. at 219 (“On their face, the claims before us are drawn to the concept of intermediated settlement, i.e., the use of a third party to mitigate settlement risk.”) (emphasis omitted); see also Bilski v. Kappos, 561 U.S. 593, 611 (2010) (“Claims 1 and 4 in petitioners’ application explain the basic concept of hedging, or protecting against risk.”). Concepts determined to be abstract ideas, and, thus, patent ineligible, include certain methods of organizing human activity, such as fundamental economic practices (Alice, 573 U.S. at 219–20; Bilski, 561 U.S. at 611); Appeal 2018-000183 Application 13/865,952 5 mathematical formulas (Parker v. Flook, 437 U.S. 584, 594–95 (1978)); and mental processes (Gottschalk v. Benson, 409 U.S. 63, 67 (1972)). Concepts determined to be patent eligible include physical and chemical processes, such as “molding [of] rubber products” (Diamond v. Diehr, 450 U.S. 175, 191 (1981)); “tanning, dyeing, making water-proof cloth, vulcanizing India rubber, smelting ores” (id. at 182 n.7 (quoting Corning v. Burden, 56 U.S. 252, 267–68 (1854))); and manufacturing flour (Benson, 409 U.S. at 69 (citing Cochrane v. Deener, 94 U.S. 780, 785 (1876))). In Diehr, the claim at issue recited a mathematical formula, but the Supreme Court held that “a claim drawn to subject matter otherwise statutory does not become nonstatutory simply because it uses a mathematical formula.” Diehr, 450 U.S. at 187, 191 (“We view respondents’ claims as nothing more than a process for molding rubber products and not as an attempt to patent a mathematical formula.”). Having said that, the Supreme Court also indicated that a claim “seeking patent protection for that formula in the abstract . . . . is not accorded the protection of our patent laws . . . and this principle cannot be circumvented by attempting to limit the use of the formula to a particular technological environment.” Id. at 191 (citing Benson and Flook); id. at 187 (“It is now commonplace that an application of a law of nature or mathematical formula to a known structure or process may well be deserving of patent protection.”) (Emphasis omitted). If the claim is “directed to” an abstract idea, we turn to the second step of the Alice and Mayo framework, where “we must examine the elements of the claim to determine whether it contains an ‘inventive Appeal 2018-000183 Application 13/865,952 6 concept’ sufficient to ‘transform’ the claimed abstract idea into a patent- eligible application.” Alice, 573 U.S. at 221 (quoting Mayo, 566 U.S. at 72, 79). “A claim that recites an abstract idea must include ‘additional features’ to ensure ‘that the [claim] is more than a drafting effort designed to monopolize the [abstract idea].’” Id. (alterations in original) (quoting Mayo, 566 U.S. at 77). “[M]erely requir[ing] generic computer implementation[] fail[s] to transform that abstract idea into a patent-eligible invention.” Id. B. USPTO Section 101 Guidance The United States Patent and Trademark Office (“USPTO”) recently published revised guidance on the application of section 101. USPTO’s January 7, 2019 Guidance, 2019 Revised Patent Subject Matter Eligibility Guidance, 84 Fed. Reg. 50 (“Guidance”); see also USPTO, October 2019 Update: Subject Matter Eligibility, available at https://www.uspto.gov/sites/ default/files/documents/peg_oct_2019_update.pdf (Oct. 17, 2019). Under that Guidance, we first look to whether the claim recites: (1) (see Guidance Step 2A—Prong One) any judicial exceptions, including certain groupings of abstract ideas (i.e., mathematical concepts, certain methods of organizing human activity such as commercial or legal interactions, or mental processes); and (2) (see Guidance Step 2A—Prong Two) additional elements that integrate the judicial exception into a practical application (see MPEP §§ 2106.05(a)–(c), (e)–(h)). Only if a claim (1) recites a judicial exception and (2) does not integrate that exception into a practical application, do we then look to whether the claim: (3) adds a specific limitation beyond the judicial exception that is not “well-understood, routine, conventional” in the field (see MPEP § 2106.05(d)); or Appeal 2018-000183 Application 13/865,952 7 (4) simply appends well-understood, routine, conventional activities previously known to the industry, specified at a high level of generality, to the judicial exception. See Guidance Step 2B. C. Representative Claims Appellant argues claims 1, 3, 7–21 as a group and claims 2, 4, 5, and 6 as a group. Appeal Br. 18–26. We select claims 1 and 5 as representative of these respective groups.2 See 37 C.F.R. § 41.37(c)(1)(iv). D. Claim 1 We agree with the Examiner that claim 1 does not recite eligible subject matter for the reasons discussed below. 1. Alice Step One a. USPTO Step 2A—Prong One The Examiner determines that claim 1 is directed to, for example, analyzing a bill for cloud computing services. Final Act. 7. Appellant argues that Examiner erred by not analyzing claim 1 as a whole and argues that this case is not analogous to the cases establishing subject matter ineligibility. Appeal Br. 17–20. Consistent with the Examiner’s findings, we determine that claim 1 recites fundamental economic practices and commercial interactions, which are two of the certain methods of organizing human activity identified in the Guidance as constituting abstract ideas. Guidance 52 (identifying “fundamental economic . . . practices” and “commercial or legal interactions 2 We chose claim 5 because Appellant specifically addresses limitations of claim 5 when arguing for the patentability of claims 2, 4, 5, and 6. Appeal Br. 24–25. Appeal 2018-000183 Application 13/865,952 8 (including agreements in the form of contracts; legal obligations; advertising, marketing or sales activities or behaviors; business relations” as among the certain methods of organizing human activity that are abstract ideas). The preamble or claim 1 recites “[a] method for distributing a consolidated bill for cloud computing.” A method for distributing a bill is both a fundamental economic practice and a commercial interaction. Claim 1 also recites: obtaining a consolidated bill, identifying entities billed at particular rates, selecting entities with discount entitlements, determining usage statistics, determining first and second billing rates, computing an entity specific cost, and storing the entity specific cost. All of these recitations recite both fundamental economic practices and commercial interactions, and, therefore, recite abstract ideas. Guidance 52 n. 13; see also Alice, 573 U.S. at 219–20 (concluding that use of a third party to mediate settlement risk is a fundamental economic practice); id. (describing the concept of risk hedging in Bilski as a method of organizing human activity”); Bilski, 561 U.S. at 611–12 (concluding that hedging is a “fundamental economic practice”); Inventor Holdings, LLC v. Bed Bath & Beyond, Inc., 876 F.3d 1372, 1378–79 (Fed. Cir. 2017) (holding that concept of “local processing of payments for remotely purchased goods” is a “fundamental economic practice.”). b. USPTO Step 2A—Prong Two Prong Two of the Guidance instructs us to examine whether a claim recites additional elements that integrate a judicial exception into a practical application and to do so by evaluating the claim as a whole. Guidance 54. Appeal 2018-000183 Application 13/865,952 9 One exemplary consideration is whether an additional element reflects an improvement in the functioning of a computer or an improvement to other technology or a technical field. Id. at 55. Appellant argues that the following recitations in claim 1 are directed to an improvement in technology: computing . . . an unblended entity-specific cost for the second amount of the cloud-computing resource in association with the cost increment . . . corresponding to the entity-specific cloud- computing-resource usage, the first amount of the cloud- computing resource being a higher amount . . . than the second amount of the cloud-computing resource; and storing . . . the unblended entity-specific cost for the higher amount of the cloud-computing resource in association with the cost increment . . . the cloud-computing resource being selected from a group consisting of memory, storage, and bandwidth. Appeal Br. 20–21. We are not persuaded by this argument. The quoted recitations are directed to billing for a cloud-computing resource, rather than a technological improvement regarding cloud computing. Consistent with this fact, the Specification describes its disclosure as being “directed to providing billing services for resellers of cloud computing commodities.” Spec. ¶ 2. And “merely limiting the field of use of the abstract idea to a particular existing technological environment does render the claims any less abstract.” Affinity Labs of Texas, LLC v. DIRECTV, LLC, 838 F.3d 1253, 1259 (Fed. Cir. 2016). Appellant also argues that claim 1 is analogous to claim 2 of Example 21 provided in the USPTO’s July 2015 Update Appendix 1: Examples. (“July 2015 Appendix”). Appeal Br. 23–24. We disagree. Claim 2 in Example 21 “addresses the Internet-centric challenge of alerting a subscriber with time sensitive information when the subscriber’s computer is offline.” Appeal 2018-000183 Application 13/865,952 10 July 2015 Appendix, 4. Claim 2 does this “by transmitting the alert over a wireless communication channel to activate the stock viewer application, which causes the alert to display and enables the connection of the remote subscriber computer to the data source over the Internet when the remote subscriber computer comes online.” Id. As Example 21 explains, “[t]hese are meaningful limitations that add more than generally linking the use of the abstract idea (the general concept of organizing and comparing data) to the Internet, because they solve an Internet‐centric problem with a claimed solution that is necessarily rooted in computer technology.” Id. In contrast, the quoted recitations above limit billing practices, not computer technology. The Guidance lists other indicia of integration. Guidance 55. None are present in claim 1. For example, “[t]ransformation and reduction of an article ‘to a different state or thing’ is the clue to patentability of a process claim that does not include particular machines.” Bilski, 561 U.S. at 604 (emphasis added), quoted in MPEP § 2106.05(c). Yet “not all transformations . . . infuse an otherwise ineligible claim with an ‘inventive concept.”’ DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245, 1256 (Fed. Cir. 2014). Claim 1's method does not transform a physical object or substance. In this way, the claim is unlike the transformations found in some eligible claims. See, e.g., Diehr, 450 U.S. at 184 (a process that transforms rubber). Therefore, claim 1 does not integrate a judicial exception into a practical application. Appeal 2018-000183 Application 13/865,952 11 2. Alice Step Two/USPTO Step 2B For Alice Step Two, Appellant argues the elements of claim 1 recite a non-conventional and non-generic arrangement of features and, therefore, are patent eligible under Bascom Global Internet Services, Inc. v. AT&T Mobility LLC, 827 F.3d 1341 (Fed. Cir. 2016). Appeal Br. 25–26. In particular, Appellant asserts that “claim 1 recites a non-conventional arrangement of features for conducting a ‘method for distributing a consolidated bill for cloud computing services,’ such as ‘an unblended entity-specific cost,’ multiple ‘billing rates,’ ‘cost increments,’ ‘discount entitlements,’ and ‘entity specific cloud-computing-resource usage,’ which in combination allow for the unblended entity specific cost.” Id. at 26. We are not persuaded by this argument because this purportedly non- conventional arrangement of features is directed to a solution for billing practices, not any improvement in technology, like in Bascom. Bascom, 827 F.3d at 1351 (“The . . . patent [challenged in Bascom] is . . . claiming a technology-based solution (not an abstract-idea based solution implemented with generic technical components in a conventional way) . . . .”). Thus, we determine claim 1 does not have additional recitations that individually or as an ordered combination make it significantly more than its patent-ineligible abstract idea. 3. Preemption Appellants further argue that claim 1 is patent eligible because, even if the claim were deemed to recite an abstract idea, claim 1 would not preempt others from using any such idea. Appeal Br. 27. We are not persuaded by this assertion because even if we were to accept the proposition that claim 1 Appeal 2018-000183 Application 13/865,952 12 would not preempt any abstract idea, that proposition would not render claim 1 patent eligible. Although preemption may denote patent ineligibility, its absence does not demonstrate patent eligibility. See FairWarning, IP, LLC v. Iatric Sys., Inc., 839 F.3d 1089, 1098 (Fed. Cir. 2016). For claims covering a patent-ineligible concept, preemption concerns “are fully addressed and made moot” by an analysis under the Mayo/Alice framework. Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir. 2015). Thus, we sustain the section 101 rejection of claim 1, and of claims 3 and 7–21, not argued separately. E. Claim 5 Claim 5 incorporates the limitations of claim 1 by dependency. The analysis regarding those incorporated limitations is the same as for claim 1. Further, relying on a limitation expressly recited by claim 5, Appellant argues that claim 5 contains “features that amount to ‘significantly more’ than the alleged abstract idea because the claimed features solve a problem that is necessarily rooted in computer technology in order to overcome a problem specifically arising in the realm of cloud computing systems, and improve the functioning of the computer itself.” Appeal Br. 24. This argument could be directed to Prong Two of USPTO Guidance Step 2A. Appellant notes that the Specification discloses that “the functionality provided by a commodity usage would not be materially impaired by switching from a less capable class of computing commodity usage to a more capable class of the same service.” Id. at 25 (quoting Spec. ¶ 59). Appellant argues that “in many instances there may be potential savings ‘that may be available by making immaterial modifications such as re- Appeal 2018-000183 Application 13/865,952 13 provisioning certain commodity usage to make more efficient use of available discount entitlements.’” Id. (quoting Spec. ¶ 61). Further, Appellant asserts “claim 5 recites, a recommendation can be made based on the determinations of the method for ‘re-provisioning’ ‘at least one cloud- computing commodity from a standard-priced smaller instance to a larger reserved instance.’” Id. According to Appellant, “[r]e-provisioning can result in processing power and memory being better utilized by cloud- computing systems while maintaining the same level of performance, and savings may be experienced by users of the cloud-computing systems.” Id. We are not persuaded by these arguments. Claim 5 merely recites providing a recommendation for lowering billing costs by transitioning from one class of computing to another. The recitations of claim 5 concern billing practices and recommendations, rather than solutions regarding computer technology. Thus, we sustain the section 101 rejection of claim 5 and of claims 2, 4, and 6, not separately argued. CONCLUSION The Examiner’s rejection is affirmed. DECISION SUMMARY In summary: Claims Rejected 35 U.S.C. § Reference(s)/Basis Affirmed Reversed 1–21 101 Eligibility 1–21 Appeal 2018-000183 Application 13/865,952 14 TIME PERIOD FOR RESPONSE 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 Copy with citationCopy as parenthetical citation