MasterCard International Incorporated

Patent Trials and Appeals Board

Aug 21, 2020

15154177 - (D) (P.T.A.B. Aug. 21, 2020)

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.
15/154,177 05/13/2016 Brigette White P01858-US-
UTIL (M01.328)
4451
125619 7590 08/21/2020
Mastercard International Incorporated
c/o Buckley, Maschoff & Talwalkar LLC
50 Locust Avenue
New Canaan, CT 06840
EXAMINER
GREGG, MARY M
ART UNIT PAPER NUMBER
3697
NOTIFICATION DATE DELIVERY MODE
08/21/2020 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):
colabella@bmtpatent.com
martin@bmtpatent.com
szpara@bmtpatent.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte BRIGETTE WHITE, THEUNIS JOHANNES GERBER, and
JULIA GOSSET
Appeal 2019-006495
Application 15/154,177
Technology Center 3600
Before JEAN R. HOMERE, GREGG I. ANDERSON, and
MICHAEL M. BARRY, Administrative Patent Judges.
ANDERSON, 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 1–25. Appeal Br. 2. 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 MasterCard
International Incorporated. Appeal Br. 2.
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CLAIMED SUBJECT MATTER
The claims are directed to an Enhanced Payment Card Platform.
Spec.,2 Title. Prior payment card systems are described as operated by, for
example, the assignee, “MasterCard International Incorporated.” Id. at
1:15–18. Figure 1 from the Specification, reproduced below, is illustrative.

Figure 1 “is a simplified block diagram of a conventional payment card
system.” Id. at 5:1. The payment cards include “a debit card account, a
credit card account, a prepaid card account, a loyalty card account, or the
like.” Id. at 2:12–14.
The “enhanced” payment card platform” allows an “account holder to
select benefits from a list provided by a benefits provider.” Spec., 5:22–24.
Benefits may include “enhanced levels of customer service, to provide
enhanced fraud monitoring and solutions, and to cover any amounts that

2 We use “Spec.” to refer to the Specification filed May 13, 2016, “Final
Act.” to refer to the Final Office Action dated October 18, 2018, “Appeal
Br.” to refer to Appellant’s Brief filed March 15, 2019, “Ans.” to refer to the
Examiner’s Answer filed July 3, 2019, and “Reply Br.” to refer to
Appellant’s Reply Brief filed August 30, 2019.

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3
must be paid (or paid back) to issuer FIs [financial institutions] for any
fraudulent activity that may occur.” Id. at 22:9–11. For example, the issuer
FI receives a recommended decision score, including factors relating to
fraud risk, relative to whether to authorize purchase transaction. Id. at
24:28–31. The FI then makes a decision as to whether to authorize the
transaction, and may overrule an initial decline decision as an enhanced
benefit. Id. at 25:6–14.
If a decline decision is overruled, the transaction may turn out to be
fraudulent, in which case the FI receives a fraud message. Spec. 26:17–20.
A clearing and settlement system then transfers a monetary amount from a
fraud expense pool to the FI to reimburse costs associated with the
fraudulent purchase transaction. Id. at 26:20–24.
Claims 1 and 16 are representative (see Appeal Br. 20, 26) and are
reproduced below, are illustrative of the claimed subject matter:
1. An enhanced payment card account method comprising:

receiving, by a fraud scoring platform from a payment network,
purchase transaction information and an associated decline
decision generated by an issuer financial institution (FI)
computer for a purchase transaction involving an enhanced
payment card account;

formulating, by the fraud scoring platform, a recommended
decision score based on the purchase transaction information
and purchase history data associated with the enhanced
payment card account;

determining, by the fraud scoring platform, that the
recommended decision score is below a risk threshold;

transmitting, by the fraud scoring platform to the payment
network based on the recommended decision score, a
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purchase transaction authorization message overruling the
decline decision received from the issuer FI computer;

receiving, by the fraud scoring platform from one of the payment
network or the issuer FI computer, a fraud message indicating
that the authorized purchase transaction involving the
enhanced payment card account is fraudulent; and

transmitting, by the fraud scoring platform via the payment
network and the issuer financial institution to a clearing and
settlement system, instructions to transfer a monetary amount
from a fraud expense pool to the issuer FI computer to
reimburse costs associated with the fraudulent purchase
transaction identified by the fraud message, wherein the fraud
expense pool is funded by a portion of card products and
services fees charged to issuer FIs that issue enhanced
payment card accounts.
16. An enhanced payment card account method comprising:
receiving, by a fraud scoring platform, purchase transaction
information and an associated decline decision from an issuer
financial institution (FI) computer for a purchase transaction
involving an enhanced payment card account;

formulating, by the fraud scoring platform, a recommended
decision score based on the purchase transaction information
and purchase history data associated with the enhanced
payment card account;

transmitting, by the fraud scoring platform, at least one of the
recommended decision score and raw data associated with the
enhanced payment card account to the issuer FI computer;

receiving, by the fraud scoring platform from the issuer FI
computer, a purchase transaction authorization message
associated with the purchase transaction involving the
enhanced payment card account overruling the decline
decision;

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receiving, by the fraud scoring platform from at least one of the
issuer FI computer and the payment network, a fraud message
indicating that the purchase transaction involving the
enhanced payment card account is fraudulent; and

transmitting, by the fraud scoring platform via the issuer
financial institution to a clearing and settlement system,
instructions to transferring a monetary amount from a fraud
expense pool to the issuer FI computer to reimburse costs
associated with the fraudulent purchase transaction identified
by the fraud message, wherein the fraud expense pool is
funded by a portion of card products and services fees charged
to issuer FIs that issue enhanced payment card accounts.
REFERENCES
The Examiner relies upon the following prior art:
Name Reference Date
Bodington US 2010/0211445 A1 Aug. 19, 2010
Clarke US 2015/0095215 A1 Apr. 2, 2015
Nighan US 2002/0046065 A1 Apr. 18, 2002
Langus US 2014/0244496 A1 Aug. 28, 2014
Hillmer US 2003/0069820 A1 Apr. 10, 2003

REJECTIONS
1. Claims 1–25 are rejected under 35 U.S.C. § 101. Final Act. 15–
42.
2. Claims 1 and 3–11 are rejected under 35 U.S.C. 103 over
Bodington, Clarke, and Nighan. Id. at 43–51.
3. Claim 2 is rejected under 35 U.S.C. 103 over Bodington,
Clarke, Nighan, and Langus. Id. at 52–53.
4. Claims 12 and 15 are rejected under 35 U.S.C. 103 over
Bodington, Clarke, and Nighan. Id. at 53–58.
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5. Claim 13 is rejected under 35 U.S.C. 103 over Bodington,
Clarke, Nighan, and Langus. Id. at 58–59.
6. Claim 14 is rejected under 35 U.S.C. 103 over Bodington,
Clarke, Nighan, and Hillmer. Id. at 59–61.
7. Claims 16–20 and 22 are rejected under 35 U.S.C. 103 over
Bodington, Clarke, and Nighan. Id. at 61–67.
8. Claim 21 is rejected under 35 U.S.C. 103 over Bodington,
Clarke, Nighan, and Hillmer. Id. at 67–69.
9. Claims 23 and 25 are rejected under 35 U.S.C. 103 over
Bodington, Clarke, and Nighan. Id. at 70–75.
10. Claim 24 is rejected under 35 U.S.C. 103 over Bodington,
Clarke, Nighan, and Hillmer. Id. at 75–76.
OPINION
I. SECTION 101 REJECTION
The Examiner rejects all of the pending claims under 35 U.S.C. § 101
as patent ineligible because they are directed to at least one judicial
exception without additional elements that amount to significantly more.
Final Act. 15–42; Ans. 3–10. Appellant argues that the claims are not
directed to an abstract idea because they: do not fall into any of the
groupings set forth in the 2019 Guidance and are therefore not abstract
ideas; integrate the exception into a practical application; the claims recite
significantly more than the abstract idea, and the Examiner’s rejection
should be reversed. Appeal Br. 19–25 (claims 1–15), 26–32 (claims 16–25);
Reply Br. 2–6. For the reasons explained below, we are not persuaded of
Examiner error in the § 101 rejection, and we, therefore, sustain that
rejection.
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A. PRINCIPLES OF LAW
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 U.S. Supreme Court, however, has 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, 573 U.S.
208, 216 (2014).
The Court, in Alice, reiterated the two-part framework previously set
forth in Mayo Collaborative Services v. Prometheus Laboratories, Inc.,
566 U.S. 66, 75–77 (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, 573 U.S. at 217. The first
part in the analysis is to “determine whether the claims at issue are directed
to one of those patent-ineligible concepts.” Id. For example, abstract ideas
include, but are not limited to, fundamental economic practices, methods of
organizing human activities, an idea of itself, and mathematical formulas or
relationships. Id. at 218–20. The “directed to” inquiry asks not whether
“the claims involve a patent-ineligible concept,” but instead whether,
“considered in light of the specification, . . . ‘their character as a whole is
directed to excluded subject matter.’” Enfish, LLC v. Microsoft Corp.,
822 F.3d 1327, 1335 (Fed. Cir. 2016). In that regard, we determine whether
the claims “focus on a specific means or method that improves the relevant
technology” or are “directed to a result or effect that itself is the abstract idea
and merely invoke generic processes and machinery.” McRO, Inc. v. Bandai
Namco Games Am. Inc., 837 F.3d 1299, 1314 (Fed. Cir. 2016).
If, in the first part of the Alice/Mayo analysis, we conclude that the
claims are not directed to a patent-ineligible concept, we consider them
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patent eligible under § 101 and our inquiry ends. Rapid Litig. Mgmt. Ltd. v.
CellzDirect, Inc., 827 F.3d 1042, 1047 (Fed. Cir. 2016).
If the claims are directed to a patent-ineligible concept, the second
part in the Alice/Mayo analysis is to consider the elements of the claims
“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.” Alice, 573 U.S. at 217 (quoting Mayo, 566 U.S.
at 79, 78). In other words, the second part is to “search for an ‘inventive
concept’—i.e., 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.’” Id. at 217–18 (alteration in original)
(internal citation marks omitted) (quoting Mayo, 566 U.S. at 72–73). The
prohibition against patenting an abstract idea “‘cannot be circumvented by
attempting to limit the use of the formula to a particular technological
environment’ or adding ‘insignificant post solution activity.’” Bilski v.
Kappos, 561 U.S. 593, 610–11 (2010).
The U.S. Patent and Trademark Office (the “Office”) has published
revised guidance on the application of 35 U.S.C. § 101. 2019 Revised
Patent Subject Matter Eligibility Guidance, 84 Fed. Reg. 50–57 (Jan. 7,
2019) (“2019 Guidance”). Under the 2019 Guidance, the Office first looks
to whether the claim recites: (1) 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,
including advertising and marketing, or mental processes); and (2) additional
elements that integrate the judicial exception into a practical application.
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See 2019 Guidance, 84 Fed. Reg. at 52, 54–55; see also MPEP
§§ 2106.05(a)–(c), (e)–(h).3
Only if a claim (1) recites a judicial exception, and (2) does not
integrate that exception into a practical application, does the Office then
look to whether the claim: (a) adds a specific limitation beyond the judicial
exception that are not “well-understood, routine, conventional” in the field
(see MPEP § 2106.05(d)); or (b) simply appends well-understood, routine,
conventional activities previously known to the industry, specified at a high
level of generality, to the judicial exception. See 2019 Guidance, 84 Fed.
Reg. at 56. We follow this guidance here.4
In reviewing the Examiner’s rejection under § 101, we group all the
claims together and select claims 1 and 16 as representative. See 37 C.F.R.
§ 31.47(c)(1)(iv); Appeal Br. 18 (claims 1–15 and 16–25 “stand or fall
together”), 20 (claim 1 is representative of claims 1–15), 26 (claim 16 is
representative of claims 16–25). Appellant contends that claims 1 and 16
are representative of claims 1–15 and 16–25 respectively, each being
directed to two different aspects of the “enhanced payment card account.”
Appeal Br. 18. Appellant does not explain or discuss the alleged “two
different aspects.” Most of claim 1’s limitations have corresponding

3 Unless otherwise specified herein, all references to the MPEP are to Rev.
08.2017 (Jan. 2018).
4 “All USPTO personnel are, as a matter of internal agency management,
expected to follow the guidance.” 2019 Guidance, 51; see also October
2019 Update: Subject Matter Eligibility, 1 (Oct. 17, 2019) (“October 2019
Update”) (“Note, the feedback received was primarily directed to
examination procedures and, accordingly, this update focuses on clarifying
practice for patent examiners. However, all USPTO personnel are expected
to follow the guidance.”), available at https://www.uspto.gov/sites/
default/files/documents/peg_oct_2019_update.pdf.
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limitations in claim 16. See CLAIMED SUBJECT MATTER above
(reproducing claims 1 and 16). The only exception we note is that claim 16
lacks the “determining” a decision score is “below a risk threshold” step of
claim 1. Accordingly, we use claim 1 as representative we refer to its claim
language in our analysis.
B. APPLICATION OF LEGAL PRINCIPLES
1. Step 2A of 2019 Guidance
Prong 1: Claims Recite an Abstract Idea
The Examiner finds that the abstract idea is described in the
Specification as “authoriz[ing] a transaction using a fraud risk indicator
score (see page 6 lines 6–18) and to reimburse a fraudulent transaction loss
using a fraud mitigation account.” Final Act. 16. The Examiner determines
that the claim 1 recitation “receiving transaction information and
formulating a recommended decision score with respect to risk and
transmitting an authorization message overruling an issuer decline,
receiving a message indicating fraud and transmitting the instructions to
reimburse a cost associated with a fraud transaction” is also directed to the
abstract idea. Id.; see also id. at 23 (“patent ineligible concept directed
toward fundamental economic practices and concepts directed toward
transaction authorization using risk mitigation processes.”).
Consistent with the Final Action, and applying the 2019 Guidance, the
Answer quotes portions of claim 1, including “determining . . . that the
recommended decision score is below a risk threshold . . . receiving . . . a
fraud message indicating that the authorized purchase transaction . . . is
fraudulent; . . . transmitting . . . instructions to transfer a monetary amount .
. . to reimburse cost associated with the fraudulent transaction identified by
the fraud message.” Ans. 3; see also Final Act. 16, 23 (cited in Appeal Br.
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18 n.57). According to the Examiner, the preceding recitations “clearly state
that the claimed subject matter is directed toward determining a threshold in
order to authorize and fund a transaction.” Id. at 3–4. The recitations are
determined to be a step that can be “performed in the mind” as a mental
process of an abstract idea. Id. at 4. The Examiner also identifies other
limitations of claim 1 that recite the abstract idea, including “transmitting an
authorization message overruling a decline decision, receiving a fraud
message . . . that the authorized purchase transaction . . . is fraudulent and
transmitting . . . instructions to transfer monetary value from . . . [fraud]
expense pool to . . . reimburse cost.” Id. at 4 (emphasis added).
We agree with the Examiner and determine the claim recitations of a
payment card account where purchase transaction information and purchase
history are used to overrule a decline determination and fund a transaction
and, if the transaction is fraudulent, to reimburse the issuer financial
institution (FI) recite steps that can be performed by a human by pen and
paper as mental processes. We also agree with the Examiner that the above
identified “overruling” and “fraud expense pool” limitations are part of the
abstract idea.
Appellant disputes that claims 1–15 recite an abstract idea and alleges
the claims are directed to “patent-eligible subject matter.” Appeal Br. 19.
Appellant contends that the “overruling” and “fraud expense pool”
recitations above, are not abstract. See id. at 20. We disagree.
The idea of “overruling a decline decision” is described as “overrule
the issuer’s own initial decline decision.” Spec., 25:6–11. Stated
differently, the authorization for a “purchase transaction” is changed from
decline to approve.
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Similarly, the fraud expense pool may be a general ledger and “may
include financial data associated with funds that have been allocated to the
benefits provider to cover costs, for example, of fraudulent activity and/or
benefits servicing and/or statement credits and/or benefits reimbursements
associated with enhanced payment card accounts.” Spec., 17:11–15. Thus,
the “fraud expense pool,” like a general ledger, tracks allocation of funds to
the issuer for potential reimbursement.
The 2019 Guidance requires us to identify at least one specific subject
matter grouping within which the abstract idea fits. 2019 Guidance, 84 Fed.
Reg. at 52. Appellant argues the preceding limitations of claim 1,
“overruling the decline decision” and a “fraud expense pool” to reimburse
costs to the issuing financial institution (FI) where the purchase transaction
is indeed fraudulent, are not abstract but are patent eligible because they do
not recite “a mathematical concept, certain methods of organizing human
activity, or mental processes.” Appeal Br. 20–21.
Prior to applying the 2019 Guidance, the Examiner determined that
the abstract idea was a “mitigation of risk in commerce” and thus “a
fundamental economic practice.” Final Act. 16, 23. Applying the 2019
Guidance, in the Answer the Examiner further determines the abstract idea is
a mental process in that the abstract idea “can be performed mentally and
adding additional computer elements does not move the claimed process[] in
the context of this claim beyond the user mentally/manually performing the
claimed process.” Ans. 5.
Appellant argues the organizing human activity grouping includes
“certain methods,” but not all methods. Reply Br. 2–3. Appellant concludes
“that this category description does not cover human operation of
machines.” Id. at 3. In a related argument, Appellant contends the claims
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recite “a fraud scoring platform that interacts with other hardware
components” and is not “human activity.” Id. at 4. Appellant cites
Intellectual Ventures I LLC v. Capital One Bank, 792 F.3d 1363 (Fed. Cir.
2015) as an example of “a concept relating to managing human behavior as
being abstract.” Id. Appellant argues that the Examiner has not “analogized
the claims at issue to other cases for guidance.” Id. We find these
arguments unpersuasive.
We disagree that “human operation of machines” or that interaction of
hardware components precludes a claim from reciting “organizing human
activity.” This argument lacks legal authority. Indeed, as discussed in
connection with Prong 2 below, simply using a computer to perform an
abstract idea is not an additional element integrated into a practical
application. 2019 Guidance, 55 n.30 (citing MPEP § 2106.05(f); Alice, 573
U.S. at 222–226). Intellectual Ventures is not relevant because it found the
claimed subject matter was an abstract idea. Contrary to Appellant’s
assertion, the Examiner cited case law for the determination that the abstract
idea is a “fundamental economic practice,” which, under the 2019 Guidance,
is one of certain methods of organizing human activity that have been
deemed abstract (see 2019 Guidance, 52). Final Act. 16–17 (citing Alice
(see id. 573 U.S. at 218–220) and Bilski).
We agree with the Examiner’s initial determination that the claims
recite a certain method of organizing human activity. In this case the 2019
Guidance includes, as the Examiner determined, “fundamental economic . . .
practices” including “insurance, mitigating risk.” 2019 Guidance, 84 Fed.
Reg. at 52; Ans. 16–17.
Appellant recognizes the Answer categorizes the claims as reciting
“mental processes” but argues such processes are “thus organizing human
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activity.” Reply Br. 2 (citing Ans. [4]). Further, Appellant argues that the
Examiner is “merely opining that claims 1–25 concern ‘mental concepts,’
and thus are within the realm of the ‘Certain Methods of Organizing Human
Activity’ group of abstract ideas is not enough, and thus the Office failed to
establish a prima facie case for rejecting the claims under Section 101.” Id.
at 3. This argument is not persuasive.
Appellant misapprehends the Examiner’s grouping because “mental
processes” are a separate grouping and not a subgroup of “certain methods
of organizing human activity.” See 2019 Guidance, 84 Fed. Reg. at 52. The
Examiner determines the claim recitations “can easily be performed
mentally and/or manually . . . with pen and paper.” Ans. 4. This is more
than merely opining that the claims recite a mental process. This
determination is supported by the Specification, which does not describe any
aspect of claim 1 which is anything other than a mental step. For example,
the recited “determining . . . the recommended decision score is below a risk
threshold” is described in the context of “a particular enhanced payment card
account cardholder” and “could also include various other and/or additional
risk factors that may increase or decrease the score.” Spec. 18:22–30.
We agree with the Examiner. The Specification describes how the
determination of “risk threshold” is done. The determination step could be
done by a person collecting the necessary information and calculating or
otherwise mentally determining a fraud score. Other recited steps are
likewise capable of being performed by a human. See Ans. 4 (listing other
claim 1 steps as “easily be performed mentally and/or manually . . . with
pen and paper.”).
We have also considered Appellant’s arguments regarding
representative claim 16. See Appeal Br. 26–29 (concerning Step 2A, Prong
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1). The Examiner determines, and we agree, the arguments made with
respect Prong 1 regarding claims 16–25 are repetitive of those made with
respect to claims 1–15. Ans. 7. As discussed above, there is all but
complete overlap between the limitations of claims 1 and 16. See Section
I.A above. For example, both include “overruling the decline decision” and
the “fraud expense pool” steps. See CLAIMED SUBJECT MATTER above
(reproducing claims 1 and 16).
Thus, under Prong 1 of Step 2A in accordance with the 2019
Guidance, we agree with the Examiner’s determination that the claims recite
a judicial exception to patentability, namely, “a method of organizing human
activity” and a “mental process.” The claim limitations reciting the step of
“overruling” a decision to decline or “a clearing and settlement system,”
including a “fraud expense pool,” etc., are recitations of the abstract idea.
We agree with the Examiner’s conclusion that the claims recite an abstract
idea. Accordingly, in Prong 1 of the first step of the Alice/Mayo analysis,
we conclude the claims recite an abstract idea.
Prong 2: Claims Integrate the Abstract
Idea Into a Practical Application5
In accordance with Prong 2 of Step 2A of the 2019 Guidance, we
evaluate the claims to determine whether they recite additional elements
beyond the abstract idea, and, if so, we evaluate the additional elements to
determine whether they integrate the abstract idea into a practical
application. 2019 Guidance, 84 Fed. Reg. at 54. The 2019 Guidance, at

5 We acknowledge that some of these considerations may be properly
evaluated under the second part of the Alice/Mayo analysis (Step 2B of the
2019 Guidance). For purposes of maintaining consistent treatment within
the Office, we evaluate them under the first part of the Alice/Mayo analysis
(Step 2A of the 2019 Guidance). See 2019 Guidance, 84 Fed. Reg. at 54–55.
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page 55, provides exemplary considerations, including whether an additional
element:
 “reflects an improvement in the functioning of a computer, or
an improvement to other technology or technical field”;
 “implements a judicial exception with, or uses a judicial
exception in conjunction with, a particular machine or
manufacture that is integral to the claim”;
 “effects a transformation or reduction of a particular article [or
thing] to a different state or thing”; or
 “applies or uses the judicial exception in some other meaningful
way beyond generally linking the use of the judicial exception
to a particular technological environment.”
The 2019 Guidance also highlights certain examples in which courts
have held that “a judicial exception has not been integrated into a practical
application,” such as where the claimed invention “merely uses a computer
as a tool to perform an abstract idea” or the additional element adds
“insignificant extra-solution activity” to the abstract idea. 2019 Guidance,
84 Fed. Reg. at 55 (emphasis added); see also October 2019 Update at 11–
15.
Appellant argues claims 1–15 “do not recite an abstract idea because
the claims recite additional elements that integrate the exception into a
practical application of that exception.” Appeal Br. 23 (emphasis omitted).
Appellant argues additional elements of claims 1 and 12 (a system claim
otherwise having limitations corresponding to claim 1’s steps):
recite an improvement to the functionality of a payment
authorization platform by requiring interactions between a fraud
scoring platform, a payment network, an issuer financial
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institution (FI) computer, and a clearing and settlement system
that interact in a manner to optimize authorization decisions for
enhanced payment card accountholders in a manner to minimize
inconvenience and/or embarrassment, while at the same time
providing a process, which protects issuer FIs by transferring
funds from a fraud expense pool to the issuer FI computer to
cover authorized purchase transactions that later proved to be
fraudulent.

Id. at 24; Reply Br. 5 (emphasis added). Appellant contends the above
recitations, which are illustrative of the relevant claim limitations,
“meaningfully limit the abstract idea.” Appeal Br. 24. These limitations are
argued by Appellant as resulting in a “novel enhanced payment card account
method and system.” Id. (referencing Section 103 rejections).
The Examiner contends the “improvement” is to “minimize
inconvenience and/or embarrassment while providing a process which
transfers funds from a fraud expense pool to the issuer to cover fraudulent
transactions.” Ans. 6. The Examiner determines the preceding is “‘not
directed to an improvement in the way computers operate’ and ‘the focus of
the claims is not on . . . an improvement in computers as tools, but on
certain independently abstract ideas that use computers as tools.’” Id. (citing
FairWarning IP, LLC v. Iatric Systems, Inc., 839 F.3d 1089, 1095 (Fed. Cir.
2016). Further, the Examiner points out that any arguably technological
element, like the “fraud scoring platform,” is a “generic element.” Id. at 7.
Appellant counters by arguing the process of claim 1 is “rooted in an
electronic environment embodied by hardware components.” Reply Br. 3.
Appellant points to the independent claims as requiring “a specific structure
paired with a prescribed functionality that is directly related to the structure,
and recite a method that resolves specifically identified problems.” Id. at 5.
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Further, it argues none of the hardware functions is performed by a general
purpose computer. Id. Appellant’s argument is not persuasive.
Other than by conclusory assertions set forth above, Appellant does
not show why any of the recited hardware components use either “an
improvement in the functioning of a computer, or an improvement to other
technology or technical field,” as set forth in the 2019 Guidance, or meet any
other consideration that might support a conclusion that the additional
elements integrate the abstract idea into a practical application. The only
arguable hardware components cited by Appellant are the “fraud scoring
platform,” “payment network,” “issuer financial institution (FI) computer,”
and “clearing and settlement system.” Appeal Br. 23–24; Reply Br. 5. But
none of these additional elements is described as improving computer
function or other technology.
For example, the “fraud scoring platform” is described functionally as
evaluating “transactions based on established spending patterns for each
primary account number (PAN) and then determines whether a particular
purchase transaction is likely legitimate or fraudulent.” Spec. 17:2–5. The
fraud scoring platform may make a decision based on limited data or with a
“fraud algorithm that is/are not utilized and/or not available to the issuer FI
computer.” Id. at 20:14–18. The fraud scoring platform is illustrated as a
box, without any additional detail. Id. at Figs. 3, 4. The fraud algorithm is
not disclosed.
The Specification does not disclose the fraud scoring platform as an
improvement to computer technology. No technology is discussed in
describing it or any of the other arguable hardware limitations claimed.
Neither does Appellant identify any problem particular to computer
technology that claim 1’s hardware components solve. See, e.g., DDR
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Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245, 1258 (Fed. Cir. 2014)
(graphical user interface did not overcome any problem). Indeed, the
alleged improvement of minimizing inconvenience and/or embarrassment
associated with declining a credit card transaction is not a technological one.
See Appeal Br. 24; Reply Br. 5.
Further, “transmitting by the fraud scoring platform . . . instructions to
transfer a monetary amount from a fraud expense pool to the issuer FI
computer to reimburse costs associated with the fraudulent purchase
transaction” of claim 1 occurs after the transaction is confirmed as
fraudulent. Reimbursement for the loss already incurred by erroneously
authorizing the purchase transaction is a follow-up to the fraudulent
purchase having been authorized. As such, this “additional element adds
insignificant extra-solution activity to the judicial exception.” 2019
Guidance, 55.
Appellant makes substantially the same arguments for claims 1 and
16. We conclude, for the reasons outlined above, claims 1 and 16 recite a
method of organizing human activity, a fundamental economic practice, and
mental process that a human can perform under the 2019 Guidance, i.e., an
abstract idea, and that the additional elements recited in the claim are no
more than generic components used as tools to perform the recited abstract
idea. As such, they do not integrate the abstract idea into a practical
application. See Alice, 573 U.S. at 223–24 (“[W]holly generic computer
implementation is not generally the sort of ‘additional featur[e]’ that
provides any ‘practical assurance that the process is more than a drafting
effort designed to monopolize the [abstract idea] itself.’”) (second and third
alterations in original) (quoting Mayo, 566 U.S. at 77). Accordingly, in the
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first part of the Alice/Mayo analysis, we conclude claims 1 and 16 are
directed to an abstract idea.
2. Step 2B of 2019 Guidance
Because we determine that the claims are directed to an abstract idea,
and do not recite additional limitations that integrate the abstract idea into a
practical application, we next consider whether the claims contain any
“inventive concept” or adds anything “significantly more” to transform the
abstract concept into a patent-eligible application. Alice, 573 U.S. at 216.
As recognized by the Revised Guidance, an “inventive concept” under Alice
step 2 can be evaluated based on whether an additional element or
combination of elements:
(1) adds a specific limitation or combination of limitations that are
not well-understood, routine, conventional activity in the field,
which is indicative that an inventive concept may be present; or
(2) simply appends well-understood, routine, conventional
activities previously known to the industry, specified at a high
level of generality, to the judicial exception, which is indicative
that an inventive concept may not be present.

See 2019 Guidance, 84 Fed. Reg. at 56; see also MPEP § 2106.05(d).
The Final Action determines that:
the claims recite at a high level generic functions such as
receiving, formulating decision, determine a score threshold,
transmitting an authorization message, receiving a fraud message
and transmitting to fund a reimbursement cost which are
processes capable of being performed mentally or implemented
conventionally to perform the abstract idea.

Final Act. 18. The Examiner specifically determines the:
[fraud] scoring platform [is] recited at a high level of generality
to simply perform generic computer functions such as receiving
data, formulating a score, determining the score below a
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threshold, transmitting an authorization based on the score, and
receiving the authorization and transmitting funds in order to
implement the abstract identified idea.

Id. The Examiner cites the Specification as demonstrating:
the well-understood, routine, conventional nature of additional
elements when it describes the additional elements as well-
understood or routine or conventional (or an equivalent term), as
a commercially available product, or in a manner that indicates
that the additional elements are sufficiently well-known that the
specification does not need to describe the particulars of such
additional elements to satisfy 35 U.S.C. § 112(a).

Id. at 19.
Appellant’s response is all but identical to its allegations regarding
integration into a practical application. Appeal Br. 25. As was alleged in
the practical application argument, Appellant, using language from the
second step of Alice, alleges that “claims 1 and 12 provide meaningful
limitations that add more than generally linking use of an abstract idea to
generic computing devices.” Id.
In addition, Appellant argues the claims “include limitations other
than what is well-understood, routine and conventional in the field, by
requiring interaction between a fraud scoring platform, a payment network,
an issuer financial institution (FI) computer.” Appeal Br. 25 (emphasis
added). The same emphasized limitations were argued in connection with
integration into a practical application argument. Compare Appeal Br. 24
with id. at 25. The adoption of relevant language from Alice, without further
explanation, is not persuasive. For the reasons discussed above in
connection with integration into a practical application, we determine that
the elements Appellant cites, when considered individually and as an
ordered combination, do not recite significantly more than the abstract idea
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beyond generally linking the abstract idea to a generic technological
environment.
Neither the “overruling” step nor the “fraud expense pool” step “focus
on a specific means or method that improves the relevant technology” and
are instead “directed to a result or effect that itself is the abstract idea.”
McRO, Inc., 837 F.3d at 1314. Both limitations recite parts of the abstract
idea when considered “individually and ‘as an ordered combination’” and
are not described in the Specification as additional elements that “‘transform
the nature of the claim’ into a patent-eligible application.” Alice, 573 U.S. at
217.
Accordingly, we sustain the Examiner’s rejection of claim 1 under 35
U.S.C. § 101 as patent-ineligible. We also sustain the rejection of claim 16,
which is argued on all but identical reasons. We also sustain the rejection of
claims 2–15 and 17–25, which are not separately argued and, per Appellant,
“stand and fall together” with claims 1 and 16. See Appeal Br. 18.
II. SECTION 103 REJECTIONS
We have reviewed the Examiner’s rejections of claims 1–25 under 35
U.S.C. § 103 in light of Appellant’s arguments the Examiner has erred. We
disagree with Appellant’s arguments and we adopt as our own the findings
and reasons set forth by the Examiner in the Final Action from which this
appeal is taken and the reasons set forth by the Examiner in the Examiner’s
Answer in response to Appellant’s Appeal Brief. We concur with the
conclusions reached by the Examiner, and we highlight the following for
emphasis.

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A. REJECTIONS 2 and 46 (Rejecting claims 1, 3–11, 12 and 15 over
Bodington, Clarke, and Nighan)

Appellant states that claims 1, 3–11, 12, and 15 “stand or fall
together.” Appeal Br. 34. Appellant’s arguments are limited to
representative claim 1. Id. at 34–39.
Appellant first argues the references do not teach the recited “payment
network” or an “associated decline decision.” Appeal Br. 35. Appellant
alleges Bodington “describes a method wherein an accountholder 102 may
create a routing rule for declining particular transactions.” Id. According to
Appellant, the authorization process of Bodington is “distinctly different
from a fraud scoring platform receiving purchase transaction information
and an associated decline decision generated by an issuer financial
institution (FI) computer from a payment network for a purchase transaction
involving an enhanced payment card account, as claimed.” Id. at 36.
In response to Appellant’s assertion that Bodington does not teach a
“payment network” and is “distinctly different” from the recited invention,
the Examiner notes that Bodington specifically references “payment
networks” including MasterCard, the real party in interest here. Ans. 11
(citing Bodington ¶ 24). The Examiner also cites Bodington’s “account
features” as including “fraud features” to teach the payment network and
fraud considerations in making a decision to decline authorization. Id. at
11–12 (quoting Bodington ¶ 59); see also Final Act. 44 (citing Bodington,
Fig. 6A, ¶¶ 59, 111, 113 (“communicating risk score”), 143–144 (“a risk
algorithm that calculates a risk value (e.g., a risk score)”). Appellant’s
Reply Brief does not provide any additional argument as to what is present

6 Reference numbers are to rejections in REJECTIONS above.
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in its Appeal Brief in response to the Examiner’s Answer. See Reply Br. 6–
7.7 We agree with the Examiner’s reasoning set forth above that Bodington
shows a “payment network.” Final Act. 44 (citing inter alia Bodington Fig.
6A (selectable features of a debit account)).
Appellant acknowledges different routing rules of Bodington may
result in the issuer declining an authorization requests for that debit account
“if a condition of the routing rule is satisfied.” Appeal Br. 35–36 (citing
Bodington ¶¶ 66, 77); see also Final Act. 44–45 (Examiner’s citation to
Bodington ¶¶ 66, 77 as part of evidence showing recitations to “fraud
scoring platform,” “payment network,” “authorization”). Appellant and the
Examiner both cite to paragraphs 66 and 77 of Bodington as teaching
declining authorization requests. Appeal Br. 35–36 (citing Bodington ¶¶ 66,
77); see also Final Act. 44–45 (Examiner’s citation to Bodington ¶¶ 66, 77).
For these reasons, we are persuaded Bodington teaches a “decline decision.”
Appellant argues Clarke does not teach “overruling the decline
decision received from the issuer FI computer.” Appeal Br. 37. Appellant
argues Clarke teaches “rescuing transactions that do not include an issuer FI
computer.” Appeal Br. 37 (citing Final Act. 45–46 (citing Clarke Figs. 1, 2,
¶¶ 35, 45, 54, 62)). Appellant argues the paragraphs of Clarke cited by the
Examiner do not relate to “overruling a decline decision” of the “issuer FI
computer” because the “transactions which were declined, canceled or

7 Appellant refers to certain disclosures of Clarke which are not relied on by
the Examiner for the recited “decline decision.” See Reply Br. 7–8 (arguing
Clarke’s “credit limits” and “merchant banks” as different from the “decline
decision as claimed”); see also Final Act. 44 (citing Bodington for the
“decline decision”), 45–46 (Bodington does not teach “overruling the
decline decision received from the issuer FI computer” and relying on
Clarke). The “overruling” limitation is addressed below.
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suspended by the merchant,” and “the merchant can initiate or not initiate a
rescue process,” not the issuer FI computer. Id. The Examiner asserts a
“merchant can also be an issuer” in that it can “reject” the transaction
authorized by a FI such as taught by Bodington. Ans. 14–15 (citing
Bodington ¶¶ 6, 27 (“gift cards”); Clarke, Fig. 1). The Examiner avers that
gift cards are issued by merchants and in that instance acts as an issuer. Id.
Appellant argues Clarke’s “credit limits” and “merchant banks” are different
from the claim recitations. Reply Br. 7–8; see Clarke ¶¶ 5 (“The system or
method can receive from the merchant (e.g., via the merchant’s system)
data”), 37 (“the charge amount to be reserved/held from the credit limit
associated with the electronic payment method”) (emphasis added).
Appellant’s arguments are not persuasive. Bodington, not Clarke, is
cited for the FI limitation. See Final Act. 44. “[O]ne cannot show non-
obviousness by attacking references individually where, as here, the
rejections are based on combinations of references.” In re Keller, 642 F.2d
413, 426 (CCPA 1981). Further, the Specification explains “in some
implementations the issuer FI may provide additional benefits . . . which are
funded by the issuer FI or other third parties, i.e., merchants or
manufacturers.” Spec. 13:21–24 (emphasis added). Thus, as the Examiner
determined, a merchant can be an issuer. See Ans. 14–15.
The Examiner relies on Nighan to teach “wherein the fraud expense
pool is funded by a portion of card products and services fees charged to
issuer FIs that issue enhanced payment card accounts.” Final Act. 46–47
(citing Nighan, Figs. 3–4, ¶¶ 8, 14, 31, 34–37, 47 (“premium for the master
policy as a benefit to the customer”), id. (citing Nighan ¶ 36 (“a master
policy approach, covering all remote banking customers against loss
resulting from unauthorized transactions”). Appellant argues Nighan
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provides insurance to a consumer, and not to the “issuer FI computer.”
Appeal Br. 38–39. The Examiner responds that Nighan insures, for
example, “loss incurred in connection with an online financial transaction.”
Ans. 16 (quoting Nighan ¶ 14), id. at 16–17 (citing Nighan ¶¶ 14, 31, 34–
37). Appellant does not respond to this showing. See generally Reply Br.
6–8. We are not persuaded by Appellant’s argument.
Claim 1 broadly specifies that the FI computer, as taught by
Bodington, is to “reimburse costs associated with the fraudulent purchase
transaction.” The “purchase transaction” to be reimbursed can be related to
a consumer. See Spec. 17:22–29 (“enhanced payment card account . . .
provide enhanced benefits provisioning to a consumer’s enhanced payment
card account, and to facilitate clearing and settlement between one or more
financial institutions (such as acquirer banks and issuer banks)”).
B. REJECTIONS 3 and 5 (Rejecting claims 2 and 13 over Bodington,
Clarke, Nighan, and Langus)

Claim 2 is taken as exemplary of claims 2 and 13, which “stand and
fall together.” Appeal Br. 39. Claim 2 depends from claim 1 and recites
“further comprises transmitting, by the fraud scoring platform, a copy of the
purchase transaction authorization message via the payment network to the
issuer FI computer to notify the issuer FI of the decision to overrule the
decline decision.”
The Examiner relies on Langus for the limitation recited in claim 2.
Final Act. 52–52 (citing Langus, Fig. 7, ¶¶ 45–49); Ans. 18 (quoting Langus
¶ 46). Appellant argues nothing cited by the Examiner in Langus suggests
the subject matter, including the “transmitting . . . the transaction
authorization message,” of claim 2. Appeal Br. 40. Appellant argues
“paragraphs 0045–0049 disclose a mobile companion prepaid card clearing
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process, a cardholder dispute process, a companion prepaid card settlement
process, a payment card system, and a mobile companion prepaid card
mobile-centric SMS confirmation process, respectively.” Id. Appellant
does not respond to the quotation from paragraph 46 of Langus quoted in the
Answer. See generally Reply Br. 6–8. We are not persuaded by Appellant’s
argument.
None of the differences cited by Appellant are distinguishable from
the broadest reasonable interpretations of the recitations of claim 2. As part
of the cardholder dispute process for receiving a “charge-back” for a
disputed transaction, paragraph 46 of Langus teaches the merchant
“transmits the documentary evidence (such as a copy of the sales receipt) to
the Acquirer 808, which is propagated through the payment card system
806.” Emphasis added. We are not persuaded that transmitting the
“documentary evidence” of paragraph 46 is patentably distinct from the
recited “transmitting . . . the purchase transaction authorization message.”
Appellant does not argue, and has not otherwise shown, that transmitting a
document as part of a dispute process is different from transmitting the
“purchase authorization message” in connection with reimbursement for a
“fraudulent purchase transaction.” The documentation of Langus is also
“propagated through the payment card system,” which we find is “via the
payment network.”
C. REJECTION 6 (Rejecting claim 14 over Bodington, Clarke,
Nighan, and Hillmer)

Claim 14 depends from claim 12 and further recites “determine that
the recommended decision score is above the risk threshold, and then to
transmit a purchase transaction decline message to the payment network on
behalf of the issuer FI computer.” The Examiner determines that Hillmer
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teaches determining whether a decision score is above a threshold. Final
Act. 60 (citing Hillmer, Abstract, ¶¶ 41, 44, 8–9, 31–32, 47–48, 58); Ans. 19
(citing Hillmer ¶¶ 47, 39, 146). Appellant argues “the cited portions of
Hillmer do not even suggest transmitting a purchase transaction decline
message to the payment network on behalf of the issuer FI computer, as
claimed.” Appeal Br. 40. We are not persuaded by Appellant’s argument.
The portions of Hillmer cited by the Examiner include a “total fraud
score” which is “compared with a fraud score threshold.” Hillmer ¶ 47
(emphasis added). Hillmer also teaches a “determination that the account
has sufficient funds to cover payment for the resources being purchased or
that the transaction has a low risk of fraud.” Id. ¶ 39. As recognized in the
Specification, a sufficient funds determination is a risk threshold
determination resulting in reimbursement. Spec. 27:14:20. As far as a
“purchase decline message,” Hillmer teaches an “authorization response
[which] may include an authorization of the payment transaction or a decline
to authorize the payment transaction.” Hillmer ¶ 39. Appellant’s argument
merely denies the teachings of Hillmer, but also agrees that Hillmer teaches
“the transaction is indicated to be potentially fraudulent if the fraud score
exceeds a first pre-determined threshold.” Appeal Br. 41 (citing Hillmer ¶¶
8–9) (emphasis added).
D. REJECTIONS 7 and 9 (Rejecting claims 16–20, 22, 23, and 25
over Bodington, Clarke, and Nighan)

Claim 16 recites substantially the same subject matter as recited in
claim 1. Appellant makes the same arguments it made in connection with
claim 1 in Section A above. Appeal Br. 41–47; see also Ans. 20–22 (“See
response above,” referencing arguments previously made arguments). We
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refer to our analysis above in Section A in response to these arguments.
Appellant’s arguments remain unpersuasive.
Claims 17–20, 22, 23, and 25 are not separately argued. See generally
Appeal Br. 41–47. Any arguments that could have been made relating to
their separate patentability are therefore waived. See 37 C.F.R. §
41.37(c)(iv).
E. REJECTIONS 8 and 10 (Rejecting claims 21 and 24 over
Bodington, Clarke, Nighan, and Hillmer)

With respect to claims 21 and 24, Appellant makes the same
arguments it made in connection with claims 2 and 13 in Section B above.
Appeal Br. 47–48. Other than dependency relationships, claims 2, 13, 21,
and 24 all recite all but identical subject matter. We refer to our analysis
above in Section B and our analysis of claim 2 in response to these
arguments. Appellant’s arguments remain unpersuasive.
CONCLUSION
The Examiner’s decision rejecting claims 1–5 under 35 U.S.C. § 101
as being directed to patent-ineligible subject matter is affirmed.
The Examiner’s decision rejecting claims 1–25 as being unpatentable
under 35 U.S.C. § 103 is affirmed.
DECISION SUMMARY
In summary:
Claims
Rejected
35
U.S.C.
§
Reference(s)/Basis Affirmed Reversed
1–25 101 Eligibility 1–25
1, 3–11

103 Bodington, Clark,
Nighan
1, 3–11

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2 103 Bodington, Clarke,
Nighan, Langus
2
12, 15 103 Bodington, Clarke,
Nighan
12, 15
13 103 Bodington, Clarke,
Nighan, Langus
13
14 103 Bodington, Clarke,
Nighan, Hillmer
14
16–20, 22 103 Bodington, Clarke,
Nighan
16–20, 22
21 103 Bodington, Clarke,
Nighan, Hillmer
21
23, 25 103 Bodington, Clarke,
Nighan
23, 25
24 103 Bodington, Clarke,
Nighan, Hillmer
24
Overall
Outcome
1–25

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