Square, Inc.

Patent Trials and Appeals Board

Sep 11, 2020

14615257 - (D) (P.T.A.B. Sep. 11, 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.
14/615,257 02/05/2015 Jack Dorsey 085091-518218_SQ-39-
US1C1
7799
118755 7590 09/11/2020
Polsinelli PC - Square
c/o Polsinelli PC
1401 Eye ("I") Street, N.W., Suite 800
Washington, DC 20005
EXAMINER
SUBRAMANIAN, NARAYANSWAMY
ART UNIT PAPER NUMBER
3695
NOTIFICATION DATE DELIVERY MODE
09/11/2020 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):
patentdocketing@polsinelli.com
square@polsinelli.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte JACK DORSEY
Appeal 2020-000810
Application 14/615,257
Technology Center 3600
Before MICHAEL R. ZECHER, CATHERINE SHIANG, and BETH Z.
SHAW, Administrative Patent Judges.
SHAW, Administrative Patent Judge.
DECISION ON APPEAL

Pursuant to 35 U.S.C. § 134(a), Appellant1 appeals from the
Examiner’s decision to reject claims 1–18 and 21–23. See Non-Final Act. 1.2
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. Appellant identifies the real party in interest as Square, Inc. Appeal
Br. 3.
2 All references to the Non-Final Action under appeal refer to the Non-Final
Action entered on March 6, 2019.
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CLAIMED SUBJECT MATTER
The claims are directed to a method of generating a dynamic receipt.
Claim 11, reproduced below, is illustrative of the claimed subject matter:
11. A method of generating a dynamic receipt, the method
comprising:
acquiring financial transaction information about a financial
transaction using a mobile device;
acquiring, by the mobile device, payment card information from
a card reader coupled to the mobile device, the card reader configured
to read the payment card information from the payment card, the
payment card information to be used to process the financial
transaction;
sending, by the mobile device, the financial transaction
information and the payment card information, to an acquiring
institution server to process the transaction;
generating a dynamic receipt for the buyer that includes a
transaction result received from the acquiring institution server, and a
link to a data item that is provided by a server when the receipt is
viewed and the transaction result are included in the dynamic receipt;
receiving a request to display the dynamic receipt;
in response to receiving the request to display the dynamic
receipt, request the data item from the server using the link; and
displaying the dynamic receipt by the mobile device, wherein
the mobile device presents the transaction result and the data item
provided by the server when the receipt is viewed from the link.
Appeal Br. 17 (Claims Appendix).
REJECTION
Claims 1–18 and 21–23 are rejected under 35 U.S.C. § 101. Non-Final
Act. 2–5.

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OPINION
PRINCIPLES OF LAW
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 U.S. 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. Pty. Ltd. v. CLS Bank
Int’l, 573 U.S. 208, 216 (2014).
In determining whether a claim falls within an excluded category, we
are guided by the Court’s two-part framework, described in Mayo and Alice.
Id. 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.”); 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);
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 rubber products” (Diamond v. Diehr, 450 U.S. 175, 191
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(1981)); “tanning, dyeing, making waterproof cloth, vulcanizing India
rubber, smelting ores” (id. at 182 n.7 (quoting Corning v. Burden, 56 U.S.
252, 267–68 (1853))); 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
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; see also id. at 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 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. (citation omitted)
(citing Benson and Flook); see, e.g., 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.”).
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
concept’ sufficient to ‘transform’ the claimed abstract idea into a patent-
eligible application.” Alice, 573 U.S. at 221 (quotation marks omitted).
“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,
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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
In January 2019, the U.S. Patent and Trademark Office (USPTO)
published revised guidance on the application of § 101. 2019 Revised Patent
Subject Matter Eligibility Guidance, 84 Fed. Reg. 50 (Jan. 7, 2019)
(“2019 Revised Guidance”).3 “All USPTO personnel are, as a matter of
internal agency management, expected to follow the guidance.” Id. at 51; see
also October 2019 Update at 1.
Under the 2019 Revised Guidance and the October 2019 Update, we
first look 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 a fundamental economic practice, or mental
processes) (“Step 2A, Prong One”); and
(2) additional elements that integrate the judicial exception into a
practical application (see Manual of Patent Examining Procedure
(MPEP) § 2106.05(a)–(c), (e)–(h) (9th ed. Rev. 08.2017, Jan. 2018))
(“Step 2A, Prong Two”).4

3 In response to received public comments, the Office issued further
guidance on October 17, 2019, clarifying the 2019 Revised Guidance.
USPTO, October 2019 Update: Subject Matter Eligibility (the “October
2019 Update”) (available at
https://www.uspto.gov/sites/default/files/documents/peg_oct_2019_update.p
df).
4 This evaluation is performed by (a) identifying whether there are any
additional elements recited in the claim beyond the judicial exception, and
(b) evaluating those additional elements individually and in combination to
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2019 Revised Guidance, 84 Fed. Reg. at 52–55.
Only if a claim (1) recites a judicial exception and (2) does not
integrate that exception into a practical application, do we then look, under
Step 2B, 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
(4) simply appends well-understood, routine, conventional activities
previously known to the industry, specified at a high level of
generality, to the judicial exception.
2019 Revised Guidance, 84 Fed. Reg. at 52–56.

Abstract Idea
For the following reasons, we conclude the claims recite a
fundamental economic practice, which is one of certain methods of
organizing human activity identified in the Revised Guidance, and thus, an
abstract idea. See Revised Guidance, 84 Fed. Reg. at 52, 53 (listing
“[c]ertain methods of organizing human activity—fundamental economic
principles or practices” as one of the “enumerated groupings of abstract
ideas”).
Appellant addresses the claims as a group (see Appeal Br. 7–13) and,
as a result, we treat claim 11 as representative. The claim is directed to an
abstract idea because it is directed to a fundamental economic practice,

determine whether the claim as a whole integrates the exception into a
practical application. See 2019 Revised Guidance - Section III(A)(2), 84
Fed. Reg. 54–55.
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which is one of certain methods of organizing human activity, as discussed
below. The steps of claim 11, include the following, with italics added:
acquiring financial transaction information about a financial
transaction using a mobile device;
acquiring, by the mobile device, payment card information from
a card reader coupled to the mobile device, the card reader configured
to read the payment card information from the payment card, the
payment card information to be used to process the financial
transaction;
sending, by the mobile device, the financial transaction
information and the payment card information, to an acquiring
institution server to process the transaction;
generating a dynamic receipt for the buyer that includes a
transaction result received from the acquiring institution server, and a
link to a data item that is provided by a server when the receipt is
viewed and the transaction result are included in the dynamic receipt;
receiving a request to display the dynamic receipt;
in response to receiving the request to display the dynamic
receipt, request the data item from the server using the link; and
displaying the dynamic receipt by the mobile device, wherein
the mobile device presents the transaction result and the data item
provided by the server when the receipt is viewed from the link.

Appellant’s claimed invention is directed to generating a receipt for a
transaction, the receipt including a link to a data item provided by a server.
Under Supreme Court precedent, claims directed purely to an abstract
idea are patent ineligible. As set forth in the Revised Guidance, which
extracts and synthesizes key concepts identified by the courts, abstract ideas
include (1) mathematical concepts, (2) certain methods of organizing human
activity, and (3) mental processes. Among those certain methods of
organizing human activity listed in the Revised Guidance are fundamental
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economic practices, such as the concept of intermediated settlement in Alice,
and the concept of hedging in Bilski. Like those concepts, claim 11 also
recites a fundamental economic practice.
Specifically, the italicized steps fall under the umbrella of economic
practices, because the steps, including at least “acquiring financial
transaction information about a financial transaction,” “acquiring, …
payment card information . . . , the payment card information to be used to
process the financial transaction,” “sending, . . . the financial transaction
information and the payment card information,” “generating a dynamic
receipt for the buyer that includes a transaction result received . . . and a
link to a data item that is provided . . . when the receipt is viewed and the
transaction result are included in the dynamic receipt,” “receiving a request
to display the dynamic receipt,” and “in response to receiving the request to
display the dynamic receipt, request the data item” would ordinarily take
place in generating receipts, which occurs in our system of commerce. See
Spec. ¶ 3 (discussing cards used in “everyday commerce”).
In Intellectual Ventures I LLC v. Capital One Bank (USA), 792 F.3d
1363, 1369 (Fed. Cir. 2015), an advertisement taking into account the time
of day and tailoring the information presented to the user based on that
information was considered another “fundamental . . . practice long
prevalent in our system.” Similarly, in Credit Acceptance Corporation v.
Westlake Services, 859 F.3d 1044 (Fed. Cir. 2017), patent claims directed to
a system and method for providing financing to allow a customer to
purchase a product selected from an inventory of products maintained by a
dealer were considered patent ineligible as directed to the abstract idea of
processing an application for financing a purchase, an economic practice
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long prevalent in commerce. Like the claims at issue in Intellectual Ventures
I and Credit Acceptance, the claimed generation of a dynamic receipt based
on purchase transactions is “a fundamental economic practice long prevalent
in our system of commerce.” Credit Acceptance, 859 F.3d at 1054. Thus, we
conclude claim 11 recites a fundamental economic practice, which is one of
certain methods of organizing human activity identified in the Revised
Guidance, and thus an abstract idea.
In accordance with the Revised Guidance, and looking to MPEP
§§ 2106.05(a)–(c) and (e)–(h), we determine that claim 11 does not integrate
a judicial exception, in this case the abstract idea of a fundamental economic
practice, into a practical application.
In addition to the steps discussed above, claim 11 recites “a mobile
device,” “a card reader,” “an acquiring institution server,” and “a server.”
The recited mobile device, card reader, acquiring institution server, and
server are generic components. See, e.g., Spec. ¶¶ 27, 30 (“mobile device
100 . . . can be, but is not limited to, a cell phone . . . that is capable of . . .
exchanging information with a transaction server to verify the buyer and/or
seller’s account information, conducting the transaction, and generating a
receipt”), 31, Fig. 1. See 2019 Eligibility Guidance, 84 Fed. Reg. at 55
(identifying “merely includ[ing] instructions to implement an abstract idea
on a computer” as an example of when an abstract idea has not been
integrated into a practical application).
This is not a case involving eligible subject matter as in DDR
Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245 (Fed. Cir. 2014) despite
Appellant’s arguments to the contrary (App. Br. 11). There, instead of a
computer network operating in its normal, expected manner by sending a
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website visitor to a third-party website apparently connected with a clicked
advertisement, the claimed invention in DDR generated and directed the
visitor to a hybrid page that presented (1) product information from the third
party, and (2) visual “look and feel” elements from the host website. DDR,
773 F.3d at 1258–59. Given this particular Internet-based solution, the U.S.
Court of Appeals for the Federal Circuit held that the claimed invention did
not merely use the Internet to perform a business practice known from the
pre-Internet world, but rather was necessarily rooted in computer technology
to overcome a problem specifically arising in computer networks. Id. at
1257.
That is not the case here. As noted previously, Appellant’s claimed
invention, in essence, is directed to generating a receipt for a transaction, the
receipt including a link to a data item provided by a server—albeit using
computer-based components to achieve that end. The claimed invention here
is not necessarily rooted in computer technology in the sense contemplated
by DDR where the claimed invention solved a challenge particular to the
Internet. Although Appellant’s invention uses various computer-based
components noted previously, the claimed invention does not solve a
challenge particular to the computing components used to implement this
functionality.
Accordingly, the claim, as a whol,e does not integrate the abstract idea
into a practical application because the claim limitations, taken individually
or together, do not impose any meaningful limits on practicing the abstract
idea. Stated differently, the claims do not (1) improve the functioning of a
computer or other technology, (2) are not applied with any particular
machine (except for generic computer components), (3) do not effect a
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transformation of a particular article to a different state, and (4) are not
applied in any meaningful way beyond generally linking the use of the
judicial exception to a particular technological environment, such that the
claim, as a whole, is more than a drafting effort designed to monopolize the
exception. See MPEP §§ 2106.05(a)–(c), (e)–(h).
Inventive Concept
Because we determine that claim 11 is “directed to” an abstract idea,
we next consider whether claim 11 recites an “inventive concept.” The
Examiner determined that claim 11 does not recite an inventive concept
because the additional elements in the claim do not amount to “significantly
more” than the abstract idea itself. See Ans. 6–8.
We agree with the Examiner’s determination in this regard. Id. Using
generic computer components to perform abstract ideas does not provide the
necessary inventive concept. See Alice, 573 U.S. at 223 (“[T]he mere
recitation of a generic computer cannot transform a patent-ineligible abstract
idea into a patent-eligible invention.”). Thus, the elements of claim 11 do not
amount to “significantly more” than the abstract idea itself.
Preemption is a driving concern when determining patent eligibility.
See Alice, 573 U.S. at 216–17. Patent law cannot inhibit further discovery by
improperly tying up the future use of the building blocks of human
ingenuity. See id. (citing Mayo, 566 U.S. at 85–86). Although preemption is
characterized as a driving concern for patent eligibility, preemption itself is
not the test for patent eligibility. “Where 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 Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, 1379
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(Fed. Cir. 2015). “While preemption may signal patent ineligible subject
matter, the absence of complete preemption does not demonstrate patent
eligibility.” Id.
To the extent Appellant contends that the recited limitations, including
those detailed above in connection with Alice step one, add significantly
more to the abstract idea such that they provide an inventive concept under
Alice/Mayo step two (see Appeal Br. 12), these limitations are not additional
elements beyond the abstract idea, but rather are directed to the abstract idea
as noted previously. See Revised Guidance, 84 Fed. Reg. at 56 (instructing
that additional recited elements should be evaluated in Alice/Mayo step two
to determine whether they (1) add specific limitations that are not well-
understood, routine, and conventional in the field, or (2) simply append
well-understood, routine, and conventional activities previously known to
the industry (citing MPEP § 2106.05(d)). These elements form part of the
recited abstract ideas and thus are not “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 78); see also Revised Guidance, 84 Fed.
Reg. at 55 n.24 (“USPTO guidance uses the term ‘additional elements’ to
refer to claim features, limitations, and/or steps that are recited in the claim
beyond the identified judicial exception.” (Emphasis added)); Ans. 8–9.
To the extent Appellant contends that the claimed invention is rooted
in technology because it is ostensibly directed to a technical solution (see
Appeal Br. 12), we disagree. Even assuming, without deciding, that the
claimed invention can deliver electronic receipts faster than before, any
speed increase comes from the capabilities of the generic computer
components—not the recited process itself. See FairWarning IP, LLC v.
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Iatric Sys., Inc., 839 F.3d 1089, 1095 (Fed. Cir. 2016) (citing Bancorp
Servs., L.L.C. v. Sun Life Assurance Co. of Can. (U.S.), 687 F.3d 1266, 1278
(Fed. Cir. 2012) (“[T]he fact that the required calculations could be
performed more efficiently via a computer does not materially alter the
patent eligibility of the claimed subject matter.”)); see also Intellectual
Ventures I LLC v. Erie Indemnity Co., 711 F. App’x 1012, 1017 (Fed. Cir.
2017) (unpublished) (“Though the claims purport to accelerate the process
of finding errant files and to reduce error, we have held that speed and
accuracy increases stemming from the ordinary capabilities of a general-
purpose computer ‘do[ ] not materially alter the patent eligibility of the
claimed subject matter.’”). Like the claims in FairWarning, the focus of
claim 11 is not on an improvement in computer processors as tools, but on
certain independently abstract ideas that use generic computing components
as tools. See FairWarning, 839 F.3d at 1095 (citations and quotation marks
omitted).
To the extent Appellant argues for the first time in the Reply Brief
that the type of data presented in the “data item,” as recited in claims 21—
i.e., the (“advertisement”), 22 (“video”), and 23 (“promotional item provided
by a vendor”)—constitutes something more than the abstract idea, we are
unpersuaded. See Reply Br. 3–4. These different types of data that may be
displayed do not integrate the recited abstract idea into a practical
application. See 2019 Revised Guidance 84 Fed. Reg. at 55 (identifying
adding “insignificant extra-solution activity to the” abstract idea as an
example of when an abstract idea has not been integrated into a practical
application); see also Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d 1350,
1354 (Fed. Cir. 2016) (“we have recognized that merely presenting the
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results of abstract processes of collecting and analyzing information, without
more (such as identifying a particular tool for presentation), is abstract as an
ancillary part of such collection and analysis”) (citing Content Extraction &
Transmission LLC v. Wells Fargo Bank, Nat’l Ass’n, 776 F.3d 1343, 1347
(Fed. Cir. 2014); Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 715 (Fed.
Cir. 2014)).
Accordingly, we sustain the Examiner’s rejection of the pending
claims under 35 U.S.C. § 101 as directed to patent-ineligible subject matter.
CONCLUSION
We affirm the rejection of claims 1–18 and 21–23 under 35 U.S.C.
§ 101.
DECISION SUMMARY
Claims
Rejected
35 U.S.C. § Reference(s)/Basis Affirmed Reversed
1–18, 21–23 101 1–18, 21–23

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