Srinivas D. Reddy et al.

Patent Trials and Appeals Board

Oct 30, 2019

14046527 - (D) (P.T.A.B. Oct. 30, 2019)

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.
14/046,527 10/04/2013 Srinivas D. Reddy 002328.0881 8398
5073 7590 10/30/2019
BAKER BOTTS L.L.P.
2001 Ross Avenue, 9th Floor
Dallas, TX 75201
EXAMINER
CHAKRAVARTI, ARUNAVA
ART UNIT PAPER NUMBER
3693
NOTIFICATION DATE DELIVERY MODE
10/30/2019 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):
PTOmail1@bakerbotts.com
PTOL-90A (Rev. 04/07)

UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte SRINIVAS D. REDDY AND CLINTON M. BARKER
Appeal 2018-004605
Application 14/046,527
Technology Center 3600
Before JENNIFER S. BISK, LARRY J. HUME, AND
JULIET MITCHELL DIRBA, Administrative Patent Judges.
HUME, Administrative Patent Judge.
DECISION ON APPEAL
STATEMENT OF THE CASE
Pursuant to 35 U.S.C. § 134(a), Appellant,1 Srinivas D. Reddy et al.,
appeals from the Examiner’s decision rejecting claims 1, 4–8, 11–14, and
17–20, which are all claims pending in the application. Appellant has
canceled claims 2, 3, 9, 10, 15, and 16. We have jurisdiction under
35 U.S.C. § 6(b).2
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 The
Prudential Insurance Company. Appeal Br. 2.
2 Our decision relies upon Appellant’s Appeal Brief (“Appeal Br.,” filed
Nov. 17, 2017); Reply Brief (“Reply Br.,” filed Mar. 29, 2018); Examiner’s
Answer (“Ans.,” mailed Jan. 30, 2018); Final Office Action (“Final Act.,”
mailed Mar. 17, 2017); and the original Specification (“Spec.,” filed
Oct. 4, 2013).
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CLAIMED SUBJECT MATTER
The claims are directed to providing a guarantee associated with an
investment. See Spec. (Title). In particular, Appellant’s disclosed
embodiments and claimed invention “relate[] generally to investments and
more particularly to providing a guarantee associated with an investment.”
Spec. ¶ 1.
Claims 1 and 14, reproduced below, are representative of the subject
matter on appeal (emphases and formatting added; labeling added to
contested prior-art limitations in claim 1):
1. A system, comprising:
a memory operable to store a plurality of guaranteed
minimum rates of return of a target date fund of an investor, the
target date fund comprising a target date and a portfolio of assets,
the target date fund configured to change the portfolio of assets as
the target date approaches, wherein each of the plurality of
guaranteed minimum rates of return is a number less than zero; and
one or more processors communicatively coupled to the
memory and operable to:
calculate a plurality of premium amounts for the
plurality of guaranteed minimum rates of return, each of the
plurality of premium amounts being for a different one of
the plurality of guaranteed minimum rates of return;
communicate for display the plurality of premium
amounts and the plurality of guaranteed minimum rates of
return;
receive a selection of one of the plurality of
guaranteed minimum rates of return by the investor, the
selected guaranteed minimum rate of return is a number less
than 0% and greater than -25%, the selected guaranteed
minimum rate of return providing a guarantee to the investor
that, at a realization date, the target date fund will have
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realized at least the selected guaranteed minimum rate of
return;
determine that the premium amount for the selected
guaranteed minimum rate of return has been paid;
[L] in response to the determination that the premium
amount for the selected guaranteed minimum rate of return
has been paid, enact the guarantee by:
beginning at a predetermined date before the
realization date, periodically:
comparing the current value of the target
date fund to the selected guaranteed minimum
rate of return;
[L1] determining, based on the comparison
and a forecasted market performance of the
target date fund, whether the selected
guaranteed minimum rate of return is expected
to be met by the target date; and
[L2] communicating for display the
determination whether the selected guaranteed
minimum rate of return is expected to be met;
and at the realization date:
determining whether the selected guaranteed
minimum rate of return was met; and
communicating for display the
determination whether the selected guaranteed
minimum rate of return was met.
14. A method, comprising:
storing a plurality of guaranteed minimum rates of return of
a target date fund of an investor, the target date fund comprising a
target date and a portfolio of assets, the target date fund configured
to change the portfolio of assets as the target date approaches,
wherein each of the plurality of guaranteed minimum rates of
return is a number less than zero;
calculating, by one or more processors, a plurality of
premium amounts for the plurality of guaranteed minimum rates of
return, each of the plurality of premium amounts being for a
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different one of the plurality of guaranteed minimum rates of
return;
communicating for display the plurality of premium
amounts and the plurality of guaranteed minimum rates of return;
receiving a selection of one of the plurality of guaranteed
minimum rates of return by the investor, the selected guaranteed
minimum rate of return is a number less than 0% and greater than
- 25%, the selected guaranteed minimum rate of return providing a
guarantee to the investor that, at a realization date, the target date
fund will have realized at least the selected guaranteed minimum
rate of return;
determining that the premium amount for the selected
guaranteed minimum rate of return has been paid;
in response to the determination that the premium amount
for the selected guaranteed minimum rate of return has been paid,
enacting the guarantee by:
beginning at a predetermined date before the
realization date, periodically:
comparing, by the one or more processors, the
current value of the target date fund to the selected
guaranteed minimum rate of return determining, based
on the comparison and a forecasted market
performance of the target date fund, whether the
selected guaranteed minimum rate of return is
expected to be met by the target date; and
communicating, by the one or more processors,
for display the determination whether the selected
guaranteed minimum rate of return is expected to be
met; and
at the realization date:
determining, by the one or more processors,
whether the selected guaranteed minimum rate of
return was met; and
communicating, by the one or more processors,
for display the determination whether the selected
guaranteed minimum rate of return was met.
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REFERENCES
The Examiner relies upon the following prior art as evidence in
rejecting the claims on appeal:
Lombardo US 2006/0116941 A1 June 1, 2006
Brown et al. (“Brown”) US 2010/0106532 A1 Apr. 29, 2010
REJECTIONS
R1. Claims 1, 4–8, 11–14, and 17–20 stand rejected under 35
U.S.C. § 101 because the claimed invention is directed to a judicial
exception (i.e., a law of nature, a natural phenomenon, or an abstract idea)
without significantly more. Final Act. 2.
R2. Claims 1, 4–8, 11–14, and 17–20 stand rejected under 35
U.S.C. § 103(a) as being unpatentable over the combination of Brown and
Lombardo. Final Act. 4.
CLAIM GROUPING
Based on Appellant’s arguments (Appeal Br. 8–16) and our discretion
under 37 C.F.R. § 41.37(c)(1)(iv), we decide the appeal of patent-ineligible
subject matter Rejection R1 of claims 1, 4–8, 11–14, and 17–20 on the basis
of representative method claim 14; and we decide the appeal of obviousness
Rejection R2 of claims 1, 4–8, 11–14, and 17–20 on the basis of
representative claim 1.3

3 “Notwithstanding any other provision of this paragraph, the failure of
appellant to separately argue claims which appellant has grouped together
shall constitute a waiver of any argument that the Board must consider the
patentability of any grouped claim separately.” 37 C.F.R. § 41.37(c)(1)(iv).
In addition, when Appellant does not separately argue the patentability of
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ISSUES AND ANALYSIS
In reaching this decision, we consider all evidence presented and all
arguments actually made by Appellant. To the extent Appellant has not
advanced separate, substantive arguments for particular claims, or other
issues, such arguments are waived. 37 C.F.R. § 41.37(c)(1)(iv).
We disagree with Appellant’s arguments with respect to claims 1, 4–
8, 11–14, and 17–20 and, unless otherwise noted, we incorporate by
reference herein and adopt as our own: (1) the findings and reasons set forth
by the Examiner in the action from which this appeal is taken, and (2) the
reasons and rebuttals set forth in the Examiner’s Answer in response to
Appellant’s arguments. We highlight and address specific findings and
arguments regarding claim 1 for emphasis as follows.
1. § 101 Rejection R1 of Claims 1, 4–8, 11–14, and 17–20
Issue 1
Appellant argues (Appeal Br. 8–13; Reply Br. 5–6) the Examiner’s
rejection of claim 1 under 35 U.S.C. § 101 as being directed to patent-
ineligible subject matter is in error. These contentions present us with the
following issue:
Under the USPTO’s Revised Guidance, informed by our governing
case law concerning 35 U.S.C. § 101, is claim 1 patent-ineligible under
§ 101?

dependent claims, the claims stand or fall with the claims from which they
depend. In re King, 801 F.2d 1324, 1325 (Fed. Cir. 1986).
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Principles of Law
A. 35 U.S.C. § 101
An invention is patent-eligible if it is a “new and useful process,
machine, manufacture, or composition of matter.” 35 U.S.C. § 101.4
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. Mayo Collaborative Servs. v. Prometheus Labs.,
Inc., 566 U.S. 66, 70 (2012) (brackets in original) (citing Diamond v. Diehr,
450 U.S. 175, 185 (1981)).
In determining whether a claim falls within an excluded category, we
are guided by the Supreme Court’s two-step framework, described in Mayo
and Alice. Alice Corp. v. CLS Bank Int’l, 573 U.S. 208, 217–18 (2014)
(citing Mayo, 566 U.S. at 75–77). 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);

4 This threshold analysis of whether a claim is directed to one of the four
statutory categories of invention, i.e., a process, machine, manufacture, or
composition of matter, is referred to as “Step 1” in the USPTO’s patent-
eligibility analysis under § 101. MPEP § 2106.
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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” (Diehr, 450 U.S. at 191); “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 (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
Supreme Court held “[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 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. (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.”).
Abstract ideas may include, but are not limited to, fundamental
economic practices, methods of organizing human activities, and
mathematical formulas or relationships. Alice, 573 U.S. at 217–21. Under
this guidance, we must therefore ensure at step one that we articulate what
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the claims are directed to with enough specificity to ensure the step one
inquiry is meaningful. Id. at 217 (“[W]e tread carefully in construing this
exclusionary principle lest it swallow all of patent law.”).
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 (citation 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, 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 Revised Guidance
The PTO recently published revised guidance in the Federal Register
concerning the application of § 101. 2019 Revised Patent Subject Matter
Eligibility Guidance, 84 Fed. Reg. 50 (January 7, 2019) (hereinafter
“Revised Guidance”) (https://www.govinfo.gov/content/pkg/FR-2019-01-
07/pdf/2018-28282.pdf).
Under the Revised Guidance, we first look to whether the claim
recites:
(1) any judicial exceptions, including certain groupings
of abstract ideas (i.e., mathematical concepts, certain methods
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of organizing human activity such as a fundamental economic
practice, or mental processes);5 and
(2) additional elements that integrate the judicial
exception into a practical application (see Manual for Patent
Examining Procedure (“MPEP”) §§ 2106.05(a)–(c), (e)–(h)).6
See Revised Guidance 52–53.
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
(4) simply appends well-understood, routine,
conventional activities previously known to the industry,
specified at a high level of generality, to the judicial exception.7
See Revised Guidance 56.
Step 2A(i) – Abstract Idea
Informed by our judicial precedent, the Revised Guidance extracts and
synthesizes key concepts identified by the courts as abstract ideas to explain
that the abstract idea exception includes the following groupings of subject
matter, when recited as such in a claim limitation:
(a) Mathematical concepts—mathematical relationships,
mathematical formulas or equations, mathematical calculations;

5 Referred to as “Revised Step 2A, Prong 1” in the Revised Guidance
(hereinafter “Step 2A(i)”).
6 Referred to as “Revised Step 2A, Prong 2” in the Revised Guidance
(hereinafter “Step 2A(ii)”).
7 Items (3) and (4) continue to be collectively referred to as “Step 2B” of the
Supreme Court’s two-step framework, described in Mayo and Alice.
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(b) Certain methods of organizing human activity —
fundamental economic principles or practices (including
hedging, insurance, mitigating risk); commercial or legal
interactions (including agreements in the form of contracts;
legal obligations; advertising, marketing or sales activities or
behaviors; business relations); managing personal behavior or
relationships or interactions between people (including social
activities, teaching, and following rules or instructions); and
(c) Mental processes—concepts performed in the human
mind (including an observation, evaluation, judgment, opinion).
Revised Guidance 52 (footnotes omitted).
Under the Revised Guidance, if the claim does not recite a judicial
exception (a law of nature, natural phenomenon, or subject matter within the
enumerated groupings of abstract ideas above), then the claim is patent-
eligible at Step 2A(i). This determination concludes the eligibility analysis,
except in situations identified in the Revised Guidance.8
However, if the claim recites a judicial exception (i.e., an abstract idea
enumerated above, a law of nature, or a natural phenomenon), the claim
requires further analysis for a practical application of the judicial exception
in Step 2A(ii).
Step 2A(ii) – Practical Application
If a claim recites a judicial exception in Step 2A(i), we determine
whether the recited judicial exception is integrated into a practical

8 In the rare circumstance in which an examiner believes a claim limitation
that does not fall within the enumerated groupings of abstract ideas should
nonetheless be treated as reciting an abstract idea, the procedure described in
of the Guidance for analyzing the claim should be followed. See Revised
Guidance, Section III.C.
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application of that exception in Step 2A(ii) by: (a) identifying whether there
are any additional elements recited in the claim beyond the judicial
exception(s); and (b) evaluating those additional elements individually and
in combination to determine whether they integrate the exception into a
practical application.
The seven identified “practical application” sections of the MPEP,9
cited in the Revised Guidance under Step 2A(ii), are:
(1) MPEP § 2106.05(a) Improvements to the Functioning of
a Computer or To Any Other Technology or Technical
Field
(2) MPEP § 2106.05(b) Particular Machine
(3) MPEP § 2106.05(c) Particular Transformation
(4) MPEP § 2106.05(e) Other Meaningful Limitations
(5) MPEP § 2106.05(f) Mere Instructions To Apply An
Exception
(6) MPEP § 2106.05(g) Insignificant Extra-Solution Activity
(7) MPEP § 2106.05(h) Field of Use and Technological
Environment
See Revised Guidance 55.
If the recited judicial exception is integrated into a practical
application as determined under one or more of the MPEP sections cited
above, then the claim is not directed to the judicial exception, and the patent-

9 See MPEP §§ 2106.05(a)–(c), (e)–(h). Citations to the MPEP herein refer
to revision [R-08.2017]. Sections 2106.05(a), (b), (c), and (e) are indicative
of integration into a practical application, while §§ 2106.05(f), (g), and (h)
relate to limitations that are not indicative of integration into a practical
application.
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eligibility inquiry ends. See Revised Guidance 54. If not, then analysis
proceeds to Step 2B.
Step 2B – “Inventive Concept” or “Significantly More”
Under our reviewing courts’ precedent, it is possible that a claim that
does not “integrate” a recited judicial exception under Step 2A(ii) is
nonetheless patent eligible. For example, the claim may recite additional
elements that render the claim patent eligible even though one or more claim
elements may recite a judicial exception.10 The Federal Circuit has held
claims eligible at the second step of the Alice/Mayo test (USPTO Step 2B)
because the additional elements recited in the claims provided “significantly
more” than the recited judicial exception (e.g., because the additional
elements were unconventional in combination).11 Therefore, if a claim has
been determined to be directed to a judicial exception under Revised Step
2A, we must also evaluate the additional elements individually and in
combination under Step 2B to determine whether they provide an inventive
concept (i.e., whether the additional elements amount to significantly more
than the exception itself).12

10 See, e.g., Diehr, 450 U.S. at 187.
11 See, e.g., Amdocs (Israel), Ltd. v. Openet Telecom, Inc., 841 F.3d 1288,
1300, 1304 (Fed. Cir. 2016); BASCOM Global Internet Services, Inc. v.
AT&T Mobility LLC, 827 F.3d 1341, 1349–52 (Fed. Cir. 2016); DDR
Holdings v. Hotels.com, L.P., 773 F.3d 1245, 1257–59 (Fed. Cir. 2014).
12 The patent eligibility inquiry may contain underlying issues of fact.
Mortg. Grader, Inc. v. First Choice Loan Servs. Inc., 811 F.3d 1314, 1325
(Fed. Cir. 2016). In particular, “[t]he question of whether a claim element or
combination of elements is well-understood, routine and conventional to a
skilled artisan in the relevant field is a question of fact.” Berkheimer v. HP
Inc., 881 F.3d 1360, 1368 (Fed. Cir. 2018).
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Under the Revised Guidance, we must consider in Step 2B 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 Revised Guidance,
Section III.B.13
In the Step 2B analysis, an additional element (or combination of
elements) is not well-understood, routine or conventional unless the
examiner finds an evidentiary basis, and expressly supports a rejection in
writing with, one or more of the following:
1. A citation to an express statement in the
specification or to a statement made by an applicant during
prosecution that demonstrates the well-understood, routine,
conventional nature of the additional element(s). . . .
2. A citation to one or more of the court decisions
discussed in MPEP § 2106.05(d)(II) as noting the well-

13 In accordance with existing Step 2B guidance, an Examiner’s finding that
an additional element (or combination of elements) is well understood,
routine, conventional activity must be supported with at least one of the four
specific types of evidence required by the USPTO Berkheimer
Memorandum, as shown above. For more information concerning evaluation
of well-understood, routine, conventional activity, see MPEP § 2106.05(d),
as modified by the USPTO Berkheimer Memorandum (USPTO
Commissioner for Patents Memorandum dated Apr. 19, 2018, “Changes in
Examination Procedure Pertaining to Subject Matter Eligibility, Recent
Subject Matter Eligibility Decision (Berkheimer v. HP, Inc.)” (hereinafter
“Berkheimer Memo”).
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understood, routine, conventional nature of the additional
element(s).
3. A citation to a publication that demonstrates the
well-understood, routine, conventional nature of the additional
element(s). . . .
4. A statement that the examiner is taking official
notice of the well-understood, routine, conventional nature of
the additional element(s). . . .
See Berkheimer Memo 3–4.
If the Examiner or the Board determines under Step 2B that the
element (or combination of elements) amounts to significantly more than the
exception itself, the claim is eligible, thereby concluding the eligibility
analysis.
However, if a determination is made that the element and combination
of elements do not amount to significantly more than the exception itself, the
claim is ineligible under Step 2B, and the claim should be rejected for lack of
subject matter eligibility.
Analysis
Step 1 – Statutory Category
Claim 14, as a process (method) claim, recites one of the enumerated
categories of eligible subject matter in 35 U.S.C. § 101. Therefore, the issue
before us is whether it is directed to a judicial exception without
significantly more.
The Examiner determined that claim 1 is directed to “a method of
providing [an] investment guarantee” (Final Act. 2) and, “[t]hus, the claims
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are abstract because they deal with fundamental economic practice.” Final
Act. 3.
We conclude claim 1 does not recite the judicial exceptions of either
natural phenomena or laws of nature. We evaluate, de novo, whether
claim 1 recites an abstract idea based upon the Revised Guidance.
First, we look to the Specification to provide context as to what the
claimed invention is directed to. In this case, the Specification discloses that
the invention “relates generally to investments and more particularly to
providing a guarantee associated with an investment.” Spec. ¶ 1.
Appellant’s Abstract describes the invention in the following way:
According to one embodiment, a system includes one or
more processors operable to receive data indicative of an
account associated with one or more investments by an investor
in a target date fund. The processors are further operable to
calculate a plurality of premium amounts for a plurality of
negative guarantees, communicate an indication of the premium
amounts and the negative guarantees, and receive an indication
of a selection of one of the negative guarantees. The selected
negative guarantee provides a guarantee that, at a realization
date, an account value of the account will be at least equal to an
amount less than a principal amount regardless of market
performance of the target date fund. The processors are further
operable to, at the realization date, determine whether the
selected negative guarantee was met by the account value, and
communicate an indication of whether the selected negative
guarantee was met.
Spec. 41 (Abstract).
Appellant presents several arguments concerning the lack of
abstractness of the claims on appeal.
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Enfish14
Appellant argues “[t]he pending claims perform particular automatic
actions, the automatic performance of which, like in Enfish, is associated
with a reduction in the use of computer resources . . . . Claim 1 recites
performing a number of actions ‘in response to the determination that the
premium amount of the selected guaranteed minimum rate of return has been
paid.’” Appeal Br. 9.15 Further, “[t]he automatic performance of these
actions reduces the CPU resources, memory resources, and network
bandwidth that would otherwise be required to perform these actions.
Because the pending claims are directed to an improvement in computer
technology similar to Enfish . . . the pending claims recite patent eligible
subject matter.” Id.
We disagree with Appellant’s contentions. We disagree because, in
Enfish, our reviewing court held claims directed to a self-referential logical
model for a computer database patent-eligible under step one of Alice.
Enfish, 822 F.3d at 1330. The disclosed technique enabled faster searching
and more effective storage of data than previous methods. Id. at 1333. The
court found the claims directed to “a specific improvement to the way
computers operate, embodied in the self-referential table” (id. at 1336), and

14 Enfish, LLC v. Microsoft Corp., 822 F.3d 1327 (Fed. Cir. 2016).
15 Appellant makes only tangential reference to McRO, Inc. v. Bandai
Namco Games Am. Inc., 837 F.3d 1299 (Fed. Cir. 2016) in their Appeal
Brief. “Because the pending claims are directed to an improvement in
computer technology similar to Enfish and McRO, Appellant respectfully
requests the Board to find that the pending claims recite patent eligible
subject matter.” Appeal Br. 9. However, we are not persuaded because, in
McRO, “the incorporation of the claimed rules, not the use of the computer,”
improved an existing technological process. McRO, 837 F.3d at 1314.
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explained that the claims are “not simply directed to any form of storing
tabular data, but instead are specifically directed to a self-referential table
for a computer database” that functions differently than conventional
databases. Id. at 1337.
We do not find the claims on appeal, which trigger one or more
computer actions in response to a payment being received, to be sufficiently
analogous to those in Enfish, in which the Federal Circuit held the claims to
be an improvement in the operation of the computer.
In TABLE 1 below, we identify in italics the specific claim
limitations that we conclude recite an abstract idea and support for our
conclusions. We additionally identify in bold the additional (non-abstract)
claim limitations that are generic computer components and techniques
(bracketed lettering added for reference):
TABLE 1
Independent Claim 14 Revised Guidance
A method, comprising: A method (process) is a statutory
subject matter class. See 35 U.S.C.
§ 101.
[a] storing a plurality of
guaranteed minimum rates of
return of a target date fund of an
investor,
the target date fund comprising
a target date and a portfolio of
assets,
the target date fund configured
to change the portfolio of assets
as the target date approaches,
Storing data is a generic computer
function.
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Independent Claim 14 Revised Guidance
wherein each of the plurality of
guaranteed minimum rates of
return is a number less than
zero;
[b] calculating, by one or
more processors, a plurality
of premium amounts for the
plurality of guaranteed
minimum rates of return, each
of the plurality of premium
amounts being for a different
one of the plurality of
guaranteed minimum rates of
return;
A mathematical calculation is an
abstract idea. Revised Guidance 52
and n.12 citing SAP America, Inc. v.
InvestPic, LLC, 898 F.3d 1161, 1163
(Fed. Cir. 2018) (holding that claims to
a “series of mathematical calculations
based on selected information” are
directed to abstract ideas).
A processor is a generic computer
component.
[c] communicating for
display the plurality of
premium amounts and the
plurality of guaranteed
minimum rates of return;
Transmitting information for display is
insignificant extra-solution activity.
Revised Guidance 55, n.31.
[d] receiving a selection of one
of the plurality of guaranteed
minimum rates of return by the
investor,
the selected guaranteed
minimum rate of return is a
number less than 0% and
greater than -25%, the selected
guaranteed minimum rate of
return
Receiving information, i.e., data
gathering, is merely insignificant
extra-solution activity that does not
add significantly more to the abstract
idea to render the claimed invention
patent-eligible. Revised Guidance 55,
n.31; see In re Bilski, 545 F.3d 943,
962 (Fed. Cir. 2008) (en banc), aff’d
on other grounds, 561 U.S. 593 (2010)
(“[T]he involvement of the machine or
transformation in the claimed process
must not merely be insignificant extra-
solution activity”)
[e] providing a guarantee to
the investor that, at a
realization date, the target date
fund will have realized at least
Providing or enacting a guarantee is an
abstract idea, i.e., “Certain methods of
organizing human activity . . .
including . . . commercial interactions
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Independent Claim 14 Revised Guidance
the selected guaranteed
minimum rate of return;
. . . in the form of . . . advertising,
marketing or sales activities”. See
Revised Guidance 52.
[f] determining that the
premium amount for the
selected guaranteed minimum
rate of return has been paid;
in response to the
determination that the
premium amount for the
selected guaranteed minimum
rate of return has been paid,
Determining is an abstract idea, i.e., an
observation, evaluation, judgment,
opinion which could be performed as a
mental process. See Revised Guidance
52.
[g] enacting the guarantee by:
beginning at a predetermined
date before the realization
date, periodically:
Enacting a guarantee is an abstract
idea, i.e., “Certain methods of
organizing human activity . . .
including . . . commercial interactions .
. . in the form of . . . advertising,
marketing or sales activities” or,
alternatively, a fundamental economic
practice. See Revised Guidance 52.
[h] comparing, by the one or
more processors, the current
value of the target date fund to
the selected guaranteed
minimum rate of return[,]
Comparing is an abstract idea, i.e., an
observation, evaluation, judgment,
opinion” which could be performed as
a mental process. See Revised
Guidance 52.
[i] determining, based on the
comparison and a forecasted
market performance of the
target date fund, whether the
selected guaranteed minimum
rate of return is expected to be
met by the target date; and
Determining is an abstract idea, i.e., an
observation, evaluation, judgment,
opinion which could be performed as a
mental process. See Revised Guidance
52.
[j] communicating, by the one
or more processors, for
display the determination
Communicating or transmitting of
information for display is insignificant
post-solution activity. Revised
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Independent Claim 14 Revised Guidance
whether the selected
guaranteed minimum rate of
return is expected to be met;
and at the realization date:
Guidance 55, n.31; see also MPEP
§ 2106.05(g); and see buySAFE, Inc. v.
Google, Inc., 765 F.3d 1350, 1355
(Fed. Cir. 2014) (computer receives
and sends information over a network).
[k] determining, by the one or
more processors, whether the
selected guaranteed minimum
rate of return was met; and
Determining is an abstract idea, i.e., an
observation, evaluation, judgment,
opinion which could be performed as a
mental process. See Revised Guidance
52.
[l] communicating, by the one
or more processors, for
display the determination
whether the selected
guaranteed minimum rate of
return was met.
Communicating of transmitting or
information for display is insignificant
post-solution activity. Revised
Guidance 55, n.31; see also MPEP
§ 2106.05(g); and see buySAFE, 765
F.3d at 1355 (computer receives and
sends information over a network).
Spec. 24–25 (Claims App.).
We determine that claim 1, when taken as a whole, recites certain
methods of organizing human activity in the form of a fundamental
economic practice, i.e., as an investment rate guarantee or, alternatively,
recites a commercial interaction including agreements in the form of
contracts or legal obligations. This type of activity, i.e., guaranteeing
investment rates of return, as recited in each of limitations (a) through (l), for
example, aside from being carried out by a computer, includes longstanding
conduct that existed well before the advent of computers and the Internet,
and could be carried out by a human in the mind and/or with pen and paper.
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See CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d 1366, 1375 (Fed.
Cir. 2011).16
Thus, under Step 2A(i), we agree with the Examiner that the system of
claim 1 recites a judicial exception. In particular, we conclude claim 1,
under our Revised Guidance, recites a judicial exception of certain methods
of organizing human activity in the form of a fundamental economic practice
or, alternatively, as a commercial interaction, and thus an abstract idea.
Step 2A(ii): Judicial Exception Integrated into a Practical Application?
If the claims recite a patent-ineligible concept, as we conclude above
with respect to representative method claim 14, we proceed to the “practical
application” Step 2A(ii) in which we determine whether the recited judicial
exception is integrated into a practical application of that exception by: (a)
identifying whether there are any additional elements recited in the claim
beyond the judicial exception(s); and (b) evaluating those additional
elements individually and in combination to determine whether they
integrate the exception into a practical application.

16 Our reviewing court recognizes that “[a]n abstract idea can generally be
described at different levels of abstraction.” Apple, Inc. v. Ameranth, Inc.,
842 F.3d 1229, 1240 (Fed. Cir. 2016). That need not and, in this case does
not, “impact the patentability analysis.” Id. at 1241. Further, “[t]he Board’s
slight revision of its abstract idea analysis does not impact the patentability
analysis.” Id. Moreover, merely combining several abstract ideas does not
render the combination any less abstract. RecogniCorp, LLC v. Nintendo
Co., 855 F.3d 1322, 1327 (Fed. Cir. 2017) (“Adding one abstract idea (math)
to another abstract idea . . . does not render the claim non-abstract.”); see
also FairWarning IP, LLC v. Iatric Sys., Inc., 839 F.3d 1089, 1093–94 (Fed.
Cir. 2016) (determining the pending claims were directed to a combination
of abstract ideas).
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As to the specific limitations, we find limitation (d) recites
insignificant data gathering. See MPEP § 2106.05(g). Data gathering, as
performed by the steps or function in Appellant’s claims, is a classic
example of insignificant extra-solution activity. See, e.g., In re Bilski, 545
F.3d 943, 963 (Fed. Cir. 2008) (en banc), aff’d sub nom, Bilski v. Kappos,
561 U.S. 593 (2010).
We also find limitations (c), (j), and (l) recite insignificant extra-
solution activity.17 The Supreme Court guides that the “prohibition against
patenting abstract ideas ‘cannot be circumvented’ [by] adding ‘insignificant
postsolution activity.’” Bilski, 561 U.S. at 610–11 (quoting Diehr, 450 U.S.
at 191–92). On this record, we are of the view that Appellant’s claims does
not operate the recited generic computer components in an unconventional
manner to achieve an improvement in computer functionality. See MPEP
§ 2106.05(a).
In addition to the abstract steps recited in limitations (b), (e) through
(i), and (k) identified in Step 2A(i), supra, and the extra-solution activity
recited by limitations (c), (d), (j), and (l), claim 14 further recites storing data
(limitation (a)), using one or more processors (limitations (b), (h), (j), (k),
and (l)).
We find each of the limitations of claim 1 recite abstract ideas and/or
extra-solution activity as identified in Step 2A(i), supra, and none of the
limitations integrate the judicial exception of certain methods of organizing

17 We also note the “determining” and “comparing” steps can be carried out
by a human in the mind or by use of pen and paper. See CyberSource, 654
F.3d at 1375.
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human activity into a practical application as determined under one or more
of the MPEP sections cited above.
Under analogous circumstances, the Federal Circuit has held that
“[t]his is a quintessential ‘do it on a computer’ patent: it acknowledges that
[such] data . . . was previously collected, analyzed, manipulated, and
displayed manually, and it simply proposes doing so with a computer. We
have held such claims are directed to abstract ideas.” Univ. of Fla. Research
Found., Inc. v. Gen. Elec. Co., 916 F.3d 1363, 1367 (Fed. Cir. 2019); see
also Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d 1350, 1351 (Fed.
Cir. 2016) (“Though lengthy and numerous, the claims do not go beyond
requiring the collection, analysis, and display of available information in a
particular field, stating those functions in general terms, without limiting
them to technical means for performing the functions that are arguably an
advance over conventional computer and network technology.”).
Therefore, the claim as a whole merely uses instructions to implement
the abstract idea on a computer or, alternatively, merely uses a computer as a
tool to perform the abstract idea. Thus, on this record, Appellant has not
shown an improvement or practical application under the guidance of
Manual of Patent Examining Procedure section 2106.05(a) (“Improvements
to the Functioning of a Computer or to Any Other Technology or Technical
Field”) or section 2106.05(e)(“Other Meaningful Limitations”). Nor does
Appellant advance any arguments in the Brief(s) that are directed to the
Bilski machine-or-transformation test, which would only be applicable to the
method (process) claims on appeal. See MPEP §§ 2106.05(b) (Particular
Machine) and 2106.05(c) (Particular Transformation).
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Therefore, we conclude the abstract idea is not integrated into a
practical application, and thus the claim is directed to the judicial exception.
Step 2B – “Inventive Concept” or “Significantly More”
If the claims are directed to a patent-ineligible concept, as we
conclude above, we proceed to the “inventive concept” step. For Step 2B we
must “look with more specificity at what the claim elements add, in order to
determine ‘whether they identify an “inventive concept” in the application of
the ineligible subject matter’ to which the claim is directed.” Affinity Labs
of Texas, LLC v. DIRECTV, LLC, 838 F.3d 1253, 1258 (Fed. Cir. 2016)
(quoting Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d 1350, 1353 (Fed.
Cir. 2016)).
As stated in the Revised Guidance, many of the considerations to
determine whether the claims amount to “significantly more” under step two
of the Alice framework are already considered as part of determining
whether the judicial exception has been integrated into a practical
application. Revised Guidance at 56. Thus, at this point of our analysis, we
determine if the claims add a specific limitation, or combination of
limitations, that is not well-understood, routine, conventional activity in the
field, or simply appends well-understood, routine, conventional activities at
a high level of generality. Id.
In applying step two of the Alice analysis, our reviewing court guides
we must “determine whether the claims do significantly more than simply
describe [the] abstract method” and thus transform the abstract idea into
patentable subject matter. Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709,
715 (Fed. Cir. 2014). We look to see whether there are any “additional
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features” in the claims that constitute an “inventive concept,” thereby
rendering the claims eligible for patenting even if they are directed to an
abstract idea. Alice, 573 U.S. at 221. Those “additional features” must be
more than “well-understood, routine, conventional activity.” Mayo, 566
U.S. at 79.
Limitations referenced in Alice that are not enough to qualify as
“significantly more” when recited in a claim with an abstract idea include, as
non-limiting or non-exclusive examples: adding the words “apply it” (or an
equivalent) with an abstract idea18; mere instructions to implement an
abstract idea on a computer19; or requiring no more than a generic computer
to perform generic computer functions that are well-understood, routine and
conventional activities previously known to the industry.20
Evaluating representative method claim 14 under step 2 of the Alice
analysis, we conclude it lacks an inventive concept that transforms the
judicial exception of certain methods of organizing human activity into a
patent-eligible application of that abstract idea.
The patent eligibility inquiry may contain underlying issues of fact.
Mortg. Grader, 811 F.3d at 1325. In particular, “[t]he question of whether a
claim element or combination of elements is well-understood, routine and

18 Alice, 573 U.S. at 221–23.
19 Alice, 573 U.S. at 221, e.g., simply implementing a mathematical
principle on a physical machine, namely a computer (citing Mayo, 566 U.S.
at 84–85).
20 Alice, 573 U.S. at 225, e.g., using a computer to obtain data, adjust
account balances, and issue automated instructions.
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conventional to a skilled artisan in the relevant field is a question of fact.”
Berkheimer, 881 F.3d at 1368.
As evidence of the conventional nature of the recited “storing” step
and “one or more processors” in method claim 14, the Specification
discloses, “[a]s illustrated, calculation device 14 includes a network interface
18, a processor 22, and a memory 26.” Spec. 9, ll. 14–15. Further,
“[p]rocessor 22 communicatively couples to network interface 18 and
memory 26, and controls the operation and administration of calculation
device 14 by processing information received from network interface 18 and
memory 26.” Spec. 9, ll. 29–31.
Thus, because the Specification describes the additional elements in
general terms, without describing the particulars, we conclude the claim
limitations may be broadly but reasonably construed as reciting conventional
computer components and techniques, particularly in light of Appellant’s
Specification, as quoted above.21
With respect to this step of the analysis, Appellant argues, “[t]he
pending claims are patent-eligible because they recite an unconventional
system and method of providing a guaranteed rate of return” allegedly
because “the pending claims do not attempt to cover every possible way of
providing a guaranteed rate of return; instead, the claims recite a particular
way of doing so.” Appeal Br. 10. We disagree.

21 Claim terms are to be given their broadest reasonable interpretation, as
understood by those of ordinary skill in the art and taking into account
whatever enlightenment may be had from the Specification. In re Morris,
127 F.3d 1048, 1054 (Fed. Cir. 1997).
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Regarding preemption, “[w]hile preemption may signal patent
ineligible subject matter, the absence of complete preemption does not
demonstrate 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
(Fed. Cir. 2015); see also OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d
1359, 1362–63 (Fed. Cir. 2015) (“that the claims do not preempt all price
optimization or may be limited to price optimization in the e-commerce
setting do not make them any less abstract”).
The Manual of Patent Examining Procedure, based upon our
precedential guidance, provides additional considerations with respect to
analysis of the well-understood, routine, and conventional nature of the
claimed computer-related components.
Another consideration when determining whether a claim
recites significantly more than a judicial exception is whether
the additional elements amount to more than a recitation of the
words “apply it” (or an equivalent) or are more than mere
instructions to implement an abstract idea or other exception on
a computer. As explained by the Supreme Court, in order to
transform a judicial exception into a patent-eligible application,
the additional element or combination of elements must do
“‘more than simply stat[e] the [judicial exception] while adding
the words ‘apply it’”. Alice Corp. v. CLS Bank, 573 U.S. __,
134 S. Ct. 2347, 2357, 110 USPQ2d 1976, 1982-83 (2014)
(quoting Mayo Collaborative Servs. v. Prometheus Labs., Inc.,
566 U.S. 66, 72, 101 USPQ2d 1961, 1965). Thus, for example,
claims that amount to nothing more than an instruction to apply
the abstract idea using a generic computer do not render an
abstract idea eligible. Alice Corp., 134 S. Ct. at 2358, 110
USPQ2d at 1983. See also 134 S. Ct. at 2389, 110 USPQ2d at
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1984 (warning against a § 101 analysis that turns on “the
draftsman’s art”) . . . .
In Alice Corp., the claim recited the concept of
intermediated settlement as performed by a generic computer.
The Court found that the recitation of the computer in the claim
amounted to mere instructions to apply the abstract idea on a
generic computer. 134 S. Ct. at 2359-60, 110 USPQ2d at 1984.
The Supreme Court also discussed this concept in an earlier
case, Gottschalk v. Benson, 409 U.S. 63, 70, 175 USPQ 673,
676 (1972), where the claim recited a process for converting
binary-coded decimal (BCD) numerals into pure binary
numbers. The Court found that the claimed process had no
substantial practical application except in connection with a
computer. Benson, 409 U.S. at 71-72, 175 USPQ at 676. The
claim simply stated a judicial exception (e.g., law of nature or
abstract idea) while effectively adding words that “apply it” in a
computer. Id.
MPEP § 2106.05(f) (“Mere Instructions To Apply An Exception”).
With respect to the Step 2B analysis, we conclude, similar to Alice, the
recitation of a method that includes “storing” data using “one or more
processors” (claim 14), as argued by Appellant, is simply not enough to
transform the patent-ineligible abstract idea here into a patent-eligible
invention under Step 2B. See Alice, 573 U.S. at 221 (“[C]laims, which
merely require generic computer implementation, fail to transform [an]
abstract idea into a patent-eligible invention.”).
Therefore, in light of the foregoing, we conclude, under the Revised
Guidance, that each of Appellant’s claims, considered as a whole, is directed
to a patent-ineligible abstract idea that is not integrated into a practical
application and does not include an inventive concept. Accordingly, we
sustain the Examiner’s § 101 rejection of independent claim 14, and grouped
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claims 1, 4–8, 11–13, and 17–20 which fall therewith. See Claim Grouping,
supra.
2. § 103(a) Rejection R2 of Claims 1, 4–8, 11–14, and 17–20
Issue 2
Appellant argues (Appeal Br. 13–16; Reply Br. 2–4) the Examiner’s
rejection of claim 1 under 35 U.S.C. § 103(a) as being obvious over the
combination of Brown and Lombardo is in error. These contentions present
us with the following issue:
Did the Examiner err in finding:
(a) The combination of Brown and Lombard is improper because,
allegedly, a person of ordinary skill in the art would not be motivated to
combine Lombardo with Brown given Brown’s disclosure that the rate of
return used to guarantee a payout is not less than zero, i.e., Brown teaches
away from the disclosure of Lombardo; and
(b) The cited prior art combination teaches or suggests a system that
includes “one or more processors communicatively coupled to the memory
and operable to . . . in response to the determination that the premium
amount for the selected guaranteed minimum rate of return has been paid,
enact the guarantee by . . . beginning at a predetermined date before the
realization date, periodically”
[L1] “determining, based on the comparison and a
forecasted market performance of the target date fund, whether
the selected guaranteed minimum rate of return is expected to
be met by the target date;” and
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[L2] “communicating for display the determination
whether the selected guaranteed minimum rate of return is
expected to be met,”
as recited in claim 1?
Principles of Law
In KSR, the Court stated “[t]he combination of familiar elements
according to known methods is likely to be obvious when it does no more
than yield predictable results.” KSR Int’l Co. v. Teleflex, Inc., 550 U.S. 398,
416 (2007).
When a work is available in one field of endeavor, design
incentives and other market forces can prompt variations of it,
either in the same field or a different one. If a person of
ordinary skill can implement a predictable variation, § 103
likely bars its patentability. For the same reason, if a technique
has been used to improve one device, and a person of ordinary
skill in the art would recognize that it would improve similar
devices in the same way, using the technique is obvious unless
its actual application is beyond his or her skill . . . . [A] court
must ask whether the improvement is more than the predictable
use of prior art elements according to their established
functions.
Id. at 417.
Further, the relevant inquiry is whether the Examiner has set forth
“some articulated reasoning with some rational underpinning to support the
legal conclusion of obviousness.” In re Kahn, 441 F.3d 977, 988 (Fed.
Cir. 2006) (cited with approval in KSR, 550 U.S. at 418).
Moreover, “[a] reference may be said to teach away when a person of
ordinary skill, upon reading the reference, would be discouraged from
following the path set out in the reference, or would be led in a direction
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divergent from the path that was taken by the applicant.” In re Gurley, 27
F.3d 551, 553 (Fed. Cir. 1994); Para-Ordnance Mfg., Inc. v. SGS Importers
Int’l., Inc., 73 F.3d 1085, 1090 (Fed. Cir. 1995).
Analysis
(a) Motivation to Combine was Proper
The Examiner finds, “it would have been obvious to a person of
ordinary skills in the art to ensure that a guarantee premium is paid before
performing the performance guarantee comparison.” Final Act. 6. The
Examiner further finds:
[I]t would have been obvious to a person having ordinary
skills in the art at the time of the invention to modify Brown as
it relates to an annuity product that offers a guaranteed return at
a target date to include Lombardo as it relates to an investment
vehicle that offers a guaranteed return using reinsurance to
eliminate market risk. The motivation for combining the
references would have been to eliminate market risk in target
date investments.
Final Act. 6–7.
Appellant contends they “intended the Examiner to interpret the teach
away argument as the disclosure of Brown teaching away from the
disclosure of Lombardo” (Appeal Br. 13), and “a person of ordinary skill in
the art would not be motivated to combine Lombardo with Brown given
Brown’s disclosure that the rate of return used to guarantee a payout is not
less than zero” (Appeal Br. 13–14). This is allegedly because “Brown
explicitly discloses that the rate of return is not less than zero[ ] and
Lombardo teaches that the rate of return can be negative such that ‘losses are
limited to three percent (-3%) a year.’” Appeal Br. 13 (footnote omitted).
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In response, the Examiner finds, and we agree, “Insurance and fund
management companies offer multiple products to different types of
investors based on their risk tolerance.” Ans. 10. We further agree with the
Examiner that
both Brown and Lombardo offer products that guarantee zero
loss of premium for their investors. Therefore, to suggest that
one of ordinary skills would not combine Brown and Lombardo
is not persuasive.
Whether a company guarantees losses up to x% or -y%
for an investment product is a business and financial decision
that takes into business competition, volatility of investments
and investor's tolerance for risk. Thus, we have Brown offering
guaranteed return not less than 3% in some products and not
less than zero in other products [ ]. Similarly, Lombardo limits
sets a floor on losses from 0% to -3%. The minimum rate
guarantee is a flexible option offered to investors for marketing
each fund and not an intrinsic unchangeable value. Both
references offer similar type of minimum performance
guaranteed investment products.
Ans. 10–11 (citing Brown ¶ 24).
The test for obviousness is what the combined teachings of the prior
art would have suggested to the hypothetical person of ordinary skill in the
art. In re Keller, 642 F.2d 413, 425 (CCPA 1981). We are not persuaded by
Appellant’s teach away argument because, as set forth by the Examiner, the
rejection is based upon what the combination of Brown and Lombardo
would have suggested to a person of ordinary skill in the art.
In particular, we agree with the Examiner’s finding that the decision
as to how much of a loss is guaranteed by a company is a business decision
that is fully within the capability of a person with skill in the art to
determine. Furthermore, Appellant has not demonstrated that the
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Examiner’s proffered combination of references would have been “uniquely
challenging or difficult for one of ordinary skill in the art.” See Leapfrog
Enters., Inc. v. Fisher-Price, Inc., 485 F.3d 1157, 1162 (Fed. Cir. 2007)
(citing KSR, 550 U.S. at 418). Nor has Appellant provided objective
evidence of secondary considerations which our reviewing court guides
“operates as a beneficial check on hindsight.” Cheese Sys., Inc. v. Tetra Pak
Cheese and Powder Sys., 725 F.3d 1341, 1352 (Fed. Cir. 2013).
(b) All Limitations are Taught or Suggested
Limitation [L1] — “determining” function
Appellant contends the Brown-Lombardo combination does not teach
or suggest the contested “periodically . . . determining . . . whether the
selected guaranteed minimum rate of return is expected to be met by the
target date” limitation. Appeal Br. 14. In particular, Appellant argues
At most, the relied on portions of Brown teaches periodically
determining if the account value exceeds the target value . . . .
Notably, the cited portions of Brown do not disclose
“determining whether the selected guaranteed minimum rate of
return is expected to be met by the target date” as recited in
Claim 1. Indeed, Brown does not need to determine whether the
rate of return will be met by the target date because, as
recognized by the Examiner, the annuity issuer will have to pay
the account holder any difference that exists between the target
value and the account value on the target date. Final Office
Action, p. 11. The reason that Brown discloses periodically
calculating the difference is to determine whether the account
value exceeds the target value (i.e., not to determine whether
the target value will be met by the target date).
Appeal Br. 15 (citing Brown ¶¶ 10 and 12).
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In response, the Examiner finds, and we agree, “Brown [in paragraphs
10 and 12] teaches periodically comparing the market value of the account
holder's investment to the target value.” For example:
The present invention provides an annuity product with a
Target Date Benefit at a predetermined date called the Target
Value Date. The Target Value Date can be a chosen contract
anniversary date which, in at least one embodiment, is at least
seven years after issue. The predetermined value of the annuity
at the Target Value Date is called the Target Value, which
could be, for example, total premiums paid, premiums grown at
a predetermined amount, a high water account value, or other
quantity. . . . Periodically, between issue and the Target Value
Date, if the account value (the actual value of the account
holder's investment choices) exceeds the Target Value, the
Target Value will be increased to match the account value. . . .
Finally, on the Target Value Date, if the account value is less
than the Target Value, the annuity issuer will credit the account
an amount sufficient to increase the account value to match the
Target Value.
Brown ¶ 10. The Examiner further finds:
[A]nalyst forecasts [exist] for every investment under the sun
and therefore every target date investment has a forecasted
value which may differ from the eventual market value.
Furthermore, Lombardo teaches this limitation. Lombardo
discloses placing individual's money with an entity because it
expects to reverse market the downturns and achieve expected
rates of return (Para [0022]; the entity that write the contract for
the investment will have the expected known outcomes (Para
[0028]; as shown in FIG. 6, the average rate of return over the
years is consistent with the expected return for the combined 2-
beta/lower risk investment strategy (Para [0073]). Thus,
Lombardo teaches whether investor's fund will be able to
achieve its forecasted rate of return. Hence, the combination of
Brown-Lombardo teaches this limitations.
Ans. 12–13.
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Therefore, based upon the above, we agree with the Examiner’s
finding that the combination of Brown and Lombardo teaches or suggests
the disputed “periodically determining” limitation of claim 1.
Limitation [L2] — “communicating” function
Appellant contends:
Because Appellant disagrees that the cited portions of Brown
disclose the “determining . . . whether the selected guaranteed
minimum rate of return is expected to be met by the target date”
feature of Claim 1, it follows that Appellant also disagrees that
the cited portions of Brown disclose the “communicating for
display the determination whether the selected guaranteed
minimum rate of return is expected to be met" feature of
Claim 1. In particular, the cited portions of Brown do not
disclose determining whether the selected guaranteed minimum
rate of return is expected to be met, and thus the cited portions
of Brown do not disclose communicating such determination
for display.
Appeal Br. 15.
We are not persuaded by Appellant’s argument because we find it is
based upon a faulty premise, i.e., that the combination of Brown and
Lombardo actually does not teach or suggest the disputed “periodically
determining” limitation. We are not persuaded for the reasons discussed
above with respect to Limitation L1.
Moreover, we agree with the Examiner’s finding that “it would have
been obvious to communicate the above using a computer.” Ans. 13 (citing
Brown ¶¶ 20, 21, and 29). The Examiner further determined:
[The] Examiner notes that it would not be possible for
the annuity company (Allianz) to fulfil its obligations to its
clients without actually keeping track of the returns and
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comparing them. In order to track the returns, they would have
to obtain/print/view return information. And, in order to view
the comparative returns of the account and target value fund, on
a computer, such information would obviously have to be
displayed on a screen. The act of communicating for display
may be as simple as presenting Table 1 on the computer display
for the insurance company administrators to view the relative
returns of investor account and target value fund.
Ans. 13.
Therefore, based upon the findings above, on this record, we are not
persuaded of error in the Examiner’s reliance on the cited prior art
combination to teach or suggest the disputed limitation of claim 1, nor do we
find error in the Examiner’s resulting legal conclusion of obviousness.
Therefore, we sustain the Examiner’s obviousness rejection of
independent claim 1, and grouped claims 4–8, 11–14, and 17–20, which fall
therewith. See Claim Grouping, supra.
REPLY BRIEF
To the extent Appellant may advance new arguments in the Reply
Brief (Reply Br. 2–6) not in response to a shift in the Examiner’s position in
the Answer, arguments raised in a Reply Brief that were not raised in the
Appeal Brief or are not responsive to arguments raised in the Examiner’s
Answer will not be considered except for good cause (see 37 C.F.R.
§ 41.41(b)(2)), which Appellant has not shown.
CONCLUSIONS
(1) Under our Revised Guidance, governed by relevant case law,
claims 1, 4–8, 11–14, and 17–20 in Rejection R1 are patent-ineligible under
35 U.S.C. § 101,and we sustain the rejection.
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(2) The Examiner did not err with respect to obviousness Rejection
R2 of claims 1, 4–8, 11–14, and 17–20 under 35 U.S.C. § 103(a) over the
cited prior art combination of record, and we sustain the rejection.
DECISION SUMMARY
Claims
Rejected
35 U.S.C.
§
References/
Basis
Affirmed Reversed
1, 4–8, 11–14,
17–20
101 Subject Matter
Ineligibility
1, 4–8, 11–14,
17–20

1, 4–8, 11–14,
17–20
103(a) Brown,
Lombardo
1, 4–8, 11–14,
17–20

Overall
Outcome
1, 4–8, 11–14,
17–20

FINALITY AND 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)(1)(iv). See 37
C.F.R. § 41.50(f).
AFFIRMED