CFPH, LLCDownload PDFPatent Trials and Appeals BoardJun 2, 20212019005539 (P.T.A.B. Jun. 2, 2021) Copy Citation UNITED STATES PATENT AND TRADEMARK OFFICE UNITED STATES DEPARTMENT OF COMMERCE United States Patent and Trademark Office Address: COMMISSIONER FOR PATENTS P.O. Box 1450 Alexandria, Virginia 22313-1450 www.uspto.gov APPLICATION NO. FILING DATE FIRST NAMED INVENTOR ATTORNEY DOCKET NO. CONFIRMATION NO. 14/576,995 12/19/2014 James R. Driscoll 07-2112-C2 7292 63710 7590 06/02/2021 INNOVATION DIVISION CANTOR FITZGERALD, L.P. 110 EAST 59TH STREET (6TH FLOOR) NEW YORK, NY 10022 EXAMINER KALINOWSKI, ALEXANDER G ART UNIT PAPER NUMBER 3691 NOTIFICATION DATE DELIVERY MODE 06/02/2021 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): lkorovich@cantor.com mcatarino@cgolaw.com patentdocketing@cantor.com PTOL-90A (Rev. 04/07) UNITED STATES PATENT AND TRADEMARK OFFICE ____________ BEFORE THE PATENT TRIAL AND APPEAL BOARD ____________ Ex parte JAMES R. DRISCOLL and MATTHEW W. CLAUS1 ____________ Appeal 2019-005539 Application 14/576,995 Technology Center 3600 ____________ Before CARL W. WHITEHEAD JR., JEFFREY S. SMITH, and PHILLIP A. BENNETT, Administrative Patent Judges. SMITH, Administrative Patent Judge. DECISION ON APPEAL 1 We use “Appellant” to refer to “applicant” as defined in 37 C.F.R. § 1.42. Appellant identifies BGC Partners, Inc. as the real party in interest. Appeal Br. 3. Appeal 2019-005539 Application 14/576,995 2 STATEMENT OF THE CASE This is an appeal under 35 U.S.C. § 134(a) from the Examiner’s final rejection of claims 33–38, 40, and 41, which are all claims remaining in the application. See Appeal Br. 6. We have jurisdiction under 35 U.S.C. § 6(b). We affirm. Illustrative Claim Claim 33 is independent, and recites: 33. A method for correcting network delays in a trading system, in which the method comprises: transmitting, by at least one processor, data indicative of a of a bid or offer to an electronic trading system; transmitting, by the at least one processor, a request to cancel the bid or offer; receiving, by the at least one processor, an indication that the request to cancel was unsuccessful as a result of the bid or offer having already been matched,; computing, by the at least one processor, a lag time between when the request to cancel was submitted and when the request to cancel was received by the trading system; and adjusting, by the at least one processor, at least one trading algorithm based at least in part on the lag time so as to improve a response time to any future requests to cancel. Examiner’s Rejection Claims 33–38, 40, and 41 stand rejected under 35 U.S.C. § 101 as directed to patent ineligible subject matter. Appeal 2019-005539 Application 14/576,995 3 ANALYSIS The Examiner determines that the claims are directed to a method of receiving a request, determining a lag time, and adjusting an algorithm based on the lag time, which amounts to an abstract idea without significantly more. Final Act. 4; see Alice Corp. v. CLS Bank Int’l, 573 U.S. 208, 217 (2014) (describing the two-step framework “for distinguishing patents that claim laws of nature, natural phenomena, and abstract ideas from those that claim patent-eligible applications of those concepts.”). The USPTO published revised guidance on the application of § 101. 2019 Revised Patent Subject Matter Eligibility Guidance, 84 Fed. Reg. 50 (January 7, 2019) (hereinafter “Memorandum”).2 Under the Memorandum, the Office first looks to whether the claim recites: (1) any judicial exceptions, including certain groupings of abstract ideas (i.e., (a) mathematical concepts, (b) certain methods of organizing human activity such as a fundamental economic principles and practice, commercial or legal interactions, managing personal behavior, relationships, interpersonal interactions, (c) mental processes); and (2) additional elements that integrate the judicial exception into a practical application (see MPEP § 2106.05(a)–(c), (e)–(h) (9th ed. 2018). 2 In January 2019, the United States Patent and Trademark Office (“USPTO”) published revised guidance on the application of 35 U.S.C. § 101. 2019 Revised Patent Subject Matter Eligibility Guidance, 84 Fed. Reg. 50 (January 7, 2019) (“2019 Guidance”), updated by USPTO, October 2019 Update: Subject Matter Eligibility (available at https://www.uspto.gov/ sites/default/files/documents/peg_oct_2019_update.pdf) (jointly referred to as “the 2019 Guidance”); see also October 2019 Patent Eligibility Guidance Update, 84 Fed. Reg. 55942 (October 18, 2019) (notifying the public of the availability of the October update). Appeal 2019-005539 Application 14/576,995 4 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: (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. See Memorandum. Appellant contends that independent claim 33 integrates the abstract idea into a practical application, because it improves the functioning of the computer by ensuring that a canceled bid does not fail due to network latency. Appeal Br. 8. Appellant contends that the claimed solution is necessarily rooted in computer technology by providing a solution to the problem of requests canceled due to network latency. Appeal Br. 9. Appellant’s arguments are not persuasive. Instead, pursuant to Step 2A of the Memorandum, we agree with the Examiner’s determination that the claims are directed to an abstract idea. Final Act. 4; Memorandum, Section III(A) (Revised Step 2A). Alice/Mayo—Step 1 (Abstract Idea) Step 2A–Prongs 1 and 2 identified in the Memorandum Step 2A, Prong One The Specification discloses: It will be readily apparent to one of ordinary skill in the art that the various processes described herein may be implemented by, e.g., appropriately programmed general purpose computers, special purpose computers and computing devices. Typically a processor (e.g., one or more microprocessors, one or more Appeal 2019-005539 Application 14/576,995 5 microcontrollers, one or more digital signal processors) will receive instructions (e.g., from a memory or like device), and execute those instructions, thereby performing one or more processes defined by those instructions. Instructions may be embodied in, e.g., a computer program. Spec. ¶ 49. The Specification also discloses: Thus a description of a process is likewise a description of an apparatus for performing the process. The apparatus that performs the process can include, e.g., a processor and those input devices and output devices that are appropriate to perform the process. Id. at ¶ 51. The Specification also discloses: Such information may provide useful to a trader in a number of ways. For example, the system may indicate to a trader that for the past month, all of his requests to cancel have arrived, on average, 5 milliseconds after the exchange has formed a match between his previously submitted bid and a corresponding offer. The trader may use this information to modify his trading algorithm to react in a manner that compensate for this 5 millisecond lag time. In another example, the system indicates to the trader that his request to cancel arrived at the exchange a full minute after a match has been formed. Since requests typically arrive at an exchange within very small increments of time (e.g., milliseconds), this information alerts the trader to a potential problem in its transmission system. For example, an internet line may be down, thus resulting in a slow transmission time. Id. at ¶ 100. Claim 33 recites: 33. A method for correcting network delays in a trading system, in which the method comprises: transmitting, by at least one processor, data indicative of a of a bid or offer to an electronic trading system; transmitting, by the at least one processor, a request to cancel the bid or offer; Appeal 2019-005539 Application 14/576,995 6 receiving, by the at least one processor, an indication that the request to cancel was unsuccessful as a result of the bid or offer having already been matched,; computing, by the at least one processor, a lag time between when the request to cancel was submitted and when the request to cancel was received by the trading system; and adjusting, by the at least one processor, at least one trading algorithm based at least in part on the lag time so as to improve a response time to any future requests to cancel. The claimed steps recite certain methods of organizing human activity of commercial or legal interactions (including agreements in the form of contracts). For example, the steps of “transmit[] . . . a bid or offer,” “transmit[] . . . a request to cancel the bid or offer,” “receiv[e] . . . an indication that the request to cancel was unsuccessful,” “comput[e] . . . a lag time between when the request to cancel was submitted and when the request to cancel was received,” and “adjust[] . . . at least one trading algorithm . . . to improve a response time to any future requests to cancel” organize the human activity of a person canceling a commercial trade of securities. See Spec. ¶ 98. Thus, the claim recites the abstract idea of “certain methods of organizing human activity” such as trading securities. See Memorandum, Section I (Groupings of Abstract Ideas); see also Spec. ¶¶ 97–111. Therefore, we conclude the claims recite an abstract idea pursuant to Step 2A, Prong One of the guidance. See Memorandum, Section III(A)(1) (Prong One: Evaluate Whether the Claim Recites a Judicial Exception). Appeal 2019-005539 Application 14/576,995 7 Step 2A, Prong Two Under Prong Two of the Memorandum, we must determine “whether the claim as a whole integrates the recited judicial exception into a practical application of the exception”; it is noted that a “claim that integrates a judicial exception into a practical application will apply, rely on, or use the judicial exception in a manner that imposes a meaningful limit on the judicial exception, such that the claim is more than a drafting effort designed to monopolize the judicial exception.” Memorandum, Section III(A)(2). Appellant argues that the claims in the instant application are “directed to a technical improvement to a technical problem (i.e., cancelation requests fail . . . due to network latency),” which “is necessarily rooted in computer technology in order to overcome a problem specifically arising in the realm of computer networks.” Appeal Br. 9 (emphasis omitted) (citing DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245 (Fed. Cir. 2014)). Appeal Br. 14. We do not find Appellant’s arguments persuasive. We find Appellant’s claims are distinguished from those of DDR Holdings. Here, the recited limitations do not reflect an improvement in the functioning of a computer or other technology or technical field. Rather, in Appellant’s claims, the network latency is computed, but not reduced or eliminated. The claims only make the trader more efficient. See Memorandum, 84 Fed. Reg. at 55; cf. Trading Techs. Int’l, Inc. v. IBG LLC, 921 F.3d 1084, 1090 (Fed. Cir. 2019) (“This invention makes the trader faster and more efficient, not the computer. This is not a technical solution to a technical problem.”). Further, we do not find Appellant’s arguments persuasive because the claims utilize general purpose hardware and networking as a tool to perform securities trades. See Specification ¶¶ 86–91; see also Enfish, LLC v. Appeal 2019-005539 Application 14/576,995 8 Microsoft Corp., 822 F.3d 1327, 1335–36 (Fed. Cir. 2016) (“[W]e find it relevant to ask whether the claims are directed to an improvement to computer functionality versus being directed to . . . a process that qualifies as an ‘abstract idea’ for which computers are invoked merely as a tool.”); Intellectual Ventures I LLC v. Capital One Bank (USA), 792 F.3d at 1370 (“[M]erely adding computer functionality to increase the speed or efficiency of the process does not confer patent eligibility on an otherwise abstract idea.”). Subsequently, we detect no additional element (or combination of elements) recited in claim 33 that integrates the judicial exception into a practical application. See Memorandum, Section III(A)(2). For example, Appellant’s claimed additional elements (e.g., the preamble recitation of “network delays” and “at least one processor” recited in the body) do not: (1) improve the functioning of a computer or other technology; (2) are not applied with any particular machine (except for generic hardware); (3) do not effect a 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). Accordingly, we determine the claims do not integrate the recited judicial exception into a practical application. See Memorandum, Section III(A)(2) (Prong Two: If the Claim Recites a Judicial Exception, Evaluate Whether the Judicial Exception Is Integrated Into a Practical Application). Appeal 2019-005539 Application 14/576,995 9 Alice/Mayo—Step 2 (Inventive Concept) Step 2B identified in the Memorandum Step 2B Next, we determine whether the claims include additional elements that provide significantly more than the recited judicial exception, thereby providing an inventive concept. Alice, 573 U.S. at 217–18 (quoting Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66, 72–73 (2012)). Appellant contends that the Final Action fails to meet the Berkheimer guidelines and completely ignores the technical advantages discussed in the Specification. Appeal Br. 10. The Examiner finds: The limitations of transmitting by a processor data indicative of a bid or offer, transmitting a request to cancel the bid are interpreted as generic data gathering over a network and therefore not significantly more, See Applicant's specification paragraphs 49-59. The limitations claimed do not qualify as significantly more as the implementation is generic, on generic hardware and therefore does not perform functions that are not routine, conventional and well understood. Final Act. 5; see Ans. 6–9. Consequently, we agree with the Examiner’s findings that the additional claim elements are well-understood, routine, and conventional, and are properly based upon a factual determination as specified in the Berkheimer Memorandum,3 Section III (A)(2). See Final Act. 4–6. We sustain the rejection of claims 33–38, 40, and 41 under 35 U.S.C. § 101. 3 Memorandum on Changes in Examination Procedure Pertaining to Subject Matter Eligibility, April 19, 2018. Appeal 2019-005539 Application 14/576,995 10 DECISION The Examiner’s rejection under 35 U.S.C. § 101 is affirmed. DECISION SUMMARY In summary: Claims Rejected 35 U.S.C. § Reference(s)/ Basis Affirmed Reversed 33–38, 40, 41 101 Eligibility 33–38, 40, 41 Overall Outcome 33–38, 40, 41 TIME PERIOD FOR RESPONSE No time period for taking any subsequent action in connection with this appeal may be extended under 37 C.F.R. § 1.136(a). See 37 C.F.R. § 1.136(a)(1)(iv). AFFIRMED Copy with citationCopy as parenthetical citation