Ex Parte Armand et al

Board of Patent Appeals and Interferences

Jul 19, 2012

11437364 (B.P.A.I. Jul. 19, 2012)

UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE BOARD OF PATENT APPEALS
AND INTERFERENCES
____________

Ex parte GLEN ARMAND and LAWRENCE J. EISENBERG
____________

Appeal 2011-000714
Application 11/437,364
Technology Center 3600
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Before: BIBHU R. MOHANTY, MEREDITH C. PETRAVICK, and
MICHAEL W. KIM, Administrative Patent Judges.

KIM, Administrative Patent Judge.

DECISION ON APPEAL
Appeal 2011-000714
Application 11/437,364

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STATEMENT OF THE CASE
This is an appeal from the final rejection of claims 1-5 and 7-35. We
have jurisdiction to review the case under 35 U.S.C. §§ 134 and 6 (2002).
The claimed invention relates to investment vehicles, and more
particularly to facilitating the funding and administration of a long term
investment and/or retirement trust on behalf of young individuals (Spec. 1:5-
7 ). Claim 1, reproduced below, is further illustrative of the claimed subject
matter.
1. A system for facilitating the modeling of long term
investment options or retirement trust options on behalf of a minor
child, comprising:
an input component receiving, from a trust grantor, a type
selection of defined benefit or defined contribution, a contribution
form selection of single lump sum or lump sum plus at least one
additional contribution, a benefit form selection of lump sum or
annuitized, core funding elements including at least the amount of
a targeted benefit or contribution, an age of the beneficiary at the
time of funding and a targeted age of the beneficiary at retirement,
the input component further capable of receiving an initial
investment from the grantor pertaining to the contribution form
selection;
an investment options evaluation component for
determining at least one trust investment option based upon said
selected type, selected form, and core funding elements; and
a trust creation component for generating a retirement trust
in real time based on a selection by the trust grantor of the at least
one trust investment option.

Claims 20-35 stand rejected under 35 U.S.C. § 101. Claims 1-5 and
7-35 stand rejected under 35 U.S.C. § 103(a) as unpatentable over Edelman
(US Pat. No. 6,064,986, iss. May 16, 2000; hereinafter “Edelman”) in view
of Dhar et al. (US Pub. No. 2002/0040339 A1, pub. Apr. 4, 2002; hereinafter
“Dhar”).
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We AFFIRM-IN-PART.

ISSUES
Did the Examiner err in asserting that claims 20-35 are directed to
unpatentable subject matter based on 35 U.S.C. § 101? The issue turns on
whether determination of a particular article, a trust investment option, and
transforming it into a retirement trust constitutes a transformation.
Did the Examiner err in asserting that a combination of Edelman and
Dhar renders obvious independent claim 1? The issues of non-obviousness
turn primarily on whether the references disclose the limitation of an
investment options evaluation component and a trust creation component.
Did the Examiner err in asserting that a combination of Edelman and
Dhar renders obvious independent claim 11? The issues of non-obviousness
turn primarily on whether Edelman discloses the investment modeling
component.
Did the Examiner err in asserting that a combination of Edelman and
Dhar renders obvious independent claim 20? The issues of non-obviousness
turn primarily on whether Edelman discloses the limitation of “a type
selection of defined benefit or defined contribution for the trust.”
Did the Examiner err in asserting that a combination of Edelman and
Dhar renders obvious independent claim 28? The issues of non-obviousness
turn primarily on whether Edelman discloses the limitations of receiving a
trust investment selection from a trust grantor, receiving initial trust funding,
and storing trust terms and the first amount.
Did the Examiner err in asserting that a combination of Edelman and
Dhar renders obvious dependent claims 2-5, 18, 27, and 35? The issues of
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non-obviousness turn primarily on whether Edelman discloses an investment
evaluation component and “prohibit[ing the] investment … evaluation
component from determining an investment option that” requires or includes
various options defined in the dependent claims.
Did the Examiner err in asserting that a combination of Edelman and
Dhar renders obvious dependent claims 7 and 31? The issues of non-
obviousness turn primarily on whether Edelman discloses “a trust
monitoring component for periodically monitoring the credit quality of a
trust underwriter and other items.” Did the Examiner err in asserting that a
combination of Edelman and Dhar renders obvious dependent claims 8, 30,
and 34? The issues of non-obviousness turn primarily on whether Edelman
discloses the limitation of including a withdrawal channel which allows an
affinity program, round-up program, or vendor rebate program to deposit
funds into the trust.

FINDINGS OF FACT
Edelman
FF1. Edelman discloses that a prospective client calls an Attorney.
The Attorney evaluates the client’s needs, and creates a Trust for the client
(col. 36, ll. 31-35). The client funds the Trust by making a one-time
contribution (minimum $5,000) for the benefit of the child selected by the
client (col. 36, ll. 47-49).
FF2. Edelman illustrates the impact of tax-deferred investments on
the value of a trust (col. 26, ll. 59 to col. 27, ll. 17 and Fig. 18). Edelman
also discloses that a grantor can use a chart and worksheet to determine how
much to contribute to a beneficiary’s trust (col. 27, ll. 27-32 and Fig. 19).
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FF3. Edelman discloses that retirement plans are known as defined
contribution plans, which are the exact opposite of defined benefit plans,
where the result is known but the amount that needs to be contributed is not
(col. 1, ll. 66 to col. 2, ll. 3). Edelman also teaches that company retirement
plans generally involve either a Simplified Employee Pension Plan or the
401(k) plan (col. 2, ll. 10-11).
FF4. Edelman discloses receiving a request from the customer to
administer resources in accordance with predetermined investment and
withdrawal criteria, and storing customer related data associated with the
customer (col. 10, ll. 50-60). Edelman also discloses investing $5,000 for a
new born beneficiary in the program by a grantor (col. 10, ll. 31-34 and col.
23, ll. 12-18).
FF5. Edelman discloses that a central computer conducts the
management information reporting operation and the period-by-period
investment performance monitoring operation (col. 30, ll. 27-35).

Dhar
FF6. Dhar discloses a real-time loan approval system (para. [0045]).
Dhar also discloses providing loan application forms dynamically over a
web site interface (para. [0049]). Additionally, Dhar teaches generating and
displaying instant loan offers to consumers over a web page (para. [0104]
and Fig. 7).

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ANALYSIS
101 Rejection
The Examiner references the machine-or-transformation test in
rejecting claims 20-35 (Exam’r’s Ans. 8, 19-20). The Supreme Court has
clarified in Bilski that while the machine-or-transformation test “is not the
sole test for deciding whether an invention is a patent-eligible ‘process'
under § 101,” it remains a “useful and important clue or investigative tool.”
Bilski v. Kappos, 130 S. Ct. 3218, 3221 (2010). We conclude that absent
any other factors weighing either toward or against patent eligibility, the
only factors being considered in front of us are the two machine-or-
transformation factors, both weighing against patent eligibility.
Claims 20-35 recite a method for modeling options for a long term
investment or retirement trust on behalf of a minor child. None of the
claimed steps are tied to being performed via a machine, and the Appellants
do not argue this assertion. Appellants instead argue that the claims recite
“the determination of a particular article, a trust investment option, and
transforming it into a different thing, a retirement trust” (App. Br. 7). We
are not persuaded by the Appellants’ argument, because the method does not
transform a physical object or substance. Contrary to Appellants’
arguments, the recited trusts and related aspects are merely abstract ideas.
Independent claim 20 recites utilizing one type of information (i.e., inputs)
to generate another type of information (i.e., a trust document). Gottschalk
v. Benson, 409 U.S. 63, 72 (1972) prevents the patenting of a computer
based algorithm that merely transforms data from one form to another, as
such a “patent would wholly pre-empt the mathematical formula and in
practical effect would be a patent on the algorithm itself.”
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Independent Claim 1
We are not persuaded the Examiner erred in asserting that a
combination of Edelman and Dhar renders obvious independent claim 1.
Appellants assert that Edelman does not disclose an investment options
evaluation component and a trust creation component (App. Br. 10 and 11).
However, Edelman teaches evaluating a client’s needs and creating a trust
for the client (FF1). Additionally, Dhar teaches generating documents with
various subcomponents in real-time based on user input (FF6). Accordingly,
the Examiner has substituted the generic documents in Dhar with the trusts
of Edelman, so as to “provide a system for the grantor to interact with the
system (10) over the Internet, and the bank hosts the web site interface,
controls the various instruments available to the consumer, and administers
the system (10) via an Intranet backbone” (Exam’r’s Ans. 10). Appellants
have not attacked the substance of this rationale. See In re Keller, 642 F.2d
413, 425 (CCPA 1981) (“[o]nce a prima facie case of obviousness [is]
established..., the burden shift[s] to appellant to rebut it”). We remind
Appellants that “one cannot show non-obviousness by attacking references
individually where, as here, the rejections are based on combinations of
references.” Keller, 642 F.2d at 426; In re Merck & Co., Inc., 800 F.2d
1091, 1097 (Fed. Cir. 1986) (the argument that a single reference alone does
not disclose the recited claimed steps is not persuasive because
nonobviousness cannot be established by attacking the references
individually when the rejection is predicated upon a combination of prior art
disclosures). According to the Examiner’s line of reasoning in the Answer
(Exam’r’s Ans. 21-22), the basis for the obviousness rejection is the
combination of Edelman and Dhar. We also note that the exemplary list of
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KSR rationales is not exhaustive, and “[u]nder the correct analysis, any need
or problem known in the field of endeavor at the time of invention and
addressed by the patent can provide a reason for combining the elements in
the manner claimed.” See KSR Int’l Co. v. Teleflex, Inc., 550 U.S. 398, 419-
20 (2007). Additionally, generating a trust is a process that can be done
entirely by a human mind using a piece of paper and pencil, and “[i]t is well
settled that it is not ‘invention’ to broadly provide a mechanical or automatic
means to replace manual activity which has accomplished the same result.”
In re Venner, 262 F.2d 91, 95 (CCPA 1958) (citing In re Rundell, 48 F.2d
958, 959 (CCPA 1931)). In other words, since Edelman teaches evaluating a
client’s needs and creating a trust for the client (FF1), the automation of
these activities into computerized “components” is obvious, especially in
view of the computerizing of subcomponents in Dhar.
This analysis is also applicable to the corresponding arguments set
forth by Appellants with respect to independent claims 11, 20, and 28.

Independent Claim 11
We are not persuaded the Examiner erred in asserting that a
combination of Edelman and Dhar renders obvious independent claim 11.
Appellants assert that Edelman does not disclose the investment modeling
component (App. Br. 19). However, Edelman teaches that a grantor can
utilize a chart and worksheet to determine how much to contribute to a
beneficiary’s trust and the impact of tax-deferred investments on the value of
a trust (FF2). Regarding Appellants’ argument concerning “defined benefit
[vs.] defined contribution,” such an aspect is not set forth in the claims.

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Independent Claim 20
We are not persuaded the Examiner erred in asserting that a
combination of Edelman and Dhar renders obvious independent claim 20.
Appellants assert that Edelman does not disclose “a type selection of defined
benefit or defined contribution for the trust” (App. Br. 20-21). Since this is
an alternative limitation, the Examiner only has the burden of finding either
a defined benefit or a defined contribution plan. Edelman teaches a defined
contribution plan whereby the grantor makes a one-time contribution to a
trust for the benefit of the beneficiary (FF1). While Appellants argue
temporal aspects concerning the type selection, such an aspect is not set
forth in independent claim 20. Furthermore, Edelman teaches both a defined
benefit and a defined contribution plan (FF1 and FF3).

Independent Claim 28
We are not persuaded the Examiner erred in asserting that a
combination of Edelman and Dhar renders obvious independent claim 28.
Appellants assert that Edelman does not disclose receiving a “designation of
at least one investment vehicle and at least one trust underwriter” from a
trust grantor, receiving initial trust funding, and storing trust terms and the
first amount (App. Br. 21-22). However, Edelman teaches a resource
administrative program (underwriter) receiving a request from the customer
to administer resources in accordance with predetermined investment and
withdrawal criteria (investment vehicle), receiving an initial investment from
the grantor, and storing customer related data, which would include resource
terms and amounts (FF1, FF4).

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Appellants assert that the combination of Edelman with Dhar is
unsupported by the KSR rationales (App. Br. 12-19). Since the Examiner is
not relying on these KSR rationales for the claim rejections, this argument is
irrelevant. Additionally, as we stated before, the exemplary list of KSR
rationales is not exhaustive, and “[u]nder the correct analysis, any need or
problem known in the field of endeavor at the time of invention and
addressed by the patent can provide a reason for combining the elements in
the manner claimed.” KSR at 420.

Dependent Claims 2-5, 18, 27, and 35
We are persuaded the Examiner erred in asserting that a combination
of Edelman and Dhar renders obvious dependent claims 2-5, 18, 27, and 35.
The Appellants assert that Edelman does not disclose an investment
evaluation component and “prohibit[ing the] investment … evaluation
component from determining an investment option that” requires or includes
various options defined in the dependent claims. (App. Br. 22-24). With
respect to this argument, we find that Edelman discloses an investment
evaluation component, since it discloses an Attorney evaluating a client’s
needs and creating a trust for the client (FF1). However, we agree with the
Appellants that these cited portions of Edelman do not disclose “prohibit[ing
the] investment … evaluation component from determining an investment
option that” requires or includes various options defined in the dependent
claims. Accordingly, we will not sustain these rejections.

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Dependent Claims 7 and 31
We are persuaded the Examiner erred in asserting that a combination
of Edelman and Dhar renders obvious dependent claims 7 and 31. The
Appellants assert that Edelman does not disclose “a trust monitoring
component for periodically monitoring the credit quality of a trust
underwriter and other items” (App. Br. 24). With respect to this argument,
we agree with the Examiner that Edelman discloses a trust monitoring
component for periodically monitoring (App. Br. 24), since it discloses a
computer that conducts the information reporting operation and the period-
by-period investment performance monitoring operation for a trust (FF5).
However, we agree with the Appellants that these cited portions of Edelman
do not disclose “periodically monitoring the credit quality of a trust
underwriter and other items.” Accordingly, we will not sustain these
rejections.

Dependent claims 8, 30, and 34
We are persuaded the Examiner erred in asserting that a combination
of Edelman and Dhar renders obvious dependent claims 8, 30, and 34 (App.
Br. 24-25). These dependent claims recite providing additional trust funding
amounts by “an affinity program, round-up program or vendor rebate
program.” The Examiner cites column 12, lines 10-21 of Edelman and
paragraph [0130] of Dhar as disclosing these aspects (Exam’r’s Ans. 11, 17,
18). We agree with the Appellants that the cited portions of Edelman and
Dhar respectively refer only to an escrow account and third party providers,
which, without more, are not enough to correspond to the claimed programs
(App. Br. 25). Accordingly, we will not sustain these rejections.
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DECISION
The decision of the Examiner to reject claims 1, 9-17, 19-26, 28, 29,
32, and 33 is AFFIRMED.
The decision of the Examiner to reject claims 2-5, 7, 8, 18, 27, 30, 31,
34, and 35 is REVERSED.
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-IN-PART

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