Ex Parte Claus et al

Patent Trial and Appeal Board

Aug 27, 2018

13621231 (P.T.A.B. Aug. 27, 2018)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE
13/621,231 09/15/2012
63710 7590 08/29/2018
INNOVATION DIVISION
CANTOR FITZGERALD, L.P.
110 EAST 59TH STREET (6TH FLOOR)
NEW YORK, NY 10022
FIRST NAMED INVENTOR
Matthew W. Claus
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
ATTORNEY DOCKET NO. CONFIRMATION NO.
05-6287-C4 7426
EXAMINER
KHATTAR, RAJESH
ART UNIT PAPER NUMBER
3693
NOTIFICATION DATE DELIVERY MODE
08/29/2018 ELECTRONIC
Please find below and/or attached an Office communication concerning this application or proceeding.
The time period for reply, if any, is set in the attached communication.
Notice of the Office communication was sent electronically on above-indicated "Notification Date" to the
following e-mail address(es):
patentdocketing@cantor.com
lkorovich@cantor.com
phowe@cantor.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte MATTHEW W. CLAUS, JAMES R. DRISCOLL,
GREGORY P. MANNING, and JOSEPH C. NOVIELLO
Appeal2017-000589
Application 13/621,231 1
Technology Center 3600
Before MURRIEL E. CRAWFORD, HUBERT C. LORIN, and
MATTHEWS. MEYERS, Administrative Patent Judges.
LORIN, Administrative Patent Judge.
DECISION ON APPEAL
STATEMENT OF THE CASE
Matthew W. Claus et al. ("Appellants") seek our review under
35 U.S.C. § 134(a) from the Final Rejection of claims 1-11, 13-18, 37, and
38. We have jurisdiction under 35 U.S.C. § 6(b). 2
SUMMARY OF DECISION
We AFFIRM.
1 The Appellants identify BGC Partners, Inc. as the real party in interest.
App. Br. 2.
2 The Appellants elected to waive their Request for Oral Hearing.
Appeal2017-000589
Application 13/621,231
THE INVENTION
Claim 13, reproduced below, is illustrative of the subject matter on
appeal.
13. A method for processing a composite trading order,
compnsmg:
causing to be displayed on a display device, by at least
one computer processor, a composite value representing a
weighted quantity associated with a plurality of different but
related trading products that are currently available to trade in a
plurality of market centers; and
receiving, by the at least one computer processor, at least
one input representing a composite trading order that could be
satisfied by a plurality of quantities of the plurality of trading
products, wherein:
the plurality of quantities of the plurality of trading
products are collectively substantially equivalent to one
another in at least one performance metric;
the composite trading order corresponds to at least
a portion of the composite value such that satisfying the
composite trading order would satisfy the at least portion
of the composite value;
the at least one input comprises a quantity that is
equal to at least a portion of the weighted quantity;
the at least one input does not identify any specific
one of the plurality of trading products but is usable to
generate at least two constituent trading orders for
quantities of one or more of the plurality of trading
products that, when filled, combine to satisfy the
composite trading order; and
the at least two constituent trading orders comprise
at least one of the plurality of quantities of the plurality
of trading products.
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Application 13/621,231
THE REJECTION
The following rejection is before us for review:
Claims 1-11, 13-18, 37, and 38 are rejected under 35 U.S.C. § 101 as
being directed to judicially-excepted subject matter.
ISSUE
Did the Examiner err in rejecting claims 1-11, 13-18, 37, and 38
under 35 U.S.C. § 101 as being directed to judicially-excepted subject
matter.
ANALYSIS
The Appellants argued these claims in the "First Group." See App.
Br. 6. We select claim 13 as the representative claim for this group (it is
reproduced at page 9), and the remaining claims 1-11, 14--18, 37, and 38
stand or fall with claim 13. 3 7 C.F .R. § 41.3 7 ( c )(1 )(iv). We are cognizant of
the "Second" through "Nineteenth" groups whereby each claim is
separately mentioned. App. Br. 14-16 (e.g., claim 13 is also addressed in the
"Second Group" (App. Br. 14: "The same or similar arguments to those
presented above for independent claim 1 similarly apply to independent
claim 13, .... ")). However, as we repeat below, the discussion relative these
other "Groups" do little more than mention each claim and then rely on the
arguments challenging the patent-ineligibility of claim 1. Claim 13, which is
a method claim, parallels claim 1, which is an apparatus claim. Claim 1 is no
different from claim 13 in substance because it recites a handful of generic
computer components configured to implement the method of claim 13.
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Alice Corp. Pty. Ltd. v. CLS Bankint'l, 134 S. Ct. 2347 (2014)
identifies a two-step framework for determining whether claimed subject
matter is judicially-excepted from patent eligibility under § 101.
According to Alice step one, "[ w ]e must first determine whether the
claims at issue are directed to a patent-ineligible concept," such as an
abstract idea. Id. at 2355.
In that regard, the Examiner determined that "[c]laims 1-11, 13-18
and 37-39 are directed to a series of steps instructing how to process a
composite trading order which is a method of organizing human activities
and a fundamental economic practice long prevalent in the history of
commerce." Final Act. 2.
The Appellants argue that "[t]he Office Action fails to identify even a
single specific recitation that recites the 'steps instructing how to process a
composite trading order,' .... "App.Br. 7. From a plain reading of the
claim, we see it recited in the preamble ("method for processing a composite
trading order") followed by the steps of "causing to be displayed ... a
composite value" and "receiving ... at least one input." See Two-Way
Media Ltd. v. Comcast Cable Communications, LLC, 874 F.3d 1329, 1340
(Fed. Cir. 2017) ("First, we see no error here in the district court citing to the
preamble in its review of whether the claims are directed to an abstract idea.
See, e.g., Bascom Global Internet Servs., Inc. v. AT&T Mobility LLC, 827
F.3d 1341, 1348 (Fed. Cir. 2016) (citing preamble for distillation of abstract
idea). The district court's inquiry centered on determining the 'focus' of the
claims, and was thus in accord with our precedent. E.g., Elec. Power Grp.
[LLC v. Alstom S.A., 830 F.3d 1350, 1353 (Fed. Cir. 2016)].")
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The Appellants further argue that "[ t ]he Office Action also fails to
establish that the alleged abstract idea of 'steps instructing how to process a
composite trading order' is, in fact, abstract." App. Br. 7. In that regard,
"the decisional mechanism courts now apply [to help answer that question]
is to examine earlier cases in which a similar or parallel descriptive nature
can be seen-what prior cases were about, and which way they were
decided." Amdocs (Israel) Ltd. v. Openet Telecom, Inc., 841 F.3d 1288,
1294 (Fed. Cir. 2016). In accord with that mechanism, Int 'l Securities
Exchange, LLC v. Chicago Bd. Options Exchange, Inc., 2015 WL 930204
(PTAB Mar. 2, 2015), aff'd, 640 Fed. App'x 986 (Mem) (Fed. Cir. 2016) is
one such case. The claims involved therein are similar3 and were
determined to be patent-ineligible for being directed to the abstract idea of
3 E.g., claim 1 of US 8,266,044: "1. A system for processing trades of
securitized instruments based on security orders and quotes received from
client computers, comprising: at least one server computer comprising a
memory, and a processor, said server computer configured to perform the
steps of: receiving orders and quotes, wherein specified ones of said quotes
belong to a quote group, and wherein said specified ones of said quotes have
associated trading parameters comprising a predefined number of bought or
sold contracts relating to said quote group; generating a trade by matching
said received orders and quotes to previously received orders and quotes;
storing each of said orders and quotes when a trade is not generated;
determining whether a quote having associated trading parameters has been
filled as a result of the generated trade, and if so, determining a number of
contracts that have been bought or sold within said quote group, including
the generated trade; comparing said number of contracts that have been
bought or sold within said quote group with said predefined number of
bought or sold contracts relating to said quote group; and, automatically
modifying at least one of the remaining specified ones of said quotes in the
quote group if said predefined number of bought or sold contracts is
exceeded."
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Application 13/621,231
"managing trading risk ('risk management')." Id. at 6. Albeit "steps
instructing how to process a composite trading order," per se, and
"managing trading risk ('risk management')" are different, for purposes of
determining whether the concept to which the claims are directed to is an
abstract idea, it is a difference in the level of abstraction at which the
concept is described. See Apple, Inc. v. Ameranth, Inc., 842 F.3d 1229,
1240-41 (Fed. Cir. 2016) ("An abstract idea can generally be described at
different levels of abstraction. As the Board has done, the claimed abstract
idea could be described as generating menus on a computer, or generating a
second menu from a first menu and sending the second menu to another
location. It could be described in other ways, including, as indicated in the
specification, taking orders from restaurant customers on a computer.")
"[S]teps instructing how to process a composite trading order" describes the
concept to which the claims are directed to at a very high level of
abstraction, but here the concept can also be characterized at a lower level of
abstraction similar to the "managing trading risk ('risk management')"
description given for the concept to which the Chicago Bd. Options
Exchange claims were determined to be directed to. For example, here the
concept could be described as a scheme for displaying and employing
composite values. See Spec. 3: 12-20. Arguably, "the heart of the claimed
invention lies [there] .... " Intellectual Ventures I LLC v. Erie Indemnity
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Co., 850 F.3d 1315, 1328 (Fed. Cir. 2017). 4 Nevertheless, when "the focus
of the asserted claims" is "on collecting information, analyzing it, and
displaying certain results of the collection and analysis," the claims are
directed to an abstract idea. Elec. Power Grp., 830 F.3d at 1353.
Accordingly, notwithstanding the Examiner characterized the abstract
idea to which the claims are directed to at a very high level of abstraction,
even if the concept is described at a lower level of abstraction ( e.g.,
displaying and employing composite values), the claims are nonetheless
"directed to an abstract idea" (App. Br. 7-8).
Appellants also challenge the Examiner's step one determination
under the rubric of "an improper overgeneralization of the claims." See id.
at 8-10. We do not, however, see it that way. Although the Examiner's
characterization of the concept to which the claim 13 is directed to may be at
a high level of abstraction, it is not incorrect. The Appellants do not explain
in what way claim 13 is not directed to an abstract idea, whether it be "steps
instructing how to process a composite trading order" or, more specifically,
a scheme for displaying and employing composite values. The Appellants'
additional limitations, like "a display device" (App. Br. 8), add a degree of
particularity. Notwithstanding that the question of whether additional
limitations such as "a display device" transforms the claimed subject matter
4 The "'directed to"' inquiry applies a stage-one filter to claims, considered
in light of the specification, based on whether "their character as a whole is
directed to excluded subject matter." Internet Patents Corp. v. Active
Network, Inc., 790 F.3d 1343, 1346 (Fed. Cir. 2015); see Genetic Techs. Ltd.
v. Merial L.L.C., 818 F.3d 1369, 1375 (Fed. Cir. 2016) (inquiring into "the
focus of the claimed advance over the prior art"); Enfzsh, LLC v. Microsoft
Corp., 822 F.3d 1327, 1335 (Fed. Cir. 2016).
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into an inventive application is better addressed as a step two matter, merely
adding "a degree of particularity" does not affect the first step of the Alice
analytical framework. Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 715
(Fed. Cir. 2014).
We have reviewed all the arguments as to the step one determination
but do not find them persuasive as to error in the determination that claim 13
is directed to an abstract idea.
Step two is "a search for an 'inventive concept'-i.e., an element or
combination of elements that is 'sufficient to ensure that the patent in
practice amounts to significantly more than a patent upon the [ineligible
concept] itself."' Alice, 134 S. Ct. at 2355 (alteration in original) (quoting
Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66, 72-73
(2012)).
In that regard, the Examiner determined that:
The claims do not include additional elements that are sufficient to
amount to significantly more than the judicial exception because the
additional elements make use of a computer in implementing the steps
of the claimed invention. In this case, the recited computer is a
generically computer elements and it does not add a meaningful
limitation because the computer merely implements the instructions of
the claimed invention. The use of a computer also does not improve
the functioning of a computer itself or include improvement to another
technology or a technical field.
Final Act. 2-3.
The Appellants argue that the Examiner failed "to identify any
additional elements and ... to explain why each additional element does
not add significantly more to the alleged abstract idea." App. Br. 10.
However, we are satisfied that the Examiner provided sufficient explanation
in this case. Claim 13 calls for "causing to be displayed on a display device,
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by at least one computer processor, a composite value ... " and "receiving,
by the at least one computer processor, at least one input representing a
composite trading order .... " Displaying and receiving are common
information-processing functions of generic computers, as the Examiner has
indicated. There is nothing in the claim to suggest that the scope of the
claimed subject matter precludes the use of a generic computer for doing so.
In fact, the intrinsic evidence supports the view that the scope of the claimed
subject matter covers the use of a generic computer, in line with the
Examiner's determination. See Spec. 9: 8-17 ("System 10 may comprise one
or more clients 14 .... [C]lient 14 may comprise a computer, workstation,
telephone, an Internet browser, an electronic notebook, a Personal Digital
Assistant (PDA), a pager, or any other suitable device (wireless or
otherwise) .... ")
The Appellants further argue that "[t]he claims recite significantly
more than the alleged abstract idea." App. Br. 12. However, other than
reproducing claim 13 (id. at 11 ), it is not entirely clear what the Appellants
are pointing to in the claim that transforms the abstract idea into an inventive
application. The Appellants state that "the exemplary recitations of claim 13
( quoted above) recite 'significantly more' than 'steps instructing how to
process a composite trading order."' Id. at 12. That is true. But the step
two determination does not depend on the number of words in the claim but
rather whether the claim includes an element or combination of elements
sufficient to ensure that the subject matter claimed in practice amounts to
significantly more than to be upon the abstract idea itself. As we have
shown, claim 13, is directed to steps instructing how to process a composite
trading order or, more specifically, a scheme or displaying and employing
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composite values, which are abstract ideas, while using a generic computer
as a conduit for implementing them. See In re TL! Commc 'ns LLC Patent
Litig., 823 F.3d 607, 612 (Fed. Cir. 2016) ("Put differently, the telephone
unit itself is merely a conduit for the abstract idea of classifying an image
and storing the image based on its classification. Indeed, the Specification
notes that it 'is known' that 'cellular telephones may be utilized for image
transmission,' id. at col. 1 11. 31-34, and existing telephone systems could
transmit pictures, audio, and motion pictures and also had 'graphical
annotation capability,' id. at col. 111. 52-59.") Cf Credit Acceptance Corp.
v. Westlake Servs., LLC, 859 F.3d 1044, 1057 (Fed. Cir. 2017):
Significantly, the claims do not provide details as to any non-
conventional software for enhancing the financing process. See
Intellectual Ventures I LLC v. Capital One Fin. Corp., 850 F.3d
1332, 1342 (Fed. Cir. 2017) (explaining that "[o]ur law
demands more" than claim language that "provides only a
result-oriented solution, with insufficient detail for how a
computer accomplishes it"); Elec. Power Grp., 830 F.3d at
1354 (explaining that claims are directed to an abstract idea
where they do not recite "any particular assertedly inventive
technology for performing [ conventional] functions").
For these reasons, the Appellants' arguments are unpersuasive as to error in
the Examiner's determination that the claim does not include an element or
combination of elements sufficient to ensure that the subject matter claimed
in practice amounts to significantly more than to be upon the abstract idea
itself.
We note the question "if the claim recitations ( alone or in
combination) do not recite 'significantly more' than a 'fundamental
economic practice,' then why are the claims deemed allowable over the art?"
App. Br. 12. But "a claim for a new abstract idea is still an abstract idea."
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Synopsys, Inc. v. Mentor Graphics Corp., 839 F.3d 1138, 1151 (Fed. Cir.
2016) (quoting Mayo, 566 U.S. at 90). The question in step two of the Alice
framework is not whether an additional feature is novel or nonobvious but
whether the implementation of the abstract idea involves "more than
performance of 'well-understood, routine, [and] conventional activities
previously known to the industry."' Content Extraction and Transmission
LLC v. Wells Fargo Bank, Nat. Ass 'n, 776 F.3d 1343, 1347--48 (Fed. Cir.
2014) (quoting Alice, 134 S. Ct. at 2359).
There is a statement that "[i]n any event, if the abstract idea is simply
'process[ing] a composite trading order,' then the claims do not preempt or
'tie down' all uses or ways of 'process[ing] a composite trading order."'
App. Br. 13. But"[ w ]hat matters is whether a claim threatens to subsume
the full scope of a fundamental concept, and when those concerns arise, we
must look for meaningful limitations that prevent the claim as a whole from
covering the concept's every practical application." CLS Bank Int 'l v. Alice
Corp. Pty. Ltd., 717 F.3d 1269, 1281 (Fed. Cir. 2013) (Lourie, J.,
concurring). Here, the additional words in the claim simply narrows the
abstract idea so that it is described at a lower level of abstraction. They do
not render the abstract idea to which the claim is directed to any less an
abstract idea. Also, pre-emption is not a separate test.
To be clear, the proper focus is not preemption per se, for some
measure of preemption is intrinsic in the statutory right granted with
every patent to exclude competitors, for a limited time, from
practicing the claimed invention. See 35 U.S.C. § 154. Rather, the
animating concern is that claims should not be coextensive with a
natural law, natural phenomenon, or abstract idea; a patent-eligible
claim must include one or more substantive limitations that, in the
words of the Supreme Court, add "significantly more" to the basic
principle, with the result that the claim covers significantly less. See
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Mayo[, 566 U.S. at 71-72]. Thus, broad claims do not necessarily
raise § 101 preemption concerns, and seemingly narrower claims are
not necessarily exempt.
Id.; see also Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371,
13 79 (Fed. Cir. 2015) ("[ w ]hile preemption may signal patent ineligible
subject matter, the absence of complete preemption does not demonstrate
patent eligibility."). Because we find the claimed subject matter covers
patent-ineligible subject matter, the pre-emption concern is necessarily
addressed. "Where a patent's claims are deemed only to disclose patent
ineligible subject matter under the Mayo framework, ... preemption
concerns are fully addressed and made moot." Ariosa Diagnostics, 788 F.3d
at 1379.
The Appellants further argue that
the present claims solve a problem rooted in computer technology to
improve the functionality of computer-implemented trading systems
by enabling traders to trade substitute trading products when a specific
trading product is not available, thereby enabling greater liquidity in
the electronic trading system. The claimed solution is necessarily
implemented in a networked computer environment due to the
networked communication between different electronic trading
systems and the fast calculations required to determine substantially
equivalent trading products in a fast-moving market.
App. Br. 14. Notwithstanding that claim 13 makes no mention of a
networked computer environment, nevertheless for the reasons discussed -
namely because the claimed subject matter covers employing generic
computers for their common functions - we are unpersuaded that claim 13
recites any particular assertedly inventive technology. See also Bancorp
Servs., L.L.C. v. Sun Life Assur. Co. of Canada (US.), 687 F.3d 1266, 1278
(Fed. Cir. 2012) ("[T]he use of a computer in an otherwise patent-ineligible
process for no more than its most basic function-making calculations or
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computations-fails to circumvent the prohibition against patenting abstract
ideas and mental processes."); buySAFE, Inc. v. Google, Inc., 765 F.3d
1350, 1355 (Fed. Cir. 2014) (stating "[t]hat a computer receives and sends
the information over a network-with no further specification-is not even
arguably inventive"); OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359,
13 63 (Fed. Cir. 2015) ("relying on a computer to perform routine tasks more
quickly or more accurately is insufficient to render a claim patent eligible").
For the foregoing reasons, the Appellants' arguments are unpersuasive
as to error in the Examiner's determination that claim 13 does not include an
element or combination of elements sufficient to ensure that the claimed
subject matter in practice amounts to significantly more than to be upon the
abstract idea itself.
Pages 14--16 of the Appeal Brief urge that each claim be separately
treated. However, the discussion there does little more than mention each
claim and then rely on the arguments we have already addressed above in
challenging the patent-ineligibility of claim 13. Accordingly, our earlier
discussion is incorporated herein. Where all claims are directed to the same
abstract idea, "addressing each claim of the asserted patents ... [is]
unnecessary." Content Extraction, 776 F.3d at 1348.
We have considered all of the Appellants' remaining arguments and
have found them unpersuasive. Accordingly, we find the Examiner's
determination that representative claim 13, and claims 1-11, 14--18, 3 7, and
38, which stand or fall with claim 13, are directed to ineligible subject matter
under 35 U.S.C. § 101 has not been shown to be in error. Cf LendingTree,
LLC v. Zillow, Inc., 656 F. App'x 991, 997 (Fed. Cir. 2016) ("We have
considered all of Lending Tree's remaining arguments and have found them
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unpersuasive. Accordingly, because the asserted claims of the patents in suit
are directed to an abstract idea and do not present an 'inventive concept,' we
hold that they are directed to ineligible subject matter under 35 U.S.C.
§ 101.").
DECISION
The decision of the Examiner to reject claims 1-11, 13-18, 37, and 38
is affirmed.
No time period for taking any subsequent action in connection with
this appeal maybe extended under 37 C.F.R. § 1.136(a)(l)(iv).
AFFIRMED
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