Ex Parte Crea et al

Patent Trial and Appeal Board

Apr 25, 2017

10406793 (P.T.A.B. Apr. 25, 2017)

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.
10/406,793 04/02/2003 Kim Crea 90945-654918 (003900US) 9646
20350 7590 04/27/2017
KILPATRICK TOWNSEND & STOCKTON LLP
Mailstop: IP Docketing - 22
1100 Peachtree Street
Suite 2800
Atlanta, GA 30309
EXAMINER
CAMPBELL, KELLIE L
ART UNIT PAPER NUMBER
3691
NOTIFICATION DATE DELIVERY MODE
04/27/2017 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):
ipefiling@kilpatricktownsend.com
KT S Docketing2 @ kilpatrick. foundationip .com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte KIM CREA, JENNIFER GRIMES,
and MARILYN BETHKE
Appeal 2015-0052061
Application 10/406,7932
Technology Center 3600
Before BIBHU R. MOHANTY, MICHAEL W. KIM, and
MATTHEW S. MEYERS, Administrative Patent Judges.
MEYERS, Administrative Patent Judge.
DECISION ON APPEAL
STATEMENT OF THE CASE
Appellants appeal under 35 U.S.C. § 134(a) from the Examiner’s
Final Rejection of claims 1—4, 13—16, and 22. We have jurisdiction under
35 U.S.C. § 6(b).
We AFFIRM.
1 Our decision references Appellants’ Appeal Brief (“Appeal Br.,” filed
October 17, 2014) and Reply Brief (“Reply Br.,” filed April 16, 2015), the
Examiner’s Answer (“Ans.,” mailed February 18, 2015), and Final Office
Action (“Final Act.,” mailed April 15, 2014).
2 Appellants identify Western Union Company as the real party in interest
(Appeal Br. 2).
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CLAIMED INVENTION
Appellants’ claimed invention “relates to the processing of payments
from a consumer to a payee using a network-based consumer interface”
(Spec. 12).
Claims 1,13, and 22 are the independent claims on appeal. Claim 1
reproduced below, with minor formatting changes and added bracketed
notations, is illustrative of the subject matter on appeal:
1. A method of processing a payment from a payer to
a payee, comprising:
[a] receiving, at a host computer system, a request to
initiate a payment from a payer to a payee;
[b] transmitting, from the host computer system to a payer
computer, a request for information relating to the payment;
[c] receiving the information relating to the payment from
the payer at the host computer system, wherein the information
includes:
an amount;
an indication of the payer’s bank; and
an indication of the payee’s bank;
[d] consolidating, by the host computer system, the
information from the payer with information received from other
payers for other payments into consolidated information;
[e] determining, from the consolidated information, by the
host computer system, a first sum which includes:
the amount; and
all amounts to be sent to the payee’s bank for other
payments associated with other payers in the consolidated
information;
[f] determining, from the consolidated information, by the
host computer system, a second sum which includes:
the amount; and
all amounts to be received from the payer’s bank for
other payments associated with other payers in the
consolidated information;
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[g] creating, by the host computer system, a credit
transaction based on the first sum that debits funds from a
transaction processor’s bank and credits funds to the payee’s
bank;
[h] creating, by the host computer system, a debit
transaction based on the second sum that debits funds from the
payer’s bank and credits funds to the transaction processor’s
bank; and
[i] sending both the debit transaction and the credit
transaction to a banking network.
REJECTIONS
Claims 1—4, 13—16, and 22 are rejected under 35 U.S.C. § 101 as
directed to non-statutory subject matter.3
Claims 1—4, 13—16, and 22 are rejected under 35 U.S.C. § 103(a) as
unpatentable over Embrey (US 6,311,170 Bl, iss. Oct. 30, 2001) and Crooks
(US 5,943,656, iss. Aug. 24, 1999).4
ANALYSIS
Non-statutory subject matter
Appellants argue claims 1—4, 13—16, and 22 as a group (see Reply
Br. 2—8). We select claim 1 as representative. Claims 2—4, 13—16, and 22
stand or fall with independent claim 1. See 37 C.F.R. § 41.37(c)(l)(iv).
3 The Examiner entered this rejection as a new ground in the Answer (see
Ans. 2-4).
4 In the Final Action, the Examiner improperly indicates that claims 1—4, 9—
16, and 21 are rejected in the heading (see Final Act. 3). However, the
Examiner properly addresses claims 1—4, 13—16 and 22 in the body of the
rejection (see id. at 3—7). In the Examiner’s Answer, claims 1—4, 13—16, and
22 were improperly rejected under 35 U.S.C. § 102(a) (see Ans. 2).
However, the Examiner properly addresses these claims under § 103(a) (see
Ans. 4). We treat these typographical errors as harmless.
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Alice Corp. Pty. Ltd. v. CLS Bank International, 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. Alice, 134 S. Ct. at 2355.
The “directed to” inquiry [jcannot simply ask whether the claims
involve a patent-ineligible concept, because essentially every
routinely patent-eligible claim involving physical products and
actions involves a law of nature and/or natural phenomenon—
after all, they take place in the physical world. See Mayo, 132
S.Ct. at 1293 (“For all inventions at some level embody, use,
reflect, rest upon, or apply laws of nature, natural phenomena, or
abstract ideas.”) Rather, 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, 2016 WL 1393573, at *5
(Fed. Cir. 2016) (inquiring into “the focus of the claimed advance
over the prior art”).
Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1335 (Fed. Cir. 2016). “The
‘abstract idea’ step of the inquiry calls upon us to look at the ‘focus of the
claimed advance over the prior art’ to determine if the claim’s ‘character as a
whole’ is directed to excluded subject matter.” Affinity Labs of Texas, LLC
v. DIRECTV, LLC, 838 F.3d 1253, 1257 (Fed. Cir. 2016) (citing Elec. Power
Grp., LLC v. Alstom S.A., 830 F.3d 1350, 1353 (Fed. Cir. 2016); see also
Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1335 (Fed. Cir. 2016).
In rejecting claims 1—4, 13—16, and 22, the Examiner finds the claims
“are directed a computerized scheme for processing a payment from a payer
to a payee” (Ans. 2). The Examiner further finds that the claims do not
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include limitations that are “significantly more” than this abstract idea,
because the additional elements or combination of elements in the claims
“do no more than implement the abstract idea of intermediated settlement
with payment consolidation on a generic computer” {id. at 3 4).
Appellants first argue that the Examiner “does not provide citation or
evidence for [their] contention that the alleged abstract ideas of the claims
are indeed abstract ideas” (Reply Br. 2—3). By way of background, the
Examiner finds the claims are
directed [to] a computerized scheme for processing a payment
from a payer to a payee. In particular, the claims are designed to
facilitate the processing of payments from a payer to a payee
after a payer provides the information necessary to complete the
payment from the payer to the payee with the consolidation of a
number of transactions with the payee’s bank into a single
transaction using a transaction processor as an intermediary.
(Ans. 2—3.) The Examiner also finds “[u]sing a computer to create and
maintain account information amounts to electronic recordkeeping ... is one
of the most basic functions of a computer” {id. at 3) and “[t]he same is true
with respect to the use of a computer to obtain data, adjust account balances,
and issue automated instructions (i.e. sending transaction to a banking
network)” (id. ). The Examiner further finds that “the claims do no more
than implement the abstract idea of intermediated settlement with payment
consolidation on a generic computer” {id.). Thus, we determine initially the
Examiner has adequately articulated that the claims are directed to an
abstract idea.
To the extent Appellants argue that the Examiner erred in adequately
supporting this determination by providing citation {see Reply Br. 2), we are
unpersuaded. In this regard, there is no requirement that examiners must
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provide evidentiary support in every case before a conclusion can be made
that a claim is directed to an abstract idea. See, e.g., para. IV “July 2015
Update: Subject Matter Eligibility” to 2014 Interim Guidance on Subject
Matter Eligibility (2014 IEG), 79 Fed. Reg. 74618 (Dec. 16, 2014)
The courts consider the determination of whether a claim is
eligible (which involves identifying whether an exception such
as an abstract idea is being claimed) to be a question of law.
Accordingly, courts do not rely on evidence that a claimed
concept is a judicial exception, and in most cases resolve the
ultimate legal conclusion on eligibility without making any
factual findings.
(Emphasis added.) We agree that evidence may be helpful in certain
situations where, for instance, facts are in dispute. But it is not always
necessary. Based on the above analysis set forth by the Examiner, we are
unpersuaded it is necessary in this case.
Instead, we need only look to other decisions where similar concepts
were previously found abstract by the courts. See Amdocs (Israel) Limited v.
Openet Telecom, Inc., 841 F.3d 1288, 1294 (Fed. Cir. 2016) (“Instead of a
definition [for what an ‘abstract idea’ encompasses], then, the decisional
mechanism courts now apply 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.”)
To that end, as noted above, the Examiner finds the claims “are
directed a computerized scheme for processing a payment from a payer to a
payee” (Ans. 2). Broadly, we agree that the Examiner is correct. According
to Appellants’ Specification, “[t]he present invention relates to network-
based payment processing” (Spec. 12) and “[m]ore particularly, the present
invention relates to the processing of payments from a consumer to a payee
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using a network-based consumer interface” (id.). And, taking independent
claim 1 as representative, the claimed subject matter is generally directed to
“[a] method of processing a payment from a payer to a payee” including
steps for “receiving ... a request to initiate a payment,” transmitting and
receiving “information relating to the payment,” “consolidating . . . the
information from the payer with information received from other payers for
other payments,” “determining ... a first sum,” “determining ... a second
sum,” “creating ... a credit transaction based on the first sum,”
“creating ... a debit transaction based on the second sum,” and “sending
both the debit transaction and the credit transaction to a banking network.”
In this regard, we find that the claims are more precisely directed to
processing a payment from a payer to a payee by creating credit and debit
transactions based on consolidated information amounts, although we do not
discern that any gap between this finding and that of the Examiner is of any
substantive significance. Furthermore, we are persuaded that either
articulation of what the claims are “directed to” is a fundamental economic
practice, in that it is much like the concept of intermediated settlement in
Alice, and the concept of risk hedging in Bilski v. Kappos, 561 U.S. 593
(2010), and, thus, is an abstract idea beyond the scope of § 101. See Alice
Corp., 134 S. Ct. at 2356; Bilski, 561 U.S. at 611.
Appellants also argue that the Examiner fails to satisfy the second step
of the Alice analysis, because the Examiner “is incorrect that the remainder
of the claims do not add significantly more the potential abstract idea itself.”
(Reply Br. 3). However, the only claim elements beyond the abstract idea
are directed to the system (including generic computing systems) on which
the method of processing a payment is performed. Considered as an ordered
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combination, we are unclear as to how these computer components add
anything that is not already present when the steps of the method are
considered separately. The claims do not, for example, appear to improve
the functioning of the computer itself. Nor do they appear to effect an
improvement in any other technology or technical field. Instead, the claims
seem to amount to nothing significantly more than an instruction to apply
the abstract idea of processing a payment using consolidated information
through a batch processing mechanism, i.e., “determining ... a first sum
which includes ... all amounts to be sent to the payee’s bank,”
“determining ... a second sum which includes ... all amounts to be
received from the payer’s bank,” and then creating credit and debit
transactions accordingly, which we are unpersuaded is enough to transform
an abstract idea into a patent-eligible invention. See Alice Corp., 134 S. Ct.
at 2360.
Appellants further argue that even if the claims are directed to an
abstract idea, the claims “do not risk tying up the use of an abstract idea
[and, thus,] do not pose a risk of preempting others from exploiting these
‘building blocks’ of human ingenuity” (Reply Br. 3). Appellants’ argument
is not persuasive.
Although the Supreme Court has described “the concern that drives
this exclusionary principle [i.e., the exclusion of abstract ideas from patent
eligible subject matter] as one of pre-emption,” Alice, 134 S. Ct. at 2354,
characterizing pre-emption as a driving concern for patent eligibility is not
the same as characterizing pre-emption as the sole test for patent eligibility.
“The Supreme Court has made clear that the principle of preemption is the
basis for the judicial exceptions to patentability” and “[f]or this reason,
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questions on preemption are inherent in and resolved by the § 101 analysis.”
Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir.
2015) (citing Alice, 134 S. Ct. at 2354). Yet although “preemption may
signal patent ineligible subject matter, the absence of complete preemption
does not demonstrate patent eligibility.” Id.
In view of the foregoing, we sustain the Examiner’s rejection under
35 U.S.C. § 101 of independent claim 1, and claims 2-4, 13—16, and 22,
which fall with independent claim 1.
Obviousness
Independent claim 1 and dependent claims 2—4
We are persuaded by Appellants’ argument that the Examiner erred in
rejecting independent claim 1 under 35 U.S.C. § 103(a), because the
combination of Embrey and Crooks fails to disclose or suggest “initiat[ing] a
single transaction from its own account to a target bank, for distribution for
multiple payees; and initiate another single transaction to its own account
from a source bank to account for multiple payers,” as called for by
independent claim 1 (Appeal Br. 4—6; see also Reply Br. 4—8).
The Examiner maintains that the rejection is proper, and cites Embrey
at column 3, lines 42-46; column 4, lines 7—9; column 12, lines 59-67;
column 13, lines 34—67; column 15, line 63 through column 16, line 10;
column 26, lines 54—60; and Figures 15 and 27, as disclosing the argued
subject matter (see Final Act. 3—5; see also Ans. 4—8). However, we agree
with Appellants that there is nothing in the cited portions that discloses or
suggests the argued subject matter.
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In making this determination, we note that Embrey is directed to a
payment system “for consolidating and streamlining payment activities
through the utilization of a third party payment service provider” (Embrey,
col. 1,11. 15—18) “which relies heavily upon the electronic communication of
data and the electronic transferring of funds” (id. at col. 3,11. 5—9). More
particularly, Embrey discloses that its payment system
allows a service provider to make payments, on behalf of a
plurality of payor entities, to a plurality of payee entities, in a
manner which greatly reduces the operating and administrative
costs for accounting and disbursement activities, and which
greatly streamlines and consolidates the payment activities and
provides highly organized and consolidated information to the
plurality of payee entities.
(Id. at col. 2,11. 52—60.) Embrey discloses once
authorization is obtained from a plurality of payor entities which
allows a service provider to make payments, on behalf of the
plurality of payor entities, to a plurality of payee entities. Then
at least one trusted intermediary financial institution is selected.
The trusted intermediary financial institution periodically
receives payment information and payment authorization from
the plurality of payor entities.
(Id. at col. 3,11. 15—22.) “Then, the service provider is utilized to (1)
consolidate payment instructions from the plurality of payor entities, (2)
direct a negotiable instrument, in an amount equal to the consolidated
payments, to each of the plurality of payee entities” (id. at col. 3,11. 42 46;
see also id. at col. 12,11. 14—15). Embrey discloses that payment
instructions information “includes at least (1) an identification of each of the
plurality of payee entities, (2) an identification of payment amounts for each
of the plurality of payee entities; and (3) a payment record identifier which is
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uniquely associated with each payment amount such as a ‘virtual check
number’” (id. at col. 3,11. 34-41).
In this regard, the consolidation criterion includes
grouping the payment information ... for each payee identity, in
order to obtain efficiencies in reporting information due to a
plurality of payees. Then, the payments are directed to the
plurality of payees by the plurality of payors in order to satisfy
the plurality of payment obligations. The information service
provider operates independently of the plurality of payors to
direct consolidated payment information to the plurality of
payees, without requiring active interaction between the
information service provide and the plurality of payees.
(Id. at col. 5,1. 65 — col. 6,1. 8; see also id. at col. 12,11. 54—67). Embrey
also discloses that “trusted intermediary financial institution 13 utilizes
conventional electronic funds transfers or E.D.I.B.A.N.X. transfers in order
to pull funds from the accounts of the payor entities (in accordance with Step
Eighteen), and deposit funds in the disbursement account of service provider
11”(id. at col. 13,11. 55—62). Embrey further discloses that “[i]n essence, the
account of service provider 11 is a mere shell 15 which allows for payment
activities to push and pull funds to and from it in order to satisfy the
payment obligations which have been cleared with both the positive pay
sheet and the approved pay sheets” (id. at 14,11. 13—18).
Crooks is directed to a computerized billing and payment
authorization method and system which provides remote electronic access to
billing information in a host computer (col. 1, 1. 62 — col. 3, 1.3).
We have reviewed the cited portions of Embrey and agree with
Appellants that none of the cited portions of Embrey discloses or suggests
the argued subject matter. More particularly, we agree with Appellants that
Embrey does not disclose or suggest “summing the amount of the
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transaction between the payer and the payee with all amounts to be received
from the payer’s bank (not the payer) from other transactions” (Appeal Br.
5; see also Reply Br. 6—8). Therefore, although we agree with the Examiner
that Embrey discloses “determining, from the consolidated information, by
the host computer system, a first sum which includes: the amount; and all
amounts to be sent to the payee’s bank for other payments associated with
other payers in the consolidated information” as recited by limitation [e], we
fail to see, and the Examiner does not adequately explain how, Embrey’s
disclosure regarding consolidating “the payment information ... for each
payee identity, in order to obtain efficiencies in reporting information due a
plurality of payees” (Embrey, col. 5,11. 65—67) also discloses or suggests
“determining, from the consolidated information, by the host computer
system, a second sum which includes: the amount; and all amounts to be
received from the payer’s bank for other payments associated with other
payers in the consolidated information,” as recited by limitation [f]
(emphasis added). The Examiner does not rely on Crooks to address this
deficiency.
In view of the foregoing, we do not sustain the Examiner’s rejection
of independent claim 1 under 35 U.S.C. § 103(a) as unpatentable over
Embrey and Crooks. For the same reasons, we also do not sustain the
Examiner’s rejection of dependent claims 2—4 which depend from
independent claim 1.
Independent claims 13 and 22, and dependent claims 14—16
We are not persuaded by Appellants’ argument that the combination
of Embrey and Crooks fails to disclose or suggest the subject matter of
independent claims 13 and 22, “at least because Embrey and Crooks do not
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teach or suggest all of the recitations of these claims as detailed above with
respect to similar recitations in claim 1” (Appeal Br. 6).
In making this determination, we note that although independent
claims 13 and 22 require determining a first sum from the consolidated
information, i.e., “determining, from the consolidated information, by the
host computer system, a first sum which includes: the amount; and all
amounts to be sent to the payee’s bank for other payments associated with
other payers in the consolidated information” as recited by limitation [e] of
independent claim 1, neither independent claim 13 nor independent claim 22
recited determining a second sum from the consolidated information, i.e.,
“determining, from the consolidated information, by the host computer
system, a second sum which includes: the amount; and all amounts to be
received from the payer’s bank for other payments associated with other
payers in the consolidated information,” as recited by limitation [e] of
independent claim 1. Thus, Appellants’ argument fails to persuade us of
error in the Examiner’s rejection.
In view of the foregoing, we sustain the Examiner’s rejection of
independent claims 13 and 22 under 35 U.S.C. § 103(a). We also sustain the
Examiner’s rejection of dependent claims 14—16, which are not argued
separately.
DECISION
The Examiner’s rejection of claims 1—4, 13—16 and 22 under 35
U.S.C. § 101 is affirmed.
The Examiner’s rejection of claims 1—4 under 35 U.S.C. § 103(a) is
reversed.
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The Examiner’s rejection of claims 13—16 and 22 under 35 U.S.C.
§ 103(a) is affirmed.
No time period for taking any subsequent action in connection with
this appeal may be extended under 37 C.F.R. § 1.136(a)(l)(iv).
AFFIRMED
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