Ex Parte Dinella

Patent Trial and Appeal Board

May 31, 2018

11385276 (P.T.A.B. May. 31, 2018)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE
11/385,276 03/21/2006
23460 7590 06/04/2018
LEYDIG VOIT & MA YER, LTD
TWO PRUDENTIAL PLAZA, SUITE 4900
180 NORTH STETSON A VENUE
CHICAGO, IL 60601-6731
FIRST NAMED INVENTOR
Roger W. Dinella
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.
250896 1806
EXAMINER
GREGG, MARY M
ART UNIT PAPER NUMBER
3697
NOTIFICATION DATE DELIVERY MODE
06/04/2018 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):
Chgpatent@leydig.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte ROGER W. DINELLA
Appeal2017-000390
Application 11/385,276
Technology Center 3600
Before BIBHU R. MOHANTY, BRADLEY B. BAY AT, and
AMEE A. SHAH, Administrative Patent Judges.
SHAH, Administrative Patent Judge.
DECISION ON APPEAL 1
The Appellant2 appeals under 35 U.S.C. § 134(a) from the Examiner's
decision rejecting claims 1, 2, and 4--9, which are all of the pending claims.
We have jurisdiction under 35 U.S.C. § 6(b).
We AFFIRM.
1 Throughout this Decision, we refer to the Appellant's Appeal Brief ("Br.,"
filed Feb. 5, 2016) and Specification ("Spec.," filed Mar. 21, 2006), and to
the Examiner's Answer ("Ans.," mailed July 28, 2016) and Final Office
Action ("Final Act.," mailed Apr. 3, 2015).
2 According to the Appellant, the real party in interest is American
International Group, Inc. Br. 1.
Appeal2017-000390
Application 11/385,276
STATEMENT OF THE CASE
The Appellant's "invention is directed to a novel business framework
for enabling a non-physical injury tort victim to receive periodic future
payments from the defendant of the tort claim( s) under a settlement
agreement without undesired income tax consequences." Spec. ,r 15.
Claim 1 (Br. 15 (Claims App.)) is the only independent claim on
appeal, is representative of the subject matter on appeal, and is reproduced
below (with added bracketing and paragraphing):
1. A computerized method of periodically transferring
funds to a known claimant, comprising:
[(a)] electronically executing a transfer of a pre-existing
obligation
to make one or more known future periodic
payments to the known claimant from a paying party to
an unlimited liability entity via a processor in the absence
of both a secondary guarantee and surety bond from the
paying party with the known claimant as beneficiary,
the future periodic payments comprising a non-
qualified structured payment program,
the unlimited liability entity receiving at least one
payment from the paying party in exchange for assuming
the pre-existing obligation,
the unlimited liability entity being owned by a
parent company,
the pre-existing obligation transferred to the
unlimited liability entity comprising an unsecured
promise to make each future periodic payment to the
claimant such that the known claimant does not
constructively receive said one or more known future
payments at the time the pre-existing obligation is
transferred to the unlimited liability entity; and
2
Appeal2017-000390
Application 11/385,276
[(b)] after executing the transfer, electronically
transferring funds from the unlimited liability entity to another
party
to purchase an investment product to offset the
pre-existing obligation and
periodically electronically transferring funds from
the unlimited liability entity to the claimant via a
processor in accordance with the transferred pre-existing
obligation.
REJECTIONS
Claims 1, 2, and 4--9 stand rejected under 35 U.S.C. § 101 as directed
to non-statutory subject matter. Final Act. 10.
Claims 1, 2, and 6-9 stand rejected under 35 U.S.C. § I03(a) as being
unpatentable over Appellant's Admitted Prior Art (hereafter "AAPA"),
Fujihara et al. (US 2004/0128248 Al, pub. July 1, 2004) (hereafter
"Fujihara"), and Ehrhart et al. (US 2006/0112009 Al, pub. May 25, 2006)
(hereafter "Ehrhart"). Id. at 12.
Claims 4 and 5 stand rejected under 35 U.S.C. § I03(a) as being
unpatentable over AAP A, Fujihara, Ehrhart, and "Structured Settlement
Services," available at web.archive.org, www.structuredsettlements.org, (last
retrieved May 17, 2008) (hereinafter "Structured Settlement"). Id. at 18.
ANALYSIS
35 U.S.C. § 1 OJ -Non-statutory Subject Matter
The Appellant argues claims 1, 2, and 4--9 as a group. See Br. 3, 7.
We select claim 1 as representative of the group; claims 2 and 4--9 stand or
fall with claim 1. See 37 C.F.R. § 4I.37(c)(l)(iv).
3
Appeal2017-000390
Application 11/385,276
Under 35 U.S.C. § 101, a patent may be obtained for "any new and
useful process, machine, manufacture, or composition of matter, or any new
and useful improvement thereof." The Supreme Court has "long held that
this provision contains an important implicit exception: Laws of nature,
natural phenomena, and abstract ideas are not patentable." Alice Corp. Pty.
Ltd. v. CLS Bankint'l, 134 S. Ct. 2347, 2354 (2014) (quotingAss'nfor
Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. 576, 588-89
(2013)).
The Supreme Court in Alice reiterated the two-step framework, set
forth previously in Mayo Collaborative Services v. Prometheus
Laboratories, Inc., 566 U.S. 66, 78-79 (2012), "for distinguishing patents
that claim laws of nature, natural phenomena, and abstract ideas from those
that claim patent-eligible applications of those concepts." Alice, 134 S. Ct.
at 2355. The first step in that analysis is to "determine whether the claims at
issue are directed to one of those patent-ineligible concepts." Id. (emphasis
added) ( citing Mayo, 566 U.S. at 79). If so, the second step is to consider
the elements of the claims "individually and 'as an ordered combination'" to
determine whether the additional elements "'transform the nature of the
claim' into a patent-eligible application." Id. ( quoting Mayo, 566 U.S.
at 78-79).
Turning to the first step of the Alice/ Mayo framework, the Examiner
determines that the claim is directed to "meeting payment obligation
contract compliance payment instructions for performing a money transfer,"
which is a fundamental economic practice. Final Act. 10. Conversely, the
Appellant contends "[c]laim 1 is directed to a computerized method of
periodically transferring funds to a known claimant." Br. 5.
4
Appeal2017-000390
Application 11/385,276
The step-one analysis requires us to consider the claims "in their
entirety to ascertain 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). The question is whether the claim as
a whole "focus[ es] on a specific means or method that improves the relevant
technology" or is "directed to a result or effect that itself is the abstract idea
and merely invoke generic processes and machinery." McRO, Inc. v. Bandai
Namco Games Am. Inc., 837 F.3d 1299, 1314 (Fed. Cir. 2016).
Here, the Specification is titled "METHOD AND SYSTEM FOR
MAKING TAXABLE STRUCTURED SETTLEMENT PAYMENTS."
The invention "is directed to a novel business framework for enabling a non-
physical injury tort victim to receive periodic future payments from the
defendant of the tort claim( s) under a settlement agreement without
undesired income tax consequences." Spec. ,r 15. In the Background
section, the Specification discusses that an existing problem with structured
settlement payments for a non-physical tort injury is that many of them "do
not qualify for tax-free treatment under the existing U.S. income tax law."
Id. ,r 6. The invention solves this problem by "provid[ing] a framework for
structured payments for settlements for non-physical tort injuries that offers
the benefits of structured payments while ensuring that the recipient of the
payments is not required to pay tax upfront on the present value of the future
payments." Id. ,r 8.
Claim 1 provides for a "computerized method of periodically
transferring funds to a known claimant," comprising the steps of
"electronically executing a transfer of a pre-existing obligation to make one
or more known future periodic payments" and "after executing the transfer,
5
Appeal2017-000390
Application 11/385,276
electronically transferring funds from the unlimited liability entity to another
party." Br. 15 (Claims App.). The Specification does not provide details on
the how, technologically, the steps of executing the transfers of obligations
and funds are performed. In fact, the Specification does not mention a
"computer" or "processor" to implement the method or any computerization
of the method at all. The only mentions of a "system" are in the title of the
invention and in originally filed claim 10, which claims a system comprising
a parent company and an unlimited liability or partially owned company.
See Spec. p. 10.
In light of Specification's description of the problem and solution, the
Specification's purported advance over the prior art by the claimed invention
is to structure payment settlements so that up front tax payments are not
required. In that context, considering the claim in light of the Specification
and on its "character as a whole" (Enfish, LLC v. Microsoft Corp., 822 F.3d
1327, 1335 (Fed. Cir. 2016)), the claim is directed to periodically
transferring funds in accordance with obligations, 3 a fundamental economic
practice that is performed manually. In this manner, the claim is similar to
those deemed to be abstract ideas by our reviewing court in Smart Systems
Innovation, Inc. v. Chicago Transit Authority, 873 F.3d 1364, 1371-72 (Fed.
Cir. 2017) (forming and collecting data for financial transactions in a certain
field), Inventor Holdings, LLC v. Bed Bath & Beyond, Inc., 876 F.3d 1372,
1378-79 (Fed. Cir. 2017) ("local processing of payments for remotely
3 We note 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). The Board's "slight revision of its abstract idea analysis
does not impact the patentability analysis." Id. at 1241.
6
Appeal2017-000390
Application 11/385,276
purchased goods"), and CyberSource Corp. v. Retail Decisions, Inc., 654
F.3d 1366, 1372-73 (Fed. Cir. 2011) (verifying the validity of credit card
transactions over the Internet). Here, the claim involves nothing more than
transferring data, without any particular inventive technology- an abstract
idea. See Electric Power Group, LLC v. Alstom S.A., 830 F.3d 1350, 1354
(Fed. Cir. 2016).
Turning to the second step of the Alice/Mayo framework, we agree
with and adopt the Examiner's determination that the claim's limitations,
taken individually or as an ordered combination, do not recite an inventive
concept. See Final Act. 11; Ans. 4--7. We are unpersuaded by the
Appellant's arguments to the contrary. See Br. 5-7.
The second step is to "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, 566 U.S. at 72-73). The Court acknowledged in Mayo, that
"all inventions at some level embody, use, reflect, rest upon, or apply laws
of nature, natural phenomena, or abstract ideas." Mayo, 566 U.S. at 71. We,
therefore, look to whether the claims focus on a specific means or method
that improves the relevant technology or are instead directed to a result or
effect that itself is the abstract idea, and merely invoke generic processes and
machinery, i.e., "whether the focus of the claims is on [a] specific asserted
improvement in computer capabilities ... or, instead, on a process that
qualifies as an 'abstract idea' for which computers are invoked merely as a
tool." Enfish, 822 F.3d at 1335-36).
7
Appeal2017-000390
Application 11/385,276
We find unpersuasive the Appellant's argument that the claim is
patent-eligible because it "recites additional elements that amount to
significantly more than a judicial exception. In that regard, claim 1 satisfies
the machine-or-transformation test." Br. 5. The claim does not pass the
machine-or-transformation test because the claim does not transform
anything into a different article or thing nor is it not tied to any particular
novel machine or apparatus; at best, it is tied to a general purpose computer.
See Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 716-17 (Fed. Cir. 2014).
The claim is not tied to a specific apparatus or machine, but merely recites
that the obligations and funds are transferred "electronically" and "via a
processor." Contrary to the Appellant's assertion, there is no "identif[ication
of] particular devices and require[ments for] a particularly-programmed
machine to carry out the recited steps." Br. 5. As discussed above, the
Specification provides no description of any technology, including a
processor, to perform the electronic transfer or even to be programmed. As
such, at best, the claim requires the use of a generic computer performing in
its ordinary and customary manner. This is not enough to find that claim 1
contains an inventive concept. See Smart Systems, 873 F.3d at 1375.
We also find unpersuasive the Appellant's argument that the claim is
significantly more than an abstract idea, because it "includes steps and
features that apply its claimed concepts to a new and useful end." Br. 6; see
also id. at 7. The Appellant recites the limitations of the claim and simply
states that "claim 1 provides a computer-implemented tool for periodically
transferring funds to a known claimant which overcomes the noted problem
in the art." Id. at 6; see also id. at 7. The Appellant does not provide further
support or reasoning as to why or how the limitations of transferring data are
8
Appeal2017-000390
Application 11/385,276
not well-understood, routine, and conventional functions of a generic
computer or how any technology is improved. As discussed above, there is
no indication in the Specification that any technology is used, much less any
requirement of technologically novel or inventive hardware. See Affinity
Labs of Texas, LLC v. DIRECTV, LLC, 838 F.3d 1253, 1263 (Fed. Cir.
2016); see also Enfish, 822 F.3d. at 1336 (focusing on whether the claim is
"an improvement to [the] computer functionality itself, not on economic or
other tasks for which a computer is used in its ordinary capacity"). We
agree with the Examiner that
[t]he claimed limitations are not directed toward a specific
improvement to any form or type of technology, in existing but
well-known environment, without any part of the claimed
limitations that reflect an inventive solution to any presented by
combining the two. The computer elements recited in the claim
are not an integral part of the claim, as a human being could
easily perform the claimed limitations.
Ans. 4. We note that the Appellant does not present reasoning or
argument( s) as to why the Examiner's determinations regarding the
Specification and the judicial decisions relied upon for support and evidence
(see id. at 4--5) are incorrect.
We further find unpersuasive the Appellant's argument that the claim
is significantly more than an abstract idea because "[t]he claimed solution is
rooted in computer technology in order to satisfy persistent needs
specifically arising in the field of structure settlement payments, namely
providing protection against the risk of incurring unwanted tax consequences
before actually receiving payments." Br. 6-7. "The risk of incurring
unwanted tax consequences before actually receiving payments" (id.) is not
a "problem specifically arising in the realm of computer networks." DDR
9
Appeal2017-000390
Application 11/385,276
Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245, 1257 (Fed. Cir. 2014).
And, the purported solution here of, at best, a generic processor, is not
"necessarily rooted in computer technology." Id. at 1256. The inquiry is not
whether there is a business/financial challenge resolved by the instant
invention, but whether the challenge is one rooted in technology, or one
where the proposed solution is merely using computers as a tool. See id., see
also Enfish, 822 F.3d at 1335-36. The Appellant does not present reasoning
or argument(s) as to why the Examiner's determination (Ans. 6-7) that the
problem addressed and the purported solution provided by the claimed
invention do not meet that inquiry.
Thus, we are not persuaded that the Examiner erred in rejecting
claim 1 under 35 U.S.C. § 101, and, therefore, we sustain the rejection of
claim 1 and of claims 2 and 4--9, which fall with claim 1.
35 U.S.C. § 103 - Obviousness
The Appellant argues claims 1, 2, and 4--9 as a group. See Br. 12-13
(relying on the arguments for claim 1 for claims 2 and 4--9). We select
claim 1 as representative of the group. The rejections of claims 2 and 4--9
stand or fall with claim 1. See 37 C.F.R. § 4I.37(c)(l)(iv).
The Appellant contends that the Examiner's rejection of claim 1 is in
error because "it would not have been obvious at the time of the instant
invention to modify a conventional structured payment program with
features from Fujihara and Ehrhart as proposed" (Br. 9), and because, "even
assuming for the moment that such a combination is made, the proposed
combination of references fails to yield the invention described in
independent claim 1" (id.). We disagree with the Appellant's contention.
10
Appeal2017-000390
Application 11/385,276
The Examiner finds that the Appellant's Specification at paragraphs 3
and 5 through 7 (hereinafter "AAPA") teaches executing a transfer of an
obligation as recited in limitation (a) of claim 1 (see Final Act. 12) and
transferring the funds after executing the transfer of the obligation as recited
in limitation (b) of claim 1 (see id. at 13). The Examiner finds that the
AAP A does not teach the transfers being performed electronically (see id.)
and "does not explicitly teach unsecured promise to make a future payment
that is not constructively received" (id. at 15).
The Examiner cites to In re Venner, 262 F.2d 91, 95 (CCPA 1958) as
support that it would have been obvious to automate a manual practice, i.e.,
electronically transferring data. Id. at 13. The Examiner also cites to
Fujihara for "electronically executing a transfer of a pre-existing obligation
[trust account data]." Id. at 14 (citing Fujuhara Abstract, ,r,r 15-21,
Figs. 1-9). The Examiner determines that
Id.
It would have been obvious to expand the teaching of [ AAP A]
for transfer of trust data to include the teaching of Fujihara for
electronic data transfer since Fujihara provides motivation that
there is a need for retrieval processing and the updating
processing can be conducted independently from each other and
in parallel to each other also occurs in a lot management of
material or parts whose amount or number can be divided or
merged regarding the same or one item (see para 0008-0015).
The Examiner further finds that the AAPA "does teach structured
payment programs that encompass both qualified (tax free) and non-
qualified payments (taxable)" (id. at 15), and that the AAPA cites to the tax
codes and statutes. The Examiner thus determines that the AAPA's teaching
that
11
Appeal2017-000390
Application 11/385,276
nonqualified payments create issues regarding the taxation of the
payment and that based on the constructive receipt of the
payment, the recipient incurs upfront tax liability of the present
value of the future payments and that therefore, for tax purposes
it is undesirable to the settlement payout for the recipient ...
provides some teaching, suggestion and motivation that would
have led one of ordinary skill in the art to arrive as the claimed
invention.
Id. The Examiner also cites to Ehrhart for the pre-existing obligation
comprising an unsecured promise as recited in limitation (a). Id. ( citing
Ehrhart Abstract, ,r,r 18, 37-39). The Examiner determines that one of
ordinary skill in the art would modify the AAP A's obligations so that
"payments received that are not tax exempt that it is desirable not to incur
tax liability on present value" (id.) and to disburse future payments "in order
to minimize credit risk of unsecured creditor and reduce tax liability," as
taught by Ehrhart (Ans. 10). The Examiner also determines that "one of
ordinary skill in the art would have recognized that applying the known
technique would have yielded predictable results and resulted in an
improved system." Final Act. 16. The Examiner further finds that "the
claimed elements except for the insignificant activity of data transfer, are
directed toward contractual obligation transfer and terms ... [and
c ]ontractual transfer and terms are patent ineligible subject matter and
therefore carry no patentable weight and therefore, is non-patentable."
Ans. 16.
The Appellant argues "that one skilled in the art would not have been
motivated to combine the various elements selected from the applied
references as proposed in the pending Office Action," and that the Examiner
uses hindsight. Br. 9. However, the Appellant does not address the
Examiner's determinations that one of ordinary skill in the art would
12
Appeal2017-000390
Application 11/385,276
combine the references "in order to minimize credit risk of unsecured
creditor and reduce tax liability," as taught by Ehrhart (Ans. 10), and so "the
updating processing can be conducted independently from each other and in
parallel to each other also occurs in a lot management of material or parts
whose amount or number can be divided or merged regarding the same or
one item," as taught by Fujihara (Final Act. 14; Ans. 8). As such, we find
unpersuasive the Appellant's argument that the Examiner uses improper
hindsight.
The Appellant argues that the Background section of the Specification
"is not to be taken as an indication that any of the indicated problems were
themselves appreciated in the art." Br. 10. To the extent the Appellant
argues that the Background section of the Specification is not Appellant's
Admitted Prior Art, we are unpersuaded. The Appellant's Specification
provides that "[ s ]tructured settlement payments [ with periodic payments]
that qualify for tax exemption are often made through an 'assignment
company"' whereby "the defendant or its liability insurer may transfer the
obligation to make future payments through a 'qualified assignment' to the
assignment company, which may be owned by a life insurance company"
and the recipient of the compensation is issued a guarantee of the obligation.
Spec. ,r 5 ( emphasis added). Due to the advantages of relieving the
defendant of future responsibility for making, administration of, and record-
keeping for periodic payments, "structured programs for tax-free settlement
payments have been widely used and have become a significant insurance
market place, with 6 billion U.S. dollars of annuity premium written in
2005." Id. (emphases added). Further, the Specification provides that
"[ s ]tructured payment programs have also been used for settlement
13
Appeal2017-000390
Application 11/385,276
payments that do not qualify for tax-exempt treatment under the existing
U.S. income tax law." Id. ,r 6 (emphases added). And the Specification
provides that there have been uncertainties whether "[e]xisting 'non-
qualified' structured settlement payment programs" for non-physical tort
injuries qualify for tax exemption. Id. ,r 7 ( emphasis added). Thus, the
Appellant makes statements in the Specification that the prior art includes
these structured settlement programs. "A statement in a patent that
something is in the prior art is binding on the applicant and patentee for
determinations of anticipation and obviousness." Constant v. Advanced
Micro-Devices, Inc., 848 F.2d 1560, 1570 (Fed. Cir. 1988) citing In re
Nomiya, 509 F.2d 566,571 (CCPA 1975).
The Appellant further argues that "[i]t is unclear why one skilled in
the art would be motivated to modify an existing 'non-qualified' structured
settlement payment program with the Fujihara method at all, much less in
such a way as to arrive at the method recited in claim l," because "Fujihara
is directed to account managing/settling systems and methods" and "Fujihara
would not logically have commended itself to the Appellant's attention in
considering the problem with which the inventor was involved." Br. 10-11.
The Appellant makes similar argument regarding the prior art Ehrhard.
Br. 11. The Appellant's arguments that Fujihara and Ehrhart are non-
analogous art are unpersuasive.
Our reviewing court has set forth a two-prong test for determining
whether a prior art reference is analogous: (1) whether the reference is from
the same field of endeavor as the claimed invention, and (2) if the reference
is not within the same field of endeavor, whether the reference is reasonably
pertinent to the particular problem with which the inventor is involved. In re
14
Appeal2017-000390
Application 11/385,276
Klein, 647 F.3d 1343 (Fed. Cir. 2011). Regarding the first prong, the
Appellant does not explicitly state what the Appellant considers to be the
field of endeavor (see Br. 10), but the Specification indicates that the field of
endeavor is providing and managing financial accounts, i.e., structured
settlement programs with periodic payments (see Spec. ,r,r 1, 9, 15).
Fujihara similarly provides for method for managing financial accounts. See
Fujihara ,r,r 5, 9-11. And, Ehrhart similarly provides for providing and
managing financial accounts of deferred compensation with periodic
payments. See Ehrhart ,r 37. As such, both Fujihara and Ehrhart satisfy the
first prong and are analogous art.
Regarding the second prong of the test, as the Examiner notes,
Fujihara is relied on for the use of technology to electronically transfer data.
Ans. 8. The Appellant does not state what problem the electronic transfer of
data addresses such that we can evaluate whether Fujihara is not reasonably
pertinent. As discussed above, the Specification is silent as to any use or
purpose of any technology in performing the steps of the method. With
respect to Ehrhart, the Appellant's Specification and Ehrhart both provide
that their respective inventions address the problem of having payments
taxed immediately and not receiving favorable tax treatment. See Spec.
,r,r 1, 7, 8; Ehrhart ,r,r 9, 10, 18-20. As such, Ehrhart also satisfies the
second prong of the test.
The Appellant further argues
the proposed combination fails to teach, suggest or otherwise
render obvious a computerized method of periodically
transferring funds to a known claimant that includes:
electronically executing a transfer of a pre-existing obligation to
make one or more known future periodic payments to the known
claimant from a paying party to an unlimited liability entity via
15
Appeal2017-000390
Application 11/385,276
a processor in the absence of both a secondary guarantee and
surety bond from the paying party with the known claimant as
beneficiary, where the unlimited liability entity is owned by a
parent company and the pre-existing obligation transferred to the
unlimited liability entity comprises an unsecured promise to
make each future periodic payment to the claimant such that the
known claimant does not constructively receive said one or
more known future payments at the time the pre-existing
obligation is transferred to the unlimited liability entity [ as
recited in limitation (a)] and periodically electronically
transferring funds from the unlimited liability entity to the
claimant via a processor in accordance with the transferred pre-
existing obligation, as recited in [limitation (b) of ]claim 1.
Br. 11-12.
Regarding limitation (a), the Appellant does not distinctly point out or
provide sufficient evidence or technical reasoning why the Examiner's
findings that the AAPA and Fujihara, and Erhart teach limitation (a) are in
error. See 37 C.F.R. § 4I.37(c)(iv) (2014) ("A statement which merely
points out what a claim recites will not be considered an argument for
separate patentability of the claim."); see also In re Lovin, 652 F.3d 1349,
1357 (Fed. Cir. 2011) ("[W]e hold that the Board reasonably interpreted
Rule 41.37 to require more substantive arguments in an appeal brief than a
mere recitation of the claim elements and a naked assertion that the
corresponding elements were not found in the prior art."). Viewed as a
whole, the Appellant's argument amounts to a recitation of the claim
language, and a conclusory statement that the references do not meet the
quoted claim language.
Other than seeking direct quotations of identical terminology, the
Appellant has not identified error in the Examiner's interpretations of the
cited references or the claim language (see Final Act. 12-16; Ans. 11-14).
16
Appeal2017-000390
Application 11/385,276
The Appellant may well disagree with how the Examiner interpreted and
applied the references, but the Appellant offers no substantive arguments to
rebut the specific underlying factual findings made by the Examiner in
support of the ultimate legal conclusion of obviousness. And we decline to
examine the claims sua sponte, looking for distinctions over the prior art.
Cf In re Baxter Travenol Labs., 952 F.2d 388, 391 (Fed. Cir. 1991) ("It is
not the function of this court to examine the claims in greater detail than
argued by an appellant, looking for [patentable] distinctions over the prior
art.").
Regarding limitation (b ), the Appellant argues that Ehrhart does not
teach transferring funds in accordance with the transferred obligation
because "Ehrhart teaches that their approach is only useful when combined
with a 'rolling forward phase' in which initial payment dates are re-
scheduled to a subsequent payment date, see, e.g., Ehrhart, p. 4, ,r [0037];
Fig. 3." Br. 12. This argument is unpersuasive because the Appellant
attacks Ehrhart individually when the rejection is based on a combination of
the references. The test for obviousness is not what any one reference would
have suggested, but rather what the combined teachings of the references
would have suggested to those of ordinary skill in the art. See In re Keller,
642 F.2d 413,426 (CCPA 1981). "[O]ne cannot show non-obviousness by
attacking references individually where, as here, the rejections are based on
combinations of the references." Id. As discussed above, the Examiner
relies of the AAP A for teaching transferring funds in accordance with the
transferred existing obligation, on Fujihara for the transfer being performed
electronically, and on Ehrhart for some of the details of the obligation. Final
Act. 13-16.
17
Appeal2017-000390
Application 11/385,276
Thus, we are not persuaded that the Examiner erred in rejecting
claim 1 under 35 U.S.C. § 103(a). We therefore sustain the rejection of
claim 1 and the rejections of claims 2 and 4--9, which fall with claim 1.
DECISION
The Examiner's rejection of claims 1, 2, and 4--9 under 35 U.S.C.
§ 101 is AFFIRMED.
The Examiner's rejections of claims 1, 2, and 4--9 under 35 U.S.C.
§ 103 are 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
18