Ex Parte Fordyce et al

Patent Trials and Appeals Board

May 16, 2019

15091464 - (D) (P.T.A.B. May. 16, 2019)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE
15/091,464 04/05/2016
144885 7590 05/20/2019
The Webb Law Firm/ Visa International
ONE GATEWAY CENTER
420 FT. DUQUESNE BL VD, SUITE 1200
PITTSBURGH, PA 15222
FIRST NAMED INVENTOR
Edward W. Fordyce III
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.
8223-1706942 6918
EXAMINER
BAGGOT, BREFFNI
ART UNIT PAPER NUMBER
3622
NOTIFICATION DATE DELIVERY MODE
05/20/2019 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):
patents@webblaw.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte EDWARD W. FORDYCE III,
MICHELLE ENG WINTERS, KEVIN PAUL SIEGEL,
LEIGH AMARO, CHARLES RAYMOND BYCE,
and NUR TEKIN SAVAS
Appeal2017-011259
Application 15/091,464 1
Technology Center 3600
Before MAHSHID D. SAADAT, LINZY T. McCARTNEY, and
JOHN P. PINKERTON, Administrative Patent Judges.
PINKERTON, Administrative Patent Judge.
DECISION ON APPEAL
Appellants appeal under 35 U.S.C. § 134 from the Examiner's Final
Rejection of claims 1 and 3-19. Claims 2 and 20 are canceled. We have
jurisdiction under 35 U.S.C. § 6(b).
We affirm.
1 Appellants identify VISA INTERNATIONAL SERVICE ASSOCIATION
as the real party in interest. App. Br. 2.
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STATEMENT OF THE CASE
Introduction
Appellants generally describe the disclosed and claimed invention as
follows:
A system including a transaction handler to process
transactions, a data warehouse to store transaction data recording
the transactions processed at the transaction handler, a profile
generator to generate a profile of a user based on the transaction
data, an advertisement selector to identify an advertisement
based on the profile of the user in response to the transaction
handler processing a transaction of the user, and a portal coupled
to the transaction handler to provide the advertisement for
presentation to the user in connection with information about the
transaction of the user. In one example, the profile includes a
plurality of values representing aggregated spending of the user
in various areas to summarize the transactions of the user.
Abstract. 2
Claims 1, 16, and 1 7 are independent claims. Claim 1 is
representative of the subject matter on appeal and reads as follows (with
format changes and paragraph lettering added):
1. A method, comprising:
(a) providing a computing apparatus comprising:
(b) a transaction handler configured in an
electronic payment processing network;
( c) a data warehouse coupled with the
transaction handler and storing:
2 Our Decision refers to the Final Office Action mailed Nov. 18, 2016
("Final Act."), Appellants' Appeal Brief filed Apr. 21, 2017 ("App. Br.")
and Reply Brief filed July 24, 2017 ("Reply Br."), the Examiner's Answer
mailed July 14, 2017 ("Ans."), and the original Specification filed Apr. 5,
2016 ("Spec.").
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( d) first transaction data recording payment
transactions of a plurality of first users processed by the
transaction handler during a first period of time,
( e) second transaction data recording
payment transactions of a second user processed
by the transaction handler during a second period
of time, and;
(f) registration data associating an
account of the second user with a communication
reference of a mobile device of the second user;
(g) a profile generator coupled with the data
warehouse; and
(h) a portal coupled with the transaction handler and
configured to communicate with the mobile device using
the communication reference outside the electronic
payment processing network;
(i) compressing, by the computing apparatus, the second
transaction data into a set of factor values by:
U) computing a first set of values of a set of
predefined spending variables for the first transaction
data of the plurality of first users, wherein each value in
the first set computed for a respective one of the
predefined spending variables identifies a total spending
amount, or a spending frequency, of a respective user in
the plurality of first users in a respective predefined
merchant category during the first period of time;
(k) performing a factor analysis of the predefined
spending variables based on the first set of values;
(1) identifying, from the factor analysis, a set of factor
variables that are substantially fewer than the set of
predefined spending variables, wherein each of the
factor variables is a respective combination of the set of
predefined spending variables determined from the factor
analysis;
(m) computing a second set of values of the set of
predefined spending variables for the second transaction
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data of the second user, wherein each value in the second
set computed for a respective one of the predefined
spending variables identifies a total spending amount, or
a spending frequency, of the second user in the respective
predefined merchant category during the second period
of time; and
(n) computing the factor values of the set of factor
variables for the second transaction data by using the
second set of values in the respective combination of the
set of predefined spending variables determined from the
factor analysis;
( o) generating, by the profile generator, a profile of the
second user using the set of factor values;
(p) processing, by the transaction handler, authorization of a
first transaction in the account of the second user initiated on a
point of sale terminal, including:
(q) receiving, by the transaction handler, an
authorization request for the first transaction of the
second user transmitted in the electronic payment
processing network from the point of sale terminal;
(r) obtaining, by the transaction handler using the
electronic paymentprocessing network, an authorization
response from a computer controlling the account of the
second user in the electronic payment processing
network; and
(s) transmitting, by the transaction handler, the
authorization response to the point of sale terminal via
the electronic payment processing network; and
(t) during the processing of the authorization of the first
transaction by the transaction handler,
(u) identifying, by the computing apparatus, an
advertisement for a first advertiser of a plurality of advertisers
based at least in part on the profile of the second user;
( v) identifying the communication reference based on:
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( w) the account identified in the authorization request
for the first transaction, and
(x) the registration data stored in the data warehouse
associating the communication reference with the
account;
(y) instructing, by the transaction handler, the portal to
communicate with the mobile device using the communication
reference; and
( z) transmitting, by the portal, the advertisement to the
mobile device using the communication reference without
going through the point of sale terminal, to cause the mobile
device to present the advertisement in real time with the
processing of the authorization of the first transaction.
App. Br. 23-25 (Claims App'x).
Rejections on Appeal3
Claims 1 and 3-19 stand rejected under 35 U.S.C. § 101 as being
directed to a judicial exception (i.e., an abstract idea) without significantly
more. 4 Final Act. 4--7.
Claims 1 and 3-195 stand rejected under 35 U.S.C. § 112, second
paragraph, as being indefinite for failing to particularly point out and
3 Although the Examiner rejected claims 1-19 under 35 U.S.C. § 112, first
paragraph, for failure to comply with the written description requirement and
rejected claims 1, 16, and 17 under 35 U.S.C. § 112, second paragraph, for
indefiniteness based on the term "compressing," these rejections have been
withdrawn by the Examiner. Ans. 3.
4 The Examiner also finds that claim 17 is directed to software per se, which
is not one of the four categories of statutory subject matter, and states that
"[a]ppropriate correction is required." Final Act. 7. Our decision, infra,
concerning the Examiner's rejection of claims 1 and 3-19 under§ 101 is
dispositive of this issue.
5 Claims 18 and 19 were not listed in this rejection by the Examiner, but we
have included them because we believe these claims, which depend from
claim 17, were inadvertently omitted by the Examiner.
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distinctly claim that which the applicant regards as the invention. Final Act.
8-9.
Claims 1, 3-12, and 16-19 stand rejected under 35 U.S.C. § I03(a) as
being unpatentable over Fordyce et al. (US 2008/0059306 Al; published
Mar. 6, 2008) ("Fordyce"), Hammad et al. (US 2008/0005037 Al; published
Jan. 3, 2008) ("Hammad"), Yaskin (US 2009/0281873 Al; published Nov.
12, 2009), and Blume et al. (US 6,839,682 Bl; issued Jan. 4, 2005)
("Blume"). Final Act. 9-23.
Claims 13-15 stand rejected under 35 U.S.C. § I03(a) as being
unpatentable over Fordyce, Hammad, Yaskin, Blume, and Levine (US
2008/0275771 Al; published Nov. 6, 2008).
ANALYSIS
We have reviewed the Examiner's rejections in light of Appellants'
arguments in the Appeal Brief (see App. Br. 5-22) and the Reply Brief (see
Reply Br. 3-10). Regarding the Examiner's rejections under 35 U.S.C.
§§ 101 and I03(a), unless otherwise noted, we adopt as our own the findings
and reasons set forth by the Examiner in the Office Action from which this
appeal is taken (Final Act. 2-7, 9-24), and in the Examiner's Answer (Ans.
4--7), and we concur with the conclusions reached by the Examiner.
However, we do not agree with, or adopt, the Examiner's findings and
conclusion regarding the rejection under 35 U.S.C. § 112, second paragraph.
I. Section 101 Rejection
A. Applicable Law
Section 101 of the Patent Act provides that "any new and useful
process, machine, manufacture, or composition of matter, or any new and
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useful improvement thereof' is patent eligible. 35 U.S.C. § 101. But the
Supreme Court has long recognized an implicit exception to this section:
"Laws of nature, natural phenomena, and abstract ideas are not patentable."
Alice Corp. v. CLSBankint'l, 573 U.S. 208,216 (2014) (quotingAss'nfor
Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. 576, 589 (2013)).
To determine whether a claim falls within one of these excluded categories,
the Court has set out a two-part framework. The framework requires us first
to consider whether the claim is "directed to one of those patent-ineligible
concepts." Alice, 573 U.S. at 217. If so, we then examine "the elements of
[the] claim both individually and 'as an ordered combination' to determine
whether the additional elements 'transform the nature of the claim' into a
patent-eligible application." Alice, 573 U.S. at 217 (quoting Mayo
Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66, 78, 79 (2012)).
That is, we examine the claim for an "inventive concept," "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, 573 U.S. at 217-18 ( alteration in original) ( quoting
Mayo, 566 U.S. at 72-73).
The Patent Office recently issued guidance about this framework. See
2019 Revised Patent Subject Matter Eligibility Guidance, 84 Fed. Reg. 50
(Jan. 7, 2019) ("Revised Guidance"). Under the Revised Guidance, to
decide whether a claim is directed to an abstract idea, we evaluate whether
the claim ( 1) recites one of the abstract ideas listed in the Revised Guidance
("Prong One") and (2) fails to integrate the recited abstract idea into a
practical application ("Prong Two"). See Revised Guidance, 84 Fed. Reg. at
51, 54. If the claim is directed to an abstract idea, as noted above, we then
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determine whether the claim has an inventive concept. The Revised
Guidance explains that when making this determination, we should consider
whether the additional claim elements add "a specific limitation or
combination of limitations that are not well-understood, routine,
conventional activity in the field" or "simply append[] well-understood,
routine, conventional activities previously known to the industry, specified
at a high level of generality." Revised Guidance, 84 Fed. Reg. at 56.
With these principles in mind, we first analyze whether claim 1 is
directed to an abstract idea. 6
B. Abstract Idea
In analyzing the limitations of the claims, the Examiner finds that the
claims are directed to multiple abstract ideas. See Final Act. 4--5. In
particular, the Examiner finds the claims are "directed to an abstract idea:
collecting (first transaction data and second transaction data ... comparing
(profile based on first and second transaction), identifying advertisement, i.e.
collecting and comparing data." Id. at 4. The Examiner also finds that
"[t]he claims include the abstract idea of comparing new and stored
information and using rules to identify options ( transmitting ...
advertisement)." Id. The Examiner further finds the claims are directed to
"applying factor definitions to values, clustering, generating data, i.e.
generating profile," which is organizing data by mathematical correlation.
Id. at 5. Moreover, the Examiner finds that the claims are directed "to
comparing 2 points of contact, here second user profile based on first user
6 Appellants argue claims 1 and 3-19 together, focusing on representative
claim 1. App. Br. 5-22. Thus, we decide the appeal based on claim 1. See
37 C.F.R. § 4I.37(c)(l)(iv).
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data and second user data." Id. In addition, the Examiner finds that "the
claims as a whole are directed to the fundamental economic practice of
targeted marketing - which is organizing human activity." Id.; see also Ans.
4--5.
Appellants argue that the Examiner overgeneralizes claim 1 and
improperly asserts that claim 1 describes something any human could do.
App. Br. 5. To the contrary, according to Appellants, claim 1 "describes
how a machine functions to reduce a set of voluminous transaction data into
a transaction profile having a significantly smaller size" and uses the profile
for improved electronic communications related to transaction information."
Id. (emphasis omitted); see also id. at 8, Reply Br. 3. Appellants also argue
that the Examiner erred by splitting the claim elements into two sets, one for
stage one and the other for stage two, and then considering them in isolation,
instead of using an overlapping consideration of elements so that the claim is
viewed as an ordered combination and as a whole, without ignoring the
individual steps. App. Br. 8-10.
1. USPTO Step 2A, Prong One
Beginning with prong one of the first step of Alice, we must determine
"whether the claims at issue are directed to one of those patent-ineligible
concepts," including the abstract ideas enumerated in the Revised Guidance.
Alice, 573 U.S. at 217. One of the subject matter groupings identified as an
abstract idea in the Revised Guidance is "mental processes----concepts
performed in the human mind (including an observation, evaluation,
judgment, opinion)." See Revised Guidance, 84 Fed. Reg. at 52, 53. The
Revised Guidance explains that "mental processes" include acts that people
can perform in their minds or using pen and paper, even if the claim recites
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that a generic computer component performs the acts. See Revised
Guidance, 84 Fed. Reg. at 52 n.14 ("If a claim, under its broadest reasonable
interpretation, covers performance in the mind but for the recitation of
generic computer components, then it is still in the mental processes
category unless the claim cannot practically be performed in the mind.")
Claim 1 recites limitations (a}-(z), which are reproduced in full above.
Because people can perform the functions recited in several of these
limitations using their minds or pen and paper, they are directed to the
abstract idea of "mental processes."
For example, limitation ( c) recites the step of "storing" the
following: ( d) "first transaction data recording payment transactions of a
plurality of first users ... during a first period of time," ( e) "second
transaction data recording payment transactions of a second user ... during
a second period of time," and (f) "registration data associating an account of
the second user with a communication reference of a mobile device of the
second user." App. Br. 23 (Claims App'x). A person can perform these
functions by writing down on paper the details of payment transactions for a
group of first users during a first time period and the details of payment
transactions for a second user for a second time period, and also noting the
association of the account of the second user with the telephone number of
the mobile device of the second user.
The Revised Guidance also identifies the subject matter grouping of
"mathematical concepts-mathematical relationships, mathematical
formulas or equations, mathematical calculations"-as an abstract idea. See
Revised Guidance, 84 Fed. Reg. at 52. Here, several of the limitations of
claim 1 recite mathematical relationships or calculations. For example,
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limitation (i) recites "compressing ... the second transaction data into a set
of factor values by" performing five steps: U) "computing a first set of
values of a set of predefined spending variables for the first transaction data
of the plurality of first users, wherein each value in the first set computed for
a respective one of the predefined spending variables identifies a total
spending amount, or a spending frequency, of a respective user in the
plurality of first users in a respective predefined merchant category during
the first period of time;" (k) "performing a factor analysis of the predefined
spending variables based on the first set of values;" (1) "identifying, from the
factor analysis, a set of factor variables that are substantially fewer than the
set of predefined spending variables, wherein each of the factor variables is a
respective combination of the set of predefined spending variables
determined from the factor analysis;" (m) "computing a second set of values
of the set of predefined spending variables for the second transaction data of
the second user, wherein each value in the second set computed for a
respective one of the predefined spending variables identifies a total
spending amount, or a spending frequency, of the second user in the
respective predefined merchant category during the second period of
time;" and (n) "computing the factor values of the set of factor variables for
the second transaction data by using the second set of values in the
respective combination of the set of predefined spending variables
determined from the factor analysis."
The term "computing," which is used in limitations U), (m), and (n),
means "to determine especially by mathematical means." See WEBSTER'S
NINTH NEW COLLEGIATE DICTIONARY, 271 (1985). The Specification also
describes "computing" as a mathematical calculation. For example, in
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describing that transaction profiles 127 of Figure 1 include the values for a
set of parameters, the Specification states that "[ c ]omputing the values of the
parameters may involve counting transactions that meet one or more criteria,
and/or building a statistically-based model in which one or more calculated
values or transformed values are put into a statistical algorithm." Spec. ,r 54.
Similarly, the Specification discloses that performing a "factor analysis," as
in limitation (k), comprises "statistical analysis," which involves
mathematical calculations. Id. at ,r 281. Moreover, the Specification
describes that "identifying, from the factor analysis, a set of factor variables
that are "substantially fewer" than the set of predefined spending variables,
as recited in limitation (1), involves a mathematical relationship between the
"factor variables" and the "predefined spending variables." Id. at ,r 290. In
that regard, paragraph 290 of the Specification states that thousands of
spending variables are reduced to a factor number "less than one hundred
(and even less than twenty)," and in one example, "twelve factors to
combine the thousands of the original variables." Id.
Limitation ( o) recites "generating ... a profile of the second user
using the set of factor values." This step of claim 1 could be performed in
the mind of a person based on such person's consideration and evaluation of
the set of factor values. Indeed, Appellants' Specification discloses that
"[t]he summarized data can be readily interpreted by a human to ascertain
the spending behavior of the cardholder." Spec. ,r 291.
Moreover, limitations (p }-(z) pertain to the fundamental economic
practice of sales, marketing, and advertising activities. In general, these
limitations recite processing the authorization of a transaction in the account
of the second user and, during the processing of the transaction, identifying
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an advertisement based on the profile of the second user, and transmitting
the advertisement to the second user's mobile device.
In particular, limitations (p }-( s) recite: (p) "processing ...
authorization of a first transaction in the account of the second user initiated
on a point of sale ('POS') terminal," including (q) "receiving ... an
authorization request" for the transaction from the POS terminal, ( r)
"obtaining ... an authorization response," and (s) "transmitting ... the
authorization response to the POS terminal." Further, limitations (t}-(z)
recite: (t) "during the processing of the authorization of the first
transaction," (u) "identifying ... an advertisement ... based at least in part
on the profile of the second user," (v-x) "identifying" the communication
reference of the second user's mobile device, (y) "instructing ... the portal
to communicate with the mobile device using the communication reference,"
and (z) "transmitting, by the portal, the advertisement to the mobile device
... without going through the POS terminal, to cause the mobile device to
present the advertisement in real time with the processing of the
authorization of the first transaction."
Claim 1 is, therefore, directed to a combination of features that we
conclude are similar or analogous to claims in other cases that courts have
found are directed to an abstract idea. The Federal Circuit has found claims
reciting collecting and manipulating data, and mathematical relationships
and calculations, as being directed to abstract ideas. See, e.g., Intellectual
Ventures I LLC v. Capital One Fin. Corp., 850 F.3d 1332, 1340 (Fed. Cir.
201 7) (identifying the abstract idea of collecting, displaying, and
manipulating data); Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d 1350,
1354 (Fed. Cir. 2016) (characterizing collecting information, analyzing
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information by steps people go through in their minds, or by mathematical
algorithms, and presenting the results of collecting and analyzing
information, without more, as matters within the realm of abstract ideas);
Bancorp Servs., L.L.C. v. Sun Life Assurance Co. of Can. (U.S.), 687 F.3d
1266, 1278 (Fed. Cir. 2012) ("[T]he fact that the required calculations could
be performed more efficiently via a computer does not materially alter the
patent eligibility of the claimed subject matter."); see also SAP America, Inc.
v. InvestPic, LLC, 898 F.3d 1161, 1168 (Fed. Cir. 2018) ("As many cases
make clear, even if a process of collecting and analyzing information is
'limited to particular content' or a particular 'source,' that limitation does
not make the collection and analysis other than abstract." (quoting Elec.
Power Grp., 830 F.3d at 1353, 1355 (citing cases)).
Targeting customers with particular targeted advertisements also is a
longstanding marketing and advertising practice, and is substantially similar
to economic practices that the courts have found patent-ineligible. See, e.g.,
Morsa v. Facebook, Inc., 77 F. Supp. 3d 1007, 1013 (CD. Cal. 2014), aff'd,
622 F. App'x 915 (Fed. Cir. 2015) (concluding that targeting advertisements
to certain consumers is no more than an abstract idea); Ultramercial, Inc. v.
Hulu, LLC, 772 F.3d 709, 713 (Fed. Cir. 2014) (offering media content in
exchange for viewing an advertisement); Intellectual Ventures I LLC v.
Capital One Bank (USA), 792 F.3d 1363, 1370 (Fed. Cir. 2015) (tailoring
information presented to a user based on particular information); Affinity
Labs of Texas, LLC v. Amazon.com, Inc., 838 F.3d 1266, 1271 (Fed. Cir.
2016) ( customizing a user interface to have targeted advertising based on
user information).
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Thus, we are not persuaded by Appellants' argument that the
Examiner overgeneralizes claim 1, or fails to consider claim 1 as a whole,
because the Examiner analyzed the limitations individually and collectively.
See Final Act. 4--5. Based on the analysis above, we agree with the
Examiner's findings that the individual limitations of claim 1 recite several
abstract ideas, including mental processes and mathematical concepts
( functions or operations that could be performed in the human mind or with
pen and paper, including mathematical calculations), and fundamental
economic practices of sales activities and targeted advertising. In that
regard, we note that merely combining several abstract ideas does not render
the combination any less abstract. RecogniCorp, LLC v. Nintendo Co., Ltd.,
855 F.3d 1322, 1327 (Fed. Cir. 2017) ("Adding one abstract idea ... to
another abstract idea ... does not render the claim non-abstract."); see also
FairWarning IP, LLC v. Iatric Sys., Inc., 839 F.3d 1089, 1094 (Fed. Cir.
2016) ( determining the pending claims were directed to a combination of
abstract ideas). We also agree with the Examiner that, as a whole, the
limitations of claim 1 "are directed to the fundamental economic practice of
targeted marketing- which is organizing human activity." Id. at 5
( emphasis omitted). Accordingly, we conclude that claim 1 recites a method
of organizing human activity-targeted advertising based on a user's profile
determined from the user's spending behavior- one of the abstract idea
groupings in the Revised Guidance. See Revised Guidance, 84 Fed. Reg. at
52. Thus, we also conclude that claim 1 recites an abstract idea.
2. USPTO Step 2A, Prong Two
Because we determine that claim 1 recites an abstract idea, we tum to
prong two of the first step of the Alice analysis and consider whether claim 1
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integrates this abstract idea into a practical application. See Revised
Guidance, 84 Fed. Reg. at 51. In doing so, we consider whether there are
any additional elements beyond the abstract idea that, individually or in
combination, "integrate the [ abstract idea] into a practical application, using
one or more of the considerations laid out by the Supreme Court and the
Federal Circuit."7 Revised Guidance, 84 Fed. Reg. at 54--55.
The Examiner finds that the additional elements recited in the claims
other than the abstract idea are "computing apparatus, medium," that "are
not sufficient to amount to significantly more than the judicial exception
because the claims do not provide improvements to another technology or
technical field, improvements to the functioning of the computer itself, and
do not provide meaningful limitations beyond general linking the use of an
abstract idea to a particular technological environment." Final Act. 5; see
also id. at 6. The Examiner also finds that the claims do not add meaningful
limitations to the abstract idea "because they require no more than a generic
computer to perform generic computer functions that are well understood,
routine, and conventional activities previously known to the industry. Id.
Appellants argue the claimed invention "is directed to 'computer-
related technology' by providing a particular solution to a problem of
reducing a set of voluminous transaction data into a transaction profile
having a significantly smaller size." App. Br. 8. Appellants also argue that
the computer system of the claimed invention "has a function not previously
7 We acknowledge that some of these considerations may be properly
evaluated under step 2 of Alice (step 2B of the Revised Guidance). Solely
for purposes of maintaining consistent treatment within the Office, we
evaluate it under step 1 of Alice (step 2A, prong two, of the Revised
Guidance). See Revised Guidance, 84 Fed. Reg. at 54--55.
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performable by a computer," and is patent eligible for the rationale stated in
McRO. 8 Appellants further argue that the claimed invention has a
computing apparatus "having components that are able in combination to
perform 'functions that are not merely generic (DDR)' 9." Id. at 13
( emphasis deleted). Thus, according to Appellants, "the claims inventions
are significantly more than an abstract idea (and thus eligible)." Id.
( emphasis deleted).
We are not persuaded by these arguments. First, Appellants have
failed to demonstrate that the operations of claim 1, in which, as Appellants
argue, "a set of voluminous transaction data [is reduced] into a transaction
profile having a significantly smaller size," invoke any asserted inventive
programming, require any specialized computer hardware or other inventive
computer components, i.e, a particular machine, or that the claimed
invention is performed using other than generic computer components. Nor
have Appellants identified any disclosure in the Specification of any
inventive techniques or specialized computer components to perform the
claimed operations of claim 1, including "compressing" the transaction data
into "a set of factor values," performing a "factor analysis," or "generating"
a profile of the second user.
Second, we are not persuaded claim 1 is analogous or similar to the
claim in McRO that the court determined was not directed to an abstract
idea. In McRO, the Federal Circuit concluded that the claim, when
considered as a whole, was directed to a "technological improvement over
8 McRO, Inc. v. Bandai Namco Games America Inc., 837 F.3d 1299 (Fed.
Cir. 2016).
9 DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245 (Fed. Cir. 2014).
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the existing, manual 3-D animation techniques" and "uses the limited rules
in a process specifically designed to achieve an improved technological
result in conventional industry practice." McRO, 837 F.3d at 1316.
Specifically, the Federal Circuit found that the claimed rules allow
computers to produce accurate and realistic lip synchronization and facial
expressions in animated characters that previously could only be produced
by human animators; and the rules are limiting because they define morph
weight sets as a function of phoneme sub-sequences. Id. at 1313.
Here, Appellants have not identified any analogous improvement that
is attributable to the claimed invention. Although compressing transaction
data and generating a second user profile as recited in claim 1 may improve
a business process, i.e., developing targeted advertisements to send to the
second user in "real time," it does not achieve an improved technological
result. We see no parallel between the limiting rules described in McRO and
compressing first and second user transaction data to generate a profile and
advertisement for the second user, as recited in claim 1.
Third, Appellants do not assert that claim 1 requires an arguably
inventive device or technique for displaying information or new techniques
for analyzing or compressing transaction data. Thus, this case is unlike
DDR in which an inventive concept was found in the modification of
conventional mechanics behind website displays to produce a dual-source
integrated hybrid display. See DDR, 773 F.3d at 1257. We also agree with
the Examiner's findings that DDR addressed a technological problem
"particular to the internet," whereas here Appellants simply take pre-internet
"mathematical concepts of factor analysis and cluster analysis from the
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paper and pencil era and appl[y] that to card data for sending content ( an
ad)." Final Act. 7.
Appellants do not specifically argue that the Examiner erred in
determining claim 1 recites "computing apparatus, medium," that perform
generic computer functions that are well understood, routine, and
conventional activities. See Final Act. 5---6. We see nothing in the claims or
the Specification that suggests otherwise. Thus, we determine that the
additional elements recited in claim 1 of "a computing apparatus,"
comprising inter alia "a transaction handler," "a profile generator," "a
portal," "a point of sale terminal," and "a mobile device" do not integrate the
recited abstract idea into a practical application. See Affinity Labs of Tex.,
LLC v. DIRECTV, LLC, 838 F.3d 1253, 1262 (Fed. Cir. 2016) ("In this case,
the claims are directed not to an improvement in cellular telephones but
simply to the use of cellular telephones as tools in the aid of a process
focused on an abstract idea. That is not enough to constitute patentable
subject matter."); Revised Guidance, 84 Fed. Reg. at 55 (explaining that
courts have identified "merely us[ing] a computer as a tool to perform an
abstract idea" as an example of when a judicial exception may not have been
integrated into a practical application). Further, consistent with the
Examiner's findings, and in view of Appellants' Specification ( e.g., ,r,r 343-
344, 346, 421--424), we conclude that claim 1 does not integrate the judicial
exception into a practical application. In particular, we determine claim 1
does not recite:
(i) an improvement to the functioning of a computer;
(ii) an improvement to another technology or technical field;
(iii) an application of the abstract idea with, or by use of, a
particular machine;
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(iv) a transformation or reduction of a particular article to a
different state or thing; or
(v) other meaningful limitations beyond generally linking the
use of the abstract idea to a particular technological
environment.
See MPEP §§ 2106.05(a}-(c), (e}-(h).
3. USP TO Step 2B - Inventive Concept
Finally, we consider whether claim 1 has an inventive concept, that is,
whether any additional claim elements "'transform the nature of the claim'
into a patent-eligible application." Alice, 573 U.S. at 217 (quoting Mayo,
566 U.S. at 78, 79). This requires us to evaluate whether the additional
claim elements add "a specific limitation or combination of limitations that
are not well-understood, routine, conventional activity in the field" or
"simply append[] well-understood, routine, conventional activities
previously known to the industry, specified at a high level of generality."
Revised Guidance, 84 Fed. Reg. at 56.
The Examiner finds that the claims do not include additional elements
that are sufficient to amount to significantly more than the abstract idea.
Final Act. 5-6. In particular, the Examiner finds that the "generically recited
computer elements do not add a meaningful limitation to the abstract idea
because they would be routine in any computer implementation." Id. at 6.
The Examiner also finds that the claim limitations "do not improve the
technical field" and "require no more than a generic computer to perform
generic computer functions that are well-understood, routine, and
conventional activities." Id. Contrary to Appellants' argument that the
claims include an ordered combination that is significantly more, the
Examiner finds that the claims simply involve "implementing an idea by
computer," which is not an ordered combination demonstrating an
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innovative concept to ensure that the claim[ s] amount[] to significantly
more." Id.
Appellants argue that, even if the claims were directed to an abstract
idea, the claims have significantly more "because the claimed invention
involves non-generic computer implementation. The claimed
implementation is not routine, conventional and well-understood." App. Br.
14. However, Appellants do not point to, nor do we find, anything in the
claims or the Specification suggesting that the claimed computer apparatus
is anything but generic computer components that perform well-understand,
routine, and conventional activities. See, e.g., Spec. ,r,r 343-344, 346, 421-
424). Moreover, Appellants' arguments are conclusory and unsupported by
persuasive evidence and technical reasoning. As a result, considering claim
1 as a whole, we agree with the Examiner and determine that the additional
elements recited in claim 1 do not provide "a specific limitation or
combination of limitations that are not well-understood, routine,
conventional activity in the field." Revised Guidance, 84 Fed. Reg. at 56.
Rather, these elements "simply append[] well-understood, routine,
conventional activities previously known to the industry, specified at a high
level of generality." Revised Guidance, 84 Fed. Reg. at 56. Accordingly, we
agree with the Examiner that claim 1 does not have an inventive concept.
5. Conclusion
Because we determine that claim 1 is directed to an abstract idea and
does not contain an inventive concept, we sustain the Examiner's rejection
of claim 1 under § 101. Appellants rely on the same reasoning regarding the
rejection of independent claims 16 and 17 as set forth regarding claim 1. See
App. Br. 14--15. Thus, for the same reasons discussed regarding claim 1, we
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also sustain the Examiner's rejection of claims 16 and 17 under§ 101. For
the same reasons, we also sustain the Examiner's rejection of dependent
claims 3-15, 18, and 19, which are not separately argued.
II. Section 112 Rejection
The Examiner rejects claims 1 and 3-19 for indefiniteness under
35 U.S.C. § 112, second paragraph, because the term "substantially fewer,"
as recited in independent claims 1, 16, and 17, is vague and indefinite. Final
Act. 8. The Examiner finds that persons of ordinary skill in the art could
come to different conclusions about what constitutes "substantially fewer"
because it could mean a data reduction in one, two, or three orders of
magnitude. Id.
Appellants argue that claim terms of degree are not necessarily
indefinite if the specification provides examples that can be used to measure
degree even without precise numerical measurement. App. Br. 17 ( citing
MPEP § 2173 .05 (b )). Appellants also argue that the Specification provides
sufficient examples so that a person of ordinary skill in the art would have
no difficulty in determining what is the "substantially fewer" set of factor
variables needed to practice factor analysis in the claimed invention. Id.
( citing Spec. ,r,r 289-290); Reply Br. 7.
We are persuaded by Appellants' arguments that the Examiner erred.
Terms of degree like "substantially" and "about" do not necessarily render
claims indefinite. See, e.g., Deere & Co. v. Bush Hog, LLC, 703 F.3d 1349,
1359 (Fed. Cir. 2012) ("This court has repeatedly confirmed that relative
terms such as 'substantially' do not render patent claims so unclear as to
prevent a person of skill in the art from ascertaining the scope of the
claim."). These terms are sufficiently definite when, for example, the
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associated specification provides a standard for measuring the degree. See,
e.g., Seattle Box Co. v. Indus. Crating & Packing, Inc., 731 F.2d 818,826
(Fed. Cir. 1984). Mathematical precision is not required; the specification
must simply provide sufficient certainty to one of ordinary skill in the art.
See Interval Licensing LLC v. AOL, Inc., 766 F.3d 1364, 1370 (Fed. Cir.
2014).
We determine that Appellants' Specification satisfies this standard.
Paragraph 290 of the Specification discloses, for example, that "there may
be thousands of variables on spending frequency and amount" and the factor
analysis can "reduce the factor number to less than one hundred ( and even
less than twenty)." This paragraph also discloses, in another example, that
"a twelve-factor solution is obtained," so that "the spending behavior in
thousands of merchant categories can be summarized via twelve factor
values." Thus, Appellants' Specification discloses examples that can be
used to determine when the factors are "substantially fewer" than the
spending variables-a range from thousands of spending variables to one
hundred, twenty, or twelve factors. Although this is not a precise definition
of how much the spending variables must be reduced, such precision is not
required, and the examples provide sufficient, and objective, certainty as to
the magnitude of the reduction for there to be "substantially fewer" factors
than spending variables. Furthermore, our reviewing court points out that a
claim which is of such breadth that it reads on subject matter disclosed in the
prior art is rejected under 35 U.S.C. §§ 102 or 103 rather than under
35 U.S.C. § 112, second paragraph. See In re Hyatt, 708 F.2d 712, 715
(Fed. Cir. 1983).
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Accordingly, we do not sustain the Examiner's rejection of claims 1
and 3-19 under§ 112, second paragraph.
III. Section 103(a) Rejections
The Examiner rejects claims 1, 3-12, and 16-19 for obviousness over
the combination of Fordyce, Hammad, Y askin, and Blume. 1 ° Final Act. 9.
The Examiner finds that Fordyce does not teach "factor analysis," as recited
in claim 1, but Y askin does. Id. at 13-15. In particular, the Examiner finds
that Y askin teaches compressing the second transaction data into a set of
factor values by performing a factor analysis of the predefined spending
variables based on the first set of values. Id. at 13-14 (citing Yaskin ,r 4 (as
teaching the first time and first transactions), and Y askin ,r,r 4--12 ( as
teaching the second time, second transactions)).
Appellants argue that Yaskin "does not teach or suggest compressing
second transaction data using values for first users and a second user, as
claimed," but "solely focuses on analyzing data for a single student." App.
Br. 20 ( citing Yaskin ,r,r 3--4); Reply Br. 8. According to Appellants, the
Examiner is misreading Y askin' s "second student" to imply a second person,
and a person of ordinary skill would recognize that "Y akin uses the word
'second' only to modify the additional recommendations provided to the
same single student that receives the first recommendations." Reply Br. 8-
9.
We are not persuaded by Appellants' arguments that the Examiner
erred. Instead, we agree with the Examiner that Y askin teaches a first
student and that the first student is the training set for other students,
10 The Examiner rejects claims 13-15, which depend from claim 1, for
obviousness over the same four references, as well as Levine. Final Act. 23.
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including the "second student." Ans. 7 ( citing Yaskin ,r,r 4, 11 ). In that
regard, we agree with the Examiner that Y askin teaches providing
recommendations to more than one student because paragraph 4 of Y askin
states that systems and methods of the disclosure "relate to providing
spending information and budgeting recommendations to students based
upon financial account usage associated with a student's personal
identification card." (Emphasis added). We also agree with the Examiner
that Y askin teaches providing recommendations to more than one student
because paragraph 11 of Y askin discloses "compar[ ing] the student account
usage with the first student spending recommendations" and "provid[ing]
one or more second student spending recommendations" based in part "on
the student role and the compared student financial account usage with the
first student spending recommendations." (Emphasis added). We
understand these disclosures of Yaskin to teach or at least suggest analyzing
the transactions of more than one student and making spending
recommendations in part based on the second student's role and the
compared second student's financial usage with the spending
recommendations to the first student.
Accordingly, for these reasons, we sustain the Examiner's rejections
of claims 1, 16, and 17, and claims 3-15, 18, and 19, which depend from
either claim 1 or claim 17, under§ 103(a).
DECISION
We affirm the Examiner's rejection of claims 1 and 3-19 under
35 U.S.C. § 101.
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We reverse the Examiner's rejection of claims 1 and 3-19 under
35 U.S.C. § 112, second paragraph.
We affirm the Examiner's rejection of claims 1 and 3-19 under
35 U.S.C. § 103(a).
No period for taking any subsequent action in connection with this
appeal may be extended under 37 C.F.R. § 1.136(a)(l)(iv). See 37 C.F.R.
§ 41.50(±).
AFFIRMED
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