Ex Parte Johnson

Patent Trials and Appeals Board

Jan 29, 2019

12289674 - (D) (P.T.A.B. Jan. 29, 2019)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE FIRST NAMED INVENTOR
12/289,674 10/31/2008
75127 7590 01/31/2019
DENTONS US LLP (CITI CUSTOMER NUMBER)
ATTN: Eric Sophir
P.O. BOX 061080
CHICAGO, IL 60606-1080
William Johnson
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.
CITI0332-US 2312
EXAMINER
SUBRAMANIAN, NARAYANSWAMY
ART UNIT PAPER NUMBER
3695
NOTIFICATION DATE DELIVERY MODE
01/31/2019 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):
eric.sophir@dentons.com
patents.us@dentons.com
#sg.citi-docket@dentons.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte WILLIAM JOHNSON
Appeal 2017-011308
Application 12/289,674 1
Technology Center 3600
Before ELENI MANTIS MERCADER, NORMAN H. BEAMER, and
ADAM J. PYONIN, Administrative Patent Judges.
BEAMER, Administrative Patent Judge.
DECISION ON APPEAL
Appellant appeals under 35 U.S.C. § 134(a) from the Examiner's
Non-Final Rejection of claims 1---6, 11, 12, and 14. We have jurisdiction
over the pending rejected claims under 35 U.S.C. § 6(b ).
We affirm.
1 Appellant identifies Citibank, N. A. as the real party in interest. (App.
Br. 1.)
Appeal 2017-011308
Application 12/289,674
THE INVENTION
Appellant's disclosed and claimed invention is directed to calculating
and collecting a fee interchange adjustment as it relates to private label
accounts, including enabling a private label card account with a partner by a
card issuer through a card association network with a special program fee.
(Abstract.)
Independent claims 1 and 14, reproduced below, are illustrative of the
subject matter on appeal:
1. A computer-implemented method comprising:
receiving, by a card issuer processing system processor,
transaction data with a merchant from a transaction terminal
having a card reader through which a private label transaction
card is swiped in connection with a transaction, the transaction
data being transmitted to the card issuer processing platform
processor from the card association processing system
processor via an acquiring financial institution processor;
determining, by the card issuer processing system
processor, an established interchange fee for the transaction
with the merchant;
determining, by the card issuer processing platform
processor, whether the merchant and an account for the private
label transaction card are associated with a special program fee;
calculating, by the card issuer processing platform
processor, a difference between the established interchange fee
and the special program fee; and
generating and transmitting, by the card issuer processing
platform processor, a message in a proprietary format of the
card association processing system processor, the message
comprising a reason code field and a message text field,
wherein data in the reason code field represents a type of
adjustment and data in the message text field represents a
description of a purpose of the message and an identifier of the
merchant, wherein the message is transmitted through the card
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Application 12/289,674
association processing system processor to an acquirer
processor and instructs the acquirer processor to process an
adjustment of an amount of the calculated difference for credit
or debit to an account of the merchant at the acquirer processor.
14. A system comprising:
an acquiring financial institution processor configured for
maintaining a private label card account of a merchant;
a card issuer platform processor configured for receiving
transaction data with a merchant from a transaction terminal
having a card reader through which a private label transaction
card is swiped in connection with a transaction, the transaction
data being transmitted to the card issuer platform processor
from the card association network processor via the acquiring
financial institution processor;
determining an established interchange fee for the
transaction with the merchant; determining whether the
merchant and an account for the private label transaction card
are associated with a special program fee; calculating a
difference between the special program fee and the established
interchange fee; and generating and transmitting a message in a
proprietary format of the card association network processor,
the message comprising a reason code field and a message text
field, wherein data in the reason code field represents a type of
adjustment and data in the message text field represents a
description of a purpose of the message and an identifier of the
merchant, wherein the message is transmitted through the card
association network processor to the acquiring financial
institution processor and instructs the acquiring financial
institution processor to process an adjustment of an amount of
the calculated difference for credit or debit to an account of the
merchant at the acquiring financial institution processor; and
a card association network processor configured for
processing transactions using the private label card account at
the merchant that were forwarded from the acquiring financial
institution processor, transmitting the private label card account
transactions to a card issuer platform processor, assessing the
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Application 12/289,674
standard interchange fee to the acquiring financial institution
processor for transactions using the association card with the
card association network processor, and transmitting the
adjustment from the card issuer to the acquiring financial
institution processor.
REJECTIONS
The Examiner rejected claim 14 under 35 U.S.C. § 112, second
paragraph, as being incomplete for omitting essential structural cooperative
relationships. (Non-Final Act. 2.)
The Examiner rejected claims 1---6, 11, 12, and 14 under 35 U.S.C.
§ 101 because the claimed invention is directed to non-statutory subject
matter. (Non-Final Act. 3.)
ISSUES ON APPEAL
Appellant's arguments in the Appeal and Reply Briefs present the
following issues: 2
Issue One: Whether the Examiner erred in finding claim 14
indefinite as omitting essential structural cooperative relationships. (App.
Br. 4--5.)
Issue Two: Whether the Examiner erred in finding claims 1-6, 11,
12, and 14 as directed to non-statutory subject matter. (App. Br. 5-9.)
2 Rather than reiterate the arguments of Appellant and the positions of the
Examiner, we refer to the Appeal Brief (filed May 12, 2017); the Reply
Brief (filed Sept. 5, 2017); the Non-Final Office Action (mailed Sept. 13,
2016); and the Examiner's Answer (mailed July 5, 2017) for the respective
details.
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Application 12/289,674
ANALYSIS
We have reviewed the Examiner's rejections in light of Appellant's
arguments. Arguments Appellant could have made but chose not to make
are deemed to be waived. See 37 C.F.R. § 41.37(c)(l)(iv).
First Issue
The Examiner finds claim 14 incomplete because the "structural
cooperative relationship among the acquiring financial institution processor,
the card issuer platform processor and the card association network
processor is missing in the claim." (Non-Final Act. 2-3.) Appellant argues
that the "relationships are expressly and positively recited" in the claim
because
claim 14 recites that the "card issuer platform processor
configured for receiving transaction data ... being transmitted
to the card issuer platform processor from the card association
network processor via the acquiring financial institution
processor" and "wherein the message is transmitted through the
card association network processor to the acquiring financial
institution processor and instructs the acquiring financial
institution processor to process an adjustment of an amount of
the calculated difference for credit or debit to an account of the
merchant at the acquiring financial institution processor."
(Reply Br. 2.)
We are persuaded the Examiner errs, because Appellant demonstrates
that claim 14 recites interrelationships among the acquiring financial
institution processor, the card issuer platform processor, and the card
association network processor sufficient to inform one skilled in the art of
the nature of the relationships. Accordingly, we reverse the Examiner's
35 U.S.C. § 112, second paragraph, rejection of claim 14.
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Second Issue
The Examiner determines the claims are patent ineligible under
35 U.S.C. § 101, because the claims "are directed to interchange adjustment
as it relates to private label accounts which is considered to be an abstract
idea similar to the concepts that have been identified by the courts such as
creating and fulfilling a contractual relationship," which is a fundamental
economic practice. (Ans. 3; see also Alice Corp. Pty. Ltd. v. CLS Bank Int 'l,
573 U.S. 208,217 (2014) (Describing the two-step framework "for
distinguishing patents that claim laws of nature, natural phenomena, and
abstract ideas from those that claim patent-eligible applications of those
concepts.").)
After the mailing of the Answer and the filing of the Briefs in this
case, the USPTO published revised guidance on the application of§ 101.
(2019 Revised Patent Subject Matter Eligibility Guidance, 84 Fed. Reg. 50
(Jan. 7, 2019) (hereinafter "Memorandum").) Under the Memorandum, the
Office first looks to whether the claim recites:
(1) any judicial exceptions, including certain groupings of abstract
ideas (i.e., mathematical concepts, certain methods of organizing
human interactions such as a fundamental economic practice, or
mental processes); and
(2) additional elements that integrate the judicial exception into a
practical application (see MPEP § 2106.05(a}-(c), (e}-(h)).
Only if a claim (1) recites a judicial exception and (2) does not integrate that
exception into a practical application, does the Office then look to whether
the claim:
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(3) adds a specific limitation beyond the judicial exception that are not
"well-understood, routine, conventional" in the field (see MPEP
§ 2106.0S(d)); or
(4) simply appends well-understood, routine, conventional activities
previously known to the industry, specified at a high level of
generality, to the judicial exception.
See Memorandum.
We are not persuaded the Examiner's rejection is in error. We adopt
the Examiner's findings and conclusions as our own, and we add the
following primarily for emphasis and clarification with respect to the
Memorandum.
Appellant argues the Examiner errs in determining the claims are
directed to an abstract idea, and the claims are patent eligible "because they
are directed towards improving the payment processing technology by
reciting a specific computer architecture that provides a novel and specific
set of computer-implemented rules to transfer funds to a merchant's
account." (Reply Br. 4 (citing DDR Holdings, LLC v. Hotels.com, L.P., 773
F.3d 1245 (Fed. Cir. 2014)).) Appellant further contends "[t]he pending
claims recite non-generic, non-routine, and non-conventional elements,
which amount to significantly more than any abstract idea." (Reply Br. 6.)
We agree with the Examiner that claim 1 is directed to an abstract
idea. See Ans. 3. The recited steps of "receiving ... transaction data with a
merchant," "determining ... an established interchange fee," "determining .
.. whether the [the parties] are associated with a special program fee,"
"calculating ... a difference," and "generating and transmitting ... a
message [that] instructs the acquirer processor to process an adjustment ...
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for credit or debit" comprise fundamental economic principles or practices
and/or commercial or legal interactions; thus, the claim is directed to the
abstract idea of "certain methods of organizing human activity."
(Memorandum, Section I ( Groupings of Abstract Ideas); see also Spec. ,r 11
("[T]he card issuer is able to negotiate economics directly with its partners
to facilitate some of that value, which may be less than what is standard for
an association card or greater than what is standard for an association
card.").)3
We are unpersuaded by Appellant's arguments that the claims recite
"a specific computer architecture that provides a novel and specific set of
computer-implemented rules" or "recite non-generic, non-routine, and non-
conventional elements, which amount to significantly more than any abstract
idea." While claim 1 recites a "card issuer processing system processor,"
"card issuer processing platform processor," "card association processing
system processor," "acquiring financial institution processor," and "acquirer
3 See also Bilski v. Kappas, 561 U.S. 593, 611 (2010) ("The concept of
hedging, described in claim 1 and reduced to a mathematical formula in
claim 4, is an unpatentable abstract idea .... "); Alice, 573 U.S. at 218
("These claims are drawn to the abstract idea of intermediated settlement.");
buySafe, Inc. v. Google, Inc., 765 F.3d 1350, 1355 (Fed. Cir. 2014) (claims
that "are squarely about creating a contractual relationship----a 'transaction
performance guaranty"' held as "directed to an abstract idea"); Accenture
Glob. Servs., GmbH v. Guidewire Software, Inc., 728 F.3d 1336, 1345 (Fed.
Cir. 2013) ( claims reciting "generalized software components arranged to
implement an abstract concept [ of generating insurance-policy-related tasks
based on rules to be completed upon the occurrence of an event] on a
computer" not patent eligible); Bancorp Servs., L.L. C. v. Sun Life Assur. Co.
of Can. (US.), 687 F.3d 1266, 1277 (Fed. Cir. 2012) (determining a
"'method for managing a life insurance policy comprising' seven steps" is
abstract).
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Application 12/289,674
processor," Appellant points to nothing in the claim or in the disclosure that
indicates (1) a particular computer system architecture, (2) non-generic, non-
routine, and non-conventional elements are used to perform the method, or
(3) any kind of technological improvement. No particular machine is
claimed, in that the disclosure refers only to use of "processors coupled to
memory and to other processors likewise coupled to memory via computer
networks" and generic recitation of "computer program products." (Spec
,r 13.) Nor does the claim recite an additional element or elements that
reflect an improvement in the functioning of a computer, or an improvement
to other technology or technical field. See Ans. 9. Rather, the disputed
limitations are part of the abstract idea itself. See Alice, 573 U.S. at 222 ("In
holding that the process was patent ineligible, we rejected the argument that
'implement[ing] a principle in some specific fashion' will 'automatically
fal[l] within the patentable subject matter of§ 101. "') ( alterations in
original) (quoting Parker v. Flook, 437 U.S. 584, 593 (1978))).)
Accordingly, we determine the claim does not integrate the judicial
exception into a practical application. See Memorandum, Section III(A)(2)
(Prong Two: If the Claim Recites a Judicial Exception, Evaluate Whether
the Judicial Exception Is Integrated Into a Practical Application). Nor do we
find the claim includes a specific limitation or a combination of elements
that amounts to significantly more than the judicial exception itself. See
Memorandum, Section III(B) (Step 2B: If the Claim Is Directed to a Judicial
Exception, Evaluate Whether the Claim Provides an Inventive Concept); see
also Aatrix Software, Inc. v. Green Shades Software, Inc., 890 F.3d 1354,
1359 (Fed. Cir. 2018) (Moore, J., concurring) ("the 'inventive concept'
cannot be the abstract idea itself'). The remaining claim elements only
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recite generic computer components that are well-understood, routine, and
conventional. See Ans. 9; Spec. ,r 13 ("references herein to components,
such as the issuer 130, the merchant-partner 140, the acquirer 150, the card
association's processing system 160, and the issuer's processing platform
include, without limitation, processors coupled to memory and to other
processors likewise coupled to memory via computer networks"); Fig. 1;
Alice, 573 U.S. at 212 ("merely requiring generic computer implementation
fails to transform [the] abstract idea into a patent-eligible invention").
Accordingly, we agree with the Examiner that claim 1 is patent
ineligible, as well as independent claims 12 and 14 not separately argued,
and dependent claims 2---6 and 11 not separately argued. See App. Br. 9.
CONCLUSION
For the reasons stated above, we reverse the Examiner's indefiniteness
rejection of claim 14.
For the reasons stated above, we affirm the Examiner's non-statutory
subject matter rejection of claims 1---6, 11, 12 and 14.
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DECISION
The Examiner's decision rejecting claim 14 under 35 U.S.C. § 112,
second paragraph, is reversed.
The Examiner's decision rejecting claims 1-6, 11, 12, and 14 under
35 U.S.C. § 101 is affirmed.
No time period for taking any subsequent action in connection with
this appeal may be extended under 3 7 C.F .R. § 1.13 6( a )(1 )(iv).
AFFIRMED
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