Ex Parte Kemp et al

Patent Trial and Appeal Board

Jul 17, 2017

13345448 (P.T.A.B. Jul. 17, 2017)

United States Patent and Trademark Office
UNITED STATES DEPARTMENT OF COMMERCE
United States Patent and Trademark Office
Address: COMMISSIONER FOR PATENTS
P.O.Box 1450
Alexandria, Virginia 22313-1450
www.uspto.gov
APPLICATION NO. FILING DATE FIRST NAMED INVENTOR ATTORNEY DOCKET NO. CONFIRMATION NO.
13/345,448 01/06/2012 Donald W. Kemp 21652-00187 9252
75564 7590 07/19/2017
DANIEL M. FITZGERALD (21652)
ARMSTRONG TEASDALE LLP
7700 Forsyth Boulevard
Suite 1800
St. Louis, MO 63105
EXAMINER
MISIASZEK, MICHAEL
ART UNIT PAPER NUMBER
3625
NOTIFICATION DATE DELIVERY MODE
07/19/2017 ELECTRONIC
Please find below and/or attached an Office communication concerning this application or proceeding.
The time period for reply, if any, is set in the attached communication.
Notice of the Office communication was sent electronically on above-indicated "Notification Date" to the
following e-mail address(es):
USpatents @ armstrongteasdale. com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte DONALD W. KEMP, CHRISTOPHER P. AGUAS,
BRIAN O’NEALE BETTINGER, THOMAS G. ROMARY,
and HUGH HERRICK BIRCH
Appeal 2016-004736
Application 13/345,448
Technology Center 3600
Before ST. JOHN COURTENAY III, KRISTEN DROESCH, and
JOHN D. HAMANN, Administrative Patent Judges.
COURTENAY, Administrative Patent Judge.
DECISION ON APPEAL
STATEMENT OF THE CASE
This is an appeal under 35 U.S.C. § 134(a) from the Examiner’s Final
Rejection of claims 1—25. We have jurisdiction under 35 U.S.C. § 6(b).
We affirm.
Appeal 2016-004736
Application 13/345,448
The Invention
The disclosed and claimed invention on appeal relates:
generally to systems and methods for tracking price changes for
a purchase made using a transaction card and, more particularly,
to systems and methods for tracking a subsequent reduction in
price of a purchase made by a cardholder using a transaction
card, and compensating the cardholder by providing, or
arranging for the provision of, an item of value to the cardholder
valued at least a portion of the price reduction.
(Spec. 12).
Independent Claim 1
1. A computer-based method for tracking a price change of a
purchase made using a transaction card over an interchange
network, the interchange network including an interchange
computing device and a price tracking computer device in
communication with a memory device, said method comprising:
receiving, at the interchange computing device included
within the interchange network, transaction data associated with
a purchase of an item by a cardholder using the transaction card,
wherein the interchange computing device receives and
authorizes a plurality of cardholder transactions including the
purchase of the item, wherein the interchange computing device
settles funds between a plurality of financial institutions for the
plurality of cardholder transactions;
transmitting, from the interchange computing device via
the interchange network, an authorization message in response to
the purchase of the item;
directing at least some of the transaction data from the
interchange computing device to the price tracking computer
device including a purchase price of the item; and
using the price tracking computer device to track changes
in a current asking price of the item, and compare the purchase
price of the item to the current asking price of the item.
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Rejection
Claims 1—25 are rejected under 35 U.S.C. § 101 as being directed to
non-statutory subject matter (i.e., a judicial exception). Final Act. 2.
ANALYSIS
We have considered all of Appellants’ arguments and any evidence
presented. Regarding the rejection of claims 1—25 under 35 U.S.C. § 101,
we disagree with Appellants’ arguments and we adopt as our own: (1) the
findings and legal conclusions set forth by the Examiner in the Final Office
Action (2-4), from which this appeal is taken, and (2) the corresponding
findings, legal conclusions, and explanations, as set forth in the Answer (2—
9), in response to Appellants’ arguments. (App. Br. 4—10). We highlight
and address specific findings and arguments for emphasis in our analysis
below.
Rejection under § 101 of Claims 1—25
Issue: Under § 101, did the Examiner err in concluding that claims
1—25 are directed to non-statutory subject matter?1
Under 35 U.S.C. § 101, an invention is patent-eligible if it claims a
“new and useful process, machine, manufacture, or composition of matter.”
The Supreme Court, however, has long interpreted § 101 to include an
implicit exception: “[ljaws of nature, natural phenomena, and abstract ideas
are not patentable.” See, e.g., Alice Corp. Pty. Ltd. v. CLSBanklnt’l, 134 S.
Ct. 2347, 2354 (2014) (quoting Assoc, for Molecular Pathology v. Myriad
Genetics, Inc., 133 S. Ct. 2107, 2116 (2013) (internal quotation marks
1 We give the contested claim limitations the broadest reasonable
interpretation consistent with the Specification. See In re Morris, 111 F.3d
1048, 1054 (Fed. Cir. 1997).
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omitted)). In Alice, the Supreme Court set forth an analytical “framework
for distinguishing patents that claim laws of nature, natural phenomena, and
abstract ideas from those that claim patent-eligible applications of those
concepts.” Id. at 2355 (citing Mayo Collaborative Servs. v. Prometheus
Labs., Inc., 132 S. Ct. 1289, 1296-97 (2012)).
The first step in our analysis is to determine whether the claims at
issue are directed to a patent-ineligible concept, such as an abstract idea.
See Alice, 134 S. Ct. at 2355.
If the claims are directed to a patent-ineligible concept, the second
step in the analysis is to “consider the elements of each claim both
individually and ‘as an ordered combination’ to determine whether [there
are] additional elements [that] ‘transform the nature of the claim’ into a
patent-eligible application.” Id. (quoting Mayo, 132 S. Ct. at 1297).
In other words, 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.’” Id. (brackets in original) (quoting
Mayo, 132 S. Ct. at 1294).
Alice — Step One
Regarding the judicially created “abstract idea” exception {Alice, Step
One), Appellants contend, inter alia:
The Examiner’s assertion that the claims are directed
towards an “abstract idea” is completely lacking in any type of
evidence, or any “reasoned rationale that identifies the judicial
exception recited in the claim and why it is considered an
exception.” See 2015 Guidance at p. 6. Remarkably, the
Examiner has failed to provide any rationale (much less a
reasoned one) that identifies why the alleged abstract idea is
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“considered an exception.” Id. The Final Office Action provides
no analysis regarding the identification of the abstract idea.
Instead, page the Final Office Action merely states, “The
Examiner notes that the above rejection uses the same standards
and rationale as the rejection presented in the previous Office
Action” and thereby attempts to incorporate the Office Action of
August 15, 2014 ("2014 Office Action") into its analysis. Yet,
even the 2014 Office Action does not cure the deficiency of the
Examiner's analysis. The only analysis provided in the 2014
Office Action is found at page 4, which states, “Additionally,
these claims are directed to tracking price changes, which is
considered to be to be an abstract idea.” The Examiner provides
no "reasoned rationale" for his conclusion.
Such conclusory analysis falls far below the requirements
set forth for subject matter eligibility analysis. The 2015
Guidance states, “the initial burden is on the examiner to explain
why a claim or claims are unpatentable clearly and specifically,
so that applicant has sufficient notice and is able to effectively
respond.” 2015 Guidance at p. 6. The Examiner has certainly not
clearly and specifically explained the basis for his rationale.
Further, at no point in prosecution has the Examiner identified
any evidence that supports his assertions.
(App. Br. 5—6) (emphases added).
However, we conclude Appellants’ claims 1—25 are analogous to the
“offer-based pricing optimization” claims considered by the court in OIP
Technologies, Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1362 (Fed. Cir.
2015). In OIP Tech., claim 1 was directed to a “method of pricing a product
for sale,” and the OIP specification described the invention as an “automatic
pricing method and apparatus for use in electronic commerce.” (Id. ).
Appellants’ claim 1 is similarly directed to “[a] computer-based
method for tracking a price change of a purchase made using a transaction
card.” Appellants’ remaining independent claims 9, 17, and 23 each recite
similar or commensurate language.
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In applying the reasoning of the court in OIP Tech, to the similar
claims before us on appeal, we consider Appellants’ claimed “method for
tracking a price change of a purchase made using a transaction card” to be
similar to other “fundamental economic concepts” found to be
abstract ideas by the Supreme Court and this court. See, e.g.,
Alice, 134 S. Ct. at 2357 (intermediated settlement); Bilski v.
Kappos, 561 U.S. 593, 611, 130 S. Ct. 3218, 177 L.Ed.2d 792
(2010) (risk hedging); Ultramercial, Inc. v. Hulu, LLC, 772 F.3d
709, 715 (Fed. Cir. 2014) (using advertising as an exchange or
currency); Content Extraction & Transmission LLC v. Wells
Fargo Bank, Nat'l Ass'n, 776 F.3d 1343, 1347 (Fed. Cir. 2014)
(data collection); Accenture Global Servs., GmbH v. Guidewire
Software, Inc., 728 F.3d 1336, 1346 (Fed. Cir. 2013) (generating
tasks in an insurance organization). And that the claims do not
preempt all price optimization or may be limited to price
optimization in the e-commerce setting do not make them any
less abstract. See buySAFE, Inc. v. Google, Inc., 765 F.3d
1350, 1355 (Fed. Cir. 2014) (collecting cases); Accenture,
728 F.3d at 1345.
OIP Tech., 788 F.3d at 1362-63.
In light of the aforementioned guidance of our reviewing courts, and
regarding the first Alice step in our analysis, we have reviewed all of
Appellants’ arguments and find them unpersuasive. (App. Br. 4—10; Reply
Br. 1 4). We conclude each of the claims before us on appeal merely tracks
a price change of a purchase made using a transaction card, using a generic
computer.
Regarding the claimed steps or functions performed by a computer,
we note the Supreme Court in Alice cautions that merely limiting the use of
an abstract idea “to a particular technological environment” or implementing
the abstract idea on a “wholly generic computer” is not sufficient as an
additional feature to provide “practical assurance that the process is more
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than a drafting effort designed to monopolize the [abstract idea] itself.”
Alice, 134 S. Ct. at 2358 (internal quotation marks and citations omitted).
Applying this guidance here, we conclude each of Appellants’ claims
on appeal is distinguishable from the type of claim considered by the Federal
Circuit in Enfish, LLC v. Microsoft Corp., 822 F.3d 1327 (Fed. Cir. 2016).
Here, we conclude none of Appellants’ claims is “directed to an
improvement in the functioning of a computer,” as was found by the court
regarding the subject claim in Enfish, 822 F.3d at 1338 (emphasis added).
Nevertheless, Appellants urge:
Claim 1 addresses a problem for which the claimed solution is,
"necessarily rooted in computer technology in order to overcome
a problem specifically arising in the realm of computer
networks" and, more specifically, in the realm of interchange
payment networks. Indeed, independent Claim 1 recites in part,
a "computer-based method for tracking a price change of a
purchase made using a transaction card over an interchange
network." Claim 1 utilizes and leverages the interchange
network (i.e., a computer network) to receive specific
transaction data required to implement the claimed invention.
Therefore, like the claims of DDR Holdings, Claim 1 recites a
"solution ... necessarily rooted in computer technology in
order to overcome a problem specifically arising in the realm of
computer networks."
(App. Br. 7) (emphasis added).
However, we conclude none of Appellants’ claims is like the claim
held patent-eligible by the court in DDR, in which the claimed invention was
directed to the “challenge of retaining control over the attention of the
customer in the context of the Internet,” such that:
Instead of the computer network operating in its normal,
expected manner by sending the website visitor to the third-party
website that appears to be connected with the clicked
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advertisement, the claimed system generates and directs the
visitor to the above-described hybrid web page that presents
product information from the third-party and visual “look and
feel” elements from the host website.
DDR Holdings, LLCv. Hotels.com, L.P., 773 F.3d 1245, 1258-59 (Fed. Cir.
2014).
Because we conclude all claims on appeal merely use a generic
computer as a tool which is used in the way a computer normally functions,
we conclude Appellants’ claims 1—25 fail to impart any discernible
improvement upon the computer (or computer network), nor have
Appellants shown that the claims on appeal solve “a challenge particular to
the Internet” as considered by the court in DDR, 773 F.3d at 1256—57.
Moreover, to the extent that Appellants’ recited steps or acts (or
functions) may be performed faster or more efficiently using a computer,
our reviewing court provides applicable guidance:
While the claimed system and method certainly purport to
accelerate the process of analyzing audit log data, the speed
increase comes from the capabilities of a general-purpose
computer, rather than the patented method itself. See
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.”).
FairWarning IP, LLC v. Iatric Sys., Inc., 839 F.3d 1089, 1095 (Fed. Cir.
2016) (emphases added).
Applying this reasoning to all of Appellants’ claims on appeal, we
similarly find any purported faster or more efficient performance of the
claimed steps or acts (or functions) merely comes from the capabilities of
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a general-purpose computer, rather than from Appellants’ claimed steps or
functions.
Moreover, we find the claims considered by the Court in Electric
Power Grp., LLC v. Alstom S.A., 830 F.3d 1350 (Fed. Cir. 2016) are also
analogous to Appellants’ claims, to the extent that Appellants’ claims
similarly collect information, analyze it in some fashion, and present or
communicate the result. The Court in Electric Power guides: “we have
treated analyzing information by steps people go through in their minds, or
by mathematical algorithms, without more, as essentially mental processes
within the abstract-idea category.” 830 F.3d at 1354 (internal citations
omitted).
On this record, we find the aforementioned guidance from our
reviewing courts supports the Examiner’s legal conclusion:
since no specific technical activities required to perform the
tracking and comparison are set forth in the claim, the steps can
be considered human mental (i.e., performed entirely in the
human mind) or manual (i.e., performed by a human operator
using pen and paper) activities.
Thus, the claim can be reasonably construed to amount to
some combination of fundamental economic practices, managing
transactions or sales activities, creating a contractual
relationship, and human mental/manual activities. Each of these
types of ideas has been deemed abstract by the courts ....
(Ans. 4—5) (emphasis added).
Accordingly, we conclude all claims 1—25 on appeal are directed to
an abstract idea. (Alice — Step One).
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Alice — Step Two
Proceeding to step two of the Alice test articulated by the Supreme
Court, we further “consider the elements of each 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,
134 S. Ct. at 2355 (quoting Mayo, 132 S. Ct. at 1298, 1297).
Regarding step two of the Alice analysis, Appellants contend, inter
alia\
Even assuming arguendo, that the claims are directed
towards the alleged “abstract idea”, the claims still contain
"significantly more" than the alleged abstract idea of “tracking a
price change.” Under the DDR Holdings analysis, the claims of
the present application are subject matter eligible. In DDR
Holdings, Claim 19 of the ’399 patent was found eligible
because, although it is directed to an abstract idea, it “amounted
to an inventive concept and thus was patent eligible.” The court
found the claim addresses significantly more than an abstract
idea, i.e, the problem of website users being diverted from a host
website to an advertiser website and that, “the claimed solution
is necessarily rooted in computer technology in order to
overcome a problem specifically arising in the realm of computer
networks.”
Claim 1 addresses a problem for which the claimed
solution is, “necessarily rooted in computer technology in order
to overcome a problem specifically arising in the realm of
computer networks” and, more specifically, in the realm of
interchange payment networks. Indeed, independent Claim 1
recites in part, a “computer-based method for tracking a price
change of a purchase made using a transaction card over an
interchange network.” Claim 1 utilizes and leverages the
interchange network (i.e., a computer network) to receive
specific transaction data required to implement the claimed
invention. Therefore, like the claims of DDR Holdings, Claim 1
recites a “solution ... necessarily rooted in computer technology
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in order to overcome a problem specifically arising in the realm
of computer networks.”
(App. Br. 7) (emphases added).
However, for the reasons discussed above, we conclude none of
Appellants’ claims is like the claim held patent-eligible by the court in DDR,
in which the claimed invention was directed to the “challenge of retaining
control over the attention of the customer in the context of the Internet.”
DDR Holdings, 773 F.3d at 1258.
Regarding step two of the Alice test, we find nothing in Appellants’
claims 1—25 that adds anything “significantly more” to transform the
abstract concepts into a patent-eligible application. For example, see claim 1
that is essentially directed to the following steps or acts: receiving
transaction (purchase) data, transmitting an authorization message in
response to the purchase, directing at least some of the transaction data to
the price tracking computer device, and comparing the purchase price of the
item to the current asking price of the item. See Alice, 134 S. Ct. at 2357.
Therefore, we conclude the nature of claims 1—25 is not transformed into a
patent-eligible application of the abstract idea presented, because these
claims do nothing more than simply instruct the practitioner to implement an
abstract idea using a generic computer.
Appellants do not argue that each of the steps or functions recited in
claims 1—25 is individually inventive. None of Appellants’ arguments
persuasively show that some inventive concept arises from the ordered
combination of these steps or functions, which, even if true, would be
unpersuasive given that we conclude Appellants’ claims are directed to
ordinary steps (or functions) in data analysis, and are recited in the ordinary
order, i.e., following a general pattern of collecting, analyzing, and
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communicating the results of the analyzed information. See Elec. Power,
830 F.3d at 1355.
The “machine-or-transformation ” (MoT) test
As recognized by the Federal Circuit in Ultramercial, Inc. v. Hulu,
LLC, 772 F.3d 709, 715—16 (Fed. Cir. 2014), the “machine-or-
transformation” (MoT) test, as outlined in In re Bilski, 545 F.3d 943, 954
(Fed. Cir. 2008), can provide a “useful clue” in the second step of the Alice
framework. Under Bilski’s MoT test, a claimed process is patent-eligible
under § 101 if:
(1) it is tied to a particular machine or apparatus; or
(2) the process transforms a particular article into a different state or
thing. Bilski, 545 F.3d at 954 (citing Gottschalkv. Benson, 409 U.S. 63, 70
(1972)).
Here, we conclude none of Appellants’ claims 1—25 is tied to a
particular machine or apparatus, nor involved in any type of
transformation of any particular article.2
In contrast to DDR Holdings and Enflsh, in which the Federal Circuit
held that claims directed to specific improvements in Internet or computer
capabilities are patent-eligible subject matter, Appellants’ claims are not
2 See Accenture Global Servs., GmbHv. Guidewire Software, Inc., 728 F.3d
1336, 1344-45 (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); Dealertrack,
Inc. v. Huber, 674 F.3d 1315, 1333—34 (Fed. Cir. 2012) (“[s]imply adding a
‘computer aided’ limitation to a claim covering an abstract concept, without
more, is insufficient to render [a] claim patent eligible” (internal citation
omitted)).
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directed to improving any type of Internet or computer capabilities, such as
with Enfish’s “self-referential table for a computer database.” Enfish, 822
F.3d at 1336. We find “transaction data associated with a purchase of an
item by a cardholder using the transaction card” (claim 1), by itself, does not
transform an otherwise-abstract process or system of information collection
and analysis. See id. Like the claims considered by the court in Electric
Power, we conclude Appellants’ claims 1—25 “do not invoke any assertedly
inventive programing” or require an “arguably inventive set of components
or methods.” 830 F.3d at 1355.
We find Appellants’ claimed invocations of conventional, off-the-
shelf computer components are insufficient to pass as an inventive set of
components. As such, our review of the claims, fully considering each
claim’s elements (both individually and as an ordered combination), fails to
show that the nature of any of Appellants’ claims 1—25 is transformed into
patent-eligible subject matter.
In the Final Rejection (4) the Examiner further concludes:
[t]he claims do not set forth the specific technical processes
required to execute the ‘using the price tracking computer device
to t[r]ack changes . . .’ step. Thus, any manner of price tracking
performed by the price tracking computer device (and
subsequent comparison) would be effectively ‘tied up’ by the
present claims.
In the Reply Brief (2—3), Appellants respond: “the Board must reject
the Examiner’s assertion that the claimed recitations are somehow
fundamental truths that, as cited by the Examiner, preempt all possible ways
of, for example, processing transaction requests, directing transaction data,
and tracking changes in price.”
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Although the extent of preemption is a consideration, the absence of
complete preemption is not dispositive. See, e.g.,Ariosa Diagnostics, Inc. v.
Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir. 2015) (“While preemption
may signal patent ineligible subject matter, the absence of complete
preemption does not demonstrate patent eligibility.”). The Federal Circuit
further guides:
[T]he Supreme Court has stated that, even if a claim does not
wholly pre-empt an abstract idea, it still will not be limited
meaningfully if it contains only insignificant or token pre- or
post-solution activity—such as identifying a relevant audience, a
category of use, field of use, or technological environment.
Ultramercial Inc. v. HuluLLC, 722 F.3d 1335, 1346 (Fed. Cir. 2013)
(citations omitted), vacated and remanded, WildTangent, Inv. v.
UltramercialLLC, 134 S. Ct. 2870 (2014) (remanding for consideration in
light of Alice, 134 S. Ct. 2347).
Applying this reasoning here, we conclude each of Appellants’ claims
1—25 is directed to a patent-ineligible abstract concept, and does not recite
something “significantly more” under the second step of the Alice analysis.
Accordingly, for the reasons discussed above, we sustain the Examiner’s
rejection under 35U.S.C. § 101 of claims 1—25, as being directed to non-
statutory subject matter in light of Alice and its progeny.
Reply Brief
To the extent Appellants advance new arguments in the Reply Brief
not in response to a shift in the Examiner’s position in the Answer, we note
arguments raised in a Reply Brief that were not raised in the Appeal Brief or
are not responsive to arguments raised in the Examiner’s Answer will not be
considered except for good cause. See 37 C.F.R. § 41.41(b)(2).
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DECISION
We affirm the Examiner’s decision rejecting claims 1—25 under
35 U.S.C. § 101.
No time period for taking any subsequent action in connection with
this appeal may be extended under 37 C.F.R. § 1.136(a). See 37 C.F.R.
§ 41.50(f).
AFFIRMED
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