Ex Parte Lively

Patent Trial and Appeal Board

Dec 27, 2016

12619667 (P.T.A.B. Dec. 27, 2016)

United States Patent and Trademark Office
UNITED STATES DEPARTMENT OF COMMERCE
United States Patent and Trademark Office
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APPLICATION NO. FILING DATE FIRST NAMED INVENTOR ATTORNEY DOCKET NO. CONFIRMATION NO.
12/619,667 11/16/2009 Steven R. Lively 100968-0001
(NEV-001US)
9050
48329 7590 12/29/2016
FOT FY Rr T ARDNFR T T P
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12/29/2016 ELECTRONIC
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PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte STEVEN R. LIVELY
Appeal 2014-008269
Application 12/619,6671
Technology Center 3600
Before HUBERT C. LORIN, ANTON W. FETTING, and
NINA L. MEDLOCK, Administrative Patent Judges.
LORIN, Administrative Patent Judge.
DECISION ON APPEAL
STATEMENT OF THE CASE
Steven R. Lively (Appellant) seeks our review under 35U.S.C. § 134
of the final rejection of claims 1-21. We have jurisdiction under 35 U.S.C.
§ 6(b) (2002).
SUMMARY OF DECISION
We AFFIRM but denominate the affirmed rejections as NEW
GROUNDS OF REJECTION and enter a NEW GROUND OF
REJECTION.
1 The Appellant identifies Steven R. Lively as the real party in interest.
Br. 2.
Appeal 2014-008269
Application 12/619,667
THE INVENTION
Claim 1, reproduced below, is illustrative of the subject matter on
appeal.
1. A method of monitoring a procurement relationship to initiate a
transformation of the procurement relationship comprising:
performing in a computing system by one or more processors
following machine-interpretable instructions the steps of
receiving, by a metrics calculator, financial data relating to cost
basis of a product of a first vendor facility, the first vendor facility
providing the product to a procurer at a first price;
identifying, by the metrics calculator, a first profit margin of the
product;
receiving, by an expansion calculator, data identifying costs
associated with establishing an expanded production facility to
produce the product;
determining, by the expansion calculator, a margin threshold
based upon the costs associated with establishing the expanded
production facility, the margin threshold identifying a second profit
margin at which total profit for the product from the first vendor
facility and expanded production facility together exceeds profit from
the first vendor facility when the product is provided at a selected
second price which is lower than the first price; and
indicating, by an expanded production indicator, that the first
profit margin is greater than the margin threshold.
THE REJECTIONS
The Examiner relies upon the following as evidence of
unpatentability:
Kataoka US 2004/0186765 A1 Sept. 23,2004
Seaman US 2008/0120198 A1 May 22,2008
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Kiger, Jack E. et al, “Accounting Principles,” Random House, Inc.,
1984. [NPL-Accounting]
“Implications of Increased Ethanol Production for US Agriculture,”
Food and Agricultural Policy Research Institute, University of
Missouri-Columbia, FAPRI-UMC Report #10-05, Aug. 22, 2005.
[NPL-Ethanol].
The following rejections are before us for review:
1. Claims 1—7, 9—18, 20 and 21 are rejected under 35 U.S.C. § 103(a) as
being unpatentable over Kataoka, NPL-Accounting, and NPL-
Ethanol.
2. Claims 8 and 19 are rejected under 35 U.S.C. § 103(a) as being
unpatentable over Kataoka, NPL-Accounting, NPL-Ethanol, and
Seaman.
ISSUES
Did the Examiner err in rejecting claims 1—7, 9—18, 20 and 21 under
35 U.S.C. § 103(a) as being unpatentable over Kataoka, NPL-Accounting,
and NPL-Ethanol?
Did the Examiner err in rejecting claims 8 and 19 under 35 U.S.C.
§103 (a) as being unpatentable over Kataoka, NPL-Accounting, NPL-
Ethanol, and Seaman?
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Application 12/619,667
ANALYSIS
The rejection of claims 1—7, 9—18, 20 and 21 under 35 U.S.C. §103(a) as
being unpatentable over Kataoka, NPL-Accounting, and NPL-Ethanol.
The Appellant argued claims 1—7, 9—18, 20, and 21 as a group (Br. 7—
16). We select claim 1 as the representative claim for this group, and the
remaining claims 2—7, 9—18, 20, and 21 stand or fall with claim 1. 37 C.F.R.
§ 41.37(c)(l)(vii) (2007).
Claim 1 is directed to a “method of monitoring a procurement
relationship to initiate a transformation of the procurement relationship.” It
is not, as the Appellant appears to be arguing, directed to “establishing a
facility.” See e.g., Br. 12—13.
Said method involves performing certain instructions “in a computing
system by one or more processors.” The claim characterizes the instructions
as steps and they comprise:
1. “receiving, by a metrics calculator,” information A;
2. “identifying, by the metrics calculator,” information B;
3. “receiving, by an expansion calculator,” information C;
4. “determining, by the expansion calculator,” information D; and,
5. “indicating, by an expanded production indicator,” information E;
where,
• A = “financial data relating to cost basis of a product of a first
vendor facility, the first vendor facility providing the product to a
procurer at a first price.”
• B = “a first profit margin of the product.”
• C = “data identifying costs associated with establishing an
expanded production facility to produce the product.”
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• D = “a margin threshold based upon the costs associated with
establishing the expanded production facility, the margin threshold
identifying a second profit margin at which total profit for the
product from the first vendor facility and expanded production
facility together exceeds profit from the first vendor facility when
the product is provided at a selected second price which is lower
than the first price.”
• E = “that the first profit margin is greater than the margin
threshold.”
We have reviewed the Specification to ascertain the meaning of the
claim phrases “metrics calculator,” “expansion calculator,” and “expanded
production indicator.” Based on that review, we find that they mean to
cover common functions of conventional computer elements. The “metrics
calculator” is disclosed as provided by “e.g., a computer or database . . . can
comprise hardware, software, machine interpretable instructions executing
on a processor, or any combination thereof.” Spec. para. 153. Similarly, the
“expansion calculator” “can comprise hardware, software, machine
interpretable instructions executing on a processor, or any combination
thereof.” Spec. para. 158. The same for the “expanded production
indicator.” See Spec. Para. 161.
Accordingly, claim 1 describes a method of performing an ordered
combination of common computer functions (“receiving,” “identifying,”
“receiving,” “determining,” “indicating”) to process different types of
information (A—E as above).
The Appellant’s arguments go to the types of information (A—E as
above) being processed as claimed; that is, the Appellant argues that the
cited prior art combination does not disclose and would not lead one to
process the types of information as claimed:
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Assume, arguendo and without acquiescence, the following:
Kataoka disclosed “receiving ... costs associated with establishing a
facility”; NPL-Accounting disclosed that fixed costs always rise when
an additional facility is opened; and NPL-Ethanol disclosed that
increased supply always leads to lower prices. Applicant respectfully
submits that, even under these assumptions, the combination of these
concepts still fails to teach or suggest at least the following features of
claim 1 in context.
receiving, by an expansion calculator, data identifying
costs associated with establishing an expanded production
facility to produce the product;
determining, by the expansion calculator, a margin
threshold based upon the costs associated with establishing the
expanded production facility, the margin threshold identifying a
second profit margin at which total profit for the product from
the first vendor facility and expanded production facility
together exceeds profit from the first vendor facility when the
product is provided at a selected second price which is lower
than the first price; and
indicating, by an expanded production indicator, that the first
profit margin is greater than the margin threshold.
Br. 15.
Said arguments going to the types of information (A—E as above)
being processed as claimed are not persuasive as to error in the rejection
because, said limitations (A—E as above) are a matter of the content of
information distinguishing over the prior art information over what it
communicates. As such, said limitations (A—E as above) are properly
characterized as printed matter. Given that printed matter is not given
patentable weight, the argued-over distinction between the type of
information claimed and that of the cited prior art is not patentably
consequential. Cf. In re DiStefano, No. 2015-1453 (Fed. Cir. 2015). See
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also In re Xiao, 462 Fed. Appx. 947, 950-52 (Fed. Cir. 2011) (non-
precedential):
[T]he Board did not create a new “mental distinctions” rule in
denying patentable weight. ... On the contrary, the Board
simply expressed the above-described functional relationship
standard in an alternative formulation—consistent with our
precedents—when it concluded that any given position label’s
function ... is a distinction “discemable only to the human
mind.” [See] In re Lowry, 32 F.3d 1579, 1583 (Fed. Cir. 1994)
(describing printed matter as “useful and intelligible only to the
human mind”) (quoting In re Bernhart, 417 F.2d 1395, 1399
(CCPA 1969)).
Xiao, 462 Fed. Appx. at 951-952. “Thus non-functional descriptive
material, being useful and intelligible only to the human mind, is given no
patentable weight.” Ex parte Graf, Appeal 2012-003941, slip op. at 7
(PTAB July 23, 2013) (non-precedential), aff’d, In re Graf, 585 Fed. Appx.
1012 (Fed. Cir. 2014) (Fed. Cir. 2014) (non-precedential). “The rationale
behind this line of cases is preventing the indefinite patenting of known
products by the simple inclusion of novel, yet functionally unrelated
limitations.” King Pharms., Inc. v. Eon Labs, Inc., 616 F.3d 1267, 1279
(Fed. Cir. 2010) (citation omitted).
The remaining arguments are unpersuasive as to error in the rejection.
Our claim construction analysis and subsequent determination that the
claim limitations at issue are patentably inconsequential nonfunctional
descriptive material of the data being processed via the ordered combination
of common computer functions (“receiving,” “identifying,” “receiving,”
“determining,” “indicating”) as claimed is a departure from the Examiner’s
reasoning — which argued that said information as claimed is in fact
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disclosed (see Final Act. 4-8). Accordingly, albeit we affirm the rejection,
we denominate it as a new ground of rejection.
The rejection of claims 8 and 19 under 35 U.S.C. §103 (a) as being
unpatentable over Kataoka, NPL-Accounting, NPL-Ethanol, and Seaman.
The Appellant does not specifically address this rejection of
dependent claims 8 and 19. Accordingly, we affirm the rejection but, as
with the above rejection of the independent claims, we denominate it as a
new ground of rejection.
NEW GROUND OF REJECTION
Claims 1—21 are rejected under 35 U.S.C. § 101 as being directed to
judicially-excepted subject matter.
Alice Corp. Pty. Ltd. v. CLS Bank International, 134 S. Ct. 2347
(2014) identifies a two-step framework for determining whether claimed
subject matter is judicially-excepted from patent eligibility under § 101.
According to Alice step one, “[w]e must first determine whether the
claims at issue are directed to a patent-ineligible concept,” such as an
abstract idea. Alice, 134 S. Ct. at 2355.
Taking claim 1 as representative of the claims on appeal, the claimed
subject matter is directed to information processing. Information processing
is a fundamental building block of human ingenuity. As such it is an
abstract idea.
Step two is “a 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
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concept] itself.’” Id. (alteration in original) (quoting Mayo Collaborative
Servs. v. Prometheus Labs., Inc., 132 S. Ct. 1289, 1294 (2012)).
We see nothing in the subject matter claimed that transforms the
abstract idea of information gathering into an inventive concept.
As already explained above, the method of claim 1 sets out five steps
for “receiving,” “identifying,” “receiving,” “determining,” “indicating”
different types of information (A—E as above). None of these individual
steps, viewed “both individually and ‘as an ordered combination,’ ”
transforms the nature of the claim into patent-eligible subject matter. See
Alice, 134 S.Ct. at 2355 (quotingMayo, 132 S.Ct. at 1297, 1298). They are
known operations for obtaining and generating desired information and thus
add little to patentably transform the information processing abstract idea.
Furthermore, each of the “receiving,” “identifying,” “receiving,”
“determining,” “indicating” steps is itself directed to an abstract idea.
Merely combining five abstract ideas does not render the combination any
less abstract. Cf. Shortridge v. Found. Constr. Payroll Serv., LLC, No. 14-
CV-04850-JCS, 2015 WL 1739256 (N.D. Cal. Apr. 14, 2015), affd, No.
2015-1898, 2016 WL 3742816 (Fed. Cir. July 13, 2016).
The five steps are notable for the specific type of information being
processed. But said types of information give the information-processing
concept a contextual application. But that is insufficient to transform the
information-processing concept into an inventive one. Cf. CyberSource
Corp. v. Retail Decisions, Inc., 654 F.3d 1366, 1371 (Fed. Cir. 2011) (“The
Court [Parker v. Flook, 437 U.S. 584 (1978)] rejected the notion that the
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recitation of a practical application for the calculation could alone make the
invention patentable.”).
Finally, we note that claim 1 calls for the recited method to involve a
computer system, one or more processors, and a “metrics calculator,” an
“expansion calculator,” and an “expanded production indicator.” As we
explained above, the Specification supports the view that any general-
purpose computer available at the time the application was filed would have
satisfied these limitations. “[T]he mere recitation of a generic computer
cannot transform a patent-ineligible abstract idea into a patent-eligible
invention. Stating an abstract idea “while adding the words ‘apply if” is not
enough for patent eligibility.” Alice, 134 S. Ct. at 2358.
For the foregoing reasons, we find that claim 1 covers claimed subject
matter that is judicially-excepted from patent eligibility under § 101. The
other independent claim — system claim 12 parallels claim 1 — similarly
covers claimed subject matter that is judicially-excepted from patent
eligibility under § 101. The dependent claims further limit the types of
information to be processed which does little to patentably transform the
abstract idea.
Therefore, we enter a new ground of rejection of claims 1—21 under
35U.S.C. § 101.
For the foregoing reasons, the rejections are affirmed but denominated
as new grounds of rejection but claims 1—21 are also newly rejected under §
101.
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CONCLUSIONS
The rejection of claims 1—7, 9—18, 20 and 21 under 35 U.S.C. §103 (a)
as being unpatentable over Kataoka, NPL-Accounting, and NPL-Ethanol is
affirmed but denominated as a new ground of rejection.
The rejection of claims 8 and 19 under 35 U.S.C. § 103(a) as being
unpatentable over Kataoka, NPL-Accounting, NPL-Ethanol, and Seaman is
affirmed but denominated as a new ground of rejection.
Claims 1—21 are newly rejected under 35 U.S.C. § 101 as being
directed to judicially-excepted subject matter.
DECISION
The decision of the Examiner to reject claims 1—21 is affirmed.
Claims 1—21 are newly rejected.
NEW GROUND
This decision contains a new ground of rejection pursuant to
37 C.F.R. § 41.50(b). 37 C.F.R. § 41.50(b) provides “[a] new ground of
rejection pursuant to this paragraph shall not be considered final for judicial
review.” 37 C.F.R. § 41.50(b) also provides that the Appellants, WITHIN
TWO MONTHS FROM THE DATE OF THE DECISION, must exercise
one of the following two options with respect to the new ground of rejection
to avoid termination of the appeal as to the rejected claims:
(1) Reopen prosecution. Submit an appropriate amendment
of the claims so rejected or new evidence relating to the claims
so rejected, or both, and have the matter reconsidered by the
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examiner, in which event the proceeding will be remanded to the
examiner. . . .
(2) Request rehearing. Request that the proceeding be
reheard under § 41.52 by the Board upon the same record. . . .
AFFIRMED; 37 C.F.R, $ 41.50(b)
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