Ex Parte Phillips

Patent Trials and Appeals Board

Dec 19, 2014

12695418 - (D) (P.T.A.B. Dec. 19, 2014)

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.
12/695,418 01/28/2010 Simon Phillips P00611-US-UTIL
(M01.154)
7876
28062 7590 12/22/2014
BUCKLEY, MASCHOFF & TALWALKAR LLC
50 LOCUST AVENUE
NEW CANAAN, CT 06840
EXAMINER
MAHONE, KRISTIE A
ART UNIT PAPER NUMBER
3627
MAIL DATE DELIVERY MODE
12/22/2014 PAPER
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.
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
____________________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________________

Ex parte SIMON PHILLIPS
____________________

Appeal 2012-004731
Application 12/695,4181
Technology Center 3600
____________________

Before ANTON W. FETTING, JOSEPH A. FISCHETTI, and
MICHAEL C. ASTORINO, Administrative Patent Judges.

FISCHETTI, Administrative Patent Judge.

DECISION ON APPEAL

STATEMENT OF THE CASE
Appellant seeks our review under 35 U.S.C. § 134 from the
Examiner’s final rejection of claims 19–28. We have jurisdiction under
35 U.S.C. § 6(b).
We AFFIRM.

1 The Appellants identify MASTERCARD INTERNATIONAL, INC. as the
real part in interest. (App. Br. 2).
Appeal 2012-004731
Application 12/695,418

2
THE CLAIMED INVENTION
Appellant’s claimed invention is directed to an incentive program for
point-of-sale operators (Spec. 3, ll. 8–10).
Claim 19, reproduced below, is representative of the subject matter on
appeal:
19. A method comprising:
receiving, from a particular point-of-sale (POS) terminal,
a first message from a merchant, the first message indicating
that a particular individual POS operator is operating the
particular POS terminal;
setting a time-out period in response to receiving the first
message;
receiving a second message prior to expiration of the
time-out period, the second message indicating a transaction
performed at the particular POS terminal, the second message
indicating a mode of payment for the transaction;
transmitting an authorization request for the transaction;
receiving a favorable response to the authorization
request; and
crediting the transaction, by a rewards server, to an
incentive account belonging to the particular individual POS
operator in response to a plurality of conditions being satisfied,
the plurality of conditions including: (a) the second message
being received prior to expiration of the time-out period, (b) the
favorable response to the authorization request, and (c) the
mode of payment for the transaction being a favored mode of
payment.

The Examiner relies on the follow references in support of the
rejections.
Ronchi US 2002/0077973 A1 June 20, 2002
Anderson US 2005/0209917 A1 Sept. 22, 2005
Kowalick US 7,107,245 B1 Sept. 12, 2006
Appeal 2012-004731
Application 12/695,418

3
de Boer US 2007/0124204 A1 May 31, 2007
Nobrega US 7,292,996 B2 Nov. 6, 2007
Odom US 7,349,884 B1 Mar. 25, 2008
Nuzum US 2009/0048916 A1 Feb. 19, 2009
Phillips US 2009/0204525 A1 Aug. 13, 2009
Kennedy US 7,683,888 B1 Mar. 23, 2010

THE REJECTIONS
The following rejections are before us for review:
The Examiner rejected claims 19–21, 23, and 25 under 35 U.S.C.
§ 103(a) as unpatentable over Anderson, de Boer, Phillips, and Kennedy.
The Examiner rejected claim 22 under 35 U.S.C. § 103(a) as
unpatentable over Anderson, de Boer, Phillips, Kennedy, and Nobrega.
The Examiner rejected claim 24 under 35 U.S.C. § 103(a) as
unpatentable over Anderson, de Boer, Phillips, Kennedy, and Odom.
The Examiner rejected claim 26 under 35 U.S.C. § 103(a) as
unpatentable over Anderson, de Boer, Phillips, Kennedy, and Nuzum.
The Examiner rejected claim 27 under 35 U.S.C. § 103(a) as
unpatentable over Anderson, de Boer, Phillips, Kennedy, and Kowalick.
The Examiner rejected claim 28 under 35 U.S.C. § 103(a) as
unpatentable over Anderson, de Boer, Phillips, Kennedy, Ronchi, and
Kowalick.

FINDINGS OF FACT
1. de Boer discloses an incentive program for business owners, in that:
Appeal 2012-004731
Application 12/695,418

4
. . . the Merchant Proprietor (MP), who is also a proprietor of
the participating Service Establishment (SE), may accumulate
bonus rewards on any business related or personal spend.
However, unlike traditional rewards programs, the participating
MP further accumulates bonus rewards within her [Rewards
Program Account (RPA)] based on all card member spend at
the MP's business.
(¶ 92).
2. de Boer discloses incentives based on customer credit card usage,
stating, “each time she accepts a customer's American Express® charge
card for payment within her clothing store, she will be awarded
additional bonus rewards calculated from the amount of the consumer
payment.” (¶ 92).
3. Anderson discloses crediting an employee incentive account, stating:
an employee account is credited when a customer makes a
purchase using the program card. As mentioned above, the
employee is credited for both creating a new account, and using
an existing account. By giving an employee credit each time an
account is used, the employee is more likely to encourage use
of the program card, and as a result, the program will be more
successful.
(¶ 35).
4. Anderson discloses a cash register, connected over a network to a server
that stores employee information. (¶ 29).
5. Anderson discloses using the “employee’s ID number” in conjunction
with a customer loyalty card. (¶ 30).
6. Anderson discloses determining the employee ID by “retrieving the
employee ID from a Point of Sale (POS) terminal.” (Col. 4, Claim 11).
7. Kennedy discloses a time out, stating, “the log out may occur after a
predetermined amount of time, e.g., times out.” (Col. 11, ll. 54–55).
Appeal 2012-004731
Application 12/695,418

5
8. The Examiner sets forth a motivation for combining Anderson’s
employee incentive system, with Phillips’ POS transaction flow, “to
ensure receipt of payment before awarding the incentive.” (Ans. 5).
9. The Examiner sets forth a motivation for combining Anderson/Phillips
with Kennedy’s time-out approach, “to prevent undeserving persons
from receiving incentives, particularly when multiple people operate the
POS terminal.” (Ans. 6).
10. The Examiner sets forth a motivation to combine
Anderson/Phillips/Kennedy with de Boer’s incentive system for
payment type, “to motivate POS operators to induce customer loyalty to
a particular payment mode.” (Ans. 6).
11. Phillips concerns “a purchase transaction with such a card, the card is
swiped through a magnetic stripe reader that is part of a point of sale
(POS) terminal.” (¶ 1).
12. Kennedy concerns an input device for a computer system, which system
may encompass “point of sale machines (POS).” (Col. 1, ll. 37–42).
13. Ronchi is concerned with “storing, distributing and issuing pre-paid
cards to be used for long distance calling (‘phone cards’) and for selling
goods and services in e-commerce to pre-paid card holders.” (¶ 29).
14. Ronchi discloses the use of the pre-paid cards requires a PIN that
corresponds to an amount of money. (¶ 30, 32).
15. Ronchi discloses a point-of-sale manager that sells pre-paid cards and
PIN numbers using a point-of-sale device requiring user login. (¶ 51).

Appeal 2012-004731
Application 12/695,418

6
ANALYSIS
Claims 1926
Concerning independent claim 19, the sole independent claim before
us, the Appellant argues that de Boer does not disclose crediting an account
of an individual POS operator, because instead, de Boer discloses incentives
only for a “merchant proprietor” or “store owner.” (App. Br. 10–12; see
also Reply Br. 2–4).
We are not persuaded by the Appellant’s argument, because de Boer
discloses a proprietor “accumulates bonus rewards” that are based on, for
example, “each time she accepts a customer’s American Express® charge
card for payment . . . .” (FF 1, 2). We further find that a proprietor/owner
may be the person operating the point of sale register, as is common in small
retail establishments. Even still further, we find that an employee acts as an
agent of the proprietor when operating a point-of-sale terminal, under the
direction of the owner. The two roles are intertwined. Therefore, we see no
patentable distinction between and owner/proprietor that is rewarded for
particular payment method use, and an employee of that owner performing
the actions on behalf of an owner.
In addition, Anderson discloses crediting the account of a point of sale
employee operator to incentivize particular behavior, because “employee is
more likely to encourage use of the program card.” (FF 3). Therefore, we
find no error with the combination of Anderson with de Boer meeting the
claim language of “crediting the transaction, by a rewards server, to an
incentive account belonging to the particular individual POS operator”
(claim 19).
Appeal 2012-004731
Application 12/695,418

7
The Appellant asserts that in Kennedy the manager’s “log out can
occur after a predetermined amount of time to prevent further refunds,” but
Kennedy’s time out is not “in response to receiving a first message,” where
the first message indicates that a particular individual POS operator is
operating the particular POS terminal. (App. Br. 12–14).
We are not persuaded by the Appellant’s argument. Anderson
discloses a server, connected to POS terminals, that stores employee
information (FF 4) and using the employee’s ID number (FF 5) to credit the
employee account (FF 3). We infer from the use of the employee’s ID
number (FF 5, 6), that the server receives a message that the employee has
logged on to the POS terminal. Anderson does not time the employee’s use
of the POS terminal, so we infer that Anderson merely keeps track of when
the employee is logged in and out of the POS terminal. See KSR Int’l. Co. v.
Teleflex Inc., 550 U.S. 398, 418 (2007). (In making the obviousness
determination one “can take account of the inferences and creative steps that
a person of ordinary skill in the art would employ.”)
We nevertheless find that Kennedy does disclose another method for
determining which employee is on the POS terminal, by using a time-out
period. (FF 7). This would eliminate the need to contact the POS terminal
to receive the employee ID, as in Anderson, because it assumes the
employee who signed in is using the POS terminal for the duration of the
time-out period. Inasmuch as there are a limited number of choices for
determining which employee is using a POS terminal, the choice of a time
out period is constrained to a given number of obvious options for the
ordinary artisan seeking to implement such a system. See KSR Int'l Co. v.
Teleflex, Inc., 550 U.S. 398, 421 (2007) (“[w]hen there is a design need or
Appeal 2012-004731
Application 12/695,418

8
market pressure to solve a problem and there are a finite number of
identified, predictable solutions, a person of ordinary skill has good reason
to pursue the known options within his or her technical grasp. If this leads
to the anticipated success, it is likely the product not of innovation but of
ordinary skill and common sense”).
We are not persuaded by the Appellant’s arguments of impermissible
hindsight, conclusory statements, “absence of a convincing line of
reasoning, and of any motivation in the prior art” for the combination of
references. (App. Br. 15; see also Reply Br. 5).
We find instead that the Examiner articulated rationales for the
combinations (FF 8–10), thus showing the combinations are not based in
impermissible hindsight, and that the conclusion of obviousness is not
“conclusory.” To the extent Appellant seeks an explicit suggestion or
motivation in the reference itself, this is no longer the law in view of the
Supreme Court’s holding in KSR. KSR at 419.
The Appellant next argues Kennedy is not analogous art, because “it
does not even remotely relate to employee incentive programs” (App. Br.
15) and “is not reasonably pertinent to the particular problem with which the
present inventor was concerned . . .” (Reply Br. 5).
We disagree with Appellant because Anderson (FF 4), Phillips (FF
11), and Kennedy (FF 12) are concerned with the use of point of sale
devices, and are thus analogous art, because they are in the same field of
endeavor. See In re Clay, 966 F.2d 656, 658–59 (Fed. Cir. 1992).
For these reasons, we affirm the rejection of independent claim 19, as
well as dependent claims 20, 21, 23, and 25 that were not separately argued.
(App. Br. 16). We also affirm the separate rejections of dependent claims
Appeal 2012-004731
Application 12/695,418

9
22, 24, and 26, which are argued as being patentable for the “same reasons”
as claim 19. (App. Br. 16–18).

Claim 27
Dependent claim 27 recites:
detecting expiration of the time-out period;
receiving a third message indicating a second transaction
performed at the particular POS terminal with a favored mode
of payment; and
not crediting the second transaction to the incentive
account of the particular individual POS operator.
The Appellant argues that Kowalick fails to disclose “not crediting”
after expiration of a time-out period, because Kowalick is instead focused on
crediting wins and losses in a gaming apparatus until a player logs off.
(App. Br. 18–21).
We disagree with Appellant because we find that when a time-out
period is used, the ordinary artisan would recognize that an action that takes
place after the time-out period will be different from one occurring within
the time-out period, because that is essentially a main purpose of the period,
to separate behavior before and after the period. Therefore, because the
combination in claim 19 discloses using a time-out period to credit the
proper employee operating the POS terminal, it can be inferred that after the
period, one would not credit the employee, because it may at that point be a
different employee at the POS terminal. See KSR at 418. (In making the
obviousness determination one “can take account of the inferences and
creative steps that a person of ordinary skill in the art would employ.”) This
is essentially what the Examiner articulates. (Ans. 18). Therefore, Kowalick
is a cumulative reference.
Appeal 2012-004731
Application 12/695,418

10

Claim 28
Dependent claim 28 recites:
detecting expiration of the time-out period;
receiving a login message that indicates that the
particular individual POS terminal operator is operating the
particular POS terminal;
receiving a third message indicating a second transaction
performed at the particular POS terminal with a favored mode
of payment; and
crediting the second transaction to the incentive account
of the particular individual POS operator.
Preliminarily, we discuss the construction of claim 28. The Federal
Circuit has held that “[u]nless the steps of a method actually recite an order,
the steps are not ordinarily construed to require one.” Interactive Gift Exp.,
Inc. v. CompuServe Inc., 256 F.3d 1323, 1342 (Fed. Cir. 2001). Here, we
find nothing in claim 28 that requires any particular order for all the steps
recited. The Examiner however appears to have assumed claim 28 is
performed after the steps in claim 19. (Ans. 10). Even in this narrow
interpretation of claim 28, claim 28 merely repeats many of the steps of
claim 19 with an operator logging in and conducting a transaction that leads
to a credit to the operator’s account. One of ordinary skill would recognize
that retail point of sale operators conduct repeated transactions in each
check-out session, and may log off and back on, such as after a break, before
repeating the process with additional customers. By simply repeating the
login and transactions, one would merely perform more transactions, as
expected. Merely repeating a step has no patentable significance unless it
produces a new or unexpected result. See Perfect Web Techs., Inc. v.
InfoUSA, Inc., 587 F.3d 1324, 133031 (Fed. Cir. 2009) (finding obvious a
Appeal 2012-004731
Application 12/695,418

11
claimed invention that required performance of three steps known in the
prior art, followed by repetition of those steps until a desired result was
obtained).
The Examiner relies on Ronchi as disclosing having an operator
repeat the login process after a time-out period, before performing more
transactions. (Ans. 10). Appellant argues that Ronchi is non-analogous art,
therefore there would be no motivation to combine Ronchi with Kowalick or
with any of Anderson/ de Boer/Phillips/Kennedy, because there is no
teaching or suggestion to do so. (App. Br. 22).
We are not persuaded by the Appellant’s argument, because we find
claim 28 merely repeats steps of claim 19, which is an obvious extension of
the method of claim 19. As such, Ronchi is a cumulative reference. In
addition, Ronchi discloses the sale of pre-paid cards with PINs that
correspond to an amount of money, at a point of sale, using a device that
requires user login. (FF 13–15). As such, Ronchi is concerned with
common problems facing point-of-sale devices, as with the claimed
invention.
Therefore we affirm the rejection of claim 28.

DECISION
The Examiner’s rejections of claims 19–28 under 35 U.S.C. § 103(a)
are affirmed.

No time period for taking any subsequent action in connection with
this appeal may be extended under 37 C.F.R. § 1.136(a)(1)(iv).

Appeal 2012-004731
Application 12/695,418

12
AFFIRMED
llw