Ex Parte Quigg

Board of Patent Appeals and Interferences

Nov 22, 2011

09849504 (B.P.A.I. Nov. 22, 2011)

UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE BOARD OF PATENT APPEALS
AND INTERFERENCES
____________

Ex parte WILLIAM DONOVAN QUIGG
____________

Appeal 2010-005637
Application 09/849,504
Technology Center 3600
____________

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

FISCHETTI, Administrative Patent Judge.

DECISION ON APPEAL

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STATEMENT OF THE CASE
Appellant seeks our review under 35 U.S.C. § 134 of the Examiner’s
final rejection of claims 1-47, 49-67. Claim 48 is cancelled. An oral hearing
was held on July 14, 2011. We have jurisdiction under 35 U.S.C. § 6(b)
(2002).
SUMMARY OF DECISION
We AFFIRM.

THE INVENTION
Appellant claims a system and method for coordinating production
and distribution of paper products. (Specification 1: 6-7).
Claim 1, reproduced below, is representative of the subject matter on
appeal.
1. A computer system for processing a paper product,
comprising:
a processor and a memory including instructions together
providing,
a product order tracker configured to receive a paper product
order from a paper purchaser to purchase a paper product that is
produced by a paper manufacturer, the paper product including
a roll of paper or a plurality of unbound, stacked paper sheets;
a promotions order tracker configured to receive a promotional
material order from a third-party advertiser to place
promotional material on an enclosure for the paper product,
wherein the promotional material is specifically targeted to a
group of people associated with the paper purchaser, the group
comprising those people likely to purchase the goods or
services of the third-party advertiser, and wherein the group of
people are likely to view the promotional material on the
enclosure for an extended period of time; and
a paper product tracker configured to provide instructions for
creating the enclosure for the paper product, the enclosure
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having the promotional material of the received promotional
material order, the paper product tracker further being
configured to provide instructions to enclose the paper product
of the received order with the created enclosure, wherein the
paper manufacturer, the paper purchaser, and the third-party
advertiser are different entities and the third-party advertiser
pays to have the promotional material placed on the enclosure
of the paper product.

THE REJECTION
The Examiner relies upon the following as evidence of
unpatentability:
Crossman US 5,035,515 Jul. 30, 1991
Itkonen US 5,473,863 Dec. 12, 1995
Ryan US 6,173,274 B1 Jan. 9, 2001
Loeb US 6,421,652 B2 Jul. 16, 2002
Giacomozzi WO 96/29263 Sep. 26, 1996

The following rejections are before us for review.
The Examiner rejected claims 11, 34, and 49 under 35 U.S.C.
§ 101.
The Examiner rejected claims 1-7, 9, 11, 14, 16, 18, 20-32, 34-40, 42,
44-47, 49- 54, 56, 61-63, and 65-67 under 35 U.S.C. § 103(a) over a Ryan in
view of Giacomozzi.
The Examiner rejected claims 8, 43, and 57-59 under 35 U.S.C.
§ 103(a) over Ryan, Giacomozzi, and Itkonen.
The Examiner rejected claims 10, 33, 41, 55, and 64 under 35 U.S.C.
§ 103(a) over Ryan, Giacomozzi, and Crossman.
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The Examiner rejected claims 12-13, 15, 17, 19, and 50 under 35
U.S.C. § 103(a) over Ryan, Giacomozzi, and Loeb.
The Examiner rejected claim 60 under 35 U.S.C. § 103(a) over a
combination of Ryan, Giacomozzi, Itkonen, and Crossman.

ISSUE
Are claims 11, 34, and 49 patent eligible under 35 U.S.C. § 101?
The issue of obviousness turns on whether Ryan discloses or makes
obvious the claim requirement of wherein the promotional material is
specifically targeted to a group of people associated with the paper
purchaser, the group comprising those people likely to purchase the goods or
services of the third-party advertiser.

FINDINGS OF FACT
We find the following facts by a preponderance of the evidence:
1. We adopt the Examiner’s findings as our own as set forth on pages
4-22; we make further findings as follows:
2. Ryan discloses that advertising space on an envelope may contain
one or more messages from third party advertisers. (Col. 7, ll. 45-46).
3. Ryan discloses an address demographics database which in addition
to destination grouping allows for:
Generally, income, age and other demographic statistics (age,
income, education level, marital status, home ownership status,
dependent information, ethnicity, etc.) are available for
different regions of the country and for certain designated
geographic regions.

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(Col. 10, ll. 35-39).
4. Ryan further discloses that:
[T]he delivery point zip code in the hygiened recipient address
50 may be cross referenced to the address demographics
database 812 and the resulting other demographic statistics
compared with the third party advertiser's requirements. For
example, a luxury car manufacturer may only want its messages
going to private residences from regions where the average
income is above a predetermined threshold.

(Col. 10, ll. 40-46).
5. The Examiner found that Loeb:
[T]eaches that intermediary party (i.e. central controller) place
advertisements from different advertisers on physical
statements such as credit card statements or frequent flyer
statements (see col 9, lines 15-25) where said intermediary
receive remuneration from said advertisers (i.e. fee charged) for
said placement (see col 3, line 35 - col 4, line10).

(Answer 21-22).
6. Giacomozzi discloses that advertising space on a wrapper for paper
products may contain one or more messages from third party advertisers.
(Abstract).
7. Itkonen discloses a wrapper which envelopes a paper product.
(Col. 3, ll. 41-46).

ANALYSIS
35 U.S.C. § 101 Rejection
We affirm the rejection of claims 11 and 34 under 35 U.S.C. § 35
U.S.C. § 101, and reverse the rejection of claim 49.
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The Examiner rejected claims 11, 34 and 49 under 35 U.S.C. § 101
because these claims fail to meet the machine or transformation test,
(Answer 3), the so called Bilski test which determines whether a claimed
process recites patentable subject matter under § 101 by testing whether the
involved subject matter: (1) is tied to a particular machine or apparatus, or
(2) transforms a particular article into a different state or thing. In re Bilski,
545 F.3d 943, 961-62 (Fed. Cir. 2008) (en banc).
However, since the filing of the Appeal Brief, the Supreme Court has
held that the “machine-or-transformation may well provide a sufficient basis
for evaluating processes similar to those in the Industrial Age—for example,
inventions grounded in a physical or other tangible form… [but] it may not
make sense to require courts to confine themselves to asking the questions
posed by the machine-or-transformation test”. Bilski v. Kappos, 130 S.Ct.
3218, 3227, 3231 (June 2010). Maintaining only that the test is an
“important clue” or “an investigative tool”, the Court instead reasoned that
claims that explained the basic concept of an activity (hedging) would allow
the Appellant to pre-empt the use of this approach in all fields, and would
effectively grant a monopoly over an abstract idea. Bilski v. Kappos, 130
S.Ct. 3218, 3231 (June 2010). Thus, abstract ideas are not patent eligible.
Id. at 3225.
We turn to the issue at hand with this understanding of the present
status of the law before us today.
Concerning independent claims 11 and 34, we find that these claims
preempt abstract ideas and hence are patent ineligible. More specifically, we
find that the claims’ recitation of the steps of receiving and providing are
merely abstract ideas because each step is recited in the future tense of “to
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place”, “to create, “to deliver”, and hence is only contemplated, rather than
executed. We also find that the step of having the third party pay to
advertise is worded only as a contemplated act to be accomplished in the
future. Likewise, the steps of claim 34 are recited in intended use format
instructing, rather than requiring, acts presently executed.
Each of independent claims 11 and 34 also recites: wherein computer-
executable instructions implementing the method are stored in memory of
the computer system for execution by a processor of the computer system.
We do not find this recitation makes the claims patent eligible to the
extent that computerization is required by the claim, because we find this
step to be limited to insignificant extra solution activity not covered under
35 U.S.C. § 101. See, In re Schrader, 22 F. 3d 290, 294 (Fed. Cir. 1994)
(recording step of the claimed process is incapable of imparting patent-
eligibility under 35 U.S.C. § 101).
However, independent claim 49 recites in pertinent part
“manufacturing the ream of paper ….”
We find that this step is recited as a direct action step and not an
abstraction or an extra-solution item, because it goes to the core of the
claimed manufacturing process.

35 U.S.C. § 103(a) rejection
We affirm the rejection of claims made under 35 U.S.C. § 103(a).
Appellant argues that in Ryan, “[t]he selection of a geographic area
does not define a group, but merely acts as a filter to aid in individual
targeting.” (Appeal Br. 21).
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We disagree with Appellant because we find that Ryan discloses an
address demographic database 812 which groups information type by, e.g.,
age, income, education level, or home ownership, to name a few. (FF 3).
The claims require promotional material be specifically targeted to a group
of people associated with the purchaser, the group comprising those people
likely to purchase the goods or services of the third-party advertiser. We
find that Ryan explicitly discloses this requirement in his example of the
third party advertiser who targets luxury cars to income levels of a
predetermined threshold. (FF 4)
Appellant next argues that “[t]here is nothing in the cited section of
Ryan, or any other section, to suggest that a recipient of a mailpiece
produced by Ryan's system is ‘likely to view the promotional material on the
enclosure for an extended period of time’ as recited by claim 1.” (Appeal Br.
22).
In light of the breadth of the claim, the Appellant’s argument is not
persuasive as to error in the rejection, because it is almost impossible to
objectively assure that Appellant’s paper cover will not be viewed any
longer than the letter cover (envelope) of Ryan.
Appellant next argues that “Ryan teaches away from placing
promotional material on Giacomozzi's wrappers.” (Appeal Br. 22).
We are not persuaded by this argument because both references
concern advertising on a wrapper which medium is not owned by the
advertising entity, i.e., third party. (FF 2, 6). Thus, neither reference actually
teaches away from every aspect of all shopping cart models. See In re
Gurley, 27 F.3d at 553. Thus, as long as the combination is not directed to
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the discouraged aspects of the particular advertising scheme, there is no
teaching away.
Appellant argues that “one skilled in the art would have no reasonable
expectation of success combining Ryan and Giacomozzi because a technique
for doing so would entail complexities that would require a detailed
explanation for one of ordinary skill in the art to implement, which is not
present in either Ryan or Giacomozzi.” (Appeal Br. 24).
The Examiner however found that “… Giacomozzi teaches that it is
old and well known in the promotion art to print promotional messages or
advertisements on the enclosures or wrappers of manufacture products, such
as paper handkerchiefs and where said messages or advertisements are not
linked to the contained paper products in said wrappers (see figure 1;
abstract).” (Answer 6).
We find no error with the combination of Ryan and Giacomozzi as
presented by the Examiner because each is tied to resolving a like problem,
namely, disseminating messages or advertisements not linked to the
contained products being wrapped or enveloped. (FF 2, 6).
Appellant in turn argues that “[i]t is unclear, and neither Ryan nor
Giacomozzi suggest, how one skilled in the art would combine Ryan's
system with Giacomozzi to predict which user would purchase a particular
handkerchief wrapper or to control how that user would publicly display the
handkerchief wrapper.” (Appeal Br. 25)
However, Appellant’s argument seeks an explanation of how each
reference would be bodily incorporated into the other which is not the test
for obviousness. See In re Keller, 642 F.2d 413, 425 (CCPA 1981).
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We therefore find that one skilled in the art would have had a
reasonable expectation of success in combining the teaching of Giacomozzi
of using manufacturer wrappers with the targeted group information of
Ryan, because the geographic grouping of Ryan would be well suited to
targeted marketing of the paper ware product in Giacomozzi where the paper
ware could be most used, e.g., households with children. For obviousness
under § 103, all that is required is a reasonable expectation of success.
Wyers v. Master Lock Co., 616 F.3d 1231, 1242 (Fed. Cir. 2010).
We are also un-persuaded by Appellant’s argument concerning claim
65 that “[n]owhere does Ryan disclose or suggest that the operator of its
mail system instructs another entity to place an advertisement on an
envelope.” (Appeal Br. 30).
Claim 65 recites in pertinent part, “instructing another entity to
dispose the promotional material on the enclosure.”
The Examiner found that in Ryan, the third party advertiser may allow
another third party advertiser to occupy the space. (Answer 10).
Appellant’s arguments fail from the outset because they are not based
on limitations appearing in claim 65, because claim 65 leaves open who it is
that instructs the other entity. In re Self, 671 F.2d 1344, 1348 (CCPA 1982).
We are not persuaded by Appellant’s argument that “Itkonen teaches
away from Ryan” (Appeal Br. 33), because, both references concern using a
wrapper which envelops a paper product contained within. (FF 2, 7). Thus,
neither reference actually teaches away from every aspect of all wrapper
systems. See In re Gurley, 27 F.3d at 553. Thus, as long as the combination
is not directed to the discouraged aspects of wrapping a product, there is no
teaching away.
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Appellant argues that “the Examiner has not identified a sufficient
reason for combining Ryan, Giacomozzi, and Crossman.” (Appeal Br. 36).
We disagree with Appellant because the Examiner found as a reason
that “[i]t would have been obvious to... know that Ryan would include third
party advertisers coupons into a package wrappers, as taught by Crossman in
order to offset the cost of producing said products by billing advertisers for
said including, as taught by Ryan.” (Answer 12).
We find such a reason to be reasonable given that, even if Ryan does
offset the cost of producing mailing by selling advertising space, this cost
could be even more offset or even eliminated by a higher revenue generating
item, such as by using coupons.
Concerning Appellant’s arguments to claim 17, we find the following:
Claim 17 recites in pertinent part “tracking receipt of remuneration
from the paper purchaser to an intermediate party for the paper product.”
Appellant argues that “…the Examiner's characterization of Loeb does
not make reference to the language recited by claim 17, nor does it identify
where Loeb discloses tracking receipt of remuneration.” (Appeal Br. 38)
We disagree with Appellant. We find instead that the Examiner made
additional findings (FF 5) in the Answer as to how Loeb meets the claim
requirement. Appellant’s Reply Brief fails to rebut these finding.
Therefore, we sustain the rejection of claim 17 based on the findings made
by the Examiner in the Answer.
Claim 19 recites in pertinent part wherein the advertisement order
tracker is configured to instruct an intermediate party to place the
advertisement on the wrapper.
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Appellant asserts “the Examiner did not indicate how this feature [of
claim 19] is disclosed or suggested by the references, appellant submits that
the Examiner has failed to establish a prima facie case of obviousness of
claim 19.” (Appeal Br. 39).
We again disagree with Appellant, and instead find that the Examiner
did make out his prima case for claim 19 stating that the third party service
providers of Loeb would also serve as intermediary between purchasers and
advertisers motivated by the remuneration from the interaction. (Answer 12-
13).
Arguments similar to those advanced for claim 19 are made for claim
50, which is similar to claim 19, and thus are not persuasive for the same
reasons.
Appellant next argues that “it is unclear how one of ordinary skill in
the art would integrate Loeb's agents with Ryan's production mail system to
produce the claimed invention.” (Appeal Br. 41).
However, Appellant’s argument seeks an explanation of how each
reference would be bodily incorporated into the other which is not the test
for obviousness. See In re Keller, 642 F.2d 413, 425 (CCPA 1981).
Declaration Evidence
We recognize that evidence of secondary considerations, such as that
presented by the Appellant, must be considered en route to a determination
of obviousness/nonobviousness under 35 U.S.C. § 103. Accordingly, we
consider anew the issue of obviousness under 35 U.S.C. § 103, carefully
evaluating and weighing both the evidence relied upon by the Examiner and
the objective evidence of nonobviousness provided by the Appellant.
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The Appellant presents evidence of commercial success through a
Declaration executed on November 5, 2005.
We examine whether the Appellant met his burden of establishing a
nexus between the claimed invention and the evidence of secondary
considerations. In re Huang, 100 F.3d 135, 139-40 (Fed. Cir. 1996).
We do not find that Appellant met this burden.
Initially we note that even assuming that the Appellant sufficiently
demonstrates commercial success, that success is relevant in the obviousness
context only if it is established that the sales were a direct result of the
unique characteristics of the claimed invention, as opposed to other
economic and commercial factors unrelated to the quality of the claimed
subject matter. See Cable Elec. Products, Inc. v. Genmark, Inc., 770 F.2d
1015, 1027 (Fed. Cir. 1985). In other words, a nexus is required between the
sales and the merits of the claimed invention.
We fail to find such a nexus here. In ex parte proceedings before the
Patent and Trademark Office, an applicant must show that the claimed
features were responsible for the commercial success of an article if the
evidence of nonobviousness is to be accorded substantial weight. Merely
showing that there was commercial success of an article which embodied the
invention is not sufficient. See Ex parte Remark, 15 USPQ2d 1498, 1502-03
(BPAI 1990).
Appellant’s Declaration states that “The increased sales of cartons to
Costco is a direct result of the invention.” (Declaration ¶5).
We are not persuaded by this statement because an inventor’s opinion
as to the purchaser’s reason for buying the product is insufficient to
demonstrate a nexus between the sales and the claimed invention. In re
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Huang, 100 F.3d 135, 140 (Fed. Cir. 1996). Further, gross sales figures do
not show commercial success absent evidence as to market share, Cable
Electric Products, Inc. v. Genmark, Inc., 770 F.2d 1015 (Fed. Cir. 1985).
Appellant further argues:
Although the Declaration did not include
information as to market share, the Declaration
included (a) information as to the time period
during which the product was sold (e.g., paragraph
4 states that the product was sold between July 17,
2005 and September 25, 2005), and (b)
information as to what sales would normally be
expected in the market (e.g., paragraph 4 states
that before the claimed invention was sold, the
average number of cartons shipped each week was
1,933).
(Appeal Br. 42).
We are not persuaded by this evidence because it fails to account for
in any cogent manner (1) the nature and extent of advertising, (2) pricing
(e.g., were cartons sold at a low price to gain a market share?) and/or recent
changes in related technology or consumer demand which might have
caused the change in the sales numbers during the reference periods. See
Pentec, Inc. v. Graphic Controls Corp., 776 F.2d 309, 315 (Fed. Cir. 1985)
(commercial success may have been attributable to extensive advertising and
position as a market leader before the introduction of the patented product);
In re Fielder, 471 F.2d 640, 646 (CCPA 1973) (success of invention could
be due to recent changes in related technology or consumer demand; here
success of claimed voting ballot could be due to the contemporary drive
toward greater use of automated data processing techniques).
We find that the Declaration fails to provide any credible nexus
between the features of the claimed invention and the alleged commercial
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sales. In re Fielder, 471 F.2d 640, 642 (CCPA 1973). The alleged
commercial success here fails to carry the day.

CONCLUSIONS OF LAW
We conclude the Examiner did not err in rejecting claims 1-47, 49-67
under 35 U.S.C. § 103(a).
We conclude the Examiner did not err in rejecting claims 11 and 34
under 35 U.S.C. § 101 and did err in the rejection of claim 49 under 35
U.S.C. § 101.
DECISION
The decision of the Examiner to reject claims 1-47, 49-67 is
AFIRMED.

AFFIRMED

MP