Ex Parte ShaperDownload PDFPatent Trial and Appeal BoardDec 9, 201310433914 (P.T.A.B. Dec. 9, 2013) Copy Citation 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. 10/433,914 06/04/2003 Stephen J. Shaper 50134 4189 22929 7590 12/09/2013 Sue Z. Shaper 1800 WEST LOOP SOUTH SUITE 350 HOUSTON, TX 77027 EXAMINER LOFTUS, ANN E ART UNIT PAPER NUMBER 3692 MAIL DATE DELIVERY MODE 12/09/2013 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 STEPHEN J. SHAPER ___________ Appeal 2011-010037 Application 10/433,914 Technology Center 3600 ____________ Before MEREDITH C. PETRAVICK, NINA L. MEDLOCK, and THOMAS F. SMEGAL, Administrative Patent Judges. PETRAVICK, Administrative Patent Judge. DECISION ON APPEAL Appeal 2011-010037 Application 10/433,914 2 STATEMENT OF THE CASE Stephen J. Shaper (Appellant) seeks our review under 35 U.S.C. § 134 of the final rejection of claims 1-20. We have jurisdiction under 35 U.S.C. § 6(b). SUMMARY OF DECISION We AFFIRM. 1 THE INVENTION The invention is a method “for facilitating charge card transactions comprising evaluating electronically transmitted data (including over the Internet and the like) relating to a charge card transaction and guaranteeing a charge card transaction that meets certain criteria.” Spec. 5:1-5. Claims 1 and 15, reproduced below, are illustrative of the subject matter on appeal. 1. A method for facilitating card not presented (CNP) charge card transactions, by guaranteeing against lack of genuineness, comprising: receiving, by a third party distinct from a merchant and a charge card issuer, by computer, electronically transmitted CNP data directly or indirectly from the merchant related to a CNP charge card transaction; evaluating by a computer the CNP transaction data in light of a third party database and statistical history and certain predetermined criteria; and contractually guaranteeing by the third party, based on the computer receiving and evaluating CNP transaction data meeting certain pre-determined criteria, the guaranteeing 1 Our decision will make reference to the Appellant’s Appeal Brief (“App. Br.,” filed October 21, 2010), Appellant’s Reply Brief (“Reply Br.,” filed April 4, 2011), and Examiner’s Answer (“Ans.,” mailed March 3, 2011). Appeal 2011-010037 Application 10/433,914 3 including against risk of loss to the merchant due to at least certain predetermined cardholder nonpayment events based on lack of genuineness of the CNP transaction. 15. A method for facilitating charge card transactions, comprising: receiving, by a third party distinct from a merchant and a charge card issuer, by computer, electronically transmitted data directly or indirectly from the merchant related to a charge card transaction, evaluating by a computer the charge card transaction data in light of certain predetermined criteria; and contractually guaranteeing, by the third party, based on the computer receiving and evaluating charge card transaction data that meets certain predetermined criteria, a charge card issuer and/or transaction clearing system against risk of loss from a merchant non-payment of a non-reversed chargeback. THE REJECTIONS The Examiner relies upon the following as evidence of unpatentability: Nair US 5,438,186 Aug. 1, 1995 Aharoni US 5,694,552 Dec. 2, 1997 Gopinathan US 5,819,226 Oct. 6, 1998 Aleia US 5,991,733 Nov. 23, 1999 Lowery US 6,189,785 B1 Feb. 20, 2001 Weller US 2002/0111919 A1 Aug. 15, 2002 The Appellant relies upon the following as evidence of patentability: Attachment A: David Montague, Credit Card Fraud The Professional’s Guide to Preventing Credit Card Fraud in E-commerce Mail Order and Telephone Sales, pp. 11-12, 39-46 (Tafford Publishing, 2004) Appeal 2011-010037 Application 10/433,914 4 Attachment B: Visa Payer Authentication Service Description Payer Authentication Request for Proposal Version 1.0, Visa USA, March 2000 Visa Payer Authentication Service Design Requirements, Version 1.1, Visa USA, April 20, 2000 Attachment C: Justice (US 6,516,016, iss. Feb. 4, 2003) Lee (US 7,251,624, iss. Jul. 31, 2007) Attachment D: e-mail from Lori Breitzke to Randy Templeton dated Thursday, January 17, 2008 at 3:01pm Subject: Chargeback/fraud numbers for you, Attachment E: Card Not Present Transactions Visa Merchant Resource Center, Card Not Present Fraud, http://www.usa.visa.comlmerchants/risk management/card_ not_present.html (last visited 04/22/2008) Attachment F: Affidavit of Stephen J. Shaper, February 10, 2010 Attachment H: Definition of “certain,” Merriam-Webster Online, hnp://www.merriam- webster.comJdictionary/certain (last visited 02/09/2010) Attachment K: Definition of “predictable,” Merriam-Webster Online, http://www_webster.comJdictionary/predictable (last visited 01/07/2008) Attachment N: Noblett, Jr. et al. (US 5,334,823, iss. Aug. 2, 1994) Appeal 2011-010037 Application 10/433,914 5 The following rejections are before us for review: 1. Claims 1-20 are rejected under 35 U.S.C. § 101 as being directed to non-statutory matter. 2. Claims 1-20 are rejected under 35 U.S.C. § 112, second paragraph, as indefinite for failing to particularly point out and distinctly claim the subject matter which Applicant regards as the invention. 3. Claims 1-9, 12, and 18-20 are rejected under 35 U.S.C. § 103(a) as being unpatentable over Nair, Weller, and Gopinathan. 4. Claims 10 and 13 are rejected under 35 U.S.C. § 103(a) as being unpatentable over Nair, Weller, Gopinathan, and Aharoni. 5. Claim 11 is rejected under 35 U.S.C. § 103(a) as being unpatentable over Nair, Weller, Gopinathan, Lowery, and Aleia. 6. Claim 14 is rejected under 35 U.S.C. § 103(a) as being unpatentable over Nair, Weller, Gopinathan, Aharoni, and Aleia. 7. Claims 15 and 16 are rejected under 35 U.S.C. § 103(a) as being unpatentable over Nair and Gopinathan. 8. Claim 17 is rejected under 35 U.S.C. § 103(a) as being unpatentable over Nair, Gopinathan, Aharoni, and Aleia. ISSUES The first issue is whether claims 1-20 are non-statutory for being directed to an abstract idea. The second issue is whether claims 1-20 are indefinite under 35 U.S.C. § 112, second paragraph. Specifically: whether claims 1, 11, and 15 are ambiguous due to a lack of an objective standard for determining certainty in certain predetermined criteria; whether claim 7 is ambiguous due Appeal 2011-010037 Application 10/433,914 6 to a lack of objective standard for determining predictability in a predictable pre-arranged fee; and, whether claims 15 and 16 are ambiguous due to the meaning of a non-reversed chargeback? The third issue is whether claims 1-9, 12, and 18-20 are unpatentable under 35 U.S.C. § 103(a) over Nair, Weller, and Gopinathan. Specifically, the major issue is whether one of ordinary skill in the art would have found it obvious to combine teachings related to card-present transactions with teachings related to card-not-present transactions. The rejections of: claims 10 and 13 under 35 U.S.C. § 103(a) as being unpatentable over Nair, Weller, Gopinathan, and Aharoni; claim 11 under 35 U.S.C. § 103(a) as being unpatentable over Nair, Weller, Gopinathan, Lowery, and Aleia; and claim 14 under 35 U.S.C. § 103(a) as being unpatentable over Nair, Weller, Gopinathan, Aharoni, and Aleia also turn on this issue. The fourth issue is whether claims 15 and 16 are unpatentable under 35 U.S.C. § 103(a) over Nair and Gopinathan. Specifically, whether Nair teaches guaranteeing against loss from a merchant non-payment of a non- reversed chargeback? The rejection of claim 17 under 35 U.S.C. § 103(a) as being unpatentable over Nair, Gopinathan, Aharoni, and Aleia also turns on this issue. FINDINGS OF FACT We find that the findings of fact, which appear in the Analysis below, are supported by at least a preponderance of the evidence. Ethicon, Inc. v. Quigg, 849 F.2d 1422, 1427 (Fed. Cir. 1988) (explaining the general evidentiary standard for proceedings before the Office). Appeal 2011-010037 Application 10/433,914 7 ANALYSIS The rejections of claims 1-20 under 35 U.S.C. §101 as being directed to non-statutory subject matter The Appellant argues claims 1-20 as a group. See App. Br. 9-12. We select claim 1 as the representative claim for this group, and the remaining claims 2-20 stand or fall with claim 1. 37 C.F.R. § 41.37(c)(1)(vii). We are not persuaded by the Appellant’s argument (App. Br. 9-12 and Reply Br. 1-4) that the Examiner erred in rejecting claim 1 under 35 U.S.C. §101 as being directed to non-statutory subject matter. The Examiner found that claim 1 fails the machine-or-transformation test because: 1) claim 1’s recitation of a computer is a nominal tie to a machine and 2) claim 1 does not recite any transformation of a particular article. Ans. 4-6. The Appellant contests both of the Examiner’s findings. The Supreme Court has clarified in Bilski that while the machine-or- transformation test “is not the sole test for deciding whether an invention is a patent-eligible ‘process’ under §101,” it remains a “useful and important clue [or] investigative tool.” Bilski v. Kappos, 130 S.Ct. 3218, 3227 (2010). We note that the failure of the claims to satisfy the machine-or- transformation test is the only matter being contested. Turning to the machine prong, Appellant argues that claim 1’s recitation of a computer is not nominal because the computer evaluating the data is central to the invention and the guaranteeing is based upon this evaluation. App. Br. 9-10. However, neither claim 1 nor the Specification2 2 We note that in the Summary of the Claimed Subject Matter section of the Appeal Brief, Appellant points to: page 1, lines 19-23 and 26-27 (describing a prior art check guaranteeing entity); page 6, lines 17-24 (describing a Appeal 2011-010037 Application 10/433,914 8 sets forth any specific evaluating means or algorithm other than broadly describing that customer or card information is accessed. See for example, 6:19-24. Contrary to Appellant’s argument, this limitation seems to be nothing more than the concept of evaluating whether to guarantee a transaction based on information and criteria with a nominal recitation of a computer. We note that claim 1 does not require that the computer perform the guaranteeing step. Therefore, we find that this recitation of a “computer” is, at best, a nominal recitation of a machine and provides no meaningful limits on the scope of the claim. See Gottschalk v. Benson, 409 U.S. 63, 71-72 (1972) and Parker v. Flook, 437 U.S. 584, 590 (1978). Second, Appellant argues that transforming transaction data into predictive data satisfies the transformation test. However, “[t]he mere manipulation or reorganization of data . . . does not satisfy the transformation prong.” CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d 1366, 1375 (Fed. Cir. 2011). Accordingly, the rejection of claims 1-20 under 35 U.S.C. §101 as being directed to non-statutory subject matter is affirmed. The rejections of claims 1-20 under 35 U.S.C. § 112, second paragraph, as being indefinite We are persuaded by the Appellant’s argument (App. Br. 12-13) that the Examiner erred in rejecting claims 1-20 under 35 U.S.C. §112, second paragraph, as being indefinite. merchant sending customer and card information to a guarantee service); page 8, lines 23-29 (broadly describing guarantor paying a chargeback to a merchant), and DB of Figure 1 (depicted as a box). Appeal 2011-010037 Application 10/433,914 9 A claim is considered indefinite under 35 U.S.C. § 112, second paragraph, if it does not reasonably apprise those skilled in the art of its scope. IPXL Holdings, L.L.C. v. Amazon.com, Inc., 430 F.3d 1377, 1383-84 (Fed. Cir. 2005). Only when a claim remains insolubly ambiguous, without a discernible meaning after all reasonable attempts at construction, must a court declare it indefinite. ExxonResearch & Eng'g Co. v. United States, 265 F.3d 1371, 1375 (Fed. Cir. 2001). The “certain” issue The Examiner found that claims 1, 11, and 15 are indefinite because these claims recite the term “certain,” and the Specification does not set forth a standard for ascertaining the requisite degree of certainty required. Ans. 7. We agree with the Appellant (App. Br. 12-13) that the Examiner’s rejection is based upon an unreasonable interpretation of “certain” in light of the Specification, and that, when interpreted to mean fixed or settled, the scope of the claim is not insolubly ambiguous The “predictable” issue The Examiner found that the scope of claim 7 is indefinite because “predictable” does not have a standard for ascertaining the requisite degree of predictability required. Ans. 7. We agree with the Appellant (App. Br. 13-14) that the meaning of “predictable” in light of the Specification is “capable of being foretold” (App. Br 14) and not insolubly ambiguous. The “non-reversed chargeback” issue The Examiner found that the scope of claims 15 and 16 are indefinite because the meaning of a non-reversed chargeback is ambiguous. Ans. 7-8. Appeal 2011-010037 Application 10/433,914 10 We agree with the Appellant (App. Br. 14-15 and Reply Br. 4) that, based upon the Specification and the prosecution history, the meaning of non- reversed chargeback is not insolubly ambiguous. Accordingly, the rejection of claims 1-20 under 35 U.S.C. § 112, second paragraph, as being indefinite is reversed. The rejection of claims 1-9, 12, and 18-20 under 35 U.S.C. § 103(a) as being unpatentable over Nair, Weller, and Gopinathan The Appellant argues claims 1-9, 12, and 18-20 as a group. See App. Br. 9-12. We select claim 1 as the representative claim for this group, and the remaining claims 2-9, 12, and 18-20 stand or fall with claim 1. 37 C.F.R. § 41.37(c)(1)(vii). We are not persuaded by Appellant’s arguments (App. Br. 15-23; Reply Br. 5-9) that the Examiner erred in rejecting claim 1 as being unpatentable under 35 U.S.C. § 103(a) over Nair, Weller, and Gopinathan. The Appellant makes several arguments contesting the Examiner’s combination of Nair, Weller, and Gopinathan. At the crux of these arguments, is a dispute as to whether one of ordinary skill in the art would have found it obvious to use a third-party to guarantee against the risk of non-payment in card-not-present transactions, given the teachings of the prior art. The Examiner found that Nair teaches using a third-party to guarantee against the risk of non-payment in card-present transactions. Ans. 8-9. Nair states: Pre-authorize or verification of each transaction usually reduces a merchant’s risk of loss by passing it to a third party or transaction guarantor. Third party transaction guarantors Appeal 2011-010037 Application 10/433,914 11 contract with the merchant to provide credit card or check authorization services. Col. 1, ll. 64 –68. See also col. 2, ll. 1-24. The Examiner then relies upon Weller to teach that a card-not-present transaction suffers from the same risk of non-payment. Ans. 9. Weller teaches that card-present transactions and card-not-present transactions incur the same risks (see Weller ¶¶ [0003]-[0004]) and describes a system for authentication of card-not-present transactions so that card-not-present transactions can be guaranteed (see Weller ¶ [0010]; see also ¶ [0067] (“provide the merchant with guaranteed payment”)). Weller states: “[t]he service of the present invention presents many advantages. For example, the authentication service lays the foundation for establishing guaranteed payments for merchants involved with ‘card not present’ transactions.” ¶ [0010]. We find that Weller teaches that: 1) guaranteeing card-not-present transactions are desirable for a merchant, and 2) one of ordinary skill in the art would look to card-present transactions for teachings as to how to guarantee card-not-present transactions. Given this, we agree with the Examiner that one of ordinary skill in the art would have found it obvious to use a third-party guarantor of card-present transactions in a card-not-present transaction. We note that the Appellant’s own Specification describes that third-party guarantors for checks (another type of payment method) were previously known in the art. Spec. 1:19-23. We find that the Examiner has established a prima facie showing of obviousness. To rebut the Examiner’s prima facie showing of obviousness, the Appellant submits evidence of secondary considerations of unexpected results or unpredictability. See Evidence Appx. A-F. We consider anew the Appeal 2011-010037 Application 10/433,914 12 issue of obviousness under 35 U.S.C. § 103, carefully evaluating and weighing both the evidence relied upon in finding obviousness and the evidence provided by Appellant. See In re Piasecki, 745 F.2d 1468, 1472 (Fed. Cir. 1984); Stratoflex, Inc. v. Aeroquip Corp., 713 F.2d 1530, 1538 (Fed. Cir. 1983). To be given substantial weight in the determination of obviousness or nonobviousness, evidence of secondary considerations must be relevant to the subject matter as claimed, and therefore we must determine whether there is a nexus between the merits of the claimed invention and the evidence of secondary considerations. Ashland Oil, Inc. v. Delta Resins & Refractories, Inc., 776 F.2d 281, 305 n.42 (Fed. Cir. 1985), cert. denied, 475 U.S. 1017 (1986). Here, inventor Mr. Shaper’s Affidavit merely asserts, in pertinent part, that: 1) “the level in risk involved in accepting “card not presented” transactions for a merchant is at least an order of magnitude beyond that for card presented transactions;” 2) “it was not obvious that my invention would work for its intended purpose;” and 3) “it was necessary to test prototypes of my invention to prove to myself, and to commercial entities interested in implementing the invention, that the invention would work for its intended purpose.” Evidence Appx. Attachment F, p. 2. Mr. Shaper’s Affidavit does not provide any details regarding the tested prototypes or invention mentioned in the Affidavit in order to establish a nexus with the claimed invention. Further, Mr. Shaper’s Affidavit does not establish that the amount of risk involved in card-not- present transactions was the reason why prototype testing was necessary for Appeal 2011-010037 Application 10/433,914 13 the interested commercial entities. Consequently, we cannot conclude whether this evidence is commensurate with the scope of the claim. Therefore, we do not find the Appellant’s evidence of secondary considerations outweighs the prima facie showing of obviousness. Finally, as to the Appellant’s numerous arguments that the prior art teaches away from the Examiner’s combination (for example see App. Br. 17), A reference may be said to teach away when a person of ordinary skill, upon reading the reference, would be discouraged from following the path set out in the reference, or would be led in a direction divergent from the path that was taken by the applicant. The degree of teaching away will of course depend on the particular facts; in general, a reference will teach away if it suggests that the line of development flowing from the reference's disclosure is unlikely to be productive of the result sought by the applicant. In re Gurley, 27 F.3d 551, 553 (Fed. Cir. 1994); see KSR Int'l Co. v. Teleflex, Inc., 550 U.S. 398, 416 (2007) (explaining that when the prior art teaches away from a combination, that combination is more likely to be nonobvious). We see nothing in Nair, Weller, or Gopinathan that discourages or criticizes the Examiner’s proposed modification of Nair to include card-not-present transactions. Accordingly, the rejection of claims 1-9, 12, and 18-20 under 35 U.S.C. § 103(a) as being unpatentable over Nair, Weller, and Gopinathan is affirmed. The rejections of: claims 10 and 13 under 35 U.S.C. § 103(a) as being unpatentable over Nair, Weller, Gopinathan, and Aharoni; claim 11 under 35 U.S.C. § 103(a) as being unpatentable over Nair, Weller, Gopinathan, Appeal 2011-010037 Application 10/433,914 14 Lowery, and Aleia; and claim 14 under 35 U.S.C. § 103(a) as being unpatentable over Nair, Weller, Gopinathan, Aharoni, and Aleia The rejections of claims 10, 11, 13, and 14 are affirmed because these claims depend from claims whose rejections are affirmed above; none of claims 10, 11, 13, and 14 was separately argued. The rejection of claims 15 and 16 under 35 U.S.C. § 103(a) as being unpatentable over Nair and Gopinathan We are persuaded by Appellant’s arguments (App. Br. 23-27; Reply Br. 9-11) that the Examiner erred in rejecting claim 15 as being unpatentable under 35 U.S.C. § 103(a) over Nair and Gopinathan. At issue is claim 15’s recitation of guaranteeing against loss from “a merchant non-payment of a non-reversed chargeback.” In the rejection, the Examiner relies upon Nair, column 1, line 63 to column 2, line 49, which discusses chargeback protection, to teach this limitation. Ans. 16. We fail to see how Nair’s disclosure of chargeback protection teaches the limitation at issue. See App. Br. 25-26. We note that the Examiner does not provide any other evidence or rationale regarding the obviousness of this limitation. Accordingly, the rejection of claim 15, and claim 16, dependent thereon, under 35 U.S.C. § 103(a) as unpatentable over Nair and Gopinathan is reversed. The rejection of claim 17 under 35 U.S.C. § 103(a) as being unpatentable over Nair, Gopinathan, Aharoni, and Aleia The rejection of claim 17 is reversed because this claim depends from claim 15, whose rejection is reversed above. In re Fritch, 972 F.2d 1260, Appeal 2011-010037 Application 10/433,914 15 1266 (Fed. Cir. 1992) (“[D]ependent claims are nonobvious if the independent claims from which they depend are nonobvious.”). DECISION The decision of the Examiner to reject claims 1-20 under 35 U.S.C. § 101 is affirmed. The decision of the Examiner to reject claims 1-20 under 35 U.S.C. § 112, second paragraph, is reversed. The decision of Examiner to reject claims 1-14 and 18-20 under 35 U.S.C. § 103(a) is affirmed. The decision of Examiner to reject claims 15-17 under 35 U.S.C. § 103(a) is reversed. 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). AFFIRMED Klh Copy with citationCopy as parenthetical citation