Ex Parte Stone

Patent Trial and Appeal Board

Apr 25, 2018

12817788 (P.T.A.B. Apr. 25, 2018)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE
12/817,788 06/17/2010
23460 7590 04/27/2018
LEYDIG VOIT & MA YER, LTD
TWO PRUDENTIAL PLAZA, SUITE 4900
180 NORTH STETSON A VENUE
CHICAGO, IL 60601-6731
FIRST NAMED INVENTOR
Stephen J. Stone
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
ATTORNEY DOCKET NO. CONFIRMATION NO.
706488 6315
EXAMINER
TRAN, HAI
ART UNIT PAPER NUMBER
3694
NOTIFICATION DATE DELIVERY MODE
04/27/2018 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):
Chgpatent@leydig.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte STEPHEN J. STONE
Appeal2017-001294
Application 12/817, 788 1
Technology Center 3600
Before CAROLYN D. THOMAS, IRVINE. BRANCH, and
MICHAEL J. ENGLE, Administrative Patent Judges.
ENGLE, Administrative Patent Judge.
DECISION ON APPEAL
Appellant appeals under 35 U.S.C. § 134(a) from a final rejection of
claims 1-6, 9-13, 15, 16, and 19-23, which are all of the claims pending in
the application. We have jurisdiction under 35 U.S.C. § 6(b ).
We AFFIRM.
Technology
The application relates to "determining a fee for an investment
product having a guaranteed benefit ... based upon at least one
measurement of market volatility." Spec. Abstract.
1 According to Appellant, the real party in interest is American International
Group, Inc. App. Br. 1.
Appeal2017-001294
Application 12/817, 788
Illustrative Claim
Claim 1 is illustrative and reproduced below:
1. A computer-implemented system for determining a variable
fee for a guaranteed benefit of an investment product, the
investment product having a term including a plurality of time
periods, the system comprising:
a physical computer-readable medium including an
investment product pricing program;
a processor adapted to execute the investment product
pricing program contained on the physical computer-readable
medium; and
a web server in communicative relationship with the
processor and to an external network;
wherein the investment product pricing program includes
a pricing module having computer executable instructions
adapted to periodically determine the variable fee for the
guaranteed benefit based upon market volatility data for the
period received by the processor from an information source via
the web server, the market volatility data including a numerical
volatility value correlated to a measure of market volatility such
that the numerical value increases as the market volatility
increases, the numerical volatility value being correlated to
hedging costs associated with the guaranteed benefit, the pricing
module being adapted to calculate the variable fee for the period
based upon a non-discretionary formula including the numerical
volatility value.
Re} ection on Appeal
Claims 1---6, 9-13, 15, 16, and 19-23 stand rejected under 35 U.S.C.
§ 101 as being directed to ineligible subject matter. Final Act. 3. 2
2 The Examiner withdrew the rejection under 35 U.S.C. § 103. See Ans. 2.
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Appeal2017-001294
Application 12/817, 788
ISSUE
Did the Examiner err in determining that claim 1 did not add
significantly more than the abstract idea?
ANALYSIS
To determine patentable subject matter, the Supreme Court has set
forth a two part test. "First, we determine whether the claims at issue are
directed to one of those patent-ineligible concepts" of "laws of nature,
natural phenomena, and abstract ideas." Alice Corp. v. CLS Bank Int 'l, 134
S. Ct. 2347, 2355 (2014). In the second step, we "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." Id. (quoting Mayo Collaborative Servs. v.
Prometheus Labs., Inc., 566 U.S. 66, 79, 78 (2012)). The Supreme Court
has "described step two of this analysis as 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 concept itself." Id. (quotation omitted).
Here, the Examiner concludes that claim 1 is directed to "a
mathematical relationship/formula for hedging" that is "analogous to Bilski
v. Kappas." Ans. 5. Appellant only argues step 2 of the Alice/Mayo
framework. App. Br. 5; Ans. 5.
Appellant argues "the applied [prior art] reference fails to render
claim 1 unpatentable" under § 103 and the invention "is a significant
improvement over any existing technological system/process known at the
time of the invention." App. Br. 7. We agree with the Examiner, however,
that§ 101 is a different requirement than§ 102 or§ 103. Ans. 8. As the
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Appeal2017-001294
Application 12/817, 788
Federal Circuit has said, "under the Mayo/Alice framework, a claim directed
to a newly discovered law of nature (or natural phenomenon or abstract idea)
cannot rely on the novelty of that discovery for the inventive concept
necessary for patent eligibility." Genetic Techs. Ltd. v. Merial L.L. C., 818
F.3d 1369, 1376 (Fed. Cir. 2016).
Appellant also argues "[ t ]he claimed solution is rooted in computer
technology in order to satisfy persistent needs specifically arising in the field
of investment products." App. Br. 7. "But, as we have said before, merely
limiting the field of use of the abstract idea to a particular environment does
not render the claims any less abstract." Smart Sys. Innovations, LLC v.
Chicago Transit Auth., 873 F.3d 1364, 1373 (Fed. Cir. 2017) (quotation
omitted); see also Ans. 5. We also agree with the Examiner that "[t]he claim
is not rooted in computer technology. Rather, it deploys computer
technology." Ans. 7. The Examiner correctly found that all of the recited
computer elements (e.g., "a physical computer-readable medium"; "a
processor"; "a web server"; and "an external network") were merely "a
recitation of generic computer structure that serves to perform generic
computer functions that are well-understood, routine, and conventional
activities." Id. at 6. As the Supreme Court has said, "simply implementing
a mathematical principle on a physical machine, namely a computer, [is] not
a patentable application of that principle." Mayo, 132 S. Ct. at 1301. That is
particularly true when, as here, "the computer implementation [i]s purely
conventional" because "the mere recitation of a generic computer cannot
transform a patent-ineligible abstract idea into a patent-eligible invention."
Alice, 134 S. Ct. at 2358.
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Appeal2017-001294
Application 12/817, 788
Here, the invention is not any technology but rather the abstract idea
of setting a variable fee for a guaranteed benefit based on market volatility.
As Appellant points out, this correlates the fee with hedging costs. App. Br.
6; see also claim 1 ("the numerical volatility value being correlated to
hedging costs associated with the guaranteed benefit"); Ans. 5 ("a
mathematical relationship/formula for hedging"). We agree with the
Examiner that the claims here are analogous to that in Bilski v. Kappas,
which involved "a claimed invention that explains how buyers and sellers of
commodities in the energy market can protect, or hedge, against the risk of
price changes." Bilski v. Kappas, 561 U.S. 593, 599 (2010). The Supreme
Court there held that "[t]he concept of hedging ... is an unpatentable
abstract idea." Id. at 611. The same is true here for the particular form of
hedging in claim 1.
Accordingly, we sustain the rejection of claim 1 under § 101, and
claims 2-5, 9-13, 15, 16, and 19-23, which Appellant argues are patentable
for similar reasons. See App. Br. 8-12; 37 C.F.R. § 41.37(c)(l)(iv).
DECISION
For the reasons above, we affirm the Examiner's decision rejecting
claims 1---6, 9-13, 15, 16, and 19-23 under§ 101.
No time for taking 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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