Ex Parte Taylor et al

Patent Trial and Appeal Board

Jan 4, 2018

11274875 (P.T.A.B. Jan. 4, 2018)

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.
11/274,875 11/15/2005 Don Taylor blanket parent 7412
24987 7590 01/08/2018
MARCUS G THEODORE, PC
Marcus G. Theodore
P.O. Box 58108
SALT LAKE CITY, UT 84158
EXAMINER
POLLOCK, GREGORY A
ART UNIT PAPER NUMBER
3695
NOTIFICATION DATE DELIVERY MODE
01/08/2018 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):
theodore @ xmis sion. com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte DON TAYLOR and MARCELLUS BARRUS
Appeal 2016-005980
Application 11/274,875
Technology Center 3600
Before MICHAEL J. STRAUSS, SHARON FENICK, and
MICHAEL J. ENGLE, Administrative Patent Judges.
STRAUSS, Administrative Patent Judge.
DECISION ON APPEAL
Appeal 2016-005980
Application 11/274,875
STATEMENT OF THE CASE
Appellants appeal under 35 U.S.C. § 134(a) from the Final Rejection
of claims 1—39, 42, and 43. Claims 40, 41 and 44-47 are canceled. We
have jurisdiction under 35 U.S.C. § 6(b).
We affirm.
THE INVENTION
The claims are directed to insuring multiple unit dwellings. Spec.,
Title. Claim 1, reproduced below, is illustrative of the claimed subject
matter:
1. A method for insuring an apartment or multi-unit dwelling
with renters legal liability insurance comprising:
a. periodically updating and inputting into a computer
processor a renters legal liability qualification tangible
non-transitory memory database of:
i. building physical information,
ii. the number of units in the apartment complex or
multi-unit dwelling complex to quality the complex
or multi-unit dwelling for coverage,
iii. actuarial insurance rates for renter’s legal liability
insurance,
iv. lease agreement requirements insuring owners
against tenant contract breaches failing to protect the
apartment or multi-unit dwelling from losses from
fire; smoke; explosion, including the explosion of
gases or fuel within the furnace of any fired vessel or
within the flues or passages through which the gases
of combustion pass; and water that backs up or
overflows from a sewer, drain or sump, and water or
other liquids that leak, flow or overflows from
plumbing heating air conditioning, or other
equipment fixtures,
v. tenant identity and insurance status of each occupied
unit,
2
Appeal 2016-005980
Application 11/274,875
vi. insurance carrier actuarial risk assessment pre­
qualification requirements of the apartment or multi­
unit dwelling for renter’s legal liability insurance,
and/or tenant occupancy insurance insuring owners
against tenant contract breaches failing to protect the
apartment or multi-unit dwelling from losses from
fire; smoke; explosion, including the explosion of
gases or fuel within the furnace of any fired vessel or
within the flues or passages through which the gases
of combustion pass; and water that backs up or
overflows from a sewer, drain or sump, and water or
other liquids that leak, flow or overflows from
plumbing heating air conditioning, or other
equipment fixtures,
vii. frequency review requirements for periodic updates
of the database regarding building occupancy and
types of tenants to maintain prequalification status,
and
viii. the identity of the insured non-occupying building
owner and/or property manager of an apartment or
multi-unit dwelling,
b. maintaining the pre-qualification requirements for the
apartment or multi-unit dwelling to be eligible for renters
legal liability insurance via a qualifying matching program
inputted into the computer processor to periodically sort
the renters legal liability qualification database by building
address to create a working database of the insurance
status of each tenant by monitoring the insurance carrier
actuarial risk pre-qualification requirements and insuring
that the pre-qualifications are maintained during
operations of the apartment or multi-unit dwelling,
c. generating by the computer processor a replacement cost
rate based on the number of insured units, and a percentage
of the insured units additionally covered by tenant
occupancy insurance written on a group rate based on
large numbers providing universal, capped, add-on
insurance coverage to occupants of the entire apartment or
multi-unit dwelling for a renters legal liability single
interest insurance policy,
3
Appeal 2016-005980
Application 11/274,875
d. issuing a renters legal liability single interest insurance
policy to the non-occupying building owner covering the
non-occupying building owner and/or property manager
of a qualified apartment or multi-unit dwelling as the
named insured from the unintentional contract breach
damages caused by the tenant from the selected perils, and
e. billing the owner for the renter’s legal liability insurance
coverage.
Appeal Br. 21—22 (Claims Appendix).
REJECTION
The Examiner rejected claims 1—39, 42, and 43 under 35 U.S.C. § 101
as directed to a judicial exception (i.e., an abstract idea) without significantly
more.
ANALYSIS
Appellants’ arguments are unpersuasive of reversible Examiner error.
We concur with the results reached by the Examiner. We highlight the
following for emphasis.
Patentable Subject Matter
Under 35 U.S.C. § 101, a patent may be obtained for “any new and
useful process, machine, manufacture, or composition of matter, or any new
and useful improvement thereof.” The Supreme Court has “long held that
this provision contains an important implicit exception: Laws of nature,
natural phenomena, and abstract ideas are not patentable.” Alice Corp. v.
CLS BankInt’l, 134 S. Ct. 2347, 2354 (2014) (quoting Ass’n for Molecular
Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107, 2116 (2013)). The
Supreme Court in Alice reiterated the two-step framework previously set
4
Appeal 2016-005980
Application 11/274,875
forth in Mayo Collaborative Services v. Prometheus Laboratories, Inc., 132
S. Ct. 1289, 1300 (2012), “for distinguishing patents that claim laws of
nature, natural phenomena, and abstract ideas from those that claim patent-
eligible applications of these concepts.” Alice, 134 S. Ct. at 2355. The first
step in that analysis is to “determine whether the claims at issue are directed
to one of those patent-ineligible concepts,” such as an abstract idea (Step 1
of the Alice/Mayo test). The inquiry often is whether the claims are directed
to “a specific means or method” for improving technology or whether they
are simply directed to an abstract end result. McRO, Inc. v. Bandai Namco
Games Am. Inc., 837 F.3d 1299, 1314 (Fed. Circ. 2016). If the claims are
not directed to a patent-ineligible concept, the inquiry ends. Otherwise, the
inquiry proceeds to the second step where the elements of the claims are
considered “individually and ‘as an ordered combination’ to determine
whether the additional elements ‘transform the nature of the claim’ into a
patent-eligible application” (Step 2 of the Alice/Mayo test). Alice, 134 S. Ct.
at 2355 (quoting Mayo, 132 S. Ct. at 1298, 1297). We look to whether the
claims focus on a specific means or method that improves the relevant
technology or are instead directed to a result or effect that itself is the
abstract idea and merely invoke generic processes and machinery. See
Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1336, 1338—1339 (Fed. Cir.
2016).
Step One — Whether the Claims Are Directed to an Abstract Idea
“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, 134 S. Ct. at 2355. A court must be cognizant that
“all inventions at some level embody, use, reflect, rest upon, or apply laws
5
Appeal 2016-005980
Application 11/274,875
of nature, natural phenomena, or abstract ideas” {Mayo, 132 S. Ct. at 1293),
and “describing the claims at... a high level of abstraction and untethered
from the language of the claims all but ensures that the exceptions to § 101
swallow the rule.” Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1337
(Fed. Cir. 2016). Instead, “the claims are considered in their entirety to
ascertain whether their character as a whole is directed to excluded subject
matter.” Internet Patents Corp. v. Active Network, Inc., 790 F.3d 1343,
1346 (Fed. Cir. 2015).
The Examiner concludes the independent claims are directed to
the basic concept of a using categories to organize, store, and
transmit data, a mathematical procedure for converting one
form of numerical representation to another, comparing new
and stored information and using rules to identify options
and/or insurance and billing which are fundamental economic
practices all of which have been found by the courts to be an
abstract idea. The dependent claims and other claim sets contain
additional functional limits directed toward their functional
objectives but do not render the concepts in the identified
judicial exception any less abstract.
Final Act. 5.
Appellants contend that because the Examiner indicated at least some
of the dependent claims contain allowable subject matter under 35 U.S.C.
§§102 and 103, “[tjheir rejection was clear error under the Bilski[1] pre­
cursor to Alice 35USC§101 case analysis, which requires findings that the
method and product be heretofore available to the general public and under
the Buysafe, Inc. vs. Google, Inc. case, 765 F.3d 1350 (Sept. 3, 2014).” App.
Br. 5. According to Appellants, the Examiner’s finding that the claims are
directed to fundamental economic practices (Final Act. 5) is deficient for a
1 Bilski v. Kappos, 561 U.S. 593 (2010).
6
Appeal 2016-005980
Application 11/274,875
failure to show the claimed methodology “to produce renters legal liability
[was] known or in use for a long period of time prior to the invention, and
that it was widely used.'” App. Br. 6. The Examiner responds “the addition
of abstract claim limits, even if novel, to an abstract idea (a fundamental
economic practice) does not make the abstract idea any less abstract and
therefore, are still rendered patent ineligible.” Ans. 4.
We agree with the Examiner that Appellants’ argument is
unpersuasive. A conclusion that an invention is directed to an abstract idea
does not require that the invention is well-known or has been used
extensively. See Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 714—15
(Fed. Cir. 2014) (concluding “showing an advertisement before delivering
free content” is an abstract idea as a method of organizing human activity
rather than an economic practice or financial method as argued). Instead,
“any novelty in implementation of the idea is a factor to be considered only
in the second step of the Alice analysis.” Ultramercial, 772 F.3d at 715.
Furthermore, we disagree the invention is not directed to a
fundamental economic practice which has been well-known and used
extensively. As the Examiner determined, “the claims are directed toward a
contractual relationship (insurance) which is a fundamental economic
practice similar to those found by the courts have found to be an abstract
idea.” Ans. 4. The Court in Alice found that it need not labor to delimit the
precise contours of the “abstract ideas” category in that case. See Alice, 134
S. Ct. at 2357. By Appellants’ own admission the claims “are directed to
producing a new renters legal liability insurance product.” Appeal Br. 6.
Appellants’ disclosure also makes clear the goal of the invention is “to
gather, prepare, and maintain sufficient tenant insurance data to enable
7
Appeal 2016-005980
Application 11/274,875
insurance coverage to be written to cover both the tenant and the building
owner from unintentional tenant acts causing fire, smoke, explosion, and
water damage.” Spec. p. 6,11. 2—5. Whether the claims relate to
guaranteeing sufficient insurance coverage is written, we agree with the
Examiner that the claims are directed to the abstract idea of providing
insurance policies and benefits, both a method of organizing human activity
and a fundamental economic practice. See Bancorp Servs. L.L.C. v. Sun Life
Assur. Co. of Canada (U.S.), 687 F.3d 1266, 1278 (Fed. Cir. 2012)
(concluding managing an insurance policy was an abstract idea); Accenture
Glob. Servs., GmbHv. Guidewire Software, Inc., 728 F.3d 1336, 1341—45
(concluding the claims were directed to the abstract idea of handling
insurance-related information).
Appellants further allege error for failure to provide a chart
“comparing every limitation of the Claims, excluding technological
limitations” as a district court required in Walker Digital LLC v. Google,
Inc., 66 F. Supp. 3d 501 (D. Del. 2014). App. Br. 6. We find this
contention unpersuasive because, as explained by the Examiner, we are not
bound by that decision. See Ans. 5. Furthermore, we are unaware of any
requirement applicable to the subject rejection that would have an Examiner
provide such a chart.
We are also not persuaded of error by Appellants’ contention the
Examiner improperly relies on the decision in Buysafe in finding the instant
claims are directed to an abstract idea. App. Br. 8. Appellants argue the
Court in Buysafe found the underlying method to be an old and well known
performance guarantee in contrast to the instant claims directed to “[rjenter’s
legal liability and tenant occupancy insurance [which] were not previously
8
Appeal 2016-005980
Application 11/274,875
known.” Id. As explained above, “[t]he ‘novelty’ of any element or steps in
a process, or even of the process itself, is of no relevance in determining
whether the subject matter of a claim falls within the § 101 categories of
possibly patentable subject matter.” Diamond v. Diehr, 450 U.S. 175, 188—
89 (1981).
Appellants’ contention “that the present claims do not preempt all
possible uses of the alleged abstract idea or tie up the use of a mathematical
relationship” (App. Br. 11) is also unpersuasive for the reasons articulated
by the Examiner. Ans. 7—8. Although preemption “‘might tend to impede
innovation more than it would tend to promote it, ’ thereby thwarting the
primary object of the patent laws” {Alice, 134 S. Ct. at 2354 (citing Mayo,
132 S. Ct. at 1293)), “the absence of complete preemption does not
demonstrate patent eligibility.” Ariosa Diagnostics, Inc. v. Sequenom, Inc.,
788 F.3d 1371, 1379 (Fed. Cir. 2015); see also OIP Techs., Inc. v.
Amazon.com, Inc., 788 F.3d 1359, 1362—63 (Fed. Cir. 2015) (“[Tjhatthe
claims do not preempt all price optimization or may be limited to price
optimization in the e-commerce setting do not make them any less
abstract.”).
We are also not persuaded by Appellants’ argument “the previous
primary insurance reference, Joao [U.S. 6,347,302], was cited by the
Examiner as a valid insurance method patent reference and not an abstract
idea.” App. Br. 11—12. The Examiner’s citation to Joao was limited to the
subject matter disclosed and taught by the reference in rejecting the claims
under 35 U.S.C. § 103(a). Final Rejection mailed May 21, 2014 at page 2.
Appellants neither identify that the issue of whether the Joao claims were
directed to an abstract idea was addressed nor explain why any result is
9
Appeal 2016-005980
Application 11/274,875
applicable to the instant claims. Furthermore, the Joao patent issued in
2002, a decade prior to issuance of the decision in Mayo and twelve years
prior to the Supreme Court’s decision in Alice. Still further, even if relevant
to the present inquiry under Step 1 of the Alice!Mayo test, Appellants fail to
explain why any resultant finding or conclusion would be binding precedent
on this Board.
For the reasons discussed above, we are unpersuaded the Examiner
erred in concluding, under Step 1 of the Alice!Mayo test, independent claims
1, 12, and 33 are directed to a patent-ineligible concept, i.e., the abstract idea
of creating a contractual relationship (insurance) as a fundamental economic
practice. See Ans. 4.
Step Two — Whether the Claims Amount to Significantly More
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.” Alice, 134 S. Ct. at 2355 (quoting Mayo, 132 S. Ct. at 1297).
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).
The Examiner determines that
[t]he claim[s] do not include additional elements that are
sufficient to amount to significantly more than the judicial
exception. The claims require the additional limitations of a
computer with a processor and a tangible, non-transitory
memory. These generic computer components are claimed to
perform their basic functions of storing, retrieving, processing,
and displaying data [through] the program that enables the
10
Appeal 2016-005980
Application 11/274,875
execution of the abstract idea(s). The recitation of the computer
limitations amounts to mere instruction to implement the abstract
idea on a computer. Therefore, when considered separately and
in combination, the computer components at each step of the
process perform purely generic computer functions. As such,
there is no inventive concept sufficient to transform the claimed
subject matter into a patent-eligible application. The claims do
not amount to significantly more than the abstract idea itself and
are, therefore, not patent eligible.
Final Act. 5.
Appellants contend
the claims are directed to an interactive renter[’]s legal liability
insurance computer method and apparatus for insuring large
apartments and multi-units dwellings with many units, written on
a group rate basis, which can only be addressed with large
number statistics and cannot be manually implemented by
humans in a timely manner.
App. Br. 13. Appellants argue the claims “provide a novel, specialized
computer generated replacement cost renters legal liability insurance
coverage.” App. Br. 18.
We are not persuaded of error for the reasons discussed by the
Examiner. Ans. 8—10. The Specification discloses the computer processor
may be “personal computer 10” as depicted in Figure 3 of the drawings.
Spec. 16,11. 12—13. Thus, many general purpose processors or computers
available at the time the application was filed could have been used to
perform the claimed steps. Simply using a computer to do what a person
could do manually does not add significantly more to the abstract idea. See
Bancorp Servs., 687 F.3d at 1279 (“[T]he computer simply performs more
efficiently what could otherwise be accomplished manually.”); Alice, 134 S.
Ct. at 2357—58 (holding the introduction of a computer or processor to
11
Appeal 2016-005980
Application 11/274,875
implement an abstract idea is not a patentable application of the abstract
idea). Although the claimed subject matter invokes the use of a computer
system, the functions performed by the computer system in carrying out the
recited steps are conventional, well-understood, and do not go beyond those
of a general purpose computer. Therefore, the claimed subject matter
merely recites the performance of a business practice known from the pre-
Internet era, and it is not necessarily rooted in computer technology. See
OIP Techs., 788 F.3d at 1362 (concluding a “[mjethod of pricing a product
for sale” and “apparatus for use in electronic commerce” relate to the
concept of “offer based pricing” similar to other fundamental economic
concepts found to be abstract ideas). Thus, we agree with the Examiner that
the elements of the independent claims do not amount to “significantly
more” than the abstract idea of using conventional elements (e.g., a general
purpose computer system) to insure an apartment or multi-unit dwelling with
renters legal liability insurance. Therefore, these elements not add any
meaningful limitations beyond generally linking the abstract idea to the
particular technological environment. OIP Techs., 788 F.3d at 1362.2
2 Considerations for determining whether a claim with additional elements
amounts to “significantly more” than the judicial exception itself include
improvements to another technology or technical field {Alice, 134 S. Ct. at
2359 (citing Diamond, 450 U.S. at 177—78)); adding a specific limitation
other than what is well-understood, routine, and conventional in the field, or
adding unconventional steps that confine the claim to a particular useful
application {Mayo, 132 S. Ct. at 1299, 1302); or other meaningful limitations
beyond generally linking the use of the judicial exception to a particular
technological environment {Alice, 134 S. Ct. at 2360). See, e.g., Intellectual
Ventures ILLC v. Capital One Bank (USA), 792 F.3d 1363, 1370 (Fed. Cir.
2015) (“[Mjerely adding computer functionality to increase the speed or
efficiency of the process does not confer patent eligibility on an otherwise
abstract idea.”).
12
Appeal 2016-005980
Application 11/274,875
We are also unpersuaded that claims directed to novel and non­
ob vious subject matter necessarily entail an inventive concept that
transforms the claims to significantly more than the abstract idea. See, e.g.,
App. Br. 5—6. Although the second step in the Alice!Mayo framework is
termed a search for an “inventive concept,” the analysis is not an evaluation
of novelty or non-obviousness, but rather a search for “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.” Alice, 134 S. Ct. at 2355. A novel and non-obvious claim directed to
a purely abstract idea is, nonetheless, patent-ineligible. See Mayo, 132 S. Ct.
at 1304.
We are also unpersuaded by Appellants’ contention the Examiner
failed to address Step 2 of the Mayo/Alice test. Reply Br. 6—12. According
to Appellants, “[n]o analysis was made as to whether that the abstract idea is
transformed by additional recited elements into a patent-eligible invention
not previously known in the insurance art and thus incapable of pre-empting
future use.” Reply Br. 7. We disagree. The Examiner addresses Step 2 at
pages 5—9 of the Final Action and at pages 8—9 of the Answer.
For the reasons discussed above, we conclude independent method
claim 1 does not amount to significantly more than an abstract idea, and is
not patent eligible. The same reasoning applies to independent method
claim 12 “using a computer processor” and independent apparatus claim 33.
In connection with the remaining claims the Examiner concludes
the dependent claims and other claim sets contain additional
functional limits directed toward their functional objectives but
do not render the concepts in the identified judicial exception any
less abstract. . . [and] do not include additional elements that are
13
Appeal 2016-005980
Application 11/274,875
sufficient to amount to significantly more than the judicial
exception.
Final Act. 5; see also Ans. 9. We have reviewed dependent claims 2—11,
13—32, 34—39, 42, and 43, together with Appellants’ corresponding
contentions of error (see App. Br. 14—18; Reply Br. 8—13), and agree these
dependent claims are also directed to an abstract idea and do not add
anything materially more patent-eligible than the abstract concepts recited in
the independent claims.
For the foregoing reasons, we sustain the Examiner’s rejection of
claims 1—39, 42, and 43 under the judicial exception under 35 U.S.C. § 101.
DECISION
We affirm the Examiner’s rejection of claims 1—39, 42, and 43 under
35 U.S.C. § 101.
No time period for taking any subsequent action in connection with
this appeal may be extended under 37 C.F.R. § 1.136(a)(l)(iv). See 37
C.F.R. § 41.50(f).
AFFIRMED
14