Ex Parte Understein

Patent Trial and Appeal Board

Apr 13, 2016

13860821 (P.T.A.B. Apr. 13, 2016)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE
13/860,821 04/11/2013
23117 7590 04/15/2016
NIXON & V ANDERHYE, PC
901 NORTH GLEBE ROAD, 11 TH FLOOR
ARLINGTON, VA 22203
FIRST NAMED INVENTOR
Norman Understein
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.
AMK-2802-52 6666
EXAMINER
ROBINSON, KITO R
ART UNIT PAPER NUMBER
3695
NOTIFICATION DATE DELIVERY MODE
04/15/2016 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):
PTOMAIL@nixonvan.com
pair_nixon@firsttofile.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte NORMAN UNDERSTEIN
Appeal2016-002547
Application 13/860,821 1
Technology Center 3600
Before HUBERT C. LORIN, PHILIP J. HOFFMANN, and
BRUCE T. WIEDER, Administrative Patent Judges.
WIEDER, Administrative Patent Judge.
DECISION ON APPEAL
This is a decision on appeal under 35 U.S.C. § 134 from the
Examiner's rejection of claims 1-21. We have jurisdiction under
35 U.S.C. § 6(b).
We AFFIRM.
CLAIMED SUBJECT MATTER
Appellant's claimed "invention relates to systems and methods for
processing a real estate settlement using dedicated deposit accounts." (Spec.
ii 3.)
1 According to Appellants, the real party in interest is eDeposit Corporation.
(Appeal Br. 3.)
Appeal2016-002547
Application 13/860,821
Claims 1, 5, 11, 18, and 19 are the independent claims on appeal.
Claim 1 is representative and reproduced below (emphasis added):
1. A method for processing a real estate settlement using a
computer system including a processor programmed to carry out
steps of the method and a communication network interface, the
method comprising:
(a) a settlement manager providing estimates for funds
required from at least one of a buyer and a seller based on terms
of the real estate settlement, wherein the settlement manager is
neither the buyer nor the seller;
(b) the settlement manager communicating hold requests
to the at least one of the buyer and the seller, wherein the buyer
and the seller have access to respective deposit accounts;
( c) the computer system enabling the at least one of the
buyer and the seller to hold funds in the respective deposit
accounts based on the estimates provided by the settlement
manager, the computer system transforming the funds from
available funds to held funds, wherein the held funds remain in
the respective deposit accounts and show as deposits in the
respective deposit accounts as a hold on behalf of the settlement
manager but are otherwise unavailable to the buyer and the seller;
( d) the settlement manager determining final settlement
amounts for the at least one of the buyer and the seller, and the
settlement manager initiating multiple transactions to transfer the
final settlement amounts to a corresponding multiple parties
according to parameters of the real estate settlement; and
( e) after step ( d), when the final settlement amounts are
less than the funds held in step ( c ), the computer system releasing
any remaining held funds in the respective deposit accounts by
re-transforming the remaining held funds to available funds.
REJECTIONS
Claims 1-21 are rejected under 35 U.S.C. § 101 as being directed to
non-statutory subject matter.
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Application 13/860,821
Claims 1---6 and 9-21 are rejected under 35 U.S.C. § 103(a) as being
unpatentable over Hall (US 7,596,511 B2, iss. Sept. 29, 2009) and Lee
(US 2003/0200118 Al, pub. Oct. 23, 2003).
Claims 7 and 8 are rejected under 35 U.S.C. § 103(a) as being
unpatentable over Hall, Lee, and Understein (US 7,844,537 B2,
iss. Nov. 30, 2010).
ANALYSIS
The § 101 Rejection
Claims 1-21 are rejected under§ 101. The Examiner determines that
the claims are
directed to processing real estate settlement transactions which is
considered to be an abstract idea inasmuch as such activity is
considered both a fundamental economic practice and a method
of organizing human activity by providing an opportunity for
parties to enter into a specified agreement.
The elements of the process are: providing a settlement
manager that estimates funds; communicating a hold request,
holding the funds, determining final settlement amounts and
releasing any remaining funds in the account if settlement is less
than the held funds.
The elements of the instant process, when taken alone,
each execute in a manner routinely and conventionally expected
of these elements. The elements of the instant process, when
taken in combination, together do not offer substantially more
than the sum of the functions of the elements when each is taken
alone.
(Final Action 5.) Additionally, the Examiner determines that "[t]he claims
relate to the concept of intermediated settlement which is a fundamental
economic practice long prevalent in our system of commerce which is in the
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Application 13/860,821
realm of abstract ideas identified by the Supreme Court." (Id. at 2; see Alice
Corp. Pty Ltd. v. CLS Bank Int'!, 134 S. Ct. 2347 (2014).)
Appellant disagrees and argues that the claimed invention is "entirely
different from intermediated settlement as discussed in Alice." (Appeal
Br. 15.) Specifically, Appellant argues that Alice relates to "a kind of
electronic escrow where a third party holds 'real' money while 'shadow'
balances are shown to both sides during trading." (Id. at 16.) The claimed
invention, appellant argues, "utilizes novel computerized processes to
eliminate the third party." (Id.)
Claim 1 relates to holding funds sufficient to cover fees and a
settlement manager initiating transactions to move the funds to and from
accounts of the appropriate parties. In short, claim 1 closely parallels the
intermediated settlement in Alice. In this case, the deposit accounts hold the
funds until the settlement manager (acting like an intermediary) initiates the
transactions to move the funds. Therefore, we agree with the Examiner that
claim 1 is directed to an abstract idea.
We next address whether "the elements of the claim ... contain[] an
'inventive concept' sufficient to 'transform' the claimed abstract idea into a
patent-eligible application." See Alice, 134 S. Ct. at 2357 (citing Mayo, 132
S. Ct. at 1294, 1298).
The Examiner determines that the settlement manager "simply
perform[ s] the generic computer functions of receiving, processing and
transmitting information" and that these "are well-understood, routine and
conventional limitations that amount to mere instructions to implement the
abstract idea." (Answer 4.) Specifically, the Examiner determines that
"courts have recognized ... receiving, processing, and storing data, [and]
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Application 13/860,821
electronic recordkeeping" as "well-understood, routine, and conventional"
computer functions. (Id.) In short, "[g]eneric computers performing generic
computer functions, alone, do not amount to significantly more than the
abstract idea." (Id.)
Appellant disagrees and, in arguing the "tremendous advantage"
associated with the invention, argues that "[t]he claimed process could not
be completed by hand, but rather requires a computer system so that
transaction participants can effect fund holds that are subsequently
accessible by a settlement manager." (Appeal Br. 17.) We are not
persuaded that the process could not be completed by hand. The
Specification recites that "[i]t would be desirable if the funds from each
party needed to provide them were 'on hold' with a dedicated but personal
account ... , and that each recipient of funds opened a registered account to
receive the funds." (Spec. i-f 9.) In other words, buyer and seller may each
set up an account. Another person, i.e., a settlement manager, may then take
control of the accounts to hold and distribute funds as appropriate.
Appellant further argues that "the computer system [of claim 1]
utilizes the Internet to eliminate a third party in a conventional escrow
context." (Appeal Br. 17.) Again, we disagree. Nothing in claim 1 requires
the computer system to be connected to the Internet. For example, the
settlement manager may be within a bank and the buyer and seller accounts
also within the bank. Thus, the computer system could simply be an internal
bank system performing the generic functions of such a computer system,
i.e., holding and moving funds.
Considered as an ordered combination, the steps of Appellant's
method add nothing that is not already present when the steps are considered
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Application 13/860,821
separately. Viewed as a whole, claim 1 simply recites the concept of
"providing a settlement manager that estimates funds; communicating a hold
request, holding the funds, determining final settlement amounts and
releasing any remaining funds in the account if settlement is less than the
held funds." (See Final Action 5.) The method claim does not, for example,
purport to improve the functioning of the computer system itself. Nor does
it effect an improvement in any other technology or technical field. Instead,
the claim amounts to nothing significantly more than an instruction to apply
the abstract idea. That is not enough to transform an abstract idea into a
patent-eligible invention. See Alice 134 S. Ct. at 2360.
Therefore, we are not persuaded that the Examiner erred in rejecting
claim 1 under § 101. Because claims 1-21 are argued together with regard
to§ 101 (Appeal Br. 15-19), claims 2-21 fall with claim 1. See 37 C.F.R.
§ 41.37(c)(l)(iv).
The§ 103 Rejection
The Examiner relies on Lee for the disclosure of "a settlement
manager communicating hold requests." (Final Action 7.) Appellant
disagrees. (Appeal Br. 19.)
Lee discloses a system for payment of medical claims:
A system allows a health care provider to arrange payment
at the time of service for a patient responsibility portion of a
health care claim amount, even though the provider may not
know what the patient responsibility portion will be until after
adjudication. A health care debit card is associated with an
account of the patient. At the time of service, the patient presents
the card to the provider. The provider uses the card to authorize
the system to hold an estimate of the patient responsibility
amount in suspense in the patient's account. After adjudication,
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Application 13/860,821
when the actual patient responsibility amount is known, a
transaction set is sent to the system. The system then
automatically transfers the actual patient responsibility amount
from the patent's account and into the provider's bank account.
Any remainder of the suspended funds is left in the patient's
account.
(Lee, Abstract.)
The Examiner determines that "Appellant's claim limitation discloses
the settlement manager communicating hold requests to the at least one of
the buyer and the seller, where the buyer and the seller have access to
respective deposit accounts. In other words, either the buyer or seller has a
hold request on their account." (Answer 5.)
Appellant replies that "[ t ]he method step requires the settlement
manager to communicate a hold request" to the buyer and/or seller. (Reply
Br. 3.)
While Lee discloses that a hold request is placed on an account, the
Examiner points to nothing in Lee disclosing that the hold request is
communicated to the buyer and/or seller as opposed to simply being placed
on the account. Also, the Examiner does not indicate that such a
communication would have been obvious to one of ordinary skill in the art at
the time. For these reasons, we are persuaded that the Examiner erred in
rejecting claim 1 and dependent claims 2--4, 7-10, and 21 under§ 103.
Independent claims 5, 11, and 19 contain similar language and, therefore, we
are also persuaded that the Examiner erred in rejecting those claims and
dependent claims 6, 12-17, and 20, which depend respectively from claims
5, 11, and 19, under§ 103.
Independent claim 18 does not contain the "communicating"
limitation of independent claims 1, 5, 11, and 19. However, claim 18 recites
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"wherein enabling the at least one of the buyer and the seller to hold funds
comprises holding funds in amounts that exceed the estimates by a
predetermined amount." Independent claim 5 contains similar language.
Appellant argues that the Examiner
contends that Lee discloses this subject matter, again referring to
the Abstract, paragraph [0005] and claim 1. In no instance,
however, does Lee reference securing funds in amounts that
exceed an estimate by any such predetermined amount. Lee
rather merely describes that the provider supplies an estimate of
the patient responsibility amount to the system, and the patient's
healthcare debit card is used to authorize the system to hold the
estimated amount in suspense in the designated account of the
patient.
(Appeal Br. 21.)
We agree with Appellant that the portions of Lee cited by the
Examiner (see Final Action 8) do not disclose "holding funds in amounts
that exceed the estimates by a predetermined amount." Also, the Examiner
does not indicate that holding such excess funds \'l/ould have been obvious to
one of ordinary skill in the art at the time. For these reasons, we are
persuaded that the Examiner erred in rejecting claim 18 under § 103 and
additionally persuaded that the Examiner erred in rejecting independent
claim 5 and dependent claim 6 under § 103.
Appellant's other arguments have been considered but are not deemed
persuasive of error.
DECISION
The Examiner's rejection of claims 1-21under35 U.S.C. § 101 is
affirmed.
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Application 13/860,821
The Examiner's rejections of claims 1-21under35 U.S.C. § 103(a)
are 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)(l )(iv).
AFFIRMED
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