Ex Parte Wronski

Board of Patent Appeals and Interferences

Apr 30, 2008

09995218 (B.P.A.I. Apr. 30, 2008)

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____________________

BEFORE THE BOARD OF PATENT APPEALS
AND INTERFERENCES
____________________

Ex parte JOHN S. WRONSKI, Jr.
____________________

Appeal 2008-0349
Application 09/995,218
Technology Center 3600
____________________

Decided: April 30, 2008
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Before WILLIAM F. PATE, III, ANTON W. FETTING and STEVEN D.A.
McCARTHY, Administrative Patent Judges.

PATE, III, Administrative Patent Judge.

DECISION ON APPEAL

STATEMENT OF CASE
The Appellant appeals under 35 U.S.C. § 134 (2002) from a Final
Rejection of claims 1-24. We have jurisdiction under 35 U.S.C. § 6(b)
(2002).
The Appellant claims a system and method for authorizing purchases
to reduce fraudulent transactions by having the account owner provide to the
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bank various authorization parameters (such as merchant category, product
category, expected time of transaction, etc.) regarding an anticipated
purchase. The bank calculates an authorization code based on the selected
parameters and provides it to the account owner. During the actual purchase
transaction, the merchant provides the account information and the customer
supplied authorization code to the bank. The bank calculates a confirmation
authorization code and compares the calculated confirmation authorization
code to the transmitted authorization code to determine whether the
transaction should be authorized.
Independent claims 1 and 16 read as follows:
1. A method for authorizing purchases by an owner of an
account previously established with a bank, the owner wanting
to purchase an item from a merchant, the method comprising
the step(s) of:
providing a plurality of authorization parameters
available for use in calculating an authorization code associated
with a transaction to purchase the item;
defining a selected subset of the plurality of authorization
parameters;
establishing respective authorization parameter data for
each of the selected authorization parameters;
calculating the authorization code corresponding to the
established respective authorization parameter data;
providing the authorization code to the owner;
providing the authorization code to the merchant;
receiving the authorization code and transaction data
from the merchant at the bank;
calculating a confirmation authorization code from the
transaction data corresponding to the established respective
authorization parameter data; and
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comparing the authorization code with the confirmation
authorization code to determine whether or not to approve the
transaction.

16. A database for processing a transaction, the database
comprising:
a plurality of owner account information files;
a plurality of authorization parameters available for use
in calculating an authorization code associated with a
transaction to purchase an item; and
a plurality of transaction authentication records
corresponding to the plurality of owner account information
files, respectively; and
where each transaction record is representative of a
respective transaction and has associated therewith a selected
subset of the plurality of authorization parameters, respectively
and an authorization code corresponding to the selected
respective authorization parameter data, respectively.

Independent claim 8 recites a method of operating a transaction
processing data center for authorizing purchases including the step of
calculating the authorization code corresponding to the received respective
authorization parameter data. Independent claim 18 recites a system for
authorizing purchases including a means for calculating the authorization
code corresponding to the established respective authorization parameter
data.
The prior art relied upon by the Examiner in rejecting the claims is:
Langhans 5,500,513 Mar. 19, 1996
Gephart 6,339,766 Jan. 15, 2002

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The Examiner rejected claims 1-24 under 35 U.S.C. § 103(a) as
unpatentable over Langhans in view of Gephart.
We AFFIRM-IN-PART.

ISSUE
The sole issue raised in the present appeal is whether the Appellant
has shown that the Examiner erred in rejecting claims 1-24 as unpatentable
over Langhans in view of Gephart.

PRINCIPLES OF LAW
“Section 103 forbids issuance of a patent when ‘the differences
between the subject matter sought to be patented and the prior art are such
that the subject matter as a whole would have been obvious at the time the
invention was made to a person having ordinary skill in the art to which said
subject matter pertains.’” KSR Int'l Co. v. Teleflex Inc., 127 S.Ct. 1727,
1734 (2007). The question of obviousness is resolved on the basis of
underlying factual determinations including (1) the scope and content of the
prior art, (2) any differences between the claimed subject matter and the
prior art, (3) the level of skill in the art, and (4) where in evidence, so-called
secondary considerations. Graham v. John Deere Co., 383 U.S. 1, 17-18
(1966). The Court noted that “[t]o facilitate review, this analysis should be
made explicit.” KSR Int'l Co. v. Teleflex Inc., 127 S.Ct. at 1741, citing In re
Kahn, 441 F.3d 977, 988 (Fed. Cir. 2006) (“[R]ejections on obviousness
grounds cannot be sustained by mere conclusory statements; instead, there
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must be some articulated reasoning with some rational underpinning to
support the legal conclusion of obviousness”). However, “the analysis need
not seek out precise teachings directed to the specific subject matter of the
challenged claim.” Id.

ANALYSIS
The Examiner rejected the claims as unpatentable over Langhans and
Gephart (Ans. 3). The Examiner asserts that Langhans discloses all of the
recited limitations of the rejected claims except that the account disclosed in
Langhans is a corporate account instead of an individual account (Ans. 3 and
4). The Examiner cites Gephart for disclosing a limited use account system
for an individual account and states that because both Langhans and Gephart
provide fraud protection by limiting account use and/or activity based on
various criteria, the pending claims are obvious and unpatentable (Ans. 4
and 6).
In the Appeal Brief, the Appellant submits arguments directed to all of
the rejected claims, as well as specific arguments directed to various
individual claims. With respect to all of the rejected claims, the Appellant
argues that because in the present invention, the card owner interacts with a
bank/credit card agency to obtain an authorization code specific to the
anticipated purchase in advance of the purchase, the authorization code is
transaction specific and different for each transaction (App. Br. 11 and 12;
Reply Br. 3 and 4). The Appellant contends that Langhans merely discloses
a unique card number that is permanently encoded on the card and that
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Langhans does not disclose a system that generates an authorization code
that is specific to a transaction (App. Br. 13 and 14). The Appellant further
contends that Gephart does not correct this deficiency of Langhans (App. Br.
15; Reply Br. 2). Although not explicitly stated, the underlying basis of the
Appellant’s argument is that because the authentication codes are calculated
corresponding to the authorization parameter data for each transaction, the
resultant calculated authentication codes are different for each transaction
(Reply Br. 3 and 4).
The Examiner maintains that the claims do not recite that the
authorization code is different for each transaction and states that the
Appellant is reading limitations into the claims (Ans. 7). While we agree
with the Examiner that the claims do not explicitly recite that the
authorization code is different for each transaction, we also find that the
Examiner’s rejection of independent claims 1, 8 and 18 is deficient because
the cited prior art reference does not disclose or suggest “calculating the
authorization code” as recited in these claims (Reply Br. 4).
In this regard, we note that the Specification clearly teaches
calculating an authorization code that is representative of the various
selected authorization parameter data, but is not readily derivable by an
outsider (Spec. 7 and 8). The Specification further describes an embodiment
that utilizes an encryption algorithm and a key in conjunction with the
selected authorization parameter data to calculate the authorization code
(Spec. 7-9; Fig. 2A). Thus, we construe the limitation “calculating the
authorization code” in claim 1 to require a step in which the resultant
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authorization code is unique to a transaction and includes information about
the authorization parameter data. A series of numbers that merely identify
the transaction or the account does not satisfy this limitation. Thus,
Langhans does not disclose or suggest the recited calculation step, and the
Examiner has not articulated any reason with a rational basis as to why
calculation of an authorization code would have been obvious to one of
ordinary skill in the art. Gephart, as applied by the Examiner, does not
remedy this deficiency.
Therefore, in view of the above, the Appellant has shown that the
Examiner erred in rejecting claims 1-15 and 18-24 as unpatentable over
Langhans in view of Gephart. The Appellant’s specific arguments regarding
dependent claims 2-7, 9-15 and 19-24 ultimately depending from claims 1, 8
or 18 are noted, but are moot in view of the above (Ans. 16-18).
With respect to independent claim 16, we note that there is no specific
recitation of calculating the authorization code in this claim. Claim 16 does
recite “a plurality of authorization parameters available for use in calculating
an authorization code associated with a transaction to purchase an item.”
However, the recitation of “calculating an authorization code” in this
limitation is merely a statement of intended use. All that is required to
satisfy this limitation is for the authorization parameters to be available for
use, not that these parameters be actually used in calculating an
authorization code. The various usage restrictions of Langhans or Gephart
satisfy this limitation in that such usage restrictions are also available for the
recited use. In addition, while claim 16 also recites that each transaction
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record has associated therewith, “an authorization code corresponding to the
selected respective authorization parameter data,” this limitation is satisfied
by the prior art in that account or transaction numbers also correspond to the
authorization parameter data by identifying the account or transaction to
which the parameter data is associated. Thus, the Appellant has not shown
that the Examiner erred in rejecting independent claim 16.
Finally, claim 17 depending from claim 16 further recites that the
plurality of authorization parameters includes a transaction sequence
parameter. We agree with the Appellant that the cited prior art references do
not disclose such a feature and that the Examiner has not articulated any
reason as to why provision of the recited feature would have been obvious
(App. Br. 18). Therefore, the Appellant has shown that the Examiner erred
in rejecting dependent claim 17.

CONCLUSIONS
1. The Appellant has shown that the Examiner erred in rejecting
claims 1-15 and 18-24 as unpatentable over Langhans and Gephart.
2. The Appellant has not shown that the Examiner erred in
rejecting independent claim 16 as unpatentable over Langhans and Gephart.
3. The Appellant has shown that the Examiner erred in rejecting
dependent claim 17 as unpatentable over Langhans and Gephart.

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ORDER
1. The Examiner’s rejection of claim 1-15 and 17-24 is
REVERSED.
2. The Examiner’s rejection of claim 16 is AFFIRMED.
No time period for taking any subsequent action in connection with
this appeal may be extended under 37 C.F.R. § 1.136(a). See 37 C.F.R.
§ 1.136(a)(1)(iv) (2007).

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AFFIRMED-IN-PART

JRG

PITNEY BOWES INC.
35 WATERVIEW DRIVE
P.O. BOX 3000
MSC 26-22
SHELTON, CT 06484-8000
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