International Business Machines Corporation

Patent Trials and Appeals Board

Aug 4, 2020

2020001495 (P.T.A.B. Aug. 4, 2020)

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.
14/870,518 09/30/2015 Shang Qing Guo YOR920100149US2 9941
48062 7590 08/04/2020
RYAN, MASON & LEWIS, LLP
2425 Post Road
Suite 204
Southport, CT 06890
EXAMINER
VIG, NARESH
ART UNIT PAPER NUMBER
3622
NOTIFICATION DATE DELIVERY MODE
08/04/2020 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):
ctoffice@rml-law.com
kmm@rml-law.com
mjc@rml-law.com
PTOL-90A (Rev. 04/07)

UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________

Ex parte SHANG QING GUO, JEFFREY OWEN KEPHART,
and JONATHAN LENCHNER

Appeal 2020-001495
Application 14/870,518
Technology Center 3600
____________

Before MICHAEL J. STRAUSS, BARBARA A. BENOIT,
and MICHAEL M. BARRY, Administrative Patent Judges.

BARRY, Administrative Patent Judge.

DECISION ON APPEAL

Pursuant to 35 U.S.C. § 134(a), Appellant1 appeals from the
Examiner’s decision to reject claims 1, 3, 5–14, 16, and 18–29, which are all
the pending claims. See Final Act. 1; Appeal. Br. 8–25. We have jurisdiction
under 35 U.S.C. § 6(b).
We REVERSE.
Introduction

1 We use “Appellant” to refer to the “applicant” as defined in 37 C.F.R.
§ 1.42. Appellant identifies the real party in interest as International
Business Machines Corporation. Appeal Br. 1.
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Appellant describes the invention as relating particularly to “dynamic
placement, management and monitoring of web-based advertising.” Spec.
1:11–12. In discussing the technology background to the invention, the
Specification identifies needs faced by Internet content providers, content
aggregators, and advertisers arising from the nature of Internet/web traffic
and from the diffuse spread of content over the Internet. Spec. 1:15–31.
Claim 1 is illustrative of the claims on appeal:
1. A method performed by a provider of Internet
content for distributing the Internet content, comprising:
embedding, using at least one processing device, an
advertisement placeholder in the Internet content, wherein said
advertisement placeholder is a placeholder for a distinct
advertisement and comprises an identifier of said provider of
the Internet content, a provider of an aggregator web site and
one or more policies specifying one or more content constraints
specified by one or more of the provider of Internet content, at
least one advertiser and the aggregator web site; and
providing, using the at least one processing device, the
Internet content to said aggregator web site, wherein the
aggregator web site presents the Internet content to at least one
end user with at least one advertisement in the advertisement
placeholder, wherein the at least one advertisement in the
advertisement placeholder is selected by dynamically matching
the Internet content to one or more targeting criteria of the at
least one advertiser such that the one or more content
constraints specified in said advertisement placeholder are
satisfied, and
wherein a server:
obtains, using the at least one processing device, said
identifier from said advertisement placeholder of said provider
of the Internet content and said provider of the aggregator web
site;
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obtains, using the at least one processing device, a
specification of terms from at least one record in at least one
memory using said identifier from at least one of said provider
of the Internet content, said provider of the aggregator web site
and said at least one advertiser; and
processes, using the at least one processing device, the
advertisement placeholder to automatically share revenue from
the at least one advertisement with the provider of the Internet
content and a provider of the aggregator web site, wherein said
revenue sharing is based on said specification of terms.
Claims App’x 2.2
The Rejections
The Examiner rejected claims 1, 3, 5–14, 16, and 18–29 under 35
U.S.C. § 101 as being directed to an abstract idea. Final Act. 2–5.
The Examiner rejected claims 1, 3, 5–9, 11–14, 16, and 18–29 under
35 U.S.C. § 103 as obvious over Martinez (US 2008/0082905 A1; Apr. 3,
2008). Final Act. 6–12.
The Examiner rejected claim 10 under § 103 as obvious over Martinez
and Wu (US 2010/0161411 A1; June 24, 2010). Final Act. 13.
The § 101 Rejection
General § 101 Law and the USPTO 2019 Guidance
An invention is patent-eligible if it claims a “new and useful process,
machine, manufacture, or composition of matter.” 35 U.S.C. § 101. The
Supreme Court, however, has long interpreted 35 U.S.C. § 101 to include
implicit exceptions: “[l]aws of nature, natural phenomena, and abstract

2 All references to the Appeal Brief Claims Appendix (“Claims App’x”) are
to the corrected Claims Appendix filed July 24, 2019.
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ideas” are not patentable. Alice Corp. v. CLS Bank Int’l, 573 U.S. 208, 216
(2014).
In determining whether a claim falls within an excluded category, we
are guided by the Supreme Court’s two-step framework, described in Mayo
and Alice. Id. at 217–18 (citing Mayo Collaborative Servs. v. Prometheus
Labs., Inc., 566 U.S. 66, 71–73 (2012)). In accordance with that framework,
we first determine what concept the claim is “directed to.” See Alice, 573
U.S. at 219 (“On their face, the claims before us are drawn to the concept of
intermediated settlement, i.e., the use of a third party to mitigate settlement
risk.”); see also Bilski v. Kappos, 561 U.S. 593, 611 (2010) (“Claims 1 and 4
in petitioners’ application explain the basic concept of hedging, or protecting
against risk.”).
Concepts determined to be abstract ideas, and, thus, patent ineligible,
include certain methods of organizing human activity, such as fundamental
economic practices (Alice, 573 U.S. at 219–20; Bilski, 561 U.S. at 611);
mathematical concepts (Parker v. Flook, 437 U.S. 584, 594–95 (1978)); and
mental processes (Gottschalk v. Benson, 409 U.S. 63, 67 (1972)). In
Diamond v. Diehr, the claim at issue recited a judicial exception in the
category of mathematical concepts, but the Supreme Court held that “[a]
claim drawn to subject matter otherwise statutory does not become
nonstatutory simply because it uses a mathematical formula.” 450 U.S. 175,
176 (1981).
If the claim is “directed to” an abstract idea, we turn to the second
step of the Alice and Mayo framework, where “we must examine the
elements of the claim to determine whether it contains an ‘inventive
concept’ sufficient to ‘transform’ the claimed abstract idea into a patent-
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eligible application.” Alice, 573 U.S. at 221 (internal citation omitted). “A
claim that recites an abstract idea must include ‘additional features’ to
ensure ‘that the [claim] is more than a drafting effort designed to
monopolize the [abstract idea].’” Id. (quoting Mayo, 566 U.S. at 77).
“[M]erely requiring generic computer implementation fails to transform that
abstract idea into a patent-eligible invention.” Id. at 212.
In early 2019, the USPTO published revised guidance on the
application of § 101. 2019 Revised Patent Subject Matter Eligibility
Guidance, 84 Fed. Reg. 50–57 (Jan. 7, 2019) (“Revised Guidance”). Under
the Revised Guidance, we first look to whether the claim recites:
(1) any judicial exceptions, including certain groupings
of abstract ideas (i.e., mathematical concepts, certain methods
of organizing human activity such as a fundamental economic
practice, or mental processes); and
(2) additional elements that integrate the judicial
exception into a practical application (see Manual of Patent
Examining Procedure (MPEP) § 2106.05(a)–(c), (e)–(h)).3
See 84 Fed. Reg. at 52, 54–55. Only if a claim (1) recites a judicial exception
and (2) does not integrate that exception into a practical application, do we
then look to whether the claim:
(3) adds a specific limitation beyond the judicial
exception that are not “well-understood, routine, conventional”
in the field (see MPEP § 2106.05(d)); or
(4) simply appends well-understood, routine,
conventional activities previously known to the industry,
specified at a high level of generality, to the judicial exception.
See Revised Guidance, 84 Fed. Reg. at 56.

3 All references to the MPEP are to Rev. 08.2017 (Jan. 2018).
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Our Analysis
Appellant argues error in the § 101 rejection based solely on the
independent claims (as a group). Appeal Br. 8–17. We select claim 1 as
representative for all claims. 37 C.F.R. § 41.37(c)(1)(iv).
Alice/Mayo Step One, Revised Guidance Step 2A Prong One
For our prong one analysis, we set aside the technological limitations,
e.g., “processing device” and “web site.” Setting those aside, the first step of
claim 1’s “method performed by a provider of Internet content[4] for
distributing the Internet content” recites
embedding . . . an advertisement placeholder in the
Internet content, wherein said advertisement placeholder is a
placeholder for a distinct advertisement and comprises an
identifier of said provider of the Internet content, a provider of
an aggregator web site and [a policy5] specifying [a] content
constraint[] specified by [] the provider of Internet content.
These limitations describe a step for a commercial interaction for
advertising. The 2019 Guidance explains that such limitations recite an
abstract idea in the category of certain methods of organizing human
activity. See 84 Fed. Reg. at 52. All of claim 1’s steps recite an aspect of the
commercial interaction for advertising, in which an aggregator presents
Internet content to an end user along with an ad, and the revenue from that

4 Regardless of technological aspects of “Internet content” and “aggregator
web site,” the recitations of “a provider of Internet content” and “a provider
of an aggregator web site” here are abstract references to entities.
5 To facilitate our analysis under the broadest reasonable interpretation of the
claim limitations, for claim terms that recite alternatives, we consider only
one of the recited alternatives, e.g., here, we substitute “a policy” for “one or
more policies.”
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ad is shared between the providers of the Internet content and the aggregator
web site. For example, the last step recites “shar[ing] revenue from the at
least one advertisement with the provider of the Internet content and a
provider of the aggregator web site, wherein said revenue sharing is based
on said specification of terms.” For the same reason as the first step, these
recited limitations in the remaining steps also are judicial exceptions. Id.
In sum, claim 1 collectively recites a judicial exception of (a)
specifying content constraints to use when selecting ads that an aggregator
presents to a user along with the content, and (b) sharing revenue from
presented ads between the content provider and the aggregator. Because
claim 1 recites a judicial exception, we proceed to prong two.
Alice/Mayo Step One, 2019 Guidance Step 2A Prong Two
We next consider whether claim 1 recites any additional elements that
integrate the recited judicial exception into a practical application. See
Revised Guidance, 84 Fed. Reg. at 54–55. Here, the Examiner identifies the
additional limitations beyond the abstract idea as only a memory and
processing device, and determines their use “to perform the embedding,
selecting, obtaining and sharing steps amounts to no more than mere
instructions to apply the exception using generic computer components.”
Ans. 4.
As Appellant argues, however, and we agree,
the embedding an advertisement placeholder, selecting content,
and obtaining an identifier from the advertisement placeholder
of the Internet content provider and the aggregator web site
provider, as well as a specification of terms using the obtained
identifier; and processing the advertisement placeholder to
share revenue relate to, e.g., how hardware and software
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resources are employed to place, manage and monitor blog
advertising in a manner that generates additional revenue for
bloggers and provides improved targeting for advertisers. When
considered as a whole, the combination of features recited by
the independent claims applies or uses any “judicial exception
in some other meaningful way beyond generally linking the use
of the judicial exception to a particular technological
environment, such that the claim as a whole is more than a
drafting effort designed to monopolize the exception.”
Appeal Br. 15 (quoting 2019 Guidance, 84 Fed Reg. at 53); see also Reply
Br. 2–9.
The Specification, which describes that the invention addresses
Internet-specific challenges for advertising related to “web logs” (“blogs”),
which includes accounting for the diffuse nature of Internet content, supports
Appellant’s argument. See Spec. 1:10–2:4. Claim 1 recites limitations to
address ad presentation and revenue sharing by Internet content and
aggregator web site providers, using an “advertisement placeholder” that is
embedded into Internet content.6 Artisans of ordinary skill recognize that
embedding placeholders into Internet content, as disclosed and recited,
involves compliance with technological standards and specifications related
to Internet content.
Beyond its recitations of a “processor,” “memory device,” and
“advertisement placeholder in the Internet content,” claim 1 requires a

6 As with the recitation of “aggregator web site,” see supra note 4, the first
step’s recitation of “a provider of Internet content” is an abstract reference to
an entity. In the second step, however, the recitations of “Internet content”
are not abstract—artisans of ordinary skill would understand, in the context
of the “providing” and “dynamically matching” requirements, “Internet
content” requires conformance with relevant Internet technology standards.
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sequenced combination of steps involving “an aggregator web site” and “a
server.” Claim 1 further requires using an identifier to identify (1) the
Internet content provider, (2) the aggregator web site provider, and (3)
policies specifying content constraints. The recited identifier particularly
limits the encompassed data structures for implementing an ad placeholder,
and claim 1 does not represent an attempt to patent every possible solution to
address the underlying problem or abstract idea.
This combination of extra elements, in combination with the abstract
limitations, addresses particular issues for Internet advertising involving
aggregator web sites when presenting Internet content provided by a third
party. As a technological result of claim 1, the advertising placeholder may
be distributed with the Internet content to enable automatic revenue sharing
as well as automatically performing customized, post-distribution, dynamic
ad selection for Internet content on aggregator web sites. As the Federal
Circuit has explained, claims that recite “limited rules in a process
specifically designed to achieve an improved technological result in
conventional industry practice” may be, as is the case here with claim 1’s
improvement to Internet advertising, patent eligible because they are not
directed to an abstract idea (or other judicial exception). See McRO, Inc. v.
Bandai Namco Games America Inc., 837 F.3d 1299, 1316 (Fed. Cir. 1016);
see also id. at 1307–08, 1313–16 (explaining “that processes that automate
tasks humans are capable of performing are patent eligible if properly
claimed” (id. at 1313)).
In view of the foregoing, we conclude claim 1 imposes meaningful
limits on the application of the recited abstract idea that, in combination,
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integrate it into a practical application. Thus, we agree with Appellant the
Examiner erred in rejecting claims 1–20 under 35 U.S.C. § 101.
The § 103 Rejections
Claim 1 requires an “advertisement placeholder” that “is a placeholder
for a distinct advertisement and comprises an identifier of said provider of
the Internet content, a provider of an aggregator web site and one or more
policies specifying one or more content constraints specified by . . .” (the
“ad-placeholder policy-constraint identifier” or “disputed” limitation). The
Examiner finds (1) Martinez’s use of “content-embedding code” (including
“an advertisement code section”) teaches the recited placeholder, including
the identifier that identifies the providers of the Internet content and the
aggregator web site, and (2) that Martinez’s “ad search system” that allows
users to “apply one or more policies or business rules directed to ad
selection” teaches the identifier of a policy specifying a content constraint,
as recited. Final Act. 6 (citing Martinez ¶¶ 55, 106, 109, Figs. 6A, 9A).
Appellant contends the Examiner errs in finding Martinez teaches the
ad-placeholder policy-constraint identifier limitation. Appeal Br. 17–21. In
particular, Appellant contends Martinez’s “content-embedding code” is
essentially unrelated to the “ad search system,” and it was improper for the
Examiner to find their combination teaches the disputed limitation. Id. at 19–
21. The Examiner responds by reiterating the findings from the rejection.
Ans. 5; Final Act. 6. Appellant replies by explaining that Martinez’s “Ad
Search System” as taught in paragraph 55 “has no nexus with the content
embedding discussion in the Section ‘Content Embedding and Content-
Embedding Code’ that starts at para. 0101” (i.e., the disclosure relied upon
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for the “advertisement placeholder” aspect of the ad-placeholder policy-
constraint identifier limitation). Reply Br. 10.
On this record, Appellant’s argument is persuasive. “[R]ejections on
obviousness grounds cannot be sustained by mere conclusory statements;
instead, there must be some articulated reasoning with some rational
underpinning to support the legal conclusion of obviousness.” In re Kahn,
441 F.3d 977, 988 (Fed. Cir. 2006); KSR Int’l Co. v. Teleflex Inc., 550 U.S.
398, 418 (2007) (quoting Kahn). Our review does not identify any common
functional link (or nexus) between the disparate “content-embedding code”
and “ad search system” disclosures in Martinez. The Examiner errs by not
articulating reasoning with a rational underpinning to explain why an artisan
of ordinary skill would have been motivated to go beyond the teachings of
Martinez and combine functionality from the “ad search system” into an
“advertisement code section.” Cf. Appeal Br. 17–21; Reply Br. 9–11.
Thus, we do not sustain the rejection of claim 1. Independent claims
14, 26, and 27 include essentially the same disputed limitation for which
their rejection relies on the same findings from Martinez, see Appeal Br.,
Claims App’x 4, 6–7; Final Act. 6, 8, and, thus, we also do not sustain their
rejection. We also, accordingly, do not sustain the rejections of the
dependent claims 3, 5–13, 16, 18–25, 28, and 29.
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CONCLUSION
In summary:
Claim(s)
Rejected
35 U.S.C.
§
Reference(s)/Basis Affirmed Reversed
1, 3, 5–14,
16, 18–29 101 Eligibility
1, 3, 5–14,
16, 18–29
1, 3, 5–9, 11–
14, 16, 18–29 103 Martinez
1, 3, 5–9, 11–
14, 16, 18–29
10 Martinez, Wu 10
Overall
Outcome
1, 3, 5–14, 16, 18–29

REVERSED