Jacob Loveless

Patent Trials and Appeals Board

Oct 23, 2019

14348919 - (D) (P.T.A.B. Oct. 23, 2019)

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.
14/348,919 04/01/2014 Jacob Loveless 13-2399WOUS 5449
63710 7590 10/23/2019
INNOVATION DIVISION
CANTOR FITZGERALD, L.P.
110 EAST 59TH STREET (6TH FLOOR)
NEW YORK, NY 10022
EXAMINER
SUBRAMANIAN, NARAYANSWAMY
ART UNIT PAPER NUMBER
3695
NOTIFICATION DATE DELIVERY MODE
10/23/2019 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):
lkorovich@cantor.com
patentdocketing@cantor.com
phowe@cantor.com
PTOL-90A (Rev. 04/07)

UNITED STATES PATENT AND TRADEMARK OFFICE

BEFORE THE PATENT TRIAL AND APPEAL BOARD

Ex parte JACOB LOVELESS

Appeal 2019-000117
Application 14/348,919
Technology Center 3600

Before ERIC S. FRAHM, JASON J. CHUNG, and
MICHAEL T. CYGAN, Administrative Patent Judges.

CYGAN, Administrative Patent Judge.

DECISION ON APPEAL
STATEMENT OF THE CASE
Pursuant to 35 U.S.C. § 134(a), Appellant1 appeals from the
Examiner’s decision to reject claims 2–10. We have jurisdiction under
35 U.S.C. § 6(b).
We AFFIRM.

1 We use the word “Appellant” to refer to “applicant” as defined in
37 C.F.R. § 1.42. Appellant identifies the real party in interest as CFPH,
LLC. Appeal Br. 1.
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CLAIMED SUBJECT MATTER
The disclosure of the application, which is entitled “Foreign Exchange
Trading,” is related to the field of electronic matching and trading items
between users. Title; Spec. ¶¶ 2, 3. Specifically, the claimed subject matter
is characterized as determining fill rates for providers of orders and filling
trading commands based on the fill rates. Abs. Claim 2 is illustrative:
2. A method comprising:
receiving by at least one server a first order and a second
order for an item, wherein:
the first order is associated with a first user and the
second order is associated with a second user, the first and
second orders have the same price associated therewith, the first
order is received in time before the second order, a fill rate is
associated with the first order, a fill rate is associated with the
second order, and the fill rate associated with the second order
is higher than the fill rate associated with the first order;
ordering by at least one server in an order book the
second order over the first order based at least in part on the fill
rate associated with the second order being higher than the fill
rate associated with the first order;
receiving by at least one server a trading command to
buy or sell the item;
based at least in part on ordering in the order book the
second order over the first order, communicating by at least one
server the trading command to the second user; and
responsive to communicating the trading command to the
second user, communicating by at least one server an indication
that the second user accepts entry into a trade against the
trading command.
Claim 5 sets forth an apparatus having limitations commensurate with
those in claim 2. Claim 8 sets forth a computer-readable medium having
limitations commensurate with those of claim 2. Dependent claims 3, 4, 6,
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7, 9, and 10 each incorporate the limitations of their respective independent
claims. Claim 1 has been withdrawn.
REJECTION
Claims 2–10 are rejected under 35 U.S.C. § 101 as lacking patent-
eligible subject matter.
OPINION
We have reviewed the Examiner’s subject-matter eligibility rejection
(Final Act. 2–9) in light of Appellant’s contentions that the Examiner has
erred (Appeal Br. 8–15). Further, we have reviewed the Examiner’s
response to Appellant’s arguments (Ans. 3–13) and Appellant’s Reply Brief.
We are not persuaded by Appellant that the Examiner erred in rejecting the
pending claims 2–10 under 35 U.S.C. § 101.
In support of subject matter eligibility, Appellant contends that the
claimed invention amounts to an improvement in computer performance;
specifically, improvements in electronic communication that include
processing and communicating trading transaction commands out of order
based on fill rates. Appeal Br. 10–11. Appellant further contends that the
claims are eligible as being directed to an improved computer interface,
citing the Federal Circuit’s reasoning in Core Wireless Licensing S.A.R.L. v.
LG Electronics, Inc., 880 F.3d 1356, 1363 (Fed. Cir. 2018). Id. at 12–13.
Appellant further contends that the claimed features are not well-understood,
routine, or conventional. Id. at 13. Finally, Appellant contends that the
rejection neglects to consider the lack of preemption reflected in Appellant’s
claims. Id.
With respect to Appellant’s final contention of error, we are not
persuaded by Appellant’s preemption argument because preemption
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concerns are addressed by the Supreme Court’s eligibility framework as
applied here, infra. Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d
1371, 1379 (Fed. Cir. 2015) (stating “[w]here a patent’s claims are deemed
only to disclose patent ineligible subject matter under
the Mayo [Collaborative Servs. v Prometheus Labs., Inc., 566 U.S. 66
(2012)] framework, . . . preemption concerns are fully addressed and made
moot”). A lack of complete preemption does not make the claims any less
abstract. OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1362–63
(Fed. Cir. 2015) (“[T]hat the 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.”).
A. Principles of Law
Patent-eligible subject matter is defined in 35 U.S.C. § 101 of the
Patent Act, which recites:
Whoever invents or discovers any new and useful process,
machine, manufacture, or composition of matter, or any new
and useful improvement thereof, may obtain a patent therefor,
subject to the conditions and requirements of this title.
There is, however, an implicit, longstanding exception to patent-
eligible subject matter in 35 U.S.C. § 101: “[l]aws of nature, natural
phenomena, and abstract ideas are not patentable.” Alice Corp. v. CLS Bank
Int’l, 573 U.S. 208, 216 (2014). This exception precludes patenting of “the
basic tools of scientific and technological work” from which all inventions
spring. Id. at 216–17. Invention or discovery under § 101 is distinguished
as being the application of such tools to an end otherwise satisfying the
requirements of the patent statute. See Gottschalk v. Benson, 409 U.S. 63,
67 (1972).
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The Supreme Court has established a framework for this eligibility
determination. Where a claim is directed towards a law of nature, natural
phenomena, or abstract idea, the elements of the claim as a whole must
ensure that the claim, in practice, amounts to significantly more than a patent
on the law of nature, natural phenomena, or abstract idea itself. Alice, 573
U.S. at 217–18. In applying this eligibility analysis, our reviewing court has
stated, “the decisional mechanism courts now apply is to examine earlier
cases in which a similar or parallel descriptive nature can be seen[,] . . . the
classic common law methodology for creating law when a single governing
definitional context is not available.” Amdocs (Isr.) Ltd. v. Openet Telecom,
Inc., 841 F.3d 1288, 1294 (Fed. Cir. 2016) (citation omitted).
To address the growing body of precedent, the USPTO recently
published revised examination guidance on the application of § 101. 2019
Revised Patent Subject Matter Eligibility Guidance, 84 Fed. Reg. 50, 50
(Jan. 7, 2019) (hereinafter “2019 Guidance”). The 2019 Guidance seeks to
improve the clarity of the subject-matter-eligibility analysis and improve
consistency of this analysis across the USPTO. Id.
Under the 2019 Guidance, we first look to whether the claim is
directed to a judicial exception because:
(1) the claim recites a law of nature, natural phenomenon, or
abstract idea, the last of which includes certain groupings,
identified as mathematical concepts, certain methods of
organizing human activity, and mental processes; and
(2) the claim as a whole fails to recite additional elements that
integrate the judicial exception into a practical application (see
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Manual of Patent Examination Procedure (hereinafter “MPEP”)
§§ 2106.05(a)–(c), (e)–(h) (9th ed. rev. 08.2017 Jan. 2018).
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:
adds a specific limitation beyond the judicial exception that is
not “well-understood, routine, conventional” in the field (see
MPEP § 2106.05(d)); or instead,
simply appends well-understood, routine, conventional
activities previously known to the industry, specified at a high
level of generality, to the judicial exception.
See 2019 Guidance, passim.
B. “Recites an Abstract Idea”
In the Final Action, the Examiner described claim 2 as being directed
to a judicial exception, identified as “trading based on fill rates associated
with orders,” and described as a method of organizing activity similar to the
concepts that have been identified by the courts such as creating and
fulfilling a contractual relationship. Final Act. 4–5 (citing buySAFE, Inc. v.
Google, Inc., 765 F.3d 1350 (Fed. Cir. 2014)). Appellant does not
specifically argue that claim 2 does not recite an abstract idea.
We do not find error in the Examiner’s determination that the actions
set forth in claim 2 recite acts of trading, such as receiving orders for an
item, associated with price and fill rate information, ranking the desirability
of trade actions based on criteria including the fill rate, and communicating
trading commands and indications that a trade has been accepted. Final Act
3–4. Because these activities are commercial or legal interactions
characterizing those certain methods held by the courts as abstract ideas
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(2019 Guidance, 84 Fed. Reg. at 52), we agree with the Examiner’s
unrebutted conclusion that claim 2 is directed to a method of organizing
activity, and therefore, to an abstract idea.
C. Directed to an Abstract Idea
The Examiner has determined that claim 2
merely amount[s] to the application or instructions to apply the
abstract idea (i.e. trading based on fill rates associated with
orders) on one or more computers, and are considered to
amount to nothing more than requiring a generic computer
system (e.g. an apparatus comprising at least one memory and
at least one computer suitably programmed suitably
programmed) to merely carry out the abstract idea itself. As
such, the claims, when considered as a whole, are nothing more
than the instructions to implement the abstract idea (i.e. trading
based on fill rates associated with orders) in a particular . . .
technological environment.
Final Act. 9.
Appellant contends that “the claimed subject matter is directed to
improvements in a computer trading system by processing and
communicating trading transaction commands out of order based on fill rates
over a network which may help reduce or control the number of messages or
commands over the network.” Appeal Br. 11 (emphasis omitted). Appellant
argues that delays in responding to a trading command can result in a taker
rescinding the trading command or seeking out other providers with which
to trade. Id. Appellant further argues that such reduction of messages and
commands may help improve computer performance by reducing computer
workload and computer resources. Id. Appellant analogizes the claims
under appeal to those found eligible in Core Wireless. Id. at 12–13.
Appellant further argues that the additional elements are not well-
understood, routine, or conventional. Appeal Br. 13 (citing Spec. ¶¶ 35–36).
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In Core Wireless, the claimed invention specified particular
technological functionality in the form of “an application summary that can
be reached directly from [a] menu” such that the summary window “is
displayed while the one or more applications are in an un-launched state.”
Core Wireless, 880 F.3d at 1362–63. The court in Data Engine
Technologies characterized the claimed invention in Core Wireless as not
“merely directed to the abstract idea of indexing information,” but instead
providing “an improved user interface for electronic devices” such that the
claim was “directed to ‘an improvement in the functioning of computers.’”
Data Engine Techs. LLC v. Google LLC, 906 F.3d 999, 1009 (Fed. Cir.
2018).
In Data Engine Technologies, the court addressed a set of claims
directed to a specific method of navigating three-dimensional spreadsheets
through the use of tabs. Id. at 1008–09. The inventive tabs permitted easy
access to spreadsheet workspaces that previously required a user to “search
through complex menu systems” and “memorize frequently needed
commands.” Id. at 1008. Certain claims “require[d] at least one user-
settable identifying character to label the notebook tab and describes
navigating through the various spreadsheet pages . . . that are identified by
their tabs.” Id. The court found the claims to require a “specific interface
and implementation for navigating complex three-dimensional spreadsheets
using techniques unique to computers.” Id. at 1009. The court distinguished
the claimed invention from one that would merely recite “a generic method
of labeling and organizing” spreadsheet data. Id. at 1008–09.
The court in Data Engine further addressed claims that recited
“associating each of the cell matrices with a user-settable page identifier”
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without “the specific implementation of a notebook tab interface.” Id. at
1012. The court held that these were claims not limited to the “specific
technical solution and improvement in electronic spreadsheet functionality”
set forth in the eligible tab claims and were, thus, found ineligible. Id.
Claim 2 does not recite an interface such as was found to provide
eligibility in Core Wireless. At most, the claim recites “communicating by
at least one server an indication that the second user accepts entry into a
trade.” Appeal Br. 18. Claim 2 does not set forth any particular interface
for such communicating, much less any particular technological
functionality or improvement of an interface itself, and is therefore more
akin to the ineligible claims in Data Engine than to the eligible claims in
Core Wireless.
To the extent that Appellant alleges improvement to computer
workload and computer resources, such alleged improvement is not to the
technological implementation set forth in claim 2, but instead to the
decisionmaking that is part of the abstract idea. The claimed fill rate itself
may be manually determined. Spec. ¶ 38. The alleged improvement to
computer workload and computer resources is the use of such fill rate
information to order trading transaction commands in a particular manner.
Appeal Br. 11. Thus, the alleged improvement has not been shown to be to
the computer implementation of the abstract idea rather than a consequence
of an improvement to an abstract itself; i.e., an improved manner of
determining a trade partner. The Bilski Court held that identifying trading
partners for buyers and sellers, and initiating transactions therebetween, is
itself an unpatentable abstract idea. Bilski v. Kappos, 561 U.S. 593, 611
(2010). As discussed by the Examiner, the Alice Corp. Court did not find an
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improvement to a particular type of bookkeeping, practiced on a generic
computer, to be an improvement to the functioning of a computer that
implemented such a bookkeeping idea. Ans. 11–12. Accordingly, we agree
with the reasoning and conclusion of the Examiner that claim 2 is not
directed to an improvement to a computer system or an improvement to
another technology or technical field, but instead directed to an abstract idea.
D. Significantly More Than the Abstract Idea
Where a claim is directed to an abstract idea, the additional limitations
of the claim may provide an inventive concept so as to provide subject-
matter eligibility. An inventive concept may be shown where a limitation or
combination of limitations is more than well-understood, routine,
conventional activity.
Appellant argues that the additional elements are not well-understood,
routine, or conventional, as understood by reference to the Specification.
Appeal. Br. 13 (citing Spec. ¶¶ 35–36). Appellant further argues that the
Examiner has not made the case showing that the elements are well-
understood, routine, or conventional. Id. However, the additional elements
identified by the Examiner are “a generic computer system [, ]e.g. an
apparatus comprising at least one memory and at least one computer suitably
programmed” for the trading operations of gathering and manipulating data
to trade based upon fill rates associated with orders. Final Act. 9. The
Examiner has determined that the claimed functions of receiving orders,
ordering in an order book, receiving a trading command, and communicating
an indication of acceptance are conventional functions of a computer. Id. at
6. The Examiner has cited to Alice Corp. for the proposition that the use of
a computer to create electronic records, track multiple transactions, and issue
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simultaneous instructions is not an inventive concept. Id. at 11–12. The
Examiner’s determination is consistent with USPTO Guidance, which
permits showing an element to be well-understood, routine, conventional
through a citation to a court decision discussed in MPEP § 2106.05(d)(II).
Appeal Br. 13 (citing USPTO Memorandum, Changes in Examination
Procedure Pertaining to Subject Matter Eligibility, Recent Subject Matter
Eligibility Decision (Berkheimer v. HP, Inc.) (Apr. 19, 2018), available at
https://www.uspto.gov/sites/default/files/documents/memo-berkheimer-
20180419.PDF). The Alice Corp. decision is discussed in MPEP
§ 2106.05(d)(II)(iii) for the proposition that electronic recordkeeping,
including creating and maintaining accounts (e.g., of financial transactions),
has been recognized by the courts as well-understood, routine, conventional
activity. Accordingly, Appellant has not shown error in the Examiner’s
determination that the additional elements in the claim are well-understood,
routine, conventional activity.
Consequently, we determine that claim 2 is ineligible subject matter
under 35 U.S.C. § 101, and we sustain the Examiner’s rejection of claim 2
on that ground.
1. Claims 3–10
Appellant does not argue separately the limitations of dependent
claims 3–10; accordingly, they stand or fall with claim 2, and the rejection of
those claims under § 101 is sustained.

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CONCLUSION
In summary:
Claims
Rejected
35 U.S.C. § Basis Affirmed Reversed
2–10 101 Eligibility 2–10

TIME PERIOD FOR RESPONSE
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).
AFFIRMED