Loss of Use, Inc.Download PDFPatent Trials and Appeals BoardJun 21, 20212021001143 (P.T.A.B. Jun. 21, 2021) Copy Citation 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. 14/814,493 07/30/2015 Brenda Lou Perkins 3725254.00003 5767 29156 7590 06/21/2021 K&L Gates LLP-ADMINRPL P.O. Box 1135 CHICAGO, IL 60690 EXAMINER POLLOCK, GREGORY A ART UNIT PAPER NUMBER 3695 NOTIFICATION DATE DELIVERY MODE 06/21/2021 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): USpatentmail@klgates.com PTOL-90A (Rev. 04/07) UNITED STATES PATENT AND TRADEMARK OFFICE ____________ BEFORE THE PATENT TRIAL AND APPEAL BOARD ____________ Ex parte BRENDA LOU PERKINS ____________ Appeal 2021-001143 Application 14/814,493 Technology Center 3600 ____________ Before NINA L. MEDLOCK, TARA L. HUTCHINGS, and AMEE A. SHAH, Administrative Patent Judges. MEDLOCK, Administrative Patent Judge. DECISION ON APPEAL STATEMENT OF THE CASE Appellant1 appeals under 35 U.S.C. § 134(a) from the Examiner’s rejection of claims 1, 4–17, 21, and 22. We have jurisdiction under 35 U.S.C. § 6(b). We AFFIRM. 1 We use the term “Appellant” to refer to “applicant,” as defined in 37 C.F.R. § 1.42. Our decision references Appellant’s Appeal Brief (“Appeal Br.,” filed October 18, 2019) and the Examiner’s Answer (“Ans.,” mailed October 5, 2020) and Non-Final Office Action (“Non-Final Act.,” mailed April 18, 2019). Appellant identifies Loss of Use, Inc. as the real party in interest (Appeal Br. 3). Appeal 2021-001143 Application 14/814,493 2 CLAIMED INVENTION The Specification states, “the present invention relates to a claims processing system for temporary housing claims to eliminate the mark-up caused by middlemen, such as temporary housing suppliers, by providing software platforms for managing the temporary housing claims transparently using outside hotel and housing contractors” (Spec. ¶ 2). Claims 1 and 21 are the independent claims on appeal. Claim 1, reproduced below with bracketed notations added, is illustrative of the claimed subject matter: 1. A claims processing system for processing an insurance claim for a housing property loss insured by an insurer comprising: a controller; and a memory in communication with the controller, the memory including instructions that, when executed by the controller, cause the controller to: [(a)] receive a claim, the claim including claim parameters including an anticipated lease term, a location related to the housing property loss, a loss value, and a number of people to be housed, wherein the claim is received from the adjuster subsystem and communicated to the customer experience subsystem, wherein the adjuster subsystem and customer experience subsystem are in communication with the controller; [(b)] generate, via the hotel/housing subsystem in communication with the controller, a fair market evaluation of loss based on a type of dwelling, a number of bedrooms, a number of bathrooms, and a location of the housing property loss; [(c)] identify, via the hotel/housing subsystem, a pool of acceptable housing accommodations matching within a range for each of the claim parameters, wherein each of the acceptable housing accommodations is within a predetermined monetary range of the fair market evaluation of loss; Appeal 2021-001143 Application 14/814,493 3 [(d)] select, via the customer experience subsystem, a housing accommodation from the pool of acceptable housing accommodations; [(e)] receive, via the hotel/housing subsystem, a vendor invoice from a vendor providing the selected housing accommodation including: an amount due, a retail rate, and a discounted rate; and [(f)] receive, via the accounting subsystem in communication with the controller, confirmation of receipt of payment from the insurer corresponding to the amount due and a portion of the difference between the retail rate and the discounted rate. REJECTION2 Claims 1, 4–17, 21, and 22 are rejected under 35 U.S.C. § 101 as directed to a judicial exception without significantly more. ANALYSIS Appellant argues the pending claims as a group (Appeal Br. 7–14). We select independent claim 1 as representative. The remaining claims stand or fall with claim 1. See 37 C.F.R. §41.37(c)(1)(iv). Under 35 U.S.C. § 101, “[w]hoever 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.” 35 U.S.C. § 101. The Supreme Court, however, has long interpreted § 101 to include an implicit exception: “[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). 2 The Examiner has withdrawn the rejection of claim 1 under 35 U.S.C. § 112, second paragraph, as indefinite (Ans. 3–4). Appeal 2021-001143 Application 14/814,493 4 The Supreme Court, in Alice, reiterated the two-step framework previously set forth in Mayo Collaborative Services v. Prometheus Laboratories, Inc., 566 U.S. 66 (2012), “for distinguishing patents that claim laws of nature, natural phenomena, and abstract ideas from those that claim patent-eligible applications of those concepts.” Alice Corp., 573 U.S. at 217. The first step in that analysis is to “determine whether the claims at issue are directed to one of those patent-ineligible concepts.” Id. If the claims are not directed to a patent-ineligible concept, e.g., an abstract idea, 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 there are additional elements that “‘transform the nature of the claim’ into a patent-eligible application.” Id. (quoting Mayo, 566 U.S. at 79, 78). This is “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. at 217–18 (alteration in original). The U.S. Patent and Trademark Office (the “USPTO”) published revised guidance on January 7, 2019, for use by USPTO personnel in evaluating subject matter eligibility under 35 U.S.C. § 101. 2019 REVISED PATENT SUBJECT MATTER ELIGIBILITY GUIDANCE, 84 Fed. Reg. 50 (Jan. 7, 2019) (the “2019 Revised Guidance”).3 That guidance revised the USPTO’s examination procedure with respect to the first step of the Mayo/Alice framework by (1) “[p]roviding groupings of subject matter that [are] 3 The MANUAL OF PATENT EXAMINING PROCEDURE (“MPEP”) incorporates the revised guidance and subsequent updates at Section 2106 (9th ed. Rev. 10.2019, rev. June 2020). Appeal 2021-001143 Application 14/814,493 5 considered an abstract idea”; and (2) clarifying that a claim is not “directed to” a judicial exception if the judicial exception is integrated into a practical application of that exception. Id. at 50. The first step, as set forth in the 2019 Revised Guidance (i.e., Step 2A), is, thus, a two-prong test. In Step 2A, Prong One, we look to whether the claim recites a judicial exception, e.g., one of the following three groupings of abstract ideas: (1) mathematical concepts; (2) certain methods of organizing human activity, e.g., fundamental economic principles or practices, commercial or legal interactions; and (3) mental processes. 2019 Revised Guidance, 84 Fed. Reg. at 54. If so, we next determine, in Step 2A, Prong Two, whether the claim as a whole integrates the recited judicial exception into a practical application, i.e., whether the additional elements recited in the claim beyond the judicial exception, apply, rely on, or use the judicial exception in a manner that imposes a meaningful limit on the judicial exception, such that the claim is more than a drafting effort designed to monopolize the judicial exception. Id. at 54–55. Only if the claim (1) recites a judicial exception and (2) does not integrate that exception into a practical application do we conclude that the claim is “directed to” the judicial exception, e.g., an abstract idea. Id. If the claim is determined to be directed to a judicial exception under revised Step 2A, we next evaluate the additional elements, individually and in combination, in Step 2B, to determine whether they provide an inventive concept, i.e., whether the additional elements or combination of elements amounts to significantly more than the judicial exception itself; only then, is the claim patent eligible. 2019 Revised Guidance, 84 Fed. Reg. at 56. Appeal 2021-001143 Application 14/814,493 6 Here, in rejecting the pending claims under § 101, the Examiner determined that steps (a) through (f) of claim 1 recite processing an insurance claim for a housing property loss, i.e., a method of organizing human activity and, therefore, an abstract idea (Non-Final Act. 3–5). The Examiner also determined that the claim does not include additional elements that integrate the abstract idea into a practical application; that the additional elements recited in claim 1 are not sufficient to amount to significantly more than the abstract idea itself; and that the remaining claims are patent ineligible for substantially the same reasons (id. at 5–7). Step One of the Mayo/Alice Framework (2019 Revised Guidance, Step 2A) We are not persuaded by Appellant’s argument that the Examiner erred in determining that claim 1 is directed to an abstract idea (Appeal Br. 18–33). The Federal Circuit has explained that “the ‘directed to’ inquiry applies a stage-one filter to claims, considered in light of the specification, based on whether ‘their character as a whole is directed to excluded subject matter.’” Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1335 (Fed. Cir. 2016) (quoting Internet Patents Corp. v. Active Network, Inc., 790 F.3d 1343, 1346 (Fed. Cir. 2015)). It asks whether the focus of the claims is on a specific improvement in relevant technology or on a process that itself qualifies as an “abstract idea” for which computers are invoked merely as a tool. See id. at 1335–36. Here, it is clear from the Specification (including the claim language) that claim 1 focuses on an abstract idea, and not on an improvement to technology and/or a technical field. The Specification is titled “CLAIM PROCESSING SYSTEM FOR TEMPORARY HOUSING CLAIMS,” and describes that, prior to 1980, property and casualty (“P&C”) insurers offered no assistance to Appeal 2021-001143 Application 14/814,493 7 policyholders who needed temporary housing following a loss (Spec. ¶ 4). “Realizing that this was an overwhelming undertaking for their insured, the P&C Insurers decided to offer a service to assist their insured”; and “they teamed up with the temporary housing industry to facilitate Schedule D claims — additional living expenses” (id.). The temporary housing industry is part of the hotel industry, and emerged as an alternative to hotels to meet corporate America’s need to relocate employees for short-term assignments; in accordance with this model, a temporary housing supplier, i.e., a middleman retailer, rents goods and services from various vendors, marks up the original retail costs to cover overhead and profit, and then rents (subleases) the fully furnished temporary dwelling to the customer for one all-inclusive price (id. ¶ 6). This cost-plus model works for corporate business that spend money as an investment, fully expecting a return on investment (id. ¶ 7). “However, with the P&C industry all money spent is a loss expense; therefore, controlling actual costs is of paramount importance” (id.). The Specification describes that, before teaming up with the temporary housing industry, the P&C Industry did not perform its due diligence; “[c]onsequently the P &C Industry has been overcharged . . . millions of dollars by [its] temporary housing suppliers over the last 30 years in inflated loss expense payouts — artificially increasing [its] risk liability” (id. ¶ 5). Previous attempts have been made to solve the problem of temporary housing overbilling, but, according to the Specification, these attempts have been largely unsuccessful (id. ¶¶ 16–23). Therefore, “there is a need for a claims processing system for temporary housing claims to remove the costly markup of temporary housing suppliers” (id. ¶ 24). Appeal 2021-001143 Application 14/814,493 8 The claimed invention ostensibly is intended to address this need. Claim 1, thus, recites a claims processing system for processing an insurance claim for a housing property loss insured by an insurer comprising a controller and a memory in communication with the controller. The memory includes instructions that, when executed by the controller, cause the controller to: (1) receive a claim including claim parameters, i.e., an anticipated lease term, a location related to the housing property loss, and a number of people to be housed, i.e., receive a claim, the claim including claim parameters including an anticipated lease term, a location related to the housing property loss, a loss value, and a number of people to be housed, wherein the claim is received from the adjuster subsystem and communicated to the customer experience subsystem, wherein the adjuster subsystem and customer experience subsystem are in communication with the controller (step (a)); (2) identify a pool of acceptable housing accommodations based on a fair market evaluation of the housing property loss, i.e., generate, via the hotel/housing subsystem in communication with the controller, a fair market evaluation of loss based on a type of dwelling, a number of bedrooms, a number of bathrooms, and a location of the housing property loss; [and] identify, via the hotel/housing subsystem, a pool of acceptable housing accommodations matching within a range for each of the claim parameters, wherein each of the acceptable housing accommodations is within a predetermined monetary range of the fair market evaluation of loss (steps (b) and (c)); (3) select a housing accommodation from the pool of acceptable housing accommodations and receive an invoice from the vendor providing the selected accommodation, i.e., “select, via the customer experience subsystem, a housing accommodation from the pool of Appeal 2021-001143 Application 14/814,493 9 acceptable housing accommodations” and “receive, via the hotel/housing subsystem, a vendor invoice from a vendor providing the selected housing accommodation including: an amount due, a retail rate, and a discounted rate” (steps (d) and (e)); and (4) receive confirmation that payment has been received from the insurer, i.e., “receive, via the accounting subsystem in communication with the controller, confirmation of receipt of payment from the insurer corresponding to the amount due and a portion of the difference between the retail rate and the discounted rate” (step (f)). We agree with the Examiner that these limitations, when given their broadest reasonable interpretation, recite “processing an insurance claim for a housing property loss” (Non-Final Act. 3), i.e., a commercial interaction, which is a method of organizing human activity and, therefore, an abstract idea. See 2019 Revised Guidance, 84 Fed. Reg. at 52. Appellant does not challenge the Examiner’s determination that claim 1 recites an abstract idea. Instead, Appellant maintains that claim 1 is not directed to an abstract idea because the claim includes additional elements that improve a technical field and, thus, integrate any alleged judicial exception into a practical application (Appeal Br. 8–9). The 2019 Revised Guidance references MPEP, Ninth Edition (rev. Jan 2018) (available at https://www.uspto.gov/web/offices/ pac/mpep/old/mpep_E9R08-2017.htm) § 2106.05(a)–(c) and (e) in non-exhaustively listing considerations indicative that an additional element or combination of elements may have integrated a recited judicial exception into a practical application. 2019 Revised Guidance, 84 Fed. Reg. at 55. In particular, the Guidance describes that an additional element may have integrated the judicial exception into a practical application if the additional Appeal 2021-001143 Application 14/814,493 10 element (1) reflects an improvement in the functioning of a computer or an improvement to other technology or technical field; (2) applies or uses the judicial exception to effect a particular treatment or prophylaxis for a disease or medical condition; (3) implements the judicial exception with, or uses the judicial exception with, a particular machine or manufacture integral to the claim; (4) effects a transformation or reduction of an article to a different state or thing; or (5) applies or uses the 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. Id. At the same time, the Guidance makes clear that merely including instructions to implement an abstract idea on a computer, or merely using a computer as a tool to perform an abstract idea; adding insignificant extra-solution activity to the judicial exception; or only generally linking the use of the judicial exception to a particular technological environment or field are not sufficient to integrate the judicial exception into a practical application. Id. Appellant argues here that “the present system is directed to the improved technology of a claim processing system for temporary housing claims by eliminating the mark-up caused by middlemen, such as temporary housing suppliers” and “by providing software platforms for managing the temporary housing claims transparently using outside hotel and housing contractors” (Appeal Br. 9). Appellant asserts that, in contrast to prior art systems, the present system improves technology by providing “unobstructed analytical insight into actual supplier costs” and “a P&C Insurance Industry specific proprietary ‘supplier’ data processing system for receiving, collecting, recording, storing, monitoring and reporting Appeal 2021-001143 Application 14/814,493 11 information necessary to process Schedule D claims” (id. at 10), and that “[t]he present invention creates a technical improvement over the prior art by providing technology to improve the Schedule D Claims loss to improve operational efficiency” (id. at 11). Appellant further explains, the present system creates a technical improvement by providing a structural interface between an adjuster system, customer experience manager subsystem, H/H subsystems, and an accounting subsystem, wherein the system generates a fair market evaluation of loss and identifies and selects a housing accommodation within a predetermined range of the fair market evaluation of loss (Appeal Br. 11). But, we are not persuaded that these are technological improvements as opposed to improvements to the abstract idea of processing claims for housing property losses, which is not enough for patent eligibility. See SAP Am., Inc. v. InvestPic, LLC, 898 F.3d 1161, 1170 (Fed. Cir. 2018) (“[P]atent law does not protect such claims[, i.e., claims to an asserted advance in the realm of abstract ideas], without more, no matter how groundbreaking the advance.”). This is particularly true where, as here, we find no indication in the Specification that the operations recited in claim 1 require any specialized computer hardware or other inventive computer components, invoke any allegedly inventive programming, or that the claimed invention is implemented using other than generic computer components as tools operating in their normal and ordinary capacity. We also are not persuaded of Examiner error to the extent Appellant maintains that claim 1 is patent eligible because it presents no risk of preemption (Appeal Br. 11–12). Although the Supreme Court has described “the concern that drives [the exclusion of abstract ideas from patent-eligible Appeal 2021-001143 Application 14/814,493 12 subject matter] as one of pre-emption,” Alice Corp., 573 U.S. at 216, characterizing preemption as a driving concern for patent eligibility is not the same as characterizing preemption as the sole test for patent eligibility. “The Supreme Court has made clear that the principle of preemption is the basis for the judicial exceptions to patentability” and “[f]or this reason, questions on preemption are inherent in and resolved by the § 101 analysis.” Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir. 2015) (citing Alice Corp., 573 U.S. at 216). “[P]reemption may signal patent ineligible subject matter, [but] the absence of complete preemption does not demonstrate patent eligibility.” Id. We conclude, for the reasons outlined above, that claim 1 recites a method of organizing human activity, i.e., an abstract idea, and that the additional elements recited in the claim beyond the abstract idea, i.e., “a controller” and “a memory in communication with the controller,” are no more than generic computer components used as tools to perform the recited abstract idea. As such, they do not integrate the abstract idea into a practical application. See Alice Corp., 573 U.S. at 223–24 (“[W]holly generic computer implementation is not generally the sort of ‘additional featur[e]’ that provides any ‘practical assurance that the process is more than a drafting effort designed to monopolize the [abstract idea] itself.’” (quoting Mayo, 566 U.S. at 77)). Accordingly, we agree with the Examiner that claim 1 is directed to an abstract idea. Step Two of the Mayo/Alice Framework (2019 Revised Guidance, Step 2B) Having determined under step one of the Mayo/Alice framework that claim 1 is directed to an abstract idea, we next consider under Step 2B of the 2019 Revised Guidance, the second step of the Mayo/Alice framework, Appeal 2021-001143 Application 14/814,493 13 whether claim 1 includes additional elements or a combination of elements that provides an “inventive concept,” i.e., whether claim 1 includes additional elements that amount to “significantly more” than the judicial exception itself. 2019 Revised Guidance, 84 Fed. Reg. at 56. We agree with the Examiner that claim 1 does not include any such additional elements. And Appellant does not present any arguments to the contrary. We are not persuaded, on the present record, that the Examiner erred in rejecting claim 1 under 35 U.S.C. § 101. Therefore, we sustain the Examiner’s rejection of claim 1, and claims 4–17, 21, and 22, which fall with claim 1. CONCLUSION In summary: Claims Rejected 35 U.S.C. § Reference(s)/Basis Affirmed Reversed 1, 4–17, 21, 22 101 Eligibility 1, 4–17, 21, 22 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 Copy with citationCopy as parenthetical citation