Rodriguez, Alan F. et al.

Patent Trials and Appeals Board

Oct 22, 2019

11818693 - (D) (P.T.A.B. Oct. 22, 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.
11/818,693 06/15/2007 Alan F. Rodriguez JR. 013647.00024 2048
33649 7590 10/22/2019
Mr. Christopher John Rourk
Jackson Walker LLP
2323 ROSS AVENUE
SUITE 600
DALLAS, TX 75201
EXAMINER
WINTER, JOHN M
ART UNIT PAPER NUMBER
3685
MAIL DATE DELIVERY MODE
10/22/2019 PAPER
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.
PTOL-90A (Rev. 04/07)

UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________

Ex parte ALAN F. RODRIGUEZ JR., CHRISTOPHER W. CROSS,
DORWIN SHIELDS JR., and DAVID T. MECKENSTOCK
____________

Appeal 2017-0063061
Application 11/818,693
Technology Center 3600
____________

Before ANTON W. FETTING, JOSEPH A. FISCHETTI, and
BIBHU R. MOHANTY, Administrative Patent Judges.

FETTING, Administrative Patent Judge.

DECISION ON APPEAL

1 An oral hearing was conducted October 3, 2019.
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STATEMENT OF THE CASE2
Alan F. Rodriguez Jr., Christopher W. Cross, Dorwin Shields Jr., and
David T. Meckenstock (Appellant3) seek review under 35 U.S.C. § 134 of a
non-final rejection of claims 22–28 and 52–63, the only claims pending in
the application on appeal. We have jurisdiction over the appeal pursuant to
35 U.S.C. § 6(b).
The Appellant invented a way of transmitting credit transaction data
that allows the credit transaction data to be transmitted over a
communications medium. Spec. 1:23–27.
An understanding of the invention can be derived from a reading of
exemplary claims 22 and 63, which are reproduced below (bracketed matter
and some paragraphing added).
22. An apparatus for transmitting credit transaction data over a
communications medium comprising:
[1] a protocol translator for receiving the credit transaction data
from two or more point of sale systems according to two
or more different transmission protocols,
each transmission protocol associated with a different
credit authorization system,
and forming a credit transaction data message;

2 Our decision will make reference to the Appellant’s Appeal Brief (“App.
Br.,” filed August 4, 2016) and Reply Brief (“Reply Br.,” filed February 4,
2017), and the Examiner’s Answer (“Ans.,” mailed December 14, 2016),
and Non-Final Action (“Non-Final Act.,” mailed January 4, 2016).
3 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
Paymentech, L.P. (App. Br. 3).

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and
[2] means for
receiving the credit transaction data message from the
protocol translator
and
encrypting the credit transaction data message.
63. An apparatus for transmitting credit transaction data over a
communications medium comprising:
[1] a protocol translator operating on a processor and
configured to receive the credit transaction data from two or
more point of sale systems according to two or more different
transmission protocols, each transmission protocol associated
with a different credit authorization system, and to form a credit
transaction data message;
and
[2] the processor configured to receive the credit transaction
data message from the protocol translator and to encrypt the
credit transaction data message using an encryption system to
receive the credit transaction data message and to encrypt the
credit transaction data message.
The Examiner relies upon the following prior art:
Name Reference Date
Dickerman US 6,160,874 Dec. 12, 2000
Kramer US 6,324,525 B1 Nov. 27, 2001
Claims 22–28 and 52–63 stand rejected under 35 U.S.C. § 112,
second paragraph as failing to particularly point out and distinctly claim the
invention.
Claims 22–28 and 52–63 stand rejected under 35 U.S.C. § 101 as
directed to a judicial exception without significantly more.
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Claims 22–28 and 52–63 stand rejected under 35 U.S.C. § 103(a) as
unpatentable over Kramer and Dickerman.
ISSUES
The issues of indefiniteness turn primarily on whether 35 U.S.C.
§ 112, sixth paragraph requires a description within the four corners of the
specification and drawings of how the recited functions are performed in
order to construe a means plus function limitation, and if so, whether the
specification and drawings provide that description.
The issues of eligible subject matter turn primarily on whether the
claims recite more than abstract conceptual advice of results desired.
The issues of obviousness turn primarily on claim construction and
whether the Examiner has made determinations as to how the art describes
the claims.
FACTS PERTINENT TO THE ISSUES
The following enumerated Findings of Fact (FF) are believed to be
supported by a preponderance of the evidence.
Facts Related to Claim Construction
01. The Specification does not lexicographically define
“encrypting.”
02. The customary definition of “encrypt” in a computer context is
to alter (data) using a mathematical algorithm so as to make the
data unintelligible to unauthorized users while allowing a user
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with a key or password to convert the altered data back to its
original state.4
Facts Related to Appellant’s Disclosure
03. The Specification nowhere describes receiving simultaneously
data from two or more point of sale systems according to two or
more different transmission protocols. All references to receiving
data from two or more such systems instead describe no more than
the capacity to do so alternately.
04. The Specification and drawings nowhere describe combining
data from two or more point of sale systems into a single message.
05. The Specification and drawings nowhere describe structure
for receiving credit transaction data message from the protocol
translator.
06. The Specification nowhere describes structure for encrypting
the credit transaction data message.
07. The word “means” in claim 22 is followed by two functions,
viz. receiving a message and encrypting the message.
08. As to claims 22–28, Appellant cites references 702 and 704 of
Figure 7 and the associated description at page 21, line 25 to page
22, line 15 of the Specification as describing the structure
corresponding to the claim 22 means for receiving the credit
transaction data message from the protocol translator and
encrypting the credit transaction data message. App. Br. 5.

4 American Heritage Dictionary, https://www.ahdictionary.com/
word/search.html?q=encrypt, last accessed Oct. 4, 2019.
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09. References 702 and 704 are black boxes in a flow chart that are
titled as each of the functions recited in the means at issue. The
attendant Specification portions cited describe reference 702 as
the function of credit transaction data being received and reference
704 as the function of the credit transaction data being assembled
into an authorization request and encrypted. The description that
the data can be received with suitable protocols and encrypted
with an updateable encryption module add no structural
information or limitation to the receiving and encrypting
functions.
10. As to claims 52–62, Appellant cites Figure 5 reference 502 and
the associated description at page 16, lines 20 to page 11–25 of the
Specification as describing the structure corresponding to the
claim 52 means for receiving the credit transaction data, and
forming a credit transaction data message. App. Br. 5. Figure 5 is
a block diagram (not a process flowchart) of contents of a system
for providing remote hub access to a gateway system. Spec. 6:16–
17. This diagram contains several black boxes, one of the black
boxes having the title of Encryption System. There is no box
labeled as receiving a message. As currently displayed, the Figure
5 flowchart does not contain a step or function of encrypting a
message. Accordingly, the encrypting function must also be
within block 502. The attendant Specification portions cited
describe reference 502 as follows:
Encryption system 502 receives credit transaction
data from a point of sale system and encrypts the credit
transaction data for transmission over a suitable
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communications medium, such as the Internet.
Encryption system 502 can receive credit transaction data
in a first legacy protocol format from the point of sale
system, and can extract the credit transaction data for
transmission to a gateway system 106. Encryption system
502 then uses an encryption algorithm or other suitable
encryption procedures to encrypt the data in a manner
that prevents the data from being intercepted by
unauthorized third parties. The encrypted data is then
transmitted over the communications medium to the
gateway system. Encryption system 502 can also receive
an encryption module and update the encryption
procedure used to encrypt the credit transaction data.
Spec. 16:11–25. The portion describing the encryption function
“uses an encryption algorithm or other suitable encryption procedures
to encrypt the data in a manner that prevents the data from being
intercepted by unauthorized third parties” and “can also receive an
encryption module and update the encryption procedure used to
encrypt the credit transaction data.”
Facts Related to the Prior Art
Kramer
11. Kramer is directed to the secure, electronic payment in
exchange for goods and services purchased over a communication
network, and more specifically, to the settlement of aggregated
electronic transactions over a network. Kramer 1:26–30.
Dickerman
12. Dickerman is directed to providing a messaging interface
between one or more computer system environments. Dickerman
1:20–23.
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ANALYSIS
Claim Construction
Claim 22, limitation 1. Although the Examiner had construed this
prior to first Appeal as a means plus function limitation, we determined that
this limitation was not expressed as means plus function in the prior Appeal.
Prior Appeal at 6–8. This determination was procedural rather than
substantive because the Examiner made no finding to rebut the
presumption against such construction given the lack of the word
“means” and lack of findings as to whether the phrase “protocol
translator” recited structure. We do not revisit this determination at this
time.
Claim 22, limitation 2. This is construed as a means plus function
limitation because of the word “means,” and two recited functions without
structure recited to perform the functions. This is uncontested. Whether it
can or cannot be construed is contested.
The word means is followed by two functions, viz. receiving a
message and encrypting the message.
As to claims 22–28, Appellant cites references 702 and 704 of
Figure 7 and the associated description at page 21, line 25 to page 22, line
15 of the Specification as describing the structure corresponding to the
claim 22 means for receiving the credit transaction data message from
the protocol translator and encrypting the credit transaction data
message. App. Br. 5, 9.
References 702 and 704 are black boxes in a flow chart that are
titled as each of the functions recited in the means at issue. The attendant
Specification portions cited describe reference 702 as the function of
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credit transaction data being received and reference 704 as the function of
the credit transaction data being assembled into an authorization request
and encrypted. The description that the data can be received with
suitable protocols and encrypted with an updateable encryption module
adds no structural information or algorithmic performance limitation to
the receiving and encrypting functions. Although Figure 7 might be said
to describe invoking some arbitrary but otherwise undescribed receiving
and encrypting functions, Figure 7 and the single box for each cannot be
said to describe performing each respective function. A description of
invoking a black box function is not a description of how that box
performs that function. An invocation is a command to “do it” without
describing how to do it.
As to claims 52–62, Appellant cites Figure 7 and the associated
description at page 21, line 20 to page 23, line 25 of the Specification as
describing the structure corresponding to the claim 52 means for
receiving the credit transaction data, and forming a credit transaction
data message. App. Br. 5, 9. Figure 7 contains several black boxes in a
flow chart, one of the black boxes having the title of receiving credit
transaction data. There is no box labeled as forming a credit transaction
data message. Indeed, the box that immediately follows the receiving
box (702) is the encryption of the second structural limitation of claim
52. As currently displayed, the Figure 7 flowchart does not contain a
step or function of forming a message separate from block 702.
Accordingly, the forming function must also be within block 702. The
attendant Specification portions cited describe reference 702 as the
function of credit transaction data being received. The description that
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the data can be received with suitable protocols adds no structural
information or algorithmic limitation to the receiving and forming
functions, and Appellant does not discuss the contents of those protocols.
The ISO 8583 protocol and the VISA-K protocol described there are data
mapping, not data reception or encryption, protocols.
Claim 63 does not use the word “means.” The Examiner makes no
findings to overcome the presumption that the limitations are not covered
by 35 U.S.C. § 112 paragraph 6. Thus, we do not construe them as such.
Determination of whether claims 22–28 and 52–62 can be construed
35 U.S.C. § 112 paragraph 6 reads:
An element in a claim for a combination may be
expressed as a means or step for performing a specified
function without the recital of structure, material, or acts in
support thereof, and such claim shall be construed to cover the
corresponding structure, material, or acts described in the
specification and equivalents thereof.
35 U.S.C. § 112 para. 6. As a matter of statutory construction, this requires
that a claim expressed as a means or step for performing a specified function
without the recital of structure, material, or acts in support thereof be
construed based on the description in the specification of how the function is
performed by the structure. Thus, this is a requirement for construction, not
for patentability, that includes a requirement that the description of how the
recited function is performed that is written in the specification be used in
the construction to determine the scope of the limitation. On its face, then,
there must be such a description found in the specification, or else
construction cannot be accomplished.
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The requirement that the description be found in the specification
has been interpreted to include finding the description in the drawings as
well.
Congress thus provided the patentee with two benefits from
section 112(6): first, it need not claim structure but can simply
rely on the written description and drawings to obtain
protection for all of its disclosed structures; and second, it gets
protection of all equivalents of whatever structures it has
disclosed in its specification.
Dawn Equip. Co. v. Kentucky Farms Inc., 140 F.3d 1009, 1023 (Fed. Cir.
1998). This includes flow charts in the specification or drawings. “This
court permits a patentee to express that algorithm in any understandable
terms including as a mathematical formula, in prose, or as a flow chart, or in
any other manner that provides sufficient structure.” Finisar Corp. v.
DirecTV Group, Inc., 523 F.3d 1323, 1340 (Fed. Cir. 2008) (citation
omitted). There is no issue of whether flow charts can serve to describe
algorithmic structure. They can. The issue is whether the flow charts in the
Specification and drawings of this Application and their attendant
Specification descriptions describe relevant structure to perform the recited
functions.
To perform the construction, we first identify and construe the
function itself.
The first step in construing a means-plus-function claim
limitation is to define the particular function of the claim
limitation. “The court must construe the function of a means-
plus-function limitation to include the limitations contained in
the claim language, and only those limitations.”. . . Ordinary
principles of claim construction govern interpretation of this
claim language.
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Golight, Inc. v. Wal-Mart Stores, Inc., 355 F.3d 1327, 1333–34 (Fed. Cir.
2004) (citations omitted).
Then we identify the text and drawings that describe how to perform
that function.
The next step in construing a means-plus-function claim
limitation is to look to the specification and identify the
corresponding structure for that function. “Under this second
step, ‘structure disclosed in the specification is “corresponding”
structure only if the specification or prosecution history clearly
links or associates that structure to the function recited in the
claim.’”
Id. at 1334.
This structure must both perform the recited function and be
clearly linked to the function.
After identifying the claimed function, the court must
then determine what structure, if any, disclosed in the
specification corresponds to the claimed function. In order to
qualify as corresponding, the structure must not only perform
the claimed function, but the specification must clearly
associate the structure with performance of the function. This
inquiry is undertaken from the perspective of a person of
ordinary skill in the art. Alternative embodiments may disclose
different corresponding structure, and the claim is valid even if
only one embodiment discloses corresponding structure. If,
however, this inquiry reveals that no embodiment discloses
corresponding structure, the claim is invalid for failure to
satisfy the definiteness requirement of § 112, ¶ 2.
Cardiac Pacemakers, Inc. v. St. Jude Med., Inc., 296 F.3d 1106, 1113–14
(Fed. Cir. 2002) (citations omitted). This is a description for claim
construction requirement, not an enablement requirement. Knowledge of
one of ordinary skill cannot substitute for at least a minimal description of
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how the function is performed. This is because we need to use that
description to limit the scope of the limitation.
Enablement of a device requires only the disclosure of
sufficient information so that a person of ordinary skill in the
art could make and use the device. A section 112 paragraph 6
disclosure, however, serves the very different purpose of
limiting the scope of the claim to the particular structure
disclosed, together with equivalents.
EON Corp. IP Holdings LLC v. AT & T Mobility LLC, 785 F.3d 616, 624
(Fed. Cir. 2015) (quoting Aristocrat Techs. Austl. Pty Ltd. v. Int’l Game
Tech., 521 F.3d 1328, 1336 (Fed. Cir. 2008)). Thus, one of ordinary skill
does not enter into the requirement. “[A] person of ordinary skill in the art
plays no role whatsoever in determining whether an algorithm must be
disclosed as structure for a functional claim element.” Id. at 623. The
corresponding structure is that for performing the recited function(s) and
only those function(s). Other functions, such as those in a flowchart that
precede and follow the function, are not part of the corresponding structure.
The court must construe the function of a means-plus-function
limitation to include the limitations contained in the claim
language, and only those limitations. It is improper to narrow
the scope of the function beyond the claim language. It is
equally improper to broaden the scope of the claimed function
by ignoring clear limitations in the claim language. Ordinary
principles of claim construction govern interpretation of the
claim language used to describe the function.
Cardiac Pacemakers, 296 F.3d at 1113 (citation omitted).
For means plus function limitations, where the disclosed structure
is a computer programmed to implement an algorithm, the patent must
disclose enough of an algorithm to provide the necessary structure under
35 U.S.C. § 112 para. 6.
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The patentee may express this algorithm in any
understandable manner, including as a flowchart, so long as
sufficient structure is disclosed. “This court does not impose
a lofty standard in its indefiniteness cases.” Sufficient
structure must simply “permit one of ordinary skill in the art
to know and understand what structure corresponds to the
means limitation” so that he may “perceive the bounds of the
invention.”
In re Aoyama, 656 F.3d 1293, 1297–98 (Fed. Cir. 2011) (citations
omitted). There must be at least one structure actually disclosed, not
merely implied as being obvious to one of ordinary skill. Here no
structure is described.
The structure must be found only in that portion of the Specification
and drawings so clearly linked. “The Board erred by identifying
structure that was not clearly linked or associated by the specification or
prosecution history with the function actually recited in the claim.” Id. at
1297. Thus, we look only to the portions of the Specification and
drawings Appellant cites.
The specification can express the algorithm “in any understandable
terms including as a mathematical formula, in prose, or as a flow chart,
or in any other manner that provides sufficient structure.” Finisar, 523
F.3d at 1340 (citation omitted).
“Simply disclosing software, however, without providing some
detail about the means to accomplish the function, is not enough.” Noah
Sys., Inc. v. Intuit Inc., 675 F.3d 1302, 1312 (Fed. Cir. 2012) (internal
quotation marks and brackets omitted). The structure must be more than
recitations of the functions in black boxes without description of the
internal structure of those boxes. “For means-plus-function limitations
where the disclosed structure is a computer programmed to implement an
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algorithm, the patent must disclose enough of an algorithm to provide the
necessary structure under 35 U.S.C. § 112 ¶ 6.” Aoyama, 656 F.3d at
1297.
Simply disclosing a black box that performs the recited
function is not a sufficient explanation of the algorithm required
to render the means-plus-function term definite. The portion of
the specification that Augme asserts discloses “software code”
for assembling the second code module does no such thing. It
merely explains that “[c]ode assembler instructions” are
executed “to assemble a second code module.” Again, this is
nothing more than a black box.
Augme Techs., Inc. v. Yahoo! Inc., 755 F.3d 1326, 1337–38 (Fed. Cir. 2014)
(emphasis added) (citations omitted, alteration in original).
The structure so described must be adequate to perform the function.
Simply describing part of the structure, but not enough to perform the
function, and leaving the remainder to knowledge of one of ordinary skill is
not sufficient.5
Structure disclosed in the specification qualifies as
“corresponding structure” if the intrinsic evidence clearly links
or associates that structure to the function recited in the claim.
Even if the specification discloses corresponding structure, the
disclosure must be of “adequate” corresponding structure to
achieve the claimed function.
Williamson v. Citrix Online, LLC, 792 F.3d 1339, 1352 (Fed. Cir. 2015)
(citations omitted). It is only after some description of how the entire
function is performed, if only at a high level, that Section § 112, first
paragraph considerations may come into play as to sufficiency.

5 This is also a matter of common sense given the underlying policy. If
describing only part of the structure were permissible, a universal part of
most algorithmic structures, such as receiving or returning the input or
output data for the algorithm, would suffice and thus lead to purely
functional claiming.
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Where, as here, plural functions are recited, the specification must
describe how to perform each recited function.
Given the purpose for requiring disclosure of an algorithm in
special purpose computer implemented means-plus-function
claims, we conclude that where, as here, a claim recites
multiple identifiable functions and the specification discloses an
algorithm for only one, or less than all, of those functions, we
must analyze the disclosures as we do when no algorithm is
disclosed.
Noah Sys., 675 F.3d at 1318.
Claim 22, second limitation recites a means for performing two
functions, viz. receiving credit transaction data message from the protocol
translator and receiving credit transaction data message from the protocol
translator. Claim 52, second limitation recites similar functions in means
plus function format. Outside of using the term “means,” neither claim 22
nor claim 52 recites structure for performing these functions. Although
claim 52 goes on to recite “comprising an encryption system,” this is
followed by duplicate recitals of the two functions in the means plus
function. The word “encryption” in encryption system connotes function
rather than structure as it describes outcome and not process or physical
structure. Thus the second limitation of claim 52 is to be construed as means
plus function. The Specification does not lexicographically define
“encrypting,” but the customary meaning in a computer context is to alter
(data) using a mathematical algorithm so as to make the data unintelligible
to unauthorized users while allowing a user with a key or password to
convert the altered data back to its original state. We construe “encrypting”
accordingly as the altering of the data from unencrypted to encrypted form,
which does not include the prefatory or post-processing steps to such
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alteration. We construe “receiving” as its customary meaning of taking in,
prior to any subsequent data conversion that is not part of receiving as such.
Because the means plus function recited in claims 22 and 52 recites
two functions, supporting structure describing how to perform each function
must be found in the Specification and drawings. The Specification and
drawings nowhere describe structure for performing the first of the two
recited functions, receiving credit transaction data message from the
protocol translator, particularly at the locations Appellant cites.6 The
Specification nowhere describes structure for performing the second of the
two recited functions, encrypting the credit transaction data message,
particularly at the locations Appellant cites. Figure 7 shows only a black
box of each function and Figure 5 shows a black box that is described as
performing both functions. The attendant Specification sections do not
describe how to perform either function. They only describe labels of those
functions as being somehow performed within a broader context.
Appellant cites portions of the Specification that present several
results to be obtained, without describing how to achieve those results.
They provide no description of the structure within boxes 502, 702, and
704 and so have not described structure supporting the recited means that
perform each of the recited functions. The recitation of using a generic but
otherwise undescribed encryption algorithm or other suitable encryption
procedures and receiving an equally undescribed, generic encryption module
at Specification 16 does not describe structure. “’Module’ is a well-known

6 Appellant does not cite In re Katz Interactive Call Processing Patent Litig.,
639 F.3d 1303 (Fed. Cir. 2011) or otherwise contend that a generic computer
inherently contains a means for receiving data. We are therefore precluded
from making such a construction under Aoyama.
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nonce word that can operate as a substitute for “means” in the context of §
112, para. 6.” Williamson, 792 F.3d at 1350.
Thus, the Specification and drawings have no description of how
to perform the functions recited in the means plus function limitations.
As a result, it is impossible for anyone, including one of ordinary skill, to
construe the second limitation of claim 22 or 52.
Claims 22–28 and 52–63 rejected under 35 U.S.C. § 112, second paragraph
as failing to particularly point out and distinctly claim the invention
Initially, we agree with Appellant that claim 63 does not have a means
plus function limitation and so the rejection is improper for that claim.
As to the remaining claims, the precise issue before us is:
Does 35 U.S.C. §112, sixth paragraph require a description within the
four corners of the specification and drawings of how the recited functions
in means plus function limitations are performed as a necessary but not
necessarily sufficient predicate to construe a means plus function limitation,
and if so, whether the Specification and drawings contain that description.
We resolve that issue supra under Claim Construction. For the
reasons cited there, as a matter of law based on the underlying facts, no one
is able to construe the remaining claims 22–28 and 52–62. We need not
reach the issue of whether, if there were such a description, it would be
sufficient for one of ordinary skill. We determine there is no such
description however minimal.
It is unclear to us whether Appellant joins this issue and disagrees
with our conclusion, or instead argues that so long as one of ordinary skill
would be able to build or acquire some means for performing the function
that would be sufficient, or instead argues that a flow diagram containing a
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black box absent a description of how to perform for each function would be
sufficient. The problem with any of these theories is that one would still be
unable to construe the means plus function limitations, except in purely
functional terms, which is not allowed.
[S]ection 112, paragraph 6 incorporates a deliberate quid pro
quo: the patentee is allowed to claim a limitation in broad
functional language, “provided that the specification indicates
what structure constitutes the means for performing the claimed
function.” The indicated structure must limit the claim so as
not to allow pure functional claiming.
. . .
The claim would not be saved from pure functional claiming,
and thus indefiniteness, without reference to the algorithms set
forth in the specification, which are necessary to the
performance of those recited functions.
Dealertrack, Inc. v. Huber, 674 F.3d 1315, 1328–1329 (Fed. Cir. 2012)
(citation omitted).
That ordinarily skilled artisans could carry out the recited
function in a variety of ways is precisely why claims written in
“means-plus-function” form must disclose the particular
structure that is used to perform the recited function. By failing
to describe the means by which the access control manager will
create an access control list, Blackboard has attempted to
capture any possible means for achieving that end. Section 112,
paragraph 6, is intended to prevent such pure functional
claiming.
Blackboard, Inc. v. Desire2Learn, Inc., 574 F.3d 1371, 1385 (Fed.
Cir. 2009) (citing Aristocrat, 521 F.3d at 1333).
This rejection is premised on the requirement that, if the means is not
amenable to construction because no description for performing the recited
functions exists in the Specification and drawings, the claim must be
rejected as indefinite.
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After identifying the claimed function, the court must
then determine what structure, if any, disclosed in the
specification corresponds to the claimed function. In order to
qualify as corresponding, the structure must not only perform
the claimed function, but the specification must clearly
associate the structure with performance of the function. This
inquiry is undertaken from the perspective of a person of
ordinary skill in the art. Alternative embodiments may disclose
different corresponding structure, and the claim is valid even if
only one embodiment discloses corresponding structure. If,
however, this inquiry reveals that no embodiment discloses
corresponding structure, the claim is invalid for failure to
satisfy the definiteness requirement of § 112, ¶ 2.
Cardiac Pacemakers, 296 F.3d at 1113–14 (citations omitted). Thus, the
rejection as to those claims is proper.
We are not persuaded by Appellant’s argument that “the Office has
failed to rebut the affidavit evidence of Dr. Jay Kesan.”7 App. Br. 7
(emphasis omitted). This Declaration is afforded little to no evidentiary
weight. See Analysis for Determining Weight To Afford Declaration, infra.
Beyond the inaccuracies determined infra, the Declaration does not directly
mention, much less address, the issues of claim construction under 35 U.S.C.
§ 112, sixth paragraph. Most notably, the Declaration never makes findings
that the Specification and drawings describe performing the recited
functions, as required by 35 U.S.C. § 112, sixth paragraph. Instead, it only
states that portions are linked to, correspond to, or are associated with the
recited functions. While such a linkage is a judicially created requirement,
the requirement for describing how to perform the function is recited in the
statute itself.

7 This document is a declaration rather than an affidavit.
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The Declaration instead appears to make findings that one of ordinary
skill could find or program the functions, which is an enablement finding,
not a 35 U.S.C. § 112, sixth paragraph claim construction finding.8 The
Declaration tellingly never proffers a construction of the limitations under
35 U.S.C. § 112, sixth paragraph. Again, one of ordinary skill is not
relevant to the requirement for some description. See EON, supra. You
might take one of ordinary skill into account in determining how much detail
of this performance description is needed, but not in deciding whether a
complete description is needed in the first place. It is needed under 35
U.S.C. § 112, sixth paragraph to limit the scope of the construction, not to
inform one as to possession or how to make and use.
We are not persuaded by Appellant’s argument that “[t]he primary
flaw in the Prior Decision is the fixation on ‘boxes’ with ‘functions,’ while
failing to recognize that one of ordinary skill in the art would understand that
flow chart algorithms are necessarily depicted using ‘boxes’ with
‘functions.’” App. Br. 8. The use of boxes in flowcharts to document
algorithms and programs is well known. That is not the issue. The issue is
whether those boxes describe how to perform the recited function. A single
box does not. A single box with the name of the function, colloquially
referred to as a black box, is roughly equivalent to a null program without
content that only has the program name and placeholders for parameters
used by programmers to allow a program to compile before an
implementation has been programmed. It may be invoked, but not executed
other than to do nothing because there is nothing there. Just as there is no

8 Paragraph 12 of the Declaration mistakenly identifies that “the PTAB panel
asserts is non-enabling in this application.”
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implementing code in a null program, there is no implementing description
in a black box. That description of how to perform the function is a
requirement of 35 U.S.C. § 112, sixth paragraph. “[T]he fact that one of
skill in the art could program a computer to perform the recited functions
cannot create structure where none otherwise is disclosed.” Williamson, 792
F.3d at 1351.
Both Appellant and Declarant point to Figure 7 as structure associated
with the functions. It would appear, though not explicitly stated, that
Appellant might be arguing that Figure 7 is the description of the means for
performing the functions. But the structure in Figure 7, beyond the
receiving and encrypting black boxes, is not pertinent to the construction of
the means for performing those functions because the structure beyond the
boxes labelled with the recited functions includes functions beyond those
recited in the claim. The Figure 7 structure only invokes the functions, it
does not perform them. We look only at the recited functions for
corresponding structure, not other functions preceding and following the
functions. See Cardiac Pacemakers, supra.
We are not persuaded by Appellant’s argument that the Specification
describes using the ISO 8583 and VISA-K protocols. App. Br. 9. Again,
these are data mapping protocols, not data reception or encryption structures.
We are not persuaded by Appellant’s argument that there is no
explicit determination of the level of skill in the art. This is not pertinent
where there is no description for one to use in construing the claims as here.
No one can understand the metes and bounds of that which does not exist, as
in an un-construable limitation, no matter one’s level of skill. And the
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knowledge of one of ordinary skill cannot make up for a total lack of
description. See EON, supra.
We are not persuaded by Appellant’s argument that “there is explicit
and concrete evidence of record that the flow chart of Fig. 7 of the pending
application is an algorithm.” App. Br. 10. This is undisputed. That is not
the issue. As we determine supra, Figure 7 is an algorithm that invokes but
does not itself perform or describe how to perform the functions of
encrypting and receiving data. There simply is no encryption algorithm
described in the Specification and drawings, particularly where Appellant
points to. Fundamentally, the problem for Appellant’s argument is that
Figure 7 does not have a set of multiple such boxes, with unencrypted data
entering the first box and encrypted data leaving the last box and that
together describe how the unencrypted data is converted to encrypted data.
Neither does the Specification describe such a process in support of the
single box in Figure 7.
We are not persuaded by Appellant’s argument that “[n]either the
Prior Decision or the Office cites any factual support for its finding that the
flow chart algorithm of Fig. 7 does not provide algorithmic structure
corresponding to the means plus function limitations.” Id. Again, the
argument misses the point that Fig. 7 fails to describe how to perform
encryption. The argument only is that Figure 7 somehow has
correspondence with the recited function, which is undisputed. We do not
dispute the existence of the black boxes within the structure Figure 7
portrays. But, the black boxes do not describe how to perform what they do.
The remainder of Figure 7 is not pertinent to the construction analysis.
Findings supporting this are provided supra.
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The remaining arguments are again in support of enablement rather
than showing a description of performing the recited functions.
Recognizing that this analysis is far more comprehensive than that of
the Examiner, we denominate this rejection as a new ground to afford
Appellant an opportunity to respond, to either the Examiner or to us.

Claims 22–28 and 52–63 rejected under 35 U.S.C. § 101 as directed to a
judicial exception without significantly more
As a procedural matter, we reverse the rejection of claims 22–28
and 52–62 under § 101. A rejection of a claim, which is so indefinite
that “considerable speculation as to meaning of the terms employed and
assumptions as to the scope of such claims” is needed, is likely
imprudent. See In re Steele, 305 F.2d 859, 862 (CCPA 1962) (holding
that the examiner and the board were wrong in relying on what at best
were speculative assumptions as to the meaning of the claims and basing
a rejection under 35 U.S.C. § 103 thereon). We find it imprudent to
speculate as to the scope of claims 22–28 and 52–62 in order to reach a
decision on the eligibility of the claimed subject matter under § 101. It
should be understood, however, that our reversal is based on the
indefiniteness of the claimed subject matter and does not reflect on the
merits of the underlying rejection.
We now analyze claim 63.
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STEP 19
Claim 63, as an apparatus claim, nominally recites one of the
enumerated categories of eligible subject matter in 35 U.S.C. § 101. The
issue before us is whether it is directed to a judicial exception without
significantly more.
STEP 2
The Supreme Court
set forth a framework for distinguishing patents that claim laws
of nature, natural phenomena, and abstract ideas from those that
claim patent-eligible applications of those concepts. First, . . .
determine whether the claims at issue are directed to one of
those patent-ineligible concepts. If so, we then ask, “[w]hat
else is there in the claims before us? To answer that question,
. . . consider the elements of each claim both individually and
“as an ordered combination” to determine whether the
additional elements “transform the nature of the claim” into a
patent-eligible application. [The Court] described step two of
this analysis as 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.”
Alice Corp. v. CLS Bank Int’l, 573 U.S. 208, 217–18 (2014) (citations
omitted) (citing Mayo Collaborative Servs. v. Prometheus Labs., Inc.,
566 U.S. 66 (2012)). To perform this test, we must first determine what the
claims are directed to. This begins by determining whether the claims recite
one of the judicial exceptions (a law of nature, a natural phenomenon, or an
abstract idea). Then, if the claims recite a judicial exception, determining
whether the claims at issue are directed to the recited judicial exception, or

9 For continuity of analysis, we adopt the steps nomenclature from 2019
Revised Patent Subject Matter Eligibility Guidance, 84 Fed. Reg. 50 (Jan. 7,
2019) (“Revised Guidance”).
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whether the recited judicial exception is integrated into a practical
application of that exception, i.e., that the claims “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.” Revised Guidance, 84 Fed. Reg. at
54. If the claims are directed to a judicial exception, then finally
determining whether the claims provide an inventive concept because the
additional elements recited in the claims provide significantly more than the
recited judicial exception.
STEP 2A Prong 1
At a high level, and for our preliminary analysis, we note that claim
63 recites receiving data, forming data, receiving more data, and encrypting
data. Forming data is no more than creating data. Encrypting data is basic
conventional data processing. Thus, claim 63 recites receiving, creating, and
processing data. None of the limitations recites technological
implementation details for any of these steps, but instead they recite only
results desired by any and all possible means.
From this we see that claim 63 does not recite the judicial exceptions
of either natural phenomena or laws of nature.
Under Supreme Court precedent, claims directed purely to an abstract
idea are patent-ineligible. As set forth in the Revised Guidance, which
extracts and synthesizes key concepts identified by the courts, abstract ideas
include (1) mathematical concepts10, (2) certain methods of organizing

10 See, e.g., Gottschalk v. Benson, 409 U.S. 63, 71–72 (1972); Bilski v.
Kappos, 561 U.S. 593, 611 (2010); Mackay Radio & Tel. Co. v. Radio Corp.
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human activity11, and (3) mental processes12. Among those certain methods
of organizing human activity listed in the Revised Guidance are commercial
or legal interactions. Like those concepts, claim 63 recites the concept of
payment processing. Specifically, claim 63 recites operations that would
ordinarily take place in advising one to receive credit payment data to form
and encrypt a message. The advice to receive credit payment data to form
and encrypt a message involves receiving payment data, which is an
economic act, and encrypting a payment transaction, which is an act
ordinarily performed in the stream of commerce. For example, claim 63
recites “receive the credit transaction data” which is an activity that would
take place whenever one is making an electronic payment. Similarly, claim
63 recites “encrypt the credit transaction data message using an encryption
system,” which is also characteristic of secure payment processing.
The Examiner determines the claims to be directed to processing a
transaction message. Non-Final Act. 3.
The preamble to claim 63 recites that it is an apparatus for
transmitting credit transaction data over a communications medium. The
steps in claim 63 result in forming and encrypting a payment credit message

of Am., 306 U.S. 86, 94 (1939); SAP Am., Inc. v. InvestPic, LLC, 898 F.3d
1161, 1163 (Fed. Cir. 2018).
11 See, e.g., Bilski, 561 U.S. at 628; Alice, 573 U.S. at 219–20; Ultramercial,
Inc. v. Hulu, LLC, 772 F.3d 709, 715 (Fed. Cir. 2014); Smart Sys.
Innovations, LLC v. Chicago Transit Auth., 873 F.3d 1364, 1383 (Fed. Cir.
2017); In re Marco Guldenaar Holding B.V., 911 F.3d 1157, 1160–61 (Fed.
Cir. 2018).
12 See, e.g., Benson, 409 U.S. at 67; CyberSource Corp. v. Retail Decisions,
Inc., 654 F.3d 1366, 1371–72 (Fed. Cir. 2011); Intellectual Ventures I LLC
v. Symantec Corp., 838 F.3d 1307, 1318 (Fed. Cir. 2016).
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absent any technological mechanism other than a conventional computer for
doing so.
As to the specific limitations, limitations 1 and 2 recite receiving data.
Limitations 1 and 2 also recite generic and conventional creating and
processing of credit transaction data, which advise one to apply generic
functions to get to these results. The limitations thus recite advice for
receiving payment credit data to form and encrypt a message. To advocate
receiving payment credit data to form and encrypt a message is conceptual
advice for results desired and not technological operations.
The Specification at 1:23–27 describes the invention as relating to
transmitting credit transaction data that allows the credit transaction data to
be transmitted over a communications medium. Thus, all this intrinsic
evidence shows that claim 63 is directed to payment processing. This is
consistent with the Examiner’s determination.
This in turn is an example of commercial or legal interactions as a
certain method of organizing human activity because payment processing is
an activity for making payment in commercial transactions. The concept of
payment processing by receiving payment credit data to form and encrypt a
message is one idea for collecting and securely transmitting such data. The
steps performed by the functions recited in claim 63 are part of how this
might conceptually be premised.
Our reviewing court has found claims to be directed to abstract ideas
when they recited similar subject matter. Inventor Holdings, LLC v. Bed
Bath & Beyond, Inc., 876 F.3d 1372, 1377–78 (Fed. Cir. 2017) (local
processing of payments for remotely purchased goods).
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From this we conclude that at least to this degree, claim 63 is directed
to payment processing by receiving payment credit data to form and encrypt
a message, which is a commercial and legal interaction, one of certain
methods of organizing human activity identified in the Revised Guidance,
and, thus, an abstract idea.
STEP 2A Prong 2
The next issue is whether claim 63 not only recites, but is more
precisely directed to this concept itself or whether it is instead directed to
some technological implementation or application of, or improvement to,
this concept, i.e., integrated into a practical application.13
At the same time, we tread carefully in construing this
exclusionary principle lest it swallow all of patent law. At
some level, “all inventions ... embody, use, reflect, rest upon, or
apply laws of nature, natural phenomena, or abstract ideas.”
Thus, an invention is not rendered ineligible for patent simply
because it involves an abstract concept. “[A]pplication[s]” of
such concepts “ ‘to a new and useful end,’ ” we have said,
remain eligible for patent protection.
Accordingly, in applying the § 101 exception, we must
distinguish between patents that claim the “ ‘buildin[g]
block[s]’ ” of human ingenuity and those that integrate the
building blocks into something more.
Alice, 573 U.S. at 217 (citations omitted, alterations in original).
Taking the claim elements separately, the operation performed by the
computer at each step of the process is expressed purely in terms of results,
devoid of implementation details. The first parts of limitations 1 and 2
perform pure data gathering steps. Limitations describing the nature of the

13 See, e.g., Alice, 573 U.S. at 223, discussing Diamond v. Diehr, 450 U.S.
175 (1981).
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data do not alter this. The second part of limitations 1 and 2 recites basic
conventional data operations such as generating and encrypting data, which
are generic computer processing expressed in terms of results desired by any
and all possible means and so present no more than conceptual advice. All
purported inventive aspects reside in how the data is interpreted and the
results desired, and not in how the process physically enforces such a data
interpretation or in how the processing technologically achieves those
results. The limitation of using a protocol translator does not add any
technological implementation detail to the process. The Specification does
not lexicographically define a protocol translator. In one exemplary
embodiment the Specification describes it as a software module. Spec.
17:3–8. In another exemplary embodiment, the Specification describes it as
extracting data. Thus, the phrase “protocol translator” is no more than a
label for the module that does what the claim recites.
Viewed as a whole, Appellant’s claim 63 simply recites the concept of
payment processing by receiving payment credit data to form and encrypt a
message as performed by a generic computer. This is no more than
conceptual advice on the parameters for this concept and the generic
computer processes necessary to process those parameters, and does not
recite any particular implementation.
Claim 63 does not, for example, purport to improve the functioning of
the computer itself. Nor does it effect an improvement in any other
technology or technical field. The 24+ pages of specification only spell out
different generic equipment14 and parameters that might be applied using
this concept and the particular steps such conventional processing would

14 The Specification describes a single board computer. Spec. 7:16–22.
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entail based on the concept of payment processing by receiving payment
credit data to form and encrypt a message under different scenarios. They
do not describe any particular improvement in the manner a computer
functions. Instead, claim 63 at issue amounts to nothing significantly more
than an instruction to apply payment processing by receiving payment credit
data to form and encrypt a message using some unspecified, generic
computer. Under our precedents, that is not enough to transform an abstract
idea into a patent-eligible invention. See Alice, 573 U.S. at 225–26.
None of the limitations reflects an improvement in the functioning of
a computer, or an improvement to other technology or technical field,
applies or uses a judicial exception to effect a particular treatment or
prophylaxis for a disease or medical condition, implements a judicial
exception with, or uses a judicial exception in conjunction with, a particular
machine or manufacture that is integral to the claim, effects a transformation
or reduction of a particular article to a different state or thing, or 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.
We conclude that claim 63 is directed to achieving the result of
payment processing by advising one to receive credit payment data to form
and encrypt a message, as distinguished from a technological improvement
for achieving or applying that result. This amounts to commercial or legal
interactions, which fall within certain methods of organizing human activity
that constitute abstract ideas. The claim does not integrate the judicial
exception into a practical application.
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STEP 2B
The next issue is whether claim 63 provides an inventive concept
because the additional elements recited in the claim provide significantly
more than the recited judicial exception.
The introduction of a computer into the claims does not generally alter
the analysis at Mayo step two,
the mere recitation of a generic computer cannot transform a
patent-ineligible abstract idea into a patent-eligible invention.
Stating an abstract idea “while adding the words ‘apply it’” is
not enough for patent eligibility. Nor is limiting the use of an
abstract idea “‘to a particular technological environment.’”
Stating an abstract idea while adding the words “apply it with a
computer” simply combines those two steps, with the same
deficient result. Thus, if a patent’s recitation of a computer
amounts to a mere instruction to “implemen[t]” an abstract idea
“on … a computer,” that addition cannot impart patent
eligibility. This conclusion accords with the preemption
concern that undergirds our § 101 jurisprudence. Given the
ubiquity of computers, wholly 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.”
Alice, 573 U.S. at 223–24 (citations omitted, alterations in original).
“[T]he relevant question is whether the claims here do more than
simply instruct the practitioner to implement the abstract idea . . . on a
generic computer.” Alice, 573 U.S. at 225. They do not.
Taking the claim elements separately, the function performed by the
computer at each step of the process is purely conventional. Using a
computer for receiving, creating, and processing data amounts to electronic
data query and retrieval—one of the most basic functions of a computer. All
of these computer functions are generic, routine, conventional computer
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activities that are performed only for their conventional uses. See Elec.
Power Grp., LLC v. Alstom S.A., 830 F.3d 1350, 1353 (Fed. Cir. 2016). See
also In re Katz Interactive Call Processing Patent Litig., 639 F.3d 1303,
1316 (Fed. Cir. 2011) (“Absent a possible narrower construction of the terms
‘processing,’ ‘receiving,’ and ‘storing,’ . . . those functions can be achieved
by any general purpose computer without special programming”). None of
these activities is used in some unconventional manner nor do any produce
some unexpected result. Appellant does not contend it invented any of these
activities. In short, each step does no more than require a generic computer
to perform generic computer functions. The limitation of “from two or more
point of sale systems according to two or more different transmission
protocols, each transmission protocol associated with a different credit
authorization system” is not a step, but a recitation of the origin of the
received data. As to the data operated upon, “even if a process of collecting
and analyzing information is ‘limited to particular content’ or a particular
‘source,’ that limitation does not make the collection and analysis other than
abstract.” SAP Am., Inc., 898 F.3d at 1168.
Considered as an ordered combination, the computer components of
Appellant’s claim 63 add nothing that is not already present when the steps
are considered separately. The sequence of data reception-creation-
processing is equally generic and conventional. See Ultramercial, 772 F.3d
at 715 (sequence of receiving, selecting, offering for exchange, display,
allowing access, and receiving payment recited an abstraction), Inventor
Holdings, 876 F.3d at 1378 (sequence of data retrieval, analysis,
modification, generation, display, and transmission), Two-Way Media Ltd. v.
Comcast Cable Commc’ns, LLC, 874 F.3d 1329, 1339 (Fed. Cir. 2017)
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(sequence of processing, routing, controlling, and monitoring). The ordering
of the steps is therefore ordinary and conventional.
We conclude that claim 63 does not provide an inventive concept
because the additional elements recited in the claim do not provide
significantly more than the recited judicial exception.
REMAINING CLAIMS
Claim 63 is the only claim remaining at issue. We conclude that
claim 63 at issue is directed to a patent-ineligible concept itself, and not to
the practical application of that concept. As a corollary, the claim is not
directed to any particular machine.
LEGAL CONCLUSION
From these determinations we further determine that the claims do not
recite an improvement to the functioning of the computer itself or to any
other technology or technical field, a particular machine, a particular
transformation, or other meaningful limitations. From this we conclude the
claims are directed to the judicial exception of the abstract idea of certain
methods of organizing human activity as exemplified by the commercial and
legal interaction of payment processing by advising one to receive credit
payment data to form and encrypt a message, without significantly more.
APPELLANT’S ARGUMENTS
As to Appellant’s Appeal and Reply Brief arguments, all of them
contend that the Examiner failed to properly construe the limitations under
35 U.S.C. § 112, sixth paragraph. Claim 63 has no such means plus function
limitation, and none of the arguments is directed to claim 63.
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Recognizing that this analysis is far more comprehensive than that of
the Examiner, we denominate this rejection as a new ground to afford
Appellant an opportunity to respond, to either the Examiner or to us.
Claims 22–28 and 52–63 rejected under 35 U.S.C. § 103(a) as unpatentable
over Kramer and Dickerman
As a procedural matter, we reverse the rejection of claims 22–28
and 52–62 under § 103. A rejection of a claim, which is so indefinite that
“considerable speculation as to meaning of the terms employed and
assumptions as to the scope of such claims” is needed, is likely
imprudent. See In re Steele, 305 F.2d at 862 (holding that the examiner
and the board were wrong in relying on what at best were speculative
assumptions as to the meaning of the claims and basing a rejection under
35 U.S.C. § 103 thereon). We find it imprudent to speculate as to the
scope of claims 22–28 and 52–62 in order to reach a decision on the
obviousness of the claimed subject matter under § 103(a). It should be
understood, however, that our reversal is based on the indefiniteness of
the claimed subject matter and does not reflect on the merits of the
underlying rejection.
As to claim 63, the Examiner did not provide a separate analysis
for us to consider.
Analysis for Determining Weight To Afford Declaration
Appellant proffers a Declaration to support the rebuttal argument.
Before responding to such arguments, we first determine how much weight
to afford the Declaration.
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We first look at Declarant’s assertion that the rejection is not based
on findings of fact. Declaration para. 7. In the Prior Decision 10–11, we
determined that
Appellants cite reference 702 and 704 of Figure 7 and the
associated description at page 21, line 25 to page 22, line 15
of the Specification as describing the structure corresponding
to the claim 22 means for receiving the credit transaction
data message from the protocol translator and encrypting the
credit transaction data message. Br. 6, 10. References 702
and 704 are black boxes in a flow chart that are titled as each
of the functions recited in the means at issue. The attendant
Specification portions cited describe reference 702 as the
function of credit transaction data being received and
reference 704 as the function of the credit transaction data
being assembled into an authorization request and encrypted.
The description that the data can be received with suitable
protocols and encrypted with an updateable encryption
module add no structural information or limitation to the
receiving and encrypting functions.
These are sufficient findings to support the rejection. Further
findings of fact beyond this are recited at Prior Decision 10–11. To the
extent these findings are not explicitly labelled as such, there is no
requirement for such labelling. Their status as findings of fact is
apparent on their face as statements that are determinable as true or
untrue based on the underlying evidence. Thus this assertion by
Declarant is shown to be erroneous.
We next look at Declarant’s assertion that an actual issue on appeal
in Aoyama was the finding of fact by the PTAB panel in that matter that
a disclosed flow chart could never be an algorithm. Declaration para. 13.
There is no such finding of fact in Ex parte Aoyama, Appeal No. 2015-
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010303 (PTAB 2015). This is evidenced by the Federal Circuit’s
Decision.
The Board did not purport to announce that a flowchart
can never, under any circumstances, provide sufficient structure
to satisfy § 112 ¶ 6. . . . Instead, the Board simply concluded
that the particular flowchart of Figure 8 and its accompanying
description fail to provide any structure or algorithm
whatsoever. . . .
This court agrees with the Board’s conclusion that Figure
8 “fails to describe, even at a high level, how a computer could
be programmed to produce the structure that provides the
results described in the boxes.”
Aoyama, 656 F.3d at 1298 (citations omitted).
The phrase “flow charts” occurs 3 times in the Aoyama final decision.
Once in describing Aoyama’s Fig. 8. Aoyama Final Dec. 6. Once in “fails
to describe receiving warehouse and distribution inventory data, comparing
warehouse and distribution center data, and determining whether to transfer
product as in the Fig. 8 flowchart.” Aoyama Final Dec. 14. Once in “[t]he
flowchart in the Appellants’ Fig. 8 implicitly acknowledges this dichotomy
my presenting the generation in boxes separate from the decisions.”
Aoyama Final Dec. 14–15.
The phrase “flowchart” or “flow diagram” occurs twice in the Aoyama
Decision on Request for Reconsideration. Once in “Appellants contend our
construction was in error, that the means is the flow diagram of process 800
shown in Figure 8 of the application and its equivalents,” Aoyama Dec.
Req. Reh’g. 3. Once in “[t]he Specification describes Figure 8 as ‘a
flowchart of a method 800 for reverse logistics’ (Specification ¶ 0088).”
Aoyama Dec. Req. Reh’g. 4.
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The word “flow” occurs otherwise in Aoyama Final Decision 7 FF 4
reciting the Yang reference, and in Aoyama Decision on Request for
Rehearing “While Figure 8 provides a diagram of high level process flow, it
does not describe any structure that would alter a general purpose computer
into a special purpose computer. It fails to describe, even at a high level,
how a computer could be programmed to produce the structure that provides
the results described in the boxes, since the essential structural
implementation detail is omitted.” Id. at 4.
None of these assert or imply that a disclosed flow chart could
never be an algorithm. Thus this assertion by Declarant is shown to be
erroneous.
We next look at Declarant’s assertion that “the references . . . have the
same type of flow chart algorithms and level of detail that the PTAB panel
asserts is non-enabling in this application.” Declaration para. 12. There is
no enablement rejection in that Prior Decision, and no word with the root
“enable” exists in the Prior Decision. Thus this assertion by Declarant is
shown to be erroneous.
With this level of inaccuracy as to statements the Declarant further
states he knows or believes to be true (Declaration para. 15), we determine
the credibility to attach to the Declaration is low and so the facts the
Declaration describes should be given little to no evidentiary weight.
Attorney argument in the Declaration is not evidence of fact. More
critically, all of the proposed findings other than 5, 9, and 10 support
enablement rather than a description of performance. The proposed fact
findings are:
The level of skill in the art would be a person with a four year
degree and a few years of experience programming computers
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in response to requirements from non-technical personnel
(proposed FF01).
The requirements for software that are usually provided to such
persons of ordinary skill by persons who require the software
are often purely functional and without any structure (proposed
FF02).
A person of ordinary skill in the art would be able to program
the claimed functionality with even de minimis structure
(proposed FF03).
The pending application provides much more than that level of
structure (proposed FF04).
The flow chart algorithm of Fig. 7 shows one way, which is to
first receive the credit transaction message from the protocol
translator, such as in a message sent from the protocol
translator, and then to directly encrypt the credit transaction
data message after it is received (proposed FF05).
However, there are a number of different ways to implement
that function other than using the disclosed algorithm (proposed
FF06).
For example, one way would be to extract the credit transaction
data from memory, instead of receiving it from a protocol
translator, and then to directly encrypt the credit transaction
data after it is received (proposed FF07).
Another range of options would be to extract the credit
transaction data from memory and then perform a function on
the credit transaction data, and then to directly encrypt the
credit transaction data after performing the function, where the
function could include any number of additional algorithms,
such as parsing algorithms, mathematical operators, conversion
algorithms or the like (proposed FF08).
The specification states that the credit transaction data can
include a credit card number, amount, and other suitable credit
transaction data, and can be received (1) in accordance with the
ISO 8583 protocol, the VISA-K protocol, or other suitable
protocols. If the credit transaction data is received from one of
two or more point of sale systems or other devices, then (2) the
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Application 11/818,693

40

credit transaction data can be mapped to allow authorization
data that is sent in response to an authorization request to be
matched with the corresponding point of sale system (proposed
FF09).
These different alternatives provide additional algorithmic
structures that are clearly linked to the claimed function and
which describe how to achieve the results that are to be
obtained to one of ordinary skill in the art (proposed FF10).
Declaration paras. 8–10. Proposed finding of fact 5 describes invoking, but
not performing the functions. Proposed finding of fact 9 refers only to the
means for receiving and not to the means for encrypting, and the protocols
described map rather than receive data. Proposed finding of fact 10 is
conclusory and the prior evidence it is founded on does not support its
conclusion. Thus, even these proposed facts are not pertinent to the issue of
whether the means in the claims are amenable to construction.
As to the weight to be given to the Declarant’s background and
experience, although Declarant declares he was a Thomas A. Edison scholar
at the USPTO, this is to say he was asked to spend up to six months on
special projects with the USPTO, not that he has any particular expertise in
the esoterica of construction under 35 U.S.C. § 112, sixth paragraph. The
Office’s description of his activity during his tenure does not suggest such
expertise or activity.
Our third Edison Scholar, [Declarant] of the University of
Illinois, focused primarily on research related to international
patent harmonization. Specifically, [Declarant] studied how the
grace period available under 35 USC § 102 relates to the
disclosure of useful information, and the pace and impact of
cumulative innovation. [Declarant] also contributed empirical
research related to patent law changes, as well as issues related
to innovation, technology transfer, and the IP transactional
environment. An additional focus of [Declarant]’s work was
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41

investigating how to develop a standardized set of metrics
associated with patent office quality, and identifying
circumstances in which such a set of metrics may improve
prospects for international work-sharing.
Director’s Forum: A Blog from USPTO’s Leadership.15
As to the attorney arguments in the Declaration, the Declarant does
not appear to be an attorney of record in the case. We address the
Appellant’s attorney’s arguments instead, supra.
CONCLUSIONS OF LAW
The rejection of claims 22–28 and 52–62 under 35 U.S.C. § 101 as
directed to a judicial exception without significantly more is improper.
The rejection of claim 63 under 35 U.S.C. § 101 as directed to a
judicial exception without significantly more is proper. This is denominated
as a new ground under 37 C.F.R. § 41.50(b).
The rejection of claims 22–28 and 52–62 under 35 U.S.C. § 112,
second paragraph as failing to particularly point out and distinctly claim the
invention is proper. This is denominated as a new ground under 37 C.F.R.
§ 41.50(b).
The rejection of claim 63 under 35 U.S.C. § 112, second paragraph as
failing to particularly point out and distinctly claim the invention is
improper.

15 Rea, The USPTO Thomas Alva Edison Visiting Scholars Program
Celebrates its First Year, February 8, 2013,
https://www.uspto.gov/blog/director/entry/the_uspto_thomas_alva_edison
See also USPTO Establishes Thomas Alva Edison
Visiting Scholars Program, February 16, 2012, https://www.uspto.gov
/about-us/news-updates/uspto-establishes-thomas-alva-edison-visiting-
scholars-program
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The rejection of claims 22–28 and 52–63 under 35 U.S.C. § 103 as
unpatentable over Kramer and Dickerman is improper.

CONCLUSION
The rejection of claims 22–28 and 52–63 is affirmed.
In summary:
Claims
Rejected
35 U.S.C. § Basis Affirmed Reversed New
Ground
22–28,
52–63
101 Eligibility 63 22–28, 52–62 63
22–28,
52–63
112, second
paragraph
Indefiniteness 22–28,
52–62
63 22–28,
52–62
22–28,
52–63
103 Kramer,
Dickerman
22–28, 52–63
Overall
Outcome
22–28,
52–63
22–28,
52–63

Our decision is not a final agency action.
This decision contains a new ground of rejection pursuant to 37
C.F.R. § 41.50(b). Section 41.50(b) provides “[a] new ground of rejection
pursuant to this paragraph shall not be considered final for judicial review.”
Section 41.50(b) also provides:
When the Board enters such a non-final decision, the appellant,
within two months from the date of the decision, must exercise
one of the following two options with respect to the new ground
of rejection to avoid termination of the appeal as to the rejected
claims:
(1) Reopen prosecution. Submit an appropriate
amendment of the claims so rejected or new Evidence relating
to the claims so rejected, or both, and have the matter
reconsidered by the examiner, in which event the prosecution
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will be remanded to the examiner. The new ground of rejection
is binding upon the examiner unless an amendment or new
Evidence not previously of Record is made which, in the
opinion of the examiner, overcomes the new ground of rejection
designated in the decision. Should the examiner reject the
claims, appellant may again appeal to the Board pursuant to this
subpart.
(2) Request rehearing. Request that the proceeding be
reheard under § 41.52 by the Board upon the same Record. The
request for rehearing must address any new ground of rejection
and state with particularity the points believed to have been
misapprehended or overlooked in entering the new ground of
rejection and also state all other grounds upon which rehearing
is sought.
Further guidance on responding to a new ground of rejection can
be found in the Manual of Patent Examining Procedure § 1214.01.
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) (2011).

AFFIRMED; 37 C.F.R. § 41.50(b)

Notice of References Cited

Application/Control No.

Applicant(s)/Patent Under Patent
Appeal No.
Examiner

Art Unit

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M US-
FOREIGN PATENT DOCUMENTS

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Dates in MM-YYYY format are publication dates. Classifications may be US or foreign.

U.S. Patent and Trademark Office
PTO-892 (Rev. 01-2001) Notice of References Cited Part of Paper No.

UNITED STATES PATENT AND TRADEMARK OFFICE 1
___________ 2
3
BEFORE THE BOARD OF PATENT APPEALS 4
AND INTERFERENCES 5
___________ 6
7
Ex parte KEISUKE AOYAMA, KOJIRO TOYOSHIMA, and 8
YOSHITAKA EZAKI 9
___________ 10
11
Appeal 2009-006755 12
Application 10/798,505 13
Technology Center 3600 14
___________ 15
16
Decided: November 17, 2009 17
___________ 18
19
Before MURRIEL E. CRAWFORD, HUBERT C. LORIN, and ANTON W. 20
FETTING, Administrative Patent Judges. 21
FETTING, Administrative Patent Judge. 22
DECISION ON APPEAL 23
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2
STATEMENT OF THE CASE 1
Keisuke Aoyama, Kojiro Toyoshima, and Yoshitaka Ezaki (Appellants) 2
seek review under 35 U.S.C. § 134 (2002) of a final rejection of claims 11-3
14, 21-36, and 38, the only claims pending in the application on appeal. 4
We have jurisdiction over the appeal pursuant to 35 U.S.C. § 6(b) 5
(2002). 6
SUMMARY OF DECISION1 7
We AFFIRM-IN-PART. 8
THE INVENTION 9
The Appellants invented a way of distribution change management that 10
allows a single entity to control distribution through warehouses controlled 11
by multiple entities. (Specification 1:¶ 001). 12
An understanding of the invention can be derived from a reading of 13
exemplary claims 11 and 26, which are reproduced below [bracketed matter 14
and some paragraphing added]. 15
11. A system for supply chain management comprising: 16

1 Our decision will make reference to the Appellants’ Appeal Brief (“App.
Br.,” filed February 23, 2007) and Reply Brief (“Reply Br.,” filed February
3, 2009), and the Examiner’s Answer (“Answer,” mailed December 24,
2008).
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[1] an order controller system 1
including reverse logistics means for generating transfer 2
data; and 3
[2] a warehouse system 4
receiving the transfer data and generating shipping data. 5
26. A method for supply chain management comprising: 6
[1] receiving 7
warehouse inventory data and 8
distribution center inventory data and 9
generating reverse logistics data 10
to modify a distribution of inventory at a first warehouse 11
and a second warehouse; 12
[2] receiving the reverse logistics data 13
at a first warehouse system and 14
generating shipping data; and 15
[3] receiving the reverse logistics data 16
at a second warehouse system and 17
generating shipping data. 18
THE REJECTIONS 19
The Examiner relies upon the following prior art: 20
Yang US 2001/0034673 A1 Oct. 25, 2001
Singh US 2002/0169657 A1 Nov. 14, 2002
Claims 26-36 and 38 stand rejected under 35 U.S.C. § 101 as directed to 21
non-statutory subject matter. 22
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Claims 11-14, 21-24, 26, and 31 stand rejected under 35 U.S.C. § 102(a) 1
as anticipated by Yang. 2
Claims 25, 27-30, and 32-36 stand rejected under 35 U.S.C. § 103(a) as 3
unpatentable over Yang and Singh. 4
Claim 38 stands rejected under 35 U.S.C. § 103(a) as unpatentable over 5
Yang. 6
ARGUMENTS 7
Claims 26-36 and 38 rejected under 35 U.S.C. § 101 as directed to non-8
statutory subject matter. 9
The Examiner raised this rejection for the first time in the Answer at 3-5, 10
finding that these claims failed the Bilski machine or transformation test. 11
The Appellants argue that the claims require the use of data processing 12
equipment and transform the location of inventory. Reply Br. 9-13. 13
Claims 11-14, 21-24, 26, and 31 rejected under 35 U.S.C. § 102(a) as 14
anticipated by Yang. 15
The Appellants argue several limitations as missing from Yang in claims 16
11-13, 21-24, 26, and 31. The principal argument regarding independent 17
claims 11 and 26 is with regard to the reverse logistics means and data. 18
App. Br. 11-18. 19
Claims 25, 27-30, and 32-36 rejected under 35 U.S.C. § 103(a) as 20
unpatentable over Yang and Singh. 21
Claim 38 rejected under 35 U.S.C. § 103(a) as unpatentable over Yang. 22
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The Appellants argue the Examiner failed to present a prima facie basis 1
for these rejections. App. Br. 18-22). 2
3
ISSUES 4
The issue of whether the Appellants have sustained their burden of 5
showing that the Examiner erred in rejecting claims 26-36 and 38 under 35 6
U.S.C. § 101 as directed to non-statutory subject matter turns on whether the 7
claims transform something or are tied to a particular machine or apparatus. 8
The issue of whether the Appellants have sustained their burden of 9
showing that the Examiner erred in rejecting claims 11-14, 21-24, 26, and 31 10
under 35 U.S.C. § 102(a) as anticipated by Yang turns on the construction of 11
reverse logistics means and whether Yang describes the argued limitations. 12
The issues of whether the Appellants have sustained their burden of 13
showing that the Examiner erred in rejecting claims 25, 27-30, and 32-36 14
under 35 U.S.C. § 103(a) as unpatentable over Yang and Singh and in 15
rejecting claim 38 under 35 U.S.C. § 103(a) as unpatentable over Yang turn 16
on the construction of reverse logistics means and whether the claims were 17
predictable to one of ordinary skill in view of the art. 18
FACTS PERTINENT TO THE ISSUES 19
The following enumerated Findings of Fact (FF) are believed to be 20
supported by a preponderance of the evidence. 21
Facts Related to Claim Construction 22
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01. The disclosure contains no lexicographic definition of “reverse 1
logistics.” 2
Facts Related to Appellants’ Disclosure 3
02. Figure 8 is a flowchart of a method 800 for reverse logistics in 4
accordance with an exemplary embodiment. Specification ¶ 0088. 5
Figure 8 contains a series of decision boxes each containing a 6
decision of whether to transfer product and if so, transferring 7
control to a box to generate shipping data. 8
03. There is no structure or algorithm for generating transfer data 9
disclosed in the discussion of Figure 8 at Specification 10
paragraphs’ 0088-93. These paragraphs do discuss generating 11
shipping data, but again without disclosing any structure or 12
algorithm for doing so. 13
04. The only disclosed apparatus for generating shipment data or 14
for receiving inventory data is a system for supply chain 15
management. Specification ¶ 0006. This shipping data can be 16
generated by order controller systems, warehouse systems and 17
distribution systems. Specification ¶ 0027. 18
05. The shipping data can be generated based upon order data, 19
order allocation data to warehouses, inventory data, and other 20
suitable data. Specification ¶ 0069. Thus, the basis for generating 21
shipping data is open ended. 22
Facts Related to the Prior Art 23
Yang 24
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06. Yang is directed to electronic commercial transactions and in 1
particular to an electronic marketplace providing service parts 2
inventory planning and management. Yang ¶ 0002. 3
07. Yang specifically describes reverse logistics. Yang describes a 4
growing requirement for many enterprises as the ability to better 5
manage the "reverse logistics" flow of service parts that are 6
defective or are otherwise returned for replacement or repair. The 7
flow of such aftermarket service parts may often provide a 8
valuable source of re-salable service parts, potentially reducing the 9
need to purchase or manufacture new service parts. Enterprises 10
which effectively manage reverse logistics flows can reduce their 11
costs significantly. Yang ¶ 0004. 12
08. Yang uses a parts inventory management system to control 13
parts inventory at many locations. Parts are transferred among 14
stocking locations to meet planned inventory needs. Yang’s 15
system receives inventory level data at one or more stocking 16
locations in a supply chain. Yang ¶ 0007. 17
09. Yang’s supply chain includes those that use, manufacture, 18
distribute or sell parts. Yang ¶ 0008. 19
10. Yang describes a "reverse logistics" or other returns supply 20
chain as used for eventual insertion of parts back into a supply 21
chain. Yang ¶ 0021. 22
11. Yang describes how excess inventory and inventory needed to 23
meet plans can be transferred among inventory stocking locations. 24
Yang ¶ 0037. 25
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12. Where traceability is important, traceability documents are 1
provided for parts transfers. Yang ¶ 0043. 2
13. Yang describes maintaining inventories and other information 3
for distribution centers and customer supply chains. Yang ¶ 0036. 4
14. Yang describes iterating inventory transfers until stocking 5
levels at one or more stocking locations within the supply chain 6
are consistent with the optimal inventory plan. Yang ¶ 0053. 7
15. Yang describes how an internal distribution network of a supply 8
chain forms an internal warehouse hierarchy. The lower levels of 9
the warehouse hierarchy place demands on higher levels. There is 10
often a need to move inventory between distribution centers 11
within the supply chain to offset needs using excesses. 12
Distribution centers may need to be replenished from outside the 13
internal warehouse hierarchy of distributor if a distribution center 14
at a first level cannot meet the demand from one or more 15
distribution centers at a second higher level. Distribution centers 16
at the second level may need to procure service parts from outside 17
supply chain due to the lack of supply from the distribution center 18
at the first level. A primary difference between reliance on other 19
distribution centers within the supply chain and reliance on such 20
"out-of-network" sources is the lack of visibility into and control 21
over inventory associated with the "out-of-network" sources. 22
Yang ¶ 0019-20. 23
Singh 24
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16. Singh is directed to supply chain planning and demand 1
forecasting for proactively predicting demand across multiple 2
levels of the supply chain so as to avoid costly mismatches of 3
demand and supply. Singh ¶ 0002. 4
17. Singh describes taking new product promotions into 5
consideration for planning inventory levels. Singh ¶’s 0080 – 82. 6
Facts Related To The Level Of Skill In The Art 7
18. Neither the Examiner nor the Appellants have addressed the 8
level of ordinary skill in the pertinent arts of systems analysis and 9
programming, inventory controls systems and distribution system 10
design. We will therefore consider the cited prior art as 11
representative of the level of ordinary skill in the art. See Okajima 12
v. Bourdeau, 261 F.3d 1350, 1355 (Fed. Cir. 2001) (“[T]he 13
absence of specific findings on the level of skill in the art does not 14
give rise to reversible error ‘where the prior art itself reflects an 15
appropriate level and a need for testimony is not shown’”) 16
(quoting Litton Indus. Prods., Inc. v. Solid State Sys. Corp., 755 17
F.2d 158, 163 (Fed. Cir. 1985). 18
19. One of ordinary skill knew that any inventory management 19
system that tracked parts at various locations necessarily had to 20
document transfers or shipments among locations to accurately 21
maintain inventory data. 22
PRINCIPLES OF LAW 23
Patentable Subject Matter – Statutory Processes 24
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The law in the area of patent-eligible subject matter for process claims 1
has recently been clarified by the Federal Circuit in, In re Bilski, 545 F.3d 2
943, 950-952 (Fed. Cir. 2008) (en banc), cert. granted, 77 USLW 3442 3
(U.S. Jun. 1, 2009) (NO. 08-964). 4
The en banc court in Bilski held that "the machine-or-transformation test, 5
properly applied, is the governing test for determining patent eligibility of a 6
process under 101." Bilski, 545 F.3d at 956. The court in Bilski further held 7
that "the 'useful, concrete and tangible result' inquiry is inadequate [to 8
determine whether a claim is patent-eligible under 101.]" Bilski, 545 F.3d at 9
959-60. 10
The court explained the machine-or-transformation test as follows: "A 11
claimed process is surely patent-eligible under 101 if: (1) it is tied to a 12
particular machine or apparatus, or (2) it transforms a particular article into a 13
different state or thing." Bilski, 545 F.3d at 954 (citations omitted). The court 14
explained that "the use of a specific machine or transformation of an article 15
must impose meaningful limits on the claim's scope to impart patent-16
eligibility" and "the involvement of the machine or transformation in the 17
claimed process must not merely be insignificant extra-solution activity." 18
Bilski, 545 F.3d at 961- 62 (citations omitted). As to the transformation 19
branch of the inquiry, the court explained that transformation of a particular 20
article into a different state or thing "must be central to the purpose of the 21
claimed process." Id. 22
Anticipation 23
"A claim is anticipated only if each and every element as set forth in the 24
claim is found, either expressly or inherently described, in a single prior art 25
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reference." Verdegaal Bros. v. Union Oil Co. of California, 814 F.2d 628, 1
631 (Fed. Cir. 1987). "When a claim covers several structures or 2
compositions, either generically or as alternatives, the claim is deemed 3
anticipated if any of the structures or compositions within the scope of the 4
claim is known in the prior art." Brown v. 3M, 265 F.3d 1349, 1351 (Fed. 5
Cir. 2001). "The identical invention must be shown in as complete detail as 6
is contained in the ... claim." Richardson v. Suzuki Motor Co., 868 F.2d 7
1226, 1236 (Fed. Cir. 1989). The elements must be arranged as required by 8
the claim, but this is not an ipsissimis verbis test, i.e., identity of terminology 9
is not required. In re Bond, 910 F.2d 831, 832 (Fed. Cir. 1990). 10
Obviousness 11
A claimed invention is unpatentable if the differences between it and 12
the prior art are “such that the subject matter as a whole would have been 13
obvious at the time the invention was made to a person having ordinary skill 14
in the art.” KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398, 406 (2007); Graham 15
v. John Deere Co., 383 U.S. 1, 13-14 (1966). 16
In Graham, the Court held that that the obviousness analysis is 17
bottomed on several basic factual inquiries: “[(1)] the scope and content of 18
the prior art are to be determined; [(2)] differences between the prior art and 19
the claims at issue are to be ascertained; and [(3)] the level of ordinary skill 20
in the pertinent art resolved.” Graham, 383 U.S. at 17. See also KSR, 550 21
U.S. at 406. “The combination of familiar elements according to known 22
methods is likely to be obvious when it does no more than yield predictable 23
results.” KSR, 550 U.S. at 416. 24
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ANALYSIS 1
Claims 26-36 and 38 rejected under 35 U.S.C. § 101 as directed to non-2
statutory subject matter. 3
We apply the machine-or-transformation test, as described in Bilski, to 4
determine whether the subject matter of process claims 26-36 and 38 are 5
patent-eligible under 35 U.S.C. § 101. 6
Process claims 26-36 and 38 recite a series of process steps that are not 7
tied in any manner to a machine. In other words, these claims do not limit 8
the process steps to any specific machine or apparatus. Each of the steps 9
receives and generates data. The steps do not recite any machine or 10
algorithm for receiving and generating such data. The Appellants argue that 11
the claims require the use of data processing equipment (Reply Br. 10), but 12
no such equipment is recited in the claims. Thus, the claims fail the first 13
prong of the machine-or-transformation test because they are not tied to a 14
particular machine or apparatus. The steps of these process claims also fail 15
the second prong of the machine-or-transformation test because the data 16
does not represent physical and tangible objects.2 Rather, the data represents 17
information about inventory, which is an asset category rather than any 18
specific physical item. Inventory data may be no more than item identifiers, 19
which themselves are intangible. Thus, the processes of claims 26-36 and 20
38 fail the machine-or-transformation test and are not patent-eligible under 21
35 U.S.C. § 101. 22

2 Because the data does not represent physical and tangible objects, we need
not reach the issue of whether mere calculation of a number based on inputs
of other numbers is a sufficient “transformation” of data to render a process
patent-eligible under § 101.
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1
2
3
Claims 11-14, 21-24, 26, and 31 rejected under 35 U.S.C. § 102(a) as 4
anticipated by Yang. 5
Claim 11. 6
The Appellants argue that Yang fails to describe a reverse logistics 7
means as described by process 800 in the Specification. Claim 11 specifies 8
that the reverse logistic means is for generating transfer data. This limitation 9
is expressed as a means plus function, and the Appellants have confirmed 10
that the limitation is to be construed as such. App. Br. 12-13. 11
The first step in construing a means-plus-function claim 12
limitation is to define the particular function of the claim 13
limitation. Budde v. Harley-Davidson, Inc., 250 F.3d 1369, 14
1376 (Fed.Cir.2001). “The court must construe the function of a 15
means-plus-function limitation to include the limitations 16
contained in the claim language, and only those limitations.” 17
Cardiac Pacemakers, Inc. v. St. Jude Med., Inc., 296 F.3d 1106, 18
1113 (Fed.Cir.2002). [] Ordinary principles of claim 19
construction govern interpretation of this claim language, see 20
id., []. 21
The next step in construing a means-plus-function claim 22
limitation is to look to the specification and identify the 23
corresponding structure for that function. “Under this second 24
step, ‘structure disclosed in the specification is “corresponding” 25
structure only if the specification or prosecution history clearly 26
links or associates that structure to the function recited in the 27
claim.’ ” Med. Instrumentation & Diagnostics Corp. v. Elekta 28
AB, 344 F.3d 1205, 1210 (Fed.Cir.2003) (quoting B. Braun 29
Med. Inc. v. Abbott Labs., 124 F.3d 1419, 1424 (Fed.Cir.1997)). 30
31
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Golight Inc. v. Wal-Mart Stores Inc., 355 F.3d 1327, 1333-34 (Fed. Cir. 1
2004). 2
3
The reverse logistics means then must be construed to cover the 4
corresponding structure, material, or acts described in the specification and 5
equivalents for performing the recited function, viz. generating transfer data. 6
The claim does not further narrow the nature of the transfer data, nor the 7
manner of generation. The Appellants cite the disclosure regarding 8
reference 800 in Fig. 8 and paragraphs 0088-93 in the Specification as 9
showing the support for the claimed me Answer App. Br. 7 and 13. We 10
construe the function of generating transfer data according to its plain 11
meaning, which is creating data concerned with some transfer. 12
We agree that Fig. 8 portrays an exemplary embodiment of a reverse 13
logistics method. FF 02. However, the only disclosure related to generating 14
transfer data is the set of steps labeled as generating shipping data. FF 02 - 15
03. The disclosed structure for generating shipping data is a system for 16
supply chain management that might contain order controller, warehouse, or 17
distribution systems for generating such shipping data. FF 04. Thus the 18
issue is whether Yang describes such a system for generating shipping data. 19
The Appellants argue that Yang fails to describe receiving warehouse 20
and distribution inventory data, comparing warehouse and distribution center 21
data, and determining whether to transfer product as in the Fig. 8 flowchart. 22
All of these functions argued by the Appellants are beyond generating 23
transfer data, and thus “are superfluous to our claim construction analysis 24
because they are not required for performing the claimed function.” Id. 25
While these functions may decide which data to generate, they are separate 26
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15
from the function of generating that data once decided. The flowchart in the 1
Appellants’ Fig. 8 implicitly acknowledges this dichotomy my presenting 2
the generation in boxes separate from the decisions. 3
The Examiner found that Yang described a reverse logistics process in 4
an inventory management system. Answer 5. We agree that Yang describes 5
an inventory management system (FF 08) and a reverse logistics process 6
with that system (FF 07 & 10). Parts are transferred among locations within 7
the system according to decisions based on planned needs and actual levels. 8
FF 08 & 11. One of ordinary skill knew that any inventory management 9
system that tracked parts at various locations had to document transfers or 10
shipments among locations. FF 19. Thus, we agree with the Examiner that 11
Yang described a reverse logistics process in a distribution system that had 12
structure equivalent to that disclosed in the Specification for generating 13
transfer data. As this is the only issue argued with regard to claim 11, this is 14
dispositive. 15
Claims 12 and 21. 16
Claim 12 further requires a distribution system receiving the transfer 17
data and generating shipping data. The Examiner found that Yang’s 18
inventory management system did so. Answer 6. The Appellants argue that 19
Yang’s reverse logistics data is not transfer data. The Appellants first 20
contend that reverse logistics within the claims is defined as process 800. 21
App. Br. 13. We do not agree, since the Specification provides no definition 22
of reverse logistics (FF 01) and the reverse logistics process shown as 23
reference 800 in Fig. 8 is an exemplary embodiment only. FF 02. 24
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The Appellants further contend that the reverse logistics disclosed is 1
hierarchical where Yang is not and that Yang fails to disclose structure that 2
facilitates product rollout. App. Br. 13-14. The pertinence of these 3
arguments is unknown since nothing in claim 12 refers to hierarchical 4
structures or product rollouts. Thus, we must disagree with the Appellants. 5
Claim 21 is another independent claim that again contains the reverse 6
logistics means limitation as in claim 11, but whose function also includes 7
receiving warehouse inventory data and distribution center inventory data. 8
As with generating data, the structure disclosed for receiving data is a 9
system for supply chain management that might contain an order controller, 10
a warehouse, or distribution systems. FF 04. As we found with claim 11, 11
Yang describes this. The Appellants again argue the absence of a 12
hierarchical distribution system (App. Br. 14) which is not pertinent in view 13
of the lack of any claim limitation regarding hierarchy. 14
Claim 13. 15
Claim 13 further requires the order controller system having an internal 16
warehouse order system receiving the shipping data and modifying internal 17
warehouse order data in response to the shipping data. The Examiner found 18
that Yang’s inventory management system did so. Answer 6. The 19
Appellants argue that Yang does not describe internal warehouses. App. Br. 20
14. We do not agree, since Yang describes multiple inventory locations (FF 21
08) and any inventory location warehouses inventory at that location. 22
Claims 14 and 22-24. 23
Claims 14 and 24 further require receiving the shipping data and 24
modifying inventory data in response to the shipping data. The Examiner 25
Appeal 2009-006755
Application 10/798,505

17
found that Yang’s inventory management system did so. Answer 6 & 7. The 1
Appellants repeat their argument that Yang does not describe hierarchical 2
distribution (App. Br. 15-16) which is not pertinent in view of the lack of 3
any claim limitation regarding hierarchy. 4
Claims 14 and 22-24. 5
Claims 14 and 22-24 further require receiving the shipping data and 6
modifying inventory data in response to the shipping data. The Examiner 7
found that Yang’s inventory management system did so. Answer 6-7. The 8
Appellants repeat their argument that Yang does not describe hierarchical 9
distribution (App. Br. 15-16) which is not pertinent in view of the lack of 10
any claim limitation regarding hierarchy. 11
Claims 26 and 31. 12
The Appellants argue that Yang fails to describe warehouse or 13
distribution center inventory data, two separate generations of shipping data, 14
use of reverse logistics to generate shipping data, or even a warehouse in 15
independent method claim 26. App. Br. 16-17. The Examiner found that 16
Yang’s inventory management system did so. Answer 7-8. 17
The Appellants’ arguments appear to rely on two premises: (1) that the 18
reverse logistics data is generated in response to receiving warehouse 19
inventory data and distribution center data and that shipping data is 20
generated in response to reverse logistics data and (2) that Yang fails to 21
describe such transactions at a warehouse, being a long term storage facility. 22
We agree with the Examiner that the features upon which Appellant 23
relies, viz. the reverse logistics data generated in response to receiving data 24
and shipping data generated in response to reverse logistics data, are not 25
Appeal 2009-006755
Application 10/798,505

18
recited in claim 26. Although the claims are interpreted in light of the 1
specification, limitations from the specification are not read into the claims. 2
See In re Van Geuns, 988 F.2d 1181, 1184-5 (Fed. Cir. 1993). Although 3
limitation [1] recites receiving warehouse and distribution center data and 4
generating reverse logistics data, nothing in that limitation recites any causal 5
connection between the two operations. Similarly, although limitations [2] 6
and [3] recite receiving reverse logistics data and generating shipping data, 7
nothing in those limitations recites any causal connection between the two 8
operations. 9
Clearly any reverse logistics data used by Yang to record receipts of 10
inventory requires accessing, i.e. receiving inventory quantity data to be 11
updated, fulfilling limitation [1], and any shipping data used to update 12
inventory data requires some inventory movement transaction that 13
necessitated the shipment. This sequence in Yang of receiving the inventory 14
data prior to generating reverse logistics data also answers the Appellants’ 15
follow up argument that Yang fails to use this sequence. Reply Br. 13. For 16
those transactions that involved Yang’s reverse logistics data, such reverse 17
logistics data are the transactional records to record that inventory 18
movement and which necessitate shipping data to record the movement, thus 19
fulfilling limitations [2] and [3]. 20
As to any distinction between a warehouse and a distribution center, 21
there is none so defined in the Specification. The Appellants cite 22
Specification ¶ 0056 (App. Br. 17), but this paragraph merely describes an 23
exemplary embodiment of a distribution system. Certainly, Yang describes 24
stocking locations (FF 08) used by manufacturers, distribution centers and 25
customers. FF 07 - 08. Stocking locations at customers, manufacturers and 26
Appeal 2009-006755
Application 10/798,505

19
users would generally be considered warehouses, as they warehouse stock at 1
such locations. Yang also describes distribution centers. FF 13. Yang’s 2
system maintains transactions among various entities including these 3
stocking locations at customers, users, manufacturers, and distribution 4
centers. Yang also describes creating multiple shipments among stocking 5
locations. FF 14. Thus, Yang describes limitation [1] of receiving 6
warehouse and distribution center inventory data and limitations [2] and [3] 7
of generating shipping data. In those instances that the transaction involves 8
parts returns, Yang creates reverse logistics data. FF 07. Although the 9
Appellants contend the Examiner misconstrued the term reverse logistics 10
data (App. Br. 16), Yang explicitly recites using reverse logistics that creates 11
data for updating inventory levels. FF 07. Again, claim 26 recites no 12
specific connection between the reverse logistics data and the inventory data 13
and shipping data. Thus, we conclude that the Examiner did not err in 14
rejecting claim 26. 15
Claim 31 further requires giving priority in maintaining predetermined 16
inventory levels at a warehouse that is operated by an operator of a supply 17
chain management system relative to warehouses not so operated. The 18
Examiner found that Yang uses an internal warehouse and only looks to an 19
external warehouse when supply is unavailable internally. Answer 8. The 20
Appellants argue that this does not describe maintaining inventory levels at a 21
first relative to a second warehouse. Reply Br. 15. The Appellants appear to 22
be contending that because claim 31 incorporates the two warehouses from 23
claim 26, an external warehouse is irrelevant to the claim. 24
We agree with the Appellants. Yang’s system would not provide reverse 25
logistics information and create shipping information for a warehouse 26
Appeal 2009-006755
Application 10/798,505

20
outside the system, if only by definition of a system. Thus, we agree with the 1
Appellants that as to this rejection, the inclusion of claim 31 was in error. 2
Claims 25, 27-30, and 32-36 rejected under 35 U.S.C. § 103(a) as 3
unpatentable over Yang and Singh. 4
Although the Appellants argue each of these claims individually, the 5
arguments are largely repeated among all these claims. These claims are 6
marked by the introduction of promotional product data, particularly for new 7
product roll outs. The Examiner applied Singh for these limitations. We 8
find that Singh does in fact describe taking new product promotions into 9
consideration for planning inventory levels. FF 17. The Appellants argue 10
that Singh is not directed to supply chain management and that neither 11
reference describes retail locations. App. Br. 18-21. As to whether Singh is 12
directed to supply chain management, 13
Claim 38 rejected under 35 U.S.C. § 103(a) as unpatentable over Yang. 14
Claim 38 further requires using regularly scheduled vehicles to transfer 15
inventory. The Examiner took official notice of the practice of using such 16
vehicles. Ans.10-11. The Appellants argue that it is not the use of such 17
vehicles per se that is the key limitation, but rather the limitations of claim 18
26, from which claim 38 depends. Reply Br. 21. We agree with the 19
Examiner that the use of regularly scheduled vehicles is notoriously well 20
known and was a predictable mode of transport, even for deliveries that were 21
unplanned, because the virtue of regular scheduling is that there will always 22
be a regularly scheduled vehicle available some time after an unplanned 23
need arises. As to claim 26, we found the Appellants’ argument 24
unpersuasive supra. 25
Appeal 2009-006755
Application 10/798,505

21
CONCLUSIONS OF LAW 1
The Appellants have not sustained their burden of showing that the 2
Examiner erred in rejecting claims 26-36 and 38 under 35 U.S.C. § 101 as 3
directed to non-statutory subject matter. 4
The Appellants have not sustained their burden of showing that the 5
Examiner erred in rejecting claims 11-14, 21-24, and 26 under 35 U.S.C. § 6
102(a) as anticipated by Yang. 7
The Appellants have sustained their burden of showing that the 8
Examiner erred in rejecting claim 31 under 35 U.S.C. § 102(a) as anticipated 9
by Yang. 10
The Appellants have not sustained their burden of showing that the 11
Examiner erred in rejecting claims 25, 27-30, and 32-36 under 35 U.S.C. § 12
103(a) as unpatentable over Yang and Singh. 13
The Appellants have not sustained their burden of showing that the 14
Examiner erred in rejecting claim 38 under 35 U.S.C. § 103(a) as 15
unpatentable over Yang. 16
DECISION 17
To summarize, our decision is as follows. 18
• The rejection of claims 26-36 and 38 under 35 U.S.C. § 101 as 19
directed to non-statutory subject matter is sustained. 20
• The rejection of claims 11-14, 21-24, and 26 under 35 U.S.C. § 102(a) 21
as anticipated by Yang is sustained. 22
Appeal 2009-006755
Application 10/798,505

22
• The rejection of claim 31 under 35 U.S.C. § 102(a) as anticipated by 1
Yang is not sustained. 2
• The rejection of claims 25, 27-30, and 32-36 under 35 U.S.C. § 103(a) 3
as unpatentable over Yang and Singh is sustained. 4
• The rejection of claim 38 under 35 U.S.C. § 103(a) as unpatentable 5
over Yang is sustained. 6
No time period for taking any subsequent action in connection with this 7
appeal may be extended under 37 C.F.R. § 1.136(a)(1)(iv). 8
9
AFFIRMED-IN-PART 10
11
12
13
mev 14
Address 15
MR. CHRISTOPHER JOHN ROURK 16
JACKSON WALKER LLP 17
901 MAIN STREET, SUITE 6000 18
DALLAS TX 75202 19

UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE BOARD OF PATENT APPEALS
AND INTERFERENCES
____________

Ex parte KEISUKE AOYAMA,
KOJIRO TOYOSHIMA, and
YOSHITAKA EZAKI
___________

Appeal 2009-006755
Application 10/798,505
Technology Center 3600
___________

Decided: June 16, 2010
___________

Before MURRIEL E. CRAWFORD, HUBERT C. LORIN, and ANTON W.
FETTING, Administrative Patent Judges.
FETTING, Administrative Patent Judge.

DECISION ON REQUEST FOR REHEARING
Appeal 2009-006755
Application 10/798,505

2
STATEMENT OF THE CASE1
On Jan. 19, 2010, Keisuke Aoyama, Kojiro Toyoshima, and Yoshitaka
Ezaki (Appellants) filed a Request for Rehearing under 37 C.F.R. § 41.52
directed to the rejection of claim 11 on the grounds of anticipation in the
Decision on Appeal (mailed Nov. 17, 2009).2 As the same issue argued is
present in independent claim 21, we take this request to implicitly be
directed to that claim and to the claims 12-14 and 22-24 that depend from
claims 11 and 21 as well.
ARGUMENT
The Appellants argue that the Board misconstrued the reverse logistics
means for generating transfer data in claims 11 and 21. The Appellants
content that the entire process 800 shown in Figure 8 of the application
described the structure that supports the recited means. Request 5.
ISSUE
Did the Board misapprehend the Specification in construing the reverse
logistics means for generating transfer data in claims 11 and 21?

1 Our decision will make reference to the Appellants’ Request for Rehearing
(“Request,” filed Jan. 19, 2010) and the Board of Patent Appeals and
Interferences’ Decision (“Decision,” mailed Nov. 17, 2009), and the
Appellants’ Specification (“Spec.,” filed Mar. 11, 2004).

2 The Request does not challenge the decision to affirm the Examiner’s
rejection of claims 26-36 and 38 under 35 U.S.C. § 101 as directed to non-
statutory subject matter. Decision 21. Nor does the Request challenge the
decision to affirm the Examiner’s rejection of claims 25, 27-30, and 32-36
under 35 U.S.C. § 103(a) as unpatentable over Yang and Singh and claim 38
over Yang alone, and of the process claims 26 and 31 under 35 U.S.C.
§ 102(a) as anticipated by Yang. Decision 21-22.
Appeal 2009-0066755
Application 10/798,505

3
BACKGROUND
In the Decision, we affirmed the Examiner’s rejection of claims 11-14
and 21-24 as anticipated by Yang. Decision 21. The two independent
claims 11 and 21 each recite a reverse logistics means for generating transfer
data. We found that Yang anticipated this element based on our construction
of the means as a system for supply chain management that might contain
order controller, warehouse, or distribution systems for generating such
shipping data from the description in the Specification. Decision 13-15.
The Appellants contend our construction was in error, that the means is the
flow diagram of process 800 shown in Figure 8 of the application and its
equivalents, and that the means construed as such is not anticipated by Yang.
Request 3.
DISCUSSION
As the issue raised by the Appellants is the construction of the reverse
logistics means for generating transfer data, we cite the Decision at 13-14 for
the details of that construction.
The Appellants initially argue that the Board did not respond to the
Appellants’ arguments regarding the Examiner’s failure to perform the
analysis required for construing a means plus function claim limitation.
Request 2. The Examiner provided the required analysis at Answer 13-15,
in which the Examiner construed the reverse logistics means for generating
transfer data as “any combination of hardware and/or software programmed
to perform this [generating transfer data] functionality.” Id. at 14-15.
We agreed with the Examiner’s analysis and construction and further
found that the Specification also describes this structure as a system for
Appeal 2009-0066755
Application 10/798,505

4
supply chain management that might contain order controller, warehouse, or
distribution systems for generating shipping data. Decision 14.
The Appellants next argue that the Examiner’s and the Board’s
construction is erroneous because Process 800 in Figure 8 is the means for
generating transfer data. Request 2-3. We disagree with the Appellants that
what is depicted as process 800 in Figure 8 describes the structure to
perform the function of generating transfer data3, and described in
Specification ¶’s 0088-93. Process 800 is not described as an algorithm for
generating transfer data, nor does it show how to generate transfer data.
The Specification describes Figure 8 as “a flowchart of a method 800 for
reverse logistics” (Specification ¶ 0088). The Specification does not
describe or define what reverse logistics is other than to mention it is used
“to optimize the cost of goods, shipping costs, to accommodate promotions,
product rollout, product deletions, product replacements, or to perform other
suitable functions” (id.). This does not describe how method 800 or reverse
logistics applies to generating transfer data.
While Figure 8 provides a diagram of high level process flow, it does not
describe any structure that would alter a general purpose computer into a
special purpose computer. It fails to describe, even at a high level, how a
computer could be programmed to produce the structure that provides the
results described in the boxes, since the essential structural implementation

3 The phrases “generating transfer data” and “transfer data” are not defined
and do not occur in the Specification. These phrases were introduced for the
first time into the claims in amendments filed January 4, 2006. The
Appellants point to no portion of the Specification or Drawings that use
these phrases.
Appeal 2009-0066755
Application 10/798,505

5
detail is omitted. Instead, the diagram pictorially presents several results to
be obtained, without describing how to achieve those results, and certainly
not how to generate transfer data.
The Appellants next argue that generating transfer data is what the
various blocks in Figure 8 do at Request 4. The Appellants cite no portion
of the Specification or drawings to support this argument. Thus, the
Appellants start from the premise that Figure 8 portrays an algorithmic
structure (of something undefined called reverse logistics), and conclude that
this structure corresponds to the recited means for generating transfer data,
for which no support is found in the disclosure. We have accordingly
considered the Appellants’ arguments, and conclude that Process 800 in
Figure 8 does not describe and cannot be the means for generating transfer
data.
Accordingly, we maintain that the only structure described in the
disclosure for performing the function recited in claim 11 is a system for
supply chain management that includes order controller, warehouse and
distributions systems or their equivalents. Accordingly, we see no error in
the prior Decision for affirming the rejection of claims 11-14 and 21-24 as
anticipated by Yang.
CONCLUSION
We have considered the Appellants’ Request for Rehearing.
For the foregoing reasons, we find it unpersuasive as to error in the
Decision to sustain the rejection of claims 11-14 and 21-24 under 35 U.S.C.
§ 102(a), as being anticipated by Yang, and the Request for Rehearing of the
rejection of claims 11-14 and 21-24 under 35 U.S.C. § 102(a), as being
Appeal 2009-0066755
Application 10/798,505

6
anticipated by Yang is denied. No arguments regarding the remaining
claims and rejections are made and therefore the decision as to those claims
and rejections also stands.
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).

DENIED

mev

Mr. Christopher John Rourk
Jackson Walker LLP
901 Main Street, Suite 6000
DALLAS TX 75202
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USPTO Establishes Thomas Alva Edison
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Washington - The United States Patent and Trademark Office (USPTO) today
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Property and Director of the USPTO David Kappos. "We would certainly benefit
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universities to achieve the full potential of this unique and historic opportunity."
" am honored to undertake the inaugural Edison visitorship," Thomas said. "The enthusiasm, leadership, and
professionalism of USPTO management have truly motivated me and am grateful for the opportunity to contribute
to the crucial work of this agency."
Since , Jay Thomas has served as a visiting scholar at the Congressional Research Service. n that capacity he
assisted members of Congress and their staff during the enactment of such legislation as the American nventors
Protection Act and the America nvents Act. Thomas previously clerked for Chief Judge Helen Nies of the Court of
Appeals for the Federal Circuit. He has been a member of the faculties of Cornell, George Washington University, and
the University of Tokyo, and also served as a visiting scholar at the Max Planck nstitute in Munich, Germany, and the
nstitute of ntellectual Property in Tokyo, Japan. Thomas is the author or co-author of numerous articles and six
books on intellectual property law, including a leading patents casebook co-authored with Professor Martin Adelman
and Chief Judge Randall Rader of the Federal Circuit. He holds a B.S. from Carnegie Mellon in Computer Engineering,
a J.D. magna cum laude from the University of Michigan, and an LL.M. with highest honors from George Washington
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