Ryan Hagey et al.

Patent Trials and Appeals Board

Sep 23, 2019

13648849 - (D) (P.T.A.B. Sep. 23, 2019)

UNITED STATES PATENT AND TRADEMARK OFFICE
UNITED STATES DEPARTMENT OF COMMERCE
United States Patent and Trademark Office
Address: COMMISSIONER FOR PATENTS
P.O. Box 1450
Alexandria, Virginia 22313-1450
www.uspto.gov
APPLICATION NO. FILING DATE FIRST NAMED INVENTOR ATTORNEY DOCKET NO. CONFIRMATION NO.
13/648,849 10/10/2012 Ryan Hagey 8223-1706980 (64US02) 3136
144885 7590 09/23/2019
The Webb Law Firm / Visa International
ONE GATEWAY CENTER
420 FT. DUQUESNE BLVD, SUITE 1200
PITTSBURGH, PA 15222
EXAMINER
NGUYEN, THUY N
ART UNIT PAPER NUMBER
3681
NOTIFICATION DATE DELIVERY MODE
09/23/2019 ELECTRONIC
Please find below and/or attached an Office communication concerning this application or proceeding.
The time period for reply, if any, is set in the attached communication.
Notice of the Office communication was sent electronically on above-indicated "Notification Date" to the
following e-mail address(es):
patents@webblaw.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________

Ex parte RYAN HAGEY,
MARGARET REID,
JOSEPH BJORN OVICK,
MARK CARLSON,
PATRICK STAN,
PATRICK WRIGHT,
KRIS KOGANTI,
and GLENN POWELL
____________

Appeal 2018-0024241
Application 13/648,8492
Technology Center 3600
____________

Before ANTON W. FETTING, AMEE A. SHAH, and
MATTHEW S. MEYERS, Administrative Patent Judges.

FETTING, Administrative Patent Judge.

DECISION ON APPEAL

1 The record includes a transcript of the oral hearing held August 19, 2019.
2 According to Appellants, the real party in interest is Visa International
Service Association (Appeal Br. 2).

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STATEMENT OF THE CASE3
Ryan Hagey, Margaret Reid, Joseph Bjorn Ovick, Mark Carlson,
Patrick Stan, Patrick Wright, Kris Koganti, and Glenn Powell (Appellants)
seek review under 35 U.S.C. § 134(a) of a final rejection of claims 1, 6, 8–
18, and 20, the only claims pending in the application on appeal. We have
jurisdiction over the appeal pursuant to 35 U.S.C. § 6(b).
Appellants invented a way of processing of payment transactions,
such as payments made via credit cards, debit cards, prepaid cards, etc., and
the redemption of the benefits of offers, such as coupons, deals, discounts,
rewards, etc. Specification para. 3.
An understanding of the invention can be derived from a reading of
exemplary claim 1, which is reproduced below (bracketed matter and some
paragraphing added).
1. A computer-implemented method, comprising:
[0] providing a computing apparatus comprising:
[0.1] a transaction handler configured in an electronic
payment processing network that connects separate
computers, including:
[0.1.1] transaction terminals configured to generate
transactions of payments made using identifiers of
accounts in the electronic payment processing
network;

3 Our Decision will make reference to Appellants’ Appeal Brief (“App. Br.,”
filed June 27, 2017) and Reply Brief (“Reply Br.,” filed January 02, 2018),
and the Examiner’s Answer (“Ans.,” mailed November 2, 2017), and Final
Action (“Final Act.,” mailed January 27, 2017).
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[0.1.2] first computers controlling the accounts
from which the payments are made in the
electronic payment processing network;
[0.1.3] the transaction handler configured to
process the transactions in the electronic payment
processing network;
and
[0.1.4] second computers controlling accounts in
which the payments transactions are received in
the electronic payment processing network;
[0.2] a data warehouse coupled with the transaction
handler and storing:
[0.2.1] an offer in association with an account of a
user, wherein the offer identifies an amount of
discount, and
[0.2.2] a trigger record specifying:
[0.2.2.1] a set of conditions, and
[0.2.2.2] an action, wherein the set of
conditions is a subset of requirements for
redemption of the offer, and the action
identifies the offer;
and
[0.3] a portal configured to communicate with the
transaction terminals using one or more communication
paths that are outside the electronic payment processing
network for authorization of the transactions;
[1] detecting, by the transaction handler using the trigger
record, an authorization request for a transaction in the account
of the user that satisfies the requirements for redemption of the
offer, by:
[1.1] receiving, in the transaction handler, authorization
requests communicated in the electronic payment
processing network for the transactions, including the
authorization request for the transaction in the account of
the user;
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[1.2] checking, by the transaction handler, each of the
authorization requests to be processed by the transaction
handler against the set of conditions specified in the
trigger record;
[1.3] and for each respective authorization request that
satisfies the set of conditions specified in the trigger
record, performing the action specified in the trigger
record for the respective authorization request,
wherein the action specified in the trigger record
causes the system to further determine whether the
requirements for redemption of the offer are
satisfied in entirety;
[1.4] wherein the authorization request for [a] transaction
in the account of the user specifies an original transaction
amount of the transaction initiated on a transaction
terminal in the electronic payment processing network;
[2] in response to the transaction in the account of user that
satisfies the requirements for redemption of the offer being
detected via the trigger record, performing further operations by
the transaction handler as a result of performing the action
specified in the trigger record, wherein the further operations
include:
[2.1] computing a modified transaction amount from the
original transaction amount specified in the authorization
request and the amount of discount identified by the
offer, and
[2.2] replacing in the authorization request, by the
transaction handler, the original transaction amount with
the modified transaction amount to generate a modified
authorization request identifying the modified transaction
amount as if the modified authorization request were
initially received in the transaction handler for the
modified transaction amount;
[2.3] transmitting, by the transaction handler in the
electronic payment processing network, the modified
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authorization request to a computer among the first
computers that controls the account of the user;
[2.4] and providing, by the transaction handler, an
authorization response for the transaction to the
transaction terminal, wherein the authorization response
is configured to authorize the modified transaction
amount and include information that causes the
transaction terminal to query the portal about the offer;
[2.5] receiving, in the portal from the transaction
terminal, a query generated using the information
provided in the authorization response;
and
[2.6] communicating, by the portal in response to the
query, details of the offer to the transaction terminal for
display.
The Examiner relies upon the following prior art:
White US 2008/0133351 A1 June 5, 2008
Hammad US 2009/0271262 A1 Oct. 29, 2009
Salmon US 2011/0066483 A1 Mar. 17, 2011
Winters US 2011/0087531 A1 Apr. 14, 2011
Main US 7,933,800 B2 Apr. 26, 2011
Claims 1, 6, 8–18, and 20 stand rejected under 35 U.S.C. § 101 as
directed to a judicial exception without significantly more.
Claims 1, 6, 8–18, and 20 stand rejected under 35 U.S.C. § 103(a) as
unpatentable over White, Hammad, Salmon, Main, and Winters.
ISSUES
The issues of eligible subject matter turn primarily on whether the
claims recite more than abstract conceptual advice of results desired.
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The issues of obviousness turn primarily on whether the art describes
all limitations.
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 disclosure contains no lexicographic definition of “trigger
record.”
Facts Related to Appellants’ Disclosure
02. In one embodiment, a trigger record is configured to determine
whether the transaction handler is to check the offer for the
application of the offer. When the account information provided
in the authorization request and/or other information as identified
in the authorization request, such as the identity of the merchant
operating the transaction terminal, satisfies the requirement of the
trigger record, the trigger record instructs the transaction handler
to determine the applicability of the offer to the transaction for
which the authorization request is submitted (or for which the
authorization response is provided). The use of the trigger record
to trigger the transaction handler to check the applicability of the
offer improves the efficiency of the transaction handler by
optimized requirement checking operations relative to the trigger
records and by filtering out transactions that do not meet the
requirements of the trigger records. Spec. para. 267.
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Facts Related to the Prior Art
White
03. White is directed to payment systems, and in particular,
processing rewards at the point of interaction (e.g., such as at
point of sale (“POS”) locations). White para. 2.
04. White describes one or more rewards programs funded in
whole or in part by one or more entities (e.g., one or more
merchants, issuers, payment systems, payment processors, or
product manufacturers) are implemented via a payment
transaction authorization network. A rewards system computer
and/or a reward data source is associated with the payment
transaction authorization network. The rewards system
computer and/or the reward data source store information
that defines the rewards programs, including information
indicating which purchase transactions qualify for rewards,
merchant and acquirer information identifying qualifying
transactions, the amounts of the rewards, and any reward
messaging to be delivered to the point of interaction for
communication to the customer. In some embodiments, the
rewards system computer and/or the reward data source also store
information associated with individual reward accounts, including,
for example, the reward point balance associated with each
account. White para. 20.
05. White describes a reward data source in communication with
authorization systems and a rewards system. Reward data source
stores data identifying payment card accounts participating in one
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or more reward programs associated with authorization systems,
as well as details about those reward programs. White para. 35.
Hammad
06. Hammad is directed to split messaging in the context of a
payment transaction or the like. Hammad para. 8.
Salmon
07. Salmon is directed to a transaction with a merchant on an
account held by an account holder, and more particularly relates to
a rebate on the transaction. Salmon para. 2.
Main
08. Main is directed to a coupon including a bar code and a list.
Main 1:50–51.
Winters
09. Winters is directed to processing of transaction data, such as
records of payments made via credit cards, debit cards, prepaid
cards, etc., and/or providing information based on the processing
of the transaction data. Winters para. 2.
ANALYSIS
Initially we construe the limitation “trigger record” because although
on its face, the term describes a record modified by the word “trigger,” how
such modification manifests is not immediately apparent. There is no
lexicographic definition. Claim 1 does not recite how the record is
structured or used as a record, but only what it contains, viz, data describing
a set of conditions and an action. According to the Specification, this data is
used to determine whether the transaction handler is to check an offer for the
application of the offer. The data in the record specifies criteria that, when
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met, leads the process to perform the action also recited in the record, which
includes further checking for promotion applicability. The action is itself
left as generic, except that it includes further selection criteria checking.
The manner and implementation of specifying this data is itself unspecified.
It may be no more than a code that specifies data scattered among other
records. In such a case, it would be hard to find efficiencies. Thus, a trigger
record is a record containing data describing course filter criteria, that when
met, lead the process to further refine the selection process. It is not a record
that itself triggers or performs something, but only a record that contains
data. That data, when read, is used to determine whether some further step
will be performed. It is in that sense the record is characterized as a trigger
record. We construe a trigger record as a record containing data describing
criteria and some action.
Claims 1, 6, 8–18, and 20 rejected under 35 U.S.C. § 101 as directed to a
judicial exception without significantly more
STEP 14
Claim 1, as a method 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, . . .

4 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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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
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
53. 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 method
claim 1 recites detecting and checking authorization requests, performing
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some generic action when a request meets criteria on a trigger record,
computing a modified transaction amount and replacing the original amount
with the computed amount, transmitting the modified request, providing a
response, receiving a query, and communicating data. Detecting and
checking are rudimentary forms of data analysis. Performing a generic
action is conventional data processing. Computing an amount is
mathematical analysis. Replacing data is data updat[ing]. Providing and
communicating data are transmitting data. Thus, claim 1 recites receiving,
analyzing, processing, updating, and transmitting data. None of the
limitations recite technological implementation details for any of these steps,
but instead recite only results desired by any and all possible means. There
is an additional prefatory step of providing a computing apparatus, but this is
no more than reciting the computer context for the steps recited. The
limitations listed under this step are high level functional descriptions of
what software modules in the computer would provide, and so only serve to
recite labels for the software that perform the subsequent steps.
From this we see that claim 1 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 in-eligible. As set forth in the Revised Guidance, which
extracts and synthesizes key concepts identified by the courts, abstract ideas
include (1) mathematical concepts5, (2) certain methods of organizing

5 See, e.g., Gottschalk v. Benson, 409 U.S. 63, 71–72 (1972); Bilski v.
Kappos, 561 U.S. 593, 611 (2010); Mackay Radio & Telegraph Co. v. Radio
Corp. of Am., 306 U.S. 86, 94 (1939); SAP Am., Inc. v. InvestPic, LLC, 898
F.3d 1161, 1163 (Fed. Cir. 2018).
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human activity6, and (3) mental processes7. Among those certain methods
of organizing human activity listed in the Revised Guidance are commercial
or legal interactions. Like those concepts, claim 1 recites the concept of a
marketing promotional campaign. Specifically, claim 1 recites operations
that would ordinarily take place in advising one to apply a promotional
discount to a transaction authorization that meets criteria for the promotion.
The advice to apply a promotional discount to a transaction authorization
that meets criteria for the promotion involves detecting a transaction that
satisfies the requirements for redemption of the offer, which is an economic
act, and computing the amount of discount identified by the offer, which is
an act ordinarily performed in the stream of commerce. For example, claim
1 recites “detecting . . . a transaction in the account of the user that satisfies
the requirements for redemption of the offer,” which is an activity that
would take place when one is deciding to apply a marketing promotion.
Similarly, claim 1 recites “computing . . . the amount of discount identified
by the offer,” which is also characteristic of commercial marketing
promotion.
The Examiner determines the claims to be directed to the recited steps.
Final Act. 2–4. The preamble to claim 1 does not recite what it is to achieve,
but the steps in claim 1 result in modifying a commercial transaction by

6 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).
7 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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incorporating the value of some promotion and inserting that modified
transaction into the stream of commerce absent any technological
mechanism other than a conventional computer for doing so.
As to the specific limitations, limitations 1.1 and 2.5 recite receiving
data. Limitations 2.3, 2.4, and 2.6 recite generic and conventional data
transmission. Limitation 2.2 recites generic data update. Limitation 2.1
recites a mathematical calculation. Limitations 1.3 and 2 recite conventional
data processing. Limitations 1 and 1.2 recite generic analysis. All of these
recite receiving, analyzing, processing, updating, and transmitting of
transaction data, which advise one to apply generic functions to get to these
results. The limitations thus recite advice for applying a promotional
discount to a transaction authorization that meets criteria for the promotion.
To advocate applying a promotional discount to a transaction authorization
that meets criteria for the promotion is conceptual advice for results desired
and not technological operations.
The Specification at paragraph 3 describes the invention as relating to the
processing of payment transactions, such as payments made via credit cards,
debit cards, prepaid cards, etc., and the redemption of the benefits of offers,
such as coupons, deals, discounts, rewards, etc. Thus, all this intrinsic
evidence shows that claim 1 is directed to a marketing promotional
campaign. 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 marketing promotions are
organized human behavior to promote further commerce. The concept of a
marketing promotional campaign by applying a promotional discount to a
transaction authorization that meets criteria for the promotion is one idea for
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inducing customers to buy more. The steps recited in claim 1 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. Ultramercial, Inc. v. Hulu, LLC,
772 F.3d 709, 715 (Fed. Cir. 2014)(advertising).
From this we conclude that at least to this degree, claim 1 is directed
to a marketing promotional campaign by applying a promotional discount to
a transaction authorization that meets criteria for the promotion, 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 1 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.8
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.

8 See, e.g., Alice, 573 U.S. at 223, discussing Diamond v. Diehr, 450 U.S.
175 (1981).
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Alice, 573 U.S. at 217 (citations omitted).
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. Steps 1.1 and 2.5 are pure data gathering
steps. Limitations describing the nature of the data do not alter this. Steps
1.3, 2, and 2.2 recite basic conventional data operations such as processing,
updating, and storing data. Steps 2.3, 2.4, and 2.6 are insignificant post
solution activity, such as storing, transmitting, or displaying the results.
Steps 1 and 1.2 recite generic computer analysis. All of these recite generic
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.
Viewed as a whole, Appellants’ claim 1 simply recites the concept of
a marketing promotional campaign by applying a promotional discount to a
transaction authorization that meets criteria for the promotion 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 do not recite any particular implementation.
Claim 1 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 Specification spells out different generic
equipment9 and parameters that might be applied using this concept and the

9 The Specification describes a computer terminal, a television set, a
personal computer, a set-top box, a portable computer, a cellular phone,
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particular steps such conventional processing would entail based on the
concept of marketing promotional campaign by applying a promotional
discount to a transaction authorization that meets criteria for the promotion
under different scenarios. It does not describe any particular improvement
in the manner a computer functions. Instead, claim 1 at issue amounts to
nothing significantly more than an instruction to apply a marketing
promotional campaign by applying a promotional discount to a transaction
authorization that meets criteria for the promotion 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 reflect 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 1 is directed to achieving the result of a
marketing promotional campaign by advising one to apply a promotional
discount to a transaction authorization that meets criteria for the promotion,

a personal digital assistant (PDA), a pager, a security card, a wireless
terminal, or the like. Spec. para. 444.
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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.
STEP 2B
The next issue is whether claim 1 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 “implement[t]” an abstract
idea “on . . . a computer,” that addition cannot impart patent
eligibility. This conclusion accords with the pre-emption
concern that undergirds our § 101 jurisprudence. Given the
ubiquity of computers, wholly generic computer
implementation is not generally the sort of “additional
feature[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).
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“[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, analyzing, processing, updating, and transmitting
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 activities that are performed only for their
conventional uses. See Elec. Power Grp. v. Alstom S.A., 830 F.3d 1350,
1353 (Fed. Cir. 2016). Also see 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.
Appellants do not contend they invented any of these activities. In short,
each step does no more than require a generic computer to perform generic
computer functions. 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. v. InvestPic LLC, 898 F.3d 1161, 1168
(Fed. Cir. 2018).
Considered as an ordered combination, the computer components of
Appellants’ claim 1 add nothing that is not already present when the steps
are considered separately. The sequence of data reception-analysis-
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processing-update-transmission 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, LLC v. Bed Bath & Beyond, Inc., 876 F.3d
1372, 1378 (Fed. Cir. 2017) (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)
(sequence of processing, routing, controlling, and monitoring). The ordering
of the steps is therefore ordinary and conventional.
In terms of how the processing is physically apportioned, again, this is
conventional. The recital of a handler is no more than a label for a
conceptual modular boundary for conceptually analyzing transactions for
marketing promotion. Placement of the handler in the stream of transactions
is dictated by the data it operates upon. It is conventional to place a function
amid the data stream that feeds the function and accepts its results. As an
example, see Figure 3 of the White reference. Beyond that, much distributed
computing architectures10, such as most client-server architectures follow
this formulation, where a separate device performs specialized functions.
Thus, the concept of applying promotions to transactions conventionally
engenders the concept of performing the function in the transaction stream,
and distributing the processing with separate devices is conventional and
generic.

10 For example, see Donaldson, Designing a Distributed Processing System,
ISBN 0470268891, 9780470268896 Wiley, 1979 as support for how old and
conventional this is.
https://books.google.com/books?id=OzazAAAAIAAJ&q
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It is equally conventional to communicate using communication paths
that are outside an electronic payment processing network, if only because
communications are far more ubiquitous than payment processing, and
payment processing presents a standardized information flow that is not
meant to accommodate ad hoc communication.
We conclude that claim 1 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 1 is representative. The remaining method claims merely
describe process parameters. We conclude that the method claims at issue
are directed to a patent-ineligible concept itself, and not to the practical
application of that concept.
As to the structural claims, they
are no different from the method claims in substance. The
method claims recite the abstract idea implemented on a generic
computer; the system claims recite a handful of generic
computer components configured to implement the same idea.
This Court has long “warn[ed] ... against” interpreting § 101“in
ways that make patent eligibility ‘depend simply on the
draftsman’s art.’
Alice, 573 U.S. at 226. As a corollary, the claims are 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
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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 marketing promotional campaign by advising one to
apply a promotional discount to a transaction authorization that meets
criteria for the promotion, without significantly more.
APPELLANTS’ ARGUMENTS
We are not persuaded by Appellants’ argument that the Examiner
“erred in focusing on piecemeal analyses of individual pieces and lost sight
of the claimed invention as a whole and as an ordered combination.” App.
Br. 15. The analysis supra considers the exemplary claim both as individual
limitations and as a whole. The argument does not make any particular
contentions as to how the analysis should be applied to the specific claim
limitations and the claim as a whole.
We are not persuaded by Appellants’ argument that the Examiner
“erred in limiting the two steps of the Mayo Test to two different isolated
parts of a claimed invention.” App. Br. 18. The analysis supra, applies the
tests to all parts of the exemplary claim. The argument does not make any
particular contentions as to how the analysis should be applied to the
specific claim as a whole.
We are not persuaded by Appellants’ argument that “the Office
Action failed to consider an ordered combination of elements that have been
considered in the first stage, Directed-To Inquiry (Step 2A) and additional
elements that have not been considered in the first stage, Directed-To
Inquiry (Step 2A).” App. Br. 19. An analysis of the ordered combination is
provided supra. The argument does not make any particular contentions as
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to how the analysis should be applied to the specific claim as an ordered
combination.
We are not persuaded by Appellants’ argument that “[t]he Bascom11
decision shows that in the analysis of the ordered combination, an
explanation of a reason to combine is required, in addition to recognizing
that each claim element, by itself, was known in the art.” App. Br. 20.
Initially, we remind Appellants that BASCOM did not find claims eligible on
the substance, but rather that the Appellees did not provide sufficient
evidence to support a 12(b)(6) motion to dismiss in which facts are
presumed in the non-movant’s favor.
The key fact in BASCOM was the presence of a structural change in
“installation of a filtering tool at a specific location, remote from the end-
users, with customizable filtering features specific to each end user. This
design gives the filtering tool both the benefits of a filter on a local computer
and the benefits of a filter on the ISP server.” BASCOM, 827 F.3d at 1350.
This structural change occurred in the context of the internet as it existed at
filing in March 1997 when dial up internet service was still prevalent. It was
not the idea of having user customizable filtering located separately from the
user that was inventive, but the manner of accomplishing it in that context,
as the relatively primitive internet architecture at that time did not readily
lend itself to such filtering. Filtering located separately from the user was
already performed. “To overcome some of the disadvantages of installing
filtering software on each local computer, another prior art system relocated
the filter to a local server.” Id. at 1344. But it was known that allowing user

11 BASCOM Glob. Internet Servs., Inc. v. AT&T Mobility LLC, 827 F.3d
1341 (Fed. Cir. 2016)
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customization there was desirable. “However, the one-size-fits-all filter on
the local server was not ideal.” Id.
The BASCOM filter was invented prior to the now prevalent use of
self identifying devices with media access control (MAC) addresses. Thus,
absent that, “BASCOM explains that the inventive concept rests on taking
advantage of the ability of at least some ISPs to identify individual accounts that
communicate with the ISP server, and to associate a request for Internet content
with a specific individual account.” Id. Thus, BASCOM solved the problem of
how to create the structural relationship known to be desired by finding a way to
relate a user to a centrally located filter at a time when how to do so was unclear.
It was not the structural relation per se, but how it was accomplished that was
inventive. No analogous technological hurdle is described in the instant record.
Indeed the whole point appears to be to simply use existing transaction streams
and devices to introduce market promotions by adding a record containing
parameters and a server to introduce the promotional data.
As we determine supra, the concept for the ordered combination of
placing a transaction handler in the stream of transactions is engendered by
the functional concept itself, of applying promotions to transactions. This is
a historic, not to say conventional common sense concept. As Admiral
Nelson advised, “[n]o captain can do very wrong if he places his ship
alongside that of the enemy.”12 The conventional place for a naval ship
whose function was defense was in the stream of the enemy to be defended
against. Similarly, the conventional place for a software function is in the
stream of its data feed. In this case, it is also analogous to manual
performance, as without the recited transaction handler, a merchant would

12 Horatio Nelson, The Battle of Trafalgar, October 1805.
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manually modify the amount to have authorized according to the promotion
after ascertaining the before promotion amount, essentially manually
replacing the original amount with the adjusted amount. Again, the concept
of using distributed processing for doing so is just that, a concept.
We are not persuaded by Appellants’ argument that:
An inventive concept of the claimed invention, for example, is
in the installation of a merchant discount tool at a specific
location (a transaction handler on an electronic payment
processing network), remote from merchants and their
customers, with processing techniques that optimize the
performance of the electronic payment processing network
while adding the new functionality of merchant discount
redemption to the electronic payment processing network,
including the use of a trigger record technique to improve the
efficiency in detecting an eligible transaction. A merchant
discount is applied by simply changing the transaction amount
during the routing of the authorization request for a qualified
transaction from an acquirer processor to an issuer processor;
and the details of the application of the merchant discount is
communicated to a transaction terminal via information inserted
in an authorization request communicated in the electronic
payment processing network to the transaction terminal, which
inserted information causes the transaction terminal to query a
portal using a communication channel outside of the electronic
payment processing network to obtain the details.
App. Br. 21. As we determine supra, the location of the transaction handler
is conventional with respect to its data feed. Simply being remote does not
add an inventive element as network components are conventionally placed
relative to their function. Servers and other specialized distributed
computing devices are conventionally separate from presentation devices
such as clients. The argument does not explain in what manner performance
is optimized. The Specification states that “use of the trigger record (613) to
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trigger the transaction handler (103) to check the applicability of the offer
(186) improves the efficiency of the transaction handler (103) by optimized
requirement checking operations relative to the trigger records and by
filtering out transactions that do not meet the requirements of the trigger
records.” Spec. para. 267. This begs the question by saying efficiency is
improved by optimized checking without explaining how optimization
occurs. As we determine supra, the trigger record is no more than a data
repository for criteria. It appears the argument is that using decision criteria
retrieved from a record is a form of optimization. But this is conventional
data filtering in data processing. “[F]iltering content is an abstract idea
because it is a longstanding, well-known method of organizing human
behavior, similar to concepts previously found to be abstract.” BASCOM,
827 F.3d at 1348. Storing data processing search criteria as data on a record
is entirely conventional, as evidenced by the use of data in databases for
search criteria. Presenting related parameters on a single record is
notoriously conventional as anyone who has brought up parameters under
Windows Control Panel understands.
We are not persuaded by Appellants’ argument that “[t]here is
insufficient similarity between the set of abstract ideas and the claimed
invention; and the set of abstract ideas identified in the Office Action does
not reflect the focus of the claimed invention as a whole.” App. Br. 22.
This is a conclusory argument with no specific contentions. As we
determine supra, the claims as a whole are directed to applying a
promotional discount to a transaction authorization that meets criteria for the
promotion. The claims recite doing so using conventional computer
operations. We determine that the use of the recited trigger record and
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transaction handler is also conventional parameter storage and distributed
processing.
We are not persuaded by Appellants’ argument that
one technological solution includes the use of trigger records to
allow a transaction handler to operate on a subset of conditions,
optimized for the operation of transaction handler, to detect
transactions that may potentially satisfy the requirements of
offers and filter out transactions that cannot satisfy the
requirements of offers and perform actions specified in the
trigger records for further processing of the detected
transactions.
For example, one technological solution includes the on-the-fly
change of transaction amount in authorization request when the
transaction handler of the electronic payment processing
network routes the authorization request from an acquirer
processor and an issuer processor in the electronic payment
processing network.
For example, one technological solution includes the
combination of an information provided in an authorization
response routed to a transaction terminal in the electronic
payment processing network and a portal that accepts the query
from the transaction terminal caused by the information in the
authorization response to communicate information about the
merchant discount offer applied to the transaction via the on-
the-fly changing of the transaction amount.
The technological solutions minimize the impact of the
implementation of the merchant discount redemption tool on
the performance of the electronic payment processing network
in processing the authorization of payment transactions.
App. Br. 22–23. We discuss the use of the trigger record being no more than
conventional supra. On the fly change in amount is a simple data file
update. This is a computer assignment statement of the form field = value.
This is among the most primitive and earliest operations programmers learn.
To say that such an operation benefits from not having to create a different
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variable is to overlook the very fact that this is because the operation is just
that primitive. The benefits from being so primitive are not inventive, they
are inherent. To claim invention to recognized attributes of existing
operations misstates the meaning of invention.
Combining two separate functions performed by two separate
modules of a transaction handler and a portal is simply conventional
performance of plural functions by their respective modules.
To offload work from a device such as that at a merchant to a central
processing module such as a transaction handler is conventional distributed
computed, e.g. client-server, processing. The record shows no technological
difficulty in doing so.
We are not persuaded by Appellants’ argument that:
The claimed invention of the present application provides an
improvement in computer-related technology by allowing a
computing device in an electronic payment processing network
(e.g., as an enhanced transaction handler (116)) to perform a
function that is not previously performable by a conventional
transaction handler or a generic computer. More specifically,
the “rules” of operations of the improved computing device
allows the computer performance of not only the processing the
authorization of a payment transactions between accounts
controlled by different computers on an electronic payment
processing network but also the redemption of a merchant
discount offer, in a specific way that minimizes the impact of
the merchant discount offer redemption tool on the processing
of authorization requests in the electronic payment processing
network.
App. Br. 24. The argument does not contend it was not technologically
performable. The nature of the claims shows it was not performable only
because the concept was not formulated and reduced to software. This is
true for all novel abstract ideas mirrored on a computer. The rules of
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operation are conventional filtering and data update of existing transaction
data. Processing of payments on different computers is the ordinary course
of commerce as evidenced by the various hardware at various merchants.
To offload work from a device such as that at a merchant to a central
processing module such as a transaction handler is conventional distributed
computed, e.g. client-server, processing. Such techniques are too
conventional to be considered inventive.
Appellants also attempt to analogize the claims to those involved in
McRO, Inc. v. Bandai Namco Games Am. Inc., 837 F.3d 1299 (Fed. Cir.
2016). App. Br. 24–25. In McRO, the court held that, although the
processes were previously performed by humans, “the traditional process
and newly claimed method . . . produced . . . results in fundamentally
different ways.” FairWarning v. Iatric Systems, 839 F.3d 1089, 1094
(Fed. Cir. 2016) (differentiating the claims at issue from those in McRO).
In McRO, “it was the incorporation of the claimed rules, not the use of the
computer, that improved the existing technology process,” because the
prior process performed by humans “was driven by subjective
determinations rather than specific, limited mathematical rules.” 837 F.3d
at 1314 (internal quotation marks, citation, and alterations omitted). In
contrast, the claims of the instant application merely implement an old
practice of using decision criteria in making sales decisions in a new
environment. Appellants have not argued that the claimed processes of
selecting promotions apply rules of selection in a manner
technologically different from those which humans used, albeit with less
efficiency, before the invention was claimed. Merely pigeonholing the
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objects of decision making to aid decision making is both old and itself
abstract.
The claims in McRO were not directed to an abstract idea, but
instead were directed to “a specific asserted improvement in
computer animation, i.e., the automatic use of rules of a
particular type.” We explained that “the claimed improvement
[was] allowing computers to produce ‘accurate and realistic lip
synchronization and facial expressions in animated characters’
that previously could only be produced by human animators.”
The claimed rules in McRO transformed a traditionally
subjective process performed by human artists into a
mathematically automated process executed on computers.
FairWarning, 839 F.3d at 1094.
The Reply Brief does not add any further substantive arguments.
Claims 1, 6, 8–18, and 20 rejected under 35 U.S.C. § 103(a) as unpatentable
over White, Hammad, Salmon, Main, and Winters
We are persuaded by Appellants’ argument that the art fails to
describe the recited trigger record. App. Br. 10. The Examiner determines
that White describes the data recited (Final Act. 12), but White only
describes storing the data in a data source, not a record.
CONCLUSIONS OF LAW
The rejection of claims 1, 6, 8–18, and 20 under 35 U.S.C. § 101 as
directed to a judicial exception without significantly more is proper.
The rejection of claims 1, 6, 8–18, and 20 under 35 U.S.C. § 103(a) as
unpatentable over White, Hammad, Salmon, Main, and Winters is improper.
DECISION
The rejection of claims 1, 6, 8–18, and 20 is affirmed.
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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