Sheila H. James et al.Download PDFPatent Trials and Appeals BoardOct 31, 201912408449 - (D) (P.T.A.B. Oct. 31, 2019) Copy Citation UNITED STATES PATENT AND TRADEMARK OFFICE UNITED STATES DEPARTMENT OF COMMERCE United States Patent and Trademark Office Address: COMMISSIONER FOR PATENTS P.O. Box 1450 Alexandria, Virginia 22313-1450 www.uspto.gov APPLICATION NO. FILING DATE FIRST NAMED INVENTOR ATTORNEY DOCKET NO. CONFIRMATION NO. 12/408,449 03/20/2009 Sheila H. JAMES 90945-822622 (019500US) 9388 20350 7590 10/31/2019 KILPATRICK TOWNSEND & STOCKTON LLP Mailstop: IP Docketing - 22 1100 Peachtree Street Suite 2800 Atlanta, GA 30309 EXAMINER RANKINS, WILLIAM E ART UNIT PAPER NUMBER 3694 NOTIFICATION DATE DELIVERY MODE 10/31/2019 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): KTSDocketing2@kilpatrick.foundationip.com ipefiling@kilpatricktownsend.com PTOL-90A (Rev. 04/07) UNITED STATES PATENT AND TRADEMARK OFFICE ____________ BEFORE THE PATENT TRIAL AND APPEAL BOARD ____________ Ex parte SHEILA H. JAMES, JOHN A. MacMILLIAN, RADHIKA AGARWAL, MARWAN FORZLEY, and SAMER FORZLEY ____________ Appeal 2018-007022 Application 12/408,449 Technology Center 3600 ____________ Before ST. JOHN COURTENAY III, JENNIFER L. McKEOWN, and JASON M. REPKO, Administrative Patent Judges. COURTENAY, Administrative Patent Judge. DECISION ON APPEAL Appellant1 appeals under 35 U.S.C. § 134(a) from a final rejection of claims 27–38, which are all the claims pending in this application. Claims 1–26 are canceled. We have jurisdiction over the pending claims under 35 U.S.C. § 6(b). We affirm. 1 We use the word “Appellant” to refer to “Applicants” as defined in 37 C.F.R. § 1.42(a). Appellant identifies the real party in interest as the “Western Union Company.” App. Br. 2. Appeal 2018-007022 Application 12/408,449 2 STATEMENT OF THE CASE 2 Introduction Embodiments of Appellant’s claimed invention relates “generally to payment processing. More particularly, the present invention relates processing of a cash payment, such as an online bill payment, for an electronic purchase transaction.” Spec. ¶ 2. New Grounds of Rejection are set forth in the Answer A. Claims 27–38 are rejected under pre-AIA 35 U.S.C. § 112, first paragraph, as failing to comply with the written description requirement. Ans. 5. B. Claims 27–38 are again rejected under 35 U.S.C. § 101, as being directed to a judicial exception, without significantly more. Ans. 2–5. ANALYSIS We reproduce infra independent claim 27 in Table One. We have considered all of Appellant’s arguments and any evidence presented. To the extent Appellant has not advanced separate, substantive arguments for particular claims, or other issues, such arguments are waived. See 37 C.F.R. § 41.37(c)(1)(iv). 2 We herein refer to the Final Office Action, mailed April 29, 2015 (“Final Act.”); Appeal Brief, filed Sept. 29, 2015 (“App. Br.”); Examiner’s Answer, mailed Feb. 11, 2016 (“Ans.”), and the Reply Brief, filed Feb. 2, 2018 (“Reply Br.”). Appeal 2018-007022 Application 12/408,449 3 Rejection A of Claims 27–38 under 35 U.S.C. § 112, first paragraph Issue: Under 35 U.S.C. § 112, first paragraph, did the Examiner err by rejecting claims 27–38, as failing to comply with the written description and/or enablement requirement? See new ground of rejection in Answer 5. Regarding the written description requirement, the Examiner finds: “The claims recite the determination of a cash payment risk score but do not disclose how the score is calculated. The disclosure merely recites what the risk score is based on (Para 0062). The actual algorithm or formula used to calculate the risk score is not disclosed.” Ans. 5. Appellant disagrees: As known in the art, any of the variables on which the cash payment risk score may be based may present themselves in very different manners (see below), therefore it is impossible to specify a particular, or even general algorithm that might be used to determine the cash payment risk score that would be applicable to all or even most circumstances This is also why the claims further leave "stored low risk threshold" undescribed, as the threshold would vary wildly, and be based on how the risk score was determined, and on which characteristics. For example, paragraph 62 of the specification discusses how matching of billing and shipping addresses matching (a Boolean ‘0’ or ‘1’ condition) or payment velocity (an amount over time condition) could be the basis for a cash payment risk score. Consequently, the threshold score, like the risk score, could be determined in a wide variety of ways. Those of skill in the art would understand that how the cash payment risk score is determined would also affect how the low risk threshold would be determined. While broad, the specification leaves no doubt that the inventors had possession of the full breadth of these recitations. Appeal 2018-007022 Application 12/408,449 4 Reply Br. 5. Claim 27 recites, in pertinent part: “determining, by the risk processing system, a cash payment risk score based at least in part on the order information, the non-confidential purchased information, and the merchant information.” (emphasis added). In reviewing the Specification, we find sufficient written description support in at least paragraph 58: According to an embodiment of the present invention, risk scoring or risk assessment can be based on risk assessment of the merchant, purchaser and/or the electronic purchase transaction, or order. Manual order reviews may be conducted by the cash payment administrator. The risk score, or risk assessment, can be based on one or more of the following criteria: IP country (out/risk); email (private, public); IP/shipping/billing distance; open proxy (common, hiding, known bad); billing and shipping match; address verification on name, billing/shipping, telephone; cash payment amount within risk limit (average cash payment value + credit limit); shipping method (ground, express); velocity (within/across merchants); prior shipped unpaid/paid orders; account holder name on payment; and merchant customer ranking (existing good, existing bad, new). Spec. ¶ 58. Therefore, given this evidence, we find at least paragraph 58 of Appellant’s Specification provides sufficient written description support to show possession of the claimed subject matter. Accordingly, for essentially the same reasons argued by Appellants (Reply Br. 5), we are constrained on this record to reverse the Examiner’s Rejection A under pre-AIA 35 U.S.C. § 112, first paragraph, of all claims 27–38 on appeal. Appeal 2018-007022 Application 12/408,449 5 Rejection of Claims 27–38 under 35 U.S.C. § 101 Issue: Under 35 U.S.C. § 101, did the Examiner err by rejecting claims 27–38, as being directed to a judicial exception, without significantly more? 3 Principles of Law — 35 U.S.C. § 101 An invention is patent-eligible if it claims a “new and useful process, machine, manufacture, or composition of matter.” 35 U.S.C. § 101. However, the Supreme Court has long interpreted 35 U.S.C. § 101 to include implicit exceptions: “‘[L]aws of nature, natural phenomena, and abstract ideas’ are not patentable.” Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66, 70 (2012) (quoting Diamond v. Diehr, 450 U.S. 175, 185 (1981)). In determining whether a claim falls within an excluded category, we are guided by the Supreme Court’s two-step framework, described in Mayo and Alice. Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 573 U.S. 208, 217–18 (2014) (citing Mayo, 566 U.S. at 75–77). In accordance with that framework, we first determine what concept the claim is “directed to.” See Alice, 573 U.S. at 219 (“On their face, the claims before us are drawn to the concept of intermediated settlement, i.e., the use of a third party to mitigate settlement risk.” (emphasis omitted)); see also Bilski v. Kappos, 561 U.S. 593, 611 (2010) (“Claims 1 and 4 in petitioners’ application explain the basic concept of hedging, or protecting against risk.”). 3 Although the Examiner sets forth a single-paragraph rejection under 35 U.S.C. § 101 in the Final Action (6), the Examiner sets forth a new ground of rejection under 35 U.S.C. § 101 in the Answer, and provides more analysis in support. See Ans. 2–5. Appeal 2018-007022 Application 12/408,449 6 Concepts determined to be abstract ideas, and thus patent ineligible, include certain methods of organizing human activity, such as fundamental economic practices (Alice, 573 U.S. at 219–20; Bilski, 561 U.S. at 611); mathematical formulas (Parker v. Flook, 437 U.S. 584, 594–95 (1978)); and mental processes (Gottschalk v. Benson, 409 U.S. 63, 69 (1972)). Concepts determined to be patent eligible include physical and chemical processes, such as “molding of rubber products” (Diehr, 450 U.S. at 193); “tanning, dyeing, making water-proof cloth, vulcanizing India rubber, smelting ores” (id. at 182 n.7 (quoting Corning v. Burden, 56 U.S. (15 How.) 252, 267–68 (1854))); and manufacturing flour (Benson, 409 U.S. at 69 (citing Cochrane v. Deener, 94 U.S. 780, 785 (1876))). In Diehr, the claim at issue recited a mathematical formula, but the Supreme Court held that “[a] claim drawn to subject matter otherwise statutory does not become nonstatutory simply because it uses a mathematical formula.” Diehr, 450 U.S. at 187; see also id. at 191 (“We view respondents’ claims as nothing more than a process for molding rubber products and not as an attempt to patent a mathematical formula.”). Having said that, the Supreme Court also indicated that a claim “seeking patent protection for that formula in the abstract . . . is not accorded the protection of our patent laws, . . . and this principle cannot be circumvented by attempting to limit the use of the formula to a particular technological environment.” Id. (citing Benson and Flook); see, e.g., id. at 187 (“It is now commonplace that an application of a law of nature or mathematical formula to a known structure or process may well be deserving of patent protection.”). Appeal 2018-007022 Application 12/408,449 7 If the claim is “directed to” an abstract idea, we turn to the second step of the Alice and Mayo framework, where “we must examine the elements of the claim to determine whether it contains an ‘inventive concept’ sufficient to ‘transform’ the claimed abstract idea into a patent- eligible application.” Alice, 573 U.S. at 221 (citation omitted). “A claim that recites an abstract idea must include ‘additional features’ to ensure ‘that the [claim] is more than a drafting effort designed to monopolize the [abstract idea].’” Id. (alterations in original) (quoting Mayo, 566 U.S. at 77). “[M]erely requir[ing] generic computer implementation[] fail[s] to transform that abstract idea into a patent-eligible invention.” Id. Subject Matter Eligibility — 2019 Revised Guidance The USPTO recently published revised guidance on the application of 35 U.S.C. § 101. See 2019 Revised Patent Subject Matter Eligibility Guidance, 84 Fed. Reg. 50 (Jan. 7, 2019) (“2019 Revised Guidance”). This new guidance is applied in this Opinion. Under the 2019 Revised Guidance, we first look to whether the claim recites: (1) any judicial exceptions, including certain groupings of abstract ideas (i.e., mathematical concepts, mental processes, or certain methods of organizing human activity such as a fundamental economic practice or managing personal behavior or relationships or interactions between people);4 and 4 Referred to as “Step 2A, Prong One” in the Revised Guidance (hereinafter “Step 2A, prong 1”). Appeal 2018-007022 Application 12/408,449 8 (2) additional elements that integrate the judicial exception into a practical application (see Manual of Patent Examining Procedure (“MPEP”) §§ 2106.05(a)–(c), (e)–(h)).5, 6 See 2019 Revised Guidance, 84 Fed. Reg. at 51–52, 55. A claim that integrates a judicial exception into a practical application applies, relies on, or uses 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. See 2019 Revised Guidance, 84 Fed. Reg. at 54. When the judicial exception is so integrated, then the claim is not directed to a judicial exception and is patent eligible under 35 U.S.C. § 101. Id. Only if a claim: (1) recites a judicial exception and (2) does not integrate that exception into a practical application, do we then evaluate whether the claim provides an inventive concept. See 2019 Revised Guidance, 84 Fed. Reg. at 56; Alice, 573 U.S. at 217–18. For example, we look to whether the claim: (3) adds a specific limitation beyond the judicial exception that is not “well-understood, routine, conventional” in the field (see MPEP § 2106.05(d)); or (4) simply appends well-understood, routine, and conventional activities previously known to the industry, specified at a high level of generality, to the judicial exception. 7 5 Referred to as “Step 2A, Prong Two” in the Revised Guidance (hereinafter “Step 2A, prong 2”). 6 All references to the MPEP are to the Ninth Edition, Revision 08.2017 (rev. Jan. 2018). 7 Items (3) and (4) continue to be collectively referred to as “Step 2B” of the Supreme Court’s two-step framework, described in Mayo and Alice. Appeal 2018-007022 Application 12/408,449 9 See 2019 Revised Guidance, 84 Fed. Reg. at 56. Because there is no single definition of an “abstract idea” under Alice step 1, the PTO has recently synthesized, for purposes of clarity, predictability, and consistency, key concepts identified by the courts as abstract ideas to explain that the “abstract idea” exception includes the following three groupings: 1. Mathematical concepts—mathematical relationships, mathematical formulas or equations, mathematical calculations; 2. Mental processes— concepts performed in the human mind (including an observation, evaluation, judgment, opinion); and 3. Certain methods of organizing human activity—fundamental economic principles or practices (including hedging, insurance, mitigating risk); commercial or legal interactions (including agreements in the form of contracts; legal obligations; advertising, marketing or sales activities or behaviors; business relations); managing personal behavior or relationships or interactions between people (including social activities, teaching, and following rules or instructions). See 2019 Revised Guidance, 84 Fed. Reg. at 52. According to the 2019 Revised Guidance, “[c]laims that do not recite [subject] matter that falls within these enumerated groupings of abstract ideas should not be treated as reciting abstract ideas,” except in rare circumstances. Even if the claims recite any one of these three groupings of abstract ideas, these claims are still not “directed to” a judicial exception (abstract idea), and thus are patent eligible, if “the claim as a whole integrates the recited judicial exception into a practical application of that exception.” See 2019 Revised Guidance, 84 Fed. Reg. at 53. Appeal 2018-007022 Application 12/408,449 10 For example, limitations that are indicative of integration into a practical application include: 1. Improvements to the functioning of a computer, or to any other technology or technical field — see MPEP § 2106.05(a); 2. Applying the judicial exception with, or by use of, a particular machine — see MPEP § 2106.05(b); 3. Effecting a transformation or reduction of a particular article to a different state or thing — see MPEP § 2106.05(c); and 4. Applying or using 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 — see MPEP § 2106.05(e). In contrast, limitations that are not indicative of integration into a practical application include: 1. Adding the words “apply it” (or an equivalent) with the judicial exception, or merely include instructions to implement an abstract idea on a computer, or merely uses a computer as a tool to perform an abstract idea — see MPEP § 2106.05(f); 2. Adding insignificant extra-solution activity to the judicial exception — see MPEP § 2106.05(g); and 3. Generally linking the use of the judicial exception to a particular technological environment or field of use — see MPEP 2106.05(h). See 2019 Revised Guidance, 84 Fed. Reg. at 54–55 (“Prong Two”). Appeal 2018-007022 Application 12/408,449 11 2019 Revised Guidance, Step 2A, Prong One8 The Judicial Exception Under the 2019 Revised Guidance, we begin our analysis by first considering whether the claims recite any judicial exceptions, including certain groupings of abstract ideas, in particular: (a) mathematical concepts, (b) mental steps, and (c) certain methods of organizing human activities. We note the Examiner amends and updates the 101 rejection in the Answer (2–5), such that it is restated as a new ground of rejection. The Examiner concludes that all claims 27–38 recite an “abstract idea of comparing new and stored information and using rules to identify options.” Ans. 2. In Table One below, we identify in italics the specific claim limitations that we conclude recite an abstract idea. We also identify in bold the additional (non-abstract) claim limitations that are generic computer components: TABLE ONE Independent Claim 27 Revised 2019 Guidance [a] A method for receiving payment for an online transaction between a purchaser and a merchant, wherein the method comprises: A process (method) is a statutory subject matter class. See 35 U.S.C. § 101 (“Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject 8 Throughout this opinion, we give the claim limitations the broadest reasonable interpretation consistent with the Specification. See In re Morris, 127 F.3d 1048, 1054 (Fed. Cir. 1997). Appeal 2018-007022 Application 12/408,449 12 Independent Claim 27 Revised 2019 Guidance to the conditions and requirements of this title.”). receiving payment for an online transaction between a purchaser and a merchant is an insignificant extra- solution activity. 2019 Revised Guidance, 55 n.31; see also MPEP § 2106.05(g). [b] receiving, at a merchant system, an online order of good or services from the purchaser; receiving an online order of goods or services from the purchaser is an insignificant extra-solution activity, i.e., data gathering. 2019 Revised Guidance, 55 n.31; see also MPEP § 2106.05(g). The merchant system is an additional non-abstract limitation. [c] receiving, at the merchant system, a selection of a cash payment option; receiving a selection of a cash payment option is an insignificant extra-solution activity. 2019 Revised Guidance, 55 n.31; see also MPEP § 2106.05(g). [d] receiving, at the merchant system, order information and non- confidential purchaser information, wherein: receiving order information and non- confidential purchaser information is an insignificant extra-solution activity, i.e., data gathering. 2019 Revised Guidance, 55 n.31; see also MPEP § 2106.05(g). Appeal 2018-007022 Application 12/408,449 13 Independent Claim 27 Revised 2019 Guidance [e] the order information includes data regarding the online order of goods or services; and including data regarding the online order of goods or services is an insignificant extra-solution activity. 2019 Revised Guidance, 55 n.31; see also MPEP § 2106.05(g). [f] the non-confidential purchaser information includes data regarding the purchaser, but does not include credit card information, bank account routing information, a data [sic] of birth, and a social security number; including data regarding the purchaser, but not including credit card information, bank account routing information, a date of birth, and a social security number is an insignificant extra-solution activity. 2019 Revised Guidance, 55 n.31; see also MPEP § 2106.05(g). [g] sending, from the merchant system to a risk processing system, at least: the order information; the non-confidential purchaser information; and merchant information; sending, from the merchant system to a risk processing system, at least: the order information, the non- confidential purchaser information, and merchant information is an insignificant extra-solution activity. 2019 Revised Guidance, 55 n.31; see also MPEP § 2106.05(g). The merchant system and the risk processing system are additional non-abstract limitations. [h] determining, by the risk processing system, a cash payment risk score based at least in part on the order information, the non- confidential purchased information, and the merchant information; Abstract idea: determining a cash payment risk score could be performed alternatively as a mental process. See 2019 Revised Guidance 52. Appeal 2018-007022 Application 12/408,449 14 Independent Claim 27 Revised 2019 Guidance [i] determining, with an administration system, whether the cash payment risk score is more positive than a stored low risk threshold; Abstract idea: determining whether the cash payment risk score is more positive than a stored low risk threshold could be performed alternatively as a mental process. See 2019 Revised Guidance 52. The administrative system is an additional non-abstract limitation. [j] if the cash payment risk score is higher than the stored low risk threshold: Abstract idea: determining whether the cash payment risk score is higher than the stored low risk threshold could be performed alternatively as a mental process. See 2019 Revised Guidance 52. [k] sending a shipping authorization to the merchant system; and sending a shipping authorization to the merchant system is insignificant extra-solution activity. 2019 Revised Guidance, 55 n.31; see also MPEP § 2106.05(g). [l] causing a payment to be made to the merchant prior to receiving a cash payment from the purchaser; and Abstract idea: causing a payment to be made to the merchant prior to receiving a cash payment from the purchaser recites a method of organizing human activity, including a fundamental economic practice, further including sales activities or behaviors; business relations. See 2019 Revised Guidance, 84 Fed. Reg. at 52. Appeal 2018-007022 Application 12/408,449 15 Independent Claim 27 Revised 2019 Guidance [m] if the cash payment risk score is lower than the stored low risk threshold: Abstract idea: determining if the cash payment risk score is lower than the stored low risk threshold could be performed alternatively as a mental process. See 2019 Revised Guidance 52. [n] receiving, at the administration system from a bill payment system of a financial institution, after determination of the cash payment risk score, an indication that a cash payment has been completed; Abstract idea: receiving an indication that a cash payment has been completed recites a method of organizing human activity, including a fundamental economic practice, further including sales activities or behaviors; business relations. See 2019 Revised Guidance, 84 Fed. Reg. at 52. The administrative system and the bill payment system are additional non-abstract limitations. [o] determining, with the administration system, whether the cash payment is fraudulent, based at least in part on the cash payment risk score; Abstract idea: determining whether the cash payment is fraudulent, based at least in part on the cash payment risk score recites a method of organizing human activity, including a fundamental economic practice, further including sales activities or behaviors; business relations. See 2019 Revised Guidance, 84 Fed. Reg. at 52. Abstract idea: determining whether the cash payment is fraudulent, based at least in part on the cash Appeal 2018-007022 Application 12/408,449 16 Independent Claim 27 Revised 2019 Guidance payment risk score could also be performed as a mental process. See 2019 Revised Guidance 52. [p] if the cash payment is determined to not be fraudulent, causing, with the administration system, the cash payment to be released to the merchant; and Abstract idea: causing, with the administration system, the cash payment to be released to the merchant if the cash payment is determined to not be fraudulent recites a method of organizing human activity, including a fundamental economic practice, further including sales activities or behaviors; business relations. See 2019 Revised Guidance, 84 Fed. Reg. at 52. [q] if the cash payment is determined to be fraudulent, causing, with the administration system, the cash payment to be refunded to the financial institution. Abstract idea: causing, with the administration system, the cash payment to be refunded to the financial institution if the cash payment is determined to be fraudulent recites a method of organizing human activity, including a fundamental economic practice, further including sales activities or behaviors; business relations. See 2019 Revised Guidance, 84 Fed. Reg. at 52. Appeal 2018-007022 Application 12/408,449 17 Abstract Ideas —Methods of Organizing Human Activities We conclude the recited italicized functions shown in Table One recite a method of organizing human activity, including a fundamental economic practice, that further includes sales activities or behaviors, including business relations (e.g., payment risk determination and fraud detection as recited in claim 27). See 2019 Revised Guidance, 84 Fed. Reg. at 52. As also identified in Table One, we conclude some of the italicized steps could be performed alternatively as mental processes under the Revised Guidance. See 2019 Revised Guidance, 84 Fed. Reg. at 52. 9 Cf. CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d 1366, 1372 (Fed. Cir. 2011) (“Rather, the broad scope of claim 3 extends to essentially any method of detecting credit card fraud based on information relating past transactions to a particular ‘Internet address,’ even methods that can be performed in the human mind.” See also “Intellectual Ventures I LLC v. Symantec Corp., 838 9 If a method can be performed by human thought alone, or by a human using pen and paper, it is merely an abstract idea and is not patent eligible under § 101. See CyberSource, 654 F.3d at 1372–73; “That purely mental processes can be unpatentable, even when performed by a computer, was precisely the holding of the Supreme Court in Gottschalk v. Benson.” CyberSource, 654 F.3d at 1375. See also Synopsys, Inc. v. Mentor Graphics Corp., 839 F.3d 1138, 1146–47 (Fed. Cir. 2016). Moreover, “[u]sing a computer to accelerate an ineligible mental process does not make that process patent-eligible.” Bancorp Services, L.L.C. v. Sun Life Assur. Co. of Canada (U.S.), 687 F.3d 1266, 1279 (Fed. Cir. 2012); see also OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1363 (Fed. Cir. 2015) (“relying on a computer to perform routine tasks more quickly or more accurately is insufficient to render a claim patent eligible.”). Appeal 2018-007022 Application 12/408,449 18 F.3d 1307, 1318 (Fed. Cir. 2016) (‘[W]ith the exception of generic computer-implemented steps, there is nothing in the claims themselves that foreclose them from being performed by a human, mentally or with pen and paper.’).” 84 Fed. Reg. at 52 n.14. “An abstract idea can generally be described at different levels of abstraction.” Apple, Inc. v. Ameranth, Inc., 842 F.3d 1229, 1240 (Fed. Cir. 2016). Merely combining several abstract ideas does not render the combination any less abstract. See RecogniCorp, LLC v. Nintendo Co., 855 F.3d 1322, 1327 (Fed. Cir. 2017) (“Adding one abstract idea (math) to another abstract idea . . . does not render the claim non-abstract.”); FairWarning IP, LLC v. Iatric Sys., Inc., 839 F.3d 1089, 1093–94 (Fed. Cir. 2016) (determining the pending claims were directed to a combination of abstract ideas). Therefore, we conclude claim 27 recites several abstract ideas, as specifically identified above in Table One. Additional Limitations As emphasized in bold supra, we note the additional non-abstract limitations of: The merchant system, the risk processing system, the administrative system and the bill payment system. See Claim 27. See 2019 Revised Guidance, 84 Fed. Reg. at 52. We also note the supporting exemplary descriptions of generic computer and network components in the Specification, for example: FIG. 1 is a flowchart illustrating a method 100 of risk detection and assessment of a cash payment for an electronic purchase transaction according to an embodiment of the present invention. In an embodiment, the method is performed by a Appeal 2018-007022 Application 12/408,449 19 cash payment administration system, such as a cash payment administrator or a cash payment processor. A computer readable memory can be provided storing statements and instructions for execution by a computer to perform the steps of methods described herein. Spec. ¶ 38 (emphasis added). See also Spec. ¶ 29: “the present invention provides a computer readable memory storing statements and instructions for execution by a computer to perform any of the methods described herein.” (emphasis added). We emphasize that McRO, Inc. v. Bandai Namco Games America Inc., (837 F.3d 1299 (Fed. Cir. 2016)), guides: “[t]he abstract idea exception prevents patenting a result where ‘it matters not by what process or machinery the result is accomplished.’” 837 F.3d at 1312 (quoting O’Reilly v. Morse, 56 U.S. 62, 113 (1854)) (emphasis added). We note independent method claims 36, 37, and 38 recite similar limitations of commensurate scope as compared to independent method claim 27. See supra Table One. Because we conclude all claims 27–38 on appeal recite an abstract idea, as identified above, under Step 2A, Prong One, we proceed to Step 2A, Prong Two. 2019 Revised Guidance, Step 2A, Prong Two Integration of the Judicial Exception into a Practical Application Pursuant to the 2019 Revised Guidance, we consider whether there are additional elements set forth in the claims that integrate the judicial exception into a practical application. See 2019 Revised Guidance, 84 Fed. Reg. at 54–55. Appeal 2018-007022 Application 12/408,449 20 MPEP § 2106.05(a) Improvements to the Functioning of a Computer or to Any Other Technology or Technical Field Appellant argues the claims of the present invention provide an improvement to the functioning of an existing field of technology: 10 Specifically, sales technology is improved since the systems/methods described are used to facilitate such transactions. Also, privacy technology is improved because certain information is masked from the payment processing system. Finally, escrowing technology is improved because the systems/methods obviate the need for escrow relationships where risk is determined to be minimal. Many other technological areas are also improved by the claims, as will be apparent to those of skill in the art upon reading the lengthy claims. Reply Br. 3 (emphasis added). However, as set forth in MPEP § 2106.05(a): To show that the involvement of a computer assists in improving the technology, the claims must recite the details regarding how a computer aids the method, the extent to which the computer aids the method, or the significance of a computer to the performance of the method. Merely adding generic computer components to perform the method is not sufficient. Thus, the claim must include more than mere instructions to perform the method on a generic component or machinery to qualify as an improvement to an existing technology. (emphasis added). 10 Because the Examiner has changed the thrust of the §101 rejection in the Answer and made it a new ground of rejection, we consider Appellant’s responsive arguments in the Reply Brief as timely. Appeal 2018-007022 Application 12/408,449 21 Here, Appellant has not provided sufficient details regarding how a computer aids the method, the extent to which the computer aids the method, or the significance of a computer to the performance of the method. See Id. Moreover, we conclude Appellant’s generic computer implementation performs steps that can be performed alternatively as mental processes, or represent a method of organizing human activities, such as a fundamental economic practice, as discussed above. Accordingly, on this record, we conclude independent claim 27 does not recite an improvement to the functionality of a computer or other technology or technical field. See MPEP § 2106.05(a). MPEP §§ 2106.05(b) and (c) The Bilski Machine-or-Transformation test (“MoT”) as applied to method claims At the outset, we note the Supreme Court cautions that the MoT test is not the sole test, but may provide a useful clue: This Court’s precedents establish that the machine-or- transformation test is a useful and important clue, an investigative tool, for determining whether some claimed inventions are processes under § 101. The machine-or- transformation test is not the sole test for deciding whether an invention is a patent-eligible “process.” Bilski, 561 U.S. at 604 (emphasis added). Here, Appellant argues the method claims are tied to one or more “particular” machines: Particular, non-generic, machines/computers are necessary to implement the systems and methods of the claims. For example, a server capable of implementing the systems and methods must be able to communicate digital data with a multitude of differing financial networks and their associated Appeal 2018-007022 Application 12/408,449 22 protocols. Off-the-shelf generic computers are not capable of performing such functions, much less concurrently during an period of intense heavy transaction load as may be necessary in such industry. Combined, these aspects are not typical of generic computers. Reply Br. 3. However, Appellant provides no evidence in support. Contrary to Appellant’s arguments, the Specification, paragraph 29 describes: “the present invention provides a computer readable memory storing statements and instructions for execution by a computer to perform any of the methods described herein.” (emphasis added). See also Spec. ¶ 38 that provides a similar supporting description. We observe that all claims 27–38 on appeal are method claims. Applying a broad but reasonable interpretation to the additional non-abstract limitations of the merchant system, risk processing system, administrative system and bill payment system (claim 27), and in accordance with the generic “computer readable memory . . . [that stores] statements and instructions for execution by a computer to perform the steps of methods described herein” (Spec. ¶ 38, emphasis added), we conclude one or more generic computers are implicit in the performance of method claims 27–38 on appeal. Therefore, on this record, we conclude method claims 27–38 do not define or rely upon a “particular machine.” See MPEP § 2106.05(b). Further, Appellant advances no arguments asserting that method claims 27–38 transform an article to a different state or thing. See MPEP § 2106.05(c). Appeal 2018-007022 Application 12/408,449 23 To the extent that the method claims on appeal might arguendo effect a transformation of data, we note the “[t]ransformation and reduction of an article ‘to a different state or thing’ is the clue to the patentability of a process claim that does not include particular machines.” Gottschalk v. Benson, 409 U.S. at 70. “The mere manipulation or reorganization of data, however, does not satisfy the transformation prong.” CyberSource, 654 F.3d at 1375. Accordingly, we conclude Appellant has not established that method claims 27–38 use a “particular machine” to apply the judicial exception (see MPEP § 2106.05(b)), or perform a transformation of an article to a different state or thing (see MPEP § 2106.05(c)). MPEP § 2106.05(e) — Meaningful Claim Limitations 11 We see nothing in Appellant’s claims that specifically improves the efficiency of the computer, or another technology or technical field, as addressed above under MPEP § 2106.05(a). Appellant does not advance substantive, persuasive arguments as to any particular additional “meaningful” claim limitations, such as those of the types addressed under MPEP § 2106.05(e), that impose meaningful limits on the judicial exception. Accordingly, on this record, we conclude representative claim 27 has no 11 MPEP § 2106.05(e): “Applying or using 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.” (emphasis added). Appeal 2018-007022 Application 12/408,449 24 other argued meaningful limitations, as considered under section 2106.05(e) of the MPEP, pursuant to the 2019 Revised Guidance. MPEP § 2106.05(f) Merely including instructions to implement an abstract idea on a computer, or Merely using a computer as a tool to perform an abstract idea As noted above, the Specification, paragraph 29 describes: “the present invention provides a computer readable memory storing statements and instructions for execution by a computer to perform any of the methods described herein.” (emphasis added). See also Spec. ¶ 38 that provides a similar description. Therefore, on this record, we conclude Appellant’s claimed invention merely implements the abstract idea using instructions executed on generic computer components, as depicted in bold type in Table One, and as supported in our reproduction of the Specification, paragraphs 29 and 38, supra. Thus, we conclude Appellant’s claims merely use a computer as a tool to perform an abstract idea. MPEP § 2106.05(g) Adding insignificant extra-solution activity to the judicial exception As mapped in the right column of Table One, supra, we conclude representative independent claim 27 recites extra or post-solution activities that courts have determined to be insufficient to transform judicially excepted subject matter into a patent-eligible application. See MPEP § 2106.05(g); 84 Fed. Reg. at 55 n.31. Appeal 2018-007022 Application 12/408,449 25 MPEP § 2106.05(h) Generally linking the use of the judicial exception to a particular technological environment or field of use The Supreme Court guides: “the prohibition against patenting abstract ideas ‘cannot be circumvented by attempting to limit the use of the formula to a particular technological environment’ or [by] adding ‘insignificant post solution activity.’” Bilski, 561 U.S. at 611–12, (quoting Diamond v. Diehr, 450 U.S. 175, 191–92 (1981)). We have identified the specific claim limitations that recite insignificant extra or post-solution activity above in Table One of claim 27. Preemption In reviewing the record, we note the preemption issue was addressed by the Examiner on page 3 of the Final Office Action in response to Appellant’s earlier arguments. As our reviewing court has explained, “questions on preemption are inherent in and resolved by the § 101 analysis,” and, although “preemption may signal patent ineligible subject matter, the absence of complete preemption does not demonstrate patent eligibility.” Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir. 2015); cf. OIP Techs, 788 F.3d at 1362–63 (“[T]hat the claims do not preempt all price optimization or may be limited to price optimization in the e-commerce setting do not make them any less abstract.”). Nor do method claims 27–38 on appeal present any other issues as set forth in the 2019 Revised Guidance regarding a determination of whether the additional generic elements integrate the judicial exception into a practical application. See Revised Guidance, 84 Fed. Reg. at 55. Appeal 2018-007022 Application 12/408,449 26 Thus, under Step 2A, Prong Two (MPEP §§ 2106.05(a)–(c) and (e)– (h)), we conclude claims 27–38 do not integrate the judicial exception into a practical application. Therefore, we proceed to Step 2B, The Inventive Concept. The Inventive Concept – Step 2B Under the 2019 Revised Guidance, only if a claim: (1) recites a judicial exception, and (2) does not integrate that exception into a practical application, do we then look to whether the claim adds a specific limitation beyond the judicial exception that is not “well-understood, routine, conventional” in the field (see MPEP § 2106.05(d)); or, simply appends well-understood, routine, conventional activities previously known to the industry, specified at a high level of generality, to the judicial exception. In setting forth the new ground of rejection in the Answer, the Examiner finds: The claim also defines the order information and what the non- confidential purchaser information is not. The recited definitions are well-understood, routine and conventional to one of ordinary skill and thus do not add significantly more to the abstract idea. The claim also recites a merchant system, a risk processing system and an administration system. The systems are interpreted as generic devices programmed to perform the specific operations as disclosed in Para[graphs] 0153-0154 of the published specification. Such implementation using generic devices is not sufficient to transform the claims into patent-eligible subject matter. Ans. 3 (emphasis added). Appeal 2018-007022 Application 12/408,449 27 In response, the Appellant argues in the Reply Brief: Each of claims 27 and 36-38 includes specific limitations other than what is well-understood, routine and conventional in the field, or add unconventional steps that confine the claim to a particular useful application. The Office Action admits this implicitly because these claims do not stand rejected under §102 or §103. The Interim Guidance states that “[r]egardless of whether a rejection under 35 U.S.C. 101 is made, a complete examination should be made for every claim under each of the other patentability requirements: 35 U.S.C. 102, 103, [etc.].” As such, the Appellant must conclude that the Office has determined that claims 27 and 36-38 are novel and non-obvious over any prior art of record (and other references identified in the Examiner’s search). Novel and nonobvious claims, by their very definition, must include limitations other than what is well-understood, routine, and conventional in the field, or else they wouldn’t be novel and non-obvious. Because the alleged abstract idea has been labeled a fundamental economic practice by the Office Action, novelty and nonobviousness cannot lie within that portion of the claim, as fundamental economic practices (the presumed type of abstract idea, though the Office Action does not state) are “long prevalent in our system and taught in any introductory finance class” (Alice, 573 U.S._ at p. 9). Consequently, something besides the alleged abstract idea in the claims must be novel and non-obvious, and therefore significantly more than the alleged abstract idea is present in the claim. App. Br. 4. However, any analysis based upon anticipation (or obviousness) is not relevant to our analysis for patent eligibility under 35 U.S.C. § 101. Although the second step in the Alice/Mayo test is a search for an “inventive concept,” the analysis is not directed to novelty or nonobviousness, but rather searches for elements sufficient to ensure that the claimed invention is directed to more than a patent ineligible concept, such as an abstract idea. Appeal 2018-007022 Application 12/408,449 28 See Alice, 573 U.S. at 217–18. “Groundbreaking, innovative, or even brilliant discovery does not by itself satisfy the § 101 inquiry.” Ass’n for Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. 576, 591 (2013); see also Diamond v. Diehr, 450 U.S. 175, 188–89 (1981) (“The ‘novelty’ of any element or steps in a process, or even of the process itself, is of no relevance in determining whether the subject matter of a claim falls within the § 101 categories of possibly patentable subject matter.”); Affinity Labs of Tex., LLC v. DIRECTV, LLC, 838 F.3d 1253, 1263 n.3 (Fed. Cir. 2016) (noting that an eligibility finding does not turn on the novelty of using a user-downloadable application for the particular purpose recited in the claims). Further, regarding the use of the recited generic computer components identified above in Table One, and as found by the Examiner (Ans. 3), the Supreme Court has held “the mere recitation of a generic computer cannot transform a patent-ineligible abstract idea into a patent-eligible invention.” Alice, 573 U.S. at 223. Our reviewing court provides additional guidance: See FairWarning, 839 F.3d at 1096 (“[T]he use of generic computer elements like a microprocessor or user interface do not alone transform an otherwise abstract idea into patent-eligible subject matter.”); OIP Techs., 788 F.3d at 1363 (claims reciting, inter alia, sending messages over a network, gathering statistics, using a computerized system to automatically determine an estimated outcome, and presenting offers to potential customers found to merely recite “‘well-understood, routine conventional activit[ies],’ either by requiring conventional computer activities or routine data-gathering steps” (alteration in original)). Appeal 2018-007022 Application 12/408,449 29 This reasoning is applicable here. Therefore, on the record before us, Appellant has not shown that the claims on appeal add a specific limitation beyond the judicial exception that is not “well-understood, routine, and conventional” in the field (see MPEP § 2106.05(d)). In light of the foregoing, we conclude, under the 2019 Revised Guidance, that each of Appellant’s claims 27–38, considered as a whole, is directed to a patent-ineligible abstract idea that is not integrated into a practical application, and does not include an inventive concept. Accordingly, for the reasons discussed above, we sustain the Examiner’s Rejection under 35 U.S.C. § 101 of claims 27–38.12 CONCLUSIONS For the reasons discussed above, we are persuaded the Examiner erred regarding Rejection A of claims 27–38 under pre-AIA 35 U.S.C. § 112, first paragraph (written description). However, under our Revised Guidance, as governed by relevant case law, we are not persuaded the Examiner erred regarding Rejection B of claims 27–38 under 35 U.S.C. § 101, as being directed to patent-ineligible subject matter. 12 To the extent Appellant has not advanced separate, substantive arguments for particular claims, or other issues, such arguments are waived. See 37 C.F.R. § 41.37(c)(1)(iv). Appeal 2018-007022 Application 12/408,449 30 DECISION SUMMARY FINALITY AND RESPONSE Because we have affirmed at least one ground of rejection with respect to each claim on appeal, the Examiner’s decision is affirmed. See 37 C.F.R. § 41.50(a)(1). No time period for taking any subsequent action in connection with this appeal may be extended under 37 C.F.R. § 1.136(a)(1)(iv). See 37 C.F.R. § 41.50(f). AFFIRMED Claims Rejected 35 U.S.C. § Basis Affirmed Reversed 27–38 pre-AIA 112, first paragraph Written Description 27–38 27–38 101 Eligibility 27–38 Overall Outcome 27–38 Copy with citationCopy as parenthetical citation