Stephen Seawall

Patent Trials and Appeals Board

May 28, 2020

13792110 - (D) (P.T.A.B. May. 28, 2020)

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.
13/792,110 03/10/2013 Stephen L. Seawall SEAW-001 3790
68371 7590 05/28/2020
DEEPAK MALHOTRA
MALHOTRA LAW FIRM, PLLC
P.O. BOX 1433
SPOKANE, WA 99210
EXAMINER
CHEIN, ALLEN C
ART UNIT PAPER NUMBER
3687
NOTIFICATION DATE DELIVERY MODE
05/28/2020 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):
dmalhotra@patentsusa.com
docketing@patentsusa.com
malhotraspokane@hotmail.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte STEPHEN L. SEAWALL
Appeal 2020-000565
Application 13/792,110
Technology Center 3600
Before JOHN A. EVANS, CATHERINE SHIANG, and
SCOTT B. HOWARD, Administrative Patent Judges.
HOWARD, Administrative Patent Judge.
DECISION ON APPEAL
STATEMENT OF THE CASE
Pursuant to 35 U.S.C. § 134(a), Appellant1 appeals from the
Examiner’s decision to reject claims 1, 2, and 5–20. Claims 3 and 4 have
been cancelled. See Final Act. 1. We have jurisdiction under
35 U.S.C. § 6(b).
We AFFIRM.

1 We use the word Appellant to refer to “applicant” as defined in 37 C.F.R.
§ 1.42. Appellant identifies the real party in interest as Stephen L. Seawall.
Appeal Br. 3.
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2
CLAIMED SUBJECT MATTER
The claims are directed to “accounting data management, and
accounting systems and methods.” Spec. ¶ 1. Claim 1, reproduced below
with emphases added, is illustrative of the claimed subject matter:
1. A computerized accounting system comprising a memory
defining a data warehouse, the data warehouse being defined as
a plurality of logical accounting and reporting sub-systems
which have different functions, including recording and retrieval
of data, the sub-systems being configured to record single entry
transactions, the single entry transactions including transactions
for a business entity and for a subsidiary of the business entity, a
processor in communication with the memory, and a
communications interface coupled to the processor and memory,
for user input, the system being configured to record single entry
transactions, in the data warehouse, including transactions for
cash receipts, cash disbursements, accounts payable, payroll
payable, and legal commitments and to selectively generate,
using the processor, a cash basis statement including, for a
period, beginning cash balance, cash receipts, cash
disbursements, and ending cash balance, the cash basis
statement being for a selected one of the business entity and the
subsidiary of the business entity;
wherein the system is further configured to selectively
generate, using the transactions for accounts payable, the
payroll payable, and the legal commitments, a budgetary basis
statement including, for a period, beginning uncommitted cash,
receipts, expenditures, including legal commitments, and
uncommitted cash, the budgetary basis statement being for a
selected one of the business entity and the subsidiary of the
business entity;
wherein the system is further configured to selectively
generate a tax cash basis statement, the tax cash basis statement
being for a selected one of the business entity and the subsidiary
of the business entity;
wherein the data warehouse includes data defining
accounts, wherein the data warehouse includes a chart of
accounts configured to map detailed transaction codes to
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different of the accounts, and wherein the data warehouse further
includes a general ledger configured to store data concerning
the accounts as double entries, wherein the transactions include
cash basis transactions stored as single entry data and
configured, in response to a request, to generate an unadjusted
cash basis trial balance by extracting single entry cash
transactions for a reporting period from the data warehouse, by
summarizing the extracted single entry cash transactions by
detailed transaction code, by identifying each detailed
transaction code and summarized amount, by determining the
general ledger account each detailed transaction code is mapped
to by using the chart of accounts, by converting the single entry
data to double entries, by identifying and tagging double entries
that require adjusting entries, and by adding the double entries
to the general ledger thereby creating an unadjusted cash basis
trial balance ready for adjusting entries, to receive adjusting
entries from a user, and to generate, for at least one of the
business entity and the subsidiary of the business entity, at least
one of accrual basis and tax accrual basis statements using the
unadjusted cash basis trial balance and the adjusting entries;
wherein less memory is required to generate a cash basis,
tax cash basis, or budgetary basis statement than if transactions
for cash receipts, cash disbursements, accounts payable, payroll
payable, and legal commitments were stored in a double entry
format.
REJECTION
Claims 1, 2, and 5–20 are rejected under 35 U.S.C. § 101 as directed
to patent ineligible subject matter. Final Act. 10.
OPINION
We have reviewed the Examiner’s rejection in light of Appellant’s
arguments that the Examiner erred. In reaching this decision, we have
considered all evidence presented and all arguments made by Appellant. We
are not persuaded by Appellant’s arguments regarding claims 1, 2, and 5–20.
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A. Section 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 U.S. 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. E.g., Alice Corp. v. CLS Bank Int’l, 573
U.S. 208, 216 (2014).
In determining whether a claim falls within an excluded category, we
are guided by the Court’s two-part framework, described in Mayo and Alice.
Id. at 217–18 (citing Mayo Collaborative Servs. v. Prometheus Labs., Inc.,
566 U.S. 66, 75–77 (2012)). 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.”); 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.”).
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, 67 (1972)). Concepts
determined to be patent eligible include physical and chemical processes,
such as “molding rubber products” (Diamond v. Diehr, 450 U.S. 175, 191
(1981)); “tanning, dyeing, making waterproof cloth, vulcanizing India
rubber, smelting ores” (id. at 182 n.7 (quoting Corning v. Burden, 56 U.S.
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252, 267–68 (1853))); 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
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 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. (citation omitted)
(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.”).
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 (quotation marks 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.
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B. USPTO Section 101 Guidance
In January 2019, the U.S. Patent and Trademark Office (USPTO)
published revised guidance on the application of § 101. 2019 Revised Patent
Subject Matter Eligibility Guidance, 84 Fed. Reg. 50 (Jan. 7, 2019)
(“2019 Revised Guidance”).2 “All USPTO personnel are, as a matter of
internal agency management, expected to follow the guidance.” Id. at 51;
see also October 2019 Update at 1.
Under the 2019 Revised Guidance and the October 2019 Update, we
first look to whether the claim recites:
(1) any judicial exceptions, including certain groupings of abstract
ideas (i.e., mathematical concepts, certain methods of organizing
human activity such as a fundamental economic practice, or mental
processes) (“Step 2A, Prong One”); and
(2) additional elements that integrate the judicial exception into a
practical application (see MPEP § 2106.05(a)–(c), (e)–(h) (9th ed.
Rev. 08.2017, Jan. 2018)) (“Step 2A, Prong Two”).3
2019 Revised Guidance, 84 Fed. Reg. at 52–55.

2 In response to received public comments, the Office issued further
guidance on October 17, 2019, clarifying the 2019 Revised Guidance.
USPTO, October 2019 Update: Subject Matter Eligibility (the “October
2019 Update”) (available at https://www.uspto.gov/sites/default/files/
documents/peg_oct_2019_update.pdf).
3 This evaluation is performed by (a) identifying whether there are any
additional elements recited in the claim beyond the judicial exception, and
(b) evaluating those additional elements individually and in combination to
determine whether the claim as a whole integrates the exception into a
practical application. See 2019 Revised Guidance - Section III(A)(2), 84
Fed. Reg. 54–55.
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Only if a claim (1) recites a judicial exception and (2) does not
integrate that exception into a practical application, do we then look, under
Step 2B, 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, conventional activities
previously known to the industry, specified at a high level of
generality, to the judicial exception.
2019 Revised Guidance, 84 Fed. Reg. at 52–56.
USPTO STEP 2A, PRONG 1
The Examiner concludes that claim 1 is directed to accounting, which
is a fundamental economic practice and a method of organizing human
activity. Final Act. 12; Ans. 4–5.
Appellant argues the Examiner applied “an unreasonably high level of
abstraction to claim 1.” Appeal Br. 11.
We are not persuaded by Appellant’s arguments that the Examiner
erred. The emphasized limitations in the recitation of claim 1 above, under
their broadest reasonable interpretation, recite an accounting system because
the various limitations recite the steps that would ordinarily be used in an
accounting system.
For example, the preamble explicitly recites that the claim is an
accounting system. The remainder of the emphasized limitations recite
various details regarding the how data is entered into the accounting system
and how that data is used to generate accounting reports. An accounting
system is used by various entities to keep track of economic activity. Thus,
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like the concept of intermediated settlement in Alice, and the concept of
hedging in Bilski, the concept of an accounting system recited in Appellants'
claims “is a fundamental economic practice long prevalent in our system of
commerce.” Alice, 573 U.S. at 216 (citations and internal quotation marks
omitted). Accordingly, we conclude the claims recite a fundamental
economic practice, which is one of certain methods of organizing human
activity identified in the Revised Guidance, and thus an abstract idea.
We do not agree with Appellant’s argument that the Examiner used
too high a level of abstraction. Both the title and field of the invention make
it clear that the claimed invention is directed to methods of financial
accounting. Spec. ¶ 1, Title. Similarly, the preamble of claim recites the
claim is for an “accounting system.” And, as discussed above, the specific
limitations of the claims recite various properties of an accounting system
such as the type of data used and the type of reports that can be generated.4
D. USPTO STEP 2A, PRONG 2
In determining whether claim 1 is “directed to” the identified abstract
ideas, we next consider whether claim 1 recites additional elements that
integrate the judicial exception into a practical application. For the reasons
set forth below, we discern no additional element (or combination of
elements) recited in claim 1 that integrates the judicial exception into a
practical application. See 2019 Revised Guidance, 84 Fed. Reg. at 54–55.

4 Appellant also argues that the claim is not directed to a mental process.
See Appeal Br. 17–18. Because we do not rely on the Examiners’
determination that the claim is directed to a mental process, those arguments
are moot.
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Appellant argues that claim 1 is directed to a “practical application:
the capability of generating financing statements using different bases of
accounting.” Reply Br. 5. Appellant also argues that the claims a computer
memory improvement. Appeal Br. 54–55 (citing Spec. ¶ 125); Reply Br. 4.
Appellant further argues that the claims of the instant application are similar
to the claims found patent eligible in Enfish, LLC v. Microsoft Corp., 822
F.3d 1327 (Fed. Cir. 2016). Id. at 11–14.
We do not agree. Although claim 1 recites using “less memory” than
if the data was stored in a double entry format, that is merely describing the
results of the abstract idea. The claim does not recite any improvement in
computer functionality that achieves that result. An improvement in an
abstract idea, as opposed to the improvement of computer functionality, is
not sufficient to show that the abstract idea is integrated into a practical
application. See MPEP 2106.05(f) (“Use of a computer or other machinery
in its ordinary capacity for economic or other tasks (e.g., to receive, store, or
transmit data) or simply adding a general purpose computer or computer
components after the fact to an abstract idea (e.g., a fundamental economic
practice or mathematical equation) does not provide significantly more.”).
Moreover, Appellant has not persuasively shown how the
Specification supports using less memory. Appellant directs us to paragraph
125, which is reproduced in its entirety:
As described above, there are typically transactions in the cash
basis trial balance that are not actually accrual basis revenues and
expenses. However, the system 30 uses tagging to identify such
transactions as possibly requiring an adjusting entry under
accrual basis reporting requirements.
Nothing in that paragraph discusses how much memory will be used and
Appellant has not presented any persuasive argument or evidence in support
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of its position. Attorney argument unsupported by evidence is not sufficient
to show such an improvement. In re Geisler, 116 F.3d 1465, 1470 (Fed. Cir.
1997); see also In re Pearson, 494 F.2d 1399, 1405 (CCPA 1974) (attorney
argument is not evidence).
Rather, the Specification simply describes using conventional
computer components—such as servers, computers, processors, and
networks. See Spec. ¶ 37; see also Ans. 4 (“This is not persuasive, because
the additional elements of Appellant's invention are only generic computing
components and a conventional memory improvement.”). Accordingly,
claim 1 simply “includes instructions to implement an abstract idea on a
computer, or merely uses a computer as a tool to perform an abstract idea.”
See 2019 Revised Guidance, 84 Fed. Reg. at 55.
We also disagree with Appellant that claim 1 is similar to the claims
found patent eligible in Enfish. In Enfish, the claims were “directed to a
specific improvement to the way computers operate.” 822 F.3d at 1336.
Specifically, in Enfish, “the claims are not simply directed to any form of
storing tabular data, but instead are specifically directed to a self-
referential table for a computer database.” Id. at 1337. Moreover, the
specification made it clear that the invention improved the functioning of the
computer. Id.
In this case, unlike in Enfish, the claims are not directed to improving
the functioning of the computer. Rather, the claims are directed to a “new”
accounting system that uses single entry transactions while tagging those
transactions that may requires “adjusting” when preparing a report. See
Spec. ¶¶ 15–16. That is, the claims are not directed to an improvement in
technology and the operation of a computer, but to using technology to
implement a financial accounting system.
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Accordingly, we are not persuaded of error in the Examiner’s
determination that claim 1 is directed to an abstract idea, and we find the
claimed additional elements do not integrate the abstract idea into a practical
application.
E. USPTO STEP 2B
Turning to step 2B of the 2019 Revised Guidance, we look to whether
claim 1 (a) adds a specific limitation or combination of limitations that are
not well-understood, routine, conventional activity in the field, or (b) simply
appends well-understood, routine, conventional activities previously known
to the industry, specified at a high level of generality, to the judicial
exception. 2019 Revised Guidance, 84 Fed. Reg. at 56.
The Examiner determines that “Appellant’s additional elements
appear to largely comprise generic computing or data storage elements,
which is used to implement an abstract accounting process. This does not
lend itself to patent eligibility.” Ans. 5 (citing MPEP 2106.05(f)).
Appellant argues that the Examiner did not make sufficient findings in
light of Berkheimer.5 Appeal Br. 14–17; Reply Br. 3. Appellant also argue
that the claim is not directed to conventional single entry accounting; instead
Appellant argues that the claim is directed to significantly more than the
abstract idea. See Appeal Br. 20–47.

5 Berkheimer v. HP Inc., 890 F.3d 1369, 1376 (Fed. Cir. 2018) and USPTO
Memorandum of April 19, 2018, “Changes in Examination Procedure
Pertaining to Subject Matter Eligibility, Recent Subject Matter Eligibility
Decision (Berkheimer v. HP, Inc.)” (Apr. 19, 2018), available at
https://www.uspto.gov/sites/default/files/documents/memo-berkheimer-
20180419.PDF (hereinafter “USPTO Berkheimer Memorandum”).
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Appellant does not direct our attention to anything in the Specification
that indicates the claimed computer components—whether considered
individually or as an ordered combination—perform anything other than
well-understood, routine, and conventional functions, such as collecting
data, transmitting data, and manipulating data (i.e., associating the ordering
scheme with an identifier, and determining to place the purchase order).
Those types of generic computer components performing generic computer
functions—both individually and in combination—have been found to be
well understood, routine, and conventional. See, e.g., Elec. Power Grp.,
LLC v. Alstom S.A., 830 F.3d 1350, 1355 (Fed. Cir. 2016) (“Nothing in the
claims, understood in light of the specification, requires anything other than
off-the-shelf, conventional computer, network, and display technology for
gathering, sending, and presenting the desired information”); buySAFE, Inc.
v. Google, Inc., 765 F.3d 1350, 1355 (Fed. Cir. 2014) (“That a computer
receives and sends the information over a network—with no further
specification—is not even arguably inventive”); In re TLI Commc’ns LLC
Patent Litig., 823 F.3d 607, 614 (Fed. Cir. 2016) (server that receives data,
extracts classification information from the received data, and stores the
digital images insufficient to add an inventive concept); Alice, 573 U.S. at
225–26 (receiving, storing, sending information over networks insufficient
to add an inventive concept); CyberSource Corp. v. Retail Decisions, Inc.,
654 F.3d 1366, 1370 (Fed. Cir. 2011) (use of Internet to verify credit-card
transaction does not add enough to abstract idea of verifying the
transaction); see also MPEP § 2106.05(d) (“Courts have held computer‐
implemented processes not to be significantly more than an abstract idea
(and thus ineligible) where the claim as a whole amounts to nothing more
than generic computer functions merely used to implement an abstract idea,
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such as an idea that could be done by a human analog (i.e., by hand or by
merely thinking.”)).
We also do not we find Appellant’s arguments directed to “something
more” persuasive. Appellant devotes a significant portion of the Appeal
Brief discussing the differences between the claimed accounting system and
single entry accounting. See Appeal Brief 20–47. However, those
arguments focus on the improvement of the abstract idea, not the additional
elements. A “claimed invention’s use of the ineligible concept,” e.g., an
abstract idea, “cannot supply the inventive concept that renders the invention
‘significantly more’ than that ineligible concept.” BSG Tech LLC v.
BuySeasons, Inc., 899 F.3d 1281, 1290 (Fed. Cir. 2018). “[U]nder the
Mayo/Alice framework, a claim directed to a newly discovered” abstract idea
“cannot rely on the novelty of that discovery for the inventive concept
necessary for patent eligibility.” Genetic Techs. Ltd. v. Merial L.L.C.,
818 F.3d 1369, 1376 (Fed. Cir. 2016).
F. ADDITIONAL ARGUMENTS
In addition to the arguments premised on the Alice/Mayo Framework
as reflected in the Revised Guidance, Appellant presents two additional
arguments. First, Appellant argues that the claims are patent eligible
because they do not preempt a broad field of accounting. Appeal Br. 18–20.
Second Appellant argues that granting some patent for accounting systems
and not the instant application is a violation of the Fourteenth Amendment.
Id. at 18.
We are not persuaded by either argument.
With regard to preemption, although the extent of preemption is a
consideration, the absence of complete preemption is not dispositive. See,
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e.g., Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, 1379 (Fed.
Cir. 2015) (“While preemption may signal patent ineligible subject matter,
the absence of complete preemption does not demonstrate patent
eligibility.”); Ultramercial, Inc. v. Hulu, LLC, 722 F.3d 1335, 1346 (Fed.
Cir. 2013) (“[T]he Supreme Court has stated that, even if a claim does not
wholly pre-empt an abstract idea, it still will not be limited meaningfully if it
contains only insignificant or token pre- or post-solution activity—such as
identifying a relevant audience, a category of use, field of use, or
technological environment.”) (citations omitted), vacated and remanded,
WildTangent, Inc. v. Ultramercial, LLC, 134 S. Ct. 2870 (2014) (remanding
for consideration in light of Alice, 134 S. Ct. 2347).
Similarly, we do not find Appellant’s Fourteenth Amendment
argument persuasive. The gravamen of Appellant’s argument is that
Appellant is being treated different than other patent applicants. See Appeal
Br. 14. However, the Appeal Brief does not persuasively demonstrate
unequal treatment. There is no discussion of the similarities or differences
between the allowed claims and the claims of the instant application. Id.
Nor is there a discussion of differences in the prosecution. Id. Accordingly,
Appellant has not shown sufficiently shown any disparate treatment or a
violation of the Fourteenth Amendment.
Moreover, the only case cited by Appellant—Bolling v. Sharpe, 347
U.S. 497 (1954)—is inapposite. In Bolling, the Supreme Court held that the
due process clause of the Fifth Amendment prohibited race based
discrimination in the District of Columbia’s school systems. 347 U.S. at
498–99. It is unclear, based on Appellant’s arguments how the Court’s
holding “that racial segregation in the public schools of the District of
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Columbia is a denial of the due process of law guaranteed by the Fifth
Amendment to the Constitution” applies to the facts of this case. Id. at 500.
G. CLAIMS 12, 16, AND 17
Appellant present additional, separate arguments for independent
claims 12, 16, and 17. Specifically, Appellant identifies an additional
limitation in each claim and argues the Examiner did not make sufficient
findings based on Berkheimer.
We do not find those arguments persuasive. The additional limitation
Appellant focuses on for claims 12 and 17 and just further aspects of the
abstract idea. Accordingly, because those limitations are part of the abstract
idea and not part of the additional elements, Bekrheimer is not applicable.
See Berkheimer Memo at 2.
With regard to claim 16, Appellant focuses on the use of less memory.
Appellant’s argument is not persuasive for the same reasons discussed above
with regard to claim 1.
H. CONCLUSION ON SECTION 101 REJECTION
Appellant does not separately argue claims 2, 5–11, 13–15, and 18–
20. Accordingly, those claims are considered as grouped with claim 1.
Accordingly, we sustain the § 101 rejection of claims 1, 2 and 5–10 as
being directed to patent-ineligible subject matter.

CONCLUSION
We affirm the Examiner’s § 101 rejection of claims 1, 2, and 5–20.
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DECISION SUMMARY
Claims
Rejected
35 U.S.C. § Reference(s)/Basis Affirmed Reversed
1, 2, 35–20 101 Eligibility 1, 2, 5–20

TIME PERIOD FOR RESPONSE
No time period for taking any subsequent action in connection with
this appeal may be extended under 37 C.F.R. § 1.136(a). See 37 C.F.R.
§ 1.136(a)(1)(iv).
AFFIRMED