Alfred J. Brignull et al.

Patent Trials and Appeals Board

Sep 3, 2019

12325471 - (D) (P.T.A.B. Sep. 3, 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.
12/325,471 12/01/2008 Alfred J. BRIGNULL END920070462US1 1568
46583 7590 09/03/2019
Roberts Mlotkowski Safran Cole & Calderon, P.C.
Intellectual Property Department
P.O. Box 10064
MCLEAN, VA 22102-8064
EXAMINER
SORKOWITZ, DANIEL M
ART UNIT PAPER NUMBER
3681
NOTIFICATION DATE DELIVERY MODE
09/03/2019 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):
docketing@rmsc2.com
lgallaugher@rmsc2.com
secretaries@rmsc2.com
PTOL-90A (Rev. 04/07)

UNITED STATES PATENT AND TRADEMARK OFFICE
____________________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________________

Ex parte ALFRED J. BRIGNULL, MICHELE P. BRIGNULL,
RICK A. HAMILTON II, ANNE R. SAND,
and JAMES W. SEAMAN
____________________

Appeal 2018-004602
Application 12/325,4711
Technology Center 3600
____________________

Before JENNIFER S. BISK, LARRY J. HUME, and
JULIET MITCHELL DIRBA, Administrative Patent Judges.

HUME, Administrative Patent Judge.

DECISION ON APPEAL
This is a decision on appeal under 35 U.S.C. § 134(a) of the Final
Rejection of claims 1, 2, 8, 12–17, 19–22, 24–27, 29, 30, and 32, which are
all claims pending in the application. Appellants have canceled claims 3–7,
9–11, 18, 23, 28, and 31. We have jurisdiction under 35 U.S.C. § 6(b).
We AFFIRM.

1 According to Appellants, the real party in interest is International Business
Machines Corporation. App. Br. 2.
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STATEMENT OF THE CASE2
The Invention
Appellants’ disclosed embodiments and claimed invention relate to “a
system and method to dynamically place products in a virtual universe.” See
Title. Specifically, “[t]he invention generally relates to a system and method
to dynamically place products in a virtual universe and, in particular, to
dynamically place products in a virtual universe based on an entity’s
budget.” Spec. ¶ 1.
Exemplary Claim
Claim 8, reproduced below, is representative of the subject matter on
appeal:
8. A method implemented on a computing
infrastructure for placing items in a virtual universe comprising:
ascertaining a cost associated with displaying at least one
item at one or more locations in the virtual universe, wherein
the one or more locations is a display area of the virtual
universe for rent, sub-let, assignment, or purchase by a user of
the virtual universe, wherein the cost associated with displaying
the at least one item at one or more locations is calculated from
a cost rating and a price charged by a location owner, the cost
rating being based on one or more cost weightings related to
economic trends and the price charged by the location owner
being based on a type of purchase, lease, or rental agreement in
the virtual universe;

2 Our decision relies upon Appellants’ Appeal Brief (“App. Br.,” filed Nov.
17, 2017); Reply Brief (“Reply Br.,” filed Mar. 30, 2018); Examiner’s
Answer (“Ans.,” mailed Feb. 8, 2018); Final Office Action (“Final Act.,”
mailed June 23, 2017); and the original Specification (“Spec.,” filed Dec. 1,
2008).
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relaying information about the cost to the user, thereby
allowing the user to select at least one of the one or more
locations that fit a user’s budget;
providing an additional scenario by increasing the user’s
budget, increasing a number of items of the at least one item,
and displaying the at least one item at a back location of the one
or more locations;
dynamically partitioning the one or more locations into
one or more additional locations in the virtual universe;
recognizing the one or more additional locations and
contacting the user about offering the one or more additional
locations for rent, sub-let, assignment, or purchase to another
user of the virtual universe; and
dynamically determining when the number of items of
the at least one item is below a predetermined level such that an
excess space of the one or more locations is available to sub-let,
wherein the dynamic partitioning is performed by a processor.
Rejections on Appeal
Claims 1, 2, 8, 12–17, 19–22, 24–30, and 32 stand rejected under 35
U.S.C. § 101 as being directed to patent-ineligible subject matter. Final
Act. 2–5.
CLAIM GROUPING
Based on Appellants’ arguments (App. Br. 6–43) and our discretion
under 37 C.F.R. § 41.37(c)(1)(iv), we decide the appeal of patent-ineligible
subject matter Rejection of claims 1, 2, 8, 12–17, 19–22, 24–30, and 32, on
the basis of representative claim 8.3

3 “Notwithstanding any other provision of this paragraph, the failure of
appellant to separately argue claims which appellant has grouped together
shall constitute a waiver of any argument that the Board must consider the
patentability of any grouped claim separately.” 37 C.F.R. § 41.37(c)(1)(iv).
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ISSUE
Appellants argue (App. Br. 6–43; Reply Br. 2–12) the Examiner’s
rejection of claim 8 under 35 U.S.C. § 101 as being directed to patent-
ineligible subject matter is in error. These contentions present us with the
following issue:
Under the USPTO’s Revised Guidance, informed by our governing
case law concerning 35 U.S.C. § 101, is claim 8 patent-ineligible under
§ 101?
PRINCIPLES OF LAW
A. 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. § 101.4
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) (brackets in original) (citing 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

In addition, when Appellants do not separately argue the patentability of
dependent claims, the claims stand or fall with the claims from which they
depend. In re King, 801 F.2d 1324, 1325 (Fed. Cir. 1986).
4 This threshold analysis of whether a claim is directed to one of the four
statutory categories of invention, i.e., a process, machine, manufacture, or
composition of matter, is referred to as “Step 1” in the USPTO’s patent-
eligibility analysis under § 101. MPEP § 2106.
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and Alice. Alice Corp. 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.”); 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” (Diehr, 450 U.S. at 191); “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 “[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
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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.”).
Abstract ideas may include, but are not limited to, fundamental
economic practices, methods of organizing human activities, and
mathematical formulas or relationships. Alice, 573 U.S. at 217–21. Under
this guidance, we must therefore ensure at step one that we articulate what
the claims are directed to with enough specificity to ensure the step one
inquiry is meaningful. Id. at 217 (“[W]e tread carefully in construing this
exclusionary principle lest it swallow all of patent law.”).
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.
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B. USPTO Revised Guidance
The PTO recently published revised guidance in the Federal Register
concerning the application of § 101. 2019 Revised Patent Subject Matter
Eligibility Guidance, 84 Fed. Reg. 50 (January 7, 2019) (hereinafter
“Revised Guidance”) (https://www.govinfo.gov/content/pkg/FR-2019-01-
07/pdf/2018-28282.pdf).
Under the Revised Guidance, 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);5 and
(2) additional elements that integrate the judicial
exception into a practical application (see Manual for Patent
Examining Procedure (“MPEP”) §§ 2106.05(a)–(c), (e)–(h)).6
See Revised Guidance 52–53.
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:
(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

5 Referred to as “Revised Step 2A, Prong 1” in the Revised Guidance
(hereinafter “Step 2A(i)”).
6 Referred to as “Revised Step 2A, Prong 2” in the Revised Guidance
(hereinafter “Step 2A(ii)”).
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(4) simply appends well-understood, routine,
conventional activities previously known to the industry,
specified at a high level of generality, to the judicial exception.7
See Revised Guidance 56.
Step 2A(i) – Abstract Idea
Informed by our judicial precedent, the Revised Guidance extracts and
synthesizes key concepts identified by the courts as abstract ideas to explain
that the abstract idea exception includes the following groupings of subject
matter, when recited as such in a claim limitation:
(a) Mathematical concepts—mathematical relationships,
mathematical formulas or equations, mathematical calculations;
(b) 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); and
(c) Mental processes—concepts performed in the human
mind (including an observation, evaluation, judgment, opinion).
Under the Revised Guidance, if the claim does not recite a judicial
exception (a law of nature, natural phenomenon, or subject matter within the
enumerated groupings of abstract ideas above), then the claim is patent-

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.
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eligible at Step 2A(i). This determination concludes the eligibility analysis,
except in situations identified in the Revised Guidance.8
However, if the claim recites a judicial exception (i.e., an abstract idea
enumerated above, a law of nature, or a natural phenomenon), the claim
requires further analysis for a practical application of the judicial exception
in Step 2A(ii).
Step 2A(ii) – Practical Application
If a claim recites a judicial exception in Step 2A(i), we determine
whether the recited judicial exception is integrated into a practical
application of that exception in Step 2A(ii) by: (a) identifying whether there
are any additional elements recited in the claim beyond the judicial
exception(s); and (b) evaluating those additional elements individually and
in combination to determine whether they integrate the exception into a
practical application.
The seven identified “practical application” sections of the MPEP,9
cited in the Revised Guidance under Step 2A(ii), are:

8 In the rare circumstance in which an examiner believes a claim limitation
that does not fall within the enumerated groupings of abstract ideas should
nonetheless be treated as reciting an abstract idea, the procedure described in
of the Guidance for analyzing the claim should be followed. See Revised
Guidance, Section III.C.
9 See MPEP §§ 2106.05(a)–(c), (e)–(h). Citations to the MPEP herein refer
to revision [R-08.2017]. Sections 2106.05(a), (b), (c), and (e) are indicative
of integration into a practical application, while §§ 2106.05(f), (g), and (h)
relate to limitations that are not indicative of integration into a practical
application.
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(1) MPEP § 2106.05(a) Improvements to the Functioning of
a Computer or To Any Other Technology or Technical
Field
(2) MPEP § 2106.05(b) Particular Machine
(3) MPEP § 2106.05(c) Particular Transformation
(4) MPEP § 2106.05(e) Other Meaningful Limitations
(5) MPEP § 2106.05(f) Mere Instructions To Apply An
Exception
(6) MPEP § 2106.05(g) Insignificant Extra-Solution Activity
(7) MPEP § 2106.05(h) Field of Use and Technological
Environment
See Revised Guidance 55.
If the recited judicial exception is integrated into a practical
application as determined under one or more of the MPEP sections cited
above, then the claim is not directed to the judicial exception, and the patent-
eligibility inquiry ends. See Revised Guidance 54. If not, then analysis
proceeds to Step 2B.
Step 2B – “Inventive Concept” or “Significantly More”
Under our reviewing courts’ precedent, it is possible that a claim that
does not “integrate” a recited judicial exception under Step 2A(ii) is
nonetheless patent eligible. For example, the claim may recite additional
elements that render the claim patent eligible even though a judicial
exception is recited in a separate claim element.10 The Federal Circuit has
held claims eligible at the second step of the Alice/Mayo test (USPTO Step
2B) because the additional elements recited in the claims provided
“significantly more” than the recited judicial exception (e.g., because the

10 See, e.g., Diehr, 450 U.S. at 187.
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additional elements were unconventional in combination).11 Therefore, if a
claim has been determined to be directed to a judicial exception under
Revised Step 2A, we must also evaluate the additional elements individually
and in combination under Step 2B to determine whether they provide an
inventive concept (i.e., whether the additional elements amount to
significantly more than the exception itself).12
Under the Revised Guidance, we must consider in Step 2B whether an
additional element or combination of elements: (1) “Adds a specific
limitation or combination of limitations that are not well-understood,
routine, conventional activity in the field, which is indicative that an
inventive concept may be present;” or (2) “simply appends well-understood,
routine, conventional activities previously known to the industry, specified
at a high level of generality, to the judicial exception, which is indicative
that an inventive concept may not be present.” See Revised Guidance,
III.B.13

11 See, e.g., Amdocs (Israel), Ltd. v. Openet Telecom, Inc., 841 F.3d 1288,
1300, 1304 (Fed. Cir. 2016); BASCOM Global Internet Services, Inc. v.
AT&T Mobility LLC, 827 F.3d 1341, 1349–52 (Fed. Cir. 2016); DDR
Holdings v. Hotels.com, L.P., 773 F.3d 1245, 1257–59 (Fed. Cir. 2014).
12 The patent eligibility inquiry may contain underlying issues of fact.
Mortg. Grader, Inc. v. First Choice Loan Servs. Inc., 811 F.3d 1314, 1325
(Fed. Cir. 2016). In particular, “[t]he question of whether a claim element or
combination of elements is well-understood, routine and conventional to a
skilled artisan in the relevant field is a question of fact.” Berkheimer v. HP
Inc., 881 F.3d 1360, 1368 (Fed. Cir. 2018).
13 In accordance with existing Step 2B guidance, an Examiner’s finding that
an additional element (or combination of elements) is well understood,
routine, conventional activity must be supported with at least one of the four
specific types of evidence required by the USPTO Berkheimer
Memorandum, as shown above. For more information concerning evaluation
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In the Step 2B analysis, an additional element (or combination of
elements) is not well-understood, routine or conventional unless the
examiner finds an evidentiary basis, and expressly supports a rejection in
writing with, one or more of the following:
1. A citation to an express statement in the
specification or to a statement made by an applicant during
prosecution that demonstrates the well-understood, routine,
conventional nature of the additional element(s). . . .
2. A citation to one or more of the court decisions
discussed in MPEP § 2106.05(d)(II) as noting the well-
understood, routine, conventional nature of the additional
element(s).
3. A citation to a publication that demonstrates the
well-understood, routine, conventional nature of the additional
element(s). . . .
4. A statement that the examiner is taking official
notice of the well-understood, routine, conventional nature of
the additional element(s). . . .
See Berkheimer Memo.
The analysis in Step 2B further determines whether an additional
element or combination of elements:
(a) Adds a specific limitation or combination of
limitations that are not well-understood, routine, conventional
activity in the field, which is indicative that an inventive
concept may be present; or

of well-understood, routine, conventional activity, see MPEP § 2106.05(d),
as modified by the USPTO Berkheimer Memorandum (USPTO
Commissioner for Patents Memorandum dated Apr. 19, 2018, “Changes in
Examination Procedure Pertaining to Subject Matter Eligibility, Recent
Subject Matter Eligibility Decision (Berkheimer v. HP, Inc.)” (hereinafter
“Berkheimer Memo”).
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(b) simply appends well-understood, routine,
conventional activities previously known to the industry,
specified at a high level of generality, to the judicial exception,
which is indicative that an inventive concept may not be
present.
Revised Guidance, and see Berkheimer Memo.
If the Examiner or the Board determines under Step 2B that the
element (or combination of elements) amounts to significantly more than the
exception itself, the claim is eligible, thereby concluding the eligibility
analysis.
However, if a determination is made that the element and combination
of elements does not amount to significantly more than the exception itself,
the claim is ineligible under Step 2B, and the claim should be rejected for
lack of subject matter eligibility.
ANALYSIS
Step 1 – Statutory Category
Claim 8, as a method (process) claim, recites one of the enumerated
categories of eligible subject matter in 35 U.S.C. § 101. Therefore, the issue
before us is whether it is directed to a judicial exception without
significantly more.
Step 2A(i): Does the Claim Recite a Judicial Exception?
The Examiner determined that claim 8 is directed to the “abstract idea
of a sales and marketing behavior[].” Final Act. 3.
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We conclude claim 8 does not recite the judicial exceptions of either
natural phenomena or laws of nature. We evaluate, de novo, whether
claim 8 recites an abstract idea based upon the Revised Guidance.
Claim 8 recites, in pertinent part, a method “for placing items in a
virtual universe,” that includes the steps of:
(1) “[A]scertaining a cost associated with displaying at
least one item at one or more locations . . . wherein the one or
more locations is a display area . . . for rent, sub-let,
assignment, or purchase by a user . . . wherein the cost
associated with displaying the at least one item at one or more
locations is calculated from a cost rating and a price charged by
a location owner, the cost rating being based on one or more
cost weightings related to economic trends and the price
charged by the location owner being based on a type of
purchase, lease, or rental agreement.”
(2) “[R]elaying information about the cost to the user,
thereby allowing the user to select at least one of the one or
more locations that fit a user’s budget.”
(3) “[P]roviding an additional scenario by increasing the
user’s budget, increasing a number of items of the at least one
item, and displaying the at least one item at a back location of
the one or more locations.”
(4) “[D]ynamically partitioning the one or more locations
into one or more additional locations.”
(5) “[R]ecognizing the one or more additional locations
and contacting the user about offering the one or more
additional locations for rent, sub-let, assignment, or purchase to
another user.”
(6) “[D]ynamically determining when the number of
items of the at least one item is below a predetermined level
such that an excess space of the one or more locations is
available to sub-let.”
Claims App’x.
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The Specification provides context as to what the claimed invention is
directed to. In this case, the Specification discloses that the invention is
directed to a “method to dynamically place products in a virtual universe
and, in particular, to dynamically place products in a virtual universe based
on an entity’s budget.” Spec. ¶ 1.
Appellants’ Abstract further describes the invention as:
A system and method . . . to dynamically place products
in a virtual universe and, in particular, to dynamically place
products in a virtual universe based on an entity’s budget. The
system includes a placement location analysis engine
configured to identify at least one location within a virtual
universe and a placement cost analysis engine configured to
determine a cost for displaying one or more items at one or
more of the at least one location. The system also includes a
recommendation engine configured to recommend one or more
of the at least one location based on a budget.
Spec. 34.
We determine that claim 8 recites a combination of mental processes
and certain methods of organizing human activity in the form of commercial
interactions including advertising which, aside from any claimed computer-
related aspects, may also be performed by a human using pen and paper.
This type of activity, i.e., placing products in advertisements at particular
locations based on an entity’s budget, and partitioning the particular location
into sub-locations that are available for product placement, as recited in each
of limitations (2), (3), (4), and (6), for example, includes longstanding
conduct that existed well before the advent of computers and the Internet,
and could be carried out by a human with pen and paper. See CyberSource
Corp. v. Retail Decisions, Inc., 654 F.3d 1366, 1375 (Fed. Cir. 2011) (“That
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purely mental processes can be unpatentable, even when performed by a
computer, was precisely the holding of the Supreme Court in Gottschalk v.
Benson.”).14
Under the broadest reasonable interpretation standard,15 we conclude
limitations (2), (3), (4), and (6), recite steps that would ordinarily occur
when “economic practices in which monetary transactions between people
are managed.” See Final Act. 4. For example, “relaying information about
the cost to the user, thereby allowing the user to select at least one of the one

14 Our reviewing court recognizes that “[a]n abstract idea can generally be
described at different levels of abstraction.” Apple, Inc. v. Ameranth, Inc.,
842 F.3d 1229, 1240 (Fed. Cir. 2016). That need not and, in this case does
not, “impact the patentability analysis.” Id. at 1241. Further, “[t]he Board’s
slight revision of its abstract idea analysis does not impact the patentability
analysis.” Id. Moreover, merely combining several abstract ideas does not
render the combination any less abstract. 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.”); see
also 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). For example, limitation (1), supra, could alternatively and
reasonably be construed as reciting a mathematical concept or calculation,
i.e., “wherein the cost associated with displaying the at least one item at one
or more locations is calculated from a cost rating and a price charged by a
location owner.”
15 During prosecution, claims must be given their broadest reasonable
interpretation when reading claim language in light of the specification as it
would be interpreted by one of ordinary skill in the art. In re Am. Acad. of
Sci. Tech. Ctr., 367 F.3d 1359, 1364 (Fed. Cir. 2004). Under this standard,
we interpret claim terms using “the broadest reasonable meaning of the
words in their ordinary usage as they would be understood by one of
ordinary skill in the art, taking into account whatever enlightenment by way
of definitions or otherwise that may be afforded by the written description
contained in the applicant’s specification.” In re Morris, 127 F.3d 1048,
1054 (Fed. Cir. 1997).
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or more locations that fit a user’s budget” (limitation 2) is an operation that
generally occurs when a location is available for rent, sub-let, assignment, or
purchase by a user. Further, partitioning the location into additional
locations available for rent, sub-let, assignment, or purchase by a user
(limitations 3, 4, and 6) are abstract steps, whether initiated person-to-
person, on paper, or using a computer.
Thus, under Step 2A(i), we agree with the Examiner that claim 8’s
method for placing items in a virtual universe is an abstract idea. We
conclude claim 8, under our Revised Guidance, at least recites the judicial
exceptions of mental process, i.e., a concept performed in the human mind
(including observations, evaluations, judgments, and rendering an opinion)
or, alternatively, certain methods of organizing human activity in the form of
commercial interactions, and thus is an abstract idea.
Step 2A(ii): Judicial Exception Integrated into a Practical Application?
If the claims are directed to a patent-ineligible concept, as we
conclude above, we proceed to the “practical application” Step 2A(ii) in
which we determine whether the recited judicial exception is integrated into
a practical application of that exception by: (a) identifying whether there are
any additional elements recited in the claim beyond the judicial exception(s);
and (b) evaluating those additional elements individually and in combination
to determine whether they integrate the exception into a practical
application.
We find each of limitations (2)–(4) and (6) of claim 8 recite abstract
ideas as identified in Step 2A(i), supra, and none of the limitations integrate
the abstract idea, i.e., a concept performed in the human mind (including an
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observation, evaluation, judgment, opinion), into a practical application as
determined under one or more of the MPEP sections cited above. The claim
as a whole merely uses instructions to implement the abstract idea on a
computer or, alternatively, merely uses a computer as a tool to perform the
abstract idea.
As to the specific limitations, we find limitation (1) recites
insignificant data gathering. See MPEP § 2106.05(g). Data gathering, as
performed by the steps or function in Appellants’ claims, is a classic
example of insignificant extra-solution activity. See, e.g., In re Bilski, 545
F.3d 943, 963 (Fed. Cir. 2008) (en banc), aff’d sub nom, Bilski v. Kappas,
561 U.S. 593 (2010).
We also find limitation (5) recites insignificant post solution
activity.16 The Supreme Court guides that the “prohibition against patenting
abstract ideas ‘cannot be circumvented’ [by] adding ‘insignificant
postsolution activity.’” Bilski, 561 U.S. at 610–11 (quoting Diehr, 450 U.S.
at 191–92). On this record, we are of the view that Appellants’ claims do
not operate the recited generic computer components in an unconventional
manner to achieve an improvement in computer functionality. See MPEP
§ 2106.05(a).
With respect to this step of the analysis, Appellants argue:
Moreover, Appellant respectfully submits that the features
recited in claim 8 are technological features which improve on the
existing processes within a virtual universe . . . the existing processes
within the virtual universe make it difficult to find locations to place

16 We also note the “recognizing” steps can be carried out by a human in the
mind, communicated orally, or by use of pen and paper. See CyberSource,
654 F.3d at 1375.
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products to optimally reach customers within a virtual universe.
However, the existing processes within the virtual universe do not
dynamically place products in a virtual universe based on an entity’s
budget. Therefore, claim 8 recites technological features which are not
directed to an abstract idea.
App. Br. 18.
The Examiner concludes, “the claims have disclosed an improvement
in the business and budgeting process but have not sufficiently disclosed an
improvement in the technology, as the only improvement that can be found
in the specification . . . [is] maximizing a vendor’s budget.” Ans. 6 (citing
Spec. ¶ 32).
In reply to the Examiner’s conclusion, Appellants contend:
[C]laim [8] recites technological features, which are
improvements to existing processes of a virtual universe, which
make it difficult to find locations to place products to optimally
reach customers within a virtual universe . . . . In other words,
the claimed invention makes it easier to find locations to place
products with a virtual universe.
Reply Br. 10.17
In response to Appellants’ apparent novelty argument, we note the
Supreme Court emphasizes, “[t]he ‘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.” Diehr, 450 U.S. at 188–89 (emphasis
added). Our reviewing court further guides that “[e]ligibility and novelty are

17 We note that while Appellants direct their arguments to claim 1 in the
Reply Brief, the same claim limitations at issue with claim 1 (“dynamically
partitioning” and “dynamically determining”) can also be found in claims 8,
16, and 22.
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separate inquiries.” Two-Way Media Ltd. v. Comcast Cable Commc’ns,
LLC, 874 F.3d 1329, 1340 (Fed. Cir. 2017); see also Affinity Labs of Tex.,
LLC v. DIRECTV, LLC, 838 F.3d 1253, 1263 (Fed. Cir. 2016) (holding that
“[e]ven assuming” that a particular claimed feature was novel does not
“avoid the problem of abstractness”).
Thus, we determine that, even if “the existing processes within the
virtual universe do not dynamically place products in a virtual universe
based on an entity’s budget” (as argued by Appellants), in accord with
Supreme Court precedent, the novelty of Appellant’s claimed invention has
no relevance to its patent eligibility. Further, we conclude, even if “the
claimed invention makes it easier to find locations to place products with a
virtual universe” (as argued by Appellants, above), this is not an
improvement under the guidance of Manual of Patent Examining Procedure
section 2106.05(a) (“Improvements to the Functioning of a Computer or to
Any Other Technology or Technical Field”) or section 2106.05(e)(“Other
Meaningful Limitations”).
Therefore, we conclude the claim as a whole merely uses instructions
to implement the abstract idea on a computer or, alternatively, merely uses a
computer as a tool to perform the abstract idea. Thus, on this record,
Appellants have not shown an improvement or practical application under
the guidance of Manual of Patent Examining Procedure section 2106.05(a)
(“Improvements to the Functioning of a Computer or to Any Other
Technology or Technical Field”) or section 2106.05(e)(“Other Meaningful
Limitations”). Nor do Appellants advance any arguments in the Brief(s) that
are directed to the Bilski machine-or-transformation test, which would only
be applicable to the method (process) claims on appeal. See MPEP
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§§ 2106.05(b) (Particular Machine) and 2106.05(c) (Particular
Transformation).
Therefore, under Step 2A(ii), we conclude the abstract idea is not
integrated into a practical application, and thus the claim 8 is directed to the
judicial exception.
Step 2B – “Inventive Concept” or “Significantly More”
If the claims are directed to a patent-ineligible concept, as we
conclude above, we proceed to the “inventive concept” step. For Step 2B we
must “look with more specificity at what the claim elements add, in order to
determine ‘whether they identify an “inventive concept” in the application of
the ineligible subject matter’ to which the claim is directed.” Affinity Labs
of Texas, LLC v. DIRECTV, LLC, 838 F.3d 1253, 1258 (Fed. Cir. 2016)
(quoting Elec. Power Grp., 830 F.3d at 1353).
In applying step two of the Alice analysis, our reviewing court guides
we must “determine whether the claims do significantly more than simply
describe [the] abstract method” and thus transform the abstract idea into
patentable subject matter. Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709,
715 (Fed. Cir. 2014). We look to see whether there are any “additional
features” in the claims that constitute an “inventive concept,” thereby
rendering the claims eligible for patenting even if they are directed to an
abstract idea. Alice, 573 U.S. at 221. Those “additional features” must be
more than “well-understood, routine, conventional activity.” Mayo, 566
U.S. at 79.
Limitations referenced in Alice that are not enough to qualify as
“significantly more” when recited in a claim with an abstract idea include, as
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non-limiting or non-exclusive examples: adding the words “apply it” (or an
equivalent) with an abstract idea18; mere instructions to implement an
abstract idea on a computer19; or requiring no more than a generic computer
to perform generic computer functions that are well-understood, routine and
conventional activities previously known to the industry.20
Evaluating representative claim 8 under Step 2B of the Alice analysis,
we conclude it lacks an inventive concept that transforms the abstract idea of
mental processes, i.e., a concept performed in the human mind (including an
observation, evaluation, judgment, opinion), and/or a commercial interaction
in the form of sales or advertising, into a patent-eligible application of that
abstract idea.
The patent eligibility inquiry may contain underlying issues of fact.
Mortg. Grader, 811 F.3d at 1325. In particular, “[t]he question of whether a
claim element or combination of elements is well-understood, routine and
conventional to a skilled artisan in the relevant field is a question of fact.”
Berkheimer, 881 F.3d at 1368.
As evidence of the conventional nature of the recited “placement
location analysis engine,” “placement cost analysis engine,”
“recommendation engine,” “sensitivity analysis engine,” and “virtual
universe,” in system claim 1; “virtual universe” and “processor” in method

18 Alice, 573 U.S. at 221–23.
19 Alice, 573 U.S. at 221, e.g., simply implementing a mathematical
principle on a physical machine, namely a computer (citing Mayo, 566 U.S.
at 84–85).
20 Alice, 573 U.S. at 225, e.g., using a computer to obtain data, adjust
account balances, and issue automated instructions.
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claims 8 and 22, and computer program product claim 16, the Specification
discloses, “[a] virtual universe (VU) is an interactive simulated environment
accessed by multiple users through an online interface.” Spec. ¶ 2. As
further evidence of the WURC nature of the claimed elements:
[0034] In general, the processor 20 executes computer
program code, which is stored in the memory 22A and/or
storage system 228. While executing computer program code,
the processor 20 can read and/or write data to/from memory
22A, storage system 228, and/or I/O interface 24. The program
code can execute the processes described herein. The bus 26
provides a communications link between each of the
components in the computing device 14.
Spec. ¶ 34. Further,
[0036] The computing device 14 can comprise any general
purpose computing article of manufacture capable of executing
computer program code installed thereon (e.g., a personal
computer, server, handheld device, etc.). However, it is
understood that the computing device 14 is only representative
of various possible equivalent computing devices that may
perform the processes described herein. To this extent, in
embodiments, the functionality provided by the computing
device 14 can be implemented by a computing article of
manufacture that includes any combination of general and/or
specific purpose hardware and/or computer program code. In
each embodiment, the program code and hardware can be
created using standard programming and engineering
techniques, respectively.
Spec. ¶ 36.
Thus, because the Specification describes the additional elements in
general terms, without describing the particulars, we conclude the claim
limitations may be broadly but reasonably construed as reciting conventional
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computer components and techniques, particularly in light of Appellants’
Specification, as quoted above.21
With respect to this step of the analysis, Appellants contend:
In addition, Appellant respectfully submits that an
inventive concept can be found in the non-conventional and
non-generic arrangement of known, conventional pieces. See
Bascom Global Internet Services, Inc. v. AT&T Mobility, 2015-
1763 (Fed. Cir. June 27, 2016). Appellant respectfully submits
that dynamically partitioning the one or more locations into one
or more additional locations in the virtual universe and
dynamically determining when the number of items of the at
least one item is below a predetermined level such that an
excess space of the one or more locations is available to sub-let,
as recited in the claimed invention, is a nonconventional and
non-generic arrangement of elements. This is because the
claimed features dynamically determine when a number of
items is below a predetermined level in a virtual universe and
dynamically partition a location into additional locations, which
is different from existing processes in which new and
experienced users within a virtual universe have problems
finding locations to place their products to optimally reach
customers.
App. Br. 14–15.
We note that the Manual of Patent Examining Procedure, based upon
our precedential case law, provides additional considerations with respect to
analysis of the well-understood, routine, and conventional nature of the
claimed computer-related components.

21 Claim terms are to be given their broadest reasonable interpretation, as
understood by those of ordinary skill in the art and taking into account
whatever enlightenment may be had from the Specification. In re Morris,
127 F.3d 1048, 1054 (Fed. Cir. 1997).
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Another consideration when determining whether a claim
recites significantly more than a judicial exception is whether
the additional elements amount to more than a recitation of the
words “apply it” (or an equivalent) or are more than mere
instructions to implement an abstract idea or other exception on
a computer. As explained by the Supreme Court, in order to
transform a judicial exception into a patent-eligible application,
the additional element or combination of elements must do
“‘more than simply stat[e] the [judicial exception] while adding
the words ‘apply it’”. Alice Corp. v. CLS Bank, 573 U.S. __,
134 S. Ct. 2347, 2357, 110 USPQ2d 1976, 1982-83 (2014)
(quoting Mayo Collaborative Servs. v. Prometheus Labs., Inc.,
566 U.S. 66, 72, 101 USPQ2d 1961, 1965). Thus, for example,
claims that amount to nothing more than an instruction to apply
the abstract idea using a generic computer do not render an
abstract idea eligible. Alice Corp., 134 S. Ct. at 2358, 110
USPQ2d at 1983. See also 134 S. Ct. at 2389, 110 USPQ2d at
1984 (warning against a § 101 analysis that turns on “the
draftsman’s art”) . . . .
In Alice Corp., the claim recited the concept of
intermediated settlement as performed by a generic computer.
The Court found that the recitation of the computer in the claim
amounted to mere instructions to apply the abstract idea on a
generic computer. 134 S. Ct. at 2359-60, 110 USPQ2d at 1984.
The Supreme Court also discussed this concept in an earlier
case, Gottschalk v. Benson, 409 U.S. 63, 70, 175 USPQ 673,
676 (1972), where the claim recited a process for converting
binary-coded decimal (BCD) numerals into pure binary
numbers. The Court found that the claimed process had no
substantial practical application except in connection with a
computer. Benson, 409 U.S. at 71-72, 175 USPQ at 676. The
claim simply stated a judicial exception (e.g., law of nature or
abstract idea) while effectively adding words that “apply it” in a
computer. Id.
MPEP § 2106.05(f) (“Mere Instructions To Apply An Exception”).
Further, in Bascom, the claims were directed to the inventive concept
of providing customizable Internet-content filtering which, under Step 2B of
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the Alice analysis, was found to transform the abstract idea of filtering
content into a patent-eligible invention. Although the underlying idea of
filtering Internet content was deemed to be abstract, under Step 2B of the
Alice analysis, the claims carved out a specific location for the filtering
system, namely a remote Internet service provider (ISP) server, and required
the filtering system to give users the ability to customize filtering for their
individual network accounts. Bascom Global Internet Services, Inc. v.
AT&T Mobility LLC, 827 F.3d 1341, 1349 (Fed. Cir. 2016).
In response to Appellants’ reliance upon Bascom, supra, we find no
evidence of record to substantiate the assertion that the claims recite non-
conventional and non-generic arrangement of known, conventional
elements, as in Bascom. Moreover, we find no analogy between Appellants’
claimed method for placing items in a virtual universe and the Internet
content filtering claims in Bascom.
With respect to the Step 2B analysis, we conclude, similar to Alice, the
recitation of a method “for placing items in a virtual universe that includes
“a virtual universe” and “a processor” (claim 8) as argued by Appellants,
and similarly for system claim 1 that includes “a placement location analysis
engine,” “a placement cost analysis engine,” “a recommendation engine,” “a
sensitivity analysis engine,” and “a virtual universe” (and similarly for
computer program product claim 16 and method claim 22) is simply not
enough to transform the patent-ineligible abstract idea here into a patent-
eligible invention under Step 2B. See Alice, 573 U.S. at 221 (“[C]laims,
which merely require generic computer implementation, fail to transform
[an] abstract idea into a patent-eligible invention.”).
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We conclude the claims fail the Step 2B analysis because claim 8, in
essence, merely recites various computer-based elements along with no
more than mere instructions to implement the identified abstract idea using
the computer-based elements.
Rejection of Dependent Claims 2, 15, 19, 21, 26, 27, 29, 30, and 32
Further, while Appellants raised additional arguments for patentability
of dependent claims 2, 15, 19, 21, 26, 27, 29, 30, and 32, we find that
Appellants have merely summarized the claim language of each claim,
argued that it improves existing technology or technological field, and
concluded that each claim recites patent eligible subject matter. App.
Br. 39–43.
We further determine that consideration of each claim individually
does not require a separate written analysis for each individual claim. We
decline to find error here in the Examiner’s decision to not address the
patent-eligibility of each of claims 2, 15, 19, 21, 26, 27, 29, 30, and 32
individually, where, as the Examiner observes (Final Act. 3), the claims are
all directed to the same abstract idea under the Examiner’s analysis, i.e.,
sales and marketing activities. See Content Extraction & Transmission LLC
v. Wells Fargo Bank, Nat. Ass’n, 776 F.3d 1343, 1348 (Fed. Cir. 2014)
(explaining that when all claims are directed to the same abstract idea,
“addressing each claim of the asserted patents [is] unnecessary”).
Therefore, in light of the foregoing, we conclude, under the Revised
Guidance, that Appellants’ claim 8, 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, we
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sustain the Examiner’s § 101 rejection of independent claim 8, and grouped
claims 1, 2, 12–17, 19–22, 24–30, and 32, not argued substantively, and
which fall therewith. See Claim Grouping, supra.
REPLY BRIEF
To the extent Appellants may advance new arguments in the Reply
Brief (Reply Br. 2–12) not in response to a shift in the Examiner’s position
in the Answer, arguments raised in a Reply Brief that were not raised in the
Appeal Brief or are not responsive to arguments raised in the Examiner’s
Answer will not be considered except for good cause (see 37 C.F.R.
§ 41.41(b)(2)), which Appellants have not shown.
CONCLUSION
Under our Revised Guidance, governed by relevant case law, claims
1, 2, 8, 12–17, 19–22, 24–30, and 32 in the rejection under 35 U.S.C. § 101
are directed to patent-ineligible subject matter, and we sustain the rejection.
DECISION
We affirm the Examiner’s decision rejecting claims 1, 2, 8, 12–17,
19–22, 24–30, and 32.
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