Ex Parte Amaitis et al

Patent Trial and Appeal Board

Dec 31, 2018

13762795 (P.T.A.B. Dec. 31, 2018)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE
13/762,795 02/08/2013
63710 7590 01/03/2019
INNOVATION DIVISION
CANTOR FITZGERALD, L.P.
110 EAST 59TH STREET (6TH FLOOR)
NEW YORK, NY 10022
FIRST NAMED INVENTOR
LeeAmaitis
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
ATTORNEY DOCKET NO. CONFIRMATION NO.
13-2380 8661
EXAMINER
CARTER, KEVIN M
ART UNIT PAPER NUMBER
3716
NOTIFICATION DATE DELIVERY MODE
01/03/2019 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):
patentdocketing@cantor.com
lkorovich@cantor.com
phowe@cantor.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte LEE AMAITIS and KENNETH L. MILLER
Appeal2018-004800
Application 13/762,795 1
Technology Center 3700
Before STEFAN STAICOVICI, LEE L. STEPINA, and
ARTHUR M. PESLAK, Administrative Patent Judges.
STAICOVICI, Administrative Patent Judge.
DECISION ON APPEAL
STATEMENT OF THE CASE
Lee Amaitis and Kenneth L. Miller ("Appellants") appeal under
35 U.S.C. § 134(a) from the Examiner's decision in the Final Office Action
(dated June 15, 2017, hereinafter "Final Act.") rejecting claims 1, 3-10, and
12-18. 2 We have jurisdiction under 35 U.S.C. § 6(b ).
SUMMARY OF DECISION
We AFFIRM.
1 CFPH, LLC is the applicant and is identified as the real party in interest in
Appellants' Appeal Brief (filed Oct. 20, 2017, hereinafter "Appeal Br.").
Appeal Br. 3.
2 Claims 2 and 11 are cancelled. See Appeal Br. 16-17 (Claims App'x.).
Appeal2018-004800
Application 13/7 62,795
INVENTION
Appellants' invention relates to an apparatus and method for
accepting wagers in a combined book and pari-mutuel environment. Spec.
1, 11. 18-26. Claims 1, 15, and 17 are independent. Claim 1, reproduced
below, is illustrative of the claimed subject matter:
1. An apparatus comprising:
a memory;
a network interface to communicate with remote devices
over an electronic network;
at least one processor to:
receive, via the network interface, data indicative of a
request for a first wager on an event from a first remote device;
generate, in the memory, data indicative of the first wager
between the remote device and a gaming operator;
in response to receiving the request, identify a proportion
of the first wager to place with a pari-mutuel pool of wagers;
generate, in the memory, data indicative of a second wager
between the gaming operator and the pari-mutuel pool of wagers,
the second wager comprising the proportion of the first wager;
receive, via the network interface, data indicative of an
outcome of the event;
resolve the first wager based on the outcome of the event;
and
resolve the second wager with the pool based on the
outcome of the event.
REJECTIONS
I. Claims 1, 3-10, and 12-18 are rejected under 35 U.S.C.
§ 101 as being directed to non-statutory subject matter.
II. Claims 1, 6, 9, 13-15, 17, and 18 are rejected under
35 U.S.C. § 103(a) as being unpatentable over Amour
(US 2007 /0287533 Al, pub. Dec. 13, 2007, hereinafter
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"Amour '533") and Aronson et al. (US 2002/0065566
Al, pub. May 30, 2002, hereinafter "Aronson").
III. Claims 3 and 4 are rejected under 35 U.S.C. § I03(a) as
being unpatentable over Amour '533, Aronson, and
Amour (US 7,537,521 B2, iss. May 26, 2009, hereinafter
"Amour '521").
IV. Claims 5, 7, 8, 10, and 16 are rejected under 35 U.S.C.
§ I03(a) as being unpatentable over Amour '533,
Aronson, and Mindes et al. (US 2007/0293310 Al, pub.
Dec. 20, 2007, hereinafter "Mindes").
V. Claim 12 is rejected under 35 U.S.C. § I03(a) as being
unpatentable over Amour '533, Aronson, and Flaherty et
al. (US 2013/0178270 Al, pub. July 11, 2013, hereinafter
"Flaherty").
ANALYSIS
Rejection I
Appellants have not presented arguments for the patentability of
claims 3-10 and 12-18 apart from claim 1. See Appeal Br. 8-10. 3
Therefore, in accordance with 37 C.F.R. § 4I.37(c)(l)(iv), we select claim 1
as the representative claim to decide the appeal, with claims 3-10 and 12-18
standing or falling with claim 1.
3 Appellants' Reply Brief ( dated Apr. 4, 2018, hereinafter "Reply Br.") relies
on the arguments discussed in the Appeal Brief with no additional
arguments. See Reply Br. 2.
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Section 101 of the Patent Act defines patent-eligible subject matter:
"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 to the conditions and
requirements of this title." 35 U.S.C. § 101. In interpreting this statutory
provision, the Supreme Court has held that its broad language is subject to
an implicit exception for "laws of nature, natural phenomena, and abstract
ideas," which are not patentable. Alice Corp. Pty. Ltd. v. CLS Bank Int 'l,
134 S. Ct. 2347, 2355 (2014).
The Supreme Court has set forth "a framework for distinguishing
patents that claim laws of nature, natural phenomena, and abstract ideas
from those that claim patent-eligible applications of those concepts." Alice,
134 S. Ct. at 2355 (citing Mayo Collaborative Servs. v. Prometheus Labs.,
Inc., 566 U.S. 66 (2012)). According to the Supreme Court's framework,
we must first determine whether the claims at issue are directed to one of
those concepts (i.e., laws of nature, natural phenomena, and abstract ideas).
Id. If so, we must secondly "consider the elements of each claim both
individually and 'as an ordered combination' to determine whether the
additional elements 'transform the nature of the claim' into a patent-eligible
application." Id. (quoting Mayo, 566 U.S. at 79, 78). The Supreme Court
characterizes the second step of the analysis as "a search for an 'inventive
concept' - i.e., an element or combination of elements that is 'sufficient to
ensure that the patent in practice amounts to significantly more than a patent
upon the [ ineligible concept] itself."' Id. ( alteration in original) ( quoting
Mayo, 566 U.S. at 72-73).
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Step One
The Examiner determines that the claimed invention is "directed to
the abstract idea of wagering." Final Act. 2. The Examiner states that
wagering is "rooted in the same fundamental economic principles as hedging
a financial investment and forming a contractual relationship" that have been
identified as abstract ideas in cases such as Bilski v. Kappas, 561 U.S. 593
(2010) and buySAFE, Inc. v. Google, Inc., 765 F.3d 1350 (Fed. Cir. 2014).
Final Act. 2--4. According to the Examiner, the claimed limitations do not
amount to significantly more than the abstract idea because they are well-
understood, routine, conventional activities that "do not provide meaningful
limitations to transform the abstract idea into a patent eligible application of
the abstract idea such that the claim(s) amounts to significantly more than
the abstract idea itself." Id. at 3 (citing Alice Corp. v. CLS Bank Int'!, 134 S.
Ct. 2347 (2014)).
The first prong of the test requires us to determine whether the
challenged claims are directed to an abstract idea. To that end, Appellants
argue that the claims are patent eligible because the Examiner's citation to
Bilski is not "an appropriate court decision ... reasonably tied to the
facts of the [present] case." Appeal Br. 9. Appellants contend that
whereas the claimed subject matter is directed to wagering, "the
representative claim in Bilski was drawn to transactions between a
commodity provider and commodity consumers. Therefore, the facts of
Bilski are not reasonably tied to the facts of the instant case." Id.
Appellants assert that moreover, the claims are patent-eligible consistent
with the USPTO eligibility guidelines of Nov. 2, 2016, because the "claims
recite a 'set of rules ... that improve computer-related technology by
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allowing computer performance of a function not previously
performable by a computer."' Appeal Br. 10.
Appellants' arguments are not persuasive because we agree with the
Examiner that the claimed wagering method4 is reasonably tied to risk
mitigation, as in Bilski, because placing a larger portion of riskier bets in the
pari-mutuel pool reduces, that is, mitigates, risk. See Examiner's Answer 3-
4 (dated Feb. 8, 2018, hereinafter "Ans."). For example, Appellants'
Specification describes that "[a] more risky . . . wager may go entirely into
the pool and/or have a greater portion put into the pool." Spec. 7, 11. 9-18;
cf Bilski 561 U.S. at 611 ("the basic concept of hedging, or protecting
against risk ... is an unpatentable abstract idea."); see also In re Smith, 815
F.3d 816,817 (Fed. Cir. 2016) ("On the first step, we conclude that
Applicants' claims, directed to rules for conducting a wagering game,
compare to other 'fundamental economic practices' found abstract by the
Supreme Court.").
In conclusion, when read as a whole, independent claim 1 is directed
to mitigating risk in wagering, and, for the reasons discussed above,
constitutes an abstract idea under the first step set forth in Alice. Alice, 134
S. Ct. at 2355. The question to be settled next is whether claim 1 recites an
4 Although we appreciate that independent claims 1 and 15 are drawn to an
apparatus, nonetheless, "the basic character of a process claim drawn to an
abstract idea is not changed by claiming only its performance by computers,
or by claiming the process embodied in program instructions on a computer
readable medium." See CyberSource, 654 F.3d at 1375-76 (citing In re
Abele, 684 F.2d 902 (CCPA 1982)). The introduction of a generic element,
such as a processor, into an apparatus claim, such as claims 1 and 15, has
been deemed insufficient by the Supreme Court to transform a patent-
ineligible claim into one that is patent-eligible. See Alice, 134 S. Ct. at 2358.
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element, or combination of elements, that is enough to ensure that the claim
is directed to significantly more than an abstract idea.
Step Two
As to the second part of the Alice eligibility analysis, Appellants'
arguments that the claimed invention is an improvement in computer
functionality (see Appeal Br. 12) are also unpersuasive because the Court in
Alice made clear that a claim directed to an abstract idea does not move into
section 101 eligibility territory by "merely requir[ing] generic computer
implementation." Alice, 134 S. Ct. at 2357. Whereas the claims at issue
might improve wagering (i.e., the abstract idea), Appellants do not provide
evidence or persuasive arguments that the generic computer has improved
functionality. The test is not whether the claimed "processor" can perform a
"new" function, i.e., mitigate risk in wagering. It is whether performing the
function allows the claimed "processor" to function better. Here, we agree
with the Examiner that the claimed "processor" functions in a conventional
manner to receive and resolve a wager. See Ans. 5---6; see also Spec. 23, 11.
28-24, 1. 13.
For the above reasons, the recited elements, considered individually
and as an ordered combination, do not constitute an "inventive concept" that
transforms independent claim 1 into patent-eligible subject matter. See
Alice, 134 S. Ct. at 2355. Accordingly, we sustain the rejection of claim 1
under 35 U.S.C. § 101 as directed to patent-ineligible subject matter. Claims
3-10 and 12-18 fall with claim 1.
Rejection II
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Appellants have not presented arguments for the patentability of
claims 6, 9, 13-15, 17, and 18 apart from claim 1. See Appeal Br. 13-14.
Therefore, we select claim 1 as the representative claim to decide the appeal
of the rejection of these claims, with claims 6, 9, 13-15, 17, and 18 standing
or falling with claim 1.
In rejecting independent claim 1, the Examiner finds that Amour '533
discloses most of the recited features including, inter alia, generating data
indicative of a first wager, and a second wager that is a portion of the first
wager, but relies on Aronson to disclose "a wager between a racetrack (game
operator) and a totalizator (pari-mutuel pool of wagers)." Final Act. 7
( citing Aronson, para. 4 7). The Examiner concludes that it would have been
obvious to a person of ordinary skill in the art at the time the invention was
made to modify Amour '533 to generate data indicative of "a wager between
the gaming operator and a pari-mutuel pool of wagers, as taught by Aronson,
in order to reduce the risk of a book by generating less risky pari-mutuel
wagers to hedge the more risky fixed wagers." Id. (citing Aronson, paras. 3,
4).
Appellants argue that Amour '533 does not allocate a proportion of a
first wager into a pari-mutuel pool of wagers, as called for by claim 1,
because Amour discloses that non-winning players are allocated entries to a
supplementary gaming activity based on the player's supplementary
contribution amount. Appeal Br. 11. According to Appellants, allocating
entries as in Amour '533 is "based on a contribution amount (i.e., the more
contributed the more allocated entries)." Id.
We are not persuaded by Appellants' arguments for the following
reasons. We agree with the Examiner that because Amour '533 discloses an
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entry fee (first wager) that is a "total contribution amount," the entry fee
includes a primary contribution amount and a supplementary contribution
amount (second wager). Final Act. 7; see also Amour '533, paras. 52-55.
The Examiner is correct that the entry fee in Amour '533 constitutes a first
wager and that the supplementary contribution in Amour '533 is a
proportion of the first wager. See Ans. 7. Hence, because Amour '533
"discloses, 'allocating to each player identified at step 1002 one or more
supplementary entries in a supplementary gaming activity, which, in the
present example, is a pari-mutuel gaming activity,"' we agree with the
Examiner that Amour '533 identifies a proportion of the first wager, that is,
the supplementary contribution amount, to place with a pari-mutuel pool of
wagers. Id. As such, the portion that is used for the second wager is used in
"pari-mutuel gaming activity." See Amour '553, para. 272. Moreover, to
the extent that Appellants are arguing that "pari-mutuel gaming activity" is
not a wager, we note that Amour '533 defines "pari-mutuel" as synonymous
with "mutual betting" (wagering). Id., para. 168.
Appellants also argue that Amour '533 "does not disclose 'a second
wager between the gaming operator and the pari-mutuel pool of
wagers', the second wager comprising the proportion of the first
wager," because the pari-mutuel gaming activity in Amour '533 is "not a
wager between the gaming operator and the pari-mutuel pool of
wagers." Appeal Br. 11-12. According to Appellants, "Aronson does not
cure the deficiencies in Amour ['533]." Id. at 12.
Appellants' arguments are not persuasive because the Examiner relies
on Aronson, not Amour '533 to disclose a wager between a gaming operator
and a pari-mutuel pool of wagers. See Ans. 7. Specifically, Aronson
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discloses that "[ t ]otalisators 30 are the computer systems that may be used to
handle pari-mutuel wagers made at the racetracks, made at off-track betting
establishments, and made using interactive wagering system 10. Totalisators
30 may place wagers into applicable pari-mutuel wagering pools." Aronson,
para. 4 7; see also Ans. 7. As such, given that Aronson discloses using
computer systems to handle pari-mutuel wagers made at the racetracks,
Appellants do not persuade us that the Examiner's finding of "Aronson
teach[ing] a wager between a racetrack (game operator) and a totalizator
(pari-mutuel pool of wagers)" is in error. Final Act. 6-7.
In conclusion, for the foregoing reasons, we sustain the rejection of
claim 1 under 35 U.S.C. § 103(a) as unpatentable over Amour '533 and
Aronson. Claims 6, 9, 13-15, 17, and 18 fall with claim 1.
Rejections 111-V
Appellants' arguments rely on the arguments discussed supra, in the
rejection of claim 1, from which claims 3-5, 7, 8, 10, and 12 depend. See
Appeal Br. 14. Claim 16 depends from independent claim 15, which falls
with claim 1. Id.
Therefore, for the same reasons as discussed above, we also sustain
the rejections under 35 U.S.C. § 103(a) of claims 3 and 4 as unpatentable
over Amour '533, Aronson, and Amour '521; of claims 5, 7, 8, 10, and 16 as
unpatentable over Amour '533, Aronson, and Mindes; and of claim 12 as
unpatentable over Amour '533, Aronson, and Flaherty.
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DECISION
The Examiner's decision to reject claims 1, 3-10, and 12-18 under
35 U.S.C. § 101 as directed to non-statutory subject matter is affirmed.
The Examiner's decision to reject claims 1, 3-10, and 12-18 under
35 U.S.C. § 103(a) is affirmed.
No time period for taking any subsequent action in connection with
this appeal may be extended under 37 C.F.R. § 1.136(a)(l )(iv).
AFFIRMED
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