Ex Parte Bortolin et al

Patent Trials and Appeals Board

Aug 4, 2014

10365703 - (D) (P.T.A.B. Aug. 4, 2014)

UNITED STATES PATENT AND TRADEMARK OFFICE
____________________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________________

Ex parte CORINNE BORTOLIN, AYMAN HAMMAD,
CHRIS S. NELSON, and JOHN OTAEGUI
____________________

Appeal 2012-000797
Application 10/365,7031
Technology Center 3600
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Before ANTON W. FETTING, MICHAEL W. KIM, and
NINA L. MEDLOCK, Administrative Patent Judges.

MEDLOCK, Administrative Patent Judge.

DECISION ON APPEAL

STATEMENT OF THE CASE
Appellants appeal under 35 U.S.C. § 134(a) from the Examiner’s final
rejection of claims 16–21, 23, 29–37, 42–44, 46–48, 53–55, 57–59, 63, and
69–72. We have jurisdiction under 35 U.S.C. § 6(b).
We AFFIRM.2

1 The real party in interest identified by Appellants is Visa U.S.A., Inc.
App. Br. 3.
2 Our decision will refer to Appellants’ Appeal Brief (“App. Br.,” filed
March 8, 2011) and Reply Brief (“Reply Br.,” filed August 10, 2011), and
the Examiner’s Answer (“Ans.,” mailed June 13, 2011).
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THE CLAIMED INVENTION
Appellants’ claimed invention “relates to a method and system for
selectively applying discounts to commercial transactions based on relevant
tax laws” (Spec. ¶ 2).
Claim 42, reproduced below, is illustrative of the subject matter on
appeal:
42. A method for calculating transaction amounts for
transactions, comprising:
inserting a smartcard into a point-of-sale device, wherein
the point of sale device operates in an offline manner;
providing reward information including a reward
selection and a total transaction amount for a transaction to the
point-of-sale device;
directing the point-of-sale device to reverse calculate a
tax amount and a pre-tax subtotal amount using the total
transaction amount and a tax rate stored on the point-of-sale
device;
directing the point-of-sale device to calculate a discount
amount for the transaction based on the reward information and
the pre-tax subtotal amount;
directing the point-of-sale device to calculate a revised
tax amount based on the discount amount, wherein the revised
tax amount is calculated on either a post-tax basis and a pre-tax
basis, and wherein which basis is used to calculate the revised
tax amount depends on where the transaction is incurred; and
directing the point of sale device to perform
authentication and an online authorization request.

THE REJECTION
The following rejection is before us for review:
Claims 16–21, 23, 29–37, 42–44, 46–48, 53–55, 57–59, 63, and 69–72
are rejected under 35 U.S.C. § 103(a) as unpatentable over Walker
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(US 7,240,021 B1, iss. July 3, 2007), Appellants’ Background of the
Invention (hereinafter “ABI”), Tadakuma (US 4,144,567, iss. Mar. 13,
1979), Fernandez (US 2001/0016827 A1, pub. Aug. 23, 2001), and Herz
(US 2001/0014868 A1, pub. Aug. 16, 2001).

ANALYSIS
Claims 16–21, 23, 29–37, 42–44, 46–48, 53–55, 57–59, 63, and 69–71
Appellants argue claims 16–21, 23, 29–37, 42–44, 46–48, 53–55, 57–
59, 63, and 69–71 as a group, and select claim 42 as representative (App.
Br. 7–8). The remaining claims, thus, stand or fall with claim 42.
37 C.F.R. § 41.37(c)(1)(vii) (2008).3
We are not persuaded by Appellants’ argument that the Examiner
erred in rejecting claim 42 under 35 U.S.C. § 103(a) because none of the
cited references discloses or suggests “directing the point-of-sale device
[“POS”] to reverse calculate a tax amount and a pre-tax subtotal amount
using the total transaction amount and a tax rate stored on the [POS]
device,” as recited in claim 42 (App. Br. 8–11; see also Reply Br. 2–4).
Instead, we agree with the Examiner that the argued feature would have been

3 Notwithstanding Appellants’ indication that “[c]laims 16–21, 23, 29–37,
43[,] 44, 46–48, 53–55, 57–59, 63, and 69–71 may stand or fall with respect
to independent claim 42” (App. Br. 7–8), Appellants argue separately, with
respect to claim 16, that “Fernandez teaches away from a system using
smartcards,” as recited in the claim (App. Br. 15). In this regard, Appellants
argue that paragraph 16 of Fernandez discloses that it would be impractical
to use a smartcard “for a onetime, limited duration promotion” (id.).
However, as the Examiner observes, Fernandez expressly discloses that
“[the present] invention can be used with [a] smart card” (Ans. 19, citing
Fernandez, ¶ 50).
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obvious to a person of ordinary skill in the art at the time Appellants’
invention was made, in view of the combination of at least Walker,
Tadakuma, and ABI (see Ans. 4–6 and 13).
Walker discloses “[a] system and method for rewarding a customer’s
loyalty to a retail establishment . . . by offering a progressive discount on
[the customer’s] purchases,” and describes that the system includes a
POS controller that determines the amount of the customer discount
(see Walker, Abstract). As best shown in Figure 1, purchasing system 100
includes POS controller 102 and a plurality of POS terminals 104 in
communication with POS controller 102 (Walker, Fig. 1 and col. 4, ll. 11–
18). Walker describes that POS terminal 104 maintains a subtotal of the
transaction as each purchase item is scanned through an input device; then,
after the discount amount is determined by POS controller 102 (i.e., by
multiplying subtotal by the percentage discount, see Walker, col. 12, ll. 20–
35), the POS controller deducts the discount from the subtotal, and adds any
applicable taxes to generate a total purchase amount for the transaction
(see, e.g., Walker, col. 5, ll. 10–27).
The Examiner acknowledges that Walker “does not expressly
teach . . . directing the point of sale device to reverse calculate [a] tax
amount and a pre-tax subtotal amount using the total transaction amount and
a tax rate stored on the point of sale device” (Ans. 13; see also Ans. 4–5).
However, the Examiner notes that Tadakuma discloses that “it is old and
well known in the business art to store relevant tax information at POS
terminals . . . .” (Ans. 9, citing Tadakuma, col. 2, ll. 55–65 and col. 4, ll. 1–
50), and further observes that ABI describes that “it is old and well known in
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the promotion art that the application of a discount to a purchase transaction
must follow tax laws that are unique to each state in the United States” (id.).
ABI discloses that in conventional systems, the total transaction
amount is entered into a stand-alone POS device, which is responsible for
calculating the discount amount. And ABI explains that because different
states have different tax laws governing how a discount amount should be
calculated, e.g., as a pre-tax or post-tax amount, simply directing the POS to
apply any applicable discount to the total transaction amount may be
problematic in some states, i.e., the calculated discount amount may be
improperly inflated based on the inclusion of the tax amount in the total
transaction amount in those states where discounts are calculated on a pre-
tax basis (see Spec. ¶¶ 3–5).
Appellants argue that a reverse calculation is not taught, suggested, or
otherwise rendered obvious by the prior art, and that there is no reason, with
the Walker system, to reverse calculate a tax amount because Walker
discloses that the subtotal of the current transaction is provided to the
POS terminal (App. Br. 8–11). Claim 42, however, is not rejected over
Walker alone; instead, the claim is rejected over a combination of
references, including Walker, Tadakuma, and ABI. The argument that a
single reference alone does not disclose all the recited claim limitations is
not persuasive because nonobviousness “cannot be established by attacking
the references individually when the rejection is based on the teachings of a
combination of references.” See In re Merck & Co., 800 F.2d 1091, 1097
(Fed. Cir. 1986) (citation omitted).
The Supreme Court also has made clear that when considering
obviousness “the analysis need not seek out precise teachings directed to the
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specific subject matter of the challenged claim, for a court can take account
of the inferences and creative steps that a person of ordinary skill in the art
would employ.” KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398, 418 (2007).
We agree with the Examiner that it would have been obvious to a person of
ordinary skill in the art to modify the Walker POS device to store tax rate
information, as taught by Tadakuma, and, upon receipt of a total transaction
amount, including tax, as disclosed in ABI, to reverse calculate a tax amount
and a pre-tax subtotal amount using the total transaction amount and the
stored tax rate information so as to take into account state tax laws,
e.g., mandating pre-tax discounts, in calculating the applicable discount
amount.
Contrary to Appellants’ arguments, we find that the Examiner does
not engage in permissible hindsight or otherwise improperly rely on
Appellants’ disclosure as a guide (App. Br. 11–13). Instead, the Examiner
properly relies on the teachings of the cited references themselves, including
ABI, i.e., Appellants’ admitted prior art.
We also are not persuaded of error on the part of the Examiner by
Appellants’ argument that none of the cited references discloses or suggests
that the POS device is configured to operate in an offline manner,
i.e., “wherein the point of sale device operates in an offline manner,” as
recited in claim 42 (App. Br. 14–15). Instead, we agree with the Examiner
that Fernandez teaches this feature (see Ans. 6, citing Fernandez, ¶¶ 10 and
26; see also Ans. 13), and also agree that modifying the Walker POS device
to operate offline, as taught by Fernandez, is nothing more than a
combination of prior art elements according to their established functions,
and yields a predictable result (Ans. 6). Therefore, it would have been
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obvious at the time of Appellants’ invention to a person of ordinary skill in
the art. See KSR, 550 U.S. at 416 (“The combination of familiar elements
according to known methods is likely to be obvious when it does no more
than yield predictable results”).
Appellants argue that modifying the Walker system to operate offline
would require multiple processing changes throughout the system, and
vastly change how each part of Walker operates (App. Br. 14–15). Yet the
test for obviousness is not whether the features of one reference may be
bodily incorporated into the structure of another reference; instead, the test is
what the combined teachings of those references would have suggested to a
person of ordinary skill in the art. See In re Sneed, 710 F.2d 1544, 1550
(Fed. Cir. 1983) (“[I]t is not necessary that the inventions of the references
be physically combinable to render obvious the invention under review.”)
(citations omitted); see also In re Keller, 642 F.2d 413, 425 (CCPA 1981);
In re Nievelt, 482 F.2d 965 (CCPA 1973) (“Combining the teachings of
references does not involve an ability to combine their specific structures.”).
In view of the foregoing, we sustain the Examiner’s rejection of
claim 42 under 35 U.S.C. § 103(a). We also sustain the Examiner’s
rejection of claims 16–21, 23, 29–37, 43, 44, 46–48, 53–55, 57–59, 63, and
69–71, which fall with claim 42.
Dependent claim 72
Claim 72 depends from claim 42, and recites that the method further
comprises “directing the point-of-sale device to periodically transmit
statistics and historical information to a host computer.”
Appellants argue that Fernandez, on which the Examiner relies, does
not teach or suggest the subject matter of claim 72 because “Fernandez only
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recites that ‘[e]ach card may contain various data which can be read and
employed in various recordkeeping, accounting and statistical functions’
(see Fernandez, paragraph [0010])” and “does not disclose ‘periodically’
transmitting statistics and historical information from a POS device” (App.
Br. 15–16). However, we agree with the Examiner that Fernandez teaches
this feature at paragraph 27 (Ans. 19–20).
Therefore, we sustain the Examiner’s rejection of claim 72 under
35 U.S.C. § 103(a).

DECISION
The Examiner’s rejection of claims 16–21, 23, 29–37, 42–44, 46–48,
53–55, 57–59, 63, and 69–72 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)(1)(iv).

AFFIRMED

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