Ex Parte Darr

Patent Trial and Appeal Board

Sep 12, 2014

10798551 (P.T.A.B. Sep. 12, 2014)

UNITED STATES PATENT AND TRADEMARK OFFICE
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BEFORE THE PATENT TRIAL AND APPEAL BOARD
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Ex parte JAMES J. DARR
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Appeal 2012-002275
Application 10/798,551
Technology Center 3600
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Before MURRIEL E. CRAWFORD, BIBHU R. MOHANTY, and
BART A. GERSTENBLITH, Administrative Patent Judges.

CRAWFORD, Administrative Patent Judge.

DECISION ON APPEAL

STATEMENT OF THE CASE
Appellant seeks our review under 35 U.S.C. § 134 of the Examiner’s
final decision rejecting claims 1–8 and 12–24. We have jurisdiction over the
appeal under 35 U.S.C. § 6(b).
We AFFIRM.

BACKGROUND
Appellant’s invention is directed to a fund raising program for non-
profit organizations utilizing life insurance.

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Application 10/798,551

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Claim 1 is illustrative:
1. A system for raising funds for a first organization,
the system comprising:
a memory for storing executable instructions; and
a processor for performing the steps comprising:
identifying one or more individuals associated with the
first organization;
requesting enrollment of the one or more identified
individuals in a program permitting the first organization to
take out an insurance policy on each life of the one or more
identified individuals naming the first organization as
beneficiary and granting the first organization an irrevocable
right to utilize the insurance policy on each life of the one or
more identified individuals to serve the best interests of the first
organization;
receiving information from one or more of the identified
individuals accepting the enrollment;
selecting one or more of the one or more enrolled
individuals based upon the received information to create a
structured financial asset comprising one or more insurance
policies for each of the selected individuals, wherein the one or
more insurance policies are selectively grouped based upon
actuarial matrices or formulas into the structured financial asset;
facilitating payment of premiums for the structured
financial asset;
holding the structured financial asset of the first
organization in a passive vehicle;
providing, by a second organization, capital to the first
organization as evidenced by a promissory note secured by the
structured financial asset;
transferring a right or a benefit that the passive vehicle
receives with respect to the structured financial asset as
repayment of the promissory note to the second organization;
and

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Application 10/798,551

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wherein the structured financial asset generates a variable
net cash flow, after the payment of premiums, based upon and
timed by mortality payments and not based upon and timed by
an expected mortality rate.

Appellant appeals the following rejections:
Claims 1–5, 7, 8, 12–20, and 22–24 under 35 U.S.C. § 102(e) as
anticipated by Herman (US 2002/0035489 A1; pub. Mar. 21, 2002).
Claims 6 and 21 under 35 U.S.C. § 103(a) as unpatentable over
Herman.

ISSUE
Did the Examiner err in rejecting claim 1 because Herman does not
disclose wherein the structured financial asset generates a variable net cash
flow based upon and timed by the mortality payments and not based upon
and timed by an expected mortality rate?

FACTUAL FINDINGS
We adopt the Examiner’s findings as our own. Ans. 4–6, 10–12.
Additional findings of fact may appear in the Analysis that follows.

ANALYSIS
We are not persuaded of error on the part of the Examiner by
Appellant’s argument that Herman does not disclose wherein the structured
financial asset generates a variable net cash flow based upon and timed by
the actual mortality payments, and not based upon and timed by an expected
mortality rate. See App. Br. 13–14. We find that Herman discloses at

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Application 10/798,551

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paragraphs 7–9 a foundation funds generation system in which insurance
policies are obtained on a block of individuals, and the death benefits from
the insurance policy are used to make payments on a loan. We find that
Herman also discloses that in the event that there is a shortfall in the death
benefits, a re-insurer makes payments based on a re-insurance policy thereby
protecting the lender. We agree with the Examiner that a shortfall in
benefits occurs when there are not enough benefits available to make loan
payments based on the actual deaths of the insured. As such, by teaching
that there is a provision for a re-insurer, Herman discloses that the death
benefits described are benefits based on actual mortalities. We note that
claim 1 does not exclude payments made under a second asset such as a re-
insurance policy to supplement the payments made under the first asset.
In view of the foregoing, we will sustain the Examiner’s rejection of
claim 1. We will also sustain the Examiner’s rejection of claims 2–5, 7, 8,
12–20, and 22–24 because Appellant makes the same arguments in response
to the rejection of the remaining claims as is made in response to the
rejection of claim 1. See App. Br. 16–26.
We will also sustain the Examiner’s rejection of claims 6 and 21
under 35 U.S.C. § 103(a) because the Appellant makes the same arguments
in response to this rejection as was made in response to the anticipation
rejection discussed above.

DECISION
The decision of the Examiner is affirmed.

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Application 10/798,551

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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) (2011).

AFFIRMED

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