Ex Parte Ferguson et al

Patent Trials and Appeals Board

Jan 25, 2019

13030794 - (D) (P.T.A.B. Jan. 25, 2019)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE FIRST NAMED INVENTOR
13/030,794 02/18/2011 William M. Ferguson
66945 7590 01/29/2019
KILPATRICK TOWNSEND & STOCKTONLLP/VISA
Mailstop: IP Docketing - 22
1100 Peachtree Street
Suite 2800
Atlanta, GA 30309
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.
206203-1016-106 3458
EXAMINER
OBAID,FATEHM
ART UNIT PAPER NUMBER
3627
NOTIFICATION DATE DELIVERY MODE
01/29/2019 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):
ipefiling@kilpatricktownsend.com
KTSDocketing2@kilpatrick.foundationip.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte WILLIAM M. FERGUSON, STEVEN A. WICKERT,
MARY A. REEDER, and ANUK. PATHRIA1
Appeal2017-009258
Application 13/030,794
Technology Center 3600
Before JAMES R. HUGHES, CATHERINE SHIANG, and
JOHN P. PINKERTON, Administrative Patent Judges.
HUGHES, Administrative Patent Judge.
DECISION ON APPEAL
STATEMENT OF THE CASE
Appellants seek our review under 35 U.S.C. § 134(a) of the
Examiner's decision rejecting claims 1-11 and 21-30. Claims 12-20 have
been canceled. Final Act. 1-2.2 We have jurisdiction under 35 U.S.C.
§ 6(b ).
1 The real party in interest, according to Appellants, is Visa International
Service Association. See Appeal Br. 2.
2 We refer to Appellants' Specification ("Spec.") filed Feb. 18, 2011
(claiming benefit of 61/306,369 filed Feb. 19, 2010); Appeal Brief ("Appeal
Br.") filed Dec. 5, 2016; Supplemental Appeal Brief ("Supp. App. Br.") filed
Dec. 2 8, 2016; and Reply Brief ("Reply Br.") filed June 14, 2017. We also
refer to the Examiner's Final Office Action (Final Rejection) ("Final Act.")
mailed July 1, 2016, and Answer ("Ans.") mailed Apr. 14, 2017.
Appeal2017-009258
Application 13/030,794
We affirm.
Appellants 'Invention
The invention "relates generally to authentication of financial account
transactions ... and, more specifically, to computerized authentication of
transactions" (Spec. ,r 2). See Spec. ,r,r 3, 15-17; Abstract.
Representative Claim
Independent claim 1, reproduced below, further illustrates the
invention:
1. A method implementable in a computing system,
compnsmg:
storing, with at least one processing device, an indication
of a location of a pending travel destination in a memory device,
the indication of the location of the pending travel destination
based at least on a posting of a travel-related financial
transaction, the posting resulting from a posting transaction that
triggers a money transfer from an issuer bank to a merchant bank;
receiving, with the at least one processing device, a current
transaction authorization request for a current transaction from a
point of service;
determining, with the at least one processing device, that
a location of the point of service and the location of the pending
travel destination obtained from the posting of the travel-related
financial transaction are within a predetermined distance;
after determining that the location of the point of service
and the location of the pending travel destination are within the
predetermined distance, determining, with the at least one
processing device, that the current transaction is low risk;
generating, with the at least one processing device, a
transaction approval indication when the location of the point of
service and the location of the pending travel destination are
within the predetermined distance; and
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transmitting, with the at least one processing device, the
transaction approval indication to the point of service.
Rejection on Appeal
The Examiner rejects claims 1-11 and 21-30 under 35 U.S.C. § 101
as being directed to patent-ineligible subject matter.
ISSUE
Based upon our review of the record, Appellants' contentions, and the
Examiner's findings and conclusions, the issue before us follows:
Did the Examiner err in finding Appellants' claims were directed to
patent-ineligible subject matter under 35 U.S.C. § 101?
ANALYSIS
The Examiner rejects claims 1-11 and 21-30 as a group based on
claim 1 (see Final Act. 2-5) and concludes claim 1 is directed to patent-
ineligible subject matter in that claim 1 is "directed to a series of steps for a
travel-related financial transaction, which are a fundamental economic
practice," which "consist of mere methods and instructions to apply the
abstract idea," and do not recite an "improvement to another technology or
technical field, [nor] improvements to the functioning of the computer itself,
[nor] meaningful limitations beyond generally linking the use of an abstract
idea to a particular technical environment." Final Act. 2; see Final Act. 3-5;
Ans. 2-7. The Examiner further determines that "[ t ]he claims do not include
additional elements that are sufficient to amount to significantly more than
the judicial exception because the claims require no more than a general
purpose computer to perform generic computer functions that are well-
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understood, routine and conventional." Final Act. 2; see Final Act. 3-5;
Ans. 2-7.
Appellants contend the Examiner erred in rejecting the claims as
being directed to patent-ineligible subject matter. See Appeal Br. 7-12;
Reply Br. 2-6. Specifically, Appellants contend that "the claims are not
directed to an 'abstract idea"' (Appeal Br. 7) and that the Examiner has not
properly identified the purportedly abstract idea-"the Examiner has failed
to establish that the abstract idea is 'similar to at least one concept that the
courts have identified as an abstract idea' or that the alleged abstract idea
was well known." Appeal Br. 7-8; see Reply Br. 2-5. Appellants also
contend claim 1 ( and independent claim 21) do not preempt the Examiner's
proposed abstract idea (i.e., recite a practical application}-"the claims
recite meaningful limitations that sufficiently limit the practical application
of the alleged abstract idea of 'travel-related financial transactions' and thus
do 'not seek to tie up any judicial exception such that others cannot practice
it' and constitute patent-eligible subject matter." Appeal Br. 8-9; see Reply
Br. 5. Appellants further contend the claims are "rooted in computer
technology ... [and] overcome a problem specifically arising in the realm of
computer technology" similar to the claims in DDR Holdings. Appeal Br. 9;
see Appeal Br. 9-10; Reply Br. 5 (citing DDR Holdings, LLC v. Hotels.com,
L.P., 773 F.3d 1245 (Fed. Cir. 2014)). Additionally, Appellants contend the
claims "recite significantly more than the judicial exception" (Appeal Br.
10) in that the claims recite "specific limitation[ s] other than what is well-
understood, routine and conventional in the field" (Appeal Br. 11) and
represent an improvement in a technological field-"an improved
transaction processing system that reduces the number of declined
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transactions relative to conventional transaction processing system" (Appeal
Br. 11 (emphasis omitted)). See Appeal Br. 10-12; Reply Br. 5---6.
Under 35 U.S.C. § 101, a patent may be obtained for "any new and
useful process, machine, manufacture, or composition of matter, or any new
and useful improvement thereof." The Supreme Court has "'long held that
this provision contains an important implicit exception: Laws of nature,
natural phenomena, and abstract ideas are not patentable."' Alice Corp. Pty.
v. CLS Bankint'l, 573 U.S. 208,216 (2014) (quotingAss'nfor Molecular
Pathology v. Myriad Genetics, Inc., 569 U.S. 576, 589 (2013)).
The Supreme Court, in Alice, reiterated the two-step framework
previously set forth in Mayo Collaborative Services v. Prometheus
Laboratories, Inc., 566 U.S. 66, 77-80 (2012), "for distinguishing patents
that claim laws of nature, natural phenomena, and abstract ideas from those
that claim patent-eligible applications of those concepts." Alice, 573 U.S. at
217. Assuming that a claim nominally falls within one of the statutory
categories of machine, manufacture, process, or composition of matter, the
first step in the analysis is to "determine whether the claims at issue are
directed to one of those patent-ineligible concepts" (id.), e.g., to an abstract
idea. 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. Kappas, 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, but are not limited to, 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
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formulas (Parker v. Flook, 437 U.S. 584, 594--95 (1978)); and mental
processes (Gottschalkv. Benson, 409 U.S. 63, 69 (1972)). If the claims are
not directed to an abstract idea, the inquiry ends. Otherwise, the inquiry
proceeds to the second step of the Alice and Mayo framework where the
elements of the claims are considered "individually and 'as an ordered
combination' to determine whether the additional elements 'transform the
nature of the claim' into a patent-eligible application." Alice, 573 U.S. at
217 (quoting Mayo, 566 U.S. at 78-79). This second step is described as "a
search for an 'inventive concept'-i.e., an element or combination of
elements that is ' ... significantly more than ... the [ineligible concept]
itself."' Id. at 217-18 (alteration in original) (quoting Mayo, 566 U.S. at 72-
73). "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]."' Alice, 573 U.S. at 221 (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.
The Court acknowledged in Mayo that "all inventions at some level
embody, use, reflect, rest upon, or apply laws of nature, natural phenomena,
or abstract ideas." Mayo, 566 U.S. at 71. We, therefore, look to whether the
claims focus on a specific means or method that improves the relevant
technology or are instead directed to a result or effect that itself is the
abstract idea and merely invoke generic processes and machinery. See
Enfzsh, LLC v. Microsoft Corp., 822 F.3d 1327, 1336 (Fed. Cir. 2016).
The PTO recently published revised guidance on the application of
§ 101. USPTO's 2019 Revised Patent Subject Matter Eligibility Guidance,
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84 Fed. Reg. 50 (Jan. 7, 2019) (hereinafter "2019 Revised Guidance").
Under that 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 interactions such as a fundamental economic practice, or
mental processes); and
(2) additional elements that integrate the judicial exception into a
practical application (see MPEP § 2106.05(a}-(c), (e}-(h)).
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
§ 106.05(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.
See 2019 Revised Guidance.
Eligibility Analysis-Alice Step 1 (Revised Guidance Steps 1 and 2A)
Turning to the first step of the eligibility analysis, "the first step in the
Alice inquiry ... asks whether the focus of the claims is on the specific
asserted improvement in computer capabilities ... or, instead, on a process
that qualifies as an 'abstract idea' for which computers are invoked merely
as a tool." Enfzsh, 822 F.3d at 1335-36. "The abstract idea exception
prevents patenting a result where 'it matters not by what process or
machinery the result is accomplished."' McRO, Inc. v. Bandai Namco
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Games Am. Inc., 837 F.3d 1299, 1312 (Fed. Cir. 2016) (quoting O'Reilly v.
Morse, 56 U.S. (15 How.) 62, 113 (1853)).
The Examiner determines independent claim 1 is directed to the
abstract idea of providing "travel-related financial transaction[s], which are a
fundamental economic practice." Final Act. 2. Here, in rejecting the claims
(in particular claim 1) under 35 U.S.C. § 101, the Examiner analyzed the
claims using the Mayo/Alice two-step framework, consistent with the
guidance set forth in the USPTO's "2014 Interim Guidance on Patent
Subject Matter Eligibility," 79 Fed. Reg. 74618 (Dec. 16, 2014), in effect at
the time the rejection was made, i.e., on July 1, 2016. We agree with the
Examiner that Appellants' claim 1 ( and the other pending claims) are
directed to patent-ineligible abstract ideas or concepts. In view of the 2019
Revised Guidance, we clarify and expand the Examiner's reasoning as
follows.
Claim 1 recites a method for authorizing a transaction ( approving a
transaction authorization request, or providing a transaction approval). The
claim recites a method (process) which is a statutory category of invention
(subject matter) (USPTO's Step 1 ). The method provides a transaction
approval by (1) determining and storing a pending travel destination location
indication----determining a location of a pending travel destination utilizing
(based on) a posting of a travel-related financial transaction that triggers a
money transfer from an issuer bank to a merchant bank and storing an
indication of the pending travel destination in memory; (2) receiving a
(current) transaction authorization request from a point of service ("POS ")
( e.g., a merchant or ATM); (3) determining that a location of the POS and
the location of the pending travel destination are within a predetermined
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distance-which intrinsically requires ascertaining a location of the POS
prior to the determination ( that the locations are within a predetermined
distance); ( 4) determining that the current transaction is low risk; and ( 5)
generating a transaction approval indication (when the locations are within a
predetermined distance), and transmitting the transaction approval indication
to the point of service.
Utilizing this interpretation of claim 1, we analyze whether the claim
is directed to an abstract idea (USPTO's Step 2A). Here, Appellants' claims
generally, and independent claim 1 in particular, relate to authorizing a
transaction or providing a transaction approval. That is,
ascertaining/determining a pending travel destination location, analyzing
whether a location of the POS (from which a transaction authorization
request is received) and the location of the pending travel destination are
within a predetermined distance, determining that the current transaction is
low risk, and approving the transaction request (generating and transmitting
a transaction approval to the POS) utilizing a processing device. This is
consistent with how Appellants describe the claimed invention. See Appeal
Br. 2-3 (citing Spec. ,r,r 15-17; Fig. 2).
Appellants' claim 1 recites a judicial exception (USPTO' s Step 2A,
Prong 1; see 2019 Revised Guidance). Providing a transaction approval by
the process of ascertaining a pending travel destination location, ascertaining
a location (POS location) from which a transaction authorization request is
received, analyzing whether the POS location and the location of the
pending travel destination are within a predetermined distance, determining
that the current transaction is low risk, and approving the transaction request
(generating and transmitting a transaction approval to the point of service) is
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a method of organizing human activity, in particular, a fundamental
economic practice.
Transaction authorization processes are well-known business practices
that are not patent eligible. See Smart Sys. Innovations, LLC v. Chicago
Transit Auth., 873 F.3d 1364, 1371-72 (Fed. Cir. 2017) ("Taken together,
the Asserted Claims are directed to the formation of financial transactions in
a particular field ... and data collection related to such transactions," which
is "an abstract idea under Alice step one."); Content Extraction &
Transmission LLC v. Wells Fargo Bank, Nat 'l Ass 'n, 776 F.3d 1343, 1347
(Fed. Cir. 2014) (summarizing precedent in which "claims directed to the
performance of certain financial transactions" involve abstract ideas and
holding that claims drawn to the abstract concept of financial transaction-
related "data collection, recognition, and storage is undisputedly well-
known."); CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d 1366, 1370
(Fed. Cir. 2011) (finding computer-implemented system for "verifying the
validity of a credit card transaction over the Internet" to be patent-ineligible
subject matter); see also Smariflash LLC v. Apple Inc., 680 F. App'x 977,
982 (Fed. Cir. 2017) (claims directed to "conditioning and controlling access
to data based on payment," i.e., authorizing access based on payment
validation (transaction approval) is an abstract idea-specifically, a
"fundamental economic practice.").
Appellants' claim 1 also recites additional elements beyond the
abstract transaction approval process (the judicial exception) (supra). These
elements include: (1) utilizing a processing device to store an indication of
the pending travel destination location-"storing, with at least one
processing device, an indication of a location of a pending travel destination
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in a memory device" ( claim 1 ); (2) utilizing the processing device to receive
a current transaction authorization request-"receiving, with the at least one
processing device, a current transaction authorization request" ( claim 1 ); (3)
utilizing the processing device to analyze information, i.e., whether the POS
location and the location of the pending travel destination are within a
predetermined distance and if the current transaction is low risk; and ( 4 ),
utilizing the processing device to approve the transaction request (generating
and transmitting a transaction approval to the point of service).
We evaluate these additional elements to determine whether the
additional elements integrate the abstract transaction approval process (the
judicial exception) into a practical application of the exception (USPTO's
Step 2A, Prong 2; see 2019 Revised Guidance). Appellants contend (supra)
that the claims do not preempt the abstract idea and "recite meaningful
limitations that sufficiently limit the practical application of the alleged
abstract idea." Appeal Br. 8. We disagree. Appellants' additional elements
( or the combination of the additional elements) do not apply or use the
transaction approval process (the judicial exception) in a manner that
imposes a meaningful limit on the judicial exception, such that it is more
than a drafting effort designed to monopolize the exception. See Alice, 573
U.S. at 221-24 (citing Mayo, 566 U.S. at 78-85). Rather, Appellants'
claims recite a processing device (a computer) that is utilized as a tool to
perform the transaction approval process (the abstract idea). Utilizing a
computer as a tool to perform the abstract idea does not impose a meaningful
limit on the abstract idea. See MPEP § 2106.05(±); see also Alice, 573 U.S.
at 223 ("if [the] recitation of a computer amounts to a mere instruction to
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implement an abstract idea on ... a computer that addition cannot impart
patent eligibility" (quotations and internal citations omitted)).
Appellants also contend (supra) that their claims are "rooted in
computer technology" and "overcome a problem specifically arising in the
realm of computer technology." Appeal Br. 9. Again, we disagree.
Appellants' claims can also be distinguished from patent-eligible claims
such as those in McRO, Enfzsh, and DDR Holdings that are directed to "a
specific means or method that improves the relevant technology" (McRO,
837 F.3d at 1314), or "a specific improvement to the way computers
operate" (Enfzsh, 822 F.3d at 1336), or a method "rooted in computer
technology in order to overcome a problem specifically arising in the realm
of computer [technology]" (DDR Holdings, 773 F.3d at 1257). Contrary to
Appellants' arguments, claim 1 is not a technological improvement or an
improvement in a technology. Appellants' claim 1 does not "improve the
functioning of the computer itself' or "any other technology or technical
field." Alice, 573 U.S. at 225. Nor, does it provide a technological solution
to a technological problem. See DDR Holdings, 773 F.3d at 1257. See
MPEP § 2106.05(a). Rather, Appellants' claims and, in particular, the
above-identified additional elements are similar to the claims in Alice (see
Alice, 573 U.S. at 225-26) and Versata Dev. Grp., Inc. v. SAP Am., Inc., 793
F.3d 1306, 1333-34 (Fed. Cir. 2015) in that the instant claims implement a
known business practice utilizing a general purpose computer.
In summary, "the focus of the claims is not on such an improvement
in computers as tools, but on certain independently abstract ideas that use
computers as tools." Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d 1350,
13 54 (Fed. Cir. 2016). Thus, we agree with the Examiner that the claims are
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directed to the abstract idea of performing "a series of steps for a travel-
related financial transaction, which are a fundamental economic practice"
(Final Act. 2), or as we clarify (supra), performing a transaction approval
process utilizing a generic computer.
Alice Step 2 Analysis
Having concluded Appellants' claims are directed to an abstract idea
under Alice's step 1 analysis, we next address whether the claims add
significantly more to the alleged abstract idea. As directed by our reviewing
court, we search for an "'inventive concept' sufficient to 'transform the
nature of the claim into a patent-eligible application."' McRO, 837 F.3d at
1312 ( quoting Alice, 573 U.S. at 217). The implementation of the abstract
idea involved must be "more than performance of 'well-understood, routine,
[and] conventional activities previously known to the industry."' Content
Extraction, 776 F.3d at 1347--48 (alteration in original) (quoting Alice, 573
U.S. at 225). The "inventive concept" "must be significantly more than the
abstract idea itself, and cannot simply be an instruction to implement or
apply the abstract idea on a computer." Bascom Global Internet Servs., Inc.
v. AT&T Mobility LLC, 827 F.3d 1341, 1349 (Fed. Cir. 2016) (citation
omitted).
Here, the Examiner determined that Appellants' claims do not add
significantly more:
The claims do not include additional elements that are sufficient
to amount to significantly more than the judicial exception
because they require no more than a generic computer to perform
generic computer functions ( e.g., storing, generating, receiving
and transmitting transaction) that are well-understood, routine
and conventional activities previously known in the industry.
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Final Act. 3; see Final Act. 2-5; Ans. 5-7. Appellants, on the other hand,
simply state that "the recited claims include many [] additional features"
(Appeal Br. 10) without explaining how such features are not well-
understood or unconventional. See Appeal Br. 10-12; Reply Br. 5---6.
Appellants fail to persuade us of error in the Examiner's rejection
with respect to the second Alice step. We agree with the Examiner that
Appellants' claim 1 ( and the other pending claims) does not evince an
"inventive concept" that is significantly more than the abstract idea itself.
Appellants fail to explain how the additional features ( additional elements,
see supra) (individually and in combination) are not routine or are
unconventional.
As previously discussed, claim 1 ( and the other pending claims)
merely recites utilizing a processing device (a conventional computer) to
store, receive, and analyze information, and to generate and transmit a
transaction approval. Appellants' Specification describes the processing
device as a conventional (generic) computer. Indeed, the only description
provided in Appellants' Specification for the recited "processing device"
delineates a "processor" (processor 102) that is part of a "computerized
system," including an interface and memory, communicating with a "data
store." Spec. ,r 11. Further, Appellants' Specification explains that "the
processor [] analyzes information previously stored in the ... data store"
(Spec. ,r 16), and "although the system 100 is shown as being separate from
the bank 112, the system 100 may be integrated within the systems of the
bank 112 rather than existing as a separate system accessed over a network"
(Spec. ,r 25).
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Such conventional computer processes operating on conventional
computer hardware "do not alone transform an otherwise abstract idea into
patent-eligible subject matter." FairWarning IP, LLC v. Iatric Sys., Inc.,
839 F.3d 1089, 1096 (Fed. Cir. 2016)(citing DDR Holdings, 773 F.3d at
1256).
For at least the reasons discussed above, we are not persuaded of
Examiner error in the rejection of claim 1 under 35 U.S.C. § 101. Thus, we
sustain the Examiner's rejection under§ 101 of independent claim 1,
independent claim 21, and dependent claims 2-11 and 22-30, which were
not separately argued with specificity.
CONCLUSION
Appellants have not shown that the Examiner erred in rejecting claims
1-11 and 21-30 under 35 U.S.C. § 101.
DECISION
We affirm the Examiner's rejection of claims 1-11 and 21-30.
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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