Ex Parte Phillips

Patent Trial and Appeal BoardAug 23, 2017

14530475 (P.T.A.B. Aug. 23, 2017)

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. 14/530,475 10/31/2014 ANDREW M. PHILLIPS CARDF-P3 874.4 6236 21259 7590 08/25/2017 J. MARK HOLLAND AND ASSOCIATES J. Mark Holland 19800 MAC ARTHUR BLVD SUITE 300 IRVINE, CA 92612 EXAMINER CHEIN, ALLEN C ART UNIT PAPER NUMBER 3627 NOTIFICATION DATE DELIVERY MODE 08/25/2017 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): OFFICE@JMHLAW.COM mholland @j mhlaw. com PTOL-90A (Rev. 04/07) UNITED STATES PATENT AND TRADEMARK OFFICE BEFORE THE PATENT TRIAL AND APPEAL BOARD Ex parte ANDREW M. PHILLIPS Appeal 2016-000713 Application 14/530,4751 Technology Center 3600 Before HUBERT C. LORIN, NINA L. MEDLOCK, and BRUCE T. WIEDER, Administrative Patent Judges. WIEDER, Administrative Patent Judge. DECISION ON APPEAL This is a decision on appeal under 35U.S.C. § 134 from the Examiner’s final rejection of claims 1—10. We have jurisdiction under 35 U.S.C. § 6(b). We AFFIRM. 1 According to Appellant, the real parties in interest are Andrew M. Phillips and Cardflex, Inc. (Appeal Br. 3.) Appeal 2016-000713 Application 14/530,475 CLAIMED SUBJECT MATTER Appellant’s claimed invention relates to “streamlining] the disbursement process for service establishments that regularly pay gratuities to employees.” (Spec. 2,11. 1—2.) Claims 1 and 2 are the independent claims on appeal. Claim 1 is illustrative. It recites: 1. A method of administering and distributing tips received from customers, including: a. providing a re-loadable debit card to a person who receives tips; b. using the POS device to enter information regarding the tips received by that person; c. periodically processing the information to determine what tip(s) have been earned by what person(s); d. uploading that calculated tip amount to the person’s debit card, bank account or other receptacle. REJECTIONS Claims 1—10 are rejected under 35U.S.C. § 101 as directed to non- statutory subject matter. Claims 1—10 are rejected under 35 U.S.C. § 103(a) as unpatentable in view of Kessler (US 2013/0103579 Al, pub. Apr. 25, 2013) and Marshall (US 2008/0065396 Al, pub. Mar. 13, 2008). ANALYSIS The §101 rejection In 2014, the Supreme Court decided Alice Corp. Pty. Ltd. v. CIS Bank Int’l, 134 S. Ct. 2347 (2014). Alice applies a two-part framework, earlier set out in Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66 2 Appeal 2016-000713 Application 14/530,475 (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, 134 S. Ct. at 2355. Under the two-part framework, it must first be determined if “the claims at issue are directed to a patent-ineligible concept.” Id. If the claims are determined to be directed to a patent-ineligible concept, then the second part of the framework is applied to determine if “the elements of the claim . . . contain[] an ‘inventive concept’ sufficient to ‘transform’ the claimed abstract idea into a patent-eligible application.” Id. at 2357 (citing Mayo, 566 U.S. at 72-73, 79). With regard to part one in the Alice framework, the Examiner determines that “[c]laim(s) 1—10 is/are directed to steps for managing and distributing gratuities, a fundamental economic practice,” i.e., that the claims are directed to an abstract idea. (Final Action 4; see also Answer 2.) Appellant disagrees and argues that the “claims are directed to specific physical elements and structures and processes by which . . . management and distribution [of gratuities] occurs.” (Appeal Br. 7.) Appellant specifically argues that the “claimed method (Claim 1) and apparatus (Claim 2) require the following physical elements: 1. a re loadable debit card, and 2. a POS (“point-of-sale”) device.” (Id. at 9.) The Examiner, however, finds that “the debit card is a conventional element used in a conventional manner” and that “[t]he ‘physical’ element of the POS is merely a conventional computing device being used in a conventional manner. ” (Answer 3.) Under part one of the Alice framework, we “look at the ‘focus of the claimed advance over the prior art’ to determine if the claim’s ‘character as a 3 Appeal 2016-000713 Application 14/530,475 whole’ is directed to excluded subject matter.” Affinity Labs of Texas, LLC v. DirectTV, LLC, 838 F.3d 1253, 1257 (Fed. Cir. 2016) (quoting Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d 1350, 1353 (Fed. Cir. 2016)). Thus, although we consider the claim as a whole, the “directed to” inquiry focuses on the claim’s “character as a whole.” In this case, the Specification discloses that the invention is directed to “the disbursement process for service establishments that regularly pay gratuities to employees.” (Spec. 2,11. 1—2.) The Specification further discloses “that the invention can be used to automate the tip pay-out process between Point-of-Service/Sale (POS) systems 20 (commonly used in restaurants and other businesses whose employees receive tips) and employees/staff who interact with the POS 20.” {Id. 4,11. 18—20.) Claim 1, in particular, recites the steps of “providing a re-loadable debit card,” “using the POS device to enter information,” “processing the information to determine [tip amounts],” and “uploading that calculated tip amount to the person’s debit card, bank account, or other receptacle.” (See Claim 1.) The Federal Circuit has recognized that claims directed to “1) collecting data, 2) recognizing certain data within the collected data set, and 3) storing that recognized data in memory” are drawn to an abstract idea. Content Extraction and Transmission LLC v. Wells Fargo Bank, Nat’l Assn, 776 F.3d 1343, 1347 (Fed. Cir. 2014). The Federal Circuit explained that “[t]he concept of data collection, recognition, and storage is undisputedly well-known. . . . And banks have, for some time, reviewed checks, recognized relevant data such as the amount, account number, and identity of account holder, and stored that information in their records.” Id. In this case, the focus of the claims is to collecting data, 4 Appeal 2016-000713 Application 14/530,475 recognizing/processing tip amounts, and storing/uploading the tip information in the appropriate account records (e.g., debit card or bank account). Therefore, we are not persuaded that the Examiner erred in determining that the claims are directed to an abstract idea, i.e., “managing and distributing gratuities.” (See Final Action 4.) We next look to part two of the Alice framework, which has been described “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.’” Alice, 134 S. Ct. at 2355 (citing Mayo, 566 U.S. at 72—73). “The Court in Alice made clear that a claim directed to an abstract idea does not move into section 101 eligibility territory by ‘merely requiring] generic computer implementation.’ Alice, 134 S. Ct. at 2357.” buySAFE, Inc. v. Google, Inc., 765 F.3d 1350, 1354 (Fed. Cir. 2014.) In this case, Appellant acknowledges that the recited “physical elements” are generic. (See Appeal Br. 9.) Specifically, Appellant notes that “[w]e all use debit cards” and “POS devices are virtually ubiquitous.” (Id. ) Appellant does not argue that the “at least one computer” recited in claim 2 requires anything other than a generic computer. Taking the claim elements separately, the function performed by the computer system (including the POS device) at each step of the process is purely conventional. Using a computer to collect data, determine values, and store the values in the appropriate account records are basic computer functions. In other words, each step does no more than require a generic computer to perform generic computer functions. 5 Appeal 2016-000713 Application 14/530,475 Considered as an ordered combination, the components of Appellant’s method and apparatus add nothing that is not already present when the steps are considered separately. Viewed as a whole, claim 1 simply recites the concept of entering information on a POS device, determining tip amounts from that information, and storing the determined tip amounts in a provided debit card, bank account, or other receptacle. The claims do not, for example, purport to improve the functioning of the computer itself. Nor do they effect an improvement in any other technology or technical field. That is not enough to transform an abstract idea into a patent-eligible invention. See id. at 2360. Therefore, we are not persuaded that the Examiner erred in rejecting claims 1 and 2 under § 101. Appellant does not separately argue dependent claims 3—10. Claims 3—10 fall with claims 1 and 2. See 37 C.F.R. § 41.37(c)(l)(iv). The § 103(a) rejection The Examiner finds that “Kessler discloses: a. providing a re loadable debit card to a person who receives tips; c. periodically processing the information to determine what tip(s) have been earned by what person(s); d. uploading that calculated tip amount to the person’s debit card, bank account or other receptacle.” (Final Action 3; see also id. at 5—7.) The Examiner relies on Marshall for its disclosure that ‘“non-cash transactions may be processed via the POS system by entering the data via a cash register or cash register terminal. Such non-cash transactions may include meal charges, bar charges, non-cash tips, non-cash gratuities, and the like.’ (Marshall, para 0071).” (Id.; see also id. at 7—8.) 6 Appeal 2016-000713 Application 14/530,475 Kessler discloses “systems and methods for collecting and disbursing electronic gratuities.” (Kessler, Abstract.) Marshall discloses “systems and methods for recording, maintaining, and reporting tips and gratuities.” (Marshall, Abstract.) The Examiner determines that it “would have been obvious to one of ordinary skill in the art at the time the invention was made to combine [Kessler] with the POS of Marshall with the motivation of capturing gratuities entered at POS terminals. (Marshall, para 0070).” (Final Action 8.) Appellant argues that prior to the present invention, no gratuity disbursement systems existed which tied together reporting technologies with direct deposit solutions......... The absence of such an integrated gratuity gathering/disbursement system in the market, despite the very apparent need for and benefits of such a combination in one streamlined solution, is by itself evidence that it is NOT obvious to combine prior art systems (in the form asserted by the Examiner or otherwise). (Appeal Br. 11.) Appellant, however, cites no evidence to support the argument that there existed a need for the claimed invention or that the claimed invention satisfied the alleged need. Therefore, we do not find this argument persuasive. Appellant additionally argues that “Kessler does not disclose or suggest the claimed methods of processing and disbursing tips received at a POS (point-of-sale) to persons receiving those tips. ... In other words, Kessler does not have anything to do with a ‘sale’ or a POS device/system.” {Id. at 13.) Appellant further argues that “Kessler in no way discloses or suggests combining his ‘electronic tip jar’ with another system to yield Appellant’s claimed gratuity disbursement solution.” {Id.) 7 Appeal 2016-000713 Application 14/530,475 But whether Kessler itself discloses combining its invention with another system is not determinative. The test for obviousness is not what any one reference would have suggested, but rather what the combined teachings would have suggested to one of ordinary skill in the art. See In re Keller, 642 F.2d 413, 426 (CCPA 1981). And in this case, the Examiner relies on the combined teachings of Kessler and Marshall. (See id. at 5—10.) We are not persuaded of error. Appellant further argues that Kessler’s disclosure is directed to a “stand alone” tip activity, independent of any purchase by the patron. This further suggests and highlights the fact that Kessler in no way intended for his electronic gratuity device to be used with a point-of-sale system and/or a reloadable debit card or other depository system. Therefore, the Examiner’s assumption that it would be obvious to combine Kessler with another prior art system (such as the cited Marshall ’396 patent) is based upon improper hindsight reconstruction. (Appeal Br. 13—14.) The Examiner answers that [t]he device of Kessler is integrated with a system for distributing those tips to accounts/cards. (Kessler, para 0041). Kessler differs from Appellant’s invention in that the claimed tip information collection device is a POS. Although Kessler discloses a “stand alone” tip device, the examiner finds no “teaching away” that tip information should not be entered from another type of device, such as a POS. Kessler is silent on the subject. Accordingly, the Examiner relies upon the Marshall reference, which discloses a system where gratuity information could be entered into a POS device. (Answer 4—5.) 8 Appeal 2016-000713 Application 14/530,475 As noted above, the test for obviousness is not what any one reference would have suggested, but rather what the combined teachings would have suggested to one of ordinary skill in the art. See In re Keller, 642 F.2d at 426. Thus, we are not persuaded that Kessler’s silence on entering tip information from another device shows Examiner error in the proposed combination of Kessler and Marshall. In view of the above, we are not persuaded that the Examiner erred in determining that it “would have been obvious to one of ordinary skill in the art at the time the invention was made to combine [Kessler] with the POS of Marshall with the motivation of capturing gratuities entered at POS terminals.” (Final Action 8.) Appellant does not separately argue claims 2— 10. Claims 2-10 fall with claim 1. See 37 C.F.R. § 41.37(c)(l)(iv). DECISION The Examiner’s rejection of claims 1—10 under 35 U.S.C. § 101 is affirmed. The Examiner’s rejection of claims 1—10 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 9