Ex Parte Weber

Patent Trial and Appeal Board

Jan 25, 2019

14193296 (P.T.A.B. Jan. 25, 2019)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE FIRST NAMED INVENTOR
14/193,296 02/28/2014 Lance Weber
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.
79900-899126(043900USNP) 6828
EXAMINER
TINKLER, MURIEL S
ART UNIT PAPER NUMBER
3692
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 LANCE WEBER
Appeal2017-003515
Application 14/193,296 1
Technology Center 3600
Before JOSEPH A. FISCHETTI, MEREDITH C. PETRA VICK, and
PHILIP J. HOFFMANN, Administrative Patent Judges.
FISCHETTI, Administrative Patent Judge.
DECISION ON APPEAL
STATEMENT OF THE CASE
Appellant seeks our review under 35 U.S.C. § 134 from the
Examiner's final rejection of claims 1, 2, 4, 7, 8, 10-12, 15-19, and 21-24.
We have jurisdiction under 35 U.S.C. § 6(b).
SUMMARY OF DECISION
We AFFIRM.
1 Appellant identifies Visa International Service Association as the real party
in interest. Appeal Br. 3.
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Application 14/193,296
THE INVENTION
Appellant states, a "server computer can provide a merchant or other
entity with a payment card ( or other payment device) detection service that
can determine a level of fraud based on the account type being presented
(e.g., credit, debit, prepaid, etc.) at the time of purchase." Abstract.
Claim 1 reproduced below, is representative of the subject matter on
appeal.
1. A method for processing an authorization request for a
transaction between a client computer of a consumer and a
merchant computer, the method comprising:
receiving, at a server computer from the merchant
computer via a communications network, transaction
information and the authorization request for the transaction,
the transaction information including an account number of an
account of the consumer, wherein the account number was
received by the merchant computer from the client computer;
parsing, by the server computer, the account number to
determine an identifier that includes an account type identifier;
sending, by the server computer, a query to an account
database, the query including the account type identifier;
receiving, by the server computer, an account type
corresponding to the account number from the account
database;
sending the transaction information and the account type
to a fraud detection engine of the server computer;
determining, by the fraud detection engine, a level of
fraud for the transaction using the account type and the
transaction information;
determining, by the server computer, an authorization
result for the transaction based on the fraud level, wherein the
authorization result includes a change in the transaction;
transmitting, by the server computer, information about
the change to the merchant computer via the communications
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network, as well as instructions to the merchant computer to
communicate with the client computer to determine whether the
change is accepted by the client computer;
receiving, by the server computer, a confirmation
response from the merchant computer via the communications
network indicating that the client computer accepted the
change; and
proceeding, by the server computer, to process the
changed transaction.
THE REJECTION
The Examiner relies upon the following as evidence of
unpatentability:
Elston et al. ("Elston")
Bhinder
US 2003/0191709 Al
US 2011/0302083 Al
The following rejections2 are before us for review:
Oct. 9, 2003
Dec. 8, 2011
Claims 1, 2, 4, 7, 8, 10-12, 15-19, and 21-24 are rejected under
35 U.S.C. § 101 as being directed to nonstatutory subject matter. Final
Act. 7-9.
Claims 1, 2, 4, 7, 8, 10-12, 163-19, and 21-24 are rejected under
2 Claim 21 is objected to and is not rejected. We generally have no
jurisdiction over an objection; therefore, we do not address the objection that
relates to a petitionable matter and not to an appealable matter. See In re
Schneider, 481 F.2d 1350, 1356-57 (CCPA 1973); In re Mindick, 371 F.2d
892, 894 (CCPA 1967); see also MPEP § I002.02(c), item 3(a), § 1201.
The relief sought by the Appellant would have been properly presented by a
petition to the Commissioner under 3 7 C.F .R. § 1.181 instead of by appeal
to this Board. Accordingly, we will not further consider this issue.
3 Although the Final Action on page 10 groups claim 15 as part of the 35
U.S.C. § I02(a)(l) anticipation rejection, it is not addressed there, but the
claim is separately rejected on page 14 of the Final Action under 35 U.S.C.
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35 U.S.C. § 102(a)(l) as being anticipated by Elston. Id. at 9-13.
Claim 15 is rejected under 35 U.S.C. § 103 as being unpatentable over
Elston and in further view of Bhinder. Id. at 13-14.
ANALYSIS
35 U.S.C. § 101 REJECTION
We will affirm the rejection of claims 1, 2, 4, 7, 8, 10-12, 15-19,
and 21-24 under 35 U.S.C. § 101.
The Appellant argued claims 1, 2, 4, 7, 8, 10-12, 15-19, and 21-24 as
a group. (Appeal Br. 7). We select claim 1 as the representative claim for
this group, and the remaining claims standing or falling with claim 1. See 3 7
C.F.R. § 4I.37(c)(l)(iv) (2015).
Under 35 U.S.C. § 101, an invention is patent-eligible if it claims a
"new and useful process, machine, manufacture, or composition of matter."
The Supreme Court, however, has long interpreted § 101 to include an
implicit exception: "[l]aws of nature, natural phenomena, and abstract
ideas" are not patentable. Alice Corp. Pty. Ltd. v. CLS Bank Int 'l, 134 S. Ct.
2347, 2354 (2014).
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 (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 Corp., 134 S. Ct.
§ 103 (a). Thus, we treat the listing of claim 15 under the former rejection as
a typographical mistake.
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at 2355. The first step in that analysis is to "determine whether the claims at
issue are directed to one of those patent-ineligible concepts." Id. If the
claims are not directed to a patent-ineligible concept, e.g., an abstract idea,
the inquiry ends. Otherwise, the inquiry proceeds to the second step where
the elements of the claims are considered "individually and 'as an ordered
combination'" to determine whether there are additional elements that
"'transform the nature of the claim' into a patent-eligible application." Id.
(quoting Mayo, 566 U.S. at 79, 78).
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. Therefore, the Federal Circuit has
instructed that claims are to be considered in their entirety to determine
"whether their character as a whole is directed to excluded subject matter."
McRO, Inc. v. Bandai Namco Games Am. Inc., 837 F.3d 1299, 1312
(Fed. Cir. 2016) (quoting Internet Patents Corp. v. Active Network, Inc.,
790 F.3d 1343, 1346 (Fed. Cir. 2015)).
To perform this test, we must first determine whether the claims at
issue are directed to a patent-ineligible concept. The Federal Circuit has
explained that "the 'directed to' inquiry applies a stage-one filter to claims,
considered in light of the specification, based on whether 'their character as
a whole is directed to excluded subject matter."' See Enfish, LLC v.
Microsoft Corp., 822 F.3d 1327, 1335 (Fed. Cir. 2016) (quoting Internet
Patents Corp., 790 F.3d at 1346). It asks whether the focus of the claims is
on a specific improvement in relevant technology or on a process that itself
qualifies as an "abstract idea" for which computers are invoked merely as a
tool. See id. at 1335-36.
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In so doing we apply a "directed to" two prong test: 1) evaluate
whether the claim recites a judicial exception, and 2) if the claim "appl[ies],
rel[ies] on, or use[s] the judicial exception in a manner that imposes a
meaningful limit on the judicial exception, such that the claim is more than a
drafting effort designed to monopolize the judicial exception." 2019 Revised
Patent Subject Matter Eligibility Guidance, 84 Fed. Reg. 50, USPTO 50-57
(2019) (https://www.govinfo.
gov/content/pkg/FR-2019-01-07/pdf/2018-28282.pdf) ("2019 Guidance").
In rejecting the pending claims under 35 U.S.C. § 101, the Examiner
determined that the claims are directed to "receiving, parsing, sending,
determining, transmitting and proceeding/processing." Answer 10. We
agree because these are mental processes that are concepts performed by the
human mind. That is, we find that the steps:
• receiving transaction information and the authorization request for
the transaction, the transaction information including an account
number of an account of the consumer;
• parsing to determine an identifier that includes an account type
identifier;
• sending a query to an account database, the query including the
account type identifier;
• receiving an account type corresponding to the account number
from the account database;
• determining a level of fraud for the transaction using the account
type and the transaction information;
• determining an authorization result for the transaction based on the
fraud level the transaction;
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• transmitting information about the change to determine whether
the change is accepted;
• receiving a confirmation response indicating that the change is
accepted; and
• processing the changed transaction,
constitute data collection, analysis, and display, which are directed to an
abstract idea. See Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d 1350,
1353 (Fed. Cir. 2016) (holding that "collecting information, analyzing it, and
displaying certain results of the collection and analysis" are "a familiar class
of claims 'directed to' a patent-ineligible concept"); see also In re TL!
Commc 'ns LLC Patent Litig., 823 F.3d 607, 611 (Fed. Cir. 2016);
FairWarning IP, LLC v. Iatric Sys., Inc., 839 F.3d 1089, 1093-94 (Fed.
Cir. 2016).
The Examiner also found, "the claims are directed to processing an
authorization request for a transaction which is considered to be an abstract
idea inasmuch as such activity is considered: fundamental economic
practice." Answer 10. We agree with the Examiner that the claims are also
directed to a "fundamental economic practice" as they also focus on fraud
prevention. The Specification states:
For many merchants, effective fraud rules are an important way
to prevent fraudulent transactions from occurring. However,
certain types of risk can be difficult to detect, particularly when
a transaction relates to a recurring bill. For example, a
consumer may have every intention of paying a phone bill at
the time of entering a contract, only later to renege on the
contract within a few months.
Spec. ,r 3. Claim 1 recites, "an authorization result for the transaction based
on the fraud level, wherein the authorization result includes a change in the
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transaction." Thus, we agree with the Examiner that the claims also recite a
fundamental economic practice because all this evidence shows that claim 1
is directed to a transaction authorization based on a fraud level, which
authorization result includes a change in the transaction. The patent-
ineligible end of the spectrum includes fundamental economic practices.
Alice, 134 S. Ct. at 2357.
Turning to the second prong of the "directed to" test, claim 1 merely
requires a "server computer" ( claim 1) or a "merchant computer" ( claim 19),
which implements a series of steps to carry out the abstraction. The server
computer is only generically described as being "coupled to a database and
may include any hardware, software, other logic, or combination of the
preceding for servicing the requests from one or more client computers."
Spec. ,r 20. Likewise, the merchant computer is only generically described
as "may include any suitable computational apparatus operated by a
merchant." Id. ,r 38. We fail to see how the single recitation of the words
"server computer" ( claim 1 ), or a "merchant computer" ( claim 19), "imposes
a meaningful limit on the judicial exception, such that the claim is more than
a drafting effort designed to monopolize the judicial exception." 2019
Guidance at 53.
Therefore, we find that the claimed transaction authorization based on
a fraud level, which authorization result includes a change in the transaction,
is directed to a judicial exception and, thus, is an "abstract idea" beyond the
scope of§ 101.
Concerning the Alice step two analysis, the Examiner found "[t]he
elements of the instant process, when taken in combination, together do not
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offer substantially more than the sum of the functions of the elements when
each is taken alone." Answer 12.
We tum now to the arguments presented by Appellant.
"Appellant respectfully submits that the Examiner has not met her
burden with respect to establishing non-statutory subject matter under 35
U.S.C. § 101." (Appeal Br. 7).
We disagree with Appellant. To the extent Appellant argues that the
Examiner erred in adequately supporting this determination by not providing
evidence, we are unpersuaded. In this regard, there is no requirement that
Examiners must provide evidentiary support in every case before a
conclusion can be made that a claim is directed to an abstract idea. See, e.g.,
July 2015 Update: Subject Matter Eligibility 1, 1-11 (2014)
https://www.uspto.gov/sites/default/files/documents/ieg-july-2015-
update.pdf to 2014 Interim Guidance on Subject Matter Eligibility, 79 Fed.
Reg. 241, 74618 (2014). 4
All that is required of the US PTO to meet its prima facie burden of
production is that the Examiner set forth the statutory basis of the rejection
and the reference or references relied upon in a sufficiently articulate and
informative manner as to meet the notice requirement of 35 U.S.C. § 132.
As the statute itself instructs, the Examiner must "notify the applicant,"
"stating the reasons for such rejection," "together with such information and
4 See also MPEP § 2106.07(a)(III) (2018) ("The courts consider the
determination of whether a claim is eligible ( which involves identifying
whether an exception such as an abstract idea is being claimed) to be a
question of law. Thus, the court does not require 'evidence' that a claimed
concept is a judicial exception, and generally decides the legal conclusion of
eligibility without resolving any factual issues." (Citations omitted.)).
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references as may be useful in judging of the propriety of continuing the
prosecution of his application." 35 U.S.C. § 132; see also In re Jung, 637
F.3d 1356, 1363 (Fed. Cir. 2011) (declining "to impose a heightened burden
on examiners beyond the notice requirement of§ 132"). I-kre, as we found
above, the Examiner has made these findings as required by the statute. See
Answer 8----12.
Specifically, in rejecting the pending claims under§ 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 and the July 2015 Update:
Subject Matter Eligibility. See id. Specifically, the Examiner notified
Appellant that the claims are broadly directed to
receiving, parsing, sending, determining, transmitting and
proceeding/processing ... [and] to processing an authorization
request for a transaction which is considered to be an abstract
idea inasmuch as such activity is considered: fundamental
economic practice.
Answer 10. Turning to step two, Examiner found "[t]he elements of the
instant process, when taken in combination, together do not offer
substantially more than the sum of the functions of the elements when each
is taken alone." Id. at 12. Therefore, we find that the Examiner met the
notice requirement of§ 132.
Appellant next cites to various excerpts from claim 1 that use the
terms, "computer" and "engine," and argues, "Appellant[] disagree[s], and
submit[ s] that a number of claim limitations do not correspond to the alleged
abstract idea, and therefore should qualify as additional limitations."
Appeal Br. 10.
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We disagree with Appellant because the recitation of generically
named devices to implement functions that we identify above as being
abstract, nevertheless causes the functions in of themselves still to remain
abstractions, e.g. "determining ... a level of fraud for the transaction using
the account type and the transaction information." "When claims like the
Asserted Claims are directed to an abstract idea and merely requir[ e] generic
computer implementation, they do[ ] not move into section 101 eligibility
territory." Smart Sys. Innovations, LLC v. Chicago Transit Authority, 873
F.3d 1364, 1374 (Fed. Cir. 2017) (citations and internal quotations omitted).
Appellant argues "two completely different abstract ideas are alleged
consecutively, and multiple categories of abstract idea are put forth as well.
Thus, it remains unclear what exactly is the alleged abstract idea and
category, and therefore a prima facie case of ineligibility has not been
established." Reply Br. 3 (emphasis omitted).
We disagree with Appellant. That the Examiner made two findings as
to the abstract idea does not constitute error. See Apple, Inc. v. Ameranth,
Inc., 842 F.3d 1229, 1240-41 (Fed. Cir. 2016) ("An abstract idea can
generally be described at different levels of abstraction.
Concerning Appellant's contention that "Examiners are no longer
supposed to rely on non-precedential decisions such as SmartGene and
Cyberfone" (Reply Br. 4), we note that the November 2, 2016 Memorandum
does not expressly prohibit reliance on non-precedential decisions, but on
page 4 only states, "examiners should avoid" "relying upon or citing" them.
See Robert W. Bahr, Recent Subject Matter Eligibility Decisions, USPTO 1-
4 (2016), https ://www. uspto. gov/ sites/ default/files/ documents/McRo-
Bascom-Memo. pdf. Moreover our Decision above (page 7, supra) cites to
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the precedential decision of Elec. Power Grp. in support of data collection,
analysis, and display are directed to an abstract idea.
We further disagree with Appellant's contention that the Examiner's
findings of the ordered combination being ineligible are based on "additional
limitations in isolation." Reply Br. 5. This is because the Examiner has
made specific findings based on the description of each of the device terms
as described by the Specification, i.e.:
both the client computer and merchant computers may be any
suitable computational apparatus (paragraph 21 of
[S]pecification); communications network may be any suitable
wired or wireless network (see paragraph 21 of [S]pecification);
and server computer is a computer (i.e. mainframe, see
paragraph 20 of [S]pecification).
Finally, some components can be implemented as a system,
which may be a single computer (see paragraph 22 of
[S]pecification).
Answer 11. Here, the Examiner found that the Specification only evidences
the routine nature of the system components and correspondingly the claims
reflect the same. Accordingly, we find no error with the Examiner's
findings here.
Appellant further argues, "just because a claim can be performed by a
generic computer, it does not automatically follow that the claim cannot
include significantly more." Appeal Br. 14. "Appellant points to Enfzsh,
which stated 'we are not persuaded that the invention's ability to run on a
general-purpose computer dooms the claims."' Id. at 15.
Considered as an ordered combination, the computer components of
Appellant's claims add nothing that is not already present when the steps are
considered separately. The sequence of data reception-analysis-access-
transmitting is equally generic and conventional or otherwise held to be
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abstract. See Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 715 (Fed.
Cir. 2014) (sequence of receiving, selecting, offering for exchange, display,
allowing access, and receiving payment recited an abstraction); Inventor
Holdings, LLC v. Bed Bath & Beyond, Inc., 876 F.3d 1372, 1378 (Fed.
Cir. 2017) ( sequence of data retrieval, analysis, modification, generation,
display, and transmission); Two-Way Media Ltd. v. Comcast Cable
Commc 'ns, LLC, 874 F.3d 1329, 1339 (Fed. Cir. 2017) (sequence of
processing, routing, controlling, and monitoring). Therefore, we agree with
the Examiner that the ordering of the steps is ordinary and conventional.
We further disagree with Appellant that the claims on appeal are like
those found to eligible in Bascom Global Internet Servs. v. AT&T Mobility
LLC, 827 F.3d 1341 (Fed. Cir. 2016). Reply Br. 5---6. This is because in
Bascom:
The inventive concept described and claimed in the '606 patent
is the installation of a filtering tool at a specific location, remote
from the end-users, with customizable filtering features specific
to each end user. This design gives the filtering tool both the
benefits of a filter on a local computer and the benefits of a
filter on the ISP server.
Bascom, 827 F.3d 1350. This inventive concept inures to the improvement
in the technical filed of internet technology. In contrast, there is no technical
field improvement addressed by the inventive concept here, rather only the
deterrence of fraud which is an abstraction.
35 U.S.C. § 102(a)(l) REJECTION
Each of independent claims 1, 18, and 19 recites in one form or
another,
[t]ransmitting, by the server computer, information about the
change to the merchant computer via the communications
network, as well as instructions to the merchant computer to
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communicate with the client computer to determine whether the
change is accepted by the client computer.
The Examiner found concerning this limitation that Elston discloses it
at paragraph 272. Final Act. 11; Answer 4.
Appellant argues,
that providing identification during a purchase is not a "change
in the transaction," as nothing in the transaction changes during
identity verification. Secondly, Elston does not even describe
this type of identity verification. Instead, as described in Elston
paragraphs [0273]-[0277], the security rules are for purchase
limits, removing stored account information for deactivated
accounts, etc.
Appeal Br. 22.
We agree with Appellant, because our review of Elston at
paragraph 272 reveals that at best, Elston generally discloses dynamically
updating security rules stating:
To enforce limits on accounts the security manager sets and
dynamically updates security rules used by the transaction
manager (10), the customer access gateway ( 42), the terminal
communications system ( 44) and the merchant terminal
equipment (50).
Elston at paragraph 277 discloses:
Profiles accounts and deactivates or "puts on watch" bad or
questionable accounts. On watch accounts are not cached to
terminal and removed from terminal cache and may only be
processed on line.
It is not apparent, and the Examiner has not explained how such
updating of rules and/or watch listing or deactivating an account equates to
transmitting, by the server computer, information about the change to the
merchant computer via the communications network, as well as instructions
to the merchant computer to communicate with the client computer to
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determine whether the change is accepted by the client computer. "A claim
is anticipated only if each and every element as set forth in the claim is
found, either expressly or inherently described, in a single prior art
reference." Verdegaal Bros., Inc. v. Union Oil Co. of California, 814 F.2d
628,631 (Fed. Cir. 1987), cert. denied, 484 U.S. 827 (1987). Therefore, we
will not sustain the anticipation rejection of independent claims 1, 18,
and 19. Since claims 2, 4, 7, 8, 10-12, 16, 17, and 22-24 depend from
claim 1, and claim 21 depends from claim 18, since we cannot sustain the
rejection of claims 1 and 19, the rejection of these dependent claims,
likewise, cannot be sustained.
We, likewise, do not sustain the obvious rejection of claim 15 as the
rejection based on Elston and Bhinder does not remedy the deficiency set
forth above.
CONCLUSIONS OF LAW
We conclude the Examiner did not err in rejecting claims 1, 2, 4, 7, 8,
10-12, 15-19, and 21-24 under 35 U.S.C. § 101.
We conclude the Examiner erred in rejecting claims 1, 2, 4, 7, 8, 10-
12, 16-19, and 21-24 under 35 U.S.C. § 102(a)(l).
We conclude the Examiner erred in rejecting claim 15 under
35 U.S.C. § 103.
DECISION
The decision of the Examiner to reject claims 1, 2, 4, 7, 8, 10-12, 15-
19, and 22-24 is affirmed.
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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)(l )(iv).
AFFIRMED
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