Justin N. Smith et al.

Patent Trials and Appeals Board

Sep 3, 2019

14578535 - (D) (P.T.A.B. Sep. 3, 2019)

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.
14/578,535 12/22/2014 Justin N. Smith AU140211USNP 4695
57572 7590 09/03/2019
MARK NOWOTARSKI
30 Old Kings Highway South
Darien, CT 06820
EXAMINER
FRENEL, VANEL
ART UNIT PAPER NUMBER
3687
NOTIFICATION DATE DELIVERY MODE
09/03/2019 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):
MNOWOTARSKI@MARKETSANDPATENTS.COM
mark.nowotarski@gmail.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________

Ex parte JUSTIN N. SMITH, SEAN HUGHES, and
JAMES SHASTA DAULTON
____________

Appeal 2018-0035121
Application 14/578,535
Technology Center 3600
____________

Before JOSEPH A. FISCHETTI, MICHAEL C. ASTORINO, and
PHILIP J. HOFFMANN, Administrative Patent Judges.

FISCHETTI, Administrative Patent Judge.

DECISION ON APPEAL

STATEMENT OF THE CASE
Appellants seek our review under 35 U.S.C. § 134 of the Examiner’s
final rejection of claims 1 and 5–9. We have jurisdiction under 35 U.S.C.
§ 6(b).

SUMMARY OF DECISION
We AFFIRM.

1 Appellants identify Applied Underwriters, Inc., a subsidiary of Berkshire
Hathaway Inc., as the real party in interest. (App. Br. 2.)
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THE INVENTION
Appellants state their invention covers “[a] computer-based prediction
system for forecasting the level of risk an employee faces from a terrorist
event [which] combines information about where an employee is during a
work period versus the amplitudes and radii of terrorist risks the employee
may come near.” (Spec. Abstr.)
Claim 1, reproduced below, is representative of the subject matter on
appeal.
1. A computer-based system comprising:
a) a location sensing device moving in conjunction with
an employee;
b) a microprocessor;
c) an output device; and
d) a permanent memory comprising computer readable
instructions to physically cause said microprocessor to carry out
the steps of:
i) read in employee location distribution data from
said location sensing device, said location distribution
data comprising:
1) a first location and a first amount of time
spent by said employee at said first location; and
2) a second location and a second amount of
time spent by said employee at said second
location;
ii) read in terror risk distribution data suitable for
calculating a probability of terror attack of a given
threshold of severity for one or more of said employee
locations, said terror risk distribution data comprising:
1) a location of terror risk;
2) an amplitude of terror risk; and
3) a radius of terror risk;
iii) calculate a level of risk said employee faces
from a terrorist event, said calculation being based on
said employee location distribution data and said terror
risk distribution data; and
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iv) output said calculated level of risk said
employee faces from a terrorist event via said output
device.

THE REJECTION
The following rejection is before us for review:
Claims 1 and 5–9 are rejected under 35 U.S.C. § 101 because the
claimed invention is directed to non-statutory subject matter as the claimed
invention is directed to a judicial exception (i.e., an abstract idea) without
significantly more.

FINDINGS OF FACT
We adopt the Examiner’s findings as set forth on pages 2–8 in the
Final Office Action2 and on pages 3–11 in the Examiner’s Answer,
concerning the 35 U.S.C. § 101 rejection.

ANALYSIS
35 U.S.C. § 101 REJECTION
We will affirm the rejection of claims 1 and 5–9 under 35 U.S.C.
§ 101.
The Appellants argue3, and we select claim 1 as the representative
claim for this group (App. Br. 11–13), and so the remaining claims stand or
fall with claim 1. See 37 C.F.R. § 41.37(c)(1)(iv) (2015).

2 All references to the Final Office Action refer to the Final Office Action
mailed on December 15, 2016.
3 Although Appellants state that “[e]ach claim will be argued separately”
(Appeal Br. 7), Appellants on page 9 of the Appeal Brief merely recite the
claim limitations of claims 5–9 adding only a general statement about that
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Arguments which Appellants could have made but chose not to make
in the Briefs have not been considered and are deemed to be waived. See 37
C.F.R. § 41.37(c)(1)(iv) (2015). Except as will be noted in this opinion,
Appellants have not presented any substantive arguments directed separately
to the patentability of the dependent claims. In the absence of a separate
argument with respect to those claims, they stand or fall with the
representative independent claim. See In re Young, 927 F.2d 588, 590 (Fed.
Cir. 1991). See also 37 C.F.R. § 41.37(c)(1)(iv) (2015).
An invention is patent-eligible if it claims a “new and useful process,
machine, manufacture, or composition of matter.” 35 U.S.C. § 101.
However, the Supreme Court has long interpreted 35 U.S.C. § 101 to include
implicit exceptions: “[l]aws of nature, natural phenomena, and abstract
ideas” are not patentable. E.g., Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 573
U.S. 208, 216 (2014) (internal quotation marks and citation omitted).
In determining whether a claim falls within an excluded category, we
are guided by the Supreme Court’s two-step framework, described in Mayo
and Alice. Id. at 217–18 (citing Mayo Collaborative Servs. v. Prometheus
Labs., Inc., 566 U.S. 66, 75–77 (2012)). In accordance with that framework,
we first determine what concept the claim is “directed to.” See id. 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. Kappos, 561 U.S. 593, 611 (2010) (“Claims 1 and 4

language being an improvement without substantive argument. A statement
which merely points out what a claim recites will not be considered an
argument for separate patentability of the claim. See 37 C.F.R. § 41.37
(c)(1)(iv) (2015).

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in petitioners’ application explain the basic concept of hedging, or protecting
against risk.”).
Concepts determined to be abstract ideas, and thus patent ineligible,
include 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 formulas (Parker v. Flook, 437 U.S. 584, 594–95 (1978)); and
mental processes (Gottschalk v. Benson, 409 U.S. 63, 67 (1972)). Concepts
determined to be patent eligible include physical and chemical processes,
such as “molding rubber products” (Diamond v. Diehr, 450 U.S. 175, 191
(1981)); “tanning, dyeing, making water-proof cloth, vulcanizing India
rubber, smelting ores” (id. at 182 n.7 (quoting Corning v. Burden, 56 U.S.
252, 267–68 (1854))); and manufacturing flour (Benson, 409 U.S. at 69
(citing Cochrane v. Deener, 94 U.S. 780, 785 (1876))).
In Diehr, the claim at issue recited a mathematical formula, but the
Supreme Court held that “[a] claim drawn to subject matter otherwise
statutory does not become nonstatutory simply because it uses a
mathematical formula.” Diehr, 450 U.S. at 187; see also id. at 191 (“We
view respondents’ claims as nothing more than a process for molding rubber
products and not as an attempt to patent a mathematical formula.”). Having
said that, the Supreme Court also indicated that a claim “seeking patent
protection for that formula in the abstract . . . is not accorded the protection
of our patent laws, . . . and this principle cannot be circumvented by
attempting to limit the use of the formula to a particular technological
environment.” Id. (citing Benson and Flook); see, e.g., Diehr, 450 U.S.
at 187 (“It is now commonplace that an application of a law of nature or
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mathematical formula to a known structure or process may well be deserving
of patent protection.”).
If the claim is “directed to” an abstract idea, we turn to the second
step of the Alice and Mayo framework, where “we must examine the
elements of the claim to determine whether it contains an ‘inventive
concept’ sufficient to ‘transform’ the claimed abstract idea into a
patent-eligible application.” Alice, 573 U.S. at 221 (internal citation
omitted). “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].’” Id. (alterations in original) (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 PTO recently published revised guidance on the application of
§ 101. 2019 REVISED PATENT SUBJECT MATTER ELIGIBILITY GUIDANCE, 84
Fed. Reg. 50 (Jan. 7, 2019) (“Guidance”). Under the 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 activity such as a fundamental economic
practice, or mental processes); and
(2) additional elements that integrate the judicial exception into
a practical application (see MANUAL OF PATENT EXAMINING
PROCEDURE (“MPEP”) § 2106.05(a)–(c), (e)–(h) (9th ed., Rev.
08.2017, Jan. 2018)).
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 § 2106.05(d)); or
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(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 Guidance, 84 Fed Reg. at 56.
The U.S. Court of Appeals for the Federal Circuit has explained that
“the ‘directed to’ inquiry applies a stage-one filter to claims, considered in
light of the [S]pecification, based on whether ‘their character as a whole is
directed to excluded subject matter.’” Enfish, LLC v. Microsoft Corp.,
822 F.3d 1327, 1335 (Fed. Cir. 2016) (quoting Internet Patents Corp. v.
Active Network, Inc., 790 F.3d 1343, 1346 (Fed. Cir. 2015)). 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.
In so doing, as indicated above, we apply a “directed to” two prong
test: 1) evaluate whether the claim recites a judicial exception, and 2) if the
claim recites a judicial exception, evaluate whether 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.” Guidance, 84
Fed. Reg. at 53; see also MPEP § 2106.05(a)–(c), (e)–(h).
The Specification states:
Terrorist risks are difficult to predict. There
is very little data available on actual attacks. Thus,
most of the work in this area has involved the
creation of so-called “Delphic” models, which are
produced by creating a group of acknowledged
experts on terrorism and having them produce a
“catalog” of likely attacks, including details as to
method, location, intensity, and timing. Several
such inventories have been produced by specialist
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catastrophe risk modeling firms and are in use. Most
of the details are not in the public domain, but
certain included locations and events are known, as
is the overall size of a typical catalog, which
includes about 250,000 possible events. Employers
have used these catalogs to estimate the level of
terror an employee faces by looking at the terror risk
of said employee’s address of employment.
Unfortunately, this method does not take into
account the risks employees face when they work
away from their formal address of employment.
Thus there is a need for a computer-based prediction
system for forecasting the level of risk an employee
faces that takes into account the location
distribution of said employee in the course of said
employee’s work.
(Spec. 2:15–27.)
Understood in light of the Specification, claim 1 recites, in pertinent
part:
i) read in employee location distribution data . . . , said
location distribution data comprising:
1) a first location and a first amount of time spent
by said employee at said first location; and
2) a second location and a second amount of time
spent by said employee at said second location;
ii) read in terror risk distribution data suitable for
calculating a probability of terror attack of a given threshold of
severity for one or more of said employee locations, said terror
risk distribution data comprising:
1) a location of terror risk;
2) an amplitude of terror risk; and
3) a radius of terror risk;
iii) calculate a level of risk said employee faces from a
terrorist event, said calculation being based on said employee
location distribution data and said terror risk distribution data;
and
iv) output said calculated level of risk said employee faces
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from a terrorist event via said output device.
Accordingly, the Examiner found that the claims “are directed to a
mathematical relationship/formula, such as predicting and calculating a
risk.” (Final Act. 2.)
We agree with the Examiner that claim 1 is directed to at least a
mathematical relationship/formula because the claim recites “calculat[ing] a
level of risk said employee faces from a terrorist event, said calculation
being based on said employee location distribution data and said terror risk
distribution data.”4 Mathematical relationships/formulas are patent-
ineligible. Guidance, 84 Fed. Reg. at 52, citing Diehr 450 U.S. 191.
We further find that claim 1 is directed to an evaluation because
claim 1 recites, “calculate a level of risk said employee faces from a terrorist
event, said calculation being based on said employee location distribution
data and said terror risk distribution data.” Evaluation is a form of a mental
process which is patent ineligible. Guidance, 84 Fed. Reg. at 52, citing
Mayo, 566 U.S. at 71.
Turning to the second prong of the “directed to” test, claim 1 only
generically requires “a) a location sensing device,” “b) a microprocessor,”
“c) an output device,” and “d) a permanent memory.” These components
are described in the Specification at a high level of generality. (See
Spec. 7:8–18, Fig. 1.) We fail to see how the generic recitations of these
most basic computer components and/or of a system so integrates the
judicial exception as to “impose[] a meaningful limit on the judicial

4 “The Appellant[s] accept[] that the combined limitations of claim l(d)(ii)
and claim l(d)(iii) in their broadest reasonable interpretation recite a
mathematical relationship/formula.” (Reply Br. 9).
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exception, such that the claim is more than a drafting effort designed to
monopolize the judicial exception.” Guidance, 84 Fed. Reg. at 53.
Thus, we find that the claims recite the judicial exception of a mental
process that is not integrated into a practical application.
That the claims do not preempt all forms of the abstraction or may be
limited to terrorism risk evaluation, does not make them any less abstract.
See OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1362–63 (Fed.
Cir. 2015) (“And that the claims do not preempt all price optimization or
may be limited to price optimization in the e-commerce setting do not make
them any less abstract.”).
Turning to the second step of the Alice analysis, because we find that
the claims are directed to abstract ideas/judicial exceptions, the claims must
include an “inventive concept” in order to be patent-eligible, i.e., there must
be an element or combination of elements sufficient to ensure that the claim
in practice amounts to significantly more than the abstract idea itself. See
Alice, 573 U.S. at 217–18 (quoting Mayo Collaborative Servs., 566 U.S.
at 72–73).
Concerning this step the Examiner found the following:

The claim(s) does/do not include additional
elements that are sufficient to amount to
significantly more than the abstract idea because the
generically-recited computer elements (e.g.[,] a
computer, a sensing device, a microprocessor and
an output device) do not add a meaningful limitation
to the idea because the actions, functions, and/or
steps performed by the generically-recited
computer elements would be routine and
conventional in any computer implementations.
Because the courts have declined to define “abstract
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idea,” other than by example, examiners have been
instructed to refer to the body of case law precedent
in order to identify abstract ideas by way of
comparison to concepts already found to be
abstract.
(Final Act. 2–3.)
We agree with the Examiner. “[T]he relevant question is whether the
claims here do more than simply instruct the practitioner to implement the
abstract idea . . . on a generic computer.” Alice, 573 U.S. at 225. They do
not.
Taking the claim elements separately, the function performed by the
computer at each step of the process is purely conventional. Using a
computer to read, calculate, output data, generate a result, and transmit and
update same amounts to electronic data query and transmit same are some of
the most basic functions of a computer. All of these computer functions are
well-understood, routine, conventional activities previously known to the
industry. See Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d 1350, 1354
(Fed. Cir. 2016); see also In re Katz, 639 F.3d 1303, 1316 (Fed. Cir. 2011)
(“Absent a possible narrower construction of the terms ‘processing,’
‘receiving,’ and ‘storing,’ . . . those functions can be achieved by any
general purpose computer without special programming”). In short, each
step does no more than require a generic computer to perform generic
computer functions.
Considered as an ordered combination, the computer components of
Appellants’ claims add nothing that is not already present when the steps are
considered separately. The sequence of data reception-analysis (read,
calculate, output data, generate a result) and storing is equally generic and
conventional or otherwise held to be abstract. See Ultramercial, Inc. v.
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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) (holding that sequence
of data retrieval, analysis, modification, generation, display, and
transmission was abstract), Two-Way Media Ltd. v. Comcast Cable
Commc’ns, LLC, 874 F.3d 1329, 1339 (Fed. Cir. 2017) (holding sequence of
processing, routing, controlling, and monitoring was abstract). The ordering
of the steps is, therefore, ordinary and conventional.
Thus, the claims at issue amount to nothing significantly more than
instructions to apply the abstract ideas of a mathematical relationship and/or
a mental process using some unspecified, generic computer. Under our
precedents, that is not enough to transform an abstract idea into a patent-
eligible invention. See Alice, 573 U.S. at 225–26.
We have reviewed all the arguments Appellants have submitted
concerning the patent eligibility of the claims before us that stand rejected
under 35 U.S.C. § 101. (App. Br. 7–13, Reply Br. 1–16.) We find that our
analysis above substantially covers the substance of all the arguments, which
have been made. But, for purposes of completeness, we will address various
arguments in order to make individual rebuttals of same.
First, Appellants’ arguments, including those directed to now-
superseded USPTO guidance (App. Br. 10, Reply Br. 7–9), have been
considered but are not persuasive of error. See Guidance, 84 Fed. Reg. at 51
(“Eligibility-related guidance issued prior to the Ninth Edition, R–08.2017,
of the MPEP (published Jan. 2018) should not be relied upon.”).
Appellants argue,
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[c]laim 1 is directed to the concept of “a new and
useful technique for using a location sensing device
to more efficiently track an employee’s movements
and calculate the level of risk said employee faces
from a terrorist event”. Thus claim 1 is directed to
more than the general concept of using a
mathematical formula to calculate a risk or the
general concept of calculating a risk an employee
faces from a terrorist event. A location sensing
device moving in conjunction with an employee
must be used. Thus the Examiner has failed to
properly identify a judicial exception.
(App. Br. 11 (emphasis omitted).)
We disagree with Appellants. First, any difference between what the
Examiner describes as constituting “directed to matter” and that proposed by
the Appellants does not constitute error because such characteristics can be
described, at different levels of abstraction, to what the claims are directed,
and it is recognized that “[a]n abstract idea can generally be described at
different levels of abstraction.” Apple, Inc. v. Ameranth, Inc., 842 F.3d
1229, 1240 (Fed. Cir. 2016). Appellants’ depiction of the “directed to”
subject matter includes “using a location sensing device,” but as found
above, this limitation is a mere generic recitation of the most basic computer
components and/or of a system and fails to integrate the judicial exception as
to “impose[] a meaningful limit on the judicial exception, such that the claim
is more than a drafting effort designed to monopolize the judicial
exception.”
Appellants also argue,
Since the Examiner has failed to properly
identify the additional elements of the claims that
go beyond the identified judicial exception, the
Examiner has also failed to provide any reasons
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why said additional elements do not result in the
claim as a whole amounting to significantly more
than the judicial exception. The Examiner has also
failed to provide any reasons why the additional
elements taken as a combination do not result in the
claim as a whole amounting to significantly more
than the judicial exception. Thus the Examiner has
failed to make a prima facie case of nonstatutory
subject matter. The Examiner’s rejection of claim 1
and dependent claims 5 to 9 under 35 U.S.C. [§]
101, therefore, cannot be sustained.
(App. Br. 12.)
We disagree with Appellants. To the extent Appellants argue 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.,
MPEP § 2106.07(a)(III) (“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.” (Internal citations omitted)).
Moreover, the Federal Circuit made clear in Berkheimer that “not
every § 101 determination contains genuine disputes over the underlying
facts material to the § 101 inquiry.” Berkheimer v. HP Inc., 881 F.3d 1360,
1368 (Fed. Cir. 2018). In fact, the Federal Circuit in Berkheimer did not
require evidentiary support for independent claim 1 because “[t]he
limitations [of claim 1] amount to no more than performing the abstract idea
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of parsing and comparing data with conventional computer components.”
Id. at 1370.
All that is required of the USPTO 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
references as may be useful in judging 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”). Here, as we found
above, the Examiner has made these findings as required by the statute. (See
Final Act. 2–4.)
Specifically, in rejecting the pending claims under § 101, the
Examiner notified Appellants that the claims “are directed to a mathematical
relationship/formula, such as predicting and calculating a risk” (Final Act. 2)
and that
[t]he claim(s) does/do not include additional
elements that are sufficient to amount to
significantly more than the abstract idea because the
generically-recited computer elements (e.g.[,] a
computer, a sensing device, a microprocessor and
an output device) do not add a meaningful limitation
to the idea because the actions, functions, and/or
steps performed by the generically-recited
computer elements would be routine and
conventional in any computer implementations.
(Id. at 2–3.) Thus, we find that a prima facie case was established by the
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Examiner.
Finally, we disagree with Appellants that “claim 1 is similar to Diehr
in that a mathematical relationship is used in a process to solve a
technological problem in conventional industry practice.” (Reply Br. 9–10.)
In Diehr, the claim was directed to “the transformation of an article, in this
case raw, uncured synthetic rubber, into a different state or thing.” Diehr,
450 U.S. at 184. Conversely, at best, independent claim 1 before us here
results in the outputting of a calculated risk level, which is not an article but
rather is an abstraction.

CONCLUSIONS OF LAW
We conclude the Examiner did not err in rejecting claims 1 and 5–9
under 35 U.S.C. § 101.

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DECISION
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)(iv).

AFFIRMED