MasterCard International Incorporated

Patent Trials and Appeals Board

Jun 23, 2020

14926397 - (D) (P.T.A.B. Jun. 23, 2020)

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.
14/926,397 10/29/2015 Peter J. Groarke P01921-US-
UTIL (M01.337)
4941
125619 7590 06/23/2020
Mastercard International Incorporated
c/o Buckley, Maschoff & Talwalkar LLC
50 Locust Avenue
New Canaan, CT 06840
EXAMINER
KANERVO, VIRPI H
ART UNIT PAPER NUMBER
3691
NOTIFICATION DATE DELIVERY MODE
06/23/2020 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):
colabella@bmtpatent.com
martin@bmtpatent.com
szpara@bmtpatent.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________

Ex parte PETER J. GROARKE and BRIAN JOHN PIEL
____________

Appeal 2019-002375
Application 14/926,397
Technology Center 3600
____________

Before MURRIEL E. CRAWFORD, NINA L. MEDLOCK, and
TARA L. HUTCHINGS, Administrative Patent Judges.

HUTCHINGS, Administrative Patent Judge.

DECISION ON APPEAL

STATEMENT OF THE CASE
Appellant1 appeals under 35 U.S.C. § 134(a) from the Examiner’s
final rejection of claims 1–13. We have jurisdiction under 35 U.S.C. § 6(b).
We REVERSE.

1 We use the term “Appellant” to refer to “applicant” as defined in 37 C.F.R.
§ 1.42. Our decision references Appellant’s Appeal Brief (“Appeal Br.,”
filed Sept. 18, 2018) and Reply Brief (“Reply Br.,” filed Jan. 23, 2019), and
the Examiner’s Answer (“Ans.,” mailed Nov. 29, 2018) and Final Office
Action (“Final Act.,” mailed May 4, 2018). Appellant identifies
MASTERCARD INTERNATIONAL INCORPORATED as the real party in
interest. Appeal Br. 2.
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CLAIMED INVENTION
Appellant describes that the claimed invention relates generally to
“techniques for conducting secure online purchase transactions” and, more
particularly, to “providing cardholder authentication services on-behalf-of
(OBO) issuers utilizing a payment card authorization network to bridge
cardholder authentication and transaction authorization processes.”
Spec. 1:7–10.
Claims 1 and 9 are the independent claims on appeal. Claim 1,
reproduced below with bracketed notations added, is illustrative of the
claimed subject matter:
1. A method for providing online cardholder authentication
services on-behalf-of issuer financial institutions, comprising:
[(a)] receiving, by an on-behalf-of (OBO) issuer service
computer from one of a merchant server computer or an access
control server (ACS) computer, an authentication message
comprising an authentication value and transaction data;
[(b)] storing, by the OBO issuer service computer, the
authentication message in a transaction database;
[(c)] receiving, by the OBO issuer service computer from a
payment network, a purchase transaction authorization request
message;
[(d)] determining, by the OBO issuer service computer, that
an authentication value in an universal cardholder authentication
field (UCAF) of the purchase transaction authorization request
message matches the authentication value of the stored
authentication message;
[(e)] calculating, by the OBO issuer service computer, a time
difference value between a time and date of an online purchase
transaction stored in the transaction database and the time and date
of the purchase transaction authorization request message;
[(f)] determining, by the OBO issuer service computer, that
the time difference value is within a predetermined time range;
[(g)] storing, by the OBO issuer service computer in the
transaction database, a record of the match; and
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[(h)] transmitting, by the OBO issuer service computer, the
purchase transaction authorization request to the payment network
for purchase authorization processing.

REJECTION2
Claims 1–13 are rejected under 35 U.S.C. § 101 as directed to a
judicial exception without significantly more.

ANALYSIS
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.”
35 U.S.C. § 101. 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. v. CLS Bank Int’l, 573 U.S.
208, 216 (2014).
The Supreme Court, in Alice, reiterated the two-step framework 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., 573 U.S. at 217. 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

2 The Examiner has withdrawn the rejections of claims 1–13 under
35 U.S.C. § 103. Ans. 3.
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of the claim’ into a patent-eligible application.” Id. (quoting Mayo, 566 U.S.
at 79, 78). This is “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.’” Id. at 217–18 (alteration in original).
After Appellant’s briefs were filed, and the Examiner’s Answer
mailed, the U.S. Patent and Trademark Office (the “USPTO”) published
revised guidance on January 7, 2019 for use by USPTO personnel in
evaluating subject matter eligibility under 35 U.S.C. § 101. 2019 REVISED
PATENT SUBJECT MATTER ELIGIBILITY GUIDANCE, 84 Fed. Reg. 50, 57
(Jan. 7, 2019) (the “Revised Guidance”). That guidance revised the
USPTO’s examination procedure with respect to the first step of the
Mayo/Alice framework by (1) “[p]roviding groupings of subject matter that
[are] considered an abstract idea; and (2) clarifying that a claim is not
‘directed to’ a judicial exception if the judicial exception is integrated into a
practical application of that exception.” Id. at 50. The Revised Guidance,
by its terms, “applies to all applications, and to all patents resulting from
applications, filed before, on, or after January 7, 2019.” Id.; see also the
USPTO’s “October 2019 Update: Subject Matter Eligibility,” available at
https://www.uspto.gov/sites/default/files/documents/
peg_oct_2019_update.pdf (clarifying the Revised Guidance in response to
comments solicited from the public) (hereinafter “October 2019 Update”).
The first step in the Mayo/Alice framework, as mentioned above, is to
determine whether the claims at issue are “directed to” a patent-ineligible
concept, e.g., an abstract idea. Alice Corp., 573 U.S. at 217. This first step,
as set forth in the Revised Guidance (i.e., Step 2A), is a two-prong test. In
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Step 2A, Prong One, we look to whether the claim recites a judicial
exception, e.g., one of the following three groupings of abstract ideas:
(1) mathematical concepts; (2) certain methods of organizing human
activity, e.g., fundamental economic principles or practices, commercial or
legal interactions; and (3) mental processes. Revised Guidance, 84 Fed.
Reg. at 52. If so, we next consider whether the claim includes additional
elements, beyond the judicial exception, “that integrate the [judicial]
exception into a practical application,” i.e., that apply, rely on, or use 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 (“Step 2A, Prong Two”). Id. at 54–55.
Only if the claim (1) recites a judicial exception and (2) does not integrate
that exception into a practical application do we conclude that the claim is
“directed to” the judicial exception, e.g., an abstract idea. Id. If the claim is
directed to an abstract idea, we then look to whether the claim “[a]dds a
specific limitation or combination of limitations” that is not “well-
understood, routine, conventional activity in the field” or simply “appends
well-understood, routine, conventional activities previously known to the
industry, specified at a high level of generality, to the judicial exception”
(“Step 2B”). Id. at 56.
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.’” 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
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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 rejecting the pending claims under 35 U.S.C. § 101, the Examiner
determined that steps (a) through (h) as recited in claim 1, and similarly
recited in claim 9,
are directed to the abstract idea of providing online cardholder
authentication services on-behalf-of issuer financial institution
by determining that an authentication value in an universal
cardholder authentication field of the purchase transaction
authorization request message matches the authentication value
of the stored authentication message.
Final Act. 5–6. The Examiner concluded that this concept is similar to the
concept of collecting information, analyzing information, and displaying
certain results of the collection and analysis that the Federal Circuit found to
be abstract. Id. at 6 (citing Elec. Power Grp. LLC v. Alstom, S.A., 830 F.3d
1350 (Fed. Cir. 2016)); see also Ans. 8. The Examiner found that the
additional elements are well-understood, routine, and conventional elements
that amount to no more than implementing the abstract idea. Id. at 7. The
Examiner additionally determined that the additional elements, considered
alone and as an ordered combination, do not amount to significantly more
than the recited abstract idea. Id.
Viewed through the lens of the Revised Guidance, we understand the
Examiner’s characterization of the abstract idea to be a mental process, i.e.,
“concepts performed in the human mind (including an observation,
evaluation, judgment, opinion).” Revised Guidance, 84 Fed. Reg. at 52
(footnotes omitted); see also October 2019 Update 7 (identifying exemplary
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mental processes as including the concept of the claims at issue in Electric
Power Group).
Appellant argues that the Examiner erred in determining that the
claims are directed to an abstract idea, because the claims “solve[] the
technological problem of how to validate an authentication value and insert
the actual value into the authorization message on-behalf-of an issuer FI to
increase the issuer FI’s overall confidence in the online transaction (that it is
not fraudulent).” Appeal Br. 15. Appellant maintains that, like the claims at
issue in BASCOM Global Internet Services, Inc. v. AT&T Mobility LLC,
827 F.3d 1341 (Fed. Cir. 2016), Appellant’s claims recite an inventive
concept in the non-conventional and non-generic arrangement of known
conventional pieces. Id. at 18–19.
Here, the Specification is entitled “PROVIDING ONLINE
CARDHOLDER AUTHENTICATION SERVICES ON-BEHALF-OF
ISSUERS.” The Background section describes that remote or “card-not
present” (“CNP”) transactions increase risk for a merchant, payment card
issuer, and payment card network provider, resulting in increased cardholder
disputes and chargebacks than occur with in-person transactions.
Spec. 1:22–2:2. Several payment card networks have adopted an additional
security layer for online payment card transactions based on a 3-D secure
protocol. Id. at 2:8–11, 2:26–27. Id. at 2:8–11. In particular, an
accountholder authentication value (“AAV”) is generated regarding a result
of authentication and placed into a universal cardholder authentication field
(“UCAF”). Id. at 2:11–15, 26–29, 4:6–8. The merchant adds the AAV to
the UCAF. Id. at 2:26–29 (describing that the merchant’s bank adds the
AAV to the UCAF), 4:16–20 (describing that the merchant server and/or
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merchant acquirer computer adds the AAV to the UCAF). The AAV
conveys the authentication result to the issuer financial institution server. Id.
at 4:19–20. But because the merchant must add the AAV, some issuer FI
servers are set to ignore the AAV due to distrust of the content. Id. at 4:20–
22. The Specification describes that there is a need to provide an
authorization network that carries out the AAV validation on-behalf of
issuer financial institutions in a manner that increases the overall confidence
of the payment account transaction. Id. at 4:29–5:2.
To solve this problem, the present invention describes an improved
authentication process performed on-behalf-of the issuer financial
institutions for CNP transactions. Id. at 6:8–10, 18–20, 21:6–8. An OBO
issuer service computer receives and stores an authentication message,
which has an authentication value and transaction data, from a merchant
server computer. Id. at 21:8–11. Next, the OBO issuer service computer
receives a purchase authorization request message from a payment network.
Id. at 21:12–13. The OBO issuer service computer compares whether the
authentication value in the UCAF of the purchase transaction authorization
request message matches the authentication value of the stored
authentication message. Id. at 21:13–17. In this way, the process validates
the authentication value and the insertion of the authentication value into the
authorization message on-behalf-of the issuer, increasing the overall
confidence of the transaction. Id. at 6:23–25, 7:13–17. As an added layer of
security, the process additionally can check the timeliness of receipt of the
purchase transaction authorization request by comparing the time and date of
its receipt against that associated with the stored authentication message. Id.
at 10:20–11:10.
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Consistent with this disclosure, claim 1 recites a method for providing
online cardholder authentication services on-behalf-of issuer financial
institutions. The steps of the method include: (1) “receiving . . . an
authentication message comprising an authentication value and transaction
data” (step (a)); (2) “storing . . . the authentication message . . . .” (step (b));
(3) “receiving . . . a purchase transaction authorization request message”
(step (c)); (4) “determining . . . that an authentication value in an universal
cardholder authentication field (UCAF) of the purchase transaction
authorization request message matches the authentication value of the stored
authentication message” (step (d)); (5) “calculating . . . a time difference value
between a time and date of an online purchase transaction stored . . . and the
time and date of the purchase transaction authorization request message”
(step (e)); (6) “determining . . . that the time difference value is within a
predetermined time range” (step (f)); (7) “storing . . . a record of the match”
(step (g)); and (8) “transmitting . . . the purchase transaction authorization
request . . . for purchase authorization processing” (step (h)). Independent
claim 9 recites similar subject matter.
We are persuaded by Appellant’s arguments that the Examiner erred
in determining that the claims are directed to an abstract idea. Applying the
Revised Guidance, and putting aside whether the claims recite subject matter
that falls within one of the enumerated groupings of abstract ideas, we are
persuaded that the claims integrate any alleged abstract idea into a practical
application — the claims provide an improvement in a technical field, i.e.,
an improvement in an authentication process for card-not-present
transactions that reduces the risk of an issuer financial institution receiving
altered authentication data. See Revised Guidance, 84 Fed. Reg. at 55; see
also BASCOM, 827 F.3d at 1351 (holding that the claimed invention recites
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a “technology-based solution . . . to filter content on the Internet that
overcomes existing problems with other Internet filtering systems . . .
making it more dynamic and efficient”)). On the present record, Examiner
has not sufficiently explained why the claimed invention considered in light
of the above-reference portions of the Specification would not be considered
an improvement in technology or a technical field.
We conclude that the claims are not directed to a judicial exception
and, thus, are patent eligible. Accordingly, we do not sustain the Examiner’s
rejection of claims 1–13 under 35 U.S.C. § 101.

CONCLUSION
In summary:
Claims
Rejected
35 U.S.C. § Basis Affirmed Reversed
1–13 101 Eligibility 1–13
REVERSED