Rajesh G. Shakkarwar

Patent Trials and Appeals Board

Aug 23, 2019

13651219 - (D) (P.T.A.B. Aug. 23, 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.
13/651,219 10/12/2012 Rajesh G. Shakkarwar VERI/0017USP1 7524
107456 7590 08/23/2019
Artegis Law Group, LLP
John Carey
7710 Cherry Park Drive Suite T #104
Houston, TX 77095
EXAMINER
MAGUIRE, LINDSAY M
ART UNIT PAPER NUMBER
3693
NOTIFICATION DATE DELIVERY MODE
08/23/2019 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):
algdocketing@artegislaw.com
jmatthews@artegislaw.com
kcruz@artegislaw.com
PTOL-90A (Rev. 04/07)

UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________

Ex parte RAJESH G. SHAKKARWAR
__________

Appeal 2018-0037451
Application 13/651,2192
Technology Center 3600
____________

Before HUBERT C. LORIN, MICHAEL W. KIM, and
BRADLEY B. BAYAT, Administrative Patent Judges.

BAYAT, Administrative Patent Judge.

DECISION ON APPEAL

Appellant appeals under 35 U.S.C. § 134(a) from the Examiner’s final
rejection of claims 9–13, 23–27, and 29–32, which are the only claims
pending in the Application, under 35 U.S.C. § 101 as being directed to a
judicial exception without significantly more. We have jurisdiction under 35
U.S.C. § 6(b).
We REVERSE.

1 Our Decision references Appellant’s Appeal Brief (“Appeal Br.,” filed Oct.
30, 2017) and Reply Brief (“Reply Br.,” filed Feb. 22, 2018), the Examiner’s
Answer (“Ans.,” mailed Dec. 22, 2017), and the Final Office Action (“Final
Act.,” mailed Mar. 23, 2017).
2 Appellant identifies “Verient, Inc.” as the real party in interest. Appeal Br.
3.
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CLAIMED INVENTION
Sole independent claim 9, reproduced below with added bracketed
matter, is representative of the subject matter on appeal.
9. A method of transmitting a financial product data from a NFC
enabled device to a reader device for a payment transaction,
comprising:
[(a)] receiving, at the NFC enabled device, the financial
product data;
[(b)] storing the financial product data in a first storage
device of the NFC enabled device, wherein the first storage
device is not activatable and not accessible by the reader device;
[(c)] during the payment transaction, transmitting the
financial product data from the first storage device to a second
storage device of the NFC enabled device, wherein the second
storage device is activatable and accessible by the reader device;
[(d)] transmitting the financial product data from the
second storage device to the reader device; and
[(e)] removing the financial product data from the
second storage device after transmission to the reader device.
Appeal Br. 20, Claims Appendix.

ANALYSIS
Principals of Law
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. v. CLS Bank Int’l, 573 U.S. 208,
216 (2014).
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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 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. Kappos, 130 S. Ct. 3218, 3231 (2010) (“Claims 1
and 4 in petitioners’ application explain the basic concept of hedging, or
protecting against risk.”). 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 (quotation marks
omitted).
USPTO § 101 Guidance
The USPTO recently published revised guidance on the application of
§ 101. USPTO’s 2019 Revised Patent Subject Matter Eligibility Guidance,
84 Fed. Reg. 50 (Jan. 7, 2019) (“Guidance”). Under Step 2A, Prong One of
the Guidance, we determine if the claim recites a judicial exception,
including particular groupings of abstract ideas (i.e., mathematical concepts,
certain methods of organizing human activity, or mental processes). Id. at
52–53. If so, we then analyze the claim to determine whether the recited
judicial exception is integrated into a practical application of that exception
under Step 2A, Prong Two of the Guidance. Id. at 53–55; MPEP
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§§ 2106.05(a)–(c), (e)–(h) (9th ed. Rev. 08.2017, Jan. 2018). Only if the
claim fails to integrate the exception and thus is “directed to” the judicial
exception, do we then look to whether the claim adds a specific limitation
beyond the judicial exception that is not well-understood, routine, and
conventional activity in the field or whether the claim simply appends well-
understood, routine, and conventional activities previously known to the
industry, specified at a high level of generality, to the judicial exception.
Guidance, 84 Fed. Reg. at 56.
Alice Step 1
Does claim 9 recite a judicial exception?
Under the first step of the Alice inquiry, the Examiner determined “the
claims are directed towards an information managing scheme for financial
product data. Managing financial product data is a method of organizing
human activity and/or a fundamental economic practice and thus, the claims
include an abstract idea.” Final Act. 3.
Appellant does not dispute the Examiner’s characterization of the
abstract idea.
In that regard, where we reproduce claim 9, we identify in italics the
limitations we believe recite an abstract idea, and the one that is consistent
with the Examiner’s and Appellant’s understanding. The recited italicized
limitations, i.e., “receiving,” “storing,” “transmitting,” and “removing”
“financial product data,” individually and collectively, describe not only
mental processes but, as a general matter, the collection and communication
of financial product data, which is a fundamental economic practice in the
exchange of goods and services. Thus, this case implicates subject matter
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groupings (b) “Certain methods of organizing human activity” and (c)
“Mental processes” under Prong One of Step 2A of the Guidance. See
Guidance, 84 Fed. Reg. at 52.

Is claim 9 “directed to” the recited judicial exception?
Appellant argues that claim 9 is not directed to an abstract idea.
Appeal Br. 9.
Under the Guidance’s Step 2A, Prong Two, we now determine
whether there are additional elements that integrate the judicial exception
into a practical application. Guidance, 84 Fed. Reg. at 51; see also MPEP
2106.05(a)–(c), (e)–(h). A claim may integrate the judicial exception when,
for example, it reflects an improvement to technology or a technical field.
Id. at 55.
To the end, Appellant contends that “under Enfish, the claimed
approach improves computer capabilities, as opposed to simply invoking a
computer as a tool.” Appeal Br. 10. In particular, Appellant argues
the claimed approach enables a near field communication (NFC)
enabled device to store and transmit data to a reader device in a
more secured manner relative to prior approaches. In that regard,
the NFC enabled device stores financial product data in a first
storage device that cannot be activated by (i.e., is not activatable
by), and is not accessible by, the reader device. During a
subsequent payment transaction, the financial product data is
transmitted from the first storage device to a second storage
device of the NFC enabled device, the second storage device
being activatable and accessible by the reader device. The
financial product data is then transmitted from the second storage
device to the reader device and the financial product data is
removed from the second storage device after transmission to the
reader device.
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Typically, an NFC enabled device stores data only on a
single storage device that is activatable and accessible by a reader
device. The stored data is read by the reader device when the
NFC enabled device is placed in close proximity to the reader
using near field communication. Electromagnetic energy
emitted from the reader causes the storage device to power on
and then automatically transmit the stored data to the reader.
Because the data is automatically transmitted, an attacker may
illicitly obtain the stored data from the NFC enabled device using
an unauthorized reader (referred to as "eavesdropping").
Appeal Br. 10–11 (citing Spec. ¶¶ 3–5, 25, 26, 69); see also Reply Br. 3–4
(asserting the same).
In response to Appellant’s argument, the Examiner summarily
concludes that “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” (Ans. 3) without looking to the Specification.
We look to the background of the Specification to assess the problems
recognized and solution advanced by the Appellant, because “[t]he
‘abstract idea’ step of the inquiry calls upon us to look at the ‘focus of the
claimed advance over the prior art’ to determine if the claim’s ‘character as a
whole’ is directed to excluded subject matter.” Affinity Labs of Tex. v.
DirecTV, 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)); see
also Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1335 (Fed. Cir. 2016).
According to the Specification:
Personal data is stored on the NFC chip embedded in the
mobile device. The stored data may be read by a reader when
the mobile device is placed in close proximity to the reader.
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Electromagnetic energy emitted from the reader may power on
and automatically transmit the stored data to the reader.
A potential problem exists with near field communications
due to eavesdropping. Because the stored data is automatically
transmitted, an attacker may obtain the stored data from the NFC
chip using an unauthorized reader. There is, therefore, a need for
apparatus and methods of preventing eavesdropping of data from
the NFC chip.
Theft of credit/debit/prepaid card numbers from merchant
repository is a problem in the industry. It would be desirable to
allow customers to pay for goods and services to merchants
without exposing their card number to the merchant. There is a
need therefore, for apparatus and methods of making financial
transactions without exposing the real card number.
Spec. ¶¶ 6–8. “[I]n prior art approaches, an NFC enabled device stored data
only on a single storage device that is activatable and accessible by a reader
device, thereby causing the stored data to be easily obtained by any
unauthorized reader that is within range of the NFC enabled device.”
Appeal Br. 11. With reference to the Specification, Appellant asserts that
this problem was solved by including a first storage device into the payment
device’s NFC tag that is not accessible by a NFC reader device, and a
second storage device that is accessible by the reader device. Spec. ¶ 25.
Prior to a transaction, financial data is transmitted from the first storage
device to the second storage device so that financial data is available and
accessible to conduct the transaction. Id. After transmission of the data to
the reader device, the financial data is removed from the second storage
device and unavailable for eavesdropping by an unauthorized reader device.
Id. The financial data remains securely stored in the first storage device and
available for future use. Id.
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We are persuaded that the focus of the claimed advance over the prior
art is not to simply manage a financial transaction, as asserted in the Final
Office Action and Answer, but rather, to enable devices to store and transmit
data more securely, thereby improving the functionality of those devices, as
indicated in the Specification and reflected in the claims. There is a
fundamental difference between computer functionality improvements, on
the one hand, and uses of existing computers as tools to perform a particular
task, on the other. The Federal Circuit applied this distinction in Enfish in
rejecting a § 101 challenge at the step one stage in the Alice analysis because
the claims at issue focused not on asserted advances in uses to which
existing computer capabilities could be put, but on a specific type of data
structure, i.e., a self-referential table for a computer database, designed to
improve the way a computer carries out its basic functions of storing and
retrieving data. 822 F.3d at 1335–36. Like Enfish, we are persuaded that
Appellant has shown adequately that claim 9 recites an improvement in the
way NFC enabled devices securely store and transmit data, which is an
improvement in computer capabilities and function. We agree with
Appellant that “the claims focus on a technique to achieve the useful result
of securely storing and transmitting financial product data using near field
communication.” Appeal Br. 13. Claim 9 “achieve[s] this result by securely
storing, on the NFC enabled device, the financial product data in a first
storage device that is not activatable and not accessible by the reader
device.” Id. We find that claim 9 is not directed to an abstract idea, but
rather, to a specific improvement to the way NFC enabled devices operate.
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Accordingly, we conclude the claimed invention is integrated into a
practical application, and claim 9 has not been shown to be patent-ineligible
because it is not “directed to” a judicial exception. Under Alice’s
framework, if a claim is not “directed to” a judicial exception, the inquiry
ends. Therefore, we do not sustain the rejection under 35 U.S.C. § 101.

DECISION
The Examiner’s rejection under 35 U.S.C. § 101 is reversed.

REVERSED