Singhal, Tara Chand.

Patent Trials and Appeals Board

Mar 23, 2020

12928710 - (D) (P.T.A.B. Mar. 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.
12/928,710 12/17/2010 Tara Chand Singhal 11195.37Div3 5129
103550 7590 03/23/2020
Tara Chand Singhal
P.O. Box 5075
Torrance, CA 90510
EXAMINER
OYEBISI, OJO O
ART UNIT PAPER NUMBER
3697
NOTIFICATION DATE DELIVERY MODE
03/23/2020 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):
chand@internetpromise.com
singhal@att.net
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte TARA CHAND SINGHAL
Appeal 2019-000707
Application 12/928,710
Technology Center 3600
Before ALLEN R. MacDONALD, NABEEL U. KHAN, and
MICHAEL J. ENGLE, Administrative Patent Judges.
KHAN, Administrative Patent Judge.
DECISION ON APPEAL
STATEMENT OF THE CASE
Pursuant to 35 U.S.C. § 134(a), Appellant appeals from the
Examiner’s decision to reject claims 1–20. We have jurisdiction under
35 U.S.C. § 6(b).
We AFFIRM.
CLAIMED SUBJECT MATTER
According to Appellant, the invention relates to “facilitating private
and secure merchant payment at a merchant sales terminal using a wireless
mobile device of the customer.” Spec. 1:23–25.
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Claim 1, reproduced below, is illustrative of the claimed subject
matter:
1. A secure payment system between a customer and a
merchant using a sales terminal of the merchant and a central
system on a global computer network, comprising:
a cellular wireless device of the customer, wherein the
wireless device is equipped with a wireless data receiving sensor,
wherein the wireless data receiving sensor is one or more from a
group of, a digital camera, a short distance RF receiver and an
infrared receiver, the wireless device using the wireless data
receiving sensor is able to receive a partial payment authorization
transaction record from the sales terminal of the merchant;
a logic stored in a memory of the wireless device and
operating in a CPU of the wireless device receives and processes
the partial payment authorization transaction record from the
sales terminal, wherein the partial payment authorization
transaction record meta data includes data fields of only a date
and a time of the sales transaction, a transaction reference
number, a merchant terminal identification and a payment
amount;
the logic in the wireless device processes the partial
payment authorization transaction record by first authenticating
the device to the central system and then wirelessly transmitting
the partial payment authorization transaction record over a
cellular wireless communication network to the central system,
thereby enable a payment transaction from the customer to the
merchant.
REJECTIONS
Claims 1–20 stand rejected under 35 U.S.C. § 101 as directed to a
judicial exception to patentable subject matter. Final Act. 3–5.
OPINION
Rejection under 35 U.S.C. § 101
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Legal Principles
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 U.S. 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).
In determining whether a claim falls within an excluded category, we
are guided by the Court’s two-part framework, described in Mayo and Alice.
Alice, 573 U.S. 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, 561 U.S. 593, 611 (2010) (“Claims 1 and 4
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.
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252, 267–68 (1853))); 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
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., id. at 187 (“It is now commonplace that an application of a
law of nature or 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 part
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). “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.
(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.
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In January 2019, the U.S. Patent and Trademark Office (USPTO)
published revised guidance on the application of § 101. 2019 Revised Patent
Subject Matter Eligibility Guidance, 84 Fed. Reg. 50 (Jan. 7, 2019)
(“2019 Revised Guidance”).1 “All USPTO personnel are, as a matter of
internal agency management, expected to follow the guidance.” Id. at 51;
see also October 2019 Update at 1.
Under the 2019 Revised Guidance and the October 2019 Update, 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) (“Step 2A, Prong One”); and
(2) additional elements that integrate the judicial exception into
a practical application (see MPEP § 2106.05(a)–(c), (e)–(h) (9th
ed. Rev. 08.2017, Jan. 2018)) (“Step 2A, Prong Two”).2
2019 Revised Guidance, 84 Fed. Reg. at 52–55.
Only if a claim (1) recites a judicial exception and (2) does not
integrate that exception into a practical application, do we then look, under
Step 2B, to whether the claim:

1 In response to received public comments, the Office issued further
guidance on October 17, 2019, clarifying the 2019 Revised Guidance.
USPTO, October 2019 Update: Subject Matter Eligibility (the “October
2019 Update”) (available at https://www.uspto.gov/sites/default/files/
documents/peg_oct_2019_update.pdf).
2 This evaluation is performed by (a) identifying whether there are any
additional elements recited in the claim beyond the judicial exception, and
(b) evaluating those additional elements individually and in combination to
determine whether the claim as a whole integrates the exception into a
practical application. See 2019 Revised Guidance - Section III(A)(2), 84
Fed. Reg. 54–55.
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(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
(4) simply appends well-understood, routine, conventional
activities previously known to the industry, specified at a high
level of generality, to the judicial exception.
2019 Revised Guidance, 84 Fed. Reg. at 52–56.
Prong One of Step 2A
Under prong one of step 2A, we first look to whether the claim recites
any judicial exceptions, including certain groupings of abstract ideas (i.e.,
mathematical concepts, certain methods of organizing human activities, or
mental processes). 2019 Revised Guidance, 84 Fed. Reg. at 52–54. To this
end we note that claim 1 recites “[a] secure payment system between a
customer and a merchant using a sales terminal of the merchant and a central
system on a global computer network.” The Federal Circuit has held that
processing of payments is a fundamental economic practice. See Inventor
Holdings, LLC v. Bed Bath & Beyond, Inc., 876 F.3d 1372, 1378–79 (Fed.
Cir. 2017); see also CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d
1366 (Fed. Cir. 2011) (holding a method and system for detecting fraud in a
credit card transaction over the Internet to be patent ineligible). Claim 1
also recites
the logic in the wireless device processes the partial payment
authorization transaction record by first authenticating the
device to the central system and then wirelessly transmitting the
partial payment authorization transaction record over a cellular
wireless communication network to the central system, thereby
enable a payment transaction from the customer to the
merchant.
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This step describes that the device is authenticated using the data gathered
and the data is then transmitted over a cellular network to the central system
to enable the payment transaction. Thus, this step further illustrates that the
claim recites the fundamental economic practice of securely processing
payments.
As explained above, we find the claim recites steps for securely
processing payments and that processing payments is a fundamental
economic practice. Fundamental economic practices fall in the category of
certain methods of organizing human behavior, which the 2019 Revised
Guidance recognizes as constituting an abstract idea. See 2019 Revised
Guidance, 84 Fed. Reg. at 52. Thus, under prong one of step 2A we
determine the claims recite an abstract idea.
Appellant argues,
[t]he claimed subject matter is directed to commerce using a
mobile device working in conjunction with a sales terminal of a
merchant and servers on the global computer network, with
specific structural elements, logic and interfaces. These claim
elements do not equate to ‘a fundamental economic practice’, as
that phrase is used and defined in Alice.
Appeal Br. 17. We disagree. As explained above payment processing has
been found by our reviewing court to be a fundamental economic practice.
The recited mobile device and global computer network will be analyzed
further in the following steps of our analysis under the 2019 Revised
Guidance.
Prong Two of Step 2A
Under prong 2 of step 2A of the 2019 Revised Guidance we determine
whether the claim as whole integrates the recited abstract idea into a
practical application of the abstract idea. A claim that integrates a judicial
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exception into a practical application will 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. To evaluate whether the claims integrate
the abstract idea into a practical application, we identify whether there are
any additional elements recited beyond the abstract idea, and evaluate those
additional elements individually and in combination.
Some exemplary considerations laid out by the Supreme Court and the
Federal Circuit indicative that an additional element integrates an abstract
idea into a practical application include (i) an improvement in the
functioning of a computer or to another technological field, (ii) an
application of the judicial exception with, or by use of, a particular machine,
(iii) a transformation or reduction of a particular article to a different state or
thing, or (iv) a use of the judicial exception in some other meaningful way
beyond generally linking the use of the judicial exception to a particular
technological environment. See MPEP § 2106.05(a)–(c), (e)–(h).
Appellant argues that the limitations of the claim are “not capable of
being performed mentally using a pen and paper and are squarely directed to
a digital machine.” Appeal Br. 17. Appellant argues that claim limitations
are “not being performed mentally and are instead rooted in the technology
of computer systems and specifically the technology of servers and mobile
wireless devices and their interfaces over a global communication network.”
Appeal Br. 17; see also Reply Br. 8–9 (“[T]he claimed subject matter is
squarely directed to a security system that has its structure, a specific digital
machine that of a mobile wireless device with unique logic operating in the
digital machine and with unique interfaces to other systems.”)
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Reviewing the claim limitations as a whole, we determine the claim
does not recite additional elements that integrate the abstract idea into a
practical application. In particular we find that the claim limitations do not
improve the functioning of a computer or other technological field. Instead
the technological elements of the claim simply link the fundamental
economic practice to the technological environment of mobile devices,
computers, and networks.
When considering whether claims are directed to an improvement in
computer functionality, we “ask whether the focus of the claims is on the
specific asserted improvement in computer capabilities ... or, instead, on a
process that qualifies as an ‘abstract idea’ for which computers are invoked
merely as a tool.” Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1335–36
(Fed. Cir. 2016).
The limitations that we did not address above in prong one include “a
cellular wireless device . . . equipped with a wireless data receiving sensor . .
. able to receive a partial payment authorization transaction record from the
sales terminal of the merchant.” This limitation recites the data gathering
steps required to securely process payments. Data gathering steps “cannot
make an otherwise nonstatutory claim statutory.” CyberSource, 654 F.3d at
1370 (quoting In re Grams, 888 F.2d 835, 840 (Fed. Cir. 1989)). Claim 1
further recites
a logic stored in a memory of the wireless device . . . receives
and processes the partial payment authorization transaction
record from the sales terminal, wherein the partial payment
authorization transaction record meta data includes data fields
of only a date and a time of the sales transaction, a transaction
reference number, a merchant terminal identification and a
payment amount.
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This limitation describes the data gathered and identifies the specific fields
of data gathered in order to process the payment.
The limitations Appellant calls to our attention include the “cellular
wireless device,” the servers of the “central system,” and the interfaces over
a “global computer network.” As specifically claimed, however, there is no
indication that these elements or the technology underlying them is
improved by the invention. Instead the recited elements are used to
implement the secure payment processing system. For example, the claimed
“cellular wireless device” is described in the Specification as “a cellular
telephone with a screen and a keypad. Alternatively, it may be PDA with a
wireless modem, which also has a display screen and a soft keypad.” Spec.
7:17–29. This description indicates that the claimed cellular wireless device
is part of the technological environment in which the invention is
implemented but does not indicate that the claimed cellular wireless device
is improved by the invention. Similarly, the central system is described as
including a storage device, operating system, system program, and system
processor. Spec. 17:24–28. The global computer network is not described
in detail but allows for communication between the mobile device and the
central system. See Fig. 3, Spec. 15:17–20. The interface on the central
system that connects to the global computer network is described as a
“conventional internal or external modem[],” (Spec. 18:8–12) further
illustrating that the network is not improved by the claimed invention.
Mortg. Grader, Inc. v. First Choice Loan Serv. Inc., 811 F.3d 1314, 1324–
25 (Fed. Cir. 2016) (claims reciting an “interface,” “network,” and
“database” were nevertheless directed to an abstract idea).
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Accordingly, we do not find the claims integrate the abstract idea into
a practical application.
Step 2B of the Guidance
Under step 2B of the 2019 Revised Guidance we analyze the claims to
determine whether they provide an inventive concept (i.e., whether the
additional elements amount to significantly more than the exception itself).
Considerations that are evaluated with respect to step 2B include
determining whether the claims as a whole add a specific limitation or
combination of limitations that are not well-understood, routine,
conventional activity in the field.
Appellant argues the claimed “features and functions of a mobile
wireless device with interfaces to sales terminals and servers on the global
computer network are directed to privacy and security of customer bankcard
data.” Appeal Br. 22. Appellant argues that “[a] very large number of sales
transactions happen every day with merchants where the privacy and
security of customer data is put at risk” and that “merchants have no
effective and viable means to safeguard consumer private data being
acquired by these sales terminals in the process of processing a payment for
sales transaction via a bankcard.” Appeal Br. 22. Thus, Appellant argues,
the claimed subject matter is non-routine and non-conventional. Appeal Br.
22.
We are unpersuaded by Appellant’s argument. First, analyzing the
claim limitations individually and as an ordered combination, we note, as we
did above, that the limitations beyond the abstract idea include the “cellular
wireless device,” the servers of the “central system,” and the interfaces over
a “global computer network.” As explained above, these claimed elements
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appear to be used in their routine and conventional manner to implement the
claimed secure payment processing system. Furthermore, to the extent
Appellant is arguing that the claims are directed to an inventive concept
because the merchants have not implemented such a system before, we note
that although the second step in the Alice/Mayo framework is termed a
search for an “inventive concept,” the analysis is not an evaluation of
novelty or non-obviousness, but rather a search for “‘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, 573 U.S. at 217–18. A novel and nonobvious claim directed
to a purely abstract idea is, nonetheless, patent-ineligible. See Mayo, 566
U.S. at 90.
Accordingly, we sustain the Examiner’s rejection of claims 1–20
under 35 U.S.C. § 101.
DECISION SUMMARY
In summary:
Claims
Rejected
35 U.S.C.
§
Reference(s)/Basis Affirmed Reversed
1–20 101 Eligibility 1–20

TIME PERIOD FOR RESPONSE
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