Visa International Service Association et al.

Patent Trials and Appeals Board

Aug 20, 2020

2020003182 (P.T.A.B. Aug. 20, 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.
14/514,290 10/14/2014 Glenn Leon Powell 079900-0919955-775US03 9893
66945 7590 08/20/2020
KILPATRICK TOWNSEND & STOCKTON LLP/VISA
Mailstop: IP Docketing - 22
1100 Peachtree Street
Suite 2800
Atlanta, GA 30309
EXAMINER
LEFFALL-ALLEN, NAKIA
ART UNIT PAPER NUMBER
3685
NOTIFICATION DATE DELIVERY MODE
08/20/2020 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):
KTSDocketing2@kilpatrick.foundationip.com
ipefiling@kilpatricktownsend.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte GLENN LEON POWELL, JOHN F. SHEETS,
BRUCE RUTHERFORD, GREGORY WILLIAMSON, and
JAMES ANDERSON
Appeal 2020-003182
Application 14/514,290
Technology Center 3600
Before JAMES R. HUGHES, JOHN A. EVANS, and
LARRY J. HUME, Administrative Patent Judges.

HUME, Administrative Patent Judge.
DECISION ON APPEAL
Pursuant to 35 U.S.C. § 134(a), Appellant1 appeals from the
Examiner’s decision rejecting claims 1, 3, 7–11, 13, and 16–19, which are
all claims pending in the application. Appellant has canceled claims 2, 4–6,
12, 14, 15, and 20. See Appeal Br. 21–25 (Claims App.). 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. Appellant identifies the real parties in interest as Visa International
Service Association and Mastercard International Incorporated. Appeal
Br. 2.
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STATEMENT OF THE CASE2
The claims are directed to a network token system. See Spec. (Title).
In particular, Appellant’s disclosed embodiments and claimed invention
relate to “methods, apparatuses, computer readable media and systems for
providing, along with a token, a token assurance level and data used to
generate the token assurance level.” Spec. 72 (Abstract).
Exemplary Claims
Claim 1, reproduced below, is illustrative of the subject matter on
Appeal (italics added to dispositive prior-art limitation, and underlining
added to contested written description limitations):
1. A method comprising:
receiving, by a computer, a token generation message
requesting a payment token corresponding to a primary account
number from a token requestor;
determining, by the computer, an identification and
verification process verifying the token requestor;
performing, by the computer, the identification and
verification process on the token requestor;
determining, by the computer, a payment token
corresponding to the primary account number;
identifying, by the computer, a confidence level for a
binding between the token and the primary account number
based on the identification and verification process;

2 Our decision relies upon Appellant’s Appeal Brief (“Appeal Br.,” filed
Oct. 15, 2019); Reply Brief (“Reply Br.,” filed Mar. 24, 2020); Examiner’s
Answer (“Ans.,” mailed Jan 24, 2020); Final Office Action (“Final Act.,”
mailed May 10, 2019); and the original Specification (“Spec.,” filed
Oct. 14, 2014) (claiming benefit of US 61/890,162, filed Oct. 11, 2013 and
US 61/906,377, filed Nov. 19, 2013).
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assigning, by the computer, a token assurance level
representing the confidence level to the payment token based on
the identification and verification process verifying the token
requestor;
storing the payment token, by the computer, the token
assurance level and the primary account number corresponding
to the payment token at a repository;
transmitting, by the computer, the payment token to the
token requestor;
receiving, by the computer after transmitting the payment
token to the token requestor, the payment token corresponding
to the primary account number in an authorization request
message associated with a transaction;
retrieving, by the computer, the token assurance level
corresponding to the token and data used during generation of
the token assurance level from the repository, wherein the data
used during generation of the token assurance level includes
one or more of a type of the identification and verification
process performed to verify the token requestor, data used in
performing the identification and verification process, and a
result of the identification and verification process;
modifying, by the computer, the authorization request
message to include the token assurance level and the data used
during generation of the token assurance level;
transmitting, by the computer, the modified authorization
request message to an issuer computer of an account
corresponding to the primary account number, the issuer
computer authorizes the transaction at least based upon the
confidence level value identified by the token assurance level;
and
receiving, by the computer, an authorization response
from the issuer computer.
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REFERENCES
The prior art relied upon by the Examiner as evidence is:
Name Reference Date
Flitcroft et al. (“Flitcroft”) US 2003/0028481 A1 Feb. 6, 2003
Carlson et al. (“Carlson”) US 2012/0259784 A1 Oct. 11, 2012
REJECTIONS
R1. Claims 1, 3, 7–11, 13, and 16–19 stand rejected under 35
U.S.C. § 101 because the claimed invention is directed to an abstract idea
without significantly more. Final Act. 6; Ans. 3.
R2. Claims 1, 3, 7–11, 13, and 16–193 stand rejected under 35
U.S.C. § 112(a) as lacking written description support. Final Act. 10;
Ans. 3.
R3. Claims 1, 3, 7–11, 13, and 16–194 stand rejected under 35
U.S.C. § 103 as being unpatentable over the combination of Flitcroft and
Carlson. Final Act. 13; Ans. 3.
ISSUES AND ANALYSIS
We agree with particular arguments made by Appellant with respect
to Rejections R1 through R3 of claims 1, 3, 7–11, 13, and 16–19, and

3 We note an apparent typographical error in Rejection R2 which omits
claim 13 in the explicit statement of the rejection, but includes claim 13 in
the detailed rejection. Compare Final Act. 10 with Final Act. 12.
4 We note an apparent typographical error in Rejection R3 that includes
claim 15, which has been canceled. See Ans. 3.
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therefore reverse the Examiner’s rejections, as discussed below with respect
to illustrative claim 1.
1. § 101 Rejection R1 of Claims 1, 3, 7–11, 13, and 16–19
Issue 1
Appellant argues (Appeal Br. 7–12; Reply Br. 2–7) the Examiner’s
rejection of claim 1 under 35 U.S.C. § 101 as being directed to patent-
ineligible subject matter is in error because the claims provide for a practical
application in light of the Revised Guidance. These contentions present us
with the following issue:
Under the USPTO’s Revised Guidance, informed by our governing
case law concerning patent eligibility under 35 U.S.C. § 101, is claim 1
patent-ineligible under § 101?
Principles of Law
A. 35 U.S.C. § 101
An invention is patent-eligible if it is a “new and useful process,
machine, manufacture, or composition of matter.” 35 U.S.C. § 101.5
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. Mayo Collaborative Servs. v. Prometheus Labs.,

5 This threshold analysis of whether a claim is directed to one of the four
statutory categories of invention, i.e., a process, machine, manufacture, or
composition of matter, is referred to as “Step 1” in the USPTO’s patent-
eligibility analysis under § 101. MPEP § 2106.
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Inc., 566 U.S. 66, 70 (2012) (brackets in original) (citing Diamond v. Diehr,
450 U.S. 175, 185 (1981)).
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. Alice Corp. v. CLS Bank Int’l, 573 U.S. 208, 217–18 (2014)
(citing Mayo, 566 U.S. at 75–77). 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” (Diehr, 450 U.S. at 191); “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 (1853)));
and manufacturing flour (Benson, 409 U.S. at 69 (citing Cochrane v.
Deener, 94 U.S. 780, 785 (1876))).
Abstract ideas may include, but are not limited to, fundamental
economic practices, methods of organizing human activities, and
mathematical formulas or relationships. Alice, 573 U.S. at 217–21. Under
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this guidance, we must therefore ensure at step one that we articulate what
the claims are directed to with enough specificity to ensure the step one
inquiry is meaningful. Id. at 217 (“[W]e tread carefully in construing this
exclusionary principle lest it swallow all of patent law.”).
Examples of claims that do not recite mental processes because they
cannot be practically performed in the human mind include: (a) a claim to a
method for calculating an absolute position of a GPS receiver and an
absolute time of reception of satellite signals, where the claimed GPS
receiver calculated pseudoranges that estimated the distance from the GPS
receiver to a plurality of satellites, SiRF Technology, Inc. v. International
Trade Commission, 601 F.3d 1319, 1331–33 (Fed. Cir. 2010); (b) a claim to
detecting suspicious activity by using network monitors and analyzing
network packets, SRI Int’l, Inc. v. Cisco Systems, Inc., 930 F.3d 1295, 1304
(Fed. Cir. 2019); (c) a claim to a specific data encryption method for
computer communication involving a several-step manipulation of data,
Synopsys, Inc. v. Mentor Graphics Corp., 839 F.3d 1138, 1149 (Fed.
Cir. 2016) (distinguishing TQP Development, LLC v. Intuit Inc., 2014 WL
651935 (E.D. Tex. Feb. 19, 2014)) (the specific data encryption method
“could not conceivably be performed in the human mind or with pencil and
paper”). Whereas a claim limitation to a process that “can be performed in
the human mind, or by a human using a pen and paper” qualifies as a mental
process, a claim limitation that “could not, as a practical matter, be
performed entirely in a human’s mind” (even if aided with pen and paper)
would not qualify as a mental process.6

6 CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d 1366, 1372, 1375–
76 (Fed. Cir. 2011) (distinguishing Research Corp. Techs. v. Microsoft
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In Diehr, the claim at issue recited a mathematical formula, but the
Supreme Court held “[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. (citation omitted) (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
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 (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).

Corp., 627 F.3d 859 (Fed. Cir. 2010), and SiRF Tech., Inc. v. Int’l Trade
Comm’n, 601 F.3d 1319 (Fed. Cir. 2010)).
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“[M]erely requir[ing] generic computer implementation[] fail[s] to transform
that abstract idea into a patent-eligible invention.” Id.
B. USPTO Revised Guidance
The PTO published revised guidance in the Federal Register
concerning the application of § 101. 2019 Revised Patent Subject Matter
Eligibility Guidance, 84 Fed. Reg. 50 (Jan. 7, 2019) (hereinafter “Revised
Guidance”) (https://www.govinfo.gov/content/pkg/FR-2019-01-
07/pdf/2018-28282.pdf). “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 (October 2019 Update: Subject Matter Eligibility)
(hereinafter “October 2019 Update”).
Under the Revised 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);7 and
(2) additional elements that integrate the judicial
exception into a practical application (see Manual for Patent
Examining Procedure (“MPEP”) §§ 2106.05(a)–(c), (e)–(h)).8
See Revised Guidance 52–53.

7 Referred to as “Revised Step 2A, Prong 1” in the Revised Guidance
(hereinafter “Step 2A(i)”).
8 Referred to as “Revised Step 2A, Prong 2” in the Revised Guidance
(hereinafter “Step 2A(ii)”).
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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
(4) simply appends well-understood, routine,
conventional activities previously known to the industry,
specified at a high level of generality, to the judicial exception.9
See Revised Guidance 56.
Step 2A(i) – Abstract Idea
Informed by our judicial precedent, the Revised Guidance extracts and
synthesizes key concepts identified by the courts as abstract ideas to explain
that the abstract idea exception includes the following groupings of subject
matter, when recited as such in a claim limitation:
(a) Mathematical concepts—mathematical relationships,
mathematical formulas or equations, mathematical calculations;
(b) Certain methods of organizing human activity —
fundamental economic principles or practices (including
hedging, insurance, mitigating risk); commercial or legal
interactions (including agreements in the form of contracts;
legal obligations; advertising, marketing or sales activities or
behaviors; business relations); managing personal behavior or
relationships or interactions between people (including social
activities, teaching, and following rules or instructions); and
(c) Mental processes—concepts performed in the human
mind (including an observation, evaluation, judgment, opinion).

9 Items (3) and (4) continue to be collectively referred to as “Step 2B” of the
Supreme Court’s two-step framework, described in Mayo and Alice.
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Revised Guidance 52 (footnotes omitted).
Under the Revised Guidance, if the claim does not recite a judicial
exception (a law of nature, natural phenomenon, or subject matter within the
enumerated groupings of abstract ideas above), then the claim is patent-
eligible at Step 2A(i). This determination concludes the eligibility analysis,
except in situations identified in the Revised Guidance.10
However, if the claim recites a judicial exception (i.e., an abstract idea
enumerated above, a law of nature, or a natural phenomenon), the claim
requires further analysis for a practical application of the judicial exception
in Step 2A(ii).
Step 2A(ii) – Practical Application
If a claim recites a judicial exception in Step 2A(i), we determine
whether the recited judicial exception is integrated into a practical
application of that exception in Step 2A(ii) by: (a) identifying whether there
are any additional elements recited in the claim beyond the judicial
exception(s); and (b) evaluating those additional elements, along with the
limitations that recite a judicial exception, individually and in combination
to determine whether they integrate the exception into a practical
application.

10 In the rare circumstance in which an examiner believes a claim limitation
that does not fall within the enumerated groupings of abstract ideas should
nonetheless be treated as reciting an abstract idea, the procedure described in
the Guidance for analyzing the claim should be followed. See Revised
Guidance, Section III.C.
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The seven identified “practical application” sections of the MPEP,11
cited in the Revised Guidance under Step 2A(ii), are:
(1) MPEP § 2106.05(a) Improvements to the Functioning of
a Computer or To Any Other Technology or Technical
Field
(2) MPEP § 2106.05(b) Particular Machine
(3) MPEP § 2106.05(c) Particular Transformation
(4) MPEP § 2106.05(e) Other Meaningful Limitations
(5) MPEP § 2106.05(f) Mere Instructions To Apply An
Exception
(6) MPEP § 2106.05(g) Insignificant Extra-Solution Activity
(7) MPEP § 2106.05(h) Field of Use and Technological
Environment
See Revised Guidance 55.
If the recited judicial exception is integrated into a practical
application as determined under one or more of the MPEP sections cited
above, then the claim is not directed to the judicial exception, and the patent-
eligibility inquiry ends. See Revised Guidance 54. If not, then analysis
proceeds to Step 2B.
Step 2B – “Inventive Concept” or “Significantly More”
Under our reviewing courts’ precedent, it is possible that a claim that
does not “integrate” a recited judicial exception under Step 2A(ii) is
nonetheless patent eligible. For example, the claim may recite additional

11 See MPEP § 2106.05(a)–(c), (e)–(h). Citations to the MPEP herein refer
to revision [R-08.2017]. Sections 2106.05(a), (b), (c), and (e) are indicative
of integration into a practical application, while § 2106.05(f), (g), and (h)
relate to limitations that are not indicative of integration into a practical
application.
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elements that render the claim patent eligible even though one or more claim
elements may recite a judicial exception.12 The Federal Circuit has held
claims eligible at the second step of the Alice/Mayo test (USPTO Step 2B)
because the additional elements recited in the claims provided “significantly
more” than the recited judicial exception (e.g., because the additional
elements were unconventional in combination).13 Therefore, if a claim has
been determined to be directed to a judicial exception under Revised Step
2A, we must also evaluate the additional elements individually and in
combination under Step 2B to determine whether they provide an inventive
concept (i.e., whether the additional elements amount to significantly more
than the exception itself).14
Under the Revised Guidance, we must consider in Step 2B whether an
additional element or combination of elements: (1) “Adds a specific
limitation or combination of limitations that are not well-understood,
routine, conventional activity in the field, which is indicative that an
inventive concept may be present;” or (2) “simply appends well-understood,
routine, conventional activities previously known to the industry, specified

12 See, e.g., Diehr, 450 U.S. at 187.
13 See, e.g., Amdocs, Ltd. v. Openet Telecom, Inc., 841 F.3d 1288, 1300,
1304 (Fed. Cir. 2016); BASCOM Glob. Internet Servs., Inc. v. AT&T
Mobility LLC, 827 F.3d 1341, 1349–52 (Fed. Cir. 2016); DDR Holdings v.
Hotels.com, L.P., 773 F.3d 1245, 1257–59 (Fed. Cir. 2014).
14 The patent eligibility inquiry may contain underlying issues of fact.
Mortg. Grader, Inc. v. First Choice Loan Servs. Inc., 811 F.3d 1314, 1325
(Fed. Cir. 2016). In particular, “[t]he question of whether a claim element or
combination of elements is well-understood, routine and conventional to a
skilled artisan in the relevant field is a question of fact.” Berkheimer v. HP
Inc., 881 F.3d 1360, 1368 (Fed. Cir. 2018).
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at a high level of generality, to the judicial exception, which is indicative
that an inventive concept may not be present.” See Revised Guidance,
Section III.B.15
In the Step 2B analysis, an additional element (or combination of
elements) is not well-understood, routine or conventional unless the
Examiner finds an evidentiary basis, and expressly supports a rejection in
writing with, one or more of the following:
1. A citation to an express statement in the
specification or to a statement made by an applicant during
prosecution that demonstrates the well-understood, routine,
conventional nature of the additional element(s). . . .
2. A citation to one or more of the court decisions
discussed in MPEP § 2106.05(d)(II) as noting the well-
understood, routine, conventional nature of the additional
element(s).
3. A citation to a publication that demonstrates the
well-understood, routine, conventional nature of the additional
element(s). . . .
4. A statement that the examiner is taking official
notice of the well-understood, routine, conventional nature of
the additional element(s). . . .

15 In accordance with existing Step 2B guidance, an Examiner’s finding that
an additional element (or combination of elements) is well understood,
routine, conventional activity must be supported with at least one of the four
specific types of evidence required by the USPTO Berkheimer
Memorandum, as shown above. For more information concerning evaluation
of well-understood, routine, conventional activity, see MPEP § 2106.05(d),
as modified by the USPTO Berkheimer Memorandum (USPTO
Commissioner for Patents Memorandum dated Apr. 19, 2018, “Changes in
Examination Procedure Pertaining to Subject Matter Eligibility, Recent
Subject Matter Eligibility Decision (Berkheimer v. HP, Inc.)” (hereinafter
“Berkheimer Memo”).
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See Berkheimer Memo 3–4.
If the Examiner or the Board determines under Step 2B that the
element (or combination of elements) amounts to significantly more than the
exception itself, the claim is eligible, thereby concluding the eligibility
analysis.
However, if a determination is made that the element and combination
of elements do not amount to significantly more than the exception itself, the
claim is ineligible under Step 2B, and the claim should be rejected for lack of
subject matter eligibility.
Analysis
Step 1 – Statutory Category
Claim 1, as a method (process) claim, recites one of the enumerated
categories of eligible subject matter in 35 U.S.C. § 101. Therefore, the issue
before us is whether it is directed to a judicial exception without
significantly more.
Step 2A(i): Does the Claim Recite a Judicial Exception?
The Examiner determined that claim 1 is grouped within the “certain
methods of organizing human activity” grouping of abstract ideas “because
creating and verifying a financial credential for use in a transaction is a
fundamental economic practice, commercial or legal interactions, managing
personal behavior or relationships or interactions between people.
Accordingly, the claims recite an abstract idea.” Final Act. 7.
We conclude claim 1 does not recite the judicial exceptions of either
natural phenomena or laws of nature. We evaluate, de novo, whether
claim 1 recites an abstract idea based upon the Revised Guidance.
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First, we look to the Specification to provide context as to what the
claimed invention is directed to. In this case, the Specification discloses that
the invention is directed to solving problems of fraudulent activity
associated with the use of a primary account number (PAN) by using
payment tokens instead of the PAN. Spec. ¶¶ 4–6.
Appellant’s Abstract describes the invention:
Embodiments of the invention are directed to methods,
apparatuses, computer readable media and systems for
providing, along with a token, a token assurance level and data
used to generate the token assurance level. At the time a token
is issued, one or more Identification and Verification (ID&V)
methods may be performed to ensure that the token is replacing
a PAN that was legitimately used by a token requestor. A token
assurance level may be assigned to a given token in light of the
type of ID&V that is performed and the entity performing the
ID&V. Different ID&Vs may result in different token assurance
levels. An issuer may wish to know the level of assurance and
the data used in generating the level of assurance associated
with a token prior to authorizing a payment transaction that
uses the token.
Spec. 72 (Abstract).
For purposes of our Decision, we assume the claims recite abstract
ideas under Step 2A(i) under the “certain methods of organizing human
activity” grouping of abstract ideas, i.e., “creating and verifying a financial
credential for use in a transaction” as concluded by the Examiner, and we
direct our analysis to the “practical application” aspects of the claims, i.e.,
Step 2A(ii).
Step 2A(ii): Judicial Exception Integrated into a Practical Application?
If the claims recite a judicial exception, as we assume above, we
proceed to the “practical application” Step 2A(ii) in which we determine
whether the recited judicial exception is integrated into a practical
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application of that exception by: (a) identifying whether there are any
additional elements recited in the claim beyond the judicial exception(s); and
(b) evaluating those additional elements individually and in combination to
determine whether they integrate the exception into a practical application.
With respect to this phase of the analysis, Appellant argues “the
claims clearly provide for a ‘practical application’ . . . . [because]
conventional systems that generate payment tokens do not assign ‘token
assurance levels’ to payment tokens.” Appeal Br. 10. “As such, Appellants
submit that this is an ‘application’ that is ‘practical,’ since embodiments of
the invention improve upon the security and reliability of conventional
payment transaction processing.” Appeal Br. 11.
With respect to Appellant’s argument that the claims are directed to
improved security and reliability of payment transaction processing, and not
exclusively to a financial transaction, Appellant further contends:
Appellant’s claim 1 recites performing an identification and
verification (ID&V) process, determining a payment token,
identifying a confidence level for the binding between the
payment token and the PAN based on the ID&V process, and
assigning a token assurance level to the payment token
representing the confidence level. . . . Appellants’ claim 1
introduces the inventive concept of the token assurance level
which is assigned to a given token in light of the type of ID&V
that is performed. Different ID&Vs may result in different
token assurance levels. For example, no or minimal ID&V
performed by a non-trusted entity may result in a low token
assurance level, while a detailed ID&V performed by a trusted
entity would likely result in a high token assurance level.
Accordingly, the level of assurance associated with a token
depends on the ID& V method performed when the token is
generated, and the entity that performed the ID& V method. An
issuer may wish to know the level of assurance and the data
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used in generating the level of assurance associated with a
token prior to authorizing a payment transaction that uses the
token. Thus, embodiments of the invention improve upon
existing, conventional payment systems that use payment
tokens to conduct payment transactions.
Appeal Br. 10.
In response, the Examiner states that the claims recite creating and
verifying a financial transaction, which is an abstract idea in the “Certain
Methods of Organizing Human Activity” grouping of abstract ideas,
“because the claims involve creating and verifying a financial credential for
use in a transaction.” Ans. 5. The Examiner further determined:
This judicial exception is not integrated into a practical
application because, when analyzed under prong two of step 2A
of the Alice/Mayo test . . . the additional elements of the claim
such as a “computer”, “processor”, “non-transitory computer
readable medium” and “issuer computer” merely serves as tools
to perform the abstract idea and/or generally link the use of a
judicial exception to a particular technological environment.
Ans. 5–6 (citation to Revised Guidance omitted).
Appellant responds by arguing “the token assurance level and data
used in generating the token assurance level are not financial credentials.
Rather, the token assurance level is a security feature that identifies a
confidence level of the entity generating the token assurance level.” Reply
Br. 3.
We disagree with the Examiner’s determination that the claims are
directed to creating and verifying a financial transaction per se, because the
Examiner omits analysis of the claim as a whole, but instead only focuses on
the additional hardware elements recited in the claims.
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The Revised Guidance requires Prong 2 analysis as follows:
In Prong Two, examiners should evaluate whether the claim as
a whole integrates the recited judicial exception into a practical
application of the exception. A claim that integrates a judicial
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.
When the exception is so integrated, then the claim is not
directed to a judicial exception (Step 2A: NO) and is eligible.
This concludes the eligibility analysis.
Revised Guidance 54.
As to the specific limitations, and in agreement with Appellant (see
Reply Br. 4), we find the limitations “identifying a confidence level for a
binding between the token and the primary account number based on the
identification and verification process;” and “assigning a token assurance
level representing the confidence level to the payment token based on the
identification and verification process verifying the token requestor”
integrate the assumed abstract idea of creating and verifying a financial
credential for use in a transaction into a practical application as determined
under at least one of the MPEP sections cited above.16 See Spec. ¶¶ 40, 41,
77–79, 103, 107.
Even if we assume that the claims recite abstract ideas as identified by
the Examiner, we find Appellant’s argument persuasive that carrying out the
above-identified steps provide improvements to the underlying technology
or technical field, namely, token-based payment processing systems. See

16 See, e.g., MPEP § 2106.05(a) “Improvements to the Functioning of a
Computer or To Any Other Technology or Technical Field,” and
§ 2106.05(e) “Other Meaningful Limitations.”
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MPEP § 2106.05(a) or, alternatively, § 2106.05(e) “Other Meaningful
Limitations.” Accordingly, we conclude, when the claim is considered as a
whole, the recited judicial exception is integrated into a practical application
as determined under either MPEP sections 2106.06(a) or 2106.05(e) cited
above, such that the claim is patent-eligible.
Because the claims are directed to a patent-eligible concept, this
concludes the patent-eligibility inquiry.
Accordingly, based upon the findings and legal conclusions above, on
this record and in consideration of the Revised Guidance, we are persuaded
the claims are directed to patent-eligible subject matter, such that we do not
sustain the § 101 rejection of claim 1, and grouped claims 3, 7–11, 13, and
16–19 which stand therewith. See Claim Grouping, supra.
2. § 112(a) Written Description Rejection R2: Claims 1, 3, 7–11, 13,
and 16–19
Issue 2
Appellant argues (Appeal Br. 13–14; Reply Br. 6) the Examiner’s
rejection of claim 1 under 35 U.S.C. § 112(a) as lacking written description
support is in error. These contentions present us with the following issues:
Did the Examiner err in finding the following steps of method claim 1
lack written description support in the originally filed disclosure?
(a) determining, by the computer, an identification and
verification process verifying the token requestor;
(b) performing, by the computer, the identification and
verification process on the token requestor;
(c) identifying, by the computer, a confidence level
for a binding between the token and the primary account
number based on the identification and verification process; and
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(d) assigning, by the computer, a token assurance level
representing the confidence level to the payment token based on
the identification and verification process verifying the token
requestor.
Principles of Law
The test for compliance with the written description requirement is
“whether the disclosure of the application relied upon reasonably conveys to
those skilled in the art that the inventor had possession of the claimed
subject matter as of the filing date.” Ariad Pharm., Inc. v. Eli Lilly & Co.,
598 F.3d 1336, 1351 (Fed. Cir. 2010) (en banc). “[T]he level of detail
required to satisfy the written description requirement varies depending on
the nature and scope of the claims and on the complexity and predictability
of the relevant technology.” Id.; cf. U.S. v. Telectronics, Inc., 857 F.2d 778,
785 (Fed. Cir. 1988) (“The test of enablement is whether one reasonably
skilled in the art could make or use the invention from the disclosures in the
patent coupled with information known in the art without undue
experimentation.”).
Further, the Specification “need not describe the claimed subject
matter in exactly the same terms as used in the claims.” Eiselstein v. Frank,
52 F.3d 1035, 1038 (Fed. Cir. 1995). “If . . . the specification contains a
description of the claimed invention, albeit not in ipsis verbis (in the
identical words), then the examiner . . . must provide reasons why one of
ordinary skill in the art would not consider the description sufficient.” In re
Alton, 76 F.3d 1168, 1175 (Fed. Cir. 1996).
Analysis
With respect to limitations (a) and (b), the Examiner finds the
Specification discloses that an ID&V method is performed in paragraphs 79,
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80, and 169, but asserts that these limitations, i.e., (a) “determining . . . an
identification and verification process” and (b) “performing . . . the
identification and verification process, are not detailed as separate
limitations.” Ans. 9.17 See also Final Act. 13 (where the Examiner finds
“[t]he specification does not detail separate steps of ‘determining . . . an
identification and verification process verifying the token requestor’ and
‘performing . . . the identification and verification process on the token
requestor,’” as recited in Appellant’s claims 1 and 11.).
Appellant contends these limitations are supported by the
Specification at paragraphs 78, 79, 82–84, and 162, and details, with
specificity, how limitations (a) and (b) are adequately supported by the
original written description. Appeal Br. 13–14. We have reviewed these
cited portions of the Specification, and we are persuaded by Appellant’s
arguments which we incorporate herein by reference.
With respect to limitations (c) and (d), the Examiner finds the
Specification does not detail “identifying . . . a confidence
level”. The specification recites the token assurance level is an
“indicator or a value that allows the token service provider to
indicate the confidence level” [0042] and “may be established
with respect to the token to PAN binding” and may be set when
the token is issued [0038; 0041; 0042]. The specification does
not detail a separate of “identifying . . . a confidence level . . . “.
The token assurance level is determined based on the
identification and verification process performed when the
token is issued [0042; 0077; 0078].

17 The Examiner cites to In re Katz Interactive Call Processing Patent
Litigation, 639 F.3d 1303, 1318 (Fed. Cir. 2011) in support of the written
description Rejection R2. We note the portion of Katz cited by the Examiner
relates to an indefiniteness rejection in that case, as pointed out by
Appellant. See Reply Br. 6.
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Final Act. 12.
In response, Appellant identifies paragraph 40 of the Specification as
providing written description support, i.e., “‘[u]sing the ID&V, a confidence
level may be established with respect to the token to PAN binding.’”
Appeal Br. 14 (quoting Spec. ¶ 40). Paragraphs 40 and 41 of the
Specification disclose:
An “identification and verification (ID&V) method” may
be used to ensure that the payment token is replacing a PAN
that was legitimately being used by the token requestor.
Examples of ID&V methods may include, but are not limited
to, an account verification message, a risk score based on
assessment of the primary account number (PAN) and use of
one time password by the issuer or its agent to verify the
account holder. Exemplary ID&V methods may be performed
using information such as a user signature, a password, an
offline or online personal identification number (PIN), an
offline or online enciphered PIN, a combination of offline PIN
and signature, a combination of offline enciphered PIN and
signature, user biometrics (e.g. voice recognition, fingerprint
matching, etc.), a pattern, a glyph, knowledge-based challenge-
responses, hardware tokens (multiple solution options), one
time passwords (OTPs) with limited use, software tokens, two-
channel authentication processes (e.g., via phone), etc. Using
the ID&V, a confidence level may be established with respect
to the token to PAN binding.
A “token assurance level” may refer to an indicator or a
value that allows the token service provider to indicate the
confidence level of the token to PAN binding. The token
assurance level may be determined by the token service
provider based on the type of identification and verification
(ID&V) performed and the entity that performed the ID&V.
The token assurance level may be set when issuing the token.
The token assurance level may be updated if additional ID&V
is performed.
Spec. ¶¶ 40–41.
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We are persuaded by Appellant’s argument which points out with
specificity the required written description support for the contested
limitations (c) and (d).
Therefore, based upon the findings above, on this record, we are
persuaded of error in the Examiner’s finding that limitations (a) through (d)
do not have adequate written description support such that we do not sustain
Rejection R2 of claims 1, 3, 7–11, 13, and 16–19.
3. § 103 Rejection R3 of Claims 1, 3, 7–11, 13, and 16–19
Issue 3
Appellant argues (Appeal Br. 15–20; Reply Br. 6–7) the Examiner’s
rejection of claim 1 under 35 U.S.C. § 103 as being obvious over the
combination of Flitcroft and Carlson is in error. These contentions present
us with the following dispositive issue:
Did the Examiner err in finding the cited prior art combination teaches
or suggests a method that includes, inter alia, the limitation of “assigning, by
the computer, a token assurance level representing the confidence level to
the payment token based on the identification and verification process
verifying the token requestor,” as recited in claim 1? 18

18 Because we agree with at least one of the dispositive arguments advanced
by Appellant, we need not reach the merits of Appellant’s other arguments.
See Beloit Corp. v. Valmet Oy, 742 F.2d 1421, 1423 (Fed. Cir. 1984)
(finding an administrative agency is at liberty to reach a decision based on “a
single dispositive issue”).
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Analysis
The Examiner finds that Flitcroft teaches or suggests the disputed
limitation. Final Act. 14 (citing Flitcroft ¶¶ 210, 232, 233, 235).
In response, Appellant generally contends “[t]he cited references are
entirely silent about a token assurance level, as recited in Appellant’s
claims.” Appeal Br. 16. Appellant specifically argues:
The cited sections of Flitcroft are directed to limited use
credit cards (e.g. credit cards whose use is subject to
[“]limitations”. If the Examiner is of the opinion that the
claimed token assurance level reads on Flitcroft’s limitations,
Appellants note that Flitcroft’s limitations are not determined
based on identification and verification process verifying the
token requestor. Flitcroft at ¶ [0101] and [0187] explains how
the limitations are determined. Nowhere does Flitcroft teach or
suggest identifying a confidence level for a binding between the
token and the primary account number based on the
identification and verification process, and assigning a token
assurance level representing the confidence level to the
payment token based on the identification and verification
process verifying the token requestor.
Appeal Br. 16–17.
Flitcroft discloses:
With the above system, the software responsible for
substituting the master account number for the limited use
number can also process additional features unique to limited
use numbers. These features include transaction value
limitations, merchant type restrictions and geographical
limitations. If the transaction exceeds the limitations placed on
the limited use card then authorization is denied and the master
credit card need not be passed on for further processing. In the
case of a transaction falling within the limitations of a limited
use card, then the transaction details are passed on with the
master account number for conventional validation. In this way
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the restrictions in place for the master account (e.g., available
balance, expiry date) are checked for each limited use
transaction.
Flitcroft ¶ 187
We have reviewed the portions of Flitcroft cited by the Examiner, i.e.,
paragraphs 210, 232, 233, and 235, and the portions of Flitcroft cited by
Appellant, i.e., paragraphs 101 and 187, and we see no teaching or
suggestion in Flitcraft of “a token assurance level representing the
confidence level to the payment token based on the identification and
verification process verifying the token requestor,” as recited in claim 1.
Instead, Flitcroft teaches parameters for establishing limitations on the use of
a credit card.
As reiterated by Appellant,
Flitcroft's limitations are not determined based on identification
and verification process verifying the token requestor. . . .
Flitcroft at ¶ [0101] and [0187] explains how the limitations are
determined. Nowhere does Flitcroft teach or suggest
identifying a confidence level for a binding between the token
and the primary account number based on the identification and
verification process, and assigning a token assurance level
representing the confidence level to the payment token based on
the identification and verification process verifying the token
requestor.
Reply Br. 7.
Based upon the findings above, on this record, we are not persuaded
of error in the Examiner’s reliance on the cited prior art combination to teach
or suggest the disputed limitation of claim 1, nor do we find error in the
Examiner’s resulting legal conclusion of obviousness. Therefore, we sustain
the Examiner’s obviousness rejection of independent claim 1, and
independent claim 11, which recites the dispositive limitation in
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commensurate form. For the same reasons, we do not sustain Rejection R3
of dependent claims 3, 7–10, 13, and 16–19 that stand with claims 1 or 11.
CONCLUSIONS
(1) Under our Revised Guidance, governed by relevant case law,
claims 1, 3, 7–11, 13, and 16–19 are not patent-ineligible under 35 U.S.C.
§ 101,and we do not sustain the rejection.
(2) The Examiner erred with respect to written description
Rejection R2 of claims 1, 3, 7–11, 13, and 16–19 under 35 U.S.C. § 112(a),
and we do not sustain the rejection.
(3) The Examiner erred with respect to obviousness Rejection R3
of claims 1, 3, 7–11, 13, and 16–19 under 35 U.S.C. § 103(a) over the cited
prior art combination of record, and we do not sustain the rejection.
DECISION SUMMARY
Claims
Rejected
35 U.S.C.
§
Basis /
References Affirmed Reversed
1, 3, 7–11,
13, 16–19 101
Subject Matter
Eligibility
1, 3, 7–11,
13, 16–19
1, 3, 7–11,
13, 16–19 112(a)
Written
Description
1, 3, 7–11,
13, 16–19
1, 3, 7–11,
13, 16–19
103
Obviousness
Flitcroft,
Carlson
1, 3, 7–11, 13, 16–19
Overall
Outcome
1, 3, 7–11,
13, 16–19
REVERSED