Ex Parte Cormack et al

Patent Trial and Appeal Board

Aug 13, 2018

14685255 (P.T.A.B. Aug. 13, 2018)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE
14/685,255 04/13/2015
35811 7590 08/15/2018
IP GROUP OF DLA PIPER LLP (US)
ONE LIBERTY PLACE
1650 MARKET ST, SUITE 4900
PHILADELPHIA, PA 19103
UNITED ST A TES OF AMERICA
FIRST NAMED INVENTOR
Michael A. Cormack
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
ATTORNEY DOCKET NO. CONFIRMATION NO.
NGI-14-1089DIV-CON-DIV2 3849
EXAMINER
KAZIMI, HAN! M
ART UNIT PAPER NUMBER
3691
NOTIFICATION DATE DELIVERY MODE
08/15/2018 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):
pto. phil@dlapiper.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte MICHAEL A. CORMACK, JENNIFER L. DRAKE,
THOMAS F. HALLER, and ROBERT A. HILL
Appeal2017-005887
Application 14/685,255 1
Technology Center 3600
Before ANTON W. PETTING, BRUCE T. WIEDER, and
MATTHEWS. MEYERS, Administrative Patent Judges.
WIEDER, Administrative Patent Judge.
DECISION ON APPEAL
This is a decision on appeal under 35 U.S.C. § 134 from the
Examiner's rejection of claims 1-21. We have jurisdiction under 35 U.S.C.
§ 6(b ).
We AFFIRM.
1 According to Appellants the real party in interest is NYSE Group, Inc.
(Appeal Br. 1.)
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Application 14/685,255
CLAIMED SUBJECT MATTER
Appellants' invention "relates generally to the field of electronic
trading methods and systems and in particular to directed order processing in
an electronic trading environment." (Spec. ,r 1.)
Claims 1 and 15 are the independent claims on appeal. Claim 1 is
illustrative. It recites:
1. A method for populating one or more guarantee order
books, comprising:
creating, by a posting market center, the one or more
guarantee order books specified for each of one or more
designated market makers, each guarantee order book
corresponding to one of the one or more designated market
makers that is permissioned to accept directed orders from a
specific order sending firm among one or more order sending
firms, wherein the posting market center includes one or more
computers, each computer comprising a non-transitory memory
configured to store instructions for execution by a processor;
creating, by the posting market center, routing permissions
for each guarantee order book that associates a specific one of
the one or more designated market makers with a specific one of
the one or more order sending firms to form a respective
permissioned pair;
receiving, by the posting market center, a plurality of
guarantee orders from among the one or more designated market
makers intended for at least one among the one or more order
sending firms, wherein at least one guarantee order among the
received plurality of guarantee orders varies in at least one of a
size, a price and a type;
populating, by the posting market center, the one or more
guarantee order books with the received plurality of guarantee
orders according to the routing permissions for each guarantee
order book;
receiving, by the posting market center, a directed order
from an order sending firm among the one or more order sending
firms intended for one designated market maker among the one
or more designated market makers; and
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automatically pairing, by the posting market center, the
received directed order with a guarantee order among guarantee
orders stored in one specific guarantee order book among the one
or more guarantee order books, without searching through all of
the one or more guarantee order books, based on the
corresponding routing permissions,
wherein the steps of creating the one or more guarantee
order books, creating the routing permissions, populating the one
or more guarantee order books and automatically pairing results
in a different and separate guarantee order book for each
permissioned pair among the one or more designated market
makers and the one or more order sending firms, and eliminates
a need for the one or more computers to search though all of the
received guarantee orders and all of the guarantee order books to
locate the guarantee order to automatically pair with the received
directed order, thereby reducing an order matching processing
time by the one or more computers of the posting market center.
REJECTION
Claims 1-21 are rejected under 35 U.S.C. § 101 as directed to a
judicial exception without significantly more.
ANALYSIS
"Whoever invents or discovers any new and useful process, machine,
manufacture, or composition of matter, or any new and useful improvement
thereof, may obtain a patent therefor, subject to the conditions and
requirements of this title." 35 U.S.C. § 101. Section 101, however,
"'contains an important implicit exception: Laws of nature, natural
phenomena, and abstract ideas are not patentable."' Alice Corp. Pty. Ltd. v.
CLS Bank Int 'l, 134 S. Ct. 2347, 2354 (2014) (quoting Ass 'nfor Molecular
Pathology v. Myriad Genetics, Inc., 569 U.S. 576, 589 (2013)).
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Alice applies a two-step framework, earlier set out 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, 134 S. Ct. at 2355.
Under the two-step framework, it must first be determined if "the
claims at issue are directed to a patent-ineligible concept." Id. If the claims
are determined to be directed to a patent-ineligible concept, e.g., an abstract
idea, then the second step of the framework is applied to determine if "the
elements of the claim ... contain[] an 'inventive concept' sufficient to
'transform' the claimed abstract idea into a patent-eligible application." Id.
at 2357 (citing Mayo, 566 U.S. at 72-73, 79).
With regard to step one of the Alice framework, the Examiner
determines that "[t]he instant claims are directed to the abstract idea of a
fundamental economic practice (i.e. trading and directed order processing.)"
(Final Action 7 .)
Appellants disagree and argue that
Appellant's [sic] claims are directed toward a new specialized
posting market center that creates routing permissions for
guarantee order books and automatically pairs a received
directed order with a guarantee order stored in a specific
guarantee order book without having to search through all of the
guarantee order books (where avoiding this type of searching is
contrary to the convention in this art). This results in a different
and separate guarantee order book for each permissioned pair,
eliminating the need to search through all of the received
guarantee orders and order books, thereby reducing computer
order matching processing time and resource consumption of the
one or more computers of the posting market center. Because
reducing an order matching processing time and resource
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consumption improves the computer system, and the reduction
of time is actually claimed, [2J Appellant's [sic] claims improve
the functioning of the computer itself, and are therefore patent-
eligible.
(Appeal Br. 5.)
Under step one of the Alice framework, we "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 Texas, LLC
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)).
The Specification provides evidence as to what the claimed invention
is directed. In this case, the Specification discloses that the invention
"relates generally to the field of electronic trading methods and systems and
in particular to directed order processing in an electronic trading
environment." (Spec. ,r 1.) Claim 1 provides additional evidence. Claim 1
recites "[a] method for populating one or more guarantee order books,
comprising: creating ... the one or more guarantee order books," "creating
... routing permissions for each guarantee order book," "receiving ... a
plurality of guarantee orders," "populating ... the one or more guarantee
order books with the received plurality of guarantee orders," "receiving ... a
directed order from an order sending firm," and "pairing ... the received
directed order with a guarantee order," "wherein the steps ... result[] in a
2 The recitation of "thereby reducing an order matching processing time by
the one or more computers of the posting market center" in claim 1, and
similar language in claim 15, is not given patentable weight as "it simply
expresses the intended result of a process step positively recited." See
Minton v. Nat'! Ass 'n of Securities Dealers, Inc., 336 F.3d 1373, 1381 (Fed.
Cir. 2003).
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different and separate guarantee order book for each pennissioned pair."
Independent claim 15 contain similar language.
Although we and the Examiner describe, at different levels of
abstraction, to what the claims are directed, it is recognized that "[a]n
abstract idea can generally be described at different levels of abstraction."
Apple, Inc. v. Ameranth, Inc., 842 F.3d 1229, 1240 (Fed. Cir. 2016). That
need not and, in this case does not, "impact the patentability analysis." See
id. at 1241.
In this case, as in Alice, we need not labor to delimit the precise
contours of the "abstract ideas" category. It is enough to recognize that
there is no meaningful distinction in the level of abstraction between the
concept of "creat[ing] electronic records, track[ing] multiple transactions,
and issu[ing] simultaneous instructions," Alice, 134 S. Ct. at 2359, and
creating order books and routing permissions, receiving guarantee orders,
populating the order books, receiving directed orders, and pairing a directed
order with a guarantee order. These are squarely within the realm of
"abstract ideas" as the Court has used that term. See Alice, 134 S. Ct. at
2357; see also Elec. Power Grp., 830 F.3d at 1353-54 (collecting,
analyzing, and displaying information, even when limited to a particular
content, is an abstract idea).
Nonetheless, Appellants argue that the
claimed invention explicitly includes and executes a novel set of
rules that are used to provide novel data handling and automatic
pairing that "focus on a specific means or method that improves
the relevant technology" and that do not preempt all other rules
to achieve the same result deemed patent-eligible in McRO . ...
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(Reply Br. 9, citing McRO, Inc. v. Bandai Namco Games Am. Inc., 837 F.3d
1299, 1313 (Fed. Cir. 2016).) We disagree.
In McRO, the court determined that
the claimed improvement here is allowing computers to produce
"accurate and realistic lip synchronization and facial expressions
in animated characters" that previously could only be produced
by human animators. As the district court correctly recognized,
this computer automation is realized by improving the prior art
through "the use of rules, rather than artists, to set the morph
weights and transitions between phonemes." The rules are
limiting in that they define morph weight sets as a function of the
timing of phoneme sub-sequences.
McRO, 837 F.3d at 1313 (citations omitted). Here, the asserted
improvement is to a business method regarding trading methods, and, in
particular, populating order books. Claims 1 and 15 refer to computers and
processors at only a high level of abstraction, e.g., "wherein the posting
market center includes one or more computers, each computer comprising a
non-transitory memory configured to store instructions for execution by a
processor." (Claim 1.) Indeed, "without the computer limitations nothing
remains in the claim[] but the abstract idea." Bancorp Servs., L.L. C. v. Sun
Life Assur. Co. of Canada (US.), 687 F.3d 1266, 1280 (Fed. Cir. 2012.) In
other words, unlike McRO, claims 1 and 15 recite a set of rules that could be
implemented by hand. Thus, "[ t ]hese claims in substance [are] directed to
nothing more than the performance of an abstract business practice ... using
a conventional computer. Such claims are not patent-eligible." DDR
Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245, 1256 (Fed. Cir. 2014).
Appellants also seek to analogize the present claims to those in
Trading Technologies International, Inc. v. CQG, Inc., 675 F. App'x 1001
(Fed. Cir. 2017). (Reply Br. 3--4.) Appellants argue that "Trading
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Technologies acknowledges that improvements such as speed, accuracy and
usability in a trading system are indeed technical improvements." (Id. at 3,
emphasis omitted.) We disagree.
Claim 1 in Trading Technologies recites, in part,
displaying the bid and ask display regions in relation to fixed
price levels positioned along the common static price axis such
that when the inside market changes, the price levels along the
common static price axis do not move and at least one of the first
and second indictors moves in the bid or ask display regions
relative to the common static price axis.
Trading Techs., 675 F. App'x at 1003. The Federal Circuit agreed with the
district court's determination that "[t]he claims require a specific, structured
graphical user interface paired with a prescribed functionality directly
related to the graphical user interface's structure that is addressed to and
resolves a specifically identified problem in the prior state of the art." Id.
at 1004. The Federal Circuit agreed with the district court that "the
challenged patents solve problems of prior graphical user interface devices
... in the context of computerized trading[] relating to speed, accuracy and
usability." Id. (internal quotations omitted). "The [district] court found that
these patents are directed to improvements in existing graphical user
interface devices." Id.
Here, Appellants do not explain what claim elements solve a problem
of prior graphical user interface devices or improve a graphical user
interface device. Nor do Appellants point to anything in the Specification
disclosing how the claimed invention solves a problem relating to, or
improves upon, a graphical user interface device. Therefore, we do not find
this argument persuasive.
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In view of the above, we agree with the Examiner that claims 1
and 15, and dependent claims 2-14 and 16-21, which are not separately
argued, are directed to an abstract idea. (See Final Action 6-7.)
Step two of the Alice framework has been described "as 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."' Alice, 134 S. Ct.
at 2355 (quoting Mayo, 566 U.S. at 72-73).
The Examiner determines that "[ t ]he additional elements or
combination of elements in the claims other than the abstract idea per se
amount to no more than: (i) mere instructions to implement the idea on a
computer, and/or (ii) recitation of generic computer structure that serves to
perform generic computer functions .... " (Final Action 7.)
Appellants disagree and argue:
The computer efficiencies realized by the claimed
invention are achieved, at least in part, by the claimed posting
market center that is uniquely-configured to create routing
permissions and to automatically pair a directed order with a
guarantee order without searching through all of the guarantee
order books, both of which constitute features that simply do not
exist in any conventional system in this art.
(Appeal Br. 8, emphasis omitted.) But, in claim 1, for example, the "posting
market center" is described in terms of the function performed, i.e., creating,
receiving, populating, and automatically pairing, i.e., matching data. Each
step does no more than require a generic computer to perform routine
computer functions, and "relying on a computer to perform routine tasks
more quickly or more accurately is insufficient to render a claim patent
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eligible." OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1363 (Fed.
Cir. 2015).
Appellants also seek to analogize the present claims to the claims in
DDR Holdings. (Appeal Br. 10.) We disagree. Unlike the present claims,
the claims in DDR Holdings "specify how interactions with the Internet are
manipulated to yield a desired result-a result that overrides the routine and
conventional sequence of events ordinarily triggered by the click of a
hyperlink." DDR Holdings, 773 F.3d at 1258 (emphasis added). In other
words, the invention claimed in DDR Holdings does more than "simply
instruct the practitioner to implement the abstract idea with routine,
conventional activity." See Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709,
715 (Fed. Cir. 2014); see also DDR Holdings, 773 F.3d at 1259.
Taking the claim steps separately, the function performed by the
computer( s) of the posting market center in claim 1 or by the processor( s) in
claim 15, is, at each step, purely conventional. Creating files, receiving data,
populating files with data, and matching data, are basic computer functions.
Additionally, the Specification discloses that the invention can be
implemented using generic computer components. (See Spec. ,r 21.) In
Alice, the Court determined that using "a computer to obtain data, adjust
account balances, and issue automated instructions; all of these computer
functions are 'well-understood, routine, conventional activit[ies]' previously
known to the industry." Alice, 134 S. Ct. at 2359. In other words, each step
in claim 1 and in claim 15 does no more than require generic computer
components to perform routine computer functions.
Considered as an ordered combination, the computer( s) and/ or
processor( s) of Appellants' claimed method add nothing that is not already
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present when the steps are considered separately. The claims do not, as
discussed above, purport to improve the functioning of the computer( s) or
processor(s) themselves. Nor do they effect an improvement in any other
technology or technical field. Instead, the claims at issue amount to nothing
significantly more than an instruction to apply the abstract idea using generic
computer components. That is not enough to transform an abstract idea into
a patent-eligible invention. Id. at 2360.
Nonetheless, Appellants seek to analogize the claims to those in
"Example 21 from the July 2015 Update on Subject Matter Eligibility."
(Appeal Br. 12-13.)
In relevant part, claim 2 in Example 21 recites "[a] method of
distributing stock quotes over a network to a remote subscriber computer"
including the steps of
transmit[ing] the formatted stock quote alert over a
wireless communication channel to a wireless device associated
with a subscriber based upon the destination address and
transmission schedule,
wherein the alert activates the stock viewer application to
cause the stock quote alert to display on the remote subscriber
computer and to enable connection via the URL to the data
source over the Internet when the wireless device is locally
connected to the remote subscriber computer and the remote
subscriber computer comes online.
July 2015 Update Appendix 1: Examples, 3 (2015),
https ://www. uspto. gov/ sites/ default/files/ documents/ieg-july-2015-app 1. pdf;
2014 Interim Guidance on Subject Matter Eligibility (2014 IEG), July 2015
Update: Subject Matter Eligibility, 79 Fed. Reg. 74618 (Dec. 16, 2014).
The Update Appendix explains that
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[t]he claimed invention addresses the Internet-centric challenge
of alerting a subscriber with time sensitive information when the
subscriber's computer is offline. This is addressed by
transmitting the alert over a wireless communication channel to
activate the stock viewer application, which causes the alert to
display and enables the connection of the remote subscriber
computer to the data source over the Internet when the remote
subscriber computer comes online.
(Id. at 4.)
Claim 1 in Example 21 is similar to Claim 2 except that Claim 1 lacks
the stock viewer application; and, thus, does not address "the Internet-centric
challenge of alerting a subscriber ... when the subscriber's computer is
offline." Claim 1 in Example 21 is described as patent ineligible.
Appellants do not argue what step(s) of Appellants' claim 1 or 15 is/are
analogous to the stock viewer application of Claim 2 in Example 21. Nor do
Appellants argue why Appellants' claims 1 and 15 are more analogous to
Claim 2 than to Claim 1 in Example 21. We do not find Appellants'
arguments persuasive.
Appellants also argue that
the functions of creating routing perm1ss10ns, automatically
pairing a directed order and a guarantee order resulting in a
different and separate guarantee order book for each permissions
pair, and eliminating a need to search through all of the guarantee
order books are completely novel and unconventional in this
space insofar as it does not occur in any system other than in the
Appellant's [sic] invention.
(Appeal Br. 13, emphasis omitted.) We do not find this argument
persuasive. Even if the claimed techniques are "[g]roundbreaking,
innovative, or even brilliant," that is not enough for patent eligibility. Ass 'n
for Molecular Pathology, 569 U.S. at 591.
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Appellants further argue that "the claims are not directed to an
abstract idea as evidenced by lack of preemption." (Appeal Br. 15, emphasis
omitted.) We do not find this argument persuasive of error.
Preemption is not a separate test. Moreover, "[ w ]here a patent's
claims are deemed only to disclose patent ineligible subject matter under the
Mayo framework, as they are in this case, preemption concerns are fully
addressed and made moot." Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788
F.3d 1371, 1379 (Fed. Cir. 2015). In other words, "preemption may signal
patent ineligible subject matter, [but] the absence of complete preemption
does not demonstrate patent eligibility." Id.
In view of the above, we agree with the Examiner that claims 1-21 are
directed to a judicial exception without significantly more.
DECISION
The Examiner's rejection of claims 1-21 under 35 U.S.C. § 101 is
affirmed.
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)(l )(iv).
AFFIRMED
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