Ex Parte Tucker et al

Patent Trial and Appeal Board

Jun 28, 2018

14095894 (P.T.A.B. Jun. 28, 2018)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE
14/095,894 12/03/2013
758 7590 07/02/2018
FENWICK & WEST LLP
SILICON VALLEY CENTER
801 CALIFORNIA STREET
MOUNTAIN VIEW, CA 94041
FIRST NAMED INVENTOR
Matthew Tucker
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.
30431-24723 1095
EXAMINER
OYEBISI, OJO 0
ART UNIT PAPER NUMBER
3697
NOTIFICATION DATE DELIVERY MODE
07/02/2018 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):
PTOC@Fenwick.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte MATTHEW TUCKER and STEPHEN A. LAIPPLY 1
Appeal2017-000327
Application 14/095,894
Technology Center 3600
Before JOHN A. EVANS, LARRY J. HUME, and JASON M. REPKO,
Administrative Patent Judges.
HUME, Administrative Patent Judge.
DECISION ON APPEAL
This is a decision on appeal under 35 U.S.C. § 134(a) of the Final
Rejection of claims 1-22, which are all claims pending in the application.
We have jurisdiction under 35 U.S.C. § 6(b).
We AFFIRM.
1 According to Appellants, the real party in interest is BlackRock Fund
Advisors. App. Br. 1.
Appeal2017-000327
Application 14/095,894
STATEMENT OF THE CASE2
The Invention
Appellants' disclosed embodiments and claimed invention relate to an
investment funds enabling a bond laddering strategy Spec. ,r 2.
Exemplary Claim
Claim 1, reproduced below, is representative of the subject matter on
appeal ( emphasis added to contested limitations):
1. A method for administering a family of exchange-
traded funds (ETFs) for use in a bond laddering strategy, the
method comprising:
establishing a plurality of open-ended ETFs, each ETF of
the plurality of ETFs having a different liquidation date,
wherein the liquidation dates of the plurality of ETFs are spread
evenly over a time period;
for each of the plurality of ETFs:
receiving, at an order management system
from one or more authorized participants, one or
more creation orders to create new shares of the
ETF,
providing the created shares of the ETF to
the one or more authorized participants, the shares
of the ETF tradable on a secondary market,
determining, by a fund management
information system, a set of distribution payments
and a final liquidation payment for each share of
the ETF,
2 Our decision relies upon Appellants' Appeal Brief ("App. Br.," filed
Jan. 5, 2016); Reply Brief ("Reply Br.," filed Oct. 4, 2016); Examiner's
Answer ("Ans.," mailed Aug. 1, 2016); Final Office Action ("Final Act.,"
mailed Mar. 17, 2015); and the original Specification ("Spec.," filed
Dec. 3, 2013).
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Application 14/095,894
paying the determined distribution payments
to the investors who own shares of the ETF at a
plurality of the intervals before the liquidation date
of the ETF, and
paying the final liquidation payment to the
investors who own shares of the ETF upon the
liquidation date of the ETF; and
closing each of the ETFs based on the
liquidation date of the ETF.
Rejections on Appeal
Claims 1-22 stand rejected under 35 U.S.C. § 101 as being directed to
patent-ineligible subject matter. Ans. 2.
CLAIM GROUPING
Based on Appellants' arguments (App. Br. 4--12), we decide the
appeal of patent-ineligible subject matter Rejection RI of claims 1-22 on the
basis of representative claim 1. 3
ISSUE
Appellants argue (App. Br. 4--12; Reply Br. 1-11) the Examiner's
rejection of claim 1 under 35 U.S.C. § 101 as being directed to patent-
ineligible subject matter is in error. These contentions present us with the
following issue:
3 "Notwithstanding any other provision of this paragraph, the failure of
appellant to separately argue claims which appellant has grouped together
shall constitute a waiver of any argument that the Board must consider the
patentability of any grouped claim separately." 37 C.F.R. § 4I.37(c)(l)(iv).
In addition, when Appellants do not separately argue the patentability of
dependent claims, the claims stand or fall with the claims from which they
depend. In re King, 801 F.2d 1324, 1325 (Fed. Cir. 1986).
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Did the Examiner err in concluding the subject matter of claim 1 is
directed to an abstract idea without significantly more?
ANALYSIS
In reaching this decision, we consider all evidence presented and all
arguments actually made by Appellants. We do not consider arguments
Appellants could have made but chose not to make in the Briefs, and we
deem any such arguments waived. 37 C.F.R. § 4I.37(c)(l)(iv).
We disagree with Appellants' arguments with respect to claims 1-22
and, unless otherwise noted, we incorporate by reference herein and adopt as
our own: ( 1) the findings and reasons set forth by the Examiner in the action
from which this appeal is taken, and (2) the reasons and rebuttals set forth in
the Examiner's Answer in response to Appellants' arguments. We highlight
and address specific findings and arguments regarding claim 1 for emphasis
as follows.
Alice Framework
Section 101 provides that anyone who "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. 35 U.S.C. § 101.
The Supreme Court has repeatedly emphasized that patent protection should
not extend to claims that monopolize "the basic tools of scientific and
technological work." Gottschalkv. Benson, 409 U.S. 63, 67 (1972); Mayo
Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66, 71 (2012);
Alice Corp. Pty. Ltd. v. CLS Bank Int'!, 134 S. Ct. 2347, 2354 (2014).
Accordingly, laws of nature, natural phenomena, and abstract ideas are not
patent-eligible subject matter. Alice, 134 S. Ct. at 2354.
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The Supreme Court's two-part Mayo/Alice framework guides us in
distinguishing between patent claims that impermissibly claim the "building
blocks of human ingenuity" and those that "integrate the building blocks into
something more." Id. (internal quotation marks, citation, and bracketing
omitted). First, we "determine whether the claims at issue are directed to [a]
patent-ineligible concept[]." Id. at 2355. If so, we "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." Id. at
2357 (quoting Mayo, 566 U.S. at 72, 79). While the two steps of the Alice
framework are related, the "Supreme Court's formulation makes clear that
the first-stage filter is a meaningful one, sometimes ending the § 101
inquiry." Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d 1350, 1353 (Fed.
Cir. 2016). We note the Supreme Court "has not established a definitive rule
to determine what constitutes an 'abstract idea"' for the purposes of step one.
Enfzsh, LLC v. Microsoft Corp., 822 F.3d 1327, 1334 (Fed. Cir. 2016) (citing
Alice, 134 S. Ct at 2357).
However, our reviewing court has held claims ineligible as directed to
an abstract idea when they merely collect electronic information, display
information, or embody mental processes that could be performed by
humans. Elec. Power Grp., 830 F.3d at 1353-54 (collecting cases). At the
same time, "all inventions at some level embody, use, reflect, rest upon, or
apply laws of nature, natural phenomena, or abstract ideas." Mayo, 566 U.S.
at 71. Abstract ideas may include, but are not limited to, fundamental
economic practices, methods of organizing human activities, an idea of
itself, and mathematical formulas or relationships. Alice 134 S. Ct. at 2355-
57. Under this guidance we must, therefore, ensure at step one that we
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articulate what the claims are directed to with enough specificity to ensure
the step one inquiry is meaningful. Id. at 2354 ("[W]e tread carefully in
construing this exclusionary principle lest it swallow all of patent law.").
Under the "abstract idea" step we must evaluate "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) (internal citation
omitted). If the claims are not directed to a patent-ineligible concept, the
inquiry ends. See Visual Memory LLC v. NVIDIA Corp., 867 F.3d 1253,
1262 (Fed. Cir. 2017). If the concept is directed to a patent-ineligible
concept, we proceed to the "inventive concept" step. For that second step
we must "look with more specificity at what the claim elements add, in order
to determine 'whether they identify an "inventive concept" in the application
of the ineligible subject matter' to which the claim is directed." Affinity
Labs, 838 F.3d at 1258 (quoting Elec. Power Grp., 830 F.3d at 1353).
Alice Step 1 -Abstract Idea
Our reviewing court has held claims ineligible as being directed to an
abstract idea when they merely collect electronic information, display
information, or embody mental processes that could be performed by
humans. Elec. Power Grp., 830 F.3d at 1353-54 (collecting cases). At the
same time, "all inventions at some level embody, use, reflect, rest upon, or
apply laws of nature, natural phenomena, or abstract ideas." Mayo, 566 U.S.
at 71. Under 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. Alice, 134 S. Ct. at 2354 ("[W]e tread
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carefully in construing this exclusionary principle lest it swallow all of
patent law.").
Appellants contend the Examiner did not "provid[ e] a rationale or
cit[e] to facts on the record ... "but instead "simply conclude[d] that
'administering a family of exchange-traded funds is a fundamental financial
economic practice."' App. Br. 4. In response to the Examiner's conclusion
(Final Act. 3) that "[t]he claims are directed towards the abstract idea of
administering a family of exchange-traded funds", Appellants further allege:
ETFs are neither abstract nor a fundamental economic practice.
Rather, an ETF is a specific type of investment vehicle that
must obey specific rules and is created and redeemed by in-kind
transfers of underlying fund assets by an authorized pailicipant
on a primary market. Further, unlike many other types of
investments-including other funds-ETFs are securitized so they
can be traded in the market on a stock exchange. The process of
"administering a family of ETFs" cannot be a fundamental
economic practice when it encompasses only one specific type
of investment product and when there are so many other way to
invest. See Alice, 134 S. Ct. at 2354 (distinguishing "patents
that claim the 'building blocks' of human ingenuity," from those
"pose no comparable risk of preemption"). Thus, the examiner's
identification of "administering a family of exchange-traded
funds" as being a fundamental economic practice is an error.
App. Br. 6.
In addition, Appellants further allege, " [ u ]nder the standard set forth
in the July Update, fundamental economic practices include 'concepts
relating to the economy and commerce,' such as 'contracts, legal obligations,
and business relations"', and a
fundamental economic practice, as defined by the July Update,
must be "foundational" or "basic." Under this standard, the
[E]xaminer has not demonstrated how the alleged abstract idea
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is foundational or basic to any economic practice. Indeed, an
ETF is just one specific type of financial product offered in the
market, and there are many other ways to invest in a portfolio
of assets. In fact, far from being fundamental, ETFs are not
even a longstanding economic practice; ETFs were first offered
in 1989.
App. Br. 6-7 ( citation omitted). "The Final Office Action thus errs by
failing to explain why the [E]xaminer's proposed abstract idea is directed to
an exception." Id. at 7. 4
In response, the Examiner concluded in the Answer ( 6), "the recited
steps describe the concept of administering a family of exchange-traded
funds, which corresponds to concepts identified as abstract ideas by the
courts, such as formulation and trading of Risk in Alice; and as a result,
claim 1 includes an abstract idea."
4 What arguably is an admission that claim 1 is directed to an abstract idea,
Appellants proffer:
To be consistent with the examples from recent case law, the
Final Office Action should have instead defined the abstract
idea without limiting it to a specific type of investment product.
For example, the Final Office Action could have defined the
abstract idea in more fundamental terms, like "managing
investments for others. " That way, the abstract idea definition
does not scoop up concrete and non-abstract features of the
claimed family of ETFs, such as their ability to be traded on an
exchange. This exchange tradability feature is importantly tied
to a benefit of the claimed subject matter-to make bond
laddering strategies more available to individual investors-and
is thus relevant to the second step of the Alice test, discussed
below. But by including it in the definition of the abstract idea,
the Final Office Action commits reversible error by ignoring
the feature when searching for "something more" in the second
step of the Alice test.
App. Br. 7-8 ( emphasis added).
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Although the Examiner modified the§ 101 rejection in the Answer by
invoking a New Ground of Rejection (see App. Br. 2), apparently to better
conform to more recent USPTO examination guidance, we find the
Examiner's conclusion to be consistent with the Final Action, in which the
Examiner concluded, "[i]n the instant case, the claims are directed towards
the abstract idea of administering a family of exchange-traded funds.
Administering a family of exchange-traded funds is a fundamental financial-
economic practice." Final Act. 3.
Under the "abstract idea" step we must evaluate "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, 838 F.3d at
1257 (citation omitted).
Turning to the claimed invention, claim 1 recites: "A method for
administering a family of exchange-traded funds (ETFs) for use in a bond
laddering strategy." Claim 1 (preamble). Method claim 1 's limitations also
require the steps of:
(a) "establishing ... open-ended ETFs";
and for each of the ETFs,
(b) "receiving ... one or more creation orders to create
new shares"·
'
( c) "providing the created shares of the ETF to the one or
more authorized participants";
( d) "determining, by a fund management information
system, a set of distribution payments and a final liquidation
payment for each share of the ETF;"
( e) "paying the determined distribution payments ... at a
plurality of the intervals before the liquidation date"; and
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(f) "paying the final liquidation payment to the investors
who own shares of the ETF upon the liquidation date of the
ETF."
Under step one, we agree with the Examiner that the inventions
claimed in each of independent claims 1 and 15 are directed to an abstract
idea, i.e., administering a family of exchange-traded funds, which we also
conclude is a fundamental economic practice (see Ans. 3) 5 or, alternatively,
as Appellants suggest, the fundamental economic practice of "managing
investments for others." App. Br. 7.
As for Appellants' argument that "ETFs are not even a longstanding
economic practice; ETFs were first offered in 1989" (id.), we are not
persuaded that an economic practice available for almost 30 years by
Appellants' own admission, does not qualify as a "long-standing" practice
under the broadest reasonable interpretation standard. 6
As the Specification discloses,
5 Merely combining several abstract ideas does not render the combination
any less abstract. RecogniCorp, LLC v. Nintendo Co., 855 F.3d 1322, 1327
(Fed. Cir. 2017) ("Adding one abstract idea (math) to another abstract idea
... does not render the claim non-abstract."); see also FairWarning IP, LLC
v. Iatric Sys., Inc., 839 F.3d 1089, 1093-94 (Fed. Cir. 2016) (determining
the pending claims were directed to a combination of abstract ideas).
6 During prosecution, claims must be given their broadest reasonable
interpretation when reading claim language in light of the Specification as it
would be interpreted by one of ordinary skill in the art. In re Am. Acad. of
Sci. Tech. Ctr., 367 F.3d 1359, 1364 (Fed. Cir. 2004). Under this standard,
we interpret claim terms using "the broadest reasonable meaning of the
words in their ordinary usage as they would be understood by one of
ordinary skill in the art, taking into account whatever enlightenment by way
of definitions or otherwise that may be afforded by the written description
contained in the applicant's specification." In re Morris, 127 F.3d 1048,
1054 (Fed. Cir. 1997).
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[t]his invention relates generally to financial services and
products, and more particularly to financial systems that enable
an investor to create bond laddering strategies, and other
strategies that typically involve individual fixed-income
securities, through a series of open-ended funds (such as
exchange traded funds or mutual funds) that hold fixed-income
securities.
Spec. ,r 2. 7
We conclude this type of activity, i.e., administering a family of
exchange-traded funds (ETFs) for use in a bond-laddering strategy, or
managing investments for others includes longstanding conduct that existed
well before the advent of computers and the Internet, and could be carried
out by a human with pen and paper. See CyberSource Corp. v. Retail
Decisions, Inc., 654 F.3d 1366, 1375 (Fed. Cir. 2011) ("That purely mental
7 See also Spec. 20 ("Abstract"):
An open-ended fund, such as an ETF, holds fixed-income
securities and has a liquidation date. An order management
system receives buy orders from a plurality of investors for
purchasing shares of the fund receives and sell orders from a
plurality of investors for selling shares of the fund. A fund
management information system determines a yield for each
investor based on the shares of the fund purchased by the
investor and the fixed-income securities held by the fund at the
time that the shares were purchased. The fund management
information system also determines a plurality of distribution
payments and a final liquidation payment for each investor so
that the distribution payments and the final liquidation payment
provide the yield determined for the investor when the investor
purchased shares of the fund. This enables investors to use the
fund in a bond laddering strategy.
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processes can be unpatentable, even when performed by a computer, was
precisely the holding of the Supreme Court in Gottschalk v. Benson."). 8
Our reviewing court has previously held other patent claims ineligible
for reciting similar abstract concepts. For example, while the Supreme
Court has enhanced the § 101 analysis since Cy her Source in cases like Mayo
and Alice, they continue to "treat[ ] analyzing information by steps people go
through in their minds, or by mathematical algorithms, without more, as
essentially mental processes within the abstract-idea category." Synopsys,
Inc. v. Mentor Graphics Corp., 839 F.3d 1138, 1146-47 (Fed. Cir. 2016)
(alteration in original) (quoting Elec. Power Grp., 830 F.3d at 1354).
In addition, our reviewing court has concluded that abstract ideas
include the concepts of collecting data, recognizing certain data within the
collected data set, and storing the data in memory. Content Extraction &
Transmission LLC v. Wells Fargo Bank, N.A., 776 F.3d 1343, 1347 (Fed.
Cir. 2014). Additionally, the collection of information and analysis of
information (e.g., recognizing certain data within the dataset) are also
abstract ideas. Elec. Power, 830 F.3d at 1353-54 (collecting information
and "analyzing information by steps people go through in their minds, or by
mathematical algorithms, without more, [are] essentially mental processes
within the abstract-idea category"). Similarly, "collecting, displaying, and
manipulating data" is an abstract idea. Intellectual Ventures I LLC v.
Capital One Fin. Corp., 850 F.3d 1332, 1340 (Fed. Cir. 2017). Further, a
process that employs mathematical algorithms to manipulate existing
8 CyberSource further guides that "a method that can be performed by
human thought alone is merely an abstract idea and is not patent-eligible
under§ 101." CyberSource, 654 F.3d at 1373.
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information to generate additional information is abstract. Digitech Image
Techs., LLC v. Elec.for Imaging, Inc., 758 F.3d 1344, 1351 (Fed.
Cir. 2014). Also, more recently, our reviewing court has also concluded that
acts of parsing, comparing, storing, and editing data are abstract ideas.
Berkeimer v. HP Inc., 881 F.3d 1360, 1367 (Fed. Cir. 2018).
Our reviewing court has explained:
[T]he "realm of abstract ideas" includes "collecting
information, including when limited to particular content."
Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d 1350, 1353
(Fed. Cir.2016) ( collecting cases). We have also "treated
analyzing information by steps people go through in their
minds, or by mathematical algorithms, without more, as
essentially mental processes within the abstract-idea category."
Id. And we have found that "merely presenting the results of
abstract processes of collecting and analyzing information,
without more ( such as identifying a particular tool for
presentation), is abstract as an ancillary part of such collection
and analysis." Id.
FairWarning, 839 F.3d at 1093-94.
As in Fair Warning, the claims here "are directed to a combination of
these abstract-idea categories." Id. Specifically, the claims here recite steps
of establishing a plurality of ETSs, receiving a creation order to create new
shares, providing the created shares of the ETF to authorized participants,
determining distribution payments and final liquidation payment, paying the
distribution payments and final liquidation payment, and closing each of the
ETFs based upon the liquidation date of the ETD. And like in FairWarning,
" [ w ]hile the claims here recite using one of a few possible rules to analyze
the ... data, this does not make them eligible under our decision in McRO,
Inc. v. Bandai Namco Games America Inc., No. 15-1080, 837 F.3d 1299,
2016 WL 4896481 (Fed. Cir. Sept. 13, 2016), which also involved claims
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reciting rules." FairWarning, 839 F.3d at 1093-94. Accordingly, we agree
with the Examiner that claims 1 and 15 are directed to an "abstract idea."
Therefore, in agreement with the Examiner, we conclude claim 1
involves nothing more than administering a family of ETFs- an abstract
idea. See Elec. Power Grp., 830 F.3d at 1354. 9 Accordingly, on this record,
and under step one of Alice, we agree with the Examiner's conclusion the
claims are directed to an abstract idea.
Alice Step 2 -Inventive Concept
If the claims are directed to a patent-ineligible concept, as we
conclude above, we proceed to the "inventive concept" step. For that step
we must "look with more specificity at what the claim elements add, in order
to determine 'whether they identify an "inventive concept" in the application
of the ineligible subject matter' to which the claim is directed." Affinity
Labs, 838 F.3d at 1258 (quoting Elec. Power Grp., 830 F.3d at 1353).
In applying step two of the Alice analysis, our reviewing court guides
we must "determine whether the claims do significantly more than simply
describe [the] abstract method" and, thus, transform the abstract idea into
patentable subject matter. Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709,
715 (Fed. Cir. 2014). We look to see whether there are any "additional
features" in the claims that constitute an "inventive concept," thereby
rendering the claims eligible for patenting even if they are directed to an
abstract idea. Alice, 134 S. Ct. at 2357. For "additional features" to amount
to significantly more than the judicial exception, it is normally not sufficient
9 Merely automating previously manual processing by using computers does
not qualify as an eligibility-rejection-defeating improvement. Credit
Acceptance Corp. v. Westlake Servs., 859 F.3d 1044 (Fed. Cir. 2017).
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for them to be "well-understood, routine, conventional activity." Mayo, 566
U.S. at 79.
We note 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, 881 F.3d at 1368.
Appellants argue the Examiner "ignore[ d] significant features in the
claimed invention, which incorporate unconventional technology to solve
existing problems in the prior art." App. Br. 9. Appellants further contend
prior art ETFs had several limitations and could not be used for bond
laddering. Id.
As made clear in the specification and by the scope of the
claims themselves, the present application does not seek to
preempt or otherwise cover all ways of "administering a family
of exchange-traded funds," limited only to a particular
technological environment. Instead, the claims a recite an order
management system and fund management information system
that employ unconventional techniques to enable a family of
ETFs to be used for bond laddering------an offering that had been
impossible until the claimed subject matter was invented.
App. Br. 10.
Appellants' argument that the claims do not preempt all methods of
administering a family of exchange-traded funds do not make them any less
abstract. See buySAFE, Inc. v. Google, Inc., 765 F.3d 1350, 1355 (Fed.
Cir. 2014) (collecting cases); Accenture Glob. Servs., GmbH v. Guidewire
Software, Inc., 728 F.3d 1336, 1345 (Fed. Cir. 2013); Ariosa Diagnostics,
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Inc. v. Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir. 2015) ("While
preemption may signal patent ineligible subject matter, the absence of
complete preemption does not demonstrate patent eligibility").
Evaluating representative claim 1 under step 2 of the Alice analysis,
we agree with the Examiner that it lacks an inventive concept that
transforms the abstract idea of administering a family of exchange-traded
funds into a patent-eligible application of that abstract idea. See Ans. 6-10.
We agree because, as the Examiner concludes, when considering the
claims as an ordered combination:
The [E]xaminer [concludes] the recited "computing system" is
recited at a high level of generality to simply perform the
generic computer functions of receiving data elements,
determining payment data elements, processing payment data,
and transmitting data elements (i.e., That is, the computer
processor is provided to process certain instructions or data;
input from the user is received to provide an indication of a first
consideration to be applied in the process and to indicate an
expression of interest by the user in certain types of the
descriptive material; a particular display of information is
presented based upon the first consideration and the indication
of expressed interest received; and a provision is made to allow
the user to complete an instance or session of the process).
Thus, generic computer components recited as performing
generic computer functions that are well-understood, routine
and conventional activities amount to no more than
implementing the abstract idea with a computerized system.
Thus, taken alone, the additional elements do not amount to
significantly more than the above-identified judicial exception
(the abstract idea). Looking at the limitations as an ordered
combination of elements add nothing that is not already present
when looking at the elements taken individually. There is no
indication that the combination of the elements improves the
functioning of a computer or improves any other technology.
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Their collective functions merely provide conventional
computer implementation[.]
Id. at 8-9.
Appellants further argue:
[T]he claims incorporate unconventional methods of
"administering a family of exchange-traded funds" is further
supported by [E]xaminer's withdrawal of a previous rejection of
the claims as anticipated by U.S. Patent No. 7,865,426 to
Volpert. Volpert is an issued patent that also discloses various
methods of administering a family of exchange-traded funds.
The withdrawal of the rejection based on Volpert confirms that
the present claims do not cover all ways of "administering a
family of exchange-traded funds," but rather are a departure
from conventional ways of administering ETFs.
App. Br. 11. We disagree with Appellants' contentions.
We disagree because, as the Supreme Court guides, "[t]he 'novelty' of
any element or steps in a process, or even of the process itself, is of no
relevance in determining whether the subject matter of a claim falls within
the § 101 categories of possibly patentable subject matter." Diamond v.
Diehr, 450 U.S. 175, 188-89 (1981). Our reviewing court further indicates
that "even assuming" that a particular claimed feature was novel does not
"avoid the problem of abstractness." Affinity Labs, 838 F.3d at 1263.
As evidence of the conventional nature of the claimed network
components and processes, we note Appellants' Specification discloses, for
example:
[0035] Any of the steps, operations, or processes described
herein may be performed or implemented with one or more
hardware or software modules, alone or in combination with
other devices. In one embodiment, a software module is
implemented with a computer program product comprising a
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Application 14/095,894
computer-readable medium containing computer program code,
which can be executed by a computer processor for performing
any or all of the steps, operations, or processes described.
[0036] Embodiments of the invention may also relate to an
apparatus for performing the operations herein. This apparatus
may be specially constructed for the required purposes, and/or it
may comprise a general-purpose computing device selectively
activated or reconfigured by a computer program stored in the
computer. Such a computer program may be stored in a non-
transitory, tangible computer readable storage medium, or any
type of media suitable for storing electronic instructions, which
may be coupled to a computer system bus. Furthermore, any
computing systems referred to in the [S]pecification may
include a single processor or may be architectures employing
multiple processor designs for increased computing capability.
Spec. ,r,r 35, 36.
Notwithstanding Appellants' arguments above, we agree with the
Examiner that the claim limitations may be broadly but reasonably construed
as reciting conventional computer components and techniques, particularly
in light of Appellants' Specification, as quoted above. 10
Thus, with respect to the Step 2 analysis, we agree with the Examiner
because, as in Alice, the recitation of either a "method for administering a
family of exchange-traded funds (ETFs) for use in a bond laddering
strategy" ( claim 1 ), or a " system for administering an exchange-traded funds
10 During prosecution, claims must be given their broadest reasonable
interpretation when reading claim language in light of the Specification as it
would be interpreted by one of ordinary skill in the art. Am. Acad., 367 F.3d
at 1364. Under this standard, we interpret claim terms using "the broadest
reasonable meaning of the words in their ordinary usage as they would be
understood by one of ordinary skill in the art, taking into account whatever
enlightenment by way of definitions or otherwise that may be afforded by
the written description contained in the applicant's specification." In re
Morris, 127 F.3d 1048, 1054 (Fed. Cir. 1997).
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Application 14/095,894
(ETF) for use in a bond laddering strategy" ( claim 15) is simply not enough
to transform the patent-ineligible abstract idea here into a patent-eligible
invention. See Alice, 134 S. Ct. at 2357 ("[C]laims, which merely require
generic computer implementation, fail to transform [an] abstract idea into a
patent-eligible invention.").
Our reviewing court has held, "the use of generic computer elements
like a microprocessor or user interface do not alone transform an otherwise
abstract idea into patent-eligible subject matter." Fair Warning, 839 F.3d at
1096 (citing DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245, 1256
(Fed. Cir. 2014)).
Accordingly, based upon the findings above, on this record, we are
not persuaded of error in the Examiner's conclusion that the appealed claims
are directed to patent-ineligible subject matter. Therefore, we sustain the
Examiner's § 101 rejection of independent claim 1, and grouped claims 2-
22, not argued separately, and which fall therewith. See Claim Grouping,
supra.
REPLY BRIEF
To the extent Appellants may advance new arguments in the Reply
Brief (Reply Br. 1-11) not in response to a shift in the Examiner's position
in the Answer, we note arguments raised in a Reply Brief that were not
raised in the Appeal Brief or are not responsive to arguments raised in the
Examiner's Answer will not be considered except for good cause (see 37
C.F.R. § 41.41(b)(2)), which Appellants have not shown.
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Application 14/095,894
CONCLUSION
The Examiner did not err with respect to patent-ineligible subject
matter Rejection RI of claims 1-22 under 35 U.S.C. § 101, and we sustain
the rejection.
DECISION
We affirm the Examiner's decision rejecting claims 1-22.
No time period for taking any subsequent action in connection with
this appeal may be extended under 37 C.F.R. § 1.I36(a)(l)(iv). See 37
C.F.R. § 41.50(±).
AFFIRMED
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