Post-Alice Patents in Ecommerce, Banking and Finance

by Fenwick & West LLP
Contact

Where are the post-Alice business method patents?

Between January 1, 2015 and January 23, the USPTO issued 247 patents in class 705, the overall business methods classification.   I reviewed the file histories of every single one of these patents.  I found only four that had post-Alice Section 101 rejections.  Between October 1, 2014 and December 31, 2014 there were 872 class 705 patents issued.  I found none (zero) that had post-Alice rejections.

In both groups, the vast majority had no Section 101 rejections, or if they had any, they were pre-Alice, based on Bilski.  The vast majority of these pre-Alice rejections were made before 2014, some as far back as 2011--and yet the notice of allowances only came in mid or late 2014.  As you likely know, the pre-Alice rejections were easily overcome by adding "processor" limitations to the method claims, and adding "non-transitory" to computer program product claims.

Generally, the rejections themselves were the form paragraphs we've all seen, with little or no specific analysis of the alleged abstract idea, and zero discussion of the limitations of the claims with respect to "inventive concept," or why the claims limitations do not recite "significantly more" than the abstract idea itself. 

On the other hand, the responses varied:

  1. Form rebuttal, the claims are not abstract. 
  2. Failure of examiner to make prima facie case of ineligibility.
  3. Substantive arguments that claims are not abstract and include inventive concepts.
  4. Failure of examiner to make prima facie case, along with substantive arguments that the claims were not abstract and include "inventive concepts."

What follows is a detailed look at each of the cases.

***

The first patent is an example of No. 4, the all-out response.  

8,942,920, "Concepts for determining the accuracy of map data." Assigned to UPS (the folks with the brown delivery trucks.)

Right off the bat, this application is asking to be rejected under Section 101 by putting "concepts" in the title. Patenting concepts is a non-starter. 

1. A method for determining the accuracy of map data, the method comprising:

identifying, via one or more processors, a route for traveling from a first serviceable point to a second serviceable point in a geographic area;

determining, via the one or more processors, an estimated distance for traveling from the first serviceable point to the second serviceable point, the estimated distance determined based at least in part on map data;

determining, via the one or more processors, an actual distance traveled from the first serviceable point to the second serviceable point, the actual distance traveled based at least in part on telematics data collected while a vehicle traveled from the first serviceable point to the second serviceable point; and

determining, via the one or more processors, the accuracy of the map data based at least in part on the difference between the estimated distance and the actual distance,

wherein determining the accuracy of the map data comprises (a) identifying one or more types of travel selected from the group consisting of turn-around travel, break travel, configurable tolerance travel, and duplicate travel and (b) excluding the one or more types of travel.

The rejection was the familiar form paragraph with the statement: "The claims are directed to the abstract idea of determining the accuracy of map data based on the mathematical difference between an estimated distance and an actual difference."

The response runs eight pages, covering the entire spectrum of arguments:

  1. The examiner failed to establish the prima facie case, citing In re Oetiker, and MPEP 2106(III), and failed to provide factual evidence in support of the finding of an abstract idea or that the claim limitations did not qualify as "something more."
  2. The examiner did not consider the claims as a whole.
  3. The claims are not directed to an abstract idea. The drafter even analyzes the historical Supreme Court cases of Le Roy, Rubber-Tip Pencil, and Benson. I don't really see the point in that. 
  4. The claims are not directed to mathematical algorithms.
  5. The claims include "something more" vis a vis improvements to technology, meaningful limitations, new and useful applications.
  6. A final reminder to "tread carefully."

Overall, the arguments are well-crafted, but perhaps a bit of overkill when you consider the next patent, which is an example of No. 1, the form rebuttal.

8,930,067, "System and method for a subscription-based diagnostic software." Assigned to NMTC, Inc.

1. A mobile device, comprising:

a user interface;

a display;

a vehicle data transfer interface; and

a processor coupled to a non-transitory, computer-readable medium having stored thereon computer-executable instructions for a subscription software application for use in maintenance of a vehicle, the subscription software application, when executed by the processor, configuring the processor to:

output, on the display, a catalog of diagnostic software modules available for utilization by a vehicle maintenance technician to analyze vehicle data received by the vehicle data transfer interface;

receive, via the user interface, a selection of a desired diagnostic software module made by the vehicle maintenance technician from among the catalog of diagnostic software modules and a commitment of payment for a subscription to the desired diagnostic software module;

communicate the selection of the desired diagnostic software module and the commitment of payment to a remote system; and

enable operation of the desired diagnostic software module by the vehicle maintenance technician on the mobile device in response to an authorization signal.

The rejection does not even identify the abstract idea at all, but offers this patent law koan: "the claim(s) is/are directed to the abstract idea of an idea itself." 

The response is the old "cancel the claims and replace with new claims" along with a form rebuttal.

Claims 1-30 stand rejected under 35 U.S.C. 101 as being directed to non-statutory subject matter.With the cancellation of claim 1-30, this rejection is rendered moot as to those claims. Moreover, it is respectfully submitted that newly added claims 31-60 incorporate structural elements and functional interactions between them, and are not directed to mere abstract ideas. Thus, claims 31-60 represent statutory subject matter under 35 U.S.C. 101.

That worked!  Not for the faint of heart.   The next one is an example of No. 2, attacking the prima facie case.

8,935,172, "Fulfilling staffing requirements via an interactive voice response system." Assigned to Noble Systems Corp. 

1. A method for fulfilling a portion of staffing requirements using an interactive voice response system (IVR), the method comprising the steps of:

forecasting the staffing requirements for a business activity by at least one computer processor;

identifying the portion of the staffing requirements by the at least one computer processor to be fulfilled using the IVR, the portion of the staffing requirements comprising one or more staff member positions required to be performed for the business activity;

identifying a plurality of eligible staff members that may fulfill the one or more staff member positions by the at least one computer processor;

contacting a first member of the plurality of eligible staff members; upon contacting the first member of the plurality of eligible staff members, requesting the first member of the plurality of eligible staff members using the IVR to fulfill at least one of the one or more staff member positions;

receiving a response from the first member of the plurality of eligible staff members at the IVR indicating whether the first member accepts or denies fulfilling the at least one of the one or more staff member positions;

upon the response indicating the first member of the plurality of eligible staff members accepts fulfilling the at least one of the one or more staff member positions, sending an acceptance from the IVR to the at least one computer processor; and

upon receiving the acceptance, scheduling the first member of the plurality of eligible staff members to fulfill the at least one of the one or more staff member positions by the at least one computer processor. 

Claim 7 is a computer program product claim corresponding to claim 1, and claim 13 is the system claim. The rejections were pure form paragraphs: the examiner did not even identify the alleged abstract idea or provide any explanation of why the claim limitations are not sufficient. 

The response focused entirely on the failure of the examiner to make the prima facie case:

Applicant respectfully points out that "[t]he examiner bears the initial burden ... of presenting a prima facie case of unpatentability." In re Oetiker, 977 F.2d 1443, 1445, 24 USPQ2d 1443, 1444 (Fed. Cir. 1992) and MPEP 2106(III). A proper prima facie case involves the Examiner "providing clear rationale supporting the determination that an abstract idea has been claimed ... " See MPEP 2106(II)(B)(2). Fn. 1 Accordingly, "[i]n making a rejection ... , the examiner should specifically point out the factors that are relied upon in making the determination. Specifically identifying the factors used in the analysis will allow the applicant to make specific arguments in response to the rejection if the applicant believes that the conclusion that the claim is directed to an abstract idea is in error." Id.

Fn. 1: Applicant notes that the memorandum issued by Andrew H. Hirshfeld, Deputy Commissioner for Patent Examination Policy, on June 25, 2014, providing preliminary instructions on how to carry out the two-part analysis for abstract ideas in light of the Supreme Court's recent Alice Corp decision supersedes MPEP 2106(II)(A) and 2106(II)(B). See Memorandum entitled "Preliminary Examination Instructions in view of the Supreme Court Decision in Alice Corporation Pty. Ltd. v. CLS International, et al." Hirshfeld, Andrew H., Deputy Commissioner For Patent Examination Policy, June 25, 2104, Page 2. However, MPEP 2106(III) makes clear that "[t]he examiner bears the initial burden ... of presenting a prima facie case of unpatentability." Therefore, the memorandum's comment that the two-part analysis supersedes MPEP 2106(II)(B) does not negate the Examiner's obligation of presenting a proper prima facie case of unpatentability that involves "providing clear rationale supporting the determination that an abstract idea has been claimed ... "

However, in this instance, the Office Action fails to specifically point out the factors that are relied upon in making the determination that the claims are directed to an abstract idea without including limitations that qualify as significantly more. Firstly, the Office Action simply states "[b ]ased upon consideration of all of the relevant factors with respect to claims 1-18 as a whole, the claims are directed to abstract idea" without even identifying the abstract idea the claims are directed to or the relevant factors considered in reaching this conclusion. Secondly, the Office Action simply states that the "limitations are not enough to qualify as 'significantly more' being recited in the claim[s] along with the abstract idea" without even identifying the specific limitations considered or any support or rationale as to why these limitations are not enough to qualify as "significantly more." Thus, the Office Action fails to provide any clear rationale supporting the determination that Claims 1-18 are directed to an abstract idea without including limitations that are enough to qualify as "significantly more" than the abstract idea itself. As a result, Applicant is not afforded an opportunity to make specific arguments in response to the rejection.

Thus, as shown above, the Office Action fails to present a proper prima facie case of unpatentability with respect to Claims 1-18 being directed to an abstract idea. Accordingly, the rejection of Claims 1-18 as being directed to non-statutory subject matter because the claims are directed to an abstract idea is improper and should be withdrawn. 

Given the paucity of the rejection, the response argument was targeted and successful.

Finally, we have an example of No. 2, arguing the merits of the Mayo test. 

8,930,235, "Shelf space product placement optimizer." Assigned to Oracle International.

Claim 8 is the exemplary method claim.

8. A computer-implemented method for optimize shelf space placement for an item in a store, the method comprising:

receiving input decision variables and constraints;

executing a Randomized Search (RS) using the input decision variables and the constraints until an RS solution is below a predetermined improvement threshold, wherein the RS solution comprises first RS solution decision variables;

solving a Mixed-Integer Linear Program (MILP) problem using the first RS solution decision variables and the constraints, wherein the RS solution is a starting point of the solving to generate a MILP solution by transforming the first RS solution decision variables into MILP decision variables;

when the MILP solution is not within a predetermined accuracy or does not exceed a predetermined time duration, alternating executing a second RS based on the previous MILP solution until a second RS solution comprising second RS solution decision variables is below the pre-determined improvement threshold and solving the MILP problem by transforming the second RS solution decision variables into MILP decision variables, until the MILP solution is within the predetermined accuracy or does exceed the predetermined time duration; and

based on the MILP solution, outputting a shelf position and a number of facings for the item. 

The rejection here had the most detail--but was still very thin:

Claims 1-20 are rejected under 35 U.S.C. 101 because the claimed invention is directed to non-statutory subject matter because the claims as a whole, considering all claim elements both individually and in combination, do not amount to significantly more than an abstract idea.

Claims 1-20 are determined to be directed to the abstract idea of a mathematical relationship or formula. The additional elements or combination of elements in the claims other than the abstract idea per se amount to no more than mere instructions to implement the idea on a computer and/or a recitation of generic computer structure that serves to perform generic computer functions that are well-understood, routine and conventional activities previously known to the pertinent industry. Viewed as a whole, these additional claim elements do not provide meaningful limitations to transform the abstract idea into a patent eligible application of the abstract idea such that the claims amount to significantly more than the abstract idea itself. Therefore, the claims are rejected under 35 U.S.C. 101 as being directed to non-statutory subject matter. The rationale for this determination is explained below: The claims are directed to the use of "the use of a linear programming which is a mathematical method for optimizing a solution to an equation given a set of constraints" using a generic computer system. See Supreme Court Decision Alice Corporation Pty. Ltd v. CLS Bank International, et al. ("Alice Corp").  (Emphasis added).

The Examiner's identification of the alleged abstract idea as a "mathematical relationship or formula" or the use of linear programming is only half correct.  Claims to mathematical algorithms are ineligible when they are directed a pure mathematics:  algorithms and formulas that solve purely mathematical problems, rather than applied mathematics solving specific "real world" problems.  The claims in Benson, for example, were believed by the Court, (incorrectly, but that's another matter) to be directed to the pure math behind converting binary-coded decimal to binary.  Similarly, in Flook, the Court noted that there were no details in the specification of how the specific variables were derived, leaving the claim thus directed to the equation itself, as opposed to its application.  

Thus, the Examiner did not take the analysis far enough.  Other than the preamble and the very last step of the claim, there is nothing to bind the use of the mathematical algorithm to the specific application, and as a result the claim does not recite a practical application of the underlying mathematical algorithms.  

Here are the responsive arguments:

Claims 1-20 are rejected under 35 U.S.C. §101 because the claims are "are determined to be directed to the abstract idea of a mathematical relationship or formula" consistent with the "Alice Corp." decision. Further, claims 15-20 are rejected under 35U.S.C. §101 because the limitations recite a system per se. In response, claim 15 has been amended to recite physical structural elements.

In accordance to the "June 25, 2014 Memorandum to the Examining Corps: Preliminary Examination Instructions in view of the Supreme Court Decision in Alice Corporation Pty. Ltd. v. CLS Bank International, et al.", "Part 1" is to determine if the claim is directed to an abstract idea. Applicants disagree that, for example, claim 1 is directed to an abstract idea. Although claim 1 does recite mathematical relationships, the Office Action ignores the other meaningful limitations. For example, the result of claim 1 is to output "a shelf position and a number of facings for the product" which can be considered a tangible non-abstract outcome.

Further, even if the claims are considered an abstract idea, in accordance with "Part 2" of the June 25, 2014 Memorandum, if "significantly more" is recited in the claim with the abstract idea, the abstract idea is eligible manner. For at least two reasons, the claims of the present application recite significantly more. For one, as previous discussed, the output of "a shelf position and a number of facings for the product" in order to "optimize shelf space placement" is significantly more than the mere execution of mathematical algorithms. Further, the recited limitations, in which the RS solution is used as an input to a MILP problem, and the MILP solution is used as an input to an RS, provides "improvements to the functioning of the computer itself." For example, the present specification discloses that: "At 306, the solution of the RS algorithm is used as starting point of a MILP solver to speed up its performance. In other words, the RS algorithm solution is converted to a MILP solution." See specification at [0074] (emphasis added).  Based at least on the foregoing, Applicants respectfully requests that the 35 U.S.C. §1 01 rejection be withdrawn. 

The argument that the output is a shelf position and number of facings is very thin, since there's nothing in the claim that indicates how that position and number relates to the MILP and RS calculations: the claim only describes "input decision variables and conditions." What are these? The Examiner could have definitely gone final on this rejection.  

But instead, not only was this approach successful, the examiner's reasons for allowance adopted the applicant's argument verbatim, and then helpfully added (with initial caps):

The Claims are Allowable because the Prior Art Fails to Disclose Outputting a Shelf Position and a Number of Facings for a Product as a Result of Alternating an RS and an MILP, and Using Solutions of Each as Decision Variables of the Other.

Thus, the Examiner nicely coupled the "non-conventional" aspects of the claim to the eligibility analysis.  This should provide some additional support for the eligibility argument, should the patent ever be challenged.

***

Here's a question:  If the Examiner can cite as precedent for a subject matter rejection, court decisions dealing with entirely different patents (and different claims) than the patent application before her, can the practitioner cite other issued patents in the same field, as evidence of the eligibility of the claim?  If the argument is a claim is ineligible because it is in the class of abstract ideas, methods of organizing human activities, etc., and the evidence is a Federal Circuit case for a patent in that same class, then equally probative are post-Alice patents to the same type of invention. What's sauce for the ineligibility goose, is sauce for the eligibility gander.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Fenwick & West LLP | Attorney Advertising

Written by:

Fenwick & West LLP
Contact
more
less

Fenwick & West LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.