Patents & the Financial Services Industry

Ex parte Rodriguez, (Appeal 2008-000693)

In its Precedential Opinion penned by Allen MacDonald last fall, the Board of Patent Appeals and Interferences weighed in on the use of means-plus-function claims where the specification only discloses a general purpose computer.  In large part, this opinion just applies the Aristocrat Techs. Austl. Pty Ltd. v. Inter. Game Tech., 521 F.3d 1328 (Fed. Cir. 2008) and Blackboard, Inc. v. Desire2Learn Inc., 574 F.3d 1371 (Fed. Cir. 2009) cases, which essentially reiterate that when using a means-plus-function format to claim a programmed computer, the specification must disclose the corresponding structure in the form or a particular algorithm in order to satisfy §112, ¶6.

However, after reading the opinion, I noticed what I thought an interesting §112, ¶1 rejection for lack of enablement, in the alternative.  Essentially, the Board had found that §112, ¶6 applied to certain claim terms (“system configuration generator,” “system builder,” and “simulation verification environment”) but that there was no definite structure (i.e., algorithm) for these elements, and therefore they were indefinite under §112, ¶2.  Yet, the board went on to say that even “if § 112, sixth paragraph does not apply to these claim limitations, then we make an alternative rejection of [the] claims . . . for lack of enablement under 5 112, first paragraph because the claim elements are purely functional.”

I found the following discussion of what constituted “purely functional” claim language a rather useful claim drafting refresher, and it’s worth a read of the entire opinion if you have the time:

Scope of Enablement

Section 1 12 requires that the patent specification enable “those skilled in the art to make and use the full scope of the claimed invention without ‘undue experimentation’ ” in order to extract meaningful disclosure of the invention and, by this disclosure, advance the technical arts.

 . . .

 

Undue Experimentation - Wands Factors

Whether undue experimentation is needed is not a single, simple factual determination, but rather is a conclusion reached by weighing many factual considerations…

The Wands factors include:

      (1) the quantity of experimentation necessary,

      (2) the amount of direction or guidance presented,

      (3) the presence or absence of working examples,

      (4) the nature of the invention,

      (5) the state of the prior art,

      (6) the relative skill of those in the art,

      (7) the predictability or unpredictability of the art, and

      (8) the breadth of the claims. 

. . .

 

 Functional Claiming versus 35 U.S. C. § 112, sixth paragraph

35 U.S.C. 5 112, sixth paragraph, when enacted, was a statutory response to the Supreme Court’s decision in Halliburton Oil Well Cementing Co. v. Walker, 329 U.S. 1 (1946). In Halliburton, the Supreme Court held invalid an apparatus claim on the ground that it used “means-plus-function” term which was purely functional. Such a claim was improper because the means term with a stated function merely described a particular end result, did not set forth any specific structure, and would encompass any and all structures for achieving that result, including those which were not what the applicant had invented.

 . . .

 

 Functional Language In and Of Itself

We recognize that functional language does not, in and of itself, render a claim improper. . . [E]ven though the claim at issue recited the desired property of the composition in functional terms, the claim nonetheless tied that functional language to a definite structure. . .  [T]he scope of the functional claim language of claim 1 is so broad and sweeping that it includes all structures or means that can perform the function. It is not limited to any corresponding structure, material, or act disclosed in the specification and equivalents thereof.

 . . .

 

 § 112(1) Rejection Analysis

In the present case, as discussed supra, we are presuming that despite the lack of structure in the claims, it is not proper to perform claim construction under 112, ¶ 6 paragraph. That is, the “system configuration generator configured to generate,” “system builder configured to (i) build . . . and (ii) generate,” and “simulation verification environment configured to verify” elements of claim 1 do not require claim interpretation under 5 112, sixth paragraph.10 As such, the result would be that these three elements are each a functional recitation in that there is no structure presented in the claim element itself, and we are not required to import structure from the Specification into the claim under 35 U.S.C. 5 112, sixth paragraph. These claim elements are purely functional. . . [I]n this case and those like it, the purported “structures” in the claims are essentially black boxes not connoting any structure to the skilled artisan, and are merely circularly defined by their desired functions.

Obviously the Board found that these “black box” structures were not enabled and were therefore properly rejected under § 112, ¶ 1 under this alternative theory.  Again, the opinion is worth a read, if for no other reason to see the Board’s discussion of whether a “system builder” is a term that “has achieved recognition as a noun denoting structure.”  Answer Hint: I wouldn’t try using it in any claim that you’re drafting.

Ex parte Sundel, (Appeal 2008-004541)

Like a good novel, this case seems to have it all: a computer-implemented process facing rejections under 35 U.S.C. §§ 112 ¶ 1, 112 ¶ 2, 101 (utility), 101 (non-statutory subject matter), and 103.  The Board reversed each of these rejections, but it entered a new ground of rejection under 35 U.S.C. § 112 ¶ 2, asserting that the means-plus-function claims are indefinite because the specification failed to disclose any algorithms to adequately describe sufficient corresponding structure.

The application is assigned to WorldPak, Inc., and the claims are directed to a shipping method and system for facilitating shipments and shipment management through one of a multitude of shipping mechanisms.

The Board looked at representative claim 33, which invokes numerous “means” clauses, and applied the standard 2-part test for construing means-plus-function claim language: first, define the particular function of the claim, and second, look to the specification and identify the corresponding structure.  It is the second step where, according to the Board, the claim fails.

In short, the Board reviewed the record and found that the specification fails to disclose algorithms corresponding to the functions recited in claim 33.  However, the Board also acknowledged that an algorithm may be expressed in a variety of ways in a specification to provide the necessary structure to comply with § 112, 6th paragraph; e.g., as a mathematical formula, as a flow chart, even in prose or in any other manner that provides sufficient structure for one of ordinary skill in the art to perform the functions. See Finisar Corp. v. DirecTV Group, Inc., 523 F.3d 1323, 1340-41 (Fed. Cir. 2008).

But here the Board did not find any disclosure expressing algorithms corresponding to the recited functions in claim 33.  Therefore, because the programming necessary for one of ordinary skill in the art to perform the functions recited in claim 33 was not provided, the Board found that claim 33 and its dependents are indefinite under 35 U.S.C. § 112 ¶ 2.

Drafting Tips:  The Board also reviewed the pertinent discussions for computer-enabled means-plus-function language:

For computer-implemented means-plus-function claims where the disclosed structure is a computer programmed to implement an algorithm, “the disclosed structure is not the general purpose computer, but rather the special purpose computer programmed to perform the disclosed algorithm.” WMS Gaming, Inc. v. Int’l Game Tech., 184 F.3d 1339, 1349 (Fed. Cir. 1999).

Simply reciting “software” without providing some detail about the means to accomplish the function is not enough. See Aristocrat Techs. Austl. Pty v. Int’l Game Tech., 521 F.3d 1328, —- (Fed. Cir. 2008) (“For a patentee to claim a means for performing a particular function and then to disclose only a general purpose computer as the structure designed to perform that function amounts to pure functional claiming. Because general purpose computers can be programmed to perform very different tasks in very different ways, simply disclosing a computer as the structure designated to perform a particular function does not limit the scope of the claim to ‘the corresponding structure, material, or acts’ that perform the function, as required by section 112 paragraph 6.”)

Without any corresponding structure, one of skill simply cannot perceive the bounds of the invention. Finisar Corp. v. DirecTV Group, Inc., 523 F.3d 1323, 1340-41 (Fed. Cir. 2008).

When a Specification discloses no algorithm corresponding to a computer-enabled means-plus-function limitation in a claim, an applicant has necessarily failed to particularly point out and distinctly claim the invention as required by the second paragraph of section 112. See Ex parte Catlin, 90 USPQ2d 1603 (BPAI 2009) (precedential) (during prosecution, computer-enabled means-plus-function claims will be held unpatentable under 35 U.S.C. § 112, second paragraph, as being indefinite if a Specification fails to disclose any algorithm corresponding to the function in the claims).

“[A] means-plus-function claim element for which the only disclosed structure is a general purpose computer is invalid if the specification fails to disclose an algorithm for performing the claimed function.” See Net MoneyIN, 545 F.3d at 1367.

See also Blackboard, Inc. v. Desire2Learn Inc., No. 2008-1368, slip op. at 21 (Fed. Cir. July 27, 2009), finding Blackboard’s means-plus-function claims indefinite because the patent describes an undefined component, i.e., a black box, that performs the recited function but does not disclose how the component performs the function.

Ex parte Bodin et al., (Appeal 2009-002,913)

In a somewhat rare occurrence, the Board of Patent Appeals and Interferences reversed an Examiner’s § 101 rejection.  The Board reversed the Examiner’s finding that a claim to a computer program product, wherein various means-plus-function elements are recorded upon a recording medium, is not statutory.

The claimed technology relates to a virtual camera and method for digital imaging, and the independent claims at issue, claims 17 and 21, recite the following:

17.  “[a] computer program product for digital imaging, the computer program product comprising:

a recording medium;

means, recorded on the recording medium, for creating, in the virtual camera, an unedited image request for an unedited digital image.”

21.  “[a] computer program product for digital imaging, the computer program product comprising:

a recording medium;

means, recorded on the recording medium, for identifying a browsing image request data element from among image request data elements of an image request data structure.”

Although the recited computer program product includes a recording medium, the Examiner found that the claims are non-statutory under 35 U.S.C. 101 because the claim is directed to the computer program product itself which is not embodied on a computer readable medium.  The Appellants argued that the computer program product expressly includes “a recording medium” and various means-plus-function clauses and that the means is “record[ed] on the recording medium for digital imaging.”

In its decision, the Board framed the matter as follows: “The issue thus turns on whether the Examiner properly determined that ‘recorded on the recording medium’ as it is recited in independent claims 17 and 21 is not the same as including ‘recorded on a computer-readable medium’ in the preamble of the claim.” 

The Board sided with the Appellant and reversed the Examiner’s decision.  As it turns out, the Appellant may have been saved by the fact that its Specification provided specific, physical examples of the computer program product: diskettes, CDs, and DVDs –

Computer programs and data structures are deemed “functional descriptive material,” which impart functionality when employed as a computer component. When functional descriptive material is recorded on some computer-readable medium, it becomes structurally and functionally interrelated to the medium and will be statutory in most cases since use of technology permits the function of the descriptive material to be realized.

 

Appellants disclose that their “invention may be embodied in a computer program product, such as a diskette or other recording medium, for use with any suitable data processing system”. In the alternative, Appellants disclose that the recording medium may be “a CD or DVD”. By definition, a diskette, CD, and DVD are computer-readable mediums. Hence, we find that the “recording medium” as disclosed in the Specification is equivalent to a computer-readable medium.

 

We therefore find that the Examiner has not met the burden of proof to prove that independent claims 17 and 21 are directed to nonstatutory subject matter, since the claim and Specification disclose the computer program recorded on a computer-readable medium.

 

Thus, since Appellants’ independent claims 17 and 21 are limited to being recorded on a computer-readable medium such as a diskette, CD or DVD, we reverse the Examiner’s rejection of independent claims 17 and 21 under 35 U.S.C. § 101 as being directed to nonstatutory subject matter, as well as that of dependent claims 18, 19, 20, 22, 23, and 24.

Ex parte Lawrence, (Appeal 2008-004133)

That Board affirmed the Examiner’s finding of obviousness in a financial services-related application.

U.S. Publication No. 20020138407 recites an invention for a method and system of facilitating the identification, investigation, assessment and management of legal, regulatory financial and reputational risks.

Claim 1 recites:

A computer-implemented method for managing risk related to a financial transaction, the method comprising:

gathering data into a computer storage, the data related to risk variables for a financial transaction;

receiving information into the computer storage relating to details of a financial transaction;

structuring the received information with a processor, according to a risk quotient criteria associated with at least one of a legal, regulatory, and reputational risk; and

generating with the processor, a risk quotient comprising at least one of a scaled numeric value and a scaled alphanumeric value based on the structured information and the gathered data.

At issue is whether one of the cited references (Basch), which is singularly concerned with financial risk, renders obvious the claim limitation of legal risk.  Appellants argued that one of ordinary skill in the art would not be lead by Basch (financial risk) to add another type of risk thereto (legal risk).  The Board disagreed, finding that “we see nothing unexpected from combining a consideration of legal risk that financial institutions are faced with to the calculation Basch conducts to manage the financial risk of a transaction. Adding legal risk to that calculation leads to a rating that accounts for a financial transaction’s financial impact as well as the legal one.”

The Board reasoned:

There appears to be no dispute that Basch discloses a system for managing financial risk of a financial transaction. See App. Br. 7 (“Basch is so specific and unambiguous regarding the direct and limited application of the methods and systems therein to financial risk [. . .] .”)

 

Also, there can be no dispute that a legal risk is a type of risk financial institutions are not only aware of but a factor in assuring their operations comply with the law. FF 3.

 

The question is whether it would have been obvious to one of ordinary skill in the art to add a legal risk as an additional factor for Basch’s system to consider in structuring information to manage the risk of a financial transaction. We find that it would have been.

 

Adding consideration of a legal risk of a financial transaction to the financial risk that Basch’s system addresses yields, as expected, a system which manages not only the financial risk of a transaction but a legal one as well.

The Board did not opine on how financial risks, which are readily and often quantified for analysis, are predictably combinable with legal risks, which are not as commonly quantified and structured for generating a risk quotient.

Ex parte Daughtrey, Appeal 2008-000202 (BPAI, 7/31/2009)

The Board of Patent Appeals and Inferences just revisited a significant §101 issue in Ex parte Daughtrey.  Whereas the Board previously found that the phrase “computer-readable medium” encompasses signals, even though the specification was silent on the issue, it more recently reversed itself and declined to adopt such a broad definition when the Appellant clearly states that he did not intend the phrase to include signals.

As background, U.S. Publication No. US 20030018500 is assigned to ITA Software, an airline IT and services provider, and the claims are generally directed towards producing fare rule summaries.  On April 8, 2009, the Board found, inter alia, that claims 19-27 and 36-39 were unpatentable as being directed to patent ineligible subject matter.  At issue was whether the claims’ recitation of a “computer readable medium” reads on a “signal”; if the claims cover material not found in any of the four statutory categories it is outside the scope of §101, and a transitory, propagating signal is not within any of the four categories. In re Nuijten, 500 F.3d 1346 (Fed.Cir.2008), cert. denied.

In other cases where the phrase “computer-readable medium” appears in the claims, the Board tries to determine whether the phrase reads on unpatentable signals, including reviewing the application’s specification.  Where the specification indicates that the “computer-readable medium” may include a signal embodied in a carrier wave the Board has found the claims unpatentable. See, e.g., Ex parte Salesin, Appeal 2008-002578 (2009).

In this case, both independent claims 19 and 36 recite “A computer program product residing on a computer readable medium,” but the specification does not define “computer readable medium” or otherwise indicate whether it includes signals.  Despite that fact that the specification did not state that a “computer-readable medium” included signals, the Board asserted that the phrase “computer readable medium” was typically used in the computer arts at the time of Appellant’s invention to cover both tangible media as well as signals and invalided the claims:

The phrase “computer readable medium” is not defined or discussed in the Appellant’s Specification. The Specification refers only generally to a storage media (Spec. 4:17) and uses the term, “computer readable medium,” only in original claim 19. The phrase “computer readable medium” was routinely used in the computer arts at the time of Appellant’s invention to refer to both tangible and intangible media. In particular, “computer readable medium” was conventionally used at the time of the invention as a term of art to refer to intangible computer readable media including “transmission” media and carrier waves embodied in electrical, electromagnetic, infrared, or optical signals, or any other media from which a computer can read. Giving claims 19 and 36 the broadest reasonable interpretation in light of the Specification and in light of the meaning of “computer readable medium” in the art, these claims are broad enough to encompass a signal.

(emphasis added) Ex parte Daughtrey, Appeal 2008-000202 (BPAI, 4/8/2009).  In support of these conclusions, the Board cited two U.S. patents that described “computer readable mediums” as covering, inter alia, remote transmissions and carrier waves, and the Board indicated that it reviewed the USPTO EAST database, which showed that “there are more than 2,400 distinct patents and published applications, filed before Appellant’s priority date, which defined “computer readable medium (or media)” as inclusive of either a “transmission medium (or media)” or a “carrier wave.” As of today that number is greater than 24,000.” Id.

The Board concluded that because claims 19-27 and 36-39 cover at least one embodiment that is directed to subject matter that is unpatentable under §101, claims 19-27 and 36-39 are unpatentable as being directed to non-statutory subject matter.

The potential pitfall for practitioners is that the commonly-used claim phrase “computer-readable medium” may cause claims to be invalid or unpatentable even if the inventors and practitioners had no intention of the phrase reading on signals.

In its request for rehearing, Appellants argued the following:

(A)  The Board based its finding only on two prior art citations that purport to cover non-statutory embodiments directed to a signal and the Board’s review of the database of U.S. Patents; the Board did not furnish Appellant any other information, such as queries used by the Board or any contrarian information that could have revealed a difference of opinion in the patent field regarding the definition of “computer-readable medium”, or any information regarding how many patents or applications did not include “transmission medium (or media)” or “carrier wave” as part of a computer readable medium.

(B)  Appellant conducted its own searches of U.S. patents and found 101,181 published applications that included “computer readable medium” but without mentioning “carrier wave,” and found 118,843 published applications including “computer readable medium” without mentioning “transmission medium/media.”

(C)  The Board committed reversible error because there are far more applications that do not define “computer readable medium” in the manner urged by the Board, the Board’s findings are not supported by substantial evidence or preponderance of the evidence, and because the Board did not consult any authoritative sources such as dictionaries or industry publications to support its contention that persons of ordinary skill in the art working in computer fields would consider computer readable media as including a carrier wave or a transmission media.

(D)  The Board has not shown that “transmission medium (or media)” or a “carrier wave” are in fact “computer readable” because Appellant has did not describe any structure that permits a computer to read a carrier wave or a transmission medium.

In its Decision on Request for Rehearing, the Board capitulated and withdrew its § 101 rejections to claims 19-27 and 36-39.  Ex parte Daughtrey, Appeal 2008-000202 (BPAI, 7/31/2009).  Specifically, the Board reconsidered its definition of “computer readable medium” and found it was “imprudent”:

Upon reconsideration, we realize that our approach to defining “computer readable medium” based on its usage in contemporaneous patents was imprudent. Based on the evidence provided by the Appellant in the Request, it does not appear that “computer readable medium” had any commonly-recognized understanding in the art at the time of Appellant’s invention. As such, we decline to adopt a definition of the phrase “computer readable medium” that broadly includes signals, when the Appellant has clearly stated on the record that he did not intend the phrase to include signals. Request 8 (“Appellant neither actively nor passively sought to encompass ‘transmission medium (or media)’ or ‘carrier wave’ within the meaning of computer readable medium”). Accordingly, we withdraw our rejection of claims 19-27 and 36-39 under 35 U.S.C. 5 101.

Blackboard Inc. v. Desire2Learn Inc., Fed. Cir., No. 2008-1368, 7/27/09).

Earlier this week the Federal Circuit invalidated all of the claims in Blackboard Inc.’s patent for conducting online courses, determining that all claims were either anticipated or inadequately disclosed.  This case is particularly relevant for computer-implemented processes as the court again revisited the requirements for reciting means-plus-function language to perform algorithm-based functions in a computer system.

Blackboard and Desire2Learn are competitors in online educational courseware.  Blackboard owns U.S. Patent No. 6,988,138, which covers systems and methods for Internet-based education, and asserted the patent against Desire2Learn in 2006.  Independent Claim 1 invoked 35 U.S.C. §112, ¶6 as follows:

1. A course-based system for providing to an educational community of users access to a plurality of online courses, comprising:

a) a plurality of user computers, with each user computer being associated with a user of the system and with each user being capable of having predefined characteristics indicative of multiple predetermined roles in the system, each role providing a level of access to a plurality of data files associated with a particular course and a level of control over the data files associated with the course with the multiple predetermined user roles comprising at least two user’s predetermined roles selected from the group consisting of a student role in one or more course associated with a student user, an instructor role in one or more courses associated with an instructor user and an administrator role associated with an administrator user, and

b) a server computer in communication with each of the user computers over a network, the server computer comprising:

means for storing a plurality of data files associated with a course,

means for assigning a level of access to and control of each data file based on a user of the system’s predetermined role in a course;

means for determining whether access to a data file associated with the course is authorized;

means for allowing access to and control of the data file associated with the course if authorization is granted based on the access level of the user of the system.

The District Court found, inter alia, that independent claim 1 and dependent claims 2-35, which depend from claim 1, were invalid for indefiniteness.  Specifically, the district court held that the specification contained insufficient structure to support one of the means-plus-function limitations found in claim 1 and, by incorporation, in dependent claims 2-35.

On appeal, the particular “means” clause at issue was the “means for assigning a level of access to and control of each data file based on a user of the system’s predetermined role in a course.”  An “access control manager” is briefly mentioned in the Specification, and according to Blackboard the “access control manager” performs the “assigning” function (“means for assigning”) and could be either software or hardware.  Blackboard argued that the “means for assigning” function is “a server computer with an access control manager and equivalents thereof.” The specification describes the “access control manager” as follows:

Access control manager 151 creates an access control list (ACL) for one or more subsystems in response to a request from a subsystem to have its resources protected through adherence to an ACL. Education support system 100 provides multiple levels of access restrictions to enable different types of users to effectively interact with the system (e.g., access web pages, upload or download files, view grade information) while preserving confidentiality of information.

The Federal Circuit determined that the access control manager “is not a description of structure; what the patent calls the ‘access control manager’ is simply an abstraction that describes the function of controlling access to course materials, which is performed by some undefined component of the system. The ACM is essentially a black box that performs a recited function. But how it does so is left undisclosed.”  The Court held that “The specification contains no description of the structure or the process that the access control manager uses to perform the ‘assigning’ function” and affirmed the lower court’s judgment on indefiniteness.

In making this finding, the relevant cases relied upon by the Federal Circuit were:

Aristocrat Technologies Australia Pty Ltd. v. International Game Technology, 521 F.3d 1328, 1331 (Fed. Cir. 2008): The Blackboard Court noted that in Aristocrat the Federal Circuit “addressed the question whether a general reference to ‘a standard microprocessor-based gaming machine with appropriate programming’ constituted a sufficient disclosure of structure to support a claimed function in a means-plus-function claim. We concluded that it did not. First, we explained that ‘[t]he point of the requirement that the patentee disclose particular structure in the specification and that the scope of the patent claims be limited to that structure and its equivalents is to avoid pure functional claiming.’ Without so limiting a claim, we noted, ‘the patentee has not paid the price but is attempting to claim in functional terms unbounded by any reference to structure in the specification.’ We then applied those teachings to the patentee’s assertion that a reference to a general purpose computer could satisfy that standard. We noted that ‘any general purpose computer must be programmed’ and pointed out that relying on such general structure is equivalent to saying ‘that the function is performed by a computer that is capable of performing the function.’ We also considered and rejected the patentee’s assertion that language describing when the computer would perform the function at issue constituted a sufficient description of the structure for performing the function. Such language, we explained, ‘describes an outcome, not a means for achieving that outcome.’ (citations omitted)

Net MoneyIN, Inc. v. VeriSign, Inc., 545 F.3d 1359 (Fed. Cir. 2008): The Blackboard Court further noted that in Net MoneyIN the Federal Circuit “again addressed a patentee’s argument that reference to a computer provides sufficient structure for a claim drafted in means-plus-function form. In Net MoneyIN, the computer was not a general purpose computer; the patentee contended that the reference to a ‘bank computer’ provided sufficient structure to support the function of ‘generating an authorization indicia in response to queries containing a customer account number and amount.’  The patentee argued that ‘a person skilled in the art would know that such a computer would be programmed to compare account data and amount data to those data structures and generate an authorization indicia if credit were available.’ We rejected that argument and explained that when a computer is referenced as support for a function in a means-plus-function claim, there must be some explanation of how the computer performs the claimed function:

To avoid purely functional claiming in cases involving computer-implemented inventions, we have consistently required that the structure disclosed in the specification be more than simply a general purpose computer or microprocessor. Because general purpose computers can be programmed to perform very different tasks in very different ways, simply disclosing a computer as the structure designated to perform a particular function does not limit the scope of the claim to the corresponding structure, material, or acts that perform the function, as required by section 112 paragraph 6. Thus, in a means-plus-function claim in which the disclosed structure is a computer, or microprocessor, programmed to carry out an algorithm, the disclosed structure is not the general purpose computer, but rather the special purpose computer programmed to perform the disclosed algorithm. Consequently, a means-plus-function claim element for which the only disclosed structure is a general purpose computer is invalid if the specification fails to disclose an algorithm for performing the claimed function.

Because there was no disclosed algorithm in that case, we held that the claims were invalid for lack of a sufficient recitation of structure. (citations omitted)

Drafting Tips: The key to drafting 35 U.S.C. § 112 ¶ 6 claims for computer-related inventions that disclose sufficient structure to perform the claimed functions, requires (a) sufficient detail to transform a general purpose microprocessor to a special purpose computer, while remaining cognizant that (b)  § 112 ¶ 6 means-plus-function claims are limited to the structure, material, or acts disclosed in the specification and their equivalents.  This can end up being a balancing act of including enough detail in the specification to provide sufficient structure for the “means” clause but doing so without unduly narrowing the claim scope of the “means” clause, which may be reduced with additional disclosure of the structure in the specification.

Moreover, it is critical to recognize the distinction between the level of detail that would enable ordinarily skilled artisans to make the invention (which goes to § 112 ¶ 1 enablement) and the level of detail to disclose sufficient structure (which goes to § 112 ¶ 6).  This may appear obvious, but numerous plaintiffs have muddled this distinction in recent years when arguing before the Federal Circuit.  “A patentee cannot avoid providing specificity as to structure simply because someone of ordinary skill in the art would be able to devise a means to perform the claimed function. To allow that form of claiming under section 112, paragraph 6, would allow the patentee to claim all possible means of achieving a function.” Blackboard.

The Federal Circuit has consistently held that claims invoking means-plus-function language for computer-implemented inventions require a specification that discloses a structure more than simply a general purpose computer or microprocessor.  Although not reiterated by the Blackboard Court, in Aristocrat the Federal Circuit explicitly stated that the patentee:

. . . was not required to produce a listing of source code or a highly detailed description of the algorithm to be used to achieve the claimed functions in order to satisfy 35 U.S.C. § 112 ¶ 6.  It was required, however, to at least disclose the algorithm that transforms the general purpose microprocessor to a ‘special purpose computer programmed to perform the disclosed algorithm.

This standard cited WMS Gaming, Inc. v. International Game Technology, 184 F.3d 1339 (Fed.Cir.1999), which held:

A general purpose computer, or microprocessor, programmed to carry out an algorithm creates “a new machine, because a general purpose computer in effect becomes a special purpose computer once it is programmed to perform particular functions pursuant to instructions from program software.”

. . .

In a means-plus-function claim in which the disclosed structure is a computer, or microprocessor, programmed to carry out an algorithm, the disclosed structure is not the general purpose computer, but rather the special purpose computer programmed to perform the disclosed algorithm.

Merely including language in the Specification that the function may be achieved through “any standard microprocessor” machine having “appropriate programming” is insufficient. Aristocrat.

Ex Parte Dickerson, Appeal 2009-001172 (BPAI 2009)

For anyone trying to discern best practices for drafting and prosecuting computer-related claims after In re Bilski, the Board of Patent Appeals and Interferences is making it difficult to find consistent trends.  In this case, the Examiner rejected the claims under 35 U.S.C. § 101 as being directed to non-statutory subject matter.  The claims recited an invention for a method and system for increasing the business value of a company in an industry by identifying a solution based upon its impact and the company’s performance gaps.  The Board reversed all of the § 101 rejections as follows:

The Board found that claims 32 and 33 recite articles of manufacture, which fall into one of the four categories of patent-eligible subject matter.

Claim 32 recites a program product stored on a recordable medium including:

program code configured to receive operational metrics and a set of solutions for application by the industry, wherein the operational metrics include a factor used to measure health or viability of a generic company in the specific industry, wherein the set includes one of a decision, an action, a product, and a service, wherein the specific industry is a grocery store.

 

Claim 33 recites a program product stored on a recordable medium including:

program code configured to receive operational metrics, a set of solutions for application by the industry, operational performance data of the company, and average operational performance data of companies within the industry, wherein the operational metrics include a factor used to measure health or viability of a generic company in the specific industry, wherein the set includes one of a decision, anaction, a product, and a service, wherein the specific industry is a grocery store.

That Board also found that claim 31 recites an apparatus, which is likewise statutory subject matter.

Claim 31 recites a computer system including:

an information system for receiving operational metrics, a set of solutions for application by the specific industry, operational performance data of the company, and average operational performance data of companies within the specific industry, wherein the operational metrics include a factor used to measure health or viability of a generic company in the specific industry, wherein the set includes one of a decision, an auction, a product, and a service, wherein the specific industry is a grocery store industry.

Finally, the Board found that claims 23, 29, and 30 recite a computerized method which includes a step of outputting information from a computer and, therefore, are tied to a particular machine or apparatus.

23. A computerized method for identifying a solution to address exposed performance gaps of a company in a specific industry, comprising:

first identifying a plurality of operational metrics for the specific industry, wherein the operational metrics includes a factor used to measure health or viability of a generic company in the specific industry, wherein the specific industry is a grocery store industry, wherein the operational metrics include at least one of a rate of inventory turnover and a number of customers per day;

assembling a set of solutions for application by the specific industry, wherein the set includes one of a decision, an action, a product, and a service;

assessing impacts of application of the set of solutions on the operational metrics for the specific industry, wherein the assessing includes determining which of the set of solutions has a negative impact on an operational metric and determining which of the set of solutions has a positive impact on the operational metric;

after identifying, assembling, and assessing, then comparing a current operational performance of the company to an operational performance of another company within the specific industry to obtain at least one performance gap, wherein the operational performance includes a performance of a company based upon the operational metric for the specific industry;

identifying a solution based upon the impacts to address the exposed performance gaps, wherein the solution is at least one of a decision, an action, a product, and a service that impacts a problem in a positive manner; and outputting the solution from the computer system.

Ex Parte Guler, Appeal 2009-000415 (BPAI 2009)

The claimed invention is directed towards providing automated decision support for designing auctions and includes a structure extractor using historical auctions for similar items, a bidding behavior predictor based on estimated unknown elements of the auction, and an optimizer.  The Examiner rejected claim 1 as obvious under 35 U.S.C. §103 based on various references.

Claim 1:

A computer-implemented automated decision support system for designing an auction for a given item, comprising:

a structure extractor that estimates unknown elements of market structure of the auction based on auction characteristics data extracted from historical auctions for similar items and a bidding model matching the extracted auction characteristics data;

a bidding behavior predictor that predicts bidding behaviors of bidders in the auction based on the estimated unknown elements of market structure and characteristics of the auction;

an optimizer that employs an evaluation criterion to generate an evaluation of the auction based on (1) the estimated unknown elements of market structure and (2) the predicted bidding behavior of bidders.

The decision turned on whether the one of the cited references disclosed “a bidding model matching the extracted auction characteristics data.”  The Appellant asserted that the reference relied upon by the Examiner for this recitation is not based on a bidding model but instead based on recent trades and/or quotations, and that the reference failed to disclose a bidding behavior predictor that predicts based on “estimated unknown elements of market structure and characteristics of the auction.”  The Examiner asserted that the reference disclosed the claimed “bidding model” and that it would be implicit in the reference because there would be no basis for making any assumptions without a model.

The Board agreed with the Appellants, based largely on a definition in the specification:

We agree with the Appellants. Here, the Specification states that the term “market structure” means substantially the same as “auction environment.” Examples of “market structure” in the auction context are recited in the Specification as “environmental factors or conditions that may affect potential bidders in the actual bidding during the auction” (Spec. 9). Claim 1 requires:

a structure extractor that estimates unknown elements of market structure of the auction based on auction characteristics data extracted from historical auctions for similar items and a bidding model matching the extracted auction characteristics data;

a bidding behavior predictor that predicts bidding behaviors of bidders in the auction based on the estimated unknown elements of market structure and characteristics of the auction; . . . .

(Emphasis added.)

Thus claim 1 requires both: 1) a structure extractor that estimates unknown elements of the market structure based in part on a bidding model, and 2) a bidding behavior predictor that predicts bidding behaviors of bidders based on the estimated unknown elements of market structure (which is based on the bidding model). Thus, the claim requires that the “bidding behavior predictor” must 1) predict bidding behaviors of bidders and 2) be based on a bidding model. The Examiner has determined that Lupien does disclose a bidding model as claimed (Ans. 28). The Examiner has also determined that a bidding model would be implicit in Lupien since there would be no basis for making any assumptions without a model (Ans. 28). However even if such a “bidding model” was implicit in Lupien, it could not also function as the separately claimed limitation of a “bidding behavior predictor.”

Ex Parte Cherian, Appeal 2009-004157 (BPAI 2009)

In an application for an invention relating to creating a computer-usable description of XML message sequencing, the Examiner rejected Claim 1 under 35 U.S.C. §101 as “software per se.”

Claim 1 reads:

A conformance testing system comprising:

a sequence verifier to receive a plurality of messages exchanged between two or more participants and to test conformance of each of the plurality of messages to a specific markup language standard without using a reference implementation of the markup language standard;

wherein the plurality of messages comprises a first message sent from a first participant of the two or more participants to a second participant of the two or more participants and a second message sent from the second participant of the two or more participants to the first participant of the two or more participants.

The Examiner asserted that claims 1 and 5-19 are directed to non-statutory subject matter because they “are nominally directed to a machine/apparatus yet they only claim software not embodied on a computer readable medium.”  The Appellants argued that “[w]hile computers such as conformance testing systems or sequence verifiers may include a compute-readable medium storing executable instructions representing a computer program, nothing in independent claim 1 states or implies that executable instructions or computer programs are being claimed.”

The Board, looking to the specification for clarification, agreed with the Examiner.  The Board found that claim 1 “expressly indicates that the conformance testing system (CTS) includes the sequence verifier,” which the specification explicitly states “is typically embodied by a programmed computer” and “[t]he programmed computer provides the herein-disclosed functionality which may be implemented in hardware and/or software and/or firmware.”  Thus, because claim 1 recites a sequence verifier that reads on software, claim 1 is directed to non-statutory subject matter, and the rejection was sustained.

As an interesting side note, the Appellant asserted, and the Board agreed, that the Examiner failed to provide any explanation for the 35 U.S.C. §101 rejection to claim 20.  Moreover, the Board declined to offer its own rationale for rejection claim 20 under §101, and the Board was persuaded that such rejection was in error.  However, given other recent BPAI decisions, it seems that this Board could have just as easily found a justification to reject claim 20 under §101.

Claim 20:

A method comprising:

receiving a plurality of messages exchanged between two or more participants, the plurality of messages comprising a first message sent from a first participant of the two or more participants to a second participant of the two or more participants and a second message sent from the second participant of the two or more participants to the first participant of the two or more participants; and

testing conformance of each of the plurality of messages to a specific markup language standard without using a reference implementation of the markup language standard.

Ex parte Dang, Appeal 2009-000984 (BPAI 2009)

The application is directed towards a computer-implemented method relating to medical claims, and the only issue on appeal was whether the Appellant established that the Examiner erred by rejecting claim 1 under § 103.  The Examiner cited a single reference as the basis of the § 103 rejection and asserted that the remaining limitations would have been obvious to a person with ordinary skill in the art.

As an initial matter, the Board reversed the Examiner’s obviousness rejection because the Examiner failed to articulate how the prior art rendered obvious one of the claimed features:

Claim 1 specifically requires that the later presented medical claim data fall within the first clean period. This does not occur in Cave. Cave discloses that once the later presented claim is ascertained, a new DEC is formed for it and a new period is started for the associated later presented claim. While the Examiner provides an articulated reasoning for why resetting the new DEC in Cave would be obvious (FF 4,6), the reasoning does not address how the prior art discloses or makes obvious Cave’s mandating a new Dec for the later presented claim. Such a feature relates to a core factual finding determinative of patentability, which needs to be established by a teaching(s) in the prior art. See In re Zurko, 258 F.3d 1379, 1385 (Fed. Cir. 2001).  Accordingly we cannot sustain the rejection of claim 1.

Perhaps a more salient discussion for financial services patents is the Board’s introduction of a new §101 rejection.  Claim 1, which is reproduced below, recites a computer-implemented method for grouping medical claims data and recites a “computer” in the preamble.  The Board first found that there was no “transformation” because the step of “resetting” a time period could be a mental step.  The Board further found that the invention was not tied to a particular machine.  In making this latter finding, the Board noted that although the “computer” was recited in the preamble of the method claim, such limitation is merely a field of use recitation and as such it would only be given weight in accordance with whether it is “intimately meshed with the ensuing language of the claim . . .”  Because the “computer” was not recited in the body of the claim, claim 1 is not tied to a particular machine and is therefore not eligible subject matter.

Claim 1 fails to transform an article into a different state in that it only resets a period which can be a metal step. Second, although the claim preamble recites the method as being computer implemented, we considered it to be merely a field of use recitation, and the weight given it “[depends upon if] that statement is intimately meshed with the ensuing language in the claim. Pitney Bowes, Inc. v. Hewlett-Packard Co., 182 F.3d 1298, 1305-1306 (Fed. Cir. 1999). Since the reference to a computer is not again mentioned in the claim, we find that claim 1 fails to be tied to a particular machine or apparatus. Thus, claim 1 recites non-patent eligible subject matter

The fact that the Board’s decision seemed to turn on the failure to recite the “computer” in the body of the claim would appear to put form over substance, particularly when this could be easily fixed with a very simple amendment to the claim that would not meaningfully affect its scope.  On the other hand, it also provides a good claim drafting reminder about the importance of reciting and incorporating “particular machine” language in the body of method  claims such that they are sufficiently integrated with the claimed steps that it would be difficult for an Examiner or the Board to use the same reasoning as it did in Ex parte Dang to issue or affirm a §101 rejection.

Claim 1 recites:

1. A computer-implemented method for grouping medical claims data, comprising the steps of:

a.    grouping a plurality of medical claim data records to an episode of care having at least one defining characteristic;

b.    assigning a first clean period to the episode of care, the first clean period defined by a predefined time duration during which there is an absence of medical claim data having the at least one defining characteristic of the episode treatment group; and

c.    resetting the first clean period to define a second clean period, the second clean period defining a second predefined time duration, wherein the first clean period is reset to the second clean period when later presented medical claim data having the at least one characteristic of the episode of care and falling within the first clean period is added to the episode of care.