DETAILED ACTION
Notice of Pre-AIA or AIA Status
The present application, 15/697,799, was filed on Sept. 7, 2017, and claims priority from Provisional Application 62/385,291, filed Sept. 9, 2016. The effective filing date is after the AIA date of March 16, 2013, and so the application is being examined under the “first inventor to file” provisions of the AIA .
In the event the determination of the status of the application as subject to AIA 35 U.S.C. 102 and 103 (or as subject to pre-AIA 35 U.S.C. 102 and 103) is incorrect, any correction of the statutory basis for the rejection will not be considered a new ground of rejection if the prior art relied upon, and the rationale supporting the rejection, would be the same under either status.
Status of the Application
A request for continued examination under 37 CFR 1.114, including the fee set forth in 37 CFR 1.17(e), was filed in this application after final rejection. Since this application is eligible for continued examination under 37 CFR 1.114, and the fee set forth in 37 CFR 1.17(e) has been timely paid, the finality of the previous Office action has been withdrawn pursuant to 37 CFR 1.114. Applicant's submission filed on Dec. 15, 2025 has been entered.
This Non-Final Office Action is in response to Applicant’s amendment filed on Dec. 15, 2025.
Claims 1, 4-6, 11-15, and 18-24 are pending, of which claims 1, 19, and 20 are independent.
In the present amendment, the independent claims 1, 19, and 20. Claims 2, 3, 7-10, 16, and 17 were previously cancelled, claims 21 and 22 were previously added, and claims 23 and 24 are newly added.
All pending claims have been examined on the merits.
Information Disclosure Statement
The Information Disclosure Statement (IDS) submitted on 12/15/2025 has been considered.
Claim Rejections - 35 USC § 112
The following is a quotation of the first paragraph of 35 U.S.C. 112(a):
(a) IN GENERAL.—The specification shall contain a written description of the invention, and of the manner and process of making and using it, in such full, clear, concise, and exact terms as to enable any person skilled in the art to which it pertains, or with which it is most nearly connected, to make and use the same, and shall set forth the best mode contemplated by the inventor or joint inventor of carrying out the invention.
The following is a quotation of 35 U.S.C. 112(b):
(b) CONCLUSION.—The specification shall conclude with one or more claims particularly pointing out and distinctly claiming the subject matter which the inventor or a joint inventor regards as the invention.
Claim 24 is rejected under 35 U.S.C. 112(b), as being indefinite for failing to particularly point out and distinctly claim the subject matter which the inventor or a joint inventor, or for pre-AIA the applicant regards as the invention.
Claim 24 recites the limitation "The non-transitory computer-readable medium" and “the updating”, and “the decentralized network”. There is insufficient antecedent basis for these limitations in the claim.
Claim Rejections - 35 USC § 101
35 U.S.C. 101 reads as follows:
Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.
Claims 1, 4-6, 11-15, and 18-24 are rejected under 35 U.S.C. §101 because the claimed invention is directed to non-statutory subject matter. The claimed invention is directed to an abstract idea, without “significantly more”.
The abstract idea elements in independent claim 1 are shown in regular font. The “additional elements” are shown in underlined font:
1. (Currently Amended) A method comprising:
prior to conducting, at a loan processing subsystem of a loan processor, any interaction with a customer client, obtaining, at a temporary distributed ledger digital asset address of the loan processing subsystem, a pre-loan value of a distributed ledger digital asset from a distributed ledger digital asset network subsystem by updating at least one distributed ledger of a decentralized network;
after obtaining the pre-loan value of the distributed ledger digital asset, receiving, at the loan processing subsystem, a loan request from a first subsystem on behalf of the customer client via an internet communications network, wherein the loan request is for a loan value of the distributed ledger digital asset selected by the customer client from a loan servicing tool of the loan processing subsystem presented by the first subsystem,
wherein the loan servicing tool presents real-time quoting of the loan value in currencies of at least the distributed ledger digital asset and a fiat money asset and an exchange rate therebetween, and wherein the receiving the loan request is conducting an interaction with the customer client;
after receiving the loan request, automatically determining, at the loan processing subsystem, a loan structure for the loan request based on the selected loan value and the customer client and a merchant,
wherein the determining comprises guaranteeing, at the loan processing subsystem, that a deposit has been made, after obtaining the pre-loan value of the distributed ledger digital asset, on behalf of the customer client based on the selected loan value, and wherein the loan structure comprises information indicative of the customer client and the guaranteed deposit;
recording the information indicative of the customer client and the guaranteed deposit in the at least one distributed ledger;
after determining the loan structure, transferring at least a portion of the obtained pre-loan value of the distributed ledger digital asset from the temporary distributed ledger digital asset address of the loan processing subsystem to a distributed ledger digital asset wallet of the merchant client subsystem of the merchant by updating the at least one distributed ledger without the intervention of any central authority as at least one loan payout based on the determined loan structure;
linking, at the loan processing subsystem, the recorded information indicative of the customer client and the guaranteed deposit with the otherwise anonymous transferred at least a portion of the obtained pre-loan value of the distributed ledger digital asset; and
after transferring the at least a portion of the obtained pre-loan value of the distributed ledger digital asset, receiving a value of the fiat money asset, at the loan processing subsystem, from at least one of a customer client subsystem on behalf of the customer client or a fiat money asset network subsystem on behalf of the customer client as at least one loan payoff based on the determined loan structure, wherein the first subsystem is at least one of:
a subsystem using an application programming interface ("API") of the loan processor that is integrated into a front end of an application interface provided by the merchant; or
a subsystem using an application programming interface ("API") of the loan processor that is integrated into a front end of an application interface provided by a device of the customer client.
More specifically, claims 1, 4-6, 11-15, and 18-24 recite an abstract idea: “Certain Methods of Organizing Human Activity", specifically “Commercial or Legal Interactions (Including Agreements in the form of Contracts; Legal Obligations; Advertising, Marketing, or Sales Activities or Behaviors; Business Relations)”, as discussed in MPEP §2106(a)(2) Parts (I) and (II), and in the 2019 Revised Patent Subject Matter Eligibility Guidance.
The “Commercial or Legal Interactions” elements include:
“after receiving the loan request, automatically determining … a loan structure for the loan request based on the selected loan value and the customer client and a merchant”.
“wherein the loan structure comprises information indicative of the customer client and the guaranteed deposit”.
“guaranteeing … that a deposit has been made, after obtaining the pre-loan value of the distributed ledger digital asset, on behalf of the customer client based on the selected loan value”.
The “additional” structural elements are: “loan processing subsystem”, “first subsystem”, “a loan servicing tool of the loan processing subsystem presented by the first subsystem”, “loan processor”, “application programming interface”, and “an internet communications network”.
The “additional” extra-solution elements are:
“obtaining, at a temporary distributed ledger digital asset address of the loan processing subsystem, a pre-loan value of a distributed ledger digital asset from a distributed ledger digital asset network subsystem”,
“updating at least one distributed ledger of a decentralized network”,
“receiving, at the loan processing subsystem, a loan request from a first subsystem on behalf of the customer client via an internet communications network”,
“recording the information indicative of the customer client and the guaranteed deposit in the at least one distributed ledger”,
“transferring at least a portion of the obtained value of the distributed ledger digital asset from the temporary distributed ledger digital asset address of the loan processing subsystem to a distributed ledger digital asset wallet of a merchant client subsystem of the merchant”,
“updating the at least one distributed ledger without the intervention of any central authority as at least one loan payout based on the determined loan structure”,
“receiving a fiat money asset, at the loan processing subsystem, from at least one of a customer client subsystem on behalf of the customer client or a fiat money asset network subsystem on behalf of the customer client as at least one loan payoff based on the determined loan structure”,
“present[ing] real-time quoting of the loan value in currencies of at least the distributed ledger digital asset and a fiat money asset and an exchange rate therebetween”, and
“the receiving the loan request is conducting an interaction with the customer client”.
This abstract idea is not integrated into a practical application, because:
The claim recites an abstract idea with additional generic computer elements. The generically recited computer elements (“loan processing subsystem”, “first subsystem”, “a loan servicing tool of the loan processing subsystem presented by the first subsystem”, “loan processor”, “application programming interface”, and “an internet communications network”) do not add a meaningful limitation to the abstract idea, because they amount to simply implementing the abstract idea on a computer. The claim amounts to adding the words "apply it" (or an equivalent) with the abstract idea, or mere instructions to implement an abstract idea on a computer, or merely uses a computer as a tool to perform an abstract idea.
The extra-solution activities (“obtaining”, “updating”, “receiving”, “recording”, and “transferring”) do not add a meaningful limitation to the method, as they are insignificant extra-solution activity;
The combination of the abstract idea with the additional elements (generically recited computer elements), and/or with the extra-solution activities, does not integrate the abstract idea into a practical application.
The claims do not include additional elements that are sufficient to amount to significantly more than the abstract idea, because:
When considering the elements "alone and in combination" (“loan processing subsystem”, “first subsystem”, “a loan servicing tool of the loan processing subsystem presented by the first subsystem”, “loan processor”, “application programming interface”, and “an internet communications network”), they do not add significantly more (also known as an "inventive concept") to the exception, because they amount to simply implementing the abstract idea on a computer. Instead, they merely add the words "apply it" (or an equivalent) with the abstract idea, or mere instructions to implement an abstract idea on a computer, or merely use a computer as a tool to perform an abstract idea.
In regards to the extra solution activities (“obtaining”, “updating”, “receiving”, “recording”, and “transferring”), these are well-understood, routine, conventional computer functions recognized by the court decisions listed in MPEP § 2106.05(d).
More specifically, in regards to “updating” and “recording” steps, see the court cases Versata Dev. Group, Inc. v. SAP Am., Inc., 793 F.3d 1306, 1334, 115 USPQ2d 1681, 1701 (Fed. Cir. 2015) (storing and retrieving information in memory); and OIP Techs., Inc., v. Amazon.com, Inc., 788 F.3d 1359, 1363, 115 USPQ2d 1090, 1092-93 (Fed. Cir. 2015) (storing and retrieving information in memory).
More specifically, in regards to “receiving”, “obtaining”, and “transferring” steps, see the court cases OIP Techs., Inc., v. Amazon.com, Inc., 788 F.3d 1359, 1363, 115 USPQ2d 1090, 1093 (Fed. Cir. 2015) (sending messages over a network) and (presenting offers and gathering statistics), OIP Techs., 788 F.3d at 1362-63, 115 USPQ2d at 1092-93; buySAFE, Inc. v. Google, Inc., 765 F.3d 1350, 1355, 112 USPQ2d 1093, 1096 (Fed. Cir. 2014) (computer receives and sends information over a network).
Moreover, in regards to the “displaying” steps (or “application programming interface” elements), see Apple, Inc. v. Ameranth, Inc., 842 F.3d 1229, 120 U.S.P.Q.2d 1844 (Fed. Cir. 2016) (Holding that the claimed menu graphic user interface is an abstract idea under 35 USC §101, because claimant "[did] not claim a particular way of programming or designing the software to create menus that have these features, but instead merely claims the resulting systems").
Independent claims 19 and 20 are rejected on the same grounds as independent claim 1, plus also on the grounds that independent claim 20 recites a non-transitory computer-readable medium, which is merely another generic computer component.
All dependent claims are also rejected, because they merely further define the abstract idea.
RESPONSE TO ARGUMENTS
Re: Claim Rejections - 35 USC § 112(b)
A new 35 USC § 112(b) rejection has been added, in response to Applicant’s addition of new claim 24.
Re: Claim Objections
Claims 1, 19, and 20 were previously objected to because of the following informalities: “the obtained a pre-loan value” should be amended to “the obtained pre-loan value”, and “obtaining the a pre-loan value” should be amended to “obtaining the pre-loan value”. The objections were previously withdrawn, in response to Applicant’s amendments to the independent claims.
Re: Claim Rejections - 35 USC § 103
The 35 USC § 103 rejections were previously withdrawn, in response to Applicant’s amendments to the claims.
Re: Claim Rejections - 35 USC § 101
Applicant’s arguments filed on Dec. 15, 2025 have been fully considered, but the Examiner does not find them to be persuasive.
The Examiner holds that amending the previously recited abstract idea feature of “after receiving the loan request, determining … a loan structure for the loan request based on the selected loan value and the customer client and a merchant” to now recite “automatically determining” is equivalent to reciting the abstract idea plus “apply it on a general purpose computer”. Therefore, this amendment does not overcome the 35 USC § 101 rejection.
The Examiner holds that amending the previously recited abstract idea feature of “wherein the loan request is for a loan value selected by the customer client”” to “wherein the loan request is for a loan value of the distributed ledger digital asset selected by the customer client” merely specifies the type of asset being borrowed, or the denomination of the asset being borrowed, and therefore merely further defines the abstract idea of “wherein the loan request is for a loan value”. Therefore, this amendment does not overcome the 35 USC § 101 rejection.
In regards to the previously added claims 21 and 22, they recite “wherein the first subsystem is a subsystem using an application programming interface ("API") of the loan processor that is integrated into a front end of an application interface provided by the merchant,” or “… provided by a device of the customer client.” which the Examiner interprets as being redundant of features recited in the independent claim 1.
In regards to newly added dependent claims 23 and 24, they recite “wherein the updating is verifiable by other participants of the decentralized network”, which the Examiner interprets as being an obvious feature of the claimed “distributed ledger”, which is a general purpose computer component.
Applicant’s arguments filed on June 19, 2025 have been fully considered, but the Examiner does not find them to be persuasive.
In page 13 through 16 of Applicant’s response dated June 19, 2025, the Applicant argues:
With respect to the rejected claims, the undersigned respectfully disagrees that the claims perform no more than purely generic computer functions. Furthermore, it is an inaccurate statement of the law to find that a computer that performs only abstracted generic functions is patent ineligible. Rather a correct statement of the law is that performing an otherwise Abstract method on a computer does not make the Abstract method patentable, anda non-conventional method, or software that endows a computer with new functions, is subject matter eligible. Both of these arguments are addressed herein, below.
First, the undersigned submits that the claims perform more than generic functions. For example, no system performs the following non-generic functions, as recited succinctly in applicant's amended independent claim 1. …
The recited functionality adds functionality never known before to a system, which may be clear due to the Examiner not alleging any rejections under 35 U.S.C. § 102 and/or under 35 U.S.C. § 103. New functionality (as opposed to conventional steps performed on a computer) cannot be said to be generic.
In response to these arguments, the Examiner notes that the grounds of rejection are not “that the claims perform no more than purely generic computer functions” (as argued by Applicant). The grounds of rejection are that the claims are directed to an abstract idea, without “significantly more”. More specifically, the claims are directed to “Certain Methods of Organizing Human Activity", specifically “Commercial or Legal Interactions (Including Agreements in the form of Contracts; Legal Obligations; Advertising, Marketing, or Sales Activities or Behaviors; Business Relations)”, as discussed in MPEP §2106(a)(2) Parts (I) and (II), and in the 2019 Revised Patent Subject Matter Eligibility Guidance.
In pages 15 through 18 of Applicant’s response dated June 19, 2025, the Applicant argues:
The Office Action alleges that … conventional and generic computing functions or "insignificant extra-solution activity activities" …
To the extent that the Examiner is reading only the first verb or certain parts of several limitations of the claims, the Examiner's analysis is wrong in procedure and law. In proper procedure, when determining whether a claim is subject matter eligible, the language of the entire claim must be accounted for (see, e.g., Enfish LLC v. Microsoft Corp. Fed. Cir (2016)).
In response to these arguments, the Examiner notes that where the 35 USC 101 rejection refers to the first verb (or certain parts) of a limitation, it is shorthand for the entire limitation. The reason for this is for brevity and compact prosecution.
In pages 16 through 18 of Applicant’s response dated June 19, 2025, the Applicant argues:
In law, is it not correct that any claim that only includes limitations where software causes a computer to perform functions, is drawn to an Abstract idea, such as
“obtaining, at a temporary distributed ledger digital asset address of the loan processing subsystem, a pre-loan value of a distributed ledger digital asset from a distributed ledger digital asset network subsystem”,
“updating at least one distributed ledger of a network”,
“receiving, at the loan processing subsystem, a loan request from a first subsystem on behalf of the customer client via an internet communications network”,
“recording the information indicative of the customer client and the guaranteed deposit in the at least one distributed ledger”,
“transferring at least a portion of the obtained value of the distributed ledger digital asset from the temporary distributed ledger digital asset address of the loan processing subsystem to a distributed ledger digital asset wallet of a merchant client subsystem of the merchant”,
“updating the at least one distributed ledger without the intervention of any central authority as at least one loan payout based on the determined loan structure”,
“receiving a fiat money asset, at the loan processing subsystem, from at least one of a customer client subsystem on behalf of the customer client or a fiat money asset network subsystem on behalf of the customer client as at least one loan payoff based on the determined loan structure”,
“present[ing] real-time quoting of the loan value in currencies of at least the distributed ledger digital asset and a fiat money asset and an exchange rate therebetween”, and “the receiving the loan request is conducting an interaction with the customer client”.
Such a holding is equivalent to saying that all software inventions are ineligible, which has been explicitly disavowed by the Federal Circuit (see, e.g., Enfish LLC v. Microsoft Corp. Fed. Cir (2016): "Software can make non-abstract improvements to computer technology just as hardware improvements can, and sometimes the improvements can be accomplished through either route. We thus see no reason to conclude that all claims directed to improvements in computer-related technology, including those directed to software, are abstract"). In fact, in Enfish, the court found that the means in claim 17 of one of the patents encompassed creating a table in computer memory, assigning a row and column, storing information, and storing and accessing data (Enfish slip opinion at p. 13-14). The fact that the computer in Enfish was performing these generic computer functions did not prevent the claims from being deemed subject matter eligible.
In fact, these functions were the functions behind the means by which the computer was configured to create a self-referential table that was the subject of the technology in Enfish. The court found the self-referential table to be an improvement to computing technology and therefore found the claims to be subject matter eligible.
In response to these arguments, the Examiner again notes that the basis of the rejection is not that “any claim that only includes limitations where software causes a computer to perform functions, is drawn to an Abstract idea” (as argued by the Applicant). Instead, the Examiner’s rejection expressly states that the claimed extra solution activity steps (“obtaining”, “updating”, “receiving”, “recording”, and “transferring”) “are well-understood, routine, conventional computer functions, as recognized by the court decisions listed in MPEP § 2106.05(d)”.
More specifically, in regards to “updating” and “recording” steps, see the court cases Versata Dev. Group, Inc. v. SAP Am., Inc., 793 F.3d 1306, 1334, 115 USPQ2d 1681, 1701 (Fed. Cir. 2015) (storing and retrieving information in memory); and OIP Techs., Inc., v. Amazon.com, Inc., 788 F.3d 1359, 1363, 115 USPQ2d 1090, 1092-93 (Fed. Cir. 2015) (storing and retrieving information in memory).
More specifically, in regards to “receiving”, “obtaining”, and “transferring” steps, see the court cases OIP Techs., Inc., v. Amazon.com, Inc., 788 F.3d 1359, 1363, 115 USPQ2d 1090, 1093 (Fed. Cir. 2015) (sending messages over a network) and (presenting offers and gathering statistics), OIP Techs., 788 F.3d at 1362-63, 115 USPQ2d at 1092-93; buySAFE, Inc. v. Google, Inc., 765 F.3d 1350, 1355, 112 USPQ2d 1093, 1096 (Fed. Cir. 2014) (computer receives and sends information over a network).
Moreover, in regards to the “displaying” steps (or “application programming interface” elements), see Apple, Inc. v. Ameranth, Inc., 842 F.3d 1229, 120 U.S.P.Q.2d 1844 (Fed. Cir. 2016) (Holding that the claimed menu graphic user interface is an abstract idea under 35 USC §101, because claimant "[did] not claim a particular way of programming or designing the software to create menus that have these features, but instead merely claims the resulting systems").
In page 18 of Applicant’s response dated June 19, 2025, the Applicant argues:
The Examiner should similarly find that the present claims recite technology that is subject matter eligible because the present claims recite an improvement to technology. Federal Circuit cases that have found a claim patent eligible have rested their decisions on this issue, and Federal Circuit cases that have found a claim not subject-matter eligible have found that there was not improvement to technology. As explained in paragraph [0029] of applicant's specification as filed, the present technology improves a payment service to accept a greater diversity of currencies including fiat currencies and cryptocurrencies, and addresses problems with transactions involving cryptocurrencies, because it offers to a distributed computing environment not only the benefits of securely completing a transaction, but also the benefits of enabling a payment processing subsystem "to already possess the distributed ledger digital asset (e.g., bitcoins) to be sent out as the loan payout funds (e.g., to the merchant or to the customer) prior to any such loan payout fund transaction and/or prior to any receipt of any loan payoff funds (e.g., from the customer), such that LPS subsystem 10 may not be exchanging the customer client's money (e.g., loan payment funds) for the distributed ledger digital asset (e.g., bitcoins)."
As the present technology provides functionality that has never been provided by a payment service, and addresses problems germane to conventional cryptocurrency transactions, and improves payment services by offering additional functionality, the claims should be properly considered subject matter eligible.
The Examiner respectfully disagrees with Applicant’s argument that “the present claims recite technology that is subject matter eligible because the present claims recite an improvement to technology”.
The Applicant argues (based on paragraph [0029] of applicant's specification) that the benefits of the claimed invention are: “improv[ing] a payment service to accept a greater diversity of currencies including fiat currencies and cryptocurrencies”, and “enabling a payment processing subsystem ‘to already possess the distributed ledger digital asset (e.g., bitcoins) to be sent out as the loan payout funds (e.g., to the merchant or to the customer) prior to any such loan payout fund transaction and/or prior to any receipt of any loan payoff funds (e.g., from the customer)’”.
In contrast, the Examiner finds that these features do not "improve the functioning of the computer itself", nor are they “a technological solution to a technological problem” (see MPEP § 2106.05(a)). Instead, the Examiner finds that these are improvements to an abstract idea (that is implemented on generic computers): making payments and loans with different currencies.
In page 19 through 20 of Applicant’s response dated June 19, 2025, the Applicant argues:
While the Examiner may be drawn to Federal Circuit decisions that include language listing generic computer functions in their dicta to find a particular claim to recite ineligible subject matter, these cases do not contradict the arguments made above. For example, in TLI Communications, the court explained: "Likewise, the server is described simply in terms of performing generic computer functions such as storing, receiving, and extracting data" (TLI Communications v. AV Automotive, slip opinion, p. 9 (2016)). Despite the court abstracting the computer functions down to the basic verbs, the court's decision rested in the fact that "the claims are not directed to a solution to a 'technological problem'" (TLI Communications, slip opinion, p. 10).
Likewise, in Electric Power Group v. Alstom, the court also characterized the claims in abstracted verbs, but again the court's decision was not based on this dicta, but on the fact that the claims did not provide any advance in computer technology (Electric Power Group v. Alstom, slip opinion, p. 2: "Though lengthy and numerous, the claims do not go beyond requiring the collection, analysis, and display of available information in a particular field, stating those functions in general terms, without limiting them to technical means for performing the functions that are arguably an advance over conventional computer and network technology") .
When focusing on the critical inquiry of whether the claims, when fully considered, represent an advance to computer technology, the present claims must be considered subject matter eligible. The requirement is not just whether new hardware is added to the computer system, or just whether the computer system is made more efficient, but rather does the invention represent a technological advance. DDR, Enfish, and McRo were all purely software inventions that added functionality to a computer that was considered a technological advance. Likewise, the present claims should similarly be considered a technological advance as they provide functionality that has not before been included in a payment service, and the functionality solves several problems with cryptocurrency transactions. In fact, the present technology makes cryptocurrency transactions actually feasible in real life.
In response to these arguments that “the present claims should similarly be considered a technological advance as they provide functionality that has not before been included in a payment service” and that “the functionality solves several problems with cryptocurrency transactions”, the Examiner interprets the cited case law as supporting the rejection, because the Examiner holds that the claimed features recite improvements to a business method, not to a technological solution to a technological problem.
Examples of claimed features that recite abstract idea steps are: “after receiving the loan request, determining … a loan structure for the loan request based on the selected loan value and the customer client and a merchant”, “wherein the loan structure comprises information indicative of the customer client and the guaranteed deposit”, and “guaranteeing … that a deposit has been made, after obtaining the pre-loan value of the distributed ledger digital asset, on behalf of the customer client based on the selected loan value”.
In page 20 of Applicant’s response dated June 19, 2025, the Applicant argues:
Applicant respectfully disagrees with the Examiner's allegation that the claim limitations of applicant's independent claim 1 "do not include additional elements that are sufficient to amount to significantly more than the abstract idea" and that the alleged "abstract idea is not integrated into a practical application, because [the claim language] .. . (a) do not add a meaningful limitation to the abstract idea, because they amount to simply implementing the abstract idea on a computer, .. . (b) do not add a meaningful limitation to the method, as they are insignificant extra-solution activity, . . . and/or (c) [do] not integrate the abstract idea into a practical application" (Office Action, page 5).
Applicant's independent claim 1 includes several additional elements that, when combined and taken as a whole, amount to significantly more than the alleged judicial exception of "Certain Methods of Organizing Human Activity." As stated on page 3 of the Memorandum of May 4, 2016 by the USPTO for Formulating a Subject Matter Eligibility Rejection and Evaluating the Applicant's Response to a Subject Matter Eligibility Rejection (May 4 Memo), "it is particularly critical to address the combination of additional elements, because while individually-viewed elements may not appear to add significantly more, those additional elements when viewed in combination may amount to significantly more than the exception by meaningfully limiting the judicial exception." When looking at all these additional limitations of applicant's independent claim 1 as an ordered combination of particular operations, it is clear that they provide Significantly more than the alleged judicial exception of "Certain Methods of Organizing Human Activity" (Office Action, page 4).
The Examiner holds that the above arguments in page 20 are generalized assertions, presented without specific examples.
In pages 21 through 22 of Applicant’s response dated June 19, 2025, the Applicant argues:
The distributed computing environment of applicant's amended independent claim 1 is not merely limiting the use of concept to a particular technological environment. Instead, these limitations provide meaningful limitations that restrict the identified concept to a particular useful application.
Applicant's independent claim 1 combines the use of a loan processing service subsystem and a distributed ledger digital asset network subsystem and a decentralized network and a first subsystem, a merchant, a customer client, and at least one of a customer client subsystem on behalf of the customer client or a fiat money asset network subsystem, and an internet communications network carrying out several specific operations in a specific order.
It is necessary to consider the features of the loan processing service subsystem in combination with the feature(s) of the distributed ledger digital asset network subsystem and the decentralized network and the other subsystems when evaluating eligibility of applicant's independent claim 1.
The specific elements of applicant's independent claim 1 work in combination to affect the secure transmission of at least a portion of the obtained pre-loan value of the distributed ledger digital asset from the temporary distributed ledger digital asset address of the loan processing subsystem to a distributed ledger digital asset wallet of a merchant client subsystem of the merchant by updating the at least one distributed ledger without the intervention of any central authority as at least one loan payout based on the determined loan structure.
The Examiner holds that the above argued feature of “updating the at least one distributed ledger without the intervention of any central authority as at least one loan payout based on the determined loan structure” (emphasis added) is a feature inherent to all distributed ledgers – that they are distributed, and are updated without the intervention of any central authority. Therefore, the Applicant’s argument that this feature is “substantially more” than the abstract idea is unpersuasive, because it the argument is directed to a feature inherent to all “distributed ledgers”.
In pages 21 through 22 of Applicant’s response dated June 19, 2025, the Applicant further argues:
This enables the loan processing service subsystem "to already possess the distributed ledger digital asset (e.g., bitcoins) required to pay the merchant prior to any transaction with a customer, so [the loan processing service subsystem] may not be exchanging the customer's money for distributed ledger digital asset (e.g., bitcoins)" (applicant's specification, paragraph [0037]). In particular, considering these limitations in combination amount to significantly more than the alleged abstract idea of "Certain Methods of Organizing Human Activity" (Office Action, page 4), as well as significantly more than the alleged abstract idea of "Storing and retrieving information in memory [of] Versata Dev. Group, Inc. v. SAP Am., Inc. [or] OIP Techs., Inc., v. Amazon.com, Inc." (Office Action, page 6), as well as significantly more than the alleged abstract idea of "sending messages over a network [of] OIP Techs., Inc., v. Amazon.com, Inc. " (Office Action, page 6), as well as significantly more than the alleged abstract idea of "presenting offers and gathering statistics lof] OIP Techs." (Office Action, page 6), as well as significantly more than the alleged abstract idea of "computer receives and sends information over a network [of] buySAFE, Inc. v. Google, Inc." (Office Action, page 6). The various specific order of operations of applicant's independent claim 1 in combination provide meaningful limitations beyond generally linking the use of the alleged abstract idea to a particular technological environment.
In response to the above arguments, the Examiner respectfully disagrees with Applicant’s conclusion that it is “significantly more than the alleged abstract idea” to enable the loan processing service subsystem “to already possess the distributed ledger digital asset (e.g., bitcoins) required to pay the merchant prior to any transaction with a customer, so [the loan processing service subsystem] may not be exchanging the customer's money for distributed ledger digital asset (e.g., bitcoins)”. On the contrary, the Examiner holds that this is evidence that these features are directed to the abstract idea of “Agreements in the form of contracts”.
In pages 22 through 23 of Applicant’s response dated June 19, 2025, the Applicant argues:
On pages 3 and 4 of the Memorandum of December 15, 2016 by the USPTO for Subject Matter Eligibility Examples: Business Methods (December 15th Memo), the USPTO provides subject matter eligibility guidance through analysis of BASCOM Global Internet v. AT&T Mobility LLC, 119 USPQ2d 1236 (Fed. Cir. 2016) (BASCOM) by stating:
analysis under Step 2B (also called the ‘inventive concept inquiry') requires more than determining that each additional claim element - the controlled access network accounts, a local client computer, an Internet computer network, and a remote ISP server - is well known by itself. Here, an inventive concept can be found in the unconventional and non-generic combination of known elements . . . [and] the claimed arrangement of elements in the system results in an improvement in the technology of filtering content on the Internet, because it offers 'both the benefits of a filter on the local computer, and the benefits of a filter on the ISP server.'
Similarly, the arrangement of elements in applicant's independent claim 1 "results in an improvement in the technology of" processing a transaction, because it offers to a distributed computing environment not only the benefits of securely completing a transaction, but also the benefits of enabling a payment processing subsystem "to already possess the distributed ledger digital asset (e.g., bitcoins) to be sent out as the loan payout funds (e.g., to the merchant or to the customer) prior to any such loan payout fund transaction and/or prior to any receipt of any loan payoff funds (e.g., from the customer), such that LPS subsystem 10 may not be exchanging the customer client's money (e.g., loan payment funds) for the distributed ledger digital asset (e.g., bitcoins)" (applicant's specification, paragraph [0029]).
In response to the above arguments, the Examiner respectfully disagrees with the Applicant, because the claims in BASCOM recite “a technological solution to a technological problem” (of filtering content on the Internet), and offers “both the benefits of a filter on the local computer, and the benefits of a filter on the ISP server”.
In contract, the claims in the present application recite solutions to non-technological problems:
“improv[ing] a payment service to accept a greater diversity of currencies including fiat currencies and cryptocurrencies”, and
“enabling a payment processing subsystem ‘to already possess the distributed ledger digital asset (e.g., bitcoins) to be sent out as the loan payout funds (e.g., to the merchant or to the customer prior to any such loan payout fund transaction and/or prior to any receipt of any loan payoff funds (e.g., from the customer)’)”.
The Examiner holds that these purported benefits do not "improve the functioning of the computer itself", nor are they “a technological solution to a technological problem” (see MPEP § 2106.05(a)).
Moreover, in page 23 of Applicant’s response dated June 19, 2025, the Applicant argues:
Therefore, similar analysis and a similar patent eligible determination to that in BASCOM is appropriate and warranted with respect to applicant's independent claim 1. The limitations of applicant's independent claim 1, as a whole, amount to significantly more than the alleged judicial exception. The method of applicant's independent claim 1 improves upon prior art methods. As explained in applicant's specification, like in BASCOM, "this combination of limitations is not well-understood, routine, or conventional activity" (December 15th Memo). Particularly, as explained in applicant's specification, "[w]ith respect to the flow of funds, it is worth noting again that LPS subsystem 10 may be operative to never buy a distributed ledger digital asset (e.g., bitcoin) with merchant money and/or with customer money, and/or LPS subsystem 10 may be operative to never have merchant money in an operational account" (applicant's specification, paragraph [0035]).
The Examiner holds that these purported benefits (“LPS subsystem 10 may be operative to never buy a distributed ledger digital asset (e.g., bitcoin) with merchant money and/or with customer money, and/or LPS subsystem 10 may be operative to never have merchant money in an operational account”) do not "improve the functioning of the computer itself", nor are they “a technological solution to a technological problem”.
In page 24 of Applicant’s response dated June 19, 2025, the Applicant argues:
Moreover, the limitations of applicant's independent claim 1, like in BASCOM, "confine the abstract idea" (e.g., the alleged abstract idea of "Certain Methods of Organizing Human Activity") "to a particular, practical application of the [alleged] abstract idea" (December 15th Memo). Particularly, as explained in applicant's specification, "[t]he distributed ledger digital asset (e.g., bitcoins) paid by LPS subsystem 10 to the merchant may not come from the customer. LPS subsystem 10 may instead purchase the distributed ledger digital asset (e.g., bitcoins) regularly from various distributed ledger digital asset (e.g., bitcoin) sellers (e.g., client subsystem 100a), and may pay for them with its own funds in advance of any merchant transaction and/or in advance of any customer loan agreement (e.g., before (i) or (ii) or (iii) or (iv) described above). Thus, LPS subsystem 10 may be operative to store a cache of distributed ledger digital asset (e.g., bitcoins) sufficient to settle upcoming transactions, and may take on any risk that the value of the distributed ledger digital asset may drop during that time. In some embodiments, payments made by LPS subsystem 10 may only flow to the merchant, so the merchant's customer may not direct their payments to any other destination. LPS subsystem 10 may only send the merchant sufficient value to complete the transaction, so it may be operative to never transfer any more value to the merchant than required for the purchase of the good or service. LPS subsystem 10 may be operative to already possess the distributed ledger digital asset (e.g., bitcoins) required to pay the merchant prior to any transaction with a customer, so LPS subsystem 10 may not be exchanging the customer's money for distributed ledger digital asset (e.g., bitcoins). Indeed, the service provided by LPS subsystem 10 may be at least partially transparent to the merchant's customers" (applicant's specification, paragraph [0037]).
Again, the Examiner holds that these features (and their purported benefits) do not "improve the functioning of the computer itself", nor are they “a technological solution to a technological problem”. For example, the Applicant argues (emphasis added): “LPS subsystem 10 may be operative to store a cache of distributed ledger digital asset (e.g., bitcoins) sufficient to settle upcoming transactions, and may take on any risk that the value of the distributed ledger digital asset may drop during that time”.
However, “tak[ing] on any risk that the value of the distributed ledger digital asset may drop during that time” does not "improve the functioning of the computer itself", nor are they “a technological solution to a technological problem”. Instead, this is an improvement in the abstract idea (which is non-technological) of assuming financial risk
In page 25 of Applicant’s response dated June 19, 2025, the Applicant argues:
Therefore, as similarly determined by the above-mentioned subject matter eligibility analysis of BASCOM with respect to filtering systems, it is to be understood that the limitations of applicant's independent claim 1 with respect to payment processing do not simply apply an alleged abstract idea on a generic set of computers. Applicant's independent claim 1 recites a "technology-based solution" (December 15st Memo) of a specific order of operations amongst at least three distinct subsystems that overcomes the disadvantages of prior art systems. Thus, as similarly determined with respect to the claimed limitations in BASCOM, when viewed as an ordered combination, the claim limitations of applicant's independent claim 1 amount to significantly more than the alleged abstract idea. As such, applicant's independent claim 1 is patent eligible.
The Examiner’s response to Applicant’s argument above is that the Applicant incorrectly characterizes the USPTO’s Subject Matter Eligibility Guidelines (December 15st Memo) and the BASCOM case as holding that “a specific order of operations amongst at least three distinct subsystems that overcomes the disadvantages of prior art systems” is automatically subject matter eligible. More specifically, the verdict in the BASCOM case was not made on these grounds.
In pages 25 through 26 of Applicant’s response dated June 19, 2025, the Applicant argues (emphasis added):
On page 5 of the Office Action, the Examiner suggests that the limitations of applicant's independent claim 1 allegedly recite an abstract idea with additional generic computer elements, without providing supporting evidence for such an allegation. However, as made clear on page 3 of the Memorandum of April 19, 2018 by the USPTO for Changes in Examination Procedure Pertaining to Subject Matter Eligibility, Recent Subject Matter Eligibility Decision (Berkheimer v. HP, Inc.) (April 19th Memo), "an examiner should conclude that an element (or combination of elements) represents well-understood, routine, conventional activity only when the examiner can readily conclude that the element (s) is widely prevalent or in common use in the relevant industry" and "such a conclusion must be based upon a factual determination," where "the analysis as to whether an element (or combination of elements) is widely prevalent or in common use is the same as the analysis under 35 U.S.C. § 1li2(a}) as to whether an element is so well-known that it need not be described in detail in the patent specification [emphasis original] ." Applicant respectfully requests that the Examiner provide appropriate factual evidence, as required by the April 19'* Memo, in support of the Examiner's allegation that the limitations of applicant's independent claim 1 "are well-understood, routine, conventional computer functions" (Office Action, page 6). Should applicant's current arguments fail to bring this application into condition for allowance, applicant expressly reserves the right to argue against any such evidence that the Examiner is able to provide.
In response to Applicant’s arguments, according to MPEP § 2106.05(d), the Examiner can cite court cases, which is what the Examiner did in all Office Actions:
The required factual determination must be expressly supported in writing, as discussed in MPEP § 2106.07(a). Appropriate forms of support include one or more of the following: (a) A citation to an express statement in the specification or to a statement made by an applicant during prosecution that demonstrates the well-understood, routine, conventional nature of the additional element(s); (b) A citation to one or more of the court decisions discussed in Subsection II below as noting the well-understood, routine, conventional nature of the additional element(s); (c) A citation to a publication that demonstrates the well-understood, routine, conventional nature of the additional element(s); and (d) A statement that the examiner is taking official notice of the well-understood, routine, conventional nature of the additional element(s). For more information on supporting a conclusion that an additional element (or combination of additional elements) is well-understood, routine, conventional activity, see MPEP § 2106.07(a), subsection III.
In the Office Action, in regards to “updating” and “recording” steps, the rejection cites the court cases Versata Dev. Group, Inc. v. SAP Am., Inc., 793 F.3d 1306, 1334, 115 USPQ2d 1681, 1701 (Fed. Cir. 2015) (storing and retrieving information in memory); and OIP Techs., Inc., v. Amazon.com, Inc., 788 F.3d 1359, 1363, 115 USPQ2d 1090, 1092-93 (Fed. Cir. 2015) (storing and retrieving information in memory).
In the Office Action, in regards to “receiving”, “obtaining”, and “transferring” steps, the rejection cites the court cases OIP Techs., Inc., v. Amazon.com, Inc., 788 F.3d 1359, 1363, 115 USPQ2d 1090, 1093 (Fed. Cir. 2015) (sending messages over a network) and (presenting offers and gathering statistics), OIP Techs., 788 F.3d at 1362-63, 115 USPQ2d at 1092-93; buySAFE, Inc. v. Google, Inc., 765 F.3d 1350, 1355, 112 USPQ2d 1093, 1096 (Fed. Cir. 2014) (computer receives and sends information over a network).
In the Office Action, in regards to the “displaying” steps (or “application programming interface” elements), the rejection cites the court case Apple, Inc. v. Ameranth, Inc., 842 F.3d 1229, 120 U.S.P.Q.2d 1844 (Fed. Cir. 2016) (Holding that the claimed menu graphic user interface is an abstract idea under 35 USC §101, because claimant "[did] not claim a particular way of programming or designing the software to create menus that have these features, but instead merely claims the resulting systems").
In page 26 of Applicant’s response dated June 19, 2025, the Applicant argues:
Moreover, analysis of Tuxis Technologies, LLC v. Amazon.com, Inc., 2014 US Dist. LEXIS 122457 (US Dist. Ct. Del. 9/3/2014) (Tuxis) may be instructive. In Tuxis, the court followed the Alice case in analyzing a claim under the abstract idea exception to patent eligibility. The court stated that "once an abstract idea is identified," the court must perform a pre-emption analysis and determine whether the remainder of the claim includes limitations that "narrow, confine, or otherwise tie down the claim so that, in practical terms, it does not cover the full abstract idea itself" (Tuxis, US Dist. LEXIS 122457, citing Accenture, 728 F.3d at 1341). "The relevant inquiry is whether a claim, as a whole, includes meaningful limitations restricting it to an application, rather than merely an abstract idea" (Id.).
Clearly, the limitations of applicant's independent claim 1 act to narrow, confine, and otherwise tie down the claim so as not to cover the general alleged abstract idea of just "Certain Methods of Organizing Human Activity". In applicant's independent claim 1, very particular operations must be carried out as explained above by very particular subsystems. Clearly, these detailed requirements are enough to render applicant's independent claim 1 patent-eligible under 35 U.S.C. § 101 as the claim is not for the mere alleged abstract idea of "Certain Methods of Organizing Human Activity".
In response, the Examiner respectfully disagrees. The Examiner holds that the claimed operations that must be carried out by claimed subsystems are not enough to render applicant's independent claim 1 patent-eligible under 35 U.S.C. § 101.
Finally, in page 27 of Applicant’s response dated June 19, 2025, the Applicant argues:
Pre-emption of a field by a claim to an abstract idea was a major main concern of the Supreme Court in Alice. There, the Supreme Court emphasized that "the concern that drives this exclusionary principle [that abstract ideas cannot be patented] is one of pre-emption" (Alice, Slip Op. at 5). That is, the Court does not want to allow an inventor to "effectively grant a monopoly over an abstract idea" (Id. at 6). However, the Court very clearly cautioned that it treads carefully in construing this exclusionary principle "lest it swallow all of patent law," since all inventions embody, use, reflect, rest upon, or apply abstract ideas (Id.). Moreover, an invention is not rendered ineligible for patent simply because it involves an abstract concept (Id.). The Court further explained how it is important to distinguish between patents that claim the building blocks of human ingenuity and those that integrate the building blocks into something more, thereby transforming them into a patent-eligible invention, which poses no risk of pre-emption, and therefore remain eligible for the monopoly granted under our patent laws (Alice, Slip. Op. at 6). Simply put, given the above discussion of applicant's independent claim 1, the limitations of applicant's independent claim 1 do not pre-empt the entire field of payment processing.
In response to the Applicant’s argument above, the Examiner does not argue in the Office Action that “the limitations of applicant's independent claim 1 … pre-empt the entire field of payment processing”. Instead, the Examiner holds that the independent claim 1 is not patent-eligible under 35 U.S.C. § 101
Conclusion
Applicants are invited to contact the Office to schedule an in-person interview to discuss and resolve the issues set forth in this Office Action. Although an interview is not required, the Office believes that an interview can be of use to resolve any issues related to a patent application in an efficient and prompt manner.
Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice.
Any inquiry concerning this communication or earlier communications should be directed to Examiner Ayal Sharon, whose telephone number is (571) 272-5614, and fax number is (571) 273-1794. The Examiner can normally be reached from Monday to Friday between 9 AM and 6 PM. If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Christine M Behncke can be reached on (571) 272-8103. The fax number for the organization where this application or proceeding is assigned is 571-273-8300.
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Sincerely,
/Ayal I. Sharon/
Examiner, Art Unit 3695
February 20, 2026