Notice of Pre-AIA or AIA Status
The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA .
Status of Claims
This action is in response to filings received 02/05/2026.
This application claims earliest priority from provisional application 62/773,080 filed 11/29/2018.
Claims 1 & 40 being independent.
No amendments made.
Claims 7, 12-13, 19-20, 26, 36, 38, 42, 44, 46, 52 and 54 canceled.
Claims 1-6, 8-11, 14-18, 21-25, 27-35, 37, 39-41, 43, 45, 47-51, 53 and 55 are currently pending and have been examined.
Response to Arguments
Applicant's arguments filed 02/05/2026 have been fully considered but they are not persuasive.
With respect to Applicants’ arguments under 35 U.S.C. § 101, the arguments have been fully considered, however, the examiner respectfully disagrees.
Under Step 2A – Prong one, the Applicant argues that the claims are not directed to an abstract idea and instead recite a specific distributed-ledger smart-contract architecture; however, the Examiner respectfully disagrees. Under the broadest reasonable interpretation, the claims are directed to transferring a net settlement value to or from the purchaser of the commodity, which constitutes a fundamental economic practice and commercial/legal interaction, falling within the “Certain Method of Organizing Human Activity” grouping.
Further, the claimed steps of establishing prices, receiving payments, determining differences, and transferring settlement value collectively describe a fundamental economic transaction that can be performed conceptually without regard to any specific technological implementation.
Accordingly, the focus of the claims is on the economic arrangement itself, rather than any asserted improvement in computer or network technology.
Applicant’s emphasis on distributed ledgers, smart contracts, oracle logic, cryptocurrency, and token-based transfers, does not change the focus of the claims, which remains directed to settlement/pricing of a commodity transaction.
These elements merely provide a technological environment in which the abstract idea is performed and do not alter the underlying character of the claims.
Further, representing a commodity using tokens or cryptocurrency, is merely a digital representation of value and remains part of the abstract idea itself, rather than a technological improvement.
Such representation does not improve how data is stored, processed, or transmitted, but instead reflects a business choice regarding how value is expressed.
Under Step 2A – Prong Two, the Applicant argues that the claims integrate the abstract idea into a practical application based on:
periodic tracking of value
oracle-based pricing inputs
distributed ledger recording
token-based settlement transfers, and
smart-contract execution
the claimed elements are invoked at a high-level of generality and perform only their typical functions, which is insufficient to integrate the abstract idea into a practical application.
This is not persuasive since these elements, individually and as an ordered combination, merely implement the abstract idea using generic computer and distributed network technology performing their conventional functions (e.g., receiving data, tracking values, executing logic, recording transaction, and transferring value). The claimed combination does not result in any improvement to the functioning of a computer, network, or distributed ledger, but instead automates a pre-existing economic practice.
With respect to Applicant’s specific arguments (pages 3-8 and 13-15):
(1) “Periodic tracking” and time-based valuation
This limitation merely updates a value over time, which is a fundamental data processing and economic calculation step and does not improve computer functionality. Tracking data over time is a basic computer function and does not constitute a technological improvement. No specialized data structure, algorithm, or technical mechanism for performing the tracking is recited.
(2) “Oracle-based logic/secure resource”
This claimed oracle is used only as a data source for pricing inputs and does not improve the operation of the computer or distributed ledger itself. It merely supplies external data for use in performing the abstract economic calculation. The claims do not recite how the oracle operates in a technologically improved manner, only that it provides data.
(3) “Distributed ledger/smart contract
The distributed ledger and smart contract are used as tools to record and execute the settlement process and perform their ordinary, well-known functions. The claims do not recite any improvement to blockchain technology itself (e.g., no new consensus mechanism, data structure, or protocol). Instead, the distributed ledger and smart contract are invoked as generic tools to execute and record the abstract transaction. No improvement to ledger efficiency, security, or operation is recited.
(4) “Token/cryptocurrency transfers
Token-based transfers are simply a form of value exchange and represent conventional financial transaction mechanisms implemented in a digital environment. The use of cryptocurrency does not alter the fundamental nature of the transaction as an exchange of value.
(5) Dependent claims
Applicant argues that the dependent claims further limit the invention (e.g., specific cryptocurrencies, blockchain types, wallet transfers, Solidity/Ethereum environments).
These limitations merely specify particular implementation or environments of the abstract idea and do not add a technological improvement or meaningful limitation. Selecting a particular blockchain (public/private/permissioned), cryptocurrency (Bitcoin/Ethereum/XRP), or programming environment (e.g., Solidity) constitutes a field-of-use limitation. Such limitations merely narrow the context in which the abstract idea is performed without adding any technological improvement inventive concept. These limitations do not impose any meaningful limit on the abstract idea beyond restricting it to a particular technological context.
With respect to Case Law arguments:
(1) Enfish/Desjardins
The arguments are not persuasive. Unlike Enfish or Desjardins, the present claims do not improve the functioning of a computer or a technological system, but instead use computer as tools to perform an economic settlement process. The present claims do not recite a specific improvement to data structures or system functionality, but instead apply generic computing to an economic practice.
(2) BASCOM
The arguments are not applicable. The claims do not recite a non-conventional or non-generic arrangement of components. The ordered combination merely automates a known business process using conventional distributed computing components. No technical problem specific to computer networks is identified or solved by the claimed arrangement. There is no indication that the arrangement departs from conventional use of these components.
(3) McRO
The arguments are not persuasive since the claims do not recite specific rules that improve a technological process, but instead recite steps for determining and transferring settlement value. The claims do not recite specific rules that improve a technological process, but instead recite rules for performing an economic transaction. The rules recited are directed to an economic outcome, not to improving how a computer performs a technical process.
Under Step 2B, Applicant argues that the claims amount to significantly more; however, the examiner respectfully disagrees.
The additional elements-including smart contracts, distributed ledgers, oracle inputs, and token transfers; are well-understood, routine, and conventional in the field of financial and blockchain-based transactions. These elements perform their typical and expected functions without any unconventional arrangement. Applicant has not provided evidence that these elements are anything other than well-understood, routine, and conventional.
The alleged “technical problem” (e.g., automating settlement, tracking value over time, enforcing reserves) is a business or financial problem, not a technological problem arising from computer or network technology. The claims do not address any technical deficiency in computer systems, but instead use generic computing tools to implement an economic arrangement.
Further, the claims do not recite any non-conventional arrangement or technological improvement, but merely automate a business process using known computing tools. The ordered combination of elements does not yield a result beyond the predictable use of conventional technology to execute a financial transaction and does not reflect any technical solution to a technological problem. The combination yields no more than the predictable result of executing a financial transaction using generic computing components.
Applicant’s argument that the claims cannot be performed mentally or without a computer is not persuasive, as the relevant inquiry is whether the claimed invention improves computer technology, not whether it requires a computer. Requiring a computer to perform the steps does not render the claims non-abstract.
Here the computer is used as a tool to automate settlement, which remains an abstract idea. The claims merely use computing technology as a tool to perform the abstract idea more efficiently. When considered as a whole, the claims do not recite significantly more than the abstract idea itself.
The ordered combination of elements follows a conventional sequence of receiving data, processing values, and executing transactions, and does not reflect any non-conventional arrangement or interaction that improves computer or network functionality.
For the reasons above, Applicant’s arguments have been considered but are not persuasive.
The claims remain directed to a judicial exception without significantly more. Accordingly, the rejection under 35 U.S.C. § 101 is maintained.
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 1-6, 8-11, 14-18, 21-25, 27-35, 37, 39-41, 43, 45, 47-51, 53 and 55 are rejected under 35 U.S.C. 101 because the claimed invention is directed to the abstract idea of transferring a net settlement value to or from the purchaser of the commodity without significantly more.
When taking the additional elements out from the claim language, claim 1 recites:
establishing a provisional price for a commodity on a first date for delivery at a future second date;
establishing a partial payment price on the first date corresponding to the commodity;
receiving the partial payment price from a purchaser of the commodity;
periodically tracking a value for the commodity as time passes from the first date to the second date;
calling for establishing a second price for the commodity based on the value for the commodity on or after the second date;
providing an option to the purchaser to select either the provisional price or the second price as a settlement price;
establishing the settlement price for the commodity on or after the second date, wherein the establishing the settlement price includes determining the net settlement value as a difference between the settlement price and the partial payment price;
transferring the net settlement value to or from the purchaser of the commodity; and
facilitating the purchase of the commodity by the purchaser by negotiating and recording the smart contract in the distributed ledger, wherein the negotiating and recording the smart contract in the distributed ledger includes establishing the provisional price for the commodity, wherein the provisional price and the partial payment price are established in a first cryptocurrency.
Thus, under the broadest reasonable interpretation, the claims recite the abstract idea of transferring a net settlement value to or from the purchaser of the commodity. Therefore, the claim is a “Certain Method of Organizing Human Activity” relating to a “commercial or legal interactions” i.e. agreements in the form of contracts; legal obligations, sales activities, business relations etc.
This judicial exception is not integrated into a practical application because the combination of additional elements of “a server computer”, “server-based program”, “smart contract” and “one or more logic processes” for establishing, receiving, tracking, calling, providing and transferring data are recited at a high-level of generality i.e., as a generic processor performing a generic computer function of sending, receiving, and processing data. These additional elements describe how to generally “apply” the judicial exception in a computer environment to automate the process without providing significantly more. Simply implementing the abstract idea on a generic computer is not a practical application of the abstract idea, see MPEP 2106.05 (f).
The claims do not include additional elements individually or in combination that are sufficient to amount to significantly more than the judicial exception because as discussed with respect to Step 2A Prong Two, the additional elements in the claim, as mentioned above, amount to no more than mere instructions to “apply” the judicial exception using a generic computer component. The steps in the claims are all well-understood, routine and conventional in the realm of transferring a net settlement value to or from the purchaser of the commodity.
The same analysis applies here in 2B, i.e., mere instructions to apply an exception using a generic computer component cannot integrate a judicial exception into a practical application at Step 2A or provide an inventive concept in Step 2B. The claim is ineligible. Claim 40 is rejected for analogous reasons.
The dependent claims 2-6, 8-11, 14, 16-18, 21-25, 27-35, 37, 39, 41, 43, 45, 47-51, 53 and 55 provide further descriptive limitations of elements. While these descriptive elements may provide further helpful context for the claimed invention, these elements do not serve to confer subject matter eligibility to the claimed invention since their individual and combined significance is still not heavier than the abstract concepts at the core of the claimed invention. The claims further define and limit the abstract idea without significantly more. For these reasons, claims 2-6, 8-11, 14, 16-18, 21-25, 27-35, 37, 39, 41, 43, 45, 47-51, 53 and 55 are ineligible under 35 USC 101.
Conclusion
THIS ACTION IS MADE FINAL. Applicant is reminded of the extension of time policy as set forth in 37 CFR 1.136(a).
A shortened statutory period for reply to this final action is set to expire THREE MONTHS from the mailing date of this action. In the event a first reply is filed within TWO MONTHS of the mailing date of this final action and the advisory action is not mailed until after the end of the THREE-MONTH shortened statutory period, then the shortened statutory period will expire on the date the advisory action is mailed, and any nonprovisional extension fee (37 CFR 1.17(a)) pursuant to 37 CFR 1.136(a) will be calculated from the mailing date of the advisory action. In no event, however, will the statutory period for reply expire later than SIX MONTHS from the mailing date of this final action.
Any inquiry concerning this communication or earlier communications from the examiner should be directed to TONY P KANAAN whose telephone number is (571)272-2481. The examiner can normally be reached on Monday- Friday 7:30am - 3:30 pm EST.
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/T.P.K./Examiner, Art Unit 3696
/MATTHEW S GART/Supervisory Patent Examiner, Art Unit 3696