DETAILED ACTION
Continued Examination Under 37 CFR 1.114
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and the fee set forth in 37 CFR 1.17(e) has been timely paid, the finality of the previous Office action has been withdrawn pursuant to 37 CFR 1.114.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 3/16/26 has been entered.
Status of the Claims
This office action is submitted in response to the RCE filed on 3/16/26.
Examiner notes Applicant’s priority date of 11/22/16, which stems from parent applications 17238502 and 15359141, which are now US Patent Nos. 11301891 and 11017421, respectively.
Examiner further notes the previous withdrawal of prior art on 10/26/22.
Examiner further notes that Applicant filed a terminal disclaimer on 1/26/23, which was subsequently approved by the Office on the same day.
Claims 1-20, 23, 26-27, 30, 33-34, 37, and 39-40 have been cancelled.
Claims 21, 28, and 35 have been amended.
Therefore, claims 21-22, 24-25, 28-29, 31-32, 35-36, and 38 are currently pending and have been examined.
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 .
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 21-22, 24-25, 28-29, 31-32, 35-36, and 38 are rejected under 35 U.S.C. 101 because the claimed invention is directed to a judicial exception (i.e., a law of nature, a natural phenomenon, or an abstract idea) without significantly more.
Under Step 1, the claimed subject matter must fall within one of the four statutory categories of 35 U.S.C. 101: a process, machine, manufacture, or composition of matter. See MPEP 2106.03. Claim 21 recites a method, which qualifies as a process. Claim 28 recites a system comprising one or more processors and memory, which qualifies as a machine. Claim 35 recites a non-transitory computer-readable medium storing computer-executable instructions, which qualifies as an article of manufacture. Accordingly, claims 21, 28, and 35 each fall within a statutory category, and the analysis proceeds to Step 2.
Next, independent claims 21, 28, and 35, in part, describe an invention comprising: receiving ACH data (including a routing number and an account number) associated with a payment vehicle presented at a POS system for execution of a purchase transaction; determining that the ACH data linked with the customer loyalty identifier reduces a fee to the merchant system; determining that payment using the ACH data is not enabled for the customer; prompting the customer to enable payment using the ACH data; prompting the customer to apply the ACH data to the purchase transaction, instead of the payment vehicle; and processing the purchase transaction using the ACH data. As such, the invention is directed to the abstract idea of providing a means for customers to enable and use an ACH payment method for a purchase transaction, which, pursuant to MPEP 2106.04, is aptly categorized as a method of organizing human activity (i.e., sales and commercial interactions). Therefore, under Step 2A, Prong One, the claims recite a judicial exception.
Next, the aforementioned claims recite additional elements that are associated with the judicial exception, including: capturing customer loyalty data by reading a magnetic stripe or chip of a loyalty card, reading a QR code from a mobile device display, or receiving an NFC signal; storing ACH data including a routing number and account number in a database linked to the customer loyalty identifier; storing an indication that ACH payment has been enabled; sending first display instructions to cause the POS system to display a first prompt and capture a first user interaction; in response, sending second display instructions to cause the POS system to display a second prompt overtop the display and capture a second user interaction to apply ACH; and sending a transaction authorization request and the ACH data to an acquirer processor. Examiner understands these limitations to be insignificant extra-solution activity. (See Accenture, 728 F.3d 1336, 108 U.S.P.Q.2d 1173 (Fed. Cir. 2013), citing Cf. Diamond v. Diehr, 450 U.S. 175, 191-192 (1981) ("[I]nsignificant post-solution activity will not transform an unpatentable principle into a patentable process.")).
The aforementioned claims also recite additional elements that are associated with the judicial exception, including: a "database" for storing payment information, ACH data, and loyalty identifier information; a "POS system" for processing a transaction and displaying prompts for the customer to select/apply a payment mechanism; a "merchant system" for executing the method; a "user interface" for capturing and displaying data; a "payment mechanism" for facilitating purchases; a "processor" to execute the method; a "memory" for storing computer-executable instructions; and a "non-transitory computer-readable medium" for storing executable data. These limitations are recited at a high level of generality, and appear to be nothing more than generic computer components. Claims that amount to nothing more than an instruction to apply the abstract idea using a generic computer do not render an abstract idea eligible. Alice Corp., 134 S. Ct. at 2358, 110 USPQ2d at 1983. See also 134 S. Ct. at 2389, 110 USPQ2d at 1984.
Furthermore, looking at the elements individually and in combination, under Step 2A, Prong Two, the claims as a whole do not integrate the judicial exception into a practical application because they fail to: improve the functioning of a computer or a technical field, apply the judicial exception in the treatment or prophylaxis of a disease, apply the judicial exception with a particular machine, effect a transformation or reduction of a particular article to a different state or thing, or apply the judicial exception beyond generally linking the use of the judicial exception to a particular technological environment. Rather, the claims merely use a computer as a tool to perform the abstract idea(s), and/or add insignificant extra-solution activity to the judicial exception, and/or generally link the use of the judicial exception to a particular technological environment (e.g. a POS network).
Next, under Step 2B, the claims do not include additional elements that are sufficient to amount to significantly more than the judicial exception because the additional elements, when considered both individually and as an ordered combination, do not amount to significantly more than the abstract idea. Furthermore, looking at the limitations as an ordered combination adds nothing that is not already present when looking at the elements taken individually. Simply put, as noted above, there is no indication that the combination of elements improves the functioning of a computer (or any other technology), and their collective functions are merely facilitated by generic computer implementation.
Additionally, pursuant to the requirement under Berkheimer, the following citations are provided to demonstrate that the additional elements, identified as extra-solution activity, amount to activities that are well-understood, routine, and conventional. See MPEP 2106.05(d).
Receiving or transmitting data over a network, e.g., using the Internet to gather data, Symantec, 838 F.3d at 1321, 120 USPQ2d at 1362; OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d at 1359, 1363, 115 USPQ2d 1090, 1093 (Fed. Cir. 2015); buySAFE, Inc. v. Google, Inc., 765 F.3d 1350, 1355, 112 USPQ2d 1093, 1096 (Fed. Cir. 2014).
Storing and retrieving information in memory, Versata Dev. Group, Inc. v. SAP Am., Inc., 793 F.3d 1306, 1334, 115 USPQ2d 1681, 1701 (Fed. Cir. 2015); OIP Techs., 788 F.3d at 1363, 115 USPQ2d at 1092-93.
Displaying prompts and capturing user input via a user interface: Interval Licensing LLC v. AOL, Inc., 896 F.3d 1335, 1348 (Fed. Cir. 2018).
Reading QR codes and extracting data from them. https://web.archive.org/web/20130512180619/http://www.nacs.org/LinkClick.aspx?fileticket=D1FpVAvvJuo%3d&tabid=1426&mid=4802.
Thus, taken alone and in combination, the additional elements do not amount to significantly more than the above-identified judicial exception (the abstract idea), and are ineligible under 35 USC 101.
Claims 22, 24-25, 29, 31-32, 36, and 38 are dependent on the aforementioned independent claims, and include all the limitations contained therein. These claims do not recite any additional technical elements, and simply disclose additional limitations that further limit the abstract idea with details regarding customer authorization, incentivizing the customer, the content of the authorization information, and the data associated with the payment instrument (ACH data). Thus, the dependent claims merely provide additional non-structural (and predominantly non-functional) details that fail to meaningfully limit the claims or the abstract idea(s).
Therefore, claims 21-22, 24-25, 28-29, 31-32, 35-36, and 38 are not drawn to eligible subject matter, as they are directed to an abstract idea without significantly more.
Relevant Prior Art
The following references are made of record and not relied upon, as they are deemed to be pertinent to Applicant’s disclosure.
Khan et al. (20180260833), directed to a method for displaying various financial and non-financial incentives.
Radu et al. (20150254662), directed to a method for verifying transaction context data at a wallet service provider.
Mohsenzadeh et al. (20140257977), directed to a method for managing a payment transaction.
Rackley et al. (20080040265), directed to a method for making a payment via a stored value card in a mobile environment.
Response to Arguments
Applicant’s arguments regarding the sufficiency of the claims under 35 USC 101 remain unpersuasive.
First, Applicant contends that the claims do not recite a judicial exception. Examiner respectfully disagrees. The claims are directed to the concept of receiving a customer's ACH payment data at a point of sale, determining that ACH reduces the merchant's fee, enrolling the customer in ACH payment on the spot, and redirecting the live purchase transaction from the originally-presented payment vehicle to ACH. This is precisely the kind of commercial and sales interaction (specifically, the management of a customer payment enrollment and transaction routing process) that the USPTO and Federal Circuit have consistently recognized as a method of organizing human activity under Step 2A, Prong 1. See MPEP § 2106.04(a)(2)(III). Examiner also notes that the concept at the heart of these claims — persuading a customer to use a preferred payment method mid-transaction and then processing accordingly — is one that could be performed mentally or by a human merchant, without any particular computer implementation. That the claims specify a merchant system, POS terminal, and acquirer processor to carry out the steps does not negate the abstract nature of the underlying concept. See Alice Corp. v. CLS Bank Int'l, 573 U.S. 208, 222 (2014) ("the mere recitation of a generic computer cannot transform a patent-ineligible abstract idea into a patent-eligible invention."). Accordingly, the claims recite a judicial exception under Step 2A, Prong 1.
that the Claims Integrate the Judicial Exception into a Practical Application (Step 2A, Prong 2)
Next, Applicant argues that the amended claims improve "at least the functioning of the merchant system (e.g., a computing device)" by virtue of (1) the second display instructions being sent in response to capturing the first user interaction, causing the POS to display a second prompt overtop the display and capture a second user interaction to apply ACH in real time, and (2) the transaction authorization request being sent using the ACH data and not the payment vehicle, based on the captured second user interaction. Examiner is not persuaded that these elements constitute a technical improvement to the functioning of the merchant system or any other computer component.
Applicant's framing conflates a business process improvement with a technical improvement. The sequence described — detect a user interaction, send display instructions to show a follow-up prompt, capture a second user interaction, send an authorization request using the selected data — describes a conventional, generic request-response interaction model applied to a new commercial context. Every component in this sequence (processor, display, user input capture, network transmission to an acquirer) performs exactly its ordinary, expected function. The merchant system is not faster, more efficient, more reliable, or structurally altered. Its processors, memory, network interfaces, and display hardware all operate in their conventional manner. The only thing that has changed is which data (ACH versus card) is packaged into the authorization request — a business rule, not a technical improvement.
This is precisely the distinction the Federal Circuit drew in Electric Power Group, LLC v. Alstom S.A., 830 F.3d 1350, 1354 (Fed. Cir. 2016), where the court held that "collecting information, analyzing it, and displaying certain results of the collection and analysis" does not improve computers or networks as such. Similarly, in Interval Licensing LLC v. AOL, Inc., 896 F.3d 1335, 1348 (Fed. Cir. 2018), the court found that displaying content in a particular manner using standard display hardware did not reflect a technical improvement to display technology. The present claims are analogous — displaying a second overlay prompt and capturing a second user input via a POS display represents routine, conventional UI operation, and not a technical advance.
Next, Applicant's argument that "conventional merchant systems transmit transaction information to an acquirer processor for processing using a payment vehicle presented at the time of the transaction" and that the claims improve upon this by substituting ACH mid-transaction does not establish patent eligibility. Under Alice and Mayo, an abstract idea does not become patent-eligible simply because it is novel or because prior art systems did not perform the specific commercial process. Novelty and eligibility are separate inquiries. See Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66, 90 (2012) ("[T]he novelty of the abstract idea does not make it non-abstract."). The claimed "improvement" is to the business outcome (transacting payment through a lower-cost channel) not to any technical aspect of the computer systems used to effectuate that outcome.
Contrast this with cases where courts found a practical application: in Enfish, LLC v. Microsoft Corp., 822 F.3d 1327 (Fed. Cir. 2016), the claims were directed to a specific, unconventional database architecture (a self-referential table) that improved the way data was stored and retrieved by the computer itself. In McRO, Inc. v. Bandai Namco Games Am. Inc., 837 F.3d 1299 (Fed. Cir. 2016), the claims employed a specific set of rules to automate a process previously requiring human judgment, producing a technical improvement to computer animation. Here, no analogous technical improvement is present. The merchant system's processors, POS display, database, and network components all function exactly as they always have — they are used as tools to carry out the abstract commercial enrollment and routing process. Use of a computer as a tool to perform an abstract idea, without more, does not integrate the exception into a practical application. See MPEP § 2106.05(f).
Therefore, for at least these reasons, the rejection under 35 USC 101 is sustained.
Conclusion
Any inquiry concerning this communication or earlier communications from the examiner should be directed to CHRISTOPHER BUSCH whose telephone number is (571)270-7953. The examiner can normally be reached M-F 10-7.
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If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, Waseem Ashraf can be reached at 571-270-3948. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300.
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/CHRISTOPHER C BUSCH/Examiner, Art Unit 3621
/WASEEM ASHRAF/Supervisory Patent Examiner, Art Unit 3621
