DETAILED ACTION
Notice of 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 reply to the request for continued examination filed on October 5, 2025.
Claim 1 has been amended and is hereby entered.
Claims 7–12 have been canceled.
Claims 1–6 are currently pending and have been examined.
Continued Examination
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and the fee set forth in 37 CFR 1.17(e) has been timely paid, the finality of the previous Office action has been withdrawn pursuant to 37 CFR 1.114.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 October 5, 2025 has been entered.
Response to Amendment
The amendment filed October 5, 2025 has been entered. Claims 1–6 remain pending in the application.
Claim Rejections - 35 USC § 101
The following is a quotation of 35 U.S.C. 101:
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 are rejected under 35 U.S.C. 101 because the claimed invention is directed to an abstract idea without significantly more.
First of all, claims must be directed to one or more of the following statutory categories: a process, a machine, a manufacture, or a composition of matter. Claims 1–6 are directed to a process (“A method”). Thus, claims 1–6 satisfy Step One because they are all within one of the four statutory categories of eligible subject matter.
Claims 1–6, however, are directed to an abstract idea without significantly more. For claim 1, the specific limitations that recite an abstract idea are:
generating a transaction initiation . . .;
triggering, by the transaction initiation, transmission, . . . to . . . a first processing entity, a request for a second . . . Shard ID, . . . ;
wherein a Shard ID is a unique ID, . . . storing a previous subset of customer transactions in a particular chronological sequence, said Shard ID being based at least in part on the previous subset of customer transactions in said particular chronological sequence;
transmitting, . . . the second . . . Shard ID;
receiving . . ., the second . . . Shard ID;
triggering, by the request for a second . . . Shard ID, transmission, . . . to . . . a second processing entity, a request for a first . . . Shard ID, . . .;
transmitting, from the second processing entity . . ., the first . . . Shard ID;
receiving, . . ., the first . . . Shard ID;
generating a transaction request . . ., said transaction request comprising:
a first . . . Shard ID . . .;
the second . . . Shard ID . . .;
transmitting the transaction request . . .;
processing the transaction request . . . based on the first . . . Shard ID and the second . . . Shard ID; and
receiving, . . . approval . . .;
generating a transaction request . . . , said transaction request comprising:
a first . . . Shard ID . . . ;
the second . . . Shard ID . . . ;
transmitting the transaction request . . .;
processing the transaction request at the second processor based on the first . . . Shard ID and the second . . . Shard ID;
receiving, . . . approval from the second processor;
comparing the first . . . Shard ID and the second . . . Shard ID, and, when the first . . . Shard ID and the second . . . Shard ID are determined, based on the comparison, to be identical, increasing . . ., a logical counter . . ., and, when the first . . . Shard ID and the second . . . Shard ID are determined, based on the comparison, to be different, then maintaining the logical counter . . . at a current level; . . .
enabling authentication of the transaction and authentication . . . within a threshold distance . . ., said enabling being based at least on the first . . . Shard ID and the second . . . Shard ID.
The claims, therefore, recite initiating, approving, and recording a transaction, which is the abstract idea of certain methods of organizing human activity because they recite a commercial interaction and the fundamental economic practice of mitigating risk.
The judicial exception recited above is not integrated into a practical application. The additional elements of the claims are various generic technologies and computer components to implement this abstract idea (“smartwatch”, “memory”, “Tempo Radix”, “artificial intelligence”, and “fraud detection controller”). The claims also recite “displaying, at the first smartwatch and at the second smartwatch, a status of the transaction”. These additional elements are not integrated into a practical application because the invention merely applies the abstract idea to generic computer technology, using the computer to initiate, communicate, and approve the transaction, and then record the result. Claim 1 does introduce a more specific technology, Tempo Radix, but again, this is merely being used as a generic tool to implement the abstract idea above. The logical counter only provides an alternative means for recording and validating the transaction, rather than creating any type of improvement to the technology itself. Because the invention is using the computer simply as a tool to perform the abstract idea on, the judicial exception is not integrated into a practical application.
Finally, the claims do not include additional elements that are sufficient to amount to significantly more than the judicial exception because, as discussed above, the additional elements in combination are at a high level of generality such that they amount to no more than mere instructions to apply the abstract idea using generic components. Because merely “applying” the exception using generic computer components cannot provide an inventive concept, the additional elements do not recite significantly more than the judicial exception. Thus, claim 1 is not patent eligible.
Dependent claims 2–6 have been given the full two part analysis, analyzing the additional limitations both individually and in combination. The dependent claims, when analyzed individually and in combination, are also held to be patent ineligible under 35 U.S.C. 101.
For claims 2 and 3, the additional recited limitations of these claims merely further narrow the abstract idea discussed above. These dependent claims only narrow the transaction recited in claim 1 by further specifying how the transaction is approved—“validating the Shard IDs . . . by comparing the previous subsets of customer transactions” and “controls the first and second processors’ transaction based on the fraud statuses”. The limitations of these claims fail to integrate the abstract idea into a practical application because these claims do not introduce additional elements other than the generic components discussed above (“smartwatch”). These claims do recite an artificial intelligence-based validator and a fraud detection controller, but again, these are also merely being used as a tools to validate the transaction. The artificial intelligence and fraud detection controller only provide alternative means for confirm a user, rather than creating any type of improvement to the technology itself. These dependent claims, therefore, also amount to merely using a computer, in its ordinary capacity, as a tool to perform the abstract idea. Finally, the additional recited limitations of these dependent claims fail to establish that the claims provide an inventive concept because claims that merely use a computer, in its ordinary capacity, as a tool to perform the abstract idea cannot provide an inventive concept.
For claim 4, the additional recited limitations of this claim merely further narrow the abstract idea discussed above. This dependent claim only narrows the transaction recited in claim 1 by further specifying the information recorded—“transaction denial and approval”. The limitations of this claim fail to integrate the abstract idea into a practical application because this claim does not introduce additional elements other than the generic components discussed above (“Tempo Radix”). This dependent claim, therefore, also amounts to merely using a computer, in its ordinary capacity, as a tool to perform the abstract idea. Finally, the additional recited limitations of this dependent claim fails to establish that the claim provides an inventive concept because claims that merely use a computer, in its ordinary capacity, as a tool to perform the abstract idea cannot provide an inventive concept.
For claims 5 and 6, the additional recited limitations of these claims merely further narrow the abstract idea discussed above. These dependent claims only narrow the transaction recited in claim 1 by further specifying the transaction type—“transfer of funds”, and “beneficiary . . . is the account associated with the second . . . and a benefactor . . . is the account associated with the first”. The limitations of these claims fail to integrate the abstract idea into a practical application because these claims do not introduce additional elements other than the generic components discussed above (“smartwatch”). These dependent claims, therefore, also amount to merely using a computer, in its ordinary capacity, as a tool to perform the abstract idea. Finally, the additional recited limitations of these dependent claims fail to establish that the claims provide an inventive concept because claims that merely use a computer, in its ordinary capacity, as a tool to perform the abstract idea cannot provide an inventive concept.
Response to Arguments
Claim Rejections Under 35 U.S.C. § 101
Applicant’s arguments filed on October 5, 2025 have been fully considered but they are not persuasive.
Applicant argues that the claims recite authentication of smartwatches within a threshold distance and therefore cannot be performed in the human mind. Applicant cites a USPTO Memo regarding Patent Subject Matter Eligibility and explains that claims that cannot be performed in human mind do not recite a mental process. The claims, however, are not alleged to be directed to a mental process, but are instead rejected as being directed to certain methods of organizing human activity. The claims recite a transaction, even if they further recite smartwatch technology to implement the transaction. Thus, claims 1–6 are directed to an abstract idea.
Next, Applicant argues that the claims are integrated into a practical application and recite significantly more than the judicial exception because they recite a technological improvement. Applicant explains that the claims improve smartwatch technology because they provide additional security to smartwatch transaction processing. The claims authenticate smartwatches located within a threshold distance using Shard IDs, which Applicant argues is an improvement to technology that cannot be performed in the human mind. The claims, however, are improving the transaction itself through this authentication, by merely applying the smartwatch technology. Rather than improving the technology itself in any way, the claims are instead merely using the technology as a tool to implement the abstract idea. Thus, claims 1–6 do not include additional elements sufficient to integrate the claims into a practical application or recite significantly more than the judicial exception.
Prior Art Not Relied Upon
The prior art made of record and not relied upon is considered pertinent to Applicant’s disclosure. Those prior art references are as follows:
Gupta, U.S. Patent No. 11,308,474, discloses payments between smartwatches using telephone numbers.
Syed et al., U.S. Patent App. No. 2013/0305335, discloses transactions between devices including device identifiers associated with a transaction history.
De Caro et al., U.S. Patent App. No. 2022/0004539, discloses transactions with shards and associated transaction identifiers.
Rusnac, Is Radix the Coolest Thing Happening in Crypto Right Now, https://hackernoon.com/is-radix-the-coolest-thing-happening-in-crypto-right-now-ca1596cf7307 (Nov. 20, 2018), discloses a Radix network including nodes with a logical clock that increments by 1 with each event.
Tempo – Consensus Lessons Learned, The Radix Blog, https://www.radixdlt.com/blog/tempo-consensus-lessons-learned (August 31, 2020), discloses increasing a node logical clock counter with a new request.
Conclusion
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/DIVESH PATEL/Examiner, Art Unit 3696