DETAILED ACTION
Notice of Pre-AIA or AIA Status
1. The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA .
Response to Amendment
2. The Amendment filed on September 04, 2025 has been entered. Claims 1, 9, and 15 have been amended. No claims have been cancelled or added. Thus, claims 1-20 are pending and rejected for the reasons set forth below.
Claim Rejections - 35 USC § 101
3. 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.
4. Claims 1-20 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.
In sum, claims 1-20 are rejected under 35 U.S.C. §101 because the claimed invention is directed to a judicial exception to patentability (i.e., a law of nature, a natural phenomenon, or an abstract idea) and do not include an inventive concept that is something “significantly more” than the judicial exception under the January 2019 patentable subject matter eligibility guidance (2019 PEG) analysis which follows.
Under the 2019 PEG step 1 analysis, it must first be determined whether the claims are directed to one of the four statutory categories of invention (i.e., process, machine, manufacture, or composition of matter). Applying step 1 of the analysis for patentable subject matter to the claims, it is determined that the claims are directed to the statutory category of a process (claims 9-18) and a machine (claims 1-8 and 15-20), where the machine are substantially directed to the subject matter of the process. (See, e.g., MPEP §2106.03). Therefore, we proceed to step 2A, Prong 1.
Under the 2019 PEG step 2A, Prong 1 analysis, it must be determined whether the claims recite an abstract idea that falls within one or more designated categories of patent ineligible subject matter (i.e., organizing human activity, mathematical concepts, and mental processes) that amount to a judicial exception to patentability. Here, the claims recite the abstract idea of determining a VAT percentage for a transaction based on user data and then processing a transaction based on this by:
serving a merchant configuration interface to a merchant for selecting, in merchant configuration settings, to designate control for VAT determination to the VAT calculation engine, to not process a payment transaction until the VAT calculation engine returns a successful calculation message and one or more consumer parameters for a merchant ecommerce portal;
at the merchant ecommerce portal configured by the merchant configuration settings to designate control for VAT determination to the VAT calculation engine:
obtaining data associated with the payment transaction for the one or more consumer parameters selected in the merchant configuration settings using a VAT calculation plugin, and
in response to receiving a user input selecting a purchase selector for the payment transaction, sending a purchase request for the payment transaction and also transmit at least one of a plurality of VAT calculation parameters including the data for the one or more consumer parameters the payment checkout…;
at the payment checkout…configured by the merchant configuration settings to not process the payment transaction until the successful calculation message from the VAT calculation engine thereby giving control to the VAT calculation engine to deny the payment transaction upon a failure in the VAT determination:
in response to receiving the purchase request for the payment transaction, hold processing the payment transaction until the VAT calculation engine returns the successful calculation message, and sending a request for a VAT calculation and transmitting the at least one of the plurality of VAT calculation parameters including the data for the one or more consumer parameters to the VAT calculation engine;
at the VAT calculation engine:
in response to receiving the request for the VAT calculation from the payment checkout…, determining a location of a consumer based upon the data the one or more consumer parameters;
performing a determination of a VAT percentage based upon the at least one of the plurality of VAT calculation parameters and the location of the consumer thereby reducing memory requirements local to the ecommerce portal and the payment checkout,…,;
if the determination is successful, then
transmitting the determined VAT percentage to the payment checkout along with the successful calculation message that indicates the payment transaction can be processed thereby reducing processing demands local to the ecommerce portal and the payment checkout,…,;
sending a request for transfer of VAT funds for the payment transaction to the payment checkout…; and
receiving a confirmation of the transfer of VAT funds from the payment checkout; else
transmitting a failure message that indicates that the payment transaction cannot be processed to cause the payment checkout to refrain from processing the payment transaction thereby reducing processing demands at the payment checkout,…;
at the payment checkout…:
processing the payment transaction and transmitting transaction details to the merchant ecommerce portal in response to receiving the successful calculation message, and
in response to receiving the failure message, refraining from processing the payment transaction as directed by the merchant configuration settings and sending a prompt to display a purchase denied message to the merchant ecommerce portal.
Here, the recited abstract idea falls within one or more of the three enumerated 2019 PEG categories of patent ineligible subject matter, to wit: the category of certain methods of organizing human activity, which includes fundamental economic practices or principles and commercial or legal interactions (e.g., determining a VAT percentage for a transaction based on user data and then processing a transaction based on this).
Under the 2019 PEG step 2A, Prong 2 analysis, the identified abstract idea to which the claim is directed does not include limitations that integrate the abstract idea into a practical application, since the recited features of the abstract idea are being applied on a computer or computing device or via software programming that is simply being used as a tool (“apply it”) to implement the abstract idea. (See, e.g., MPEP §2106.05(f)). Therefore, the claim is directed to an abstract idea. Independent claims 1 and 15 are nearly identical to independent claim 9 so the same analysis applies to those two claims as well. Claims 1 and 15 both include additional elements such as a “memory” and “server” which is being used to implement the abstract idea noted in claim 9.
Under the 2019 PEG step 2B analysis, the additional elements are evaluated to determine whether they amount to something “significantly more” than the recited abstract idea. (i.e., an innovative concept). Here, the additional elements, such as: a “processor,” “module,” and “system,” do not amount to an innovative concept since, as stated above in the step 2A, Prong 2 analysis, the claims are simply using the additional elements as a tool to carry out the abstract idea (i.e., “apply it”) on a computer or computing device and/or via software programming. (See, e.g., MPEP §2106.05(f)). The additional elements are specified at a high level of generality to simply implement the abstract idea and are not themselves being technologically improved. (See, e.g., MPEP §2106.05 I.A.); (see also, paragraph [0003] of the specification).
Dependent claims 2–8, 10–14, and 16–20 have all been considered and do not integrate the abstract idea into a practical application. Dependent claims 2, 10, and 16 recite nearly identical limitations that further define the abstract idea noted in claim 9 in that they describe what the VAT calculation parameters are and what they can consist of. These parameters deal with the consumer payment data to identify the consumer when the transaction is taking place. Dependent claims 3-5, 11, and 17-18 recite nearly identical limitations that further define the abstract idea noted in claim 9 in that they describe how the location of the consumer is determined and this is how the location information is extracted (using the consumer’s billing address, payment address, VAT number of the consumer, or the IP address of the consumer). This is a simple extraction of specific data of the consumer. Dependent claims 6, 12, and 19 recite nearly identical limitations that further define the abstract idea noted in claim 9 in that they describe what the VAT calculation paraments specifically are and how they encompass several goods and services parameters that include the particular good or service and information pertaining to it. This has to do with extracting specific information of the transaction to determine the VAT amount based on the transaction information (the particular good or service being used). Dependent claims 7, 13, and 20 recite nearly identical limitations that further define the abstract idea noted in claim 9 in that they describe that the determination of the VAT percentage is based on the identity of the good or service. This establishes that information pertaining to the VAT amount is gathered based on what the consumer is buying in terms of the particular good or service as part of the transaction. Dependent claims 8 and 14 recite nearly identical limitations that further define the abstract idea noted in claim 9 in that they describe a particular situation in which a VAT refund is performed and receiving a message confirming such a refund has taken place. This is sending information about an event occurring (“a refund confirmation”).
The elements of the instant process steps when taken in combination do not offer substantially more than the sum of the functions of the elements when each is taken alone. The claims as a whole, do not amount to significantly more than the abstract idea itself because the claims do not effect an improvement to another technology or technical field (e.g., the field of computer coding technology is not being improved); the claims do not amount to an improvement to the functioning of an electronic device itself which implements the abstract idea (e.g., the general purpose computer and/or the computer system which implements the process are not made more efficient or technologically improved); the claims do not perform a transformation or reduction of a particular article to a different state or thing (i.e., the claims do not use the abstract idea in the claimed process to bring about a physical change. See, e.g., Diamond v. Diehr, 450 U.S. 175 (1981), where a physical change, and thus patentability, was imparted by the claimed process; contrast, Parker v. Flook, 437 U.S. 584 (1978), where a physical change, and thus patentability, was not imparted by the claimed process); and the claims do not move beyond a general link of the use of the abstract idea to a particular technological environment (e.g., simply claiming the use of a computer and/or computer system to implement the abstract idea).
Prior Art Not Relied Upon
5. The prior art made of record and not relied upon is considered pertinent to Applicant’s disclosure. (See MPEP §707.05). The Examiner considers the following reference pertinent for disclosing various features relevant to the invention, but not all the features of the invention, for at least the following reasons:
1. Bhambhani (U.S. Pub. No. 2015/0127534) teaches a system for electronic refund redemption for identifying a VAT amount for purchased product. Although Bhambhani describes determining an amount of VAT tied to a transaction similar to the current invention, Bhambhani does not disclose the following limitations as part of the current invention:
“determining a location of a consumer based upon the at least one of the plurality of
VAT calculation parameters;
performing a determination of a VAT percentage based upon the at least one of the
plurality of VAT calculation parameters and the location of the consumer;
if the determination is successful, then transmitting the determined VAT percentage to the payment processor server system along with a successful calculation message that indicates the payment transaction can be processed…
transmitting a failure message that indicates that the payment transaction cannot be processed to cause the payment processor server system to refrain from processing the
payment transaction.”
These limitations discuss the features relating to determining the VAT amount based on the location of the consumer tied to VAT calculation parameters and then allowing the transaction to go through. In addition, if this VAT calculation fails to occur, then the transaction is prevented from going through. This is not found in the prior art, including Bhambhani.
Response to Arguments
6. Applicant’s arguments filed on September 04, 2025 have been fully considered.
Applicant argues that “[a]mended claim 1 defines eligible subject matter that is not within any judicial exception for at least the reason that the proposed claim 1 as whole amounts to significantly more than the asserted abstract idea of determining a VAT percentage for a transaction based on user data and then processing a transaction based on this.” (See Applicant’s Arguments, p. 17). Applicant also argues that “amended claim 1 as an ordered combination demonstrates a technologically rooted solution to the Internet-centric problem determining the valid VAT calculation during processing of the payment transaction.” Id. at p. 19. However, there is no specialized hardware or software that is part of this invention to give credence to this claim. Simply offloading performing VAT calculations from a point-of-sale system to a generic server does not make this a technological improvement. Instead, this invention is using generic components to performing VAT calculations based on the rules of the particular jurisdiction where the transaction is taking place. Also, sending VAT calculation parameters ahead of time is not a technological improvement.
Hence, for these reasons and those cited above, the previously cited rejection under 35 U.S.C. §101 is maintained.
Conclusion
Accordingly, THIS ACTION IS MADE FINAL. See MPEP § 706.07(a). 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 extension fee 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 date of this final action.
Any inquiry concerning this communication or earlier communications from the Examiner should be directed to Amit Patel whose telephone number is (313) 446-4902. The Examiner can normally be reached Mon - Thu 8 AM - 6 PM EST. If attempts to reach the Examiner by telephone are unsuccessful, the Examiner’s supervisor, Matthew Gart, can be reached at (571) 272-3955. The Examiner’s fax number is (571) 273-6087. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300.
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/Amit Patel/
Examiner, Art Unit 3696
/MATTHEW S GART/Supervisory Patent Examiner, Art Unit 3696