DETAILED ACTION
1. The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA . This Office action is in response to Applicant’s communication filed on December 17, 2025. Amendments to claims 1, and 4, cancellation of claim 3 and addition of new claims 6-9 have been entered. Claims 1, 2 and 4-9 are pending and have been examined. The rejections and response to arguments are stated below.
Claim Rejections - 35 USC § 101
2. 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.
3. Claims 1, 2, and 4-9 are rejected under 35 U.S.C. § 101 because the claimed invention is directed to an abstract idea without significantly more. The claim recites a method based on determining the outcome meets the winning parameter, generating and transmitting, by the second network interface, a remote execution command to the first computing device, wherein the remote execution command causes the first computing device to modify the data value in the first memory, so as to transfer the monetary risk amount to a second user account, which is considered a judicial exception because it falls under the category of certain of methods of organizing human activity such as a fundamental economic activity as well as commercial or legal interactions including agreements in the form of contracts as discussed below. This judicial exception is not integrated into a practical application as discussed below. The claim(s) does/do not include additional elements that are sufficient to amount to significantly more than the judicial exception as discussed below.
Analysis
Step 1: In the instant case, claim 1 is directed to a process.
Step 2A – Prong One: The limitations of “A method for operation in a system comprising:
operating, by a first computing device having a first network interface, a first processor and a first memory, an electronic marketplace; and
operating, by a second computing device having a second network interface, a second processor and a second memory, an electronic clearinghouse;
executing, by the first computing device:
receiving, by the first a network interface, information defining a winning parameter of a contest;
listing, by the first network interface, a financial instrument that gives a holder of the financial instrument a right to a payment based on an outcome the contest and the winning parameter;
receiving, by the first network interface, an offer to sell the financial instrument at a first price from a first user terminal based on actuation of one of more controls included in a first user interface to cause transmission of the offer to the first computing device;
receiving, by the first network interface, a bid to buy the financial instrument at the first price from a second user terminal based on actuation of one of more controls included in a second user interface to cause transmission of the bid to the first computing device;
matching, by the first processor, the offer for the first price, the offer and the bid, wherein the matching is based on a pro-rata filing mode or a first come first service mode;
executing, by the first processor, a local locking operation in the first memory to prevent modification of a data value corresponding to a monetary risk amount in a first user account,
transmitting, by the first network interface, match data characterizing a trade to the second computing device; and
executing, by the second computing device:
instantiating, in the second memory, an obligation data structure based on the match data,
monitoring, by the second network interface, an external data feed to determine an outcome of the contest,
determining, via the monitored external data feed, that the outcome of the contest meets the winning parameter, and
based on determining the outcome meets the winning parameter, generating and transmitting, by the second network interface, a remote execution command to the first computing device, wherein the remote execution command causes the first computing device to modify the data value in the first memory, so as to transfer the monetary risk amount to a second user account” as drafted, when considered collectively as an ordered combination without the italicized portions, is a process that, under the broadest reasonable interpretation, covers methods of organizing human activity such as a fundamental economic activity such as mitigating risk as well as commercial or legal interactions including agreements in the form of contracts.
Transferring the monetary risk amount to a second user account is a fundamental economic activity such as mitigating risk.
Also, “transmitting, by the first network interface, match data characterizing a trade to the second computing device ….. determining, via the monitored external data feed, that the outcome of the contest meets the winning parameter, and based on determining the outcome meets the winning parameter, generating and transmitting, by the second network interface, a remote execution command to the first computing device, wherein the remote execution command causes the first computing device to modify the data value in the first memory, so as to transfer the monetary risk amount to a second user account” is a form of fulfilling agreements between the entities representing the bid and the offer respectively.
That is, other than, a first computing device having a first network interface, a first processor and a first memory, an electronic marketplace; a second computing device having a second network interface, a second processor and a second memory, an electronic clearinghouse; user interfaces including one or more controls, and two user terminals nothing in the claim precludes the steps from being performed as a method of organizing human activity. Hence, the additional elements in the claims are all generic components suitably programmed to perform their respective functions. If the claim limitations, under the broadest reasonable interpretation, covers methods of organizing human activity but for the recitation of generic computer components, then it falls within the “Certain methods of organizing human activity” grouping of abstract ideas. Accordingly, the claim recites an abstract idea.
Step 2A – Prong Two: The judicial exception is not integrated into a practical application. In particular, the claim only recites an additional elements of two computing devices including processors, memories, network interfaces, an electronic marketplace and an electronic clearinghouse, and user interfaces including one or more controls, and two user terminals to perform all the steps. A plain reading of Figure 1-2 and associated descriptions in at least paragraphs [0039] –[0041], [0055] – [0056], [0180] – [0191] reveals that the computing devices may include suitably programmed general-purpose computers. The processors of these computers may be generic processors suitably programmed to perform the claimed steps. The user interfaces including one or more controls, and the network interfaces are broadly interpreted to include generic computer network components suitably programmed to perform the associated steps. The electronic marketplace and the electronic clearinghouse are a part of the two computing devices. Similarly, the two user terminals user interfaces each including one or more controls are broadly interpreted to include generic computer terminals suitably programmed to perform the associated steps. Hence, the additional elements in the claims are all generic components suitably programmed to perform their respective functions. The additional elements in all the steps is recited at a high-level of generality (i.e., as a generic processor performing generic computer functions) such that it amounts no more than mere instructions to apply the exception using generic computer components. Accordingly, this additional element does not integrate the abstract idea into a practical application because it does not impose any meaningful limits on practicing the abstract idea. Hence, claim 1 is directed to an abstract idea.
Step 2B: The claim does not include additional elements that are sufficient to amount to significantly more than the judicial exception. As discussed above with respect to integration of the abstract idea into a practical application, the additional elements (identified above) to perform the claimed steps amount to no more than mere instructions to apply the exception using generic computer components. The additional elements of the instant underlying process, when taken in combination, together do not offer substantially more than the sum of the functions of the elements when each is taken alone. Mere instructions to apply an exception using a generic computer component cannot provide an inventive concept. Hence, independent claim 1 is not patent eligible. Claim 6 is also not patent eligible based on similar reasoning and rationale.
Dependent claims 2, 4-5, and 7-9 when analyzed as a whole are held to be patent ineligible under 35 U.S.C. 101 because the additional recited limitations only refine the abstract idea further.
For instance, in claims 2 and 7, the step “in which the contest includes a fantasy sports game” under the broadest reasonable interpretation, is a further refinement of methods of organizing human activity such as commercial interactions, because it describes environment in which the abstract idea is applied.
In claims 4 and 8, the step “in which facilitating the trade includes controlling the second computing device, to make the trade” describes the functionality of the computing device and as such is a further refinement of methods of organizing human activity such as commercial interactions.
In claims 5 and 9, the step “in which the winning parameter includes a line” under the broadest reasonable interpretation, is a further refinement of methods of organizing human activity such as commercial interactions because it describes the winning parameter of the contest.
In all the dependent claims, the judicial exception is not integrated into a practical application because the limitations are recited at a high-level of generality such that it amounts no more than mere instructions to apply the exception using generic computer components. Also the claims do not affect an improvement to another technology or technical field; the claims do not amount to an improvement to the functioning of a computer system itself; the claims do not affect a transformation or reduction of a particular article to a different state or thing; and the claims do not move beyond a general link of the use of an abstract idea to a particular technological environment. In addition, the dependent claims do not include additional elements that are sufficient to amount to significantly more than the judicial exception. The additional elements of the instant underlying process, when taken in combination, together 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. For these reasons, the dependent claims also are not patent eligible.
Response to Arguments
6. In response to Applicant’s assertion on pages 7-10 of the remarks that, the claims are not directed to merely an abstract idea and that the claims recite significantly more than any abstract idea, the Examiner respectfully disagrees.
The claim recites a method based on determining the outcome meets the winning parameter, generating and transmitting, by the second network interface, a remote execution command to the first computing device, wherein the remote execution command causes the first computing device to modify the data value in the first memory, so as to transfer the monetary risk amount to a second user account, which is considered a judicial exception because it falls under the category of certain of methods of organizing human activity such as a fundamental economic activity as well as commercial or legal interactions including agreements in the form of contracts as discussed in the rejection.
Transferring the monetary risk amount to a second user account is a fundamental economic activity such as mitigating risk.
Also, “transmitting, by the first network interface, match data characterizing a trade to the second computing device ….. determining, via the monitored external data feed, that the outcome of the contest meets the winning parameter, and based on determining the outcome meets the winning parameter, generating and transmitting, by the second network interface, a remote execution command to the first computing device, wherein the remote execution command causes the first computing device to modify the data value in the first memory, so as to transfer the monetary risk amount to a second user account” is a form of fulfilling agreements between the entities representing the bid and the offer respectively.
That is, other than, two computing devices including processors, memories, network interfaces, an electronic marketplace and an electronic clearinghouse, and user interfaces including one or more controls, and two user terminals to perform all the steps. A plain reading of Figure 1-2 and associated descriptions in at least paragraphs [0039] –[0041], [0055] – [0056], [0180] – [0191] reveals that the computing devices may include suitably programmed general-purpose computers. The processors of these computers may be generic processors suitably programmed to perform the claimed steps. The user interfaces including one or more controls, and the network interfaces are broadly interpreted to include generic computer network components suitably programmed to perform the associated steps. The electronic marketplace and the electronic clearinghouse are a part of the two computing devices. Similarly, the two user terminals user interfaces each including one or more controls are broadly interpreted to include generic computer terminals suitably programmed to perform the associated steps. Hence, the additional elements in the claims are all generic components suitably programmed to perform their respective functions. Accordingly, these additional elements do not integrate the abstract idea into a practical application because it does not impose any meaningful limits on practicing the abstract idea. Hence, the claims recite an abstract idea.
The claimed features including those recited on pages 8-9 such as “the first device performs a local locking operation on certain data values (i.e., representative of funds) due to relevance to a trade/wager, and the second device transmits a remote execution command back to the first device to release the lock when the appropriate external condition is detected …. distributed system architecture which maintains data integrity between two distinct computing nodes (i.e., the first and second computing devices). Furthermore, each computing node performs distinct functions in interoperation with the other. The first computing node maintains custody of certain resource data (i.e., representative of a risked monetary value) and performs the lock operation on the same in memory to prevent modification (i.e., barring usage of the represented funds). …..The second computing device in contrast maintains logic (e.g., monitoring of external events) and controls whether to release the lock. If, based on detect context, the lock is to be released, the second computing device transmits a command to do the same back to the first computing device” may at best be characterized as an improvement in the abstract idea of a method based on determining the outcome meets the winning parameter, generating and transmitting, by the second network interface, a remote execution command to the first computing device, wherein the remote execution command causes the first computing device to modify the data value in the first memory, so as to transfer the monetary risk amount to a second user account, using the additional elements to apply the abstract idea. An improvement in abstract idea is still abstract (SAP America v. Investpic *2-3 (“We may assume that the techniques claimed are “groundbreaking, innovative, or even brilliant,” but that is not enough for eligibility. Association for Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. 576, 591 (2013); accord buySAFE, Inc. v. Google, Inc., 765 F.3d 1350, 1352 (Fed. Cir. 2014). Nor is it enough for subject-matter eligibility that claimed techniques be novel and nonobvious in light of prior art, passing muster under 35 U.S.C. §§ 102 and 103. See Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66, 89–90 (2012); Synopsys, Inc. v. Mentor Graphics Corp., 839 F.3d 1138, 1151 (Fed. Cir. 2016) (“A claim for a new abstract idea is still an abstract idea). The additional elements (identified in the claim) are generic computer components used to apply the abstract idea.
The alleged advantages such as “addressing network concurrency and security issues. ….. separating storage of the asset from unlock adjudication, and specifically requiring a remote unlock command from the second computing device, the security of the system is improved” are due to improvements in the abstract idea. Therefore, the Applicants’ arguments are not persuasive.
Response to Applicants’ arguments regarding Step 2A – Prong two:
According to MPEP 2106, limitations that are indicative of integration into a practical application include:
Improvements to the functioning of a computer, or to any other technology or technical field - see MPEP 2106.05(a)
Applying or using a judicial exception to effect a particular treatment or prophylaxis for a disease or medical condition
Applying the judicial exception with, or by use of, a particular machine - see MPEP 2106.05(b)
Effecting a transformation or reduction of a particular article to a different state or thing - see MPEP 2106.05(c)
Applying or using the judicial exception in some other meaningful way beyond generally linking the use of the judicial exception to a particular technological environment, such that the claim as a whole is more than a drafting effort designed to monopolize the exception - see MPEP 2106.05(e).
In the instant case, the judicial exception is not integrated into a practical application, because none of the above criteria is met. The additional elements in the claims are two computing devices including processors, memories, network interfaces, an electronic marketplace and an electronic clearinghouse, and user interfaces including one or more controls, and two user terminals to perform all the steps. A plain reading of Figure 1-2 and associated descriptions in at least paragraphs [0039] –[0041], [0055] – [0056], [0180] – [0191] reveals that the computing devices may include suitably programmed general-purpose computers. The processors of these computers may be generic processors suitably programmed to perform the claimed steps. The user interfaces including one or more controls, and the network interfaces are broadly interpreted to include generic computer network components suitably programmed to perform the associated steps. The electronic marketplace and the electronic clearinghouse are a part of the two computing devices. Similarly, the two user terminals user interfaces each including one or more controls are broadly interpreted to include generic computer terminals suitably programmed to perform the associated steps. Hence, the additional elements in the claims are all generic components suitably programmed to perform their respective functions. Accordingly, these additional elements do not integrate the abstract idea into a practical application because it does not impose any meaningful limits on practicing the abstract idea. Hence, the claims are directed to an abstract idea.
The claimed features including those recited on pages 9-10 of the remarks such as “
The first device executes a local locking operation in memory.
The second device monitors an external data feed.
The second device, upon detecting the correct event, transmits a remote execution
command to unlock the locked resource.
The first device receives the command and unlocks, but only in response to the
second device's command” may at best be characterized as an improvement in the abstract idea of a method based on determining the outcome meets the winning parameter, generating and transmitting, by the second network interface, a remote execution command to the first computing device, wherein the remote execution command causes the first computing device to modify the data value in the first memory, so as to transfer the monetary risk amount to a second user account, using the additional elements to apply the abstract idea. An improvement in abstract idea is still abstract (SAP America v. Investpic *2-3 (“We may assume that the techniques claimed are “groundbreaking, innovative, or even brilliant,” but that is not enough for eligibility. Association for Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. 576, 591 (2013).
As discussed earlier the alleged advantages such as “restricting implementation of the alleged abstract idea to a specific two-system networked implementation, with distinct roles given to each of the devices, and for a purpose of increasing data security ….. synchronization and interoperation between the two noted systems” are due to improvements in the abstract idea, using the additional elements as tools in their ordinary capacity. Therefore, the Applicants’ arguments are not persuasive.
Regarding applicant's arguments alleging that the claims do not wholly preempt or monopolize the abstract idea, the Supreme Court in Alice Corp. cautioned that merely limiting the use of an abstract idea “to a particular technological environment” or implementing the abstract idea on a “wholly generic computer” is not sufficient as an additional feature to provide “practical assurance that the process is more than a drafting effort designed to monopolize the [abstract idea] itself.” Alice Corp., 134 Supreme Court. at 2358 (citations omitted). Although the Supreme Court has described “the concern that drives this exclusionary principle [i.e., the exclusion of abstract ideas from patent eligible subject matter] as one of pre-emption,” see Alice Corp.,134 S. Ct. at 2354, characterizing preemption as a driving concern for patent eligibility is not the same as characterizing pre-emption as the sole test for patent eligibility. “The Supreme Court has made clear that the principle of preemption is the basis for the judicial exceptions to patentability” and “[f]or this reason, questions on preemption are inherent in and resolved by the § 101 analysis.” Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir. 2015) (citing Alice Corp., 134 S. Ct. at 2354). “[Preemption may signal patent ineligible subject matter, [but] the absence of complete preemption does not demonstrate patent eligibility.” Id. Also preemption is not a stand-alone test. Preemption concerns have been addressed by the examiner through the application of the 2019 PEG framework. Applicant’s attempt to show alternative uses of the abstract idea outside the scope of the claims does not change the conclusion that the claims are directed to patent ineligible subject matter. Similarly, Applicant’s attempt to show that the recited abstract idea is a very narrow and specific one is not persuasive. A specific abstract idea is still an abstract idea and is not eligible for patent protection without significantly elements more recited in the claim. In the present case, the claimed technology is nothing more than generic computer technology implementing an abstract idea. In Alice also the computer system was specifically programmed to execute the specifically claimed steps in Alice. It is noted that the issue is whether the claims preempt the abstract idea that is claimed. The abstract idea of the challenged claims is not only “a method based on determining the outcome meets the winning parameter, generating and transmitting, by the second network interface, a remote execution command to the first computing device, wherein the remote execution command causes the first computing device to modify the data value in the first memory, so as to transfer the monetary risk amount to a second user account” in general, but also the specific type of “methods based on determining the outcome meets the winning parameter, generating and transmitting, by the second network interface, a remote execution command to the first computing device, wherein the remote execution command causes the first computing device to modify the data value in the first memory, so as to transfer the monetary risk amount to a second user account”. And that the present claims do not preempt the field of a method based on determining the outcome meets the winning parameter, generating and transmitting, by the second network interface, a remote execution command to the first computing device, wherein the remote execution command causes the first computing device to modify the data value in the first memory, so as to transfer the monetary risk amount to a second user account do not make them any less abstract. (See buySAFE, Inc. v. Google, Inc., 765 F.3d 1350, 1355 (Fed. Cir. 2014) (collecting cases); Accenture Global Servs., GmbH v. Guidewire Software, Inc., 728 F.3d 1336, 1345 (Fed. Cir. 2013) (generating tasks in an insurance organization). Also, Ultramercial decision makes it clear that Patent Owner's arguments regarding pre-emption "are not a substitute for the proper two-part test under Alice".
The additional elements (identified in the rejection) are suitably programmed generic computer components used as tools in their ordinary capacity to apply the abstract idea. It does not involve any improvements to another technology, technical field, or improvements to the functioning of the computer itself. Therefore, the Applicants’ arguments are not persuasive.
For all these reasons and those discussed in the rejections above, the rejection under 35 USC 101 is maintained by the Examiner.
Conclusion
7. The prior art made of record and not relied upon is considered pertinent to applicant's disclosure:
(a) Mittal; Hitesh et al. (US Pub. 2012/0089503 A1) discloses systems and methods for maintaining neutrality while trading a list of securities using an algorithmic trading facility coupled with at least one destination. This destination includes at least one alternative trading system (ATS). This facility is coupled, via an electronic data network, to a plurality of trading clients, and configured to receive a trade request to trade a list of securities from a trading client. This request includes user defined trading constraints that are used to generate and transmit trade orders to at least one ATS. The orders are transmitted based on trading data related to the destinations, the trade list, and the trading constraints. The facility can identify each executed trade corresponding to the trade orders and calculate a trade imbalance. The facility can determine whether the trade imbalance exceeds the trading constraints, and reallocate one or more of said submitted orders based on this determination.
(b) Venkatesan; Mageshkumar et al. (US Pub. 2013/0024349 A1) discloses a trading system with very high percent success rate in market by means of minimizing the risk. This invention provides an easy and simple-to-use system for swing trading. This system is automated and based on an algorithm which uses the end of the day data for particular financial instrument to generate buy/sell signals for selected stocks. These signals provide the precise entry and exit points in the markets for those particular stocks. The signals come with a small stop loss to ensure safety of the investment. The system provides three exit levels to ensure that the investment risk is minimized and profit is reaped.
8. Applicant's amendment necessitated the new ground(s) of rejection presented in this Office action. 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 Narayanswamy Subramanian whose telephone number is (571) 272-6751. The examiner can normally be reached Monday-Friday from 9:00 AM to 5:00 PM. If attempts to reach the examiner by telephone are unsuccessful, the examiner's supervisor, Abhishek Vyas can be reached at (571) 270-1836. The fax number for Formal or Official faxes and Draft to the Patent Office is (571) 273-8300.
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/Narayanswamy Subramanian/
Primary Examiner
Art Unit 3691
February 23, 2026