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 the Claims
Claims 1, 9, and 11 are amended. Claim 4 has been canceled. Claims 1-3 and 5-20 are pending.
Information Disclosure Statement
The information disclosure statement (IDS) submitted on 02/06/2024 was filed before the mailing of this action. The submission is in compliance with the provisions of 37 CFR 1.97. Accordingly, the information disclosure statement is being considered by the examiner.
Response to Arguments
Applicant’s arguments, see pg. 9, filed 11/24/2025, with respect to the claim objection have been fully considered and are persuasive. The claim objection of claim 9 has been withdrawn.
Applicant's arguments filed 11/24/2025 regarding 35 U.S.C. 101 have been fully considered but they are not persuasive.
Applicant argues that the claims are directed to patentable subject matter under Step 2A Prong One. Examiner disagrees. The Federal Circuit has explained that "the 'directed to' inquiry applies a stage-one filter to claims, considered in light of the specification, based on whether 'their character as a whole is directed to excluded subject matter."' Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1335 (Fed. Cir. 2016) (quoting Internet Patents Corp. v. Active Network, Inc., 790 F.3d 1343, 1346 (Fed. Cir. 2015)). It asks whether the focus of the claims is on a specific improvement in relevant technology or on a process that itself qualifies as an "abstract idea" for which computers are invoked merely as a tool. See id. at 1335-36. Here, it is clear from the Specification (including the claim language) that claims focus on an abstract idea, and not on an improvement to technology and/or a technical field. The specification recites in the Background that [0002] “The financial industry operates within a strict regulatory framework to protect investors and maintain stability. However, regulatory compliance processes using conventional tools can be cumbersome, error prone, and lack desired transparency. As authorities generate new financial regulations and/or update existing financial regulations, the conventional tools must be manually updated. Further, it is a challenge to provide proof of regulatory compliance to authorities in a manner that maintains account holders’ privacy.” [0003] “Distributed ledgers provide several advantages to centralized data storage, such as transparency, immutability, and redundancy, that make them attractive to the financial industry. But a distributed ledger’s transparency may cause privacy issues, as financial transactions must be broadcast to the distributed ledger network for computation and validation.” Applicant discloses in [0007] “The disclosed systems and methods improve computer security and data privacy by providing cryptographic regulatory compliance information to organizations without revealing private account or transaction data. That is, privacy and security may be improved by using the disclosed systems and methods to cryptographically store and transmit regulatory compliance information instead of traditionally providing private data to regulatory organizations. Moreover, the use of fully homomorphic encryption to securely store and process encrypted data in the distributed ledger further improves computer security.” The invention and claims are drawn towards automating the determination of regulatory compliance, and claim 1 recites limitations that directly correspond to certain methods of organizing human activity (commercial or legal interactions, business relations, managing personal interactions or relationships, following rules or instructions), as evidenced by limitations detailing receiving and determining compliance information for a financial account, generating a smart contract from regulatory ruleset(s), and transmitting the smart contract to other participants. The claim also recites limitations the directly correspond to mental processes (observation, evaluation, judgment, opinion), as evidenced by limitations detailing the evaluation and observation of financial data to determine compliance (judgment/opinion), and generating contracts based on regulatory rulesets that determine compliance, etc. The claims recite an abstract idea. Applicant argues that the claim limitations cannot be amental process because a human cannot physically or mentally append encrypted data to a distributed ledger and modify a smart contract based on the appended data. This argument is not persuasive. The relevant question is whether the claimed limitations reflect concepts that correspond to act such as the observation of data, evaluation of data or conditions, making determinations (judgment/opinion) based on the observed and evaluated data, and in this case, making updates based on the determinations or observed and evaluated data. The applicant’s recited limitations directly correspond to decision-making processes, and implementing these concepts using distributed ledger technology or automation by use of a computer does not take the claims out of the judicial exception grouping. Claims can recite a mental process even if they are claimed as being performed on a computer. If the claimed invention is described as a concept that is performed in the human mind and applicant is merely claiming that concept performed 1) on a generic computer, or 2) in a computer environment, or 3) is merely using a computer as a tool to perform the concept, the claim is considered to recite a mental process. Applicant also argues that, based on Synopsys, Inc. v. Mentor Graphics Corp., 839 F.3d 1138, 1148 (Fed. Cir. 2016) that the Federal Circuit recognizes that encryption methods requiring specific computational steps are not mental processes. Applicant’s interpretation of the findings in this case is erroneous. The claims were for a specific data encryption method for computer communication and the Court denied subject matter eligibility for the method that translates a functional description of a logic circuit into a hardware component. The Court found that the claims effectively constituted mental steps and as such, the claims were directed to an abstract idea.
Applicant argues that the claims are directed to patent eligible subject matter under Step 2A Prong Two, specifically that the claims recite meaningful limitations such as meaningfully limiting the practice of automating the determination of regulatory compliance with smart contracts by preventing unauthorized access, enhancing security, and maintaining transparency in verifying regulatory compliance information to organizations by "append[ing] the regulatory compliance information to a distributed ledger maintained by a network of participants as a block on a blockchain-based protocol" without revealing private account or transaction data. Applicant merely recites elements that are the focus of the abstract idea. The judicial exception is not integrated into a practical application simply because the claims recite the additional elements of: one or more processors, a smart contract, a distributed ledger, distributed ledger network, and a private and public cryptographic key. The additional elements are computer components recited at a high-level of generality performing the above-mentioned limitations. The combination of the additional elements are no more than mere instructions to apply the judicial exception using a generic computer. Further, the smart contract and cryptographic keys amount to generally linking the judicial exception to a particular field of use. Accordingly, in combination, these additional elements do not integrate the abstract idea into a practical application because they do not impose any meaningful limits on practicing the abstract idea. The claims are directed to an abstract idea.
Applicant argues that the claims amount to significantly more under Step 2B. Examiner disagrees. The claims do 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 amount to no more than mere instructions to apply the exception using a generic computer and generally linking the judicial exception to a particular field of use. Mere instructions to apply an exception using a generic computer cannot provide an inventive concept. Thus, when viewed as an ordered combination, nothing in the claims add significantly more (i.e. an inventive concept) to the abstract idea. The claims are not patent eligible.
Applicant’s arguments, see pg. 16, filed 11/24/2025, with respect to 35 U.S.C. 103 have been fully considered and are persuasive. The 35 U.S.C. 103 rejection of has been withdrawn.
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 1-3 and 5-20 are rejected under 35 U.S.C. 101 because the claimed invention is directed to a judicial exception (i.e. an abstract idea) without significantly more.
Claims 1-3 and 5-20 recite a method (i.e. process). Therefore claims 1-3 and 3-20 fall within one of the four statutory categories of invention.
Independent claim 1 recites the limitations: generating a [smart contract] from a regulatory ruleset, wherein the regulatory ruleset comprises programmatic logic for determining regulatory compliance, wherein the [smart contract] is configured to: receive the financial data associated with the financial account, determine from the financial data whether the financial account is compliant, responsive to determining that the financial account is compliant, generate regulatory compliance information, wherein the regulatory compliance information comprises: 1) cryptographic proof of regulatory compliance and 2) information encrypted by a private cryptographic key associated with the financial account; and append the regulatory compliance information to a distributed ledger maintained by a network of participants as a block on a blockchain-based protocol; transmitting the [smart contract] to at least one other participant in a [distributed ledger network] to deploy the [smart contract], wherein the [smart contract] is stored in the [distributed ledger] maintained by the network of participants; receiving a request from an organization outside the distributed ledger network regarding the regulatory compliance of the financial account; modifying the smart contract based on the regulatory compliance information appended to the distributed ledger; and providing to the organization, 1) the regulatory compliance information without revealing the financial data, and (2) a public cryptographic key associated with the financial account. The invention and claims are drawn towards automating the determination of regulatory compliance, and claim 1 recites limitations that directly correspond to certain methods of organizing human activity (commercial or legal interactions, business relations, managing personal interactions or relationships, following rules or instructions), as evidenced by limitations detailing receiving and determining compliance information for a financial account, generating a smart contract from regulatory ruleset(s), and transmitting the smart contract to other participants. The claim also recites limitations the directly correspond to mental processes (observation, evaluation, judgment, opinion), as evidenced by limitations detailing the evaluation and observation of financial data to determine compliance (judgment/opinion), and generating contracts based on regulatory rulesets that determine compliance, etc. The claims recite an abstract idea.
Note: The features or limitations in brackets in the above section are inserted for reading clarity, but are analyzed as “additional elements” under Step 2A Prong Two and Step 2B below.
The judicial exception is not integrated into a practical application simply because the claims recite the additional elements of: one or more processors, a smart contract, a distributed ledger, distributed ledger network, and a private and public cryptographic key. The additional elements are computer components recited at a high-level of generality performing the above-mentioned limitations. The combination of the additional elements are no more than mere instructions to apply the judicial exception using a generic computer. Further, the smart contract and cryptographic keys amount to generally linking the judicial exception to a particular field of use. Accordingly, in combination, these additional elements do not integrate the abstract idea into a practical application because they do not impose any meaningful limits on practicing the abstract idea. The claims are directed to an abstract idea.
The claims do 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 amount to no more than mere instructions to apply the exception using a generic computer and generally linking the judicial exception to a particular field of use. Mere instructions to apply an exception using a generic computer cannot provide an inventive concept. Thus, when viewed as an ordered combination, nothing in the claims add significantly more (i.e. an inventive concept) to the abstract idea. The claims are not patent eligible.
Independent claim 11 recites the limitations: generating a [transactional smart contract] from a transactional ruleset, wherein the transactional ruleset comprises programmatic logic for executing the financial transaction, wherein the transactional smart contract is configured to: receive one or more transaction inputs associated with the financial transaction, execute the financial transaction using the one or more transaction inputs, and generate one or more transaction outputs; generating a [regulatory smart contract] from a regulatory ruleset, wherein the regulatory ruleset comprises programmatic logic for determining regulatory compliance, wherein the regulatory smart contract is configured to: receive the one or more transaction inputs and the one or more transaction outputs, determine from the one or more transaction inputs and the one or more transaction outputs whether the financial transaction is compliant, and responsive to determining that the financial transaction is compliant, generate regulatory compliance information, wherein the regulatory compliance information comprises cryptographic proof of regulatory compliance; append the regulatory compliance information to a distributed ledger maintained by a network of participants as a block on a blockchain-based protocol; transmitting the [transactional smart contract] and the regulatory smart contract to at least one other participant in a [distributed ledger network] to deploy the [transactional smart contract] and the [regulatory smart contract], wherein the [transactional smart contract] and the [regulatory smart contract] are stored in the [distributed ledger] maintained by the network of participants; sending the one or more transaction inputs to the [transactional smart contract]; receiving a request from an organization regarding the regulatory compliance of the financial transaction; sending the one or more transaction inputs and the one or more transaction outputs to the [regulatory smart contract]; and providing to the organization, the regulatory compliance information without revealing the one or more transaction inputs or the one or more transaction outputs. The invention and claims are drawn towards automating the determination of regulatory compliance, and claim 1 recites limitations that directly correspond to certain methods of organizing human activity (commercial or legal interactions, business relations, managing personal interactions or relationships, following rules or instructions), as evidenced by limitations detailing receiving and determining compliance information for a financial account, generating a smart contract from regulatory ruleset(s), and transmitting the smart contract to other participants. The claim also recites limitations the directly correspond to mental processes (observation, evaluation, judgment, opinion), as evidenced by limitations detailing the evaluation and observation of financial data to determine compliance (judgment/opinion), and generating contracts based on regulatory rulesets that determine compliance, etc. The claims recite an abstract idea.
Note: The features or limitations in brackets in the above section are inserted for reading clarity, but are analyzed as “additional elements” under Step 2A Prong Two and Step 2B below.
The judicial exception is not integrated into a practical application simply because the claims recite the additional elements of: one or more processors, a transactional and regulatory smart contract, a distributed ledger and distributed ledger network. The additional elements are computer components recited at a high-level of generality performing the above-mentioned limitations. The combination of the additional elements are no more than mere instructions to apply the judicial exception using a generic computer. Further, the smart contract amounts to generally linking the judicial exception to a particular field of use. Accordingly, in combination, these additional elements do not integrate the abstract idea into a practical application because they do not impose any meaningful limits on practicing the abstract idea. The claims are directed to an abstract idea.
The claims do 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 amount to no more than mere instructions to apply the exception using a generic computer and generally linking the judicial exception to a particular field of use. Mere instructions to apply an exception using a generic computer cannot provide an inventive concept. Thus, when viewed as an ordered combination, nothing in the claims add significantly more (i.e. an inventive concept) to the abstract idea. The claims are not patent eligible.
Dependent claims 2 and 12 recite the limitation that the regulatory compliance information comprises a [non-fungible token (NFT)]. The limitation is further directed to the abstract idea analyzed above. The claims also recite the additional element of a non-fungible token (NFT). The additional elements amount to generally linking the judicial exception to a particular field of use. Accordingly, in combination, the 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. Further, when viewed as an ordered combination, nothing in the claims add significantly more (i.e. an inventive concept) to the abstract idea. The claims are not patent eligible.
Dependent claims 5 and 15 recite the limitations of storing the regulatory compliance information in a [digital wallet] associated with the financial account (a party associated with the financial institution, claim 15). The claims are further directed to the abstract idea analyzed above. The claims also recite the additional elements of the one or more processors and the digital wallet. The one or more processors amount to “apply it” or merely using a computer as a tool to implement the judicial exception. The digital wallet amounts to generally linking the judicial exception to a particular field of use. Accordingly, in combination, these additional elements do not integrate the abstract idea into a practical application because they do not impose any meaningful limits on practicing the abstract idea. Further, when viewed as an ordered combination, nothing in the claims add significantly more (i.e. an inventive concept) to the abstract idea. The claims are not patent eligible.
Dependent claims 6 and 16 recite the limitations that providing the regulatory compliance information comprises supplying, by the one or more processors to the organization, the regulatory compliance information via a [zero-knowledge proof (ZKP)]. The limitations are further directed to the abstract idea analyzed above. The claim also recites the additional element of a zero-knowledge proof (ZKP). The additional element amounts to generally linking the judicial exception to a particular field of use. Accordingly, in combination, the 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. Further, when viewed as an ordered combination, nothing in the claims add significantly more (i.e. an inventive concept) to the abstract idea. The claims are not patent eligible.
Dependent claims 7 and 17 recite the limitations: retrieving, from an authoritative source, one or more regulations comprising unstructured financial rule text promulgated by a regulatory authority; and generating, by a [natural language processing (NLP) service] the regulatory ruleset from the one or more regulations. The limitations are further directed to the abstract idea analyzed above. The claim also recites the additional elements of a natural language processing (NLP) service running on the one or more processors. The additional elements amount to “apply it" or merely using a computer as a tool to implement the judicial exception. Further, the NLP amounts to generally linking the judicial exception to a particular field of use. Accordingly, in combination, the additional elements do not integrate the abstract idea into a practical application because they do not impose any meaningful limits on practicing the abstract idea. Further, when viewed as an ordered combination, nothing in the claims add significantly more (i.e. an inventive concept) to the abstract idea. The claims are not patent eligible.
Dependent claims 14 recite the limitations that the regulatory compliance information comprises information encrypted by a [private cryptographic key] associated with the financial account (a party associated with the financial transaction), and wherein providing the regulatory compliance information further comprises providing to the organization, a [public cryptographic key] associated with the financial account. The limitations are further directed to the abstract idea analyzed above. The claim also recites the additional element of a private cryptographic key, public cryptographic key, and the one or more processors. The additional elements of the private cryptographic key and public cryptographic key amounts to generally linking the judicial exception to a particular field of use. The one or more processors amount to “apply it” or merely using a computer as a tool to implement the judicial exception. Accordingly, in combination, these additional elements do not integrate the abstract idea into a practical application because they do not impose any meaningful limits on practicing the abstract idea. Further, when viewed as an ordered combination, nothing in the claim adds significantly more (i.e. an inventive concept) to the abstract idea. The claim is not patent eligible.
Dependent claims 3, 8-10, 13, and 18-20 recite additional limitations that are further directed to the abstract idea analyzed in the rejected claims above. The claims also recite additional elements that have been analyzed in the rejected claims above. Thus, claims 3, 8-10, 13, and 18-20 are also rejected under 35 U.S.C. 101.
Allowable Subject Matter
Claims 1-3 and 5-20 would be allowable if rewritten or amended to overcome the rejection(s) under 35 U.S.C. 101, set forth in this Office action.
The closest patent or patent application prior art reference found that is relevant to the applicant’s claims include Doney (2023/0342849) which discloses a system that helps to facilitate scalable compliance and issuer governance of decentralized financial transactions especially for the trade and transfer of tokenized securities. While Doney discloses generating a smart contract from a regulatory rules set, Doney fails to disclose the amended limitations of the applicant’s claims. The claims overcome the prior art.
The closest non-patent literature prior art reference found that is relevant to the applicant’s invention includes the publication “Concept of a Regulatory Compliant Blockchain Based Instant Payment System. Limitations and Compromises” (Zilmieks, 2020). The publication discloses a concept of a system based on peer-to-peer networking mechanisms like blockchain and smart contracts, and integration of regulatory services in order to be legal and compliant. The publication however does not explicitly disclose generating a smart contract from a regulatory rules set, and fails to disclose the amended limitations of the applicant’s claims. The claims overcome the prior art.
Conclusion
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 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 DIONE N SIMPSON whose telephone number is (571)272-5513. The examiner can normally be reached M-F; 7:30 a.m.-4:30 p.m..
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DIONE N. SIMPSON
Primary Examiner
Art Unit 3628
/DIONE N. SIMPSON/Primary Examiner, Art Unit 3628