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 .
DETAILED ACTION
2. This Final Office action is in response to the application filed on March 15th, 2024, and in response to Applicant’s Arguments/Remarks field on April 6th, 2026. Claims 1 and 3-20 are pending.
Examiner Note
3. Michael Young is no longer continuing prosecution on application number 18/607,385. It has been transferred to Examiner Jessica Lemieux.
Priority
4. Application 18/607,385 was filed on March 15th, 2024, which is a continuation of 18/125,439 filed on March 23rd, 2023, which has a provisional application 63/435,473 filed on December 27th, 2022.
Examiner Request
5. The Applicant is requested to indicate where in the specification there is support for amendments to claims should Applicant amend. The purpose of this is to reduce potential 35 U.S.C. §112(a) or §112 1st paragraph issues that can arise when claims are amended without support in the specification. The Examiner thanks the Applicant in advance.
Information Disclosure Statement
6. The information disclosure statement (IDS) submitted on 4/29/2026 and 8/19/2026 was filed in compliance with the provisions of 37 CFR 1.97. Accordingly, the information disclosure statement is being considered by the examiner.
Response to Arguments
7. Applicant’s arguments, with respect to the nonstatutory double patenting rejection of claims 1 and 3-20 have been fully considered and are persuasive. The nonstatutory double patenting rejection of claims 1 and 3-20 has been withdrawn.
8. Applicant’s arguments, with respect to the 35 USC § 103 rejection of claims 1 and 3-20 have been fully considered and are persuasive in view of the amended claim language. The 35 USC § 103 rejection of claims 1 and 3-20 has been withdrawn.
9. Applicant’s arguments regarding the rejection of claims 1 and 3–20 under 35 U.S.C. § 101 have been fully considered but are not persuasive. Step 2A, Prong One Applicant argues that the claims do not recite a certain method of organizing human activity because “there are no steps that are directed at the management of people or their behavior.” This argument is not persuasive. The rejection is not based solely on managing personal behavior. Rather, claims 1, 9, and 17 recite commercial and financial activities associated with residential net lease management, including determining profitability and lease parameters, identifying properties satisfying those parameters, determining fixed and variable costs, generating net lease terms, accounting for investor funding and remuneration, managing a reserve fund, and sending an instruction to trigger a transfer to the reserve fund. These limitations concern commercial and financial interactions and practices associated with leasing, property investment, profitability evaluation, accounting, and management and transfer of funds. Accordingly, they fall within the “certain methods of organizing human activity” grouping of abstract ideas. The claims also recite mathematical calculations and relationships, including determining a threshold margin based on a percentage of an average rental rate and average fixed costs, generating or using weights, applying weighted parameters of current market data, and updating the machine-learning model based on a weighted percentage of an adjusted rental rate. Thus, Applicant’s argument that the claims do not manage people or their behavior does not overcome the identification of the judicial exceptions recited by the claims.
10. Applicant next argues that the claims integrate the judicial exception into a practical application because the claimed framework allegedly improves digital management and digital accounting by continuously updating market data and using a machine-learning model to generate current net lease terms and profitability evaluations. This argument is not persuasive. The asserted improvement concerns the accuracy or currency of profitability evaluations, net lease terms, and rental-rate recommendations. These are improvements to the commercial or financial information produced by the claimed process, rather than improvements to computer functionality, machine-learning technology, database technology, network operation, or another technological field. Although Applicant relies on portions of the Specification describing continuously updated market information and use of such information by the machine-learning model, the claims do not recite a new machine-learning architecture, training technique, computer-processing mechanism, or another improvement to the operation of the underlying technology. Rather, the machine-learning model is used as a tool to process financial, rental, market, and cost information to generate lease terms, weights, and a recommended rental-rate adjustment. The newly recited limitation concerning a weighted percentage of the adjusted rental rate merely identifies the financial information used to update the model and it does not recite an improvement to machine-learning technology itself. Accordingly, the asserted improvement is an improvement to the performance of the underlying commercial and financial activity and does not integrate the identified abstract idea into a practical application.
11. Applicant argues that the claims effect a transformation by retrieving raw market data and using the machine-learning model to convert that data into a profitability evaluation and current net lease terms. This argument is not persuasive. The claimed process analyzes and converts information into other information. Market and financial data are used to generate profitability evaluations, lease terms, weights, and rental-rate recommendations. Such processing does not transform a particular article into a different state or thing. Likewise, sending an instruction to trigger a transfer to the single reserve fund carries out the claimed financial activity and does not constitute a technological transformation. Accordingly, the claims do not integrate the judicial exception into a practical application under the transformation consideration.
12. Applicant further argues that the claims are integrated into a practical application because they rely upon third-party applications, an expense network, a net lease management server, various software modules, a machine-learning model, databases, and a single reserve fund. This argument is not persuasive. As claimed, the additional computer-related elements function to receive, process, analyze, store, and communicate the financial and lease-related information used to carry out the identified abstract idea. Assigning different portions of the claimed commercial and financial process to different software modules does not establish that the judicial exception is meaningfully limited by a particular machine. The recited server, networks, modules, databases, processor or computing system, and machine-learning model provide the technological tools and environment through which the identified abstract idea is performed. The claims do not recite a specialized technological implementation that alters the functioning of those components. Moreover, the single reserve fund and the claimed accounting for investor funding and remuneration are themselves part of the underlying commercial and financial activity rather than technological elements that meaningfully limit the judicial exception. Accordingly, the claimed components do not establish integration into a practical application under the particular machine consideration.
13. Applicant further argues that the Office Action failed to adequately establish that the additional elements are well-understood, routine, and conventional under MPEP § 2106.07(a)(III), and contends that the claimed elements therefore amount to an inventive concept. Applicant’s conclusion is not persuasive. Examiner notes that where the Office determines at Step 2B that an additional element or combination of elements is well-understood, routine, and conventional, that determination must be expressly supported per MPEP 2106.07(a)(III). However, the absence of such a determination or supporting evidence does not establish that the claimed elements are unconventional, or that they provide an inventive concept. Further, several limitations relied upon by Applicant, including determining profitability, generating lease terms and rental-rate recommendations, accounting for investor funding and remuneration, and managing the single reserve fund, form part of the identified commercial and financial abstract idea and therefore do not themselves constitute additional elements capable of supplying the inventive concept. As discussed in the rejection below, the remaining computer-related additional elements merely implement the identified abstract idea using computer technology and, considered separately and as an ordered combination, do not provide an inventive concept sufficient to transform the abstract idea into patent-eligible subject matter. Therefore, the 35 USC § 101 rejection of claims 1 and 3-20 is maintained.
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.
14. Claims 1 and 3-20 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.
Claims 1 and 3-20 are directed to a method, system, and non-transitory computer-readable medium. Thus, each of the claims falls within one of the four statutory categories (Step 1: YES).
Claims 1, 9, and 17 are all directed to substantially similar subject matter and will be addressed collectively below
Under Step 2A, Prong One, the inquiry is whether the claims recite a judicial exception. Examiner notes that claim 1, 9, and 17, recite abstract ideas falling within the groupings of certain methods of organizing human activity and mathematical concepts.
The claims recite commercial and financial activities associated with residential net lease management, including receiving market information concerning a geographic region, determining profitability and lease parameters, identifying properties satisfying the lease parameters, determining fixed and variable costs associated with the properties, generating current net lease terms, accounting for investor funding and remuneration, managing a reserve fund, and sending an instruction to trigger a transfer to the reserve fund. These limitations concern commercial and financial interactions and practices associated with leasing, property investment, profitability evaluation, accounting, and management and transfer of funds. Accordingly, these limitations fall within the “certain methods of organizing human activity” grouping of abstract ideas.
The claims additionally recite calculations and mathematical relationships used to perform the financial analysis, including determining a threshold margin based on a percentage of an average rental rate and average fixed costs, generating or using weights, applying weighted parameters of current market data, and updating the machine-learning model based on a weighted percentage of an adjusted rental rate. These limitations encompass mathematical calculations and relationships and therefore additionally fall with the mathematical concepts grouping of abstract ideas.
The claimed use of a machine-learning model does not alter this determination. The machine-learning model receives financial, rental, market, and cost information and is used to generate net lease terms, weights, and a recommended rental-rate adjustment. Thus, the model is used as a tool to perform the claimed commercial and financial analysis.
The limitations falling within the identified abstract-idea groupings are considered together for purposes of the eligibility analysis. Accordingly, claims 1, 9, and 17 recite judicial exceptions under Step 2A, Prong One. (Step 2A- Prong 1: YES. The claims recite an abstract idea).
If the claims are directed toward the judicial exception of an abstract idea, it must then be determined under Step 2A Prong 2 whether the claims as a whole integrate the judicial exception into a practical application. The additional elements include the expense network, communication network, net lease management server, third-party application, reserve module, owner module, manage module, net lease module, accounting module, machine-learning model, lease database, reserve database, storage, processor or computing system, and related computer implementation. These additional elements are considered individually and in combination. As claimed, the additional elements function to receive, process, analyze, store, and communicate the financial and lease-related information used to carry out the identified abstract idea, such that they amount no more than mere instructions to apply the exception using generic computer components. The asserted advance concerns more current or accurate profitability evaluations, net lease terms, and rental-rate recommendations resulting from use of current market information and machine learning. These are improvements to the commercial or financial information produced by the claimed process, rather than improvements to computer functionality, machine-learning technology, database technology, network operation, or another technological field. Accordingly, these additional elements, when considered individually and in combination, do not integrate the abstract idea into a practical application because they do not impose any meaningful limits on practicing the abstract idea. Therefore, claims 1, 9, and 17 are directed to an abstract idea without a practical application. (Step 2A-Prong 2: NO: the additional claimed elements are not integrated into a practical application).
Because claims 1, 9, and 17 recite a judicial exception and do not integrate the exception into a practical application, the analysis proceeds to Step 2B to determine whether the claims recite additional elements, individually or as an ordered combination, that amount to significantly more than the judicial exception. The claimed commercial and financial limitations, including determining profitability, generating lease terms and rental-rate recommendations, accounting for investor funding and remuneration, and managing the single reserve fund, form part of the identified abstract idea and therefore do not themselves constitute additional elements capable of supplying the inventive concept. The remaining computer-related additional elements are described in Applicant’s Specification at a high level of generality, and the Specification does not require specialized computer hardware or specialized machine-learning architecture for performance of the claimed functions. See, e.g., Specification paragraphs [0088]-[0094]. Thus, the additional computer elements amount to instructions to implement the identified abstract idea using computer technology. Considered separately and as an ordered combination, the additional elements do not alter the functioning of the computer components or machine-learning technology and do not provide an inventive concept sufficient to transform the abstract idea into patent eligible subject matter. Thus claims 1, 9, and 17 are not patent eligible. (Step 2B: NO. The claims do not provide significantly more).
Dependent claims 3-8, 10-16, and 18-20 are similarly rejected because they merely further narrow the same abstract idea of independent claims 1, 9, and 17 and/or do not further limit the claims so as to integrate the judicial exception into a practical application or provide an inventive concept such that the claims are subject matter eligible even when considered individually or as an ordered combination.
Claims 3-8, 10-16, and 18-20 are directed to further embellishments of the abstract idea in that they are directed to aspects of residential lease management, property investment, accounting, contractual activity, and processing of related financial and lease information.
Therefore, the dependent claims do not recite additional limitations that integrate the judicial exception into a practical application or that, individually or in combination, amount to significantly more than the judicial exception. Accordingly claims 3-8, 10-16, and 18-20 are also rejected under 35 U.S.C. § 101 as being directed to non-statutory subject matter. See MPEP 2106.
Conclusion
15. THIS ACTION IS MADE FINAL. 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 JESSICA LEMIEUX whose telephone number is (571)270-3445. The examiner can normally be reached Monday-Friday 7AM-3PM.
Examiner interviews are available via telephone, in-person, and video conferencing using a USPTO supplied web-based collaboration tool. To schedule an interview, applicant is encouraged to use the USPTO Automated Interview Request (AIR) at http://www.uspto.gov/interviewpractice.
If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, TARIQ HAFIZ can be reached at (571) 272-5350. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300.
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/JESSICA LEMIEUX/Supervisory Patent Examiner, Art Unit 3626
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