DETAILED ACTION
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 .
The following is a Final Office Action in response to communications received June 05, 2024. No Claim(s) have been canceled. No Claims have been amended. No new claims have been added. Therefore, claims 1-20 are pending and addressed below.
Priority
Application No. 18/734,850 Filing date or 371(c) date: 06/05/2024
Assignee/Applicant Name: Wells Fargo Bank, N.A.
Inventor(s): Aravala, Srinivasa Rao; Mishra, Raman K.
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 1-20 are rejected under 35 U.S.C. § 101 because the instant application is directed to non-patentable subject matter. Specifically, the claims are directed toward at least one judicial exception without reciting additional elements that amount to significantly more than the judicial exception. The rationale for this determination is in accordance with the guidelines of USPTO, applies to all statutory categories, and is explained in detail below.
In reference to Claim(s) 1-10:
STEP 1. Per Step 1 of the two-step analysis, the claims are determined to include a method, as in independent Claim 1 and the dependent claims. Such methods fall under the statutory category of "process." Therefore, the claims are directed to a statutory eligibility category.
STEP 2A Prong 1. The claimed invention is directed to an abstract idea without significantly more. Method claim 1 recites method steps (1) identifying plurality of bonds sharing similar attributes (2) identifying plurality of volatility for one or more of the plurality of bonds (3) creating a filtered group of nearest neighbor bonds (4) calculating correlation coefficient between pairs of the plurality of bonds within the filtered group (5) sorting filtered group of …bonds…(6) selecting predetermined number of bonds from the filtered group to form index group (7) computing a weighted average index price for the index group (8) determining a variance for predetermined number of bonds within the index group.
The claimed limitations which under its broadest reasonable interpretation, covers performance of the limitation in the mind. The claim limitations lack any technical disclosure and can reasonably performed using mental processes.
The steps recite steps that can easily be performed in the human mind as mental processes because the steps of “identifying…bonds”, “identifying…volatility”, “creating …filtered group…bonds”, “calculating correlation coefficient…”, “”sorting …filtered group”, “selecting…number of bonds”, “computing weighted average index price”, “determining a variance for …bonds within …group”. Therefore, the limitations, mimic human thought processes of observation, evaluation and decision, , where the data interpretation is perceptible only in the human mind. See In re TLl Commc'ns LLC Patent Litig., 823 F.3d 607, 611 (Fed. Cir. 2016); FairWarning IP, LLC v. latric Sys., Inc., 839 F.3d 1089, 1093-94 (Fed. Cir. 2016)
Furthermore, when considered as a whole the claimed subject matter is directed toward receiving, analyzing analysis of financial data in order to determine number of bonds within a selected group in order to determine variance for predetermined bonds within a group in relation to a …average price. Such concepts can be found in the abstract category of commercial interactions and marketing. These concepts are enumerated in Section I of the 2019 revised patent subject matter eligibility guidance published in the federal register (84 FR 50) on January 7, 2019) is directed toward abstract category of mental processes and methods of organizing human activity.
STEP 2A Prong 2: The identified judicial exception is not integrated into a practical application because the claims fail to provide indications of patent eligible subject matter that integrate the alleged abstract idea into a practical application. The claim limitations lack any additional elements recited in the claim beyond the abstract idea.
The limitations 1-3 when considered as a combination are directed toward creating a filtered group of nearest neighbor bonds of the identified bonds sharing similar attributes excluding identified volatilities exceeding threshold which is directed toward a commercial activity. The combination of limitations 4-6 with respect to the created filtered group of limitations 1-3 is directed toward calculating correlating coefficient between pairs, sorting filtered group, selecting a predetermined number of bonds in order to form an index group a commercial activity. The combination of limitations 1-6 and 7-8 is directed toward computing a weighted average prices of the group of limitations 1-6 in order to determine a variance for predetermined bonds within the group selected in relation with the computed price – a commercial activity. Accordingly, the limitations individually or as a combination are not directed toward any limitations related to technology for improvement, to provide a solution to a problem rooted in technology, apply the judicial exception with or by use of a particular machine, or apply the judicial exception in a manner that imposes meaningful limits upon a technical environment. Accordingly, none of the claim limitations when considered individually or as a combination of parts or individually are directed toward any indications of patent eligibility under step 2a prong 2.
The combinations of parts is not directed toward any of the indications of patent eligible subject matter under step 2A prong 2, but instead a process to determine index price of bonds selected according criteria. MPEP guidance (see MPEP 2106.05 (a)-(c), (e )-(h). The claim limitations as a whole, as an ordered combination and the combination of steps not integrate the judicial exception into a practical application as the claim process fails to impose meaningful limits upon the abstract idea. . This is because the claimed subject matter fails to provide additional elements or combination or elements that go beyond applying technology as a tool to perform the identified abstract idea. The functions recited by the mobile device in the claims recite the concept of a financial activity. The claim limitations and specification lacks technical disclosure on what the technical problem was and how the claimed limitations provide a technical solution to a technical problem rather than a solution to a problem found in the abstract idea. Taking the claim elements separately, or as a combination, the limitations at each step of the process is purely in terms of results desired and devoid of any technology. Technology is not integral to the process as the claimed subject matter. The claimed functions do not provide an operation that could be considered as sufficient to provide a technological implementation or application of/or improvement to this concept (i.e. integrated into a practical application).
The limitations lack any elements directed toward technology and do not improve upon technology or improve upon computer functionality or capability in how computers carry out one of their basic functions. The claimed elements do not provide a process that allows computers to perform functions that previously could not be performed. The claimed limitations do not provide a process which applies a relationship to apply a new way of using technology an application. The limitations do not recite a specific use machine or the transformation of an article to a different state or thing. The limitations do not provide other meaningful limits beyond generally linking the use of the abstract idea to a particular technological environment. The instant application, are still a combination made to perform a financial activity and does not provide any of the determined indications of patent eligibility set forth in the 2019 USPTO 101 guidance.
STEP 2B; The claim(s) does/do not include additional elements that are sufficient to amount to significantly more than the judicial exception because as discussed above with respect to concepts of the abstract idea into a practical application. Lacking any technology or technical process the claimed subject matter fails 2B as the limitations do not provide significantly more than the identified abstract idea or provide an unconventional technical process.
The remaining dependent claims—which impose additional limitations—also fail to claim patent-eligible subject matter because the limitations cannot be considered statutory. In reference to claims 2-10 these dependent claim have also been reviewed with the same analysis as independent claim 1. Dependent claim 2 is directed toward evaluating attributes of claim 1 including financial related attributes- commercial activity. Dependent claim 3 is directed toward establishing a sensitivity for k-nearest neighbor algorithm which is directed toward amounting to no more than mere instructions to calculate values. Dependent claim 4 is directed toward calculating standard deviation of prices- a commercial activity. Dependent claim 5 is directed toward sales prices are received form third party trade reporting-commercial activity. Dependent claim 6 is directed toward identifying volatility considers beta of …bonds-directed toward applying risk analysis. Dependent claim 7 is directed toward calculating correlation coefficient between bonds within filtered group of nearest neighbor bonds performed by degree of statistical association between bonds sales prices – which is directed toward applying mathematical analysis of prices a commercial activity. Dependent claim 8 is directed toward bond sales prices for pairs of bonds within filtered group of nearest neighbor bonds are received from third party trade reporting and compliance engine-directed toward pricing bonds of a selected group received from a trading entity- commercial activity. Dependent claim 9 is directed toward weighted average index price considers outstanding amount for each bond of group-pricing bonds which is a commercial activity. Dependent claim 10 is directed toward variance for each bond within the group in relation to price stored -commercial activity.
The dependent claim(s) have been examined individually and in combination with the preceding claims, however they do not cure the deficiencies of claim 1. Where all claims are directed to the same abstract idea, “addressing each claim of the asserted patents [is] unnecessary.” Content Extraction & Transmission LLC v. Wells Fargo Bank, Nat 7 Ass ’n, 776 F.3d 1343, 1348 (Fed. Cir. 2014). If applicant believes the dependent claims 2-10 are directed towards patent eligible subject matter, they are invited to point out the specific limitations in the claim that are directed towards patent eligible subject matter.
In reference to Claim 11-20:
STEP 1. Per Step 1 of the two-step analysis, the claims are determined to include a system, as in independent Claim 11 and the dependent claims. Such systems fall under the statutory category of "machine." Therefore, the claims are directed to a statutory eligibility category.
STEP 2A Prong 1. The functions of system claim 11 corresponds to steps of method claim 1. Therefore, claim 11 has been analyzed and rejected as being directed toward an abstract idea of the categories of concepts directed toward mental processes and market activity previously discussed with respect to claim 1.
STEP 2A Prong 2: The identified judicial exception is not integrated into a practical application because the claims fail to provide indications of patent eligible subject matter that integrate the alleged abstract idea into a practical application. The additional elements recited in the claim beyond the abstract idea include a computer system comprising one or more processors and non-transitory computer storage media encoding instructions the one or more processor causing the system to perform functions corresponding to the steps of claim 1.
The claimed processor applied to perform the operations of data analysis for a commercial activity the analysis implemented by the processor including “identify…bonds sharing similar attributes”, “identify a volatility of …bonds” and “calculating correlation coefficient between pairs of bonds”, “computing weighted average index price” and “determining variance for predetermined bonds within a group,…in relation to …index price” which is mere data analysis and evaluation for pricing bonds a commercial activity.
The additional element “one or more processors” is applied to perform the functions “create a filtered group of nearest neighbor bonds excluding bonds with volatilities exceeding a threshold”, “sorting the filtered group of bonds which is data manipulation” and “selecting a predetermined number of bonds from the filtered group”, where the processor is used as a tool for a commercial process. The courts have made clear that manipulation of data without specific requirements in how the manipulation is performed where the limitations only require a generic computer elements to perform the task is insufficient (see BuySafe Inc v Google Inc (765), Mobile Acuity LTD v Blippar Ltd (110F). The asserted claims consisted solely of result-orientated, functional language and omitted any specific requirements as to how the processor functions of the claim were to be performed. The limitations for the data manipulation and organization performed by the processor are recited at a high level with an expected outcome of mere data manipulation.
The claimed system is a field-of-use (/.e., the extent to which (or how) the transformation imposes meaningful limits on the execution of the claimed method steps). The claimed system and its components contributes only nominally or insignificantly to the execution of the claimed method (e.g., in a data gathering step or in a field-of-use limitation) would not provide significantly more (or integrate a judicial exception into a practical application). Mayo, 566 U.S. at 76, 101 USPQ2d at 1967. The Supreme Court disagreed, finding that this step was only a field-of-use limitation and did not provide significantly more than the judicial exception. /d. See MPEP § 2106.05(g) & (h).
The system processor is applied at a high level to perform the limitations 1-3 when considered as a combination are directed toward creating a filtered group of nearest neighbor bonds of the identified bonds sharing similar attributes excluding identified volatilities exceeding threshold which is directed toward a commercial activity. The combination of limitations 4-6 performed by the claimed system “one or more processors” with respect to the created filtered group of limitations 1-3 is directed toward calculating correlating coefficient between pairs, sorting filtered group, selecting a predetermined number of bonds in order to form an index group a commercial activity. The functions performed by the one or more system processors in a combination of limitations 1-6 and 7-8 is directed toward computing a weighted average prices of the group of limitations 1-6 in order to determine a variance for predetermined bonds within the group selected in relation with the computed price – a commercial activity. The claimed functions of the processor are not directed toward any technology when considered as a whole or individually, but rather to perform the identified abstract idea. Accordingly, the limitations individually or as a combination are not directed toward any limitations related to technology for improvement, to provide a solution to a problem rooted in technology, apply the judicial exception with or by use of a particular machine, or apply the judicial exception in a manner that imposes meaningful limits upon a technical environment. Accordingly, none of the claim limitations when considered individually or as a combination of parts or individually are directed toward any indications of patent eligibility under step 2a prong 2. The combination of limitations is directed toward identifying attributes and volatility of bonds what is used to manipulate, sort and select bonds for determining a weighted average index price performed by the one or more processors of the system applied as a tool to perform the abstract idea.
This does not qualify under the MPEP guidance (see MPEP 2106.05 (a)-(c), (e )-(h), for indications of patent eligibility. The claim limitations as a whole, as an ordered combination and the combination of steps not integrate the judicial exception into a practical application as the claim process fails to impose meaningful limits upon the abstract idea. . This is because the claimed subject matter fails to provide additional elements or combination or elements that go beyond applying technology as a tool to perform the identified abstract idea. The functions recited by the mobile device in the claims recite the concept of a financial activity. The claim limitations and specification lacks technical disclosure on what the technical problem was and how the claimed limitations provide a technical solution to a technical problem rather than a solution to a problem found in the abstract idea. Taking the claim elements separately, or as a combination, the operation performed by the mobile device processor and communication unit at each step of the process is purely in terms of results desired and devoid of implementation of details. Technology is not integral to the process as the claimed subject matter is so high level that any generic programming could be applied and the functions could be performed by any known means. Furthermore, the claimed functions do not provide an operation that could be considered as sufficient to provide a technological implementation or application of/or improvement to this concept (i.e. integrated into a practical application).
The integration of elements do not improve upon technology or improve upon computer functionality or capability in how computers carry out one of their basic functions. The integration of elements do not provide a process that allows computers to perform functions that previously could not be performed. The integration of elements do not provide a process which applies a relationship to apply a new way of using an application. The limitations do not recite a specific use machine or the transformation of an article to a different state or thing. The limitations do not provide other meaningful limits beyond generally linking the use of the abstract idea to a particular technological environment. The resource claimed performing the steps is merely a “field of use” application of technology. The instant application, therefore, still appears only to implement the abstract idea to the particular technological environments apply what generic computer functionality in the related arts. The steps are still a combination made to perform a financial activity and does not provide any of the determined indications of patent eligibility set forth in the 2019 USPTO 101 guidance. The additional steps only add to those abstract ideas using generic functions, and the claims do not show improved ways of, for example, an particular technical function for performing the abstract idea that imposes meaningful limits upon the abstract idea.
Moreover, Examiner was not able to identify any specific technological processes that goes beyond merely confining the abstract idea in a particular technological environment, which, when considered in the ordered combination with the other steps, could have transformed the nature of the abstract idea previously identified. 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. The claim provides no technical details regarding how the operations performed by the “resource”. Instead, similar to the claims at issue in Intellectual Ventures I LLC v. Capital One Financial Corp., 850 F.3d 1332 (Fed. Cir. 2017), “the claim language . . . provides only a result-oriented solution with insufficient detail for how a computer accomplishes it. Our law demands more.” Intellectual Ventures, 850 F.3d at 1342 (citing Elec. Power Grp. LLC v. Alstom, S.A., 830 F.3d 1350, 1356 (Fed. Cir. 2016)). The claim is directed to an abstract idea
STEP 2B; The claim(s) does/do not include additional elements that are sufficient to amount to significantly more than the judicial exception because as discussed above with respect to concepts of the abstract idea into a practical application. The additional elements beyond the abstract idea include a computer system comprising one or more processors, non-transitory computer-readable media encoding instructions executed by the one or more processor of the system to perform the operations “identify”, “create …filtered group of …bonds”, “calculate correlation coefficient”, “sort filtered group”, “select …number of bonds”, “compute weighted average…price”, and “determine a variance for …bonds…in relation to the ….price” ----are some of the most basic functions of a computer system processors.
Taking the claim elements separately, the function performed by the computer system one or more processors at each step of the process is purely conventional. Generic computer elements and basic computer functions applied to perform an abstract idea, as referenced in Alice that are not enough to qualify as “significantly more” include “apply it” (or an equivalent) with an abstract idea, mere instructions to implement the abstract idea on a computer or requiring no more than a generic compute to perform generic computer functions that are well understood activities known to the industry. As a result, none of the hardware recited by the system claims offers a meaningful limitation beyond generally linking the use of the method to a particular technological environment, that is, implementation via computers. .. . The claim limitations do not recite that any of the “one or more processors” perform more than a high level generic function ... . None of the limitations recite technological implementation details for any of these steps, but instead recite only results desired to be achieved by any and all possible means. .. . Mere instructions to apply an exception using a generic computer component cannot provide an inventive concept.
When the claims are taken as a whole, as an ordered combination, the combination of steps does not add “significantly more” by virtue of considering the steps as a whole, as an ordered combination. All of these computer functions are generic, routine, conventional computer activities that are performed only for their conventional uses. See Elec. Power Grp. v. Alstom S.A., 830 F.3d 1350, 1353 (Fed. Cir. 2016). Also see In re Katz Interactive Call Processing Patent Litigation, 639 F.3d 1303, 1316 (Fed. Cir. 2011) ("Absent a possible narrower construction of the terms “generating”, “transmitting”, “intercepting”, identifying”, “determining”, “replacing” and “routing' ... are functions can be achieved by any general purpose computer without special programming"). None of these activities are used in some unconventional manner nor do any produce some unexpected result. In short, each step and as a combination does no more than require a generic computer to perform generic computer functions.
As to the data operated upon, "even if a process of collecting and analyzing information is 'limited to particular content' or a particular 'source,' that limitation does not make the collection and analysis other than abstract." SAP America, Inc. v. Invest Pic LLC, 898 F.3d 1161, 1168 (Fed. Cir. 2018). Considered as an ordered combination, the computer components of Applicant’s claimed functions add nothing that is not already present when the steps are considered separately. The sequence of data reception-analysis modification-transmission is equally generic and conventional. See Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 715 (Fed. Cir. 2014) (sequence of receiving, selecting, offering for exchange, display, allowing access, and receiving payment recited as an abstraction), Inventor Holdings, LLC v. Bed Bath & Beyond, Inc., 876 F.3d 1372, 1378 (Fed. Cir. 2017) (sequence of data retrieval, analysis, modification, generation, display, and transmission), Two-Way Media Ltd. v. Comcast Cable Communications, LLC, 874 F.3d 1329, 1339 (Fed. Cir. 2017) (sequence of processing, routing, controlling, and monitoring). The ordering of the steps is therefore ordinary and conventional. The analysis concludes that the claims do not provide an inventive concept because the additional elements recited in the claims do not provide significantly more than the recited judicial exception.
According to 2106.05 well-understood and routine processes to perform the abstract idea is not sufficient to transform the claim into patent eligibility. As evidence the examiner provides:
The specification discloses:
[0033] Figure 1 illustrates a schematic of a computer system 100 designed for
identifying price outliers among assets within a similarly situated class of assets. As depicted
in Figure 1, the computer system 100 encompasses a computing environment comprised of
one or more client devices 102 connected to a server device 104 via a network 106. The one
or more client devices 102 can be computing devices equipped with processors and memory,
capable of initiating various tasks related to asset valuation. These client devices 102 can
encompass a variety of computing devices such as desktop computers, laptops, integrated
development environment systems, or other hardware capable of interfacing with the
components of the network 106.
[0034] The server device 104, which may be a single server or a collection of servers
within a server farm, possesses computing resources including processors and data storage
repositories, enabling the one or more client devices 102 to engage in complex tasks
involving the receipt and processing of data from a variety of sources. The analytical
capabilities of the server device 104 are directed at analyzing data to facilitate asset valuation
and price outlier identification processes.
[0035] Although depicted as physically distinct devices, the one or more client devices
102 and the server device 104 can share resources such as processors and databases, enabling
a unified approach to analyzing interactions and formulating response strategies. In certain
embodiments, the server device 104 may also incorporate resources from a third-party vendor
or contracting partner, depicted as a third-party computing device 108. These resources from
the third-party computing device 108 can include one or more generative pre-trained
transformers or other algorithms or features to improve the functionality of the modules
described herein.
[0101] As illustrated in the embodiment of Figure 4, the example server device 104,
which provides the functionality described herein, can include at least one central processing
unit ("CPU") 130, a system memory 136, and a system bus 148 that couples the system
memory 136 to the CPU 130. The system memory 136 includes a random access memory
("RAM") 310 and a read-only memory ("ROM") 140. A basic input/output system
containing the basic routines that help transfer information between elements within the
computer system 100, such as during startup, is stored in the ROM 140. The computer system
100 further includes a mass storage device 142. The mass storage device 142 can store
software instructions and data. A central processing unit, system memory, and mass storage
device similar to that shown can also be included in the other computing devices disclosed
herein.
[0102] The mass storage device 142 is connected to the CPU 130 through a mass storage
controller (not shown) connected to the system bus 148. The mass storage device 142 and its
associated computer-readable data storage media provide non-volatile, non-transitory storage
for the computer system 100. Although the description of computer-readable data storage
media contained herein refers to a mass storage device, such as a hard disk or solid-state disk,
it should be appreciated by those skilled in the art that computer-readable data storage media
can be any available non-transitory, physical device, or article of manufacture from which the
central display station can read data and/or instructions.
The instant application, therefore, still appears to only implement the abstract ideas to the particular technological environments using what is generic components and functions in the related arts. The claim is not patent eligible.
The remaining dependent claims—which impose additional limitations—also fail to claim patent-eligible subject matter because the limitations cannot be considered statutory. In reference to claims 12-20 these dependent claim have also been reviewed with the same analysis as independent claim 11. The dependent claim(s) have been examined individually and in combination with the preceding claims, however they do not cure the deficiencies of claim 11. Dependent claim 12 is directed toward evaluating attributes of claim 10 including financial related attributes- commercial activity. Dependent claim 13 is directed toward establishing a sensitivity for k-nearest neighbor algorithm which is directed toward amounting to no more than mere instructions to calculate values. Dependent claim 14 is directed toward calculating standard deviation of prices- a commercial activity. Dependent claim 15 is directed toward sales prices are received form third party trade reporting-commercial activity. Dependent claim 16 is directed toward identifying volatility considers beta of …bonds-directed toward applying risk analysis. Dependent claim 17 is directed toward calculating correlation coefficient between bonds within filtered group of nearest neighbor bonds performed by degree of statistical association between bonds sales prices – which is directed toward applying mathematical analysis of prices a commercial activity. Dependent claim 18 is directed toward bond sales prices for pairs of bonds within filtered group of nearest neighbor bonds are received from third party trade reporting and compliance engine-directed toward pricing bonds of a selected group received from a trading entity- commercial activity. Dependent claim 19 is directed toward weighted average index price considers outstanding amount for each bond of group-pricing bonds which is a commercial activity. Dependent claim 20 is directed toward variance for each bond within the group in relation to price stored -commercial activity.
Where all claims are directed to the same abstract idea, “addressing each claim of the asserted patents [is] unnecessary.” Content Extraction & Transmission LLC v. Wells Fargo Bank, Nat 7 Ass ’n, 776 F.3d 1343, 1348 (Fed. Cir. 2014). If applicant believes the dependent claims 12-20 are directed towards patent eligible subject matter, they are invited to point out the specific limitations in the claim that are directed towards patent eligible subject matter.
Claim Rejections - 35 USC § 103
In the event the determination of the status of the application as subject to AIA 35 U.S.C. 102 and 103 (or as subject to pre-AIA 35 U.S.C. 102 and 103) is incorrect, any correction of the statutory basis (i.e., changing from AIA to pre-AIA ) for the rejection will not be considered a new ground of rejection if the prior art relied upon, and the rationale supporting the rejection, would be the same under either status.
The following is a quotation of 35 U.S.C. 103 which forms the basis for all obviousness rejections set forth in this Office action:
A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains. Patentability shall not be negated by the manner in which the invention was made.
The factual inquiries for establishing a background for determining obviousness under 35 U.S.C. 103 are summarized as follows:
1. Determining the scope and contents of the prior art.
2. Ascertaining the differences between the prior art and the claims at issue.
3. Resolving the level of ordinary skill in the pertinent art.
4. Considering objective evidence present in the application indicating obviousness or nonobviousness.
Claim(s) 1-2, 4, 6-7 and 9; Claims 11-12, 14, 16-17 and 19 is/are rejected under 35 U.S.C. 103 as being unpatentable over US Pub No. 2025/0299256 A1 by Azeez et al (Azeez), and further in view of CN 109034545 A By Cao et al. (Cao).
In reference to Claim 1:
Azeez teaches:
A method for identifying price outliers among bonds [stock] within a similarly situated class ((Azeez) in at least Abstract; para 0071), comprising:
identifying a plurality of bonds [stock] sharing similar attributes through a k-nearest neighbor algorithm to establish a group of nearest neighbor bonds ((Azeez) in at least Fig. 7; para 0226, para 0239, para 0241, para 0252-0253);
identifying a volatility for one or more of the plurality of bonds [stock] in the group of nearest neighbor bonds ((Azeez) in at least Fig. 21; para 0222, para 0225);
creating a filtered group of nearest neighbor bonds [stock] by excluding those bonds with volatilities exceeding a predefined threshold ((Azeez) in at least para 0222, para 0225, para 0227, para 0234, para 0247; Claim 11);
calculating a … coefficient between pairs of the plurality of bonds [stock] within the filtered group of nearest neighbor bonds ((Azeez) in at least para 0256-0257 wherein the prior art teaches coefficients scrutinized to assess statistical significance of each coefficient to determine whether relationships are real or by chance); …
selecting a predetermined number of bonds [stock] from the filtered group of nearest neighbor bonds to form an index group ((Azeez) in at least Abstract; para 0006, para 0020, para 0042-0043, para 0045-0048, para 0102, para 0115-0118, para 0125-0133, para 0147-0148, para 0150, para 0152, para 0166, para 0203-0204, para 0207-0213 wherein the prior art teaches adding/removing stocks based on analysis and calculation, para 0216);
computing a weighted average index price for the index group ((Azeez) in at least para 0006, para 0047, para 0117, para 0133-0134, para 0141-0146, para 0202, para 0227-0228, para 0233-0234); and
determining a variance for the predetermined number of bonds [stock] within the index group in relation to the weighted average index price ((Azeez) in at least para 0126, para 0164, para 0223, para 0227, para 0246, para 0254, para 0257; Claim 12).
Azeez does not explicitly teach:
correlation coefficient
sorting the filtered group of nearest neighbor bonds based on the correlation coefficient of the pairs of bonds
Cao teaches:
calculating a correlation coefficient between pairs of the plurality of bonds within the filtered group of nearest neighbor bonds ((Cao) in at least para 0007, para 0013, para 0016-0017, para 0031)
creating a filtered group of nearest neighbor bonds by excluding those bonds with volatilities exceeding a predefined threshold ((Cao) in at least Abstract; para 0007, para 0009, para 0013, para 0016-0019, para 0031)
sorting the filtered group of nearest neighbor bonds based on the correlation coefficient of the pairs of bonds ((Cao) in at least para 0007, para 0013, para 0016-0019)
Both Azeez and Cao are directed toward index selecting process related to stock market data. Although Azeez does not explicitly teach calculating a correlation index, Azeez does teach conducting variance inflation factor (VIF) analysis and determining whether the VIF value exceeds a threshold which indicates a level or correlation (see para 0254) in the parameters of the market data applied in the analysis. Cao teaches the motivation of selecting the measure index and calculating each index by calculating a correlation coefficient of index used to delete information greater than the index threshold value through correlation and cluster analysis which quantizes and optimizes the index selection criteria and screening for a more balanced selection index. It would have been obvious to one having ordinary skill before the effective filing date of the claimed invention to modify the index creation process of Azeez to include sorting the filtered group of stock of the market based on the calculated correlation coefficient of the index as taught by Cao since Cao teaches the motivation of selecting the measure index and calculating each index by calculating a correlation coefficient of index used to delete information greater than the index threshold value through correlation and cluster analysis which quantizes and optimizes the index selection criteria and screening for a more balanced selection index.
In reference to claim 2:
The combination of Azeez and Cao discloses the limitations of independent claim 1. Azeez further discloses the limitations of dependent claim 2
The method of claim 1 (see rejection of claim 1 above), wherein the k-nearest neighbor algorithm evaluates attributes:
including coupon, yield, ratings, maturity, sector, industry, and embedded options. ((Azeez) in at least para 0003, para 0165 wherein the prior art teaches algorithm flag stocks with unexpected deviations from sectoral norms, para 0202 wherein the prior art teaches the weights representing proportions of each stock reflects performance of specific sectors of market, para 0208, para 0215, para 0220, para 0261)
In reference to claim 4:
The combination of Azeez and Cao discloses the limitations of independent claim 1. Azeez further discloses the limitations of dependent claim 4
The method of claim 1 (see rejection of claim 1 above),
wherein identifying the volatility includes calculating a standard deviation of bond sales prices over a predetermined time period. ((Azeez) in at least para 0222; claim 11)
In reference to claim 6:
The combination of Azeez and Cao discloses the limitations of independent claim 1. Azeez further discloses the limitations of dependent claim 6
The method of claim 1 (see rejection of claim 1 above),
wherein identifying the volatility considers a beta of one or more of the plurality of bonds. ((Azeez) in at least para 0234)
In reference to claim 7:
The combination of Azeez and Cao discloses the limitations of independent claim 1. Azeez further discloses the limitations of dependent claim 7
The method of claim 1 (see rejection of claim 1 above),
wherein calculating the correlation coefficient between the pairs of bonds within the filtered group of nearest neighbor bonds is performed by determining a degree of statistical association between bond sales prices over a specified period of time. ((Azeez) in at least para 0253-0254, para 0256-0257 wherein the prior art teaches coefficients scrutinized to assess statistical significance of each coefficient to determine whether relationships are real or by chance)
Azeez does not explicitly teach:
wherein calculating the … coefficient between the pairs of bonds …
Cao teaches:
wherein calculating the correlation coefficient between the pairs of bonds within the filtered group of nearest neighbor bonds is performed by determining a degree of statistical association between bond sales prices over a specified period of time. ((Cao) in at least Abstract; para 0007-0009, para 0013, para 0017-0019, para 0031)
Both Azeez and Cao are directed toward index selecting process related to stock market data. Although Azeez does not explicitly teach calculating a correlation index, Azeez does teach conducting variance inflation factor (VIF) analysis and determining whether the VIF value exceeds a threshold which indicates a level or correlation (see para 0254) in the parameters of the market data applied in the analysis. Cao teaches the motivation of selecting the measure index and calculating each index by calculating a correlation coefficient of index used to delete information greater than the index threshold value through correlation and cluster analysis which quantizes and optimizes the index selection criteria and screening for a more balanced selection index. It would have been obvious to one having ordinary skill before the effective filing date of the claimed invention to modify the index creation process of Azeez to include sorting the filtered group of stock of the market based on the calculated correlation coefficient of the index as taught by Cao since Cao teaches the motivation of selecting the measure index and calculating each index by calculating a correlation coefficient of index used to delete information greater than the index threshold value through correlation and cluster analysis which quantizes and optimizes the index selection criteria and screening for a more balanced selection index.
In reference to claim 9:
The combination of Azeez and Cao discloses the limitations of independent claim 1. Azeez further discloses the limitations of dependent claim 9
The method of claim 1 (see rejection of claim 1 above),
wherein the weighted average index price considers a corresponding outstanding amount for each bond of the index group. ((Azeez) in at least FIG. 19; para 0047, para 0117, para 0133-0134, para 0138-0142, para 0146, para 0202-0203, para 0206, para 0216, para 0227-0228)
In reference to claim 11:
The combination of Azeez and Cao discloses the limitations of independent claim 11.
The computer system functional processes of claim 11 correspond to the method steps of claim 1. The additional limitations recited in claim 11 that go beyond the limitations of claim 1 include the computer system ((Azeez) in at least para 0021) to perform the operation that correspond to claim 1 include the structure comprising:
one or more processors ((Azeez) in at least para 0104-0106);
a non-transitory computer-readable media encoding instructions operable when executed by one or more of the processors to cause the computer system ((Azeez) in at least para 0035, para 0095, para 0103) to perform operations corresponding to the steps of claim 1.
Therefore, claim 11 has been analyzed and rejected as previously discussed with respect to claim 1.
In reference to claim 12:
The combination of Azeez and Cao discloses the limitations of independent claim 11. Azeez further discloses the limitations of dependent claim 12
The functions of Machine claim 12 corresponds to steps of method claim 2. Therefore, claim 12 has been analyzed and rejected as previously discussed with respect to claim 2
In reference to claim 14:
The combination of Azeez and Cao discloses the limitations of independent claim 11. Azeez further discloses the limitations of dependent claim 14
The functions of Machine claim 14 corresponds to steps of method claim 4. Therefore, claim 14 has been analyzed and rejected as previously discussed with respect to claim 4
In reference to claim 16:
The combination of Azeez and Cao discloses the limitations of independent claim 11. Azeez further discloses the limitations of dependent claim 16
The functions of Machine claim 16 corresponds to steps of method claim 6. Therefore, claim 16 has been analyzed and rejected as previously discussed with respect to claim 6
In reference to claim 17:
The combination of Azeez and Cao discloses the limitations of independent claim 11. Azeez further discloses the limitations of dependent claim 17
The functions of Machine claim 17 corresponds to steps of method claim 7. Therefore, claim 17 has been analyzed and rejected as previously discussed with respect to claim 7
In reference to claim 19:
The combination of Azeez and Cao discloses the limitations of independent claim 11. Azeez further discloses the limitations of dependent claim 19
The functions of Machine claim 19 corresponds to steps of method claim 7. Therefore, claim 19 has been analyzed and rejected as previously discussed with respect to claim 9
Claim(s) 3 of claim 2 above; Claim(s) 13 of claim 12 above is/are rejected under 35 U.S.C. 103 as being unpatentable over US Pub No. 2025/0299256 A1 by Azeez et al (Azeez), in view of CN 109034545 A By Cao et al. (Cao), and further in view of “An Appraise of KNN to the Perfection” by Rani et al. (Rani)
In reference to claim 3:
The combination of Azeez and Cao discloses the limitations of dependent claim 2. Azeez further discloses the limitations of dependent claim 3
The method of claim 2 (see rejection of claim 2 above), further comprising
Azeez does not explicitly teach:
establishing a sensitivity for the k-nearest neighbor algorithm in an evaluation of each attribute.
Rani teaches:
establishing a sensitivity for the k-nearest neighbor algorithm in an evaluation of each attribute.((Rani) in at least section 2.1 page 15 and section 2.2 wherein the prior art teaches unrelated attributes are reduced and weights assigned to each attribute; Table 1
Both Azeez and Rani teach applying KNN algorithms and weighting attributes of data analyzed. Rani teaches the motivation when using a KNN algorithm with respect to unrelated attributes of reducing and assigning weights to each attribute in order to increase efficiency of the KNN Rani teaches the motivation when using a KNN algorithm with respect to unrelated attributes of reducing and assigning weights to each attribute in order to increase efficiency of the KNN algorithm. It would have been obvious to one having ordinary skill before the effective filing date of the claimed invention to modify the KNN and weighting of Azeez to include establishing sensitivity to the KNN algorithm as taught by Rani since Rani teaches the motivation when using a KNN algorithm with respect to unrelated attributes of reducing and assigning weights to each attribute in order to increase efficiency of the KNN algorithm solving the sensitivity problem of selecting the neighborhood size “k” in the KNN in order to deal with outliers.
In reference to claim 13:
The combination of Azeez and Cao discloses the limitations of dependent claim 12. Azeez further discloses the limitations of dependent claim 13
The functions of Machine claim 13 corresponds to steps of method claim 3. Therefore, claim 13 has been analyzed and rejected as previously discussed with respect to claim 3
Claim(s) 5 of claim 4 above; Claim(s) 15 of claim 14 above is/are rejected under 35 U.S.C. 103 as being unpatentable over US Pub No. 2025/0299256 A1 by Azeez et al (Azeez), in view of CN 109034545 A By Cao et al. (Cao), and further in view of US Patent No. 7,865,426 B2 by Volpert (Volpert)
In reference to claim 5:
The combination of Azeez and Cao discloses the limitations of independent claim 1. Azeez further discloses the limitations of dependent claim 5
The method of claim 4 (see rejection of claim 4 above),
Azeez does not explicitly teach:
wherein the bond sales prices are received from a third-party trade reporting and compliance engine.
Volpert teaches:
wherein the bond sales prices are received from a third-party trade reporting and compliance engine.((Volpert) in at least Col 151 lines 42-56)
Both Azeez and Volpert are directed toward receiving/monitoring market prices. Volpert teaches the motivation of accessing bond prices that are available by receiving prices from trade reporting and compliance engines to clients. It would have been obvious to one having ordinary skill before the effective filing date of the claimed invention to modify the monitoring of prices of Azeez to include receiving prices from Vopert since Volpert teaches the motivation of accessing bond prices that are available by receiving prices from trade reporting and compliance engines to clients.
In reference to claim 15:
The combination of Azeez and Cao discloses the limitations of dependent claim 14. Azeez further discloses the limitations of dependent claim 15
The functions of Machine claim 15 corresponds to steps of method claim 5. Therefore, claim 15 has been analyzed and rejected as previously discussed with respect to claim 5
Claim(s) 8 of claim 7 above, Claim(s) 18 of claim 17 above is/are rejected under 35 U.S.C. 103 as being unpatentable over US Pub No. 2025/0299256 A1 by Azeez et al (Azeez), in view of CN 109034545 A By Cao et al. (Cao), and further in view of US Pub No. 2020/0058070 A1 by Mohs et al. (Mohs)
In reference to claim 8:
The combination of Azeez and Cao discloses the limitations of dependent claim 7. Azeez further discloses the limitations of dependent claim 8
The method of claim 7 (see rejection of claim 7 above),
wherein the bond sales prices for the pairs of bonds within the filtered group of nearest neighbor bonds are received…((Azeez) in at least para 0125, para 0160, para 0206, para 0217, para 0221-0223, para 0226-0227, para 0245-0246)
Azeez does not explicitly teach:
wherein the bond sales prices for the pairs of bonds …are received from a third-party trade reporting and compliance engine, and recorded in blockchain.
Mohs teaches:
wherein the bond sales prices for the pairs of bonds … are received from a third-party trade reporting and compliance engine, and recorded in blockchain. ((Moh) in at least para 0037-0038, para 0057-0058, para 0085)
Both Azeez and Mohs teaches toward receiving/monitoring market prices. Moh teaches the motivation of receiving and extracting data from external sources under regulatory or legal requirements for receiving changes in price or market value of securities. It would have been obvious to one having ordinary skill before the effective filing date of the claimed invention to modify the monitoring of prices of Azeez to include receiving prices from Moh since Moh teaches the motivation of receiving and extracting data from external sources under regulatory or legal requirements for receiving changes in price or market value of securities.
Both Azeez and Moh teach applying databases for use in data analytics. According to KSR common sense rationale, simple substitution of one known element for another to obtain predictable result is obvious. The prior art Azeez teaches applying databases with differed from the claimed device by the substation of a generic database for a blockchain database (distributive ledger). The prior art Moh provide evidence that the substituted database and its functions where known in the art. Based on common sense rationale, one of ordinary skill in the art could have substituted one known element for another, and the results of the substitution would have been predictable
In reference to claim 18:
The combination of Azeez and Cao discloses the limitations of dependent claim 17. Azeez further discloses the limitations of dependent claim 18
The functions of Machine claim 18 corresponds to steps of method claim 8. Therefore, claim 18 has been analyzed and rejected as previously discussed with respect to claim 8
Claim(s) 10 of claim 1 above, Claim(s) 20 of claim 11 above is/are rejected under 35 U.S.C. 103 as being unpatentable over US Pub No. 2025/0299256 A1 by Azeez et al (Azeez), in view of CN 109034545 A By Cao et al. (Cao), and further in view of US Pub No. 2023/0043702 A1 by Sells et al (Sells)
In reference to claim 10:
The combination of Azeez and Cao discloses the limitations of independent claim 1. Azeez further discloses the limitations of dependent claim 10.
The method of claim 1 (see rejection in claim 1 above),
Azeez does not explicitly teach:
wherein the variance for each bond within the index group in relation to the weighted average index price is recorded in blockchain.
Sells teaches:
wherein the variance for each bond within the index group in relation to the weighted average index price is recorded in blockchain.((Sells) in at least Abstract; para 0040, para 0126, para 0147, para 0309, para 0378),
Both Azeez and Sells are directed toward analyzing and determining variance of pricing in transactional data analysis. Sells teaches the motivation of calculating price volatility data for given market index that is stored in one or more libraries and/or data stores of the model in order to apply the volatility data as inputs for algorithms/models to perform the pricing analysis. It would have been obvious to one having ordinary skill before the effective filing date of the claimed invention to modify the process for determining volatility data of Azeez to include storing the calculated volatility data as taught by Sells since Sells teaches the motivation of calculating price volatility data for given market index that is stored in one or more libraries and/or data stores of the model in order to apply the volatility data as inputs for algorithms/models to perform the pricing analysis.
Both Azeez and Sells teach applying databases for use in data analytics. According to KSR common sense rationale, simple substitution of one known element for another to obtain predictable result is obvious. The prior art Azeez teaches applying databases with differed from the claimed device by the substation of a generic database for a blockchain database (distributive ledger). The prior art Sells provide evidence that the substituted database and its functions where known in the art. Based on common sense rationale, one of ordinary skill in the art could have substituted one known element for another, and the results of the substitution would have been predictable
In reference to claim 20:
The combination of Azeez and Cao discloses the limitations of independent claim 11. Azeez further discloses the limitations of dependent claim 20
The functions of Machine claim 20 corresponds to steps of method claim 10. Therefore, claim 20 has been analyzed and rejected as previously discussed with respect to claim 10
Conclusion
The prior art made of record and not relied upon is considered pertinent to applicant's disclosure. CN 109165805 by Chang et al translation
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/MARY M GREGG/Examiner, Art Unit 3695