DETAILED ACTION
This Final Office Action is in response the application filed on 08/14/2024 and the Amendment & Remark filed on 12/26/2025.
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 .
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 claimed invention is directed to a judicial exception (i.e., a law of nature, a natural phenomenon, or an abstract idea) without significantly more.
As an initial matter, the claims as a whole are to a process, an apparatus and a manufacture, which falls within one or more statutory categories. (Step 1: YES) The recitation of the claimed invention is then further analyzed as follow, in which the abstract elements are boldfaced.
Claim 1 recites:
A method comprising:
collecting, by a computing system, information about one or more risk exposures associated with an organization having a risk policy;
applying, by the computing system, a forward inflation index model to the information about the risk exposures, wherein the forward inflation index model has a multifactor volatility structure;
determining, by the computing system and based on applying the forward inflation index model to the information about the risk exposures, a plurality of risk assessments; and
taking action, by the computing system and based on the risk assessments, to cause another computing system to perform an operation to implement the risk policy,
wherein taking action includes sending control signals to the other computing system once the plurality of risk assessments have been determined, the control signals instructing the other computing system to communicate with a regulatory system to report information about the plurality of risk assessments.
Claim 12 recites:
A computing system comprising processing circuitry and a storage device, wherein the processing circuitry has access to the storage device and is configured to:
collect information about one or more risk exposures associated with an organization having a risk policy;
apply a forward inflation index model to the information about the risk exposures, wherein the forward inflation index model has a multifactor volatility structure; determine,
based on applying the forward inflation index model to the information about the risk exposures, a plurality of risk assessments; and
take action, based on the risk assessments, to cause another computing system to perform an operation to implement the risk policy,
wherein taking action includes sending control signals to the other computing system once the plurality of risk assessments have been determined, the control signals instructing the other computing system to communicate with a regulatory system to report information about the plurality of risk assessments.
Claim 20 recites:
A non-transitory computer-readable medium comprising instructions that, when executed, configure processing circuitry of a computing system to:
collect information about one or more risk exposures associated with an organization having a risk policy;
apply a forward inflation index model to the information about the risk exposures, wherein the forward inflation index model has a multifactor volatility structure; determine,
based on applying the forward inflation index model to the information about the risk exposures, a plurality of risk assessments; and
take action, based on the risk assessments, to cause another computing system to perform an operation to implement the risk policy,
wherein taking action includes sending control signals to the other computing system once the plurality of risk assessments have been determined, the control signals instructing the other computing system to communicate with a regulatory system to report information about the plurality of risk assessments.
Claims 2 and 13 recite:
implementing, by the computing system, the multifactor volatility structure for the forward inflation index model using Principal Component Analysis.
Claims 3 and 14 recite:
wherein the risk exposures pertain to positions in market instruments having different tenors, and wherein applying the forward inflation index model further comprises: applying a forward inflation index model configured to model the different tenors of the market instruments.
Claims 4 and 15 recite:
wherein applying the forward inflation index model further comprises: applying a forward inflation index model that uses a plurality of leverage functions to capture market volatility skew.
Claims 5 and 16 recite:
wherein applying the forward inflation index model further comprises: using Dupire formulas to capture the market volatility skew.
Claims 6 and 17 recite:
wherein at least some factors in the multifactor inflation index model are each associated with one of the plurality of leverage functions, and wherein the method further comprises: calibrating, by the computing system, the plurality of leverage functions using a Monte Carlo simulation.
Claims 7 and 18 recite:
wherein applying the forward inflation index model further comprises: applying a forward inflation index model that uses Dupire formulas to capture market volatility skew; and creating an uncalibrated forward inflation index model by eliminating at least one low order term in the Dupire formulas.
Claims 8 and 19 recite:
wherein taking action includes: sending control signals to an internal system once the plurality of risk assessments have been determined, the control signals instructing the internal system to perform the operation.
Claim 9 recites:
wherein taking action includes: sending control signals to an external system once the plurality of risk assessments have been determined, the control signals instructing the external system to adjust a position underlying at least one of the risk exposures.
Claim 10 recites:
wherein determining the plurality of risk assessments includes: determining an effect that a default by a counterparty would have on at least one of the risk exposures associated with the organization.
Claim 11 recites:
wherein the risk exposures pertain to a plurality of trades with a counterparty involving a first type of instrument and a second type of instrument, and wherein determining the plurality of risk assessments includes: netting exposures for the first type of instrument with exposures for the second type of instrument.
Based on the limitations above, the claims describe a process that covers managing risk policy using forward inflation index model. Managing risk policy is considered to be a fundamental economic practice, which falls within the “Certain Methods of Organizing Human Activity” grouping of abstract ideas, while forward inflation index model is a mathematical concept. See, e.g., RecogniCorp, LLC v. Nintendo Co., 855 F.3d 1322, 1327, 122 USPQ2d 1377 (Fed. Cir. 2017) (“Adding one abstract idea (math) to another abstract idea (encoding and decoding) does not render the claim non-abstract”) As such, the claim(s) recite(s) a Judicial Exception. (Step 2A prong one: Yes)
This analysis then evaluates whether the claims as a whole integrates the recited Judicial Exception into a practical application of the exception. In particular, the claims recite the additional element(s) of “computing system”, “A computing system comprising processing circuitry and a storage device, wherein the processing circuitry has access to the storage device and is configured to” and “A non-transitory computer-readable medium comprising instructions that, when executed, configure processing circuitry of a computing system to” as a mere tool to perform the steps of the Judicial Exception, which encompasses no more than Mere Instruction to Apply.
For example, the limitation “collecting, by a computing system, information about one or more risk exposures associated with an organization having a risk policy” encompasses no more than generically invoking a generic computing system to apply the Judicial Exception step of collecting information about the one or more risk exposures;
the limitation “applying, by the computing system, a forward inflation index model to the information about the risk exposures, wherein the forward inflation index model has a multifactor volatility structure” encompasses no more than generically invoking a generic computing system to apply the Judicial Exception step of applying the forward inflation index model to the information;
the limitation “determining, by the computing system and based on applying the forward inflation index model to the information about the risk exposures, a plurality of risk assessments” encompasses no more than generically invoking a generic computing system to apply the Judicial Exception step of determining the plurality of risk assessment;
the limitation “taking action, by the computing system and based on the risk assessments, to cause another computing system to perform an operation to implement the risk policy” encompasses no more than generically invoking a generic computing system to apply the Judicial Exception step of causing another entity to perform an operation to implement the risk policy;
the limitation “wherein taking action includes sending control signals to the other computing system once the plurality of risk assessments have been determined, the control signals instructing the other computing system to communicate with a regulatory system to report information about the plurality of risk assessments” encompasses no more than generically invoking a generic computing system to apply the Judicial Exception step of instructing another entity to report information about the plurality of risk assessment to a regulatory entity;
the limitation “implementing, by the computing system, the multifactor volatility structure for the forward inflation index model using Principal Component Analysis” encompasses no more than generically invoking a generic computing system to apply the Judicial Exception step of implementing the model using PCA;
the limitation “wherein the risk exposures pertain to positions in market instruments having different tenors, and wherein applying the forward inflation index model further comprises: applying a forward inflation index model configured to model the different tenors of the market instruments” encompasses no more than generically invoking a generic computing system to apply the Judicial Exception step of applying the model to the different tenors of the market instructions;
the limitation “wherein applying the forward inflation index model further comprises: applying a forward inflation index model that uses a plurality of leverage functions to capture market volatility skew” encompasses no more than generically invoking a generic computing system to apply the Judicial Exception step of applying the model that uses a plurality of leverage functions;
the limitation “wherein applying the forward inflation index model further comprises: using Dupire formulas to capture the market volatility skew” encompasses no more than generically invoking a generic computing system to apply the Judicial Exception step of using Dupire formulas;
the limitation “wherein at least some factors in the multifactor inflation index model are each associated with one of the plurality of leverage functions, and wherein the method further comprises: calibrating, by the computing system, the plurality of leverage functions using a Monte Carlo simulation” encompasses no more than generically invoking a generic computing system to apply the Judicial Exception step of calibrating the plurality of leverage function using a Monte Carlo simulation;
the limitation “wherein applying the forward inflation index model further comprises: applying a forward inflation index model that uses Dupire formulas to capture market volatility skew; and creating an uncalibrated forward inflation index model by eliminating at least one low order term in the Dupire formulas” encompasses no more than generically invoking a generic computing system to apply the Judicial Exception step of using Dupire formulas and creating the uncalibrated forward inflation index model by eliminating the at least one low order term in the Dupire formulas;
the limitation “wherein taking action includes: sending control signals to an internal system once the plurality of risk assessments have been determined, the control signals instructing the internal system to perform the operation” encompasses no more than generically invoking a generic computing system to apply the Judicial Exception step of instructing an internal system to perform the operation;
the limitation “wherein taking action includes: sending control signals to an external system once the plurality of risk assessments have been determined, the control signals instructing the external system to adjust a position underlying at least one of the risk exposures” encompasses no more than generically invoking a generic computing system to apply the Judicial Exception step of instructing an external system to perform the operation;
the limitation “wherein determining the plurality of risk assessments includes: determining an effect that a default by a counterparty would have on at least one of the risk exposures associated with the organization” encompasses no more than generically invoking a generic computing system to apply the Judicial Exception step of determining the effect that a default by a counterparty would have on the at least one of the risk exposures;
the limitation “wherein the risk exposures pertain to a plurality of trades with a counterparty involving a first type of instrument and a second type of instrument, and wherein determining the plurality of risk assessments includes: netting exposures for the first type of instrument with exposures for the second type of instrument” encompasses no more than generically invoking a generic computing system to apply the Judicial Exception step of determining risk assessment by netting exposures for the first and second type of instrument;
Other than being generally linked to the steps of the Judicial Exception, the additional elements in the above step(s) is/are recited at a high-level of generality, without technological detail of how the particular steps are performed technologically. The additional element(s) of “memory” and/or “non-transitory storage medium” are generically recited to store data and/or instructions of the Judicial Exception.
The examiner noted generic computer systems are appended to abstract elements but found that to be mere instructions to implement the Judicial Exception idea on a computer.
Indeed, the instant claims (1) attempted to cover a solution to an identified problem with no restriction on how the result is accomplished and no description of the mechanism for accomplishing the result; (2) used of a computer or other machinery in its ordinary capacity for economic or other tasks or simply added a general purpose computer or computer components after the fact to the Judicial Exception and (3) generally applied the Judicial Exception to a generic computing environment without limitation indicative of practical application (See MPEP 2106.04(d)I). Thus, the claims are no more than Mere Instruction to Apply the Judicial Exception (See MPEP 2106.05(f)) or adding insignificant extra-solution activity to the judicial exception (See MPEP 2106.05(g)), which do not integrate the cited Judicial Exception into practical application (Step 2A prong two: No) The claims are directed to a Judicial Exception.
The claim does not include additional elements that are sufficient to amount to significantly more than the judicial exception. As discussed above with respect to integration of the abstract idea into a practical application, the additional element of using a processor to manage risk policy to no more than mere instructions to apply the exception using generic computer components. Mere instructions to apply an exception using a generic computer component cannot provide an inventive concept. No additional element currently recited in the claims amount the claims to be significantly more than the cited abstract idea. (Step 2B: No)
Therefore, claims 1-20 are rejected under 35 U.S.C. 101 as being directed to non-statutory subject matter.
Response to Arguments
Applicant's arguments filed on 12/26/2025 have been fully considered but they are not persuasive.
Regarding the applicant’s argument that the claims as amended do not recite a Judicial Exception, the examiner respectfully disagrees. In particular, the addition of a limitation “wherein taking action includes sending control signals to the other computing system once the plurality of risk assessments have been determined, the control signals instructing the other computing system to communicate with a regulatory system to report information about the plurality of risk assessments” only further added to the description of the cited Judicial Exception of managing risk policy, but does not invalidate the claims’ active recitation of management of risk policy. As such, the argument is not persuasive.
Regarding the applicant’s argument that the amended claims integrate the Judicial Exception into practical application, the examiner respectively disagrees. Invoking generically recited systems, in place of entity, perform the Judicial Exception step of sending message to instruct the other entity to communicate with a regulatory entity to report information about the plurality of risk assessments is fundamentally different from Example 45’s physical transformation of injection molding apparatus. As such, the argument is not persuasive.
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 CHO KWONG whose telephone number is (571)270-7955. The examiner can normally be reached 9am - 5pm EST M-F.
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/CHO YIU KWONG/Primary Examiner, Art Unit 3693