DETAILED ACTION
Status of the Claims
This office action is submitted in response to the RCE filed on 3/2/26.
Examiner notes that this application is a continuation of 16/938806, which is now abandoned.
Examiner further notes that 16/983806 is a continuation of 14/751336, which is now US Patent No. 10810610.
Examiner further notes Applicant’s priority date of 6/26/15, which stems from the aforementioned parent applications.
Examiner further notes the previous withdrawal of prior art on 8/13/25.
Claims 1-20 were previously cancelled.
Claims 21, 28, and 35 have been amended.
Therefore, claims 21-40 are currently pending and have been examined.
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 21-40 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.
Under Step 1 of the subject matter eligibility analysis, claim 21 falls within the statutory category of a machine. Claim 28 falls within the statutory category of a process. Claim 35 falls within the statutory category of an article of manufacture. See MPEP 2106.03. Therefore, the claims satisfy Step 1, and the analysis proceeds to Step 2.
Independent claims 21, 28, and 35, in part, describe a method comprising: generating a ledger entry for a user that includes a user identifier, a ledger identifier, and a qualified source identifier; linking a payment identifier to the user identifier; linking a rule associated with the qualified source of the electronic transaction to the ledger identifier; determining that a payment vehicle identified in a purchase authorization request is linked to the ledger identifier; determining that the authorization request is from the qualified source based on the qualified source identifier; determining that the authorization request satisfies the rule by evaluating whether the user is within a segment definition corresponding to one or more stored benefits, wherein the segment definition is based on historical purchase variables — including a number of purchases within a time period, an average spend, or an average time between purchases — tracked over time in the ledger entry; and generating an augmented authorization request based on the determining and transmitting it to a payment network. As such, the invention is directed to the abstract idea of authorizing purchase transactions and applying qualifying discounts based on customer purchase history segmentation, which, pursuant to MPEP 2106.04(a), is aptly categorized as a method of organizing human activity (i.e., sales and commercial reward activities). Therefore, under Step 2A, Prong One, the claims recite a judicial exception.
Next, the aforementioned claims recite additional elements that are associated with the judicial exception, including: receiving an authorization request for a transaction; and transmitting an augmented authorization request to a payment network. Dependent claims 26, 33, and 40 further disclose transmitting messages to a POS system. Examiner understands these limitations to be insignificant extrasolution activity. See Accenture, 728 F.3d 1336, 108 U.S.P.Q.2d 1173 (Fed. Cir. 2013), citing Cf. Diamond v. Diehr, 450 U.S. 175, 191–192 (1981) ("[I]nsignificant post-solution activity will not transform an unpatentable principle into a patentable process.").
The aforementioned claims also recite additional elements including "one or more processors" for executing the method; a "ledger" for recording data; a "database" for storing ledger entries; a "memory" for storing executable instructions; and a "payment network" for transmitting data. Dependent claims 22, 29, and 36 further describe a "POS system" for executing electronic transactions. These limitations are recited at a high level of generality and appear to be nothing more than generic computer components. Claims that amount to nothing more than an instruction to apply the abstract idea using a generic computer do not render an abstract idea eligible. Alice Corp., 134 S. Ct. at 2358, 110 USPQ2d at 1983. See also 134 S. Ct. at 2389, 110 USPQ2d at 1984.
Furthermore, looking at the elements individually and in combination, under Step 2A, Prong Two, the claims as a whole do not integrate the judicial exception into a practical application because they fail to: improve the functioning of a computer or a technical field, apply the judicial exception in the treatment or prophylaxis of a disease, apply the judicial exception with a particular machine, effect a transformation or reduction of a particular article to a different state or thing, or apply the judicial exception beyond generally linking the use of the judicial exception to a particular technological environment. Rather, the claims merely use a computer as a tool to perform the abstract idea(s), and/or add insignificant extra-solution activity to the judicial exception, and/or generally link the use of the judicial exception to a particular technological environment (e.g., a payment network or POS system).
Next, under Step 2B, the claims do not include additional elements that are sufficient to amount to significantly more than the judicial exception because the additional elements, when considered both individually and as an ordered combination, do not amount to significantly more than the abstract idea. Furthermore, looking at the limitations as an ordered combination adds nothing that is not already present when looking at the elements taken individually. Simply put, as noted above, there is no indication that the combination of elements improves the functioning of a computer (or any other technology), and their collective functions are merely facilitated by generic computer implementation.
Additionally, pursuant to the requirement under Berkheimer, the following citations are provided to demonstrate that the additional elements, identified as extra-solution activity, amount to activities that are well-understood, routine, and conventional. See MPEP 2106.05(d).
Receiving or transmitting data over a network, e.g., using the Internet to gather data, Symantec, 838 F.3d at 1321, 120 USPQ2d at 1362; OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1363, 115 USPQ2d 1090, 1093 (Fed. Cir. 2015) (sending messages over a network); buySAFE, Inc. v. Google, Inc., 765 F.3d 1350, 1355, 112 USPQ2d 1093, 1096 (Fed. Cir. 2014) (computer receives and sends information over a network).
Thus, taken alone and in combination, the additional elements do not amount to significantly more than the above-identified judicial exception (the abstract idea), and are ineligible under 35 U.S.C. 101.
Claims 22-27, 29-34, and 36-40 are dependent on the aforementioned independent claims and include all the limitations contained therein. These claims do not recite any additional technical elements, and simply disclose additional limitations that further limit the abstract idea with details regarding the payment transaction, the transaction rule, or the POS system. Specifically, claims 22, 29, and 36 disclose that the payment transaction is received from a POS system; claims 23, 30, and 37 further specify that the payment transaction is a card-not-present transaction originated at a website — both of which merely identify a conventional transactional environment and add no technical distinction. Claims 24, 25, 31, 32, 38, and 39 disclose that the augmented authorization request reduces the transaction amount by a particular amount or percentage — a purely mathematical operation that further limits the abstract idea with additional abstract subject matter rather than transforming it. Claims 26, 33, and 40 disclose transmitting additional messaging to a POS system to resolve a discrepancy, which, as noted above, constitutes insignificant extrasolution activity. Claims 27 and 34 disclose that the rule relates to an amount, location, type, or number of electronic transactions — additional organizational criteria that further characterize the abstract idea of applying transaction rules without providing any meaningful technical limitation. Thus, the dependent claims merely provide additional non-structural (and predominantly non-functional) details that fail to meaningfully limit the claims or the abstract idea(s).
Therefore, claims 21-40 are not drawn to eligible subject matter, as they are directed to an abstract idea without significantly more.
Relevant Prior Art
The following references are deemed to be relevant to Applicant’s disclosures:
Linden et al. (20150106263), directed to a method for dynamically processing card payment authorization requests.
Badger et al. (20200357015), directed to a method for electronic transaction authorizations based on consumer device activity.
Olson et al. (12373858), directed to a method for loyalty points payment using distributed ledgers.
Badger (10810610), directed to a method for consumer loyalty management.
Response to Arguments
Applicant’s arguments regarding the sufficiency of the claims under 35 USC 101 are unpersuasive.
First, Applicant argues that the amended claims do not recite a judicial exception because the claimed invention reflects a technical solution to integrating consumer-specific historical behavior into authorization request processing and cannot be performed in the human mind. Examiner respectfully disagrees. The judicial exception identified herein is not limited to mental processes — the claims are directed to a method of organizing human activity, specifically the management and execution of commercial sales transactions and loyalty-based discount programs. See MPEP 2106.04(a)(2). The amendment's addition of the segment definition and historical purchase variables does not alter this characterization. Evaluating whether a user qualifies for a benefit by comparing tracked purchase metrics — such as purchase frequency, average spend, and average time between purchases — against a predefined segment definition is itself a mathematical concept and a fundamental economic practice of customer segmentation and loyalty program management. Such analysis can be — and has long been — performed by humans without the aid of a computer. The mere fact that the claims require a processor to perform this evaluation automatically does not transform the abstract idea into patent-eligible subject matter. See Alice Corp., 134 S. Ct. at 2358, 110 USPQ2d at 1983.
Next, Applicant argues that the claims integrate the alleged abstract idea into a practical application by improving the operation of electronic payment networks through the use of ledger-stored historical purchase variables. Examiner is not persuaded. To demonstrate integration into a practical application, a claim must do more than apply an abstract idea using generic computer components in a conventional manner — it must reflect a concrete improvement to the technology itself, not merely an improvement to the abstract idea being implemented. See Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1335–36 (Fed. Cir. 2016). Here, the claims do not improve the payment network infrastructure, the authorization processing architecture, or any underlying computer functionality. The ledger, database, processors, memory, and payment network all perform their routine and conventional functions. The alleged improvement — applying merchant-specific loyalty rules based on historical purchase metrics — is an improvement to the business process of discount application, not to any technology or technical field. Accordingly, the claims do not integrate the judicial exception into a practical application under Step 2A, Prong Two.
Finally, Applicant argues that the additional elements amount to significantly more because the combination of tracking historical purchase variables, evaluating merchant-specific rules, and modifying an authorization request is not well-known and is arranged in a non-conventional manner. Applicant further argues that the absence of a prior art rejection under 35 U.S.C. 103 supports this position. Examiner is not persuaded. The absence of a prior art rejection is not probative of patent eligibility under § 101 — the two analyses are independent inquiries. See Genetic Techs. Ltd. v. Merial L.L.C., 818 F.3d 1369, 1376 (Fed. Cir. 2016). With respect to the Berkheimer requirement, Examiner has provided citations establishing that receiving and transmitting data over a network are well-understood, routine, and conventional activities. See Symantec, 838 F.3d at 1321; OIP Techs., 788 F.3d at 1363; buySAFE, 765 F.3d at 1355. The remaining additional elements — one or more processors, memory, a database, a ledger, and a payment network — are recited at a high level of generality and are each well-understood, routine, and conventional components of electronic payment systems, as is their combination for processing authorization requests. See Alice Corp., 134 S. Ct. at 2358. Applicant has not identified any specific unconventional arrangement of these elements, and none is apparent from the claims.
Accordingly, for at least these reasons, the rejection under 35 U.S.C. 101 is maintained.
Conclusion
Any inquiry concerning this communication or earlier communications from the examiner should be directed to CHRISTOPHER BUSCH whose telephone number is (571)270-7953. The examiner can normally be reached M-F 10-7.
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/CHRISTOPHER C BUSCH/Examiner, Art Unit 3621
/WASEEM ASHRAF/Supervisory Patent Examiner, Art Unit 3621