DETAILED ACTION
Acknowledgements
The amendment filed on 03/30/2026 is acknowledged.
Claims 1-20 are pending.
Claims 1-20 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 .
Response to Amendment/Arguments
Claims 1, 8 and 15 are amended.
Regarding applicant’s arguments on Claim Rejections - 35 U.S.C. §101, the arguments have been fully considered but they are not persuasive.
It is the applicant’s position that “the claims are not directed to a fundamental economic practice or organizing human activity.” because “Such operations are not capable of being performed as a mental process and are not analogous to organizing human activity; they require the use of a processing device operating within a distributed network environment.”. The examiner respectfully disagrees.
The claim(s) recite(s) financial transaction. Specifically, the claims recite “receiving a first ..., on a ..., requesting a first cryptocurrency transfer from a first account to a second account, the first ..., when executed, ensures transferring a first determined value of cryptocurrency to the second account on fulfillment of a first set of conditions; ... generating a second ..., the second ...including the amount determining algorithm related to a time varying cryptocurrency transfer from the second account to a third account on fulfillment of a second set of conditions, wherein generating the second ... comprises: extracting one or more execution parameters from the first ..., including at least one of a product identifier, a maximum amount value, or the amount determining algorithm, and embedding the one or more execution parameters into the second ...; transmitting the second ... to the ...; executing the second ... to produce execution data based on the embedded one or more execution parameters; and fulfilling the first set of conditions based on completion of the second ..., thereby completing the first ....”, which is “commercial or legal interactions” within the “certain methods of organizing human activity” grouping of abstract ideas in prong one of step 2A of the Alice/Mayo test (See MPEP 2106) because the claims involve a series of steps for financial transaction. Accordingly, the claims recite an abstract idea.
Additionally, the claims recite “implementing an amount determining algorithm;” which is the abstract idea of a mathematical concept. See MPEP 2106. Therefore, the claims recite an abstract idea, as it has been held that a combination of abstract ideas, in this case certain methods of organizing human activity and a mathematical concept, is still an abstract idea. See FairWarning IP, LLC v. Iatric Sys., Inc., 839 F.3d 1089, 1093-94 (Fed. Cir. 2016).
This judicial exception is not integrated into a practical application because, when analyzed under prong two of step 2A of the Alice/Mayo test (See MPEP 2106), the additional element(s) of the claim(s) such as the use of smart contract, distributed network, memory, processing device merely use(s) a computer as a tool to perform an abstract idea. The processors and memories are recited at a high-level of generality (i.e., as a generic processor performing a generic computer function of processing financial payment upon conditions met) such that it amounts no more than mere instructions to apply the exception using a generic computer components. Accordingly, the additional elements do not impose any meaningful limits on practicing the abstract idea, and the claims are directed to an abstract idea.
As analyzed above, the claims are directed to providing financial incentive to users based on rules prescribed in the contracts. This is “commercial or legal interactions” within the “certain methods of organizing human activity” grouping of abstract ideas in prong one of step 2A of the Alice/Mayo test (See MPEP 2106). The additional elements such as smart contract, distributed network, memory, processing device are applied in performing the abstract idea. However, the additional elements do not improve the functioning of a computer, or to any other technology or technical field (such as distributed ledger). Accordingly, the judicial exception is not integrated into a practical application.
Additionally, the applicant argues that “the claims further recite significantly more than any alleged abstract idea.” because the claim “defines a non-conventional arrangement of elements that is not merely the use of generic computer components performing routine functions.”. The examiner respectfully disagrees.
The additional elements of using smart contract, distributed network, memory, processing device to perform the steps amounts to no more than using a computer or processor to automate and/or implement the abstract idea of financial transaction. “receiving a first smart contract, on a distributed network, requesting a first cryptocurrency transfer from a first account to a second account, the first smart contract, when executed, ensures transferring a first determined value of cryptocurrency to the second account on fulfillment of a first set of conditions; implementing an amount determining algorithm; generating a second smart contract, the second smart contract including the amount determining algorithm related to a time varying cryptocurrency transfer from the second account to a third account on fulfillment of a second set of conditions, wherein generating the second smart contract comprises: extracting one or more execution parameters from the first smart contract, including at least one of a product identifier, a maximum amount value, or the amount determining algorithm, and embedding the one or more execution parameters into the second smart contract; transmitting the second smart contract to the distributed network; executing the second smart contract to produce execution data based on the embedded one or more execution parameters; and fulfilling the first set of conditions based on completion of the second smart contract, thereby completing the first smart contract”. These functions correspond to the actions required to perform the abstract idea. Viewed as a whole, the combination of elements recited in the claims merely recite the concept of financial transaction. Therefore, the use of these additional elements does no more than employ the computer as a tool to automate and/or implement the abstract idea. The use of a computer or processor to merely automate and/or implement the abstract idea cannot provide significantly more than the abstract idea itself (MPEP 2106.05 (f) & (h)).
Regarding applicant’s arguments on Claim Rejections - 35 U.S.C. §103, the arguments have been fully considered. However, the examiner respectfully disagrees.
It is the Applicant’s position that the cited prior arts Baker in view of Wuehler et al. do not teach following limitations of claims 1, 8 and 15. The examiner respectfully disagrees.
upon completion of the second smart contract, fulfill the first set of conditions, thereby completing the first smart contract.
generate a second smart contract, the second smart contract including the amount determining algorithm... wherein generating the second smart contract comprises: extracting one or more execution parameters from the first smart contract... and embedding the one or more execution parameters into the second smart contract.
cute the second smart contract to produce execution data based on the embedded one or more execution parameters.
first smart contract.. requesting a first cryptocurrency transfer. on fulfillment of a first set of conditions,
With respect to “(1) upon completion of the second smart contract, fulfill the first set of conditions, thereby completing the first smart contract.,” Baker Fig. 3 steps 318 and 328 illustrates the second smart contract is complete and fulling the first set of conditions. Baker ¶0050 discloses “The Incentee device may send the exercise record to the incenting computer system at 316” and ¶0055 discloses “the exercise record may be verification that the incentee user has performed the prescribed exercises expressed in the arrangement. The incenting computer system may, upon validation of the exercise record, verify whether the exercise record indicates that the Incentee user has performed the prescribed exercise record at 328... If the exercise record verifies that the prescribed physical exercise or exercise level has been performed by the incentee user, the incentee device may receive notice of exercise verification at 326 and the incentor device may receive notice of exercise verification at 328.” Fig. 4 steps 412 and 414 illustrates completing the first smart contract. ¶0058 discloses “The incenting computer system sends the notice at 410. The incentor user may then transfer money to the incentee at 412. The incentee user may receive the money at 414.” Therefore, Baker teaches the limitation.
With respect to “(2) generate a second smart contract, the second smart contract including the amount determining algorithm... wherein generating the second smart contract comprises: extracting one or more execution parameters from the first smart contract... and embedding the one or more execution parameters into the second smart contract.” Baker ¶0043 discloses “The incentor device may send an electronic request to begin a proposed incenting arrangement to the incenting computer system at 210. The proposed incentive arrangement may include an identity of the incentee user, an identity of the incentee device, a proposed reward and/ or a prescribed physical exercise or exercise level to be performed by the Incentee user in exchange for the proposed reward, as well as other details.”, and ¶0048 discloses “The incenting computer system may forward the request to the incentee device at 212. The forwarded request may include, in embodiments, the prescribed exercise or level of exercise, the proposed reward for performing the exercise or exercise level, an identity of the incentor user, Incentee user, and/or other information. If the incentee user chooses to accept the arrangement, the incentee device may forward an agreement to enter into the proposed arrangement at 214.”. Therefore, Baker teaches the limitation.
With respect to “(3) execute the second smart contract to produce execution data based on the embedded one or more execution parameters.” Baker Fig. 3 steps 312, 314, 316 and 318 illustrates that the second smart contract is executed. Baker ¶0050 discloses “The Incentee device may send the exercise record to the incenting computer system at 316” and ¶0055 discloses “the exercise record may be verification that the incentee user has performed the prescribed exercises expressed in the arrangement. The incenting computer system may, upon validation of the exercise record, verify whether the exercise record indicates that the Incentee user has performed the prescribed exercise record at 328... If the exercise record verifies that the prescribed physical exercise or exercise level has been performed by the incentee user, the incentee device may receive notice of exercise verification at 326 and the incentor device may receive notice of exercise verification at 328.... the validated exercise record alone may be sufficient to verify that the incentee user has performed the prescribed exercise or exercise level.” Therefore, Baker teaches the limitation.
With respect to “(4) first smart contract.. requesting a first cryptocurrency transfer. on fulfillment of a first set of conditions,” Fig. 4 steps 412 and 414 illustrates completing the first smart contract. ¶0058 discloses “The incenting computer system sends the notice at 410. The incentor user may then transfer money to the incentee at 412. The incentee user may receive the money at 414.” Baker does not explicitly disclose cryptocurrency, however, Wuehler et al. ¶0073 discloses cryptocurrency. Therefore, Baker in view of Wuehler teaches the limitation.
Regarding applicant’s arguments on nonstatutory Double Patenting Rejection, the arguments have been fully considered. However, the examiner respectfully disagrees.
It is the applicant’s position that “The Office Action does not identify, in the cited patent, any disclosure of these limitations or any equivalent structure.” The examiner respectfully disagrees.
A table with claim by claim, limitation by limitation comparison is documented in pages 8-18 of this Office Action. Please refer to this table for detail.
Double Patenting
The nonstatutory double patenting rejection is based on a judicially created doctrine grounded in public policy (a policy reflected in the statute) so as to prevent the unjustified or improper timewise extension of the “right to exclude” granted by a patent and to prevent possible harassment by multiple assignees. A nonstatutory double patenting rejection is appropriate where the conflicting claims are not identical, but at least one examined application claim is not patentably distinct from the reference claim(s) because the examined application claim is either anticipated by, or would have been obvious over, the reference claim(s). See, e.g., In re Berg, 140 F.3d 1428, 46 USPQ2d 1226 (Fed. Cir. 1998); In re Goodman, 11 F.3d 1046, 29 USPQ2d 2010 (Fed. Cir. 1993); In re Longi, 759 F.2d 887, 225 USPQ 645 (Fed. Cir. 1985); In re Van Ornum, 686 F.2d 937, 214 USPQ 761 (CCPA 1982); In re Vogel, 422 F.2d 438, 164 USPQ 619 (CCPA 1970); In re Thorington, 418 F.2d 528, 163 USPQ 644 (CCPA 1969).
A timely filed terminal disclaimer in compliance with 37 CFR 1.321(c) or 1.321(d) may be used to overcome an actual or provisional rejection based on nonstatutory double patenting provided the reference application or patent either is shown to be commonly owned with the examined application, or claims an invention made as a result of activities undertaken within the scope of a joint research agreement. See MPEP § 717.02 for applications subject to examination under the first inventor to file provisions of the AIA as explained in MPEP § 2159. See MPEP §§ 706.02(l)(1) - 706.02(l)(3) for applications not subject to examination under the first inventor to file provisions of the AIA . A terminal disclaimer must be signed in compliance with 37 CFR 1.321(b).
The USPTO Internet website contains terminal disclaimer forms which may be used. Please visit www.uspto.gov/patent/patents-forms. The filing date of the application in which the form is filed determines what form (e.g., PTO/SB/25, PTO/SB/26, PTO/AIA /25, or PTO/AIA /26) should be used. A web-based eTerminal Disclaimer may be filled out completely online using web-screens. An eTerminal Disclaimer that meets all requirements is auto-processed and approved immediately upon submission. For more information about eTerminal Disclaimers, refer to www.uspto.gov/patents/process/file/efs/guidance/eTD-info-I.jsp.
Claims 1-20 are rejected on the ground of nonstatutory double patenting as being unpatentable over claims 1-20 of U.S. Patent No. 12,154,081. Although the claims at issue are not identical, they are not patentably distinct from each other.
18/927,031
U.S. Patent No. 12,154,081
1. A system comprising:
a memory device;
a processing device coupled to the memory device configured to:
receive a first smart contract, on a distributed network, requesting a first cryptocurrency transfer from a first account to a second account, the first smart contract, when executed, ensures transferring a first determined value of cryptocurrency to the second account on fulfillment of a first set of conditions;
implement an amount determining algorithm;
generate a second smart contract, the second smart contract including the amount determining algorithm to implement a time varying cryptocurrency transfer from the second account to a third account on fulfillment of a second set of conditions, wherein generating the second smart contract comprises;
extracting one or more execution parameters from the first smart contract, including at least one of a product identifier, a maximum amount value, or the amount determining algorithm, and
embedding the one or more execution parameters into the second smart contract;
transmit the second smart contract to the distributed network; and
execute the second smart contract to produce execution data based on the embedded one or more execution parameters; and
based on completion of the second smart contract, fulfill the first set of conditions, thereby
completing the first smart contract.
1. A blockchain technology based system, comprising: at least one computer, in a decentralized network, comprising a processor and a non-transitory computer memory, wherein the non-transitory computer memory storing instructions that, when executed by the processor, cause the processor to perform:
receiving a first set of self-executing computer instructions, wherein the first set of self-executing computer instructions executes upon a fulfillment of a first set of conditions;
receiving a first set of data associated with the first set of self-executing computer instructions;
generating a second set of self-executing computer instructions based on the first set of data, wherein the second set of self-executing computer instructions executes upon a fulfillment of a second set of conditions, and wherein the execution of the second set of self-executing computer instructions fulfills the first set of conditions;
transmitting the second set of self-executing computer instructions and the second set of conditions to the decentralized network;
executing the second set of self-executing computer instructions;
in response to executing the second set of self-executing computer instructions, transferring cryptocurrency from a second account to a third account and determining the first set of conditions;
executing the first set of self-executing computer instructions based on determined first set of conditions; and
in response to executing the first set of self-executing computer instructions, transferring the cryptocurrency from a first account to the second account.
2. The system of claim 1, wherein the completion of the second smart contract includes performing a time varying cryptocurrency transfer from the second account to the third account for an amount determined by the amount determining algorithm.
3. The system of claim 2, wherein the first set of conditions includes receiving data related to an identity of a user associated with the third account, the time period determined by the amount determining algorithm, and determined value of cryptocurrency transferred to the third account from the second account.
3. The system of claim 1, wherein the amount determining algorithm decrements the cryptocurrency received by the third account based on a time period determined by subtracting the first timestamp value from a second timestamp.
4. The system of claim 3, wherein the first timestamp is a timestamp generated at time the second smart contract is transmitted to the distributed network, and the second timestamp is the timestamp generated at time of completion of the second contract.
2. The system of claim 1, wherein the blockchain technology based second set of self-executing computer instructions includes an amount determining algorithm, wherein the amount determining algorithm determines a second monetary value of cryptocurrency received by the third account, and wherein the second set of self-executing computer instructions includes a first timestamp value, and wherein the amount determining algorithm decrements the second monetary value of cryptocurrency received by the third account based on a time period determined by subtracting the first timestamp value from a
second timestamp value, wherein the first timestamp value is a timestamp generated at time of transmitting the second set of self-executing computer instructions, and wherein the second timestamp value is the timestamp generated by the at least one digital processing device at time of execution of the second set of self-executing computer instructions.
5. The system of claim 1, wherein the time varying cryptocurrency transfer performed by the amount determining algorithm is based on a predetermined set of criteria provided by an authorized user of the first account.
7. The system of claim 2, wherein the second monetary value of cryptocurrency determined by the amount determining algorithm is based on a predetermined set of criteria provided by an authorized user of the first account.
6. The system of claim 1, wherein an authorized user of the second account is aware of the identifying information for an authorized user of the third account before generating the second smart contract.
5. The system of claim 1, wherein identifying information of an authorized user of the third account is known to an authorized user of the second account prior to generation of the second set of self-executing computer instructions.
7. The system of claim 1, wherein an authorized user of the first account is not aware of an authorized user of the third account until the first smart contract is executed.
4. The system of claim 1, wherein identifying information of an authorized user of the third account is not known to an authorized user of the first account until completion of the first set of self-executing computer instructions by the at least one digital processing device.
8. A method comprising:
receiving a first smart contract, on a distributed network, requesting a first cryptocurrency transfer from a first account to a second account, the first smart contract, when executed, ensures transferring a first determined value of cryptocurrency to the second account on fulfillment of a first set of conditions, wherein generating the second smart contract comprises:
extracting one or more execution parameters from the first smart contract, including at least one of a product identifier, a maximum amount value, or the amount determining algorithm, and
embedding the one or more execution parameters into the second smart contract;
implementing an amount determining algorithm;
generating a second smart contract, the second smart contract including the amount determining algorithm related to a time varying cryptocurrency transfer from the second account to a third account on fulfillment of a second set of conditions;
transmitting the second smart contract to the distributed network; and
executing the second smart contract to produce execution data based on the embedded one or more execution parameters; and
fulfilling the first set of conditions based on completion of the second smart contract, thereby completing the first smart contract.
8. A blockchain technology based method comprising:
receiving, at a network interface of a processing system in a decentralized network, a first set of self-executing computer instructions, wherein the first set of self-executing computer instructions executes upon a fulfillment of a first set of conditions;
receiving, by the processing system, a first set of data associated with the first set of self-executing computer instructions;
generating, by the processing system, a second set of self-executing computer instructions based on the first set of data, wherein the second set of self-executing computer instructions executes upon a fulfillment of a second set of conditions, and wherein the execution of the second set of self-executing computer instructions fulfills the first set of conditions;
transmitting, by the processing system, the second set of self-executing computer instructions and the second set of conditions to the decentralized network;
executing the second set of self-executing computer instructions;
in response to executing the second set of self-executing computer instructions, transferring cryptocurrency from a second account to a third account and determining the first set of conditions;
executing the first set of self-executing computer instructions based on determined first set of conditions; and
in response to executing the first set of self-executing computer instructions, transferring the cryptocurrency from a first account to the second account.
9. The method of claim 8, wherein the completion of the second smart contract includes performing a time varying cryptocurrency transfer from the second account to the third account for an amount determined by the amount determining algorithm.
10. The method of claim 9, wherein the first set of conditions includes receiving data related to an identity of a user associated with the third account, the time period determined by the amount determining algorithm, and determined value of cryptocurrency transferred to the third account from the second account.
10. The method of claim 8, wherein the amount determining algorithm decrements the cryptocurrency received by the third account based on a time period determined by subtracting the first timestamp value from a second timestamp.
11. The method of claim 10, wherein the first timestamp is a timestamp generated at time the second smart contract is transmitted to the distributed network, and the second timestamp is the timestamp generated at time of completion of the second contract.
9. The method of claim 8, wherein the second set of self-executing computer instructions further includes an amount determining algorithm, wherein the amount determining algorithm determines a second monetary value of cryptocurrency received by the third account, and wherein the second set of self-executing computer instructions includes a first timestamp value, and wherein the amount determining algorithm decrements the second monetary value of cryptocurrency received by the third account based on a time period determined by subtracting the first timestamp value from a second
timestamp value, wherein the first timestamp value is a timestamp generated at time of transmitting the second set of self-executing computer instructions, and wherein the second timestamp value is the timestamp generated by the at least one digital processing device at time of execution of the second set of self-executing computer instructions.
13. The method of claim 8, wherein an authorized user of the second account is aware of the identifying information for an authorized user of the third account before generating the second smart contract.
12. The method of claim 8, wherein identifying information of an authorized user of the third account is known to an authorized user of the second account prior to generation of the second set of self-executing computer instructions.
14. The method of claim 8, wherein an authorized user of the first account is not aware of an authorized user of the third account until the first smart contract is executed.
11. The method of claim 8, wherein identifying information of an authorized user of the third account is not known to an authorized user of the first account until completion of the first set of self-executing computer instructions by the at least one digital processing device.
15. A non-transitory computer readable medium comprising instructions which when
executed by a processing device executes a method comprising:
receiving a first smart contract, on a distributed network, requesting a first cryptocurrency transfer from a first account to a second account, the first smart contract, when executed, ensures transferring a first determined value of cryptocurrency to the second account on fulfillment of a first set of conditions;
implementing an amount determining algorithm;
generating a second smart contract, the second smart contract including the amount determining algorithm related to a time varying cryptocurrency transfer from the second account to a third account on fulfillment of a second set of conditions, wherein generating the second smart contract comprises:
extracting one or more execution parameters from the first smart contract, including at least one of a product identifier, a maximum amount value, or the amount determining algorithm, and
embedding the one or more execution parameters into the second smart contract;
transmitting the second smart contract to the distributed network; and
execute the second smart contract to produce execution data based on the embedded one or more execution parameters; and
fulfilling the first set of conditions based on completion of the second smart contract, thereby completing the first smart contract.
14. A non-transitory computer-readable storage medium comprising instructions which when executed by a processing system in a distributed network comprising at least one hardware core performs a blockchain technology based method comprising:
receiving a first set of self-executing computer instructions, wherein the first set of self-executing computer instructions executes upon a fulfillment of a first set of conditions;
receiving a first set of data associated with the first set of self-executing computer instructions;
generating a second set of self-executing computer instructions based on the first set of data, wherein the second set of self-executing computer instructions executes upon a fulfillment of a second set of conditions and wherein the execution of the second set of self-executing computer instructions fulfills the first set of conditions;
transmitting the second set of self-executing computer instructions and the second set of conditions to the decentralized network;
executing the second set of self-executing computer instructions;
in response to executing the second set of self-executing computer instructions, transferring cryptocurrency from a second account to a third account and determining the first set of conditions;
executing the first set of self-executing computer instructions based on determined first set of conditions; and
in response to executing the first set of self-executing computer instructions, transferring the cryptocurrency from a first account to the second account.
16. The non-transitory computer readable medium of claim 15, wherein the completion of the second smart contract includes performing a time varying cryptocurrency transfer from the second account to the third account for an amount determined by the amount determining algorithm.
16. The non-transitory computer-readable storage medium of claim 15, wherein the first set of conditions includes receiving data related to an identity of a user associated with the third account, the time period determined by the amount determining algorithm, and determined value of cryptocurrency transferred to the third account from the second account.
17. The non-transitory computer readable medium of claim 15, wherein the amount determining algorithm decrements the cryptocurrency received by the third account based on a time period determined by subtracting the first timestamp value from a second timestamp.
18. The non-transitory computer readable medium of claim 17, wherein the first timestamp is a timestamp generated at time the second smart contract is transmitted to the distributed network, and the second timestamp is the timestamp generated at time of completion of the second contract.
15. The non-transitory computer-readable storage medium of claim 14, wherein the second set of self-executing computer instructions further includes an amount determining algorithm that, wherein the amount determining algorithm determines a second monetary value of cryptocurrency received by the third account, and wherein the second set of self-executing computer instructions includes a first timestamp value, and wherein the amount determining algorithm decrements the second monetary value of cryptocurrency received by the third account based on a time period determined by subtracting the first timestamp value from a second
timestamp value, wherein the first timestamp value is a timestamp generated at time of transmitting the second set of self-executing computer instructions, and wherein the second timestamp value is the timestamp generated by the at least one digital processing device at time of execution of the second set of self-executing computer instructions.
19. The non-transitory computer readable medium of claim 15, wherein the time varying cryptocurrency transfer performed by the amount determining algorithm is based on a predetermined set of criteria provided by an authorized user of the first account.
20. The non-transitory computer-readable storage medium of claim 15, wherein the second monetary value of cryptocurrency determined by the amount determining algorithm is based on a predetermined set of criteria provided by an authorized user of the first account.
20. The non-transitory computer readable medium of claim 15, wherein an authorized user of the second account is aware of the identifying information for an authorized user of the third account before generating the second smart
contract, and wherein an authorized user of the first account is not aware of an authorized user of the third account until the first smart contract is executed.
18. The non-transitory computer-readable storage medium of claim 14, wherein identifying information of an authorized user of the third account is known to an authorized user of the second account prior to generation of the second set of self-executing computer instructions.
17. The non-transitory computer-readable storage medium of claim 14, wherein identifying information of an authorized user of the third account is not known to an authorized user of the first account until completion of the first set of self-executing computer instructions by the at least one digital processing device.
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 an abstract idea without significantly more.
Analysis
In the instant case, claims 8-14 are directed to a method, claims 1-7 and 15-20 are directed to a system and apparatus. Therefore, these claims fall within the four statutory categories of invention.
The claim(s) recite(s) financial transaction. Specifically, the claims recite “receiving a first ..., on a ..., requesting a first cryptocurrency transfer from a first account to a second account, the first ..., when executed, ensures transferring a first determined value of cryptocurrency to the second account on fulfillment of a first set of conditions; ... generating a second ..., the second ...including the amount determining algorithm related to a time varying cryptocurrency transfer from the second account to a third account on fulfillment of a second set of conditions, wherein generating the second ... comprises: extracting one or more execution parameters from the first ..., including at least one of a product identifier, a maximum amount value, or the amount determining algorithm, and embedding the one or more execution parameters into the second ...; transmitting the second ... to the ...; executing the second ... to produce execution data based on the embedded one or more execution parameters; and fulfilling the first set of conditions based on completion of the second ..., thereby completing the first ....”, which is “commercial or legal interactions” within the “certain methods of organizing human activity” grouping of abstract ideas in prong one of step 2A of the Alice/Mayo test (See MPEP 2106) because the claims involve a series of steps for financial transaction. Accordingly, the claims recite an abstract idea.
Additionally, the claims recite “implementing an amount determining algorithm;” which is the abstract idea of a mathematical concept. See MPEP 2106. Therefore, the claims recite an abstract idea, as it has been held that a combination of abstract ideas, in this case certain methods of organizing human activity and a mathematical concept, is still an abstract idea. See FairWarning IP, LLC v. Iatric Sys., Inc., 839 F.3d 1089, 1093-94 (Fed. Cir. 2016).
This judicial exception is not integrated into a practical application because, when analyzed under prong two of step 2A of the Alice/Mayo test (See MPEP 2106), the additional element(s) of the claim(s) such as the use of smart contract, distributed network, memory, processing device merely use(s) a computer as a tool to perform an abstract idea. The processors and memories are recited at a high-level of generality (i.e., as a generic processor performing a generic computer function of processing financial payment upon conditions met) such that it amounts no more than mere instructions to apply the exception using a generic computer components. Accordingly, the additional elements do not impose any meaningful limits on practicing the abstract idea, and the claims are directed to an abstract idea.
The claims do not include additional elements that are sufficient to amount to significantly more than the judicial exception. As discussed above with respect to integration of the abstract idea into a practical application, the additional element of using smart contract, distributed network, memory, processing device to perform financial transaction steps amounts to no more than mere instructions to apply the exception using a generic computer components. Mere instructions to apply an exception using a generic computer components cannot provide an inventive concept. The claim is not patent eligible.
Dependent claims 2, 9 and 16 describe second smart contract. Dependent claims 3, 10 and 17 describe amount determining algorithm. Dependent claims 4, 11 and 18 describe first timestamp. Dependent claims 5, 12 and 19 describe time varying cryptocurrency transfer. Dependent claims 6-7, 13-14 and 20 describe user. These claims further recite the abstract idea of certain methods of organizing human activity and a mathematical concept. This judicial exception is not integrated into a practical application because the additional element(s) of the claim(s) such as the use of smart contract, distributed network, memory, processing device merely use(s) a computer as a tool to perform an abstract idea. The claims do not include additional elements that are sufficient to amount to significantly more than the judicial exception. The claims are not patent eligible.
Viewed as a whole, the combination of elements recited in the claims simply recite the concept of financial transaction. The claims do not, for example, purport to improve the functioning of the computer itself. Nor do they effect an improvement in any other technology or technical field.
The use of a smart contract, distributed network, memory, processing device as tools to implement the abstract idea does not render the claim patent eligible because it does not provide meaningful limitations beyond generally linking the use of an abstract idea to a particular technological environment and requires no more than a computer performing functions that correspond to acts required to carry out the abstract idea.
Claim Rejections - 35 USC § 103
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.
Claims 1-20 are rejected under 35 U.S.C. 103 as being unpatentable over US Application Publication US20080147502A1 (“Baker”) in view of US Application Publication US20170140408A1 (“Wuehler et al.”).
Regarding claims 1, 8 and 15, Baker discloses:
a memory device; (Fig. 9)
a processing device coupled to the memory device configured to:(Fig. 9)
receive a first agreement, on a network, requesting a first reward transfer from a first account to a second account, the first agreement, when executed, ensures transferring a first determined value of reward to the second account on fulfillment of a first set of conditions; (Figs. 2 and 5; ¶¶0043-48, ¶0059 and ¶¶0062-0063; claim 3)
implement an amount determining algorithm; (¶¶0047-48 and ¶0063)
generate a second agreement, the second agreement including the amount determining algorithm to implement a time varying reward transfer from the second account to a third account on fulfillment of a second set of conditions; (Figs. 2 and 5; ¶0022, ¶0026, ¶0043, ¶¶0047-48, ¶0051, ¶0054, ¶0059 and ¶0063; claim 3) , wherein generating the second agreement comprises:
extracting one or more execution parameters from the first agreement, including at least one of a product identifier, a maximum amount value, or the amount determining algorithm, and (¶0043 and ¶0048)
embedding the one or more execution parameters into the second agreement; (¶0043 and ¶0048)
transmit the second agreement to the network; (¶0048 and ¶0062; claim 3)
executing the second agreement to produce execution data based on the embedded one or more execution parameters; and (Fig. 3 steps 318 and 328; ¶0055)
based on completion of the second agreement, fulfill the first set of conditions, thereby completing the first agreement. (Fig. 3 steps 318 and 328, Fig. 4 steps 412 and 414; ¶¶0043-55, ¶0058 and ¶0063)
Baker does not explicitly disclose:
network is decentralized network
wherein the agreement is smart contract;
reward is cryptocurrency
However, Wuehler et al. discloses:
network is decentralized network; (Fig. 6B.; ¶0028)
wherein the agreement is smart contract; (abs, ¶0013)
reward is cryptocurrency; (¶0073)
Therefore, it would have been obvious to one of ordinary skill in the art before the effective filing date of the claimed invention to modify Exercise Incenting Methods and Devices of Baker by utilizing blockchain based smart contract in accordance with the teaching of Wuehler et al.. This modification enables Baker’s system utilizing smart contract to automate the process of establishing and enforcing contract. Hence, Baker’s user can enjoy all the benefits that smart contract has to offer, such as transparency, efficiency, and accuracy. (Wuehler et al. ¶0039, ¶¶0076-78)
Regarding claims 2, 9 and 16, Baker in view of Wuehler et al. discloses all the limitations as described above. Baker further discloses:
wherein the completion of the second smart contract includes performing a time varying cryptocurrency transfer from the second account to the third account for an amount determined by the amount determining algorithm. (¶¶0047-48 and ¶0063)
Regarding claims 3, 10 and 17, Baker in view of Wuehler et al. discloses all the limitations as described above. Baker further discloses:
wherein the amount determining algorithm decrements the cryptocurrency received by the third account based on a time period determined by subtracting the first timestamp value from a second timestamp. (¶¶0047-48 and ¶0063)
Regarding claims 4, 11 and 18, Baker in view of Wuehler et al. discloses all the limitations as described above. Baker further discloses:
wherein the first timestamp is a timestamp generated at time the second smart contract is transmitted to the distributed network, and the second timestamp is the timestamp generated at time of completion of the second contract. (¶¶0047-48 and ¶0063)
Regarding claims 5, 12 and 19, Baker in view of Wuehler et al. discloses all the limitations as described above. Baker further discloses:
wherein the time varying cryptocurrency transfer performed by the amount determining algorithm is based on a predetermined set of criteria provided by an authorized user of the first account. (¶¶0047-48 and ¶0063)
Regarding claims 6 and 13, Baker in view of Wuehler et al. discloses all the limitations as described above. Baker further discloses:
wherein an authorized user of the second account is aware of the identifying information for an authorized user of the third account before generating the second smart contract. (¶0043)
Regarding claims 7 and 14, Baker in view of Wuehler et al. discloses all the limitations as described above. Baker further discloses:
wherein an authorized user of the first account is not aware of an authorized user of the third account until the first smart contract is executed. (¶0043)
Regarding claim 20, Baker in view of Wuehler et al. discloses all the limitations as described above. Baker further discloses:
wherein an authorized user of the second account is aware of the identifying information for an authorized user of the third account before generating the second smart contract, and wherein an authorized user of the first account is not aware of an authorized user of the third account until the first smart contract is executed. (¶0043)
Conclusion
The following prior art made of record and not relied upon is considered pertinent to applicant's disclosure.
US20160342989A1 (“Davis”) discloses a method for authorizing a blockchain-based transaction includes: receiving a transaction request, the request including a network identifier associated with a blockchain network, a transaction amount, and one of: a public key and an address identifier; generating an address identifier using at least the public key included in the received transaction request and one or more hashing algorithms if the received transaction request does not include an address identifier; generating a transaction message, the message including a first data element configured to store a transaction amount and a second data element reserved for private use, and the first data element includes a zero value and the second data element includes at least (i) the network identifier or an encoded value based on the network identifier, (ii) the address identifier, and (iii) the transaction amount; and transmitting the transaction message to a financial institution using a payment network..
US10387878A1(“Johnsrud et al.”) discloses a method and system for using the block chain distributed network for managing transaction history of unbanked and underbanked users in a process data network. The present invention is configured to electronically receive an indication from a computing system associated with a first user that the first user has executed a transfer of resources with a second user; retrieve information associated with the transfer of resources from the first user; retrieve information associated with a block chain of user information associated with the first user; transmit a notification to a computing system associated with the second user to validate the transfer of resources; receive an input from the second user validating the transfer of resources; and update the block chain of user information with the validated transfer of resources based on at least receiving the input from the second user.
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 extension fee 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 YINGYING ZHOU whose telephone number is (571)272-5308. The examiner can normally be reached Mon - Fri 9:00am - 5:00pm ET.
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/YINGYING ZHOU/Primary Examiner, Art Unit 3697
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