DETAILED ACTION
This Final Office Action is in response to the application filed on 01/17/2025 and the Amendment & Remark filed on 06/12/2026.
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 .
Status of Claims
Claim 1 is amended.
Claims 2-20 are added.
Claims 1-20 are pending.
Claim Objections
The previously claim objection is withdrawn in view of the Amendment filed on 06/12/2026.
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 an apparatus and a process, 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:
An electronic exchange platform configured to:
receive a plurality of marketmaking orders for a side of trades for a financial instrument from each of a plurality of sellside participants in a market for the financial instrument;
for each of a plurality of the marketmaking orders of the plurality of moneymaking orders, receive a respective list of approved buyside participants out of a plurality of buyside participants in the market for the financial instrument and assigning a daily randomized customer identification for each of the plurality of buyside participants for spotting and removing an abusing buyside participant;
in response to receiving the plurality of orders, automatically peg a price for each of the marketmaking orders of the plurality of moneymaking orders to a price relative to and multiple ticks behind a best price on the side of trades in an order book for the market that is maintained by the electronic exchange platform;
in response to receiving the plurality of orders, populate a respective interface of each buyside participant of the plurality of buyside participants with market information that includes information about a respective subsets of the plurality of marketmaking orders for which the buyside participant has been identified as an approved buyside participant;
receive, from a buyside participant, a contra order to the plurality of marketmaking orders, in which the buyside participant is approved to trade with a subset of the sellside participants and in which the contra order identifies a preferred sellside participants;
in response to receiving the contra order, distribute the contra order first to orders in the order book according to a priority scheme that distributes liquidity first to orders at the best bid or offer counter to the contra order, second to marketmaking orders from the identified preferred sellside participant, third to a subset of marketmaking orders of the plurality of marketmaking orders that the buyside participant is approved to trade against and whose sellside submitter has an order at the best bid or offer counter to the contra order, and fourth to marketmaking orders that the buyside participant is approved to trade against and whose sellside submitter does not have an order at the best bid or offer counter to the contra order;
determine new best bid and offer prices in the order book in response to the distribution; and
automatically adjust remaining market making orders of the plurality of marketmaking orders to retain a pegged price in response to determining the new best bid or offer.
Claims 2 and 12 recite:
wherein the electronic exchange platform is further configured to apply a price compaction rule by limiting the pegged price to a fractional price increment when the pegged price would otherwise cross the fractional price increment.
Claims 3 and 13 recite:
wherein the price compaction rule defines fractional-pricing boundaries corresponding to at least one of 1/32, 1/16 of 1/32, 1/8 of 1/32, or 1/4 of 1/32 of a percentage point.
Claims 4 and 14 recite:
wherein the price compaction rule includes a configuration setting for each sellside participant and for each financial instrument that specifies, for that participant and instrument, whether compaction is: (a) disabled;(b) limited to a nearest fractional increment; or (c) set to a price better than the nearest fractional increment by a configurable amount.
Claims 5 and 15 recite:
wherein the multiple ticks comprises two ticks.
Claims 6 and 16 recite:
wherein the price compaction rule is configurable on a per-participant, per-order, or per-instrument basis based on compaction information received from a submitting sellside participant.
Claims 7 and 17 recite:
wherein the electronic exchange platform is further configured to:
receive from the first buyside participant a preference indicator identifying a preferred sellside participant; and
apply the preference indicator to override a default distribution determination such that a passive liquidity provision order of the preferred sellside participant is preferentially filled.
Claims 8 and 18 recite:
wherein the preference indicator comprises a promo code identifying a plurality of sellside participants in a defined order of preference.
Claims 9 and 19 recite:
wherein the electronic exchange platform is further configured to:
store a bilateral counterparty approval matrix having cells indicating, for each pair of a sellside participant and a buyside participant, whether the participants have mutually approved one another for trading; and
determine the orders accessible to each buyside participant by traversing the bilateral counterparty approval matrix before populating the respective interface of each buyside participants with market information.
Claims 10 and 20 recite:
wherein the electronic exchange platform is further configured to:
include the randomized customer identifier in post-trade messaging transmitted to the sellside participant counter to the trade; and
remove the buyside participant associated with the randomized customer identifier from one or more approved-counterparty lists of the sellside participant without revealing the identity of the buyside participant to the sellside participant.
Claim 11 recites:
A computer-implemented method performed by an electronic exchange platform, the method comprising:
receive a plurality of marketmaking orders for a side of trades for a financial instrument from each of a plurality of sellside participants in a market for the financial instrument;
for each of a plurality of the marketmaking orders of the plurality of moneymaking orders, receive a respective list of approved buyside participants out of a plurality of buyside participants in the market for the financial instrument and assigning a daily randomized customer identification for each of the plurality of buyside participants for spotting and removing an abusing buyside participant;
in response to receiving the plurality of orders, automatically peg a price for each of the marketmaking orders of the plurality of moneymaking orders to a price relative to and multiple ticks behind a best price on the side of trades in an order book for the market that is maintained by the electronic exchange platform;
in response to receiving the plurality of orders, populate a respective interface of each buyside participant of the plurality of buyside participants with market information that includes information about a respective subsets of the plurality of marketmaking orders for which the buyside participant has been identified as an approved buyside participant;
receive, from a buyside participant, a contra order to the plurality of marketmaking orders, in which the buyside participant is approved to trade with a subset of the sellside participants and in which the contra order identifies a preferred sellside participants;
in response to receiving the contra order, distribute the contra order first to orders in the order book according to a priority scheme that distributes liquidity first to orders at the best bid or offer counter to the contra order, second to marketmaking orders from the identified preferred sellside participant, third to a subset of marketmaking orders of the plurality of marketmaking orders that the buyside participant is approved to trade against and whose sellside submitter has an order at the best bid or offer counter to the contra order, and fourth to marketmaking orders that the buyside participant is approved to trade against and whose sellside submitter does not have an order at the best bid or offer counter to the contra order;
determine new best bid and offer prices in the order book in response to the distribution; and
automatically adjust remaining market making orders of the plurality of marketmaking orders to retain a pegged price in response to determining the new best bid or offer.
Based on the limitations above, the claims describe a process that covers allocating trade orders pegged to a best price. Allocating trade orders manages contractual relationship between market participants, and is considered to be a commercial interaction, which falls within the “Certain Methods of Organizing Human Activity” grouping of abstract ideas. 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 “electronic … platform” 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 “receive a plurality of marketmaking orders for a side of trades for a financial instrument from each of a plurality of sellside participants in a market for the financial instrument” encompasses no more than generically invoking a electronic platform to apply the Judicial Exception step of receiving a plurality of marketmaking orders for a side of trades from each of a plurality of sellside participants;
the limitation “for each of a plurality of the marketmaking orders of the plurality of moneymaking orders, receive a respective list of approved buyside participants out of a plurality of buyside participants in the market for the financial instrument and assigning a daily randomized customer identification for each of the plurality of buyside participants for spotting and removing an abusing buyside participant” encompasses no more than generically invoking a electronic platform to apply the Judicial Exception step of receiving a respective list of approved buyside participants for each of a plurality of the marketmaking orders of the plurality of the marketmaking orders and assigning a daily randomized customer identification for each buyside participants;
the limitation “in response to receiving the plurality of orders, automatically peg a price for each of the marketmaking orders of the plurality of moneymaking orders to a price relative to and multiple ticks behind a best price on the side of trades in an order book for the market that is maintained by the electronic exchange platform” encompasses no more than generically invoking a electronic platform to apply the Judicial Exception step of pegging a price for each of the marketmaking orders to a price relative to and multiple ticks behind a best price on the side of trades in an order book;
the limitation “in response to receiving the plurality of orders, populate a respective interface of each buyside participant of the plurality of buyside participants with market information that includes information about a respective subsets of the plurality of marketmaking orders for which the buyside participant has been identified as an approved buyside participant” encompasses no more than generically invoking a electronic platform to apply the Judicial Exception step of populating market information to each buyside participant of the plurality of buyside participants;
the limitation “receive, from a buyside participant, a contra order to the plurality of marketmaking orders, in which the buyside participant is approved to trade with a subset of the sellside participants and in which the contra order identifies a preferred sellside participants” encompasses no more than generically invoking a electronic platform to apply the Judicial Exception step of receiving a contra order to the plurality of marketmaking orders;
the limitation “in response to receiving the contra order, distribute the contra order first to orders in the order book according to a priority scheme that distributes liquidity first to orders at the best bid or offer counter to the contra order, second to marketmaking orders from the identified preferred sellside participant, third to a subset of marketmaking orders of the plurality of marketmaking orders that the buyside participant is approved to trade against and whose sellside submitter has an order at the best bid or offer counter to the contra order, and fourth to marketmaking orders that the buyside participant is approved to trade against and whose sellside submitter does not have an order at the best bid or offer counter to the contra order” encompasses no more than generically invoking a electronic platform to apply the Judicial Exception step of distribute the contra order according a priority scheme;
the limitation “determine new best bid and offer prices in the order book in response to the distribution” encompasses no more than generically invoking a electronic platform to apply the Judicial Exception step of determining new best bid and offer prices in response to the distribution;
the limitation “ automatically adjust remaining market making orders of the plurality of marketmaking orders to retain a pegged price in response to determining the new best bid or offer” encompasses no more than generically invoking a electronic platform to apply the Judicial Exception step of adjusting remaining market making orders to retain a pegged price;
the limitation “wherein the electronic exchange platform is further configured to apply a price compaction rule by limiting the pegged price to a fractional price increment when the pegged price would otherwise cross the fractional price increment” encompasses no more than generically invoking a electronic platform to apply the Judicial Exception step of applying a price compaction rule by limiting the pegged price;
the limitation “receive from the first buyside participant a preference indicator identifying a preferred sellside participant” encompasses no more than generically invoking a electronic platform to apply the Judicial Exception step of receiving a preference indicator from the first buyside participant;
the limitation “apply the preference indicator to override a default distribution determination such that a passive liquidity provision order of the preferred sellside participant is preferentially filled” encompasses no more than generically invoking a electronic platform to apply the Judicial Exception step of applying the preference indicator to override a default distribution;
the limitation “store a bilateral counterparty approval matrix having cells indicating, for each pair of a sellside participant and a buyside participant, whether the participants have mutually approved one another for trading” encompasses no more than generically invoking a electronic platform to apply the Judicial Exception step of storing the bilateral counterparty approval matrix;
the limitation “determine the orders accessible to each buyside participant by traversing the bilateral counterparty approval matrix before populating the respective interface of each buyside participants with market information” encompasses no more than generically invoking a electronic platform to apply the Judicial Exception step of determining the orders accessible to each buyside participant by traversing the bilateral counterparty approval matrix before providing market information for each buyside participant;
the limitation “include the randomized customer identifier in post-trade messaging transmitted to the sellside participant counter to the trade” encompasses no more than generically invoking a electronic platform to apply the Judicial Exception step of including the randomized customer identifier in post-trade messaging to the sellside participant;
the limitation “remove the buyside participant associated with the randomized customer identifier from one or more approved-counterparty lists of the sellside participant without revealing the identity of the buyside participant to the sellside participant” encompasses no more than generically invoking a electronic platform to apply the Judicial Exception step of removing the buyside participant associated with the randomized customer identifier from the one or more approved-counterparty lists of the sellside participant with revealing the identity of the buyside participant.
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 “populate a respective interface” are generically recited to perform input/output steps described only by a result-oriented solution with insufficient detail for how the interface accomplish it.
The examiner further noted generic computer affixes such as “electronic … platform” and “automatically” are appended to abstract elements such as “exchange”, “peg a price” and “adjust remaining market making orders”, 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 an electronic platform to allocate 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. Dependent claim 3-6, 8, 13-16 and 18 merely limit the abstract idea but do not recite any additional element beyond the cited abstract idea, thus, do not amount to significantly more. 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 06/12/2026 have been fully considered but they are not persuasive.
Regarding the applicant’s argument that claims are directed to a specific improvement to the way computers operate, the examiner respectfully disagrees. The applicant contended that the claims solve problems unique to electronic exchange platforms – how to efficiency manage marketmaking liquidity between sellside and buyside participants; how to restrict which buyside participant; and how to keep prices to remain pegged to a best price. However, the applicant did not demonstrate how these problems are technological problems unique electronic exchange platform instead of any exchange environment. The examiner noted that liquidity management, participant restriction and price pegging are problem related to the financial aspect of an exchange, not the technological aspect of electronic exchange such as latency and bandwidth. As such, the argument is not persuasive.
Regarding the applicant’s argument that claims integrate the Judicial Exception into practical application, the examiner respectfully disagrees. The applicant’s premise rests upon alleged improvement of solving the problem discussed above. Since the applicant failed to link the alleged problems to technology or computer functionality, the argument is not persuasive.
Regarding the applicant’s argument that claims amount to significantly more, the examiner respectfully disagrees. The applicant’s premise rests upon the absence of 102 or 103 rejection. It should be noted that “even newly discovered judicial exceptions are still exceptions, despite their novelty. For example, the mathematical formula in Flook, the laws of nature in Mayo, and the isolated DNA in Myriad were all novel, but nonetheless were considered by the Supreme Court to be judicial exceptions because they were “‘basic tools of scientific and technological work’ that lie beyond the domain of patent protection.” (See July 2015 Update of IGPSME Page 3) 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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If attempts to reach the examiner by telephone are unsuccessful, the examiner’s supervisor, MICHAEL W ANDERSON can be reached at 571-270-0508. The fax phone number for the organization where this application or proceeding is assigned is 571-273-8300.
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/CHO YIU KWONG/Primary Examiner, Art Unit 3693
