Wednesday, February 15, 2012

Edelson finds an abstract intangible asset

Finance mazeEx Parte Edelson, No. 2011-004285 (BPAI Feb 6, 2012) involved a way for creating financial instrument derivatives of rollups of recurrent yield monetary based assets. Whatever that means. The inventor Harry Edelson briefed counsel to appear before the Board of Patent Appeals and Interferences for his US Application Number 11/101,436.

Claims 11-13 and 15-20 had been rejected by the Examiner as directed to non-statutory subject matter.

Claim 11, for example, read as follows:
11. A computer-implemented method for creating recurrent yield monetary asset based financial instrument derivatives by a rollup entity in communication with at least one recurrent yield monetary asset resource, said recurrent yield monetary asset having an asset value, said method comprising:

communicating between said rollup entity and said at least one recurrent yield monetary asset resource regarding acquiring an at least one recurrent yield monetary asset selected from the group consisting of royalties, salaries, royalty-type streams of revenues, publishing royalties, copyright royalties, trademark royalties, patent royalties, oil-revenue royalties, movie and video publishing royalties, said recurrent yield monetary assets;
transferring from said at least one recurrent yield monetary asset resource to said rollup entity said recurrent yield monetary asset;

depositing said one recurrent yield monetary asset into a rollup entity earnings account;

calculating at least one of the group consisting of a cash value and a number of shares of said financial instrument derivatives based on said asset value; and

issuing from said rollup entity to said at least one recurrent yield monetary asset resource said calculated number of shares of said financial derivative instrument.
Abstract idea

The Examiner had objected that claim 11 performs no physical transformation and does not recite how a specific machine is used. Therefore the claim recites no more than an abstract idea.

The Appellant argued that the claim wasn't just to an abstract idea. The claim, said the Appellant, transforms a royalty stream into a derivative.

Abstract concept

The Board agreed with the Examiner. They said that claim 11 does no more than lay out the concept of issuing a derivative instrument.

The claims, said the Board, don't refer to a specific machine by reciting structural limitations to any apparatus.  The claims don't recite any specific operations that would cause a machine to be the mechanism to communicate or calculate information, or to deposit or issue an intangible asset.

The Board went further and observed that to communicate, calculate or issue intangible information requires no machine, only the conscious thought of the one controlling the operation. To deposit such intangible information requires only an agreement that such a deposit is made.

The Board concluded that, absent any specific structural limitations on how one acts to perform these steps, these claims recite no more than the abstract concept of issuing an abstract intangible asset. A patent would effectively grant a monopoly over an abstract idea.

Computer-implemented is computer aided

The Board went on to consider the term "computer-implemented method" in claim 11.  Citing Cybersource Corp. v Retail Decisions, Inc., 654 F.3d 1366 (Fed. Cir. Aug 16, 2011) (see my blog post), they said that simply using some computer-implemented method in some undefined manner alone cannot confer patentability.

Citing Dealertrack v Huber Case No. 2009-1566, the Board noted that the phrase "computer-implemented" modifier is comparable in scope to "computer-aided" and so its inclusion in the preamble does not change the outcome.

Further steps

The Board affirmed the Examiner's rejection of claims 11-13 and 15-20 as directed to non-statutory subject matter.

Photo courtesy of author RambergMediaImages under Creative Commons licence.

1 comment:

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