Trials@uspto.gov
`571-272-7822
`
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`Paper 46
`Entered: January 25, 2016
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`WESTLAKE SERVICES, LLC,
`Petitioner,
`
`v.
`
`CREDIT ACCEPTANCE CORP.,
`Patent Owner.
`____________
`
`Case CBM2014-00176
`Patent 6,950,807 B2
`____________
`
`Before JUSTIN T. ARBES, DAVID C. McKONE, and
`GREGG I. ANDERSON, Administrative Patent Judges.
`
`McKONE, Administrative Patent Judge.
`
`FINAL WRITTEN DECISION
`35 U.S.C. § 328(a) and 37 C.F.R. § 42.73
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`571-272-7822
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`Paper 46
`Entered: January 25, 2016
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`WESTLAKE SERVICES, LLC,
`Petitioner,
`
`v.
`
`CREDIT ACCEPTANCE CORP.,
`Patent Owner.
`____________
`
`Case CBM2014-00176
`Patent 6,950,807 B2
`____________
`
`Before JUSTIN T. ARBES, DAVID C. McKONE, and
`GREGG I. ANDERSON, Administrative Patent Judges.
`
`McKONE, Administrative Patent Judge.
`
`FINAL WRITTEN DECISION
`35 U.S.C. § 328(a) and 37 C.F.R. § 42.73
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`CBM2014-00176
`Patent 6,950,807 B2
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`I. INTRODUCTION
`
`A. Background
`Westlake Services, LLC d/b/a Westlake Financial Services
`(“Petitioner”) filed an Amended Petition (Paper 5, “Pet.”) to institute a
`covered business method patent review of claims 1–42 of U.S. Patent
`No. 6,950,807 B2 (“the ’807 patent”). Credit Acceptance Corp. (“Patent
`Owner”) filed a Preliminary Response (Paper 14, “Prelim. Resp.”). Pursuant
`to 35 U.S.C. § 324, in our Decision to Institute, we instituted this proceeding
`as to claims 10–12 and 14–33 on the asserted ground that the challenged
`claims are directed to non-statutory subject matter, under 35 U.S.C. § 101.
`Paper 15 (“Dec.”).
`After the Decision to Institute, Patent Owner filed a Patent Owner
`Response (Paper 27, “PO Resp.”), and Petitioner filed a Reply to the Patent
`Owner Response (Paper 35, “Reply”). An oral hearing was held on
`September 10, 2015. Paper 44 (“Tr.”).
`We have jurisdiction under 35 U.S.C. § 6(c). This Decision is a final
`written decision under 35 U.S.C. § 328(a) as to the patentability of the
`challenged claims. Based on the complete record, Petitioner has
`demonstrated, by a preponderance of the evidence, that claims 10–12 and
`14–33 are unpatentable.
`
`B. Related Matters
`Petitioner has been sued for infringement of the ’807 patent in Credit
`Acceptance Corp. v. Westlake Services LLC, No. 2:13-cv-01523-SJO-MRW
`(C.D. Cal.). Pet. 2; Paper 8, 2. On August 24, 2015, the District Court
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`granted Patent Owner’s motion to dismiss the district court case voluntarily
`with prejudice. Ex. 2004.
`The Board previously conducted a covered business method patent
`review of claims 1–9, 13, and 34–42 of the ’807 patent in Westlake Services,
`LLC v. Credit Acceptance Corp., Case CBM2014-00008 (“CBM-008”). In
`CBM-008, in a Final Written Decision (CBM-008, Paper 66 (“008-FWD”)),
`we determined that claims 1–9, 13, and 34–42 of the ’807 patent are
`unpatentable under 35 U.S.C. § 101. Patent Owner did not appeal that
`determination.
`
`C. The Asserted Ground
`We instituted this proceeding on Petitioner’s ground challenging
`claims 10–12 and 14–33 as ineligible for patenting under 35 U.S.C. § 101.
`Dec. 30.
`
`D. CBM-008
`In CBM-008, Petitioner petitioned for review of claims 1–42 of the
`’807 patent. CBM-008, Paper 8. We instituted a trial as to claims 1–9, 13,
`and 34–42. CBM-008, Paper 30. After our institution decision, and after
`Petitioner had filed a request for rehearing on other grounds, the Supreme
`Court issued Alice Corp. Pty. LTD v. CLS Bank International, 134 S. Ct.
`2347 (2014), and vacated Ultramercial, Inc. v. Hulu, LLC, 722 F.3d 1335
`(Fed. Cir. 2013) (Ultramercial II) (see WildTangent, Inc. v. Ultramercial,
`LLC, 134 S. Ct. 2870 (2014)). We denied Petitioner authorization to file a
`second rehearing request to address Alice, but noted that Petitioner was free
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`to file another Petition challenging the claims of the ’807 patent not
`addressed in CBM-008. CBM-008, Paper 40, 3.
`Petitioner then filed the Petition in this proceeding. Subsequent to
`the filing of the Petition, the Federal Circuit, on remand from the Supreme
`Court, decided Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709 (Fed. Cir.
`2014) (Ultramercial III), finding the claims at issue ineligible for patent
`protection—an opposite result to what had been determined in Ultramercial
`II. On March 24, 2015, after Ultramercial III and the institution of this
`proceeding (as to claims 10–12 and 14–33), we issued the 008-FWD, finding
`claims 1–9, 13, and 34–42 unpatentable under 35 U.S.C. § 101, a decision
`that Patent Owner declined to appeal.
`
`
`II. ANALYSIS
`A. The ’807 Patent (Ex. 1001)
`The ’807 patent relates to a method for facilitating the purchase of
`products on credit and a system for implementing such a method, as may be
`employed in the sale of automobiles and other vehicles, for example.
`Ex. 1001, 1:5–9. The invention is not limited to vehicle sales and also may
`be applied to the sale of any products for which a customer desires to
`finance the transaction. Id. at 1:9–12.
`The ’807 patent describes a system and method for providing
`financing to the customers of a dealer to allow the customers to purchase
`products from the dealer’s inventory. Id. at 3:27–30. The system,
`implementing the method, generates prospective financing packages for
`every item in the dealer’s inventory. Id. at 3:30–32.
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`Figure 6 is reproduced below:
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`Figure 6 is an example of a screen displaying several financing
`packages. Id. at 5:1–2. According to this example, a financing package
`includes a set price a customer would agree to pay for a particular vehicle
`(selling price in column 312), a down payment the customer would pay
`(column 314 shows down payment percentages), and an agreement by the
`customer to pay the rest of the sale price with interest in a series of monthly
`payments (column 324 shows monthly payment amounts and column 326
`shows the number of months in the financing term). Id. at 8:40–45, 9:26–31.
`A party extending financing agrees to pay an “advance amount” when a sale
`is completed (column 316). “[T]he advance amount is determined by the
`party extending financing based on the customer’s credit score, the
`dealership’s past collection history, the particular vehicle being considered
`and other factors.” Id. at 9:21–24. As can be seen, the advance amount and
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`the down payment together can be less than the sale price—in other words,
`the lender might not agree to loan the full purchase price to the customer.
`The dealer’s cost for each vehicle is shown in column 318 of Figure 6.
`The patent describes two types of profit realized by the dealer. First,
`“[t]he front-end profit is the actual profit that the dealer realizes immediately
`upon closing a sale with the customer,” and “[p]ut simply . . . is equal to the
`down payment amount plus the advance amount minus the dealer’s costs.”
`Id. at 8:53–62. This is shown in column 320 of Figure 6. Id. at 9:29.
`Second, “[t]he back-end profits are generated by the monthly payments
`received from the customer in satisfaction for the outstanding obligation.”
`Id. at 8:63–65. As explained above, the purchase price might be higher than
`the down payment plus the advance amount. In this case, the dealer receives
`a share of the customer’s monthly payments. Id. at 8:65–67. According to
`the example in the patent, the dealer’s share of the monthly payments first is
`credited towards paying back the advance amount. Id. at 9:2–4. The
`dealer’s back-end profits can be estimated (column 322 of Figure 6) by
`“multiplying the total payment amount by the dealer’s percentage share of
`collections and subtracting the advance amount” and, if a more realistic
`estimate is desired, by taking into account an expected payment collection
`rate. Id. at 9:11–17.
`Claim 14, reproduced below, is illustrative of the claimed subject
`matter:
`
`14. A system for providing guaranteed financing to a
`customer for allowing the customer to purchase a product from
`an inventory of a dealer, the system comprising:
`a financing package generating unit including a database
`configured to store the inventory of the dealer
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`including a plurality of individually priced items,
`and a calculation unit;
`a user terminal adapted to accept credit information from
`the customer and further adapted to transmit the
`credit information over a network; and
`a server configured to receive credit information through
`the network, and to access the financing package
`generating unit, which retrieves a credit report
`related to the customer, and calculates a credit score
`for the customer based on the credit report and the
`credit
`information,
`the
`financing
`package
`generating unit
`further generating
`financing
`packages for each of the individually priced items
`in the database, the financing packages including a
`front-end profit calculated based on the credit score,
`payment of an advance amount to the dealer in
`furtherance of the sale, and dealer costs, the server
`being[] further configured to transmit the financing
`packages to the user terminal for presentation to the
`dealer for immediate offer for sale to the customer.
`
`B. Whether the ’807 Patent is a Covered Business Method Patent
`In the Decision to Institute, at 8–9, we determined that the ’807 patent
`is a covered business method patent. We also made that determination in
`CBM-008, in the Final Written Decision, at 19–20. Patent Owner did not
`appeal that decision. Patent Owner also does not contest the determination
`in its Patent Owner Response. Thus, we are presented with no reason to
`change our original determination.
`
`C. Claim Construction
`We interpret claims of an unexpired patent using the broadest
`reasonable construction in light of the specification of the patent in which
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`they appear. See 37 C.F.R. § 42.300(b); In re Cuozzo Speed Techs., LLC,
`793 F.3d 1268, 1278 (Fed. Cir. 2015). Claim terms generally are given their
`ordinary and customary meaning, as would be understood by one of ordinary
`skill in the art in the context of the entire disclosure. See In re Translogic
`Tech., Inc., 504 F.3d 1249, 1257 (Fed. Cir. 2007).
`
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`1. Terms Construed in CBM-008
`As summarized in the table below, in the 008-FWD, we construed
`several terms that are applicable to the claims at issue in this proceeding:
`Claim Term
`Construction from 008-FWD
`“front-end profit” (claims
`“The down payment amount plus the advance
`amount minus the dealer cost.” 008-FWD, 7.
`14, 26, and claims that
`depend from claim 1)
`“advance amount” (claims
`14, 25, and claims that
`depend from claim 1)
`“database” (claims 14, 25,
`and claims that depend
`from claim 1)
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`“The amount the party extending the
`financing agrees to pay the dealer when the
`sale is complete.” 008-FWD, 8.
`“Electronic collection of data stored on and/or
`accessible by a computer.” 008-FWD, 9.
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`In the PO Response, Patent Owner proposes a narrower construction
`of “advance amount.” Although it does not propose an express construction,
`Patent Owner argues:
`An advance amount is only a portion of what the lender will
`ultimately pay to the dealer through the collection process, and
`is distinct from the prior art situation in which the dealer receives
`the full balance from the lender immediately, placing the burden
`on the lender to collect the monthly payments from the customer.
`Thus, an advance amount is not the sales price minus the dealer’s
`costs plus the down payment.
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`PO Resp. 21 (emphasis omitted). Our construction in the 008-FWD, by its
`terms, does not limit an advance amount to less than the sales price minus
`the buyer’s down payment. Rather, the lender might advance the full
`balance not paid up front by the buyer. Patent Owner does not identify any
`disclosure in the Specification defining or describing an advance amount.
`Nevertheless, according to Patent Owner, because the ’807 patent describes
`the invention in terms of the dealer receiving a share of all customer
`payments received over time, an advance amount must be less than the full
`balance due to the dealer. Id. at 22.
`
`As explained in the 008-FWD, the Specification describes an advance
`amount as the amount of money a lender agrees to pay to the dealer.
`Ex. 1001, 8:45–46. “[T]he advance amount is determined by the party
`extending financing based on the customer’s credit score, the dealership’s
`past collection history, the particular vehicle being considered and other
`factors.” Id. at 9:21–24. Although the advance amount could be less than
`the sales price minus the down payment, the Specification does not require
`that it be so.
`
`In any case, Patent Owner has since accepted our construction of
`“advance amount” and has chosen not to contest it in this proceeding.
`Tr. 28:1–12. We maintain that construction on the full record of this
`proceeding.
`
`The parties do not argue in this proceeding for different constructions
`of “front-end profit” and “database.” We maintain these constructions on
`the full record of this proceeding.
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`2. Terms That Do Not Need Construction
`Additionally, in the 008-FWD, we determined that the following
`terms, also relevant to claims at issue in this proceeding, required no express
`construction: “receiving information related to a database,” “receiving
`information from the customer,” “calculating,” “determining,”
`“presenting . . . to the dealer,” “automatically recalculated,” “transmitted,”
`“generating,” and “selectable criteria.” 008-FWD, 10–18.
`In the Petition, Petitioner addressed several of these terms,
`contending, inter alia, that “receiving information related to a database of a
`dealer’s inventory,” “receiving information from the customer,” “calculating
`a credit score for the customer based at least in part on the information
`gathered from the customer,” and terms including “determining” are
`indefinite under 35 U.S.C. § 112, second paragraph. Pet. 32–33, 39, 41. We
`declined to institute on that ground, concluding that the Petition’s showing
`was unpersuasive. Dec. 27. The parties propose no other constructions for
`these terms. On the complete record of this proceeding, we maintain our
`decision not to construe these terms expressly.
`
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`3. Additional Terms Construed in the Decision to Institute
`In the Decision to Institute, we preliminarily construed “calculation
`unit” to mean “a computer component configured to calculate” and
`“financing package generating unit” to mean “a computer component that
`generates financing packages and contains a database and a calculation
`unit.” Dec. 7. In the Petition, Petitioner contends that these terms are
`indefinite. Pet. 36. As stated above, we declined to institute on the asserted
`ground of indefiniteness. Dec. 27. The parties do not dispute further these
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`constructions in the Patent Owner Response and Reply. On the complete
`record, we maintain these constructions.
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`D. Asserted Ground under 35 U.S.C. § 101
`Petitioner alleges that each of the challenged claims is ineligible for
`patenting under Section 101.
`Section 101 establishes that patent protection may be obtained for
`“new and useful process[es], machine[s], manufacture[s], or composition[s]
`of matter.” 35 U.S.C. § 101. A “process” is defined as a “process, art or
`method, and includes a new use of a known process, machine, manufacture,
`composition of matter, or material.” 35 U.S.C. § 100(b). The Supreme
`Court has long held that § 101 contains an implicit exception for “[l]aws of
`nature, natural phenomena, and abstract ideas.” Ass’n for Molecular
`Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107, 2116 (2013).
`In Alice, the Supreme Court set forth a framework for distinguishing
`claims directed to abstract ideas from those directed to patent-eligible
`applications of those abstract ideas. According to that framework, we first
`determine whether a claim is directed to an abstract idea. 134 S. Ct. at 2355.
`Second, “we consider the elements of each claim both individually and ‘as
`an ordered combination’ to determine whether the additional elements
`‘transform the nature of the claim’ into a patent-eligible application.”
`Id. (quoting Mayo Collaborative Servs. v. Prometheus Labs., Inc., 132 S. Ct.
`1289, 1297–98 (2012)).
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`1. Whether the claims are directed to an abstract idea
`The first prong of the Alice test requires us to determine whether the
`challenged claims are directed to an abstract idea. Alice, 134 S. Ct. at 2355.
`According to the Federal Circuit, “determining whether the section
`101 exception for abstract ideas applies involves distinguishing between
`patents that claim the building blocks of human ingenuity—and therefore
`risk broad pre-emption of basic ideas—and patents that integrate those
`building blocks into something more, enough to transform them into specific
`patent-eligible inventions.” Versata Dev. Grp., Inc. v. SAP Am., Inc., 793
`F.3d 1306, 1332 (Fed. Cir. 2015) (emphasis added); accord id. at 1333–34
`(“It is a building block, a basic conceptual framework for organizing
`information . . . .” (emphasis added)). This is similar to the Supreme Court’s
`formulation in Bilski v. Kappos, 561 U.S. 593, 611 (2010) (emphasis added),
`noting that the concept of risk hedging is “a fundamental economic practice
`long prevalent in our system of commerce.”
`To distinguish between the types of inventions directed to building
`blocks, or basic conceptual frameworks, and those directed to patent-eligible
`applications of such building blocks, the Federal Circuit has been guided by
`examples from previous cases. For instance, the Versata Court found it
`“helpful . . . to highlight briefly a few salient points [from previous cases] as
`a means of comparison to the invention and claims” at issue in Versata. 793
`F.3d at 1332–33, comparing the claims to those at issue in:
`Alice (abstract idea of intermediated settlement);
`Parker v. Flook, 437 U.S. 584 (1978) (mathematical
`formula for computer alarm limits in a catalytic
`conversion process);
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`Gottschalk v. Benson, 409 U.S. 63 (1972) (mathematical
`algorithm for converting binary-coded decimal
`numerals into pure binary form);
`Content Extraction & Transmission LLC v. Wells Fargo
`Bank, Nat’l Ass’n, 776 F.3d 1343 (Fed. Cir. 2014)
`(abstract idea of collecting data from hard-copy
`documents, recognizing certain information within
`the collected data, and storing that information in
`memory);
`Ultramercial III (abstract idea of using an advertisement
`as an exchange or currency);
`buySAFE, Inc. v. Google, Inc., 765 F.3d 1350 (Fed. Cir.
`2014) (abstract idea of creating a contractual
`relationship);
`and Bancorp Services, L.L.C. v. Sun Life Assurance Co. of
`Canada (U.S.), 687 F.3d 1266 (Fed. Cir. 2012)
`(abstract idea of managing a stable value life
`insurance policy),
`and contrasting the claims with those at issue in:
`Diamond v. Diehr, 450 U.S. 175 (1981) (computer-
`implemented process for curing rubber, using a
`known equation in a process to solve a technical
`problem in conventional industry practice); and
`DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245
`(Fed. Cir. 2014) (claims reciting a solution that was
`necessarily rooted in computer technology to
`overcome a problem specifically arising in the
`realm of computer networks).
`Taking a similar approach in OIP Technologies, Inc. v. Amazon.com,
`Inc., 788 F.3d 1359, 1362 (Fed. Cir. 2015), the Federal Circuit reasoned that
`the “concept of ‘offer based pricing’ is similar to other ‘fundamental
`economic concepts’ found to be abstract ideas by the Supreme Court and
`this court” (comparing the claims at issue to those in Alice, 134 S. Ct. at
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`2357; Bilski (abstract idea of risk hedging); Ultramercial III; Content
`Extraction; Accenture Global Servs., GmbH v. Guidewire Software, Inc.,
`728 F.3d 1336 (Fed. Cir. 2013) (abstract idea of generating tasks in an
`insurance organization)). In another example, in Intellectual Ventures I
`LLC v. Capital One Bank (USA), 792 F.3d 1363, 1367 (Fed. Cir. 2015)
`(emphasis added), the Federal Circuit concluded that claims directed to
`tracking financial transactions to determine whether they exceed a pre-set
`spending limit were abstract because they were “not meaningfully different
`from the ideas found to be abstract in other cases before the Supreme Court
`and our court involving methods of organizing human activity.” See also
`DDR Holdings, 773 F.3d at 1256 (“Although many of the claims [in
`previous cases] recited various computer hardware elements, these claims in
`substance were directed to nothing more than the performance of an abstract
`business practice on the Internet or using a conventional computer. Such
`claims are not patent-eligible.” (emphasis added)). The Supreme Court also
`has looked to examples from prior cases to discern the abstract from the
`patent-eligible. See, e.g., Alice, 134 S. Ct. at 2357 (comparing the claims to
`those in Bilski and concluding that there was “no meaningful distinction
`between the concept of risk hedging in Bilski and the concept of
`intermediated settlement at issue” in Alice).
`From these cases, it is clear that claims directed simply to business
`practices, methods of organizing human activity, and economic relations,
`even if practiced on a computer or the Internet, may be directed to abstract
`ideas (subject, of course, to the second prong of the Alice framework).
`See buySAFE, 765 F.3d at 1354 (“In simultaneously rejecting a general
`business-method exception to patent eligibility and finding the hedging
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`claims invalid, moreover, Bilski makes clear that the recognition that the
`formation or manipulation of economic relations may involve an abstract
`idea does not amount to creation of a business-method exception. The
`required section 101 inquiry has a second step beyond identification of an
`abstract idea. If enough extra is included in a claim, it passes muster under
`section 101 even if it amounts to a ‘business method.’”).
`Petitioner contends that independent claims 1,1 14, and 25 are directed
`to the abstract idea of “providing financing,” and that this concept is a
`“fundamental economic practice.” Pet. 21. In CBM-008, we concluded that
`claim 1 is directed to the abstract idea of “processing an application for
`financing a purchase.” 008-FWD, 26.
`Claim 1 recites receiving information, including sale prices and dealer
`costs, for items in a dealer’s inventory; receiving down payment information
`from a customer wishing to buy a product from the dealer; calculating a
`credit score for the customer; determining how much a lender will advance
`to the dealer (advance amount) for each product in the inventory (which
`need only include two products); calculating profits for the inventory items2
`(using arithmetic based on the advance amount, dealer cost, and down
`payment); and presenting a financing package (with unspecified
`information) to the dealer for each product in the inventory. The underlying
`concept of claim 1, when viewed as a whole, simply is to receive
`information from a customer’s credit application, process that information,
`
`1 Claim 10, at issue in this case, depends from claim 1. Thus, our analysis of
`claim 10 starts with claim 1.
`2 Claim 1 does not recite using such profit information. Claim 12 later
`recites sorting the financing packages based on selectable criteria, which
`could be profit.
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`and present the processed information as potential financing packages to the
`dealer. Rephrased, this is the abstract idea of “processing an application for
`financing a purchase.”
`Claim 10 depends from claim 1 and adds providing generic computer
`structure for performing the steps of claim 1 (a “user terminal” for entering
`customer information; and a “server” connected to the user terminal “via a
`network,” for receiving information, accessing the database, performing
`claim 1’s arithmetic to generate financing packages, and transmitting the
`financing packages to the user terminal). Thus, claim 10 recites the same
`abstract concept as recited in claim 1, performed with generic computer
`components.
`Claim 14 recites a system, with generic computer components, to
`collect information from a customer, retrieve a credit report, calculate a
`credit score, and generate financing packages for each item of a dealer’s
`inventory. A financing package includes an amount that a lender will
`contribute (an advance amount) and a front-end profit the dealer will make
`(calculated based on the customer’s credit score, the sale price, down
`payment, advance amount, and vehicle cost). Claim 25 is similar to claim
`14, reciting generic computer components (“database,” “user terminal,”
`“server,” and “network”) for storing inventory information, receiving and
`communicating financial information about a customer, and generating and
`sending financing packages for each product in the inventory. Claims 14
`and 25 also recite the same abstract concept recited in claim 1, albeit
`implemented using generic computer components. Claims 14 and 25 also
`are directed to the abstract idea of processing an application for financing a
`purchase.
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`We conclude that processing an application for financing a purchase is
`a method of organizing human activity, or the performance of an abstract
`business practice. As we found in CBM-008, the ’807 patent describes
`processing a financing application as routine and conventional. 008-FWD,
`26–27 (“Specifically, the ’807 patent describes processing a financing
`application as: a customer completing a credit application; obtaining
`financing from a financing institution; the customer providing a down
`payment and signing a promissory note to the dealer; and the financing
`institution paying the dealer the balance for the purchase after applying the
`down payment. [Ex. 1001] at 1:33–2:14. If the financing is not completed,
`the process is repeated. Id. at 2:15–50.”). We note that processing an
`application for financing a purchase is a mere building block of human
`ingenuity, similar to the building blocks identified by the Supreme Court and
`the Federal Circuit. Cf. Alice (abstract idea of intermediated settlement);
`Bilski (abstract idea of risk hedging); Content Extraction (abstract idea of
`collecting data from hard-copy documents, recognizing certain information
`within the collected data, and storing that information in memory);
`Ultramercial III (abstract idea of using an advertisement as an exchange or
`currency); buySAFE (abstract idea of creating a contractual relationship);
`Bancorp Services (abstract idea of managing a stable value life insurance
`policy).
`Indeed, as we explained in the 008-FWD, at 33, the challenged claims
`are not meaningfully different from those found non-statutory in
`DealerTrack, Inc. v. Huber, 674 F.3d 1315 (Fed. Cir. 2012). In
`DealerTrack, the claims at issue essentially recited using a computer to
`receive loan application data from one source, selectively forward the data to
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`CBM2014-00176
`Patent 6,950,807 B2
`remote funding sources, and forward reply data to the first source. 674 F.3d
`at 1333. The Federal Circuit determined that this was the abstract concept of
`processing information through a clearinghouse, notwithstanding the
`recitation of a generic computer. Id. The idea of claims 10, 14, and 25 is
`similarly abstract. Likewise, the challenged claims are not meaningfully
`different from those recently found abstract (despite recitations of generic
`computer components) in Mortgage Grader, Inc. v. First Choice Loan
`Services, 2015-1415 (Fed. Cir. Jan. 20, 2015), slip. op at 15 (“The series of
`steps covered by the asserted claims—borrower applies for a loan, a third
`party calculates the borrower’s credit grading, lenders provide loan pricing
`information to the third party based on the borrower’s credit grading, and
`only thereafter (at the election of the borrower) the borrower discloses its
`identity to a lender—could all be performed by humans without a
`computer.”).
`Patent Owner argues that the challenged claims recite “specific
`methods and systems for providing financing in a particular manner that
`cannot be accurately captured in a single abstract idea or fundamental
`economic practice.” PO Resp. 7. Specifically, Patent Owner argues that the
`claims recite “tangible, physical steps,” giving examples such as “retrieves a
`credit report,” recited in claim 14, and “transmit . . . to the user terminal over
`the network for display,” recited in claim 10. Id. We are not persuaded, as
`we view such data gathering and display steps as the type of post-solution
`activity that the courts routinely have found insignificant. See Alice, 134 S.
`Ct. at 2350; see also In re Bilski, 545 F.3d 943, 963 (Fed. Cir. 2008) (“This
`court and our predecessor court have frequently stated that adding a data-
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`CBM2014-00176
`Patent 6,950,807 B2
`gathering step to an algorithm is insufficient to convert that algorithm into a
`patent-eligible process.”).
`Patent Owner contends that calculating advance amounts for each
`item in an inventory is integral to the solution itself, not mere post-solution
`activity. PO Resp. 7–8. Patent Owner further contends that “the
`specifically-configured computer components are not simply for show - the
`physical components (server, terminal, network, database, calculation unit)
`are core limitations because they are necessary to effectively practice the
`invention,” and, thus, “the claims as a whole are more akin to a patent-
`eligible physical process.” Id. at 8–9. These arguments more properly are
`directed to Alice’s second prong. Indeed, Patent Owner reiterates these
`arguments, in more detail, when addressing the second prong of the Alice
`framework. We address these arguments in Section II.D.2 below.
`Patent Owner appears to contend that the Supreme Court’s use of
`phrases such as “conventional,” “routine,” and “fundamental” in
`characterizing abstract ideas imports a novelty/nonobviousness requirement
`into the statutory subject matter analysis. PO Resp. 7–8 n.2; see also
`Tr. 31:5–32:8 (“Are we really talking 102, or are we talking 101, but when
`the question is asked, is something fundamental, or is something a basic
`enterprise or a building block of science, what you want to do is you want to
`look at the whole claim and to see what it’s claiming, to see if you find that
`elsewhere, and you can say, no, what they are, this particular thing was done
`in the past and now they’re just doing it on a computer. Or this particular
`thing has been done since time immemorial.”). Patent Owner reiterates this
`argument when addressing the second prong of the Alice framework,
`contending that the concept of an “advance amount,” as recited in the
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`CBM2014-00176
`Patent 6,950,807 B2
`challenged claims, “is distinct from the prior art situation in which the dealer
`receives the full balance from the lender immediately.” Id. at 21. Patent
`Owner relies on this purported novelty to argue that “the calculation of
`advance amounts for every item in inventory as described in the ’807 Patent
`does not constitute routine or conventional practice.” Id. at 22.
`We do not view Section 101 as including a novelty/obviousness
`requirement. To be sure, the Court in Alice, endorsing language used in
`Bilski, concluded that the concept of intermediated settlement is “a
`fundamental economic practice long prevalent in our system of commerce.”
`Alice, 134 S. Ct. at 2356 (quoting Bilski, 561 U.S. at 611). Nevertheless, we
`view the Supreme Court’s description of an economic practice as “long
`prevalent” to be an example of a fundamental economic practice rather than
`an implied novelty requirement. Indeed, the Bilski court made clear that
`Section 101 “is only a threshold test,” and novelty and nonobviousness are
`additional requirements that are evaluated under Sections 102 and 103. 561
`U.S. at 602.
`Additional Supreme Court precedent supports this view. In Flook, in
`order to evaluate whether additional aspects of a claim to a mathematical
`algorithm added an inventive concept, the Supreme Court treated th
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