In addition to the requisite "useful, concrete and tangible result," having "clear world value," method claims in the U.S. that are not "tied to a technological art or environment" may be subject to a §101 non-statutory subject matter rejection based on the U.S. Patent and Trademark Office's current interpretation of Ex parte Bowman, 61 U.S.P.Q. 1669 (BPAI 2001). This latest direction in U.S. patent examination policy appears to parallel the "technical character" approach of the European, U.K., and Japanese Patent Offices.

In this unpublished and non-precedential opinion, the appealed claims were directed to a method of evaluating an intangible asset of interest:

A method of evaluating an intangible asset of interest, comprising the steps of:

establishing first and second variables related to the value of said intangible asset of interest;

establishing a series of performance criteria statements probative of the value of said first and second variables;

scoring each of the said performance criteria statements;

summing scores to generate first and second total scores based upon the extent to which individual statements accurately describe said intangible asset of interest;

transforming physical media into a chart having a first axis relating to said first variable and a second axis relating to said second variable;

physically plotting a point on said chart, said point being located at coordinates corresponding to said first and second total scores respectively, and,

using said chart in making at least one decision regarding the value of said intangible asset of interest.

The Examiner asserted that the claimed invention did not fall within the technological arts because no form of technology was disclosed or claimed. The Appellant argued that, under the USPTO’s Examination Guidelines for Computer-Related Inventions creating a chart and plotting a point is "physical and has clear real world value." In particular, the claimed process resulted in a physical transformation outside of a computer for which a practical application in the technological arts is either disclosed in the specification or would have been known to a skilled artisan.

In an opinion written by Administrative Patent Judge Smith, the Board agreed with the Examiner, noting that "Appellant has carefully avoided tying the disclosed and claimed invention to any technological art or environment." The Board reasoned that the invention was directed merely to a human making mental computation and manually plotting results on paper and thus is nothing more than an abstract idea which is not tied to any technological art or environment. According to the Board, an abstract idea does not become a technological art merely by the recitation of "transforming physical media into a chart" and "physically plotting a point on said chart."

In fact, Appellant cited the discussion in State Street Bank & Trust Co. v. Signature Fin. Group, Inc., 149 F.3d 1368, 47 USPQ2d 1596 (Fed. Cir. 1998)(holding that asset allocation algorithms provide a "useful, concrete, and tangible result") relying on In re Alappat, 33 F.3d 1526 (Fed. Cir. 1994) and Arrhythmia Research Tech. Inc. v. Corazonix Corp., 958 F.2d 1053 (Fed. Cir. 1992)(holding that transformation of heartbeat signals corresponds to a useful, concrete or tangible thing). However, in a concurring opinion citing In re Warmerdam, 33 F.3d 1354, (Fed. Cir. 1994)(data structure representing object merely a manipulation of abstract ideas), Administrative Patent Judge Dixon distinguished those cases and AT&T Corp. v. Excel Communications Inc., 172 F.3d 1352 (Fed. Cir. 1999)(adding billing data to telephone record is useful, non-abstract result) as each disclosing an invention well-grounded in an area of the technological arts. Judge Dixon noted that the specification was silent as to any media beyond a graphical representation, which could be "as broad as a stick in the sand." Judge Dixon further stated that the claimed invention did not involve the traditional sciences and hence there can be no advancement of the "useful arts" consistent with Congressional power under the Constitution.

For a copy of the decision and/or more information on USPTO examination policies for business method patents, contact the author of this issue of "APLF Patent Law Updates," Tim Wall (WallT@tkhr.com), at Thomas, Kayden, Horstemeyer & Risley LLP in Atlanta, Georgia USA.

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