ArentFox Schiff Wins a Rare PTAB Decision Reversing Patent Examiner’s Subject Matter Eligibility Rejection in a Fintech Patent Application

In 2023, the Patent Trial and Appeal Board (PTAB) reversed examiners’ decisions in about 30% of appeals, and only in about 7% of appeals related to patent applications for business methods, which include financial technology (fintech) inventions.

The PTAB appeal process for fintech patent applications is so challenging because of the very strict subject matter eligibility criteria applied to these inventions by the US Patent and Trademark Office (USPTO) and deference on appeal to the examiner’s factual findings. Despite these challenges, ArentFox Schiff attorneys secured a rare PTAB decision reversing the examiner’s rejection of a patent application of fintech start-up, TrendSpider.

TrendSpider’s application, issued as the US Patent No. 11,935,118, is directed to a novel trading platform that has advanced financial charting and alerts functionality based on automatic, real-time tracking and analysis of financial instruments traded in a market. During the first round of prosecution, ArentFox Schiff attorneys were able to overcome a prior art rejection, but the examiner remained steadfast on a subject matter eligibility rejection, holding that the claims were not directed to an improvement to technology. Given that the art unit of the application is 3600, which is notorious for high rejection and abandonment rates, the examiner’s stance came as no surprise. In fact, one of the main challenges of prosecuting fintech patents is overcoming the subject matter eligibility rejection under 35 USC §101 in view of the US Supreme Court’s decision Alice Corp v. CLS Bank, which restricts patentability of certain business methods. 

The examiner alleged that the pending claims were directed to a patent-ineligible abstract idea (in this case, a mental process). ArentFox Schiff attorneys responded with an appeal highlighting aspects of the specification which demonstrated that the claims (1) do not constitute a mental process that can be practically performed in the human mind and (2) reflect an improvement in computer technology, allowing for faster and more efficient processing of financial information, among other benefits. 

In the appeal brief, ArentFox Schiff attorneys explained that modern trading is volatile and even a small delay in time will often result in missed trading opportunities. Therefore, the method and system claims require an analysis that cannot be practically performed in the human mind, as it requires a real-time analysis and the generation of automatic annotations by filtering all mathematically possible trend lines that can be annotated on the price charts being annotated. Neither one of these aspects (e.g., real-time performance or an analysis that accounts for all mathematically possible trend lines) can be performed within the human mind, or with pen and paper, in view of the speed and volume requirements. The PTAB found this argument persuasive, stating “[w]e agree with Appellant that ‘[t]he Examiner has failed to explain how the method [of] claim 1, or the system of claim 7, can be performed in the human mind . . . when these claims require a real-time analysis . . . by filtering all mathematically possible trend lines.’"

This case also highlights the importance of drafting strong specifications, particularly for fintech inventions, with emphasis on a technical problem/solution combination provided by the invention and the technical benefits of the invention. The Federal Circuit has instructed that statements in an applicant’s specification regarding a technical solution solved by the claimed invention must be given weight in the eligibility analysis. In particular, statements in the specification regarding any alleged technical improvements should be presumed to be true and are important to the determination as to whether a claim represents an improvement to technology. The appeal brief cited the specification, which described how traders and other financial market participants currently utilize software systems to aid in developing and executing trading strategies. ArentFox Schiff attorneys further reasoned that the claims are directed to a method that improves existing software systems. The PTAB agreed with this line of reasoning, stating “[w]e, therefore, agree with Appellant that representative claim 1 ‘effect[s] an improvement to the technology of computer user interfaces and address[es] a problem arising in the realm of computer-based financial management tools: the inability of a user of such tools to quickly and easily annotate price charts and generate financial alerts based on trigger conditions.’”

ArentFox Schiff is a market leader in helping clients to navigate the complex business and legal issues relevant to the software, information technology (IT), and fintech industries. Top technology, software, and financial companies turn to ArentFox Schiff for our depth of experience in the intellectual property law to assist them with protection of their technological innovations using patents, trademarks, and copyrights in the United States and worldwide. With dozens of registered patent attorneys, agents, and scientific advisors, having diverse technical backgrounds, ArentFox Schiff’s Patent group provides for a full range of services including patent procurement and counseling, opinion and transactional support, post-grant proceedings, and litigation.


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