Board Sustains Examiner in Ex Parte Fletcher as Modification of Prior Art is Obvious, Predictable for Benefit of Increased Speed

September 2, 2011 – Blog Post

In Ex Parte Fletcher (Appeal No. 2009-007416 of Application No. 11/002,930), the issue before the Board was whether the Examiner erred in rejecting Claims 1, 3, and 4 under 35 U.S.C. §103(a) as unpatentable over Kocher (U.S. Patent Publication No. 2003/0061150) and Official Notice. The Board affirmed the Examiner’s rejection.

Independent Claim 1 recited the following: A method of conducting on-line business, comprising: providing a database that associates set prices with values of parameters relating to specific classes of non-fungible used goods; providing an interface through which a seller accesses data from the database to determine a set price at which an on-line reseller will purchase a particular non-fungible good; and the reseller operating an automated purchaser that issues a firm offer to purchase the non-fungible good at the set price, before physically examining the good wherein the firm offer needs nothing further than acceptance to create a binding contract.

The Appellants contended that the rejection of Claim 1 is improper because Kocher fails to teach that the automated purchaser “issues a firm offer to purchase the non-fungible good at the set price … wherein the firm offer needs nothing further than acceptance to create a binding contract.” In particular, Appellants argued that Kocher’s paragraph [0104] does not describe a “firm offer” that “needs nothing further than acceptance to create a binding contract,” and that having the price “backed” by a Blue Book price, as recited in paragraph [0104], does not correspond to a firm offer. Additionally, the Appellants noted that Kocher discusses issuing a tentative offer to purchase a non-fungible good at a proposed price, then revalues the price after an appraisal, and then depending on the results of the appraisal, facilitates a negotiation between the buyer and the seller. Finally, the Appellants argued that Official Notice (i.e., that it was well known in e-commerce to inspect an item only after the purchase is complete) was correct with respect to the sale of fungible goods, but incorrect when applied to non-fungible goods.

The Board analyzed the Kocher reference and noted that although in Kocher a customer is connected to a reselling website where Appraisers are used to determine how close an estimate was to the reselling price, and then a value determination site updates its database accordingly, Kocher also describes “an alternative embodiment” in which a value is extrapolated, and then the price estimate is provided via the value determination site. The Board also noted that Kocher states that “[t]his would be similar to a ‘Blue Book’ price for a large spectrum of things and the price is backed by an instant offer to sell for that price,” which is consistent with a “firm offer to sell” before physical examination of the goods, as recited by Claim 1.

The Board also did not find the Appellants’ argument with respect to Official Notice persuasive. First, the Board noted that no traversal of the Official Notice was presented in the May 9, 2007 response, which was filed subsequent to the February 20, 2007 Office Action asserting Official Notice. Thus, the Board concluded that the Appellants did not traverse the Official Notice in the “proper time frame as required.” Next, the Board indicated that Appellants acknowledged that Official Notice is correct when applied to fungible goods, and further discussed that it would have also been obvious to one of ordinary skill to “extend inspection until after purchase to non-fungible goods as well to increase the speed of completing a transaction with such goods.” Thus, the Board concluded that “[t]he modification of the process of Kocher to have inspection of the non-fungible goods occur after purchase is considered an obvious, predictable modification to increase the speed of completing a transaction with such goods.”

Consequently, the Board sustained the Examiner’s rejection of Claims 1, 3, and 4 under 35 U.S.C. §103(a) as unpatentable over Kocher and Official Notice.