Application No. 10/028,284, filed in December 2001, provides a fascinating window into the evolution of patent eligibility jurisprudence. This application – assigned to GE Financial and prosecuted by folks at Hunton and Williams – is still pending 23 years after its original filing date. Filed pre-Bilski and still pending post-Alice, the application claims a “waterfall tool” that analyzes financial product pricing by tracking how actual revenue “cascades down” from list price through various deductions (like underwriting errors, discounts, commissions, and bonuses) to arrive at the final “pocket price.”
The system integrates data from multiple sources, including actuarial, commission, and bonus systems, to identify and manage “revenue leaks” in financial products like insurance policies. The tool specifically measures metrics like underwriting error rates and premium leakages (caused by risk reclassification), and implements automated control plans when metrics hit predetermined trigger levels. I expect that in the decades since it was filed, these methods have become widely used in the industry.
Why is the application still pending?: This is one of the rare cases that folks complaining about the patent system can point to regarding zombie patent applications. The examiner has issued dozens of rejections, including 15 final rejections. The applicant took the case to the PTAB – and lost – and has kept the application pending by filing RCE-after-RCE. The most recent Request for Continued Examination (number 14) was filed in June 2024 after yet another final rejection on eligibility grounds. I should note here that I did not randomly identify this application bout identified it as one of the oldest applications still pending at the USPTO.
The claims (attached below) center on analyzing revenue leakage in financial products using a specialized “waterfall tool.” Key claim elements include:
- Receiving and formatting actuarial data, including standardizing time identifications and product names
- Generating a waterfall display showing revenue cascading from list price to pocket price
- Measuring specific metrics like underwriting error rates and premium leakages
- Calculating differentials to identify revenue leaks
- Implementing automated control plans when metrics hit triggers
The examiner maintains the claims are directed to the abstract idea of “analyzing a financial service product pricing process,” falling into both the “organizing human activity” and “mathematical calculations” categories of abstract ideas. The examiner argues the additional elements – computer processor, waterfall tool, display – merely apply the abstract idea using generic technology.
The applicant’s response focuses heavily on procedural arguments about the examiner’s failure to properly apply the 2019 PEG framework, and does not appear to develop substantive technical arguments about the invention’s eligibility. While the applicant mentions data standardization and formatting features, these points are raised primarily to argue the examiner improperly lumped technical elements into Step 2A Prong One rather than evaluating them under Prong Two. The response repeatedly emphasizes how the examiner’s approach of characterizing the entire claim as abstract “is at odds with the guidance” and prevents meaningful Prong Two analysis.
The comparison to Example 42 similarly centers on procedural disagreement rather than technological similarity. Though the applicant notes both cases involve data standardization, they focus more on arguing that the examiner’s distinction between technical and business problems “is not correct application of the example(s) provided by the U.S. Patent and Trademark Office.” The response could likely be strengthened by developing a more meaningful technical explanation of how the waterfall tool’s data standardization and visualization capabilities represent concrete technological improvements, rather than primarily arguing examination procedure.
Patent Term: The application’s 20-year term expired in December 2021, meaning any patent that issues would rely entirely on Patent Term Adjustment (PTA) for its remaining life. The PTA calculations here are complex but likely substantial, with multiple sources of adjustment, but A delays (USPTO failing to meet statutory deadlines for rejections) and B Delays (the application was pending for numerous years before the first RCE). The 2016-2018 unsuccessful appeal period does not count as USPTO delay since the examiner was affirmed.
Lots of folks have complained about the “zombie” nature of patent applications – their theoretical ability to persist through endless RCE cycles. This problem is somewhat constrained by the the interplay of by the PTA-adjusted patent term. The application here illustrates the mechanism: while pending 23 years through 10 RCEs, its potential enforceable term is likely down to about 3 years. So while prosecution continues, the potential patent term isn’t infinite. The ~27 year total life (if issued today) reflects these limitations.
- PTAB Affirmance: JJ0H52FXRXEAPX4
- Applicant Prior OA Response: M1UT899UWFYGM35
- Current Claims: M1UT899SWFYGM35
- Most Recent OA: M0CEEZA4WFYGX57