In this decision, the European Patent Office refused to grant a software patent on the concept of replicating the handling and redemption of paper-based vouchers with an electronic voucher scheme. Here are the practical takeaways of the decision T 1031/14 (Electronic vouchers/I-MOVO) of 3.12.2019 of Technical Board of Appeal 3.5.01:
This European patent application generally relates to cash value vouchers. According to the description, there is a long history of consumer-oriented businesses using printed cash value vouchers as a promotional tool to retain existing customers and to attract new ones. However, paper-based vouchers suffer from high up-front costs (producing the vouchers, handling), and also consumers increasingly dislike carrying paper vouchers with them. Lastly, paper vouchers of high face-value carry a significant financial risk as advances in copying technology has made it easier to reproduce vouchers fraudulently.
The invention therefore concerns replacing paper-based vouchers by an e-voucher scheme, which is able to work with existing point-of-sale equipment. The overall goal of the invention was to closely replicate how tokens are handled today and effectively dematerialise the token and redemption process.
Here is how the invention is defined in claim 1:
Claim 1 (main request)A method for authorising the redemption of cash value vouchers using an ISO/IEC 7812-1 and/or ANSI X4.13 compliant POS terminal comprising the steps of providing a cash value voucher comprising an alphanumeric number and having a cash value, which cash value is not related to the number, entering said number at an ISO/IEC 7812-1 and/or ANSI X4.13 compliant POS terminal, the POS terminal forming a concatenated string comprising said number, POS terminal identifier and an issuer identification number and sending the string to an acquirer, which acquirer after validating the string sends the string to the issuer, characterised in that the voucher number has 6 to 10 digits and the POS terminal has a software program installed and preconfigured to add the issuer identification number to the voucher number numbers wherein the issuer authenticates the voucher number and amends the string such that the string now comprises the cash value, POS terminal identifier and the issuer identification number, which amended string enables authorisation of payment for the value of the cash value, the amended string being transmitted via the acquirer to the POS terminal to authorise the redemption of the voucher for the cash value.
Is it technical?
First of all, the board briefly addressed the question of patent-eligibility, which was no problem due to the presence of technical means in claim 1:
The claim is directed to a mix of technical and non-technical features. The Board does not dispute that the method according to claim 1 appears in a technical context. The method can be considered to be performed by technical means, because it involves an ISO/IEC 7812-1 and/or ANSI X4.14 compliant POS terminal with means for storing data, means for processing data and means for transmitting and receiving data, and, therefore, has technical character. Accordingly, the claimed subject-matter is an invention in the sense of Article 52(1) EPC (see T 258/03 “Auction method/HITACHI“).
But of course, the challenging test was that of inventive step:
However, the question of inventive step requires an assessment of whether the invention makes a technical contribution over the prior art. Features which do not make such a contribution cannot support the presence of an inventive step (see T 641/00 “Two identities/COMVIK“, Headnote I). The assessment of inventive step in the decision under appeal considered D7 to be the closest prior art.
Accordingly, the board assessed which of the features of claim 1 actually contribute to the technical character of the invention, and came to the following conclusion:
The Board agrees that the following features outlined in point 9.2 of the decision per se pertain to an administrative method, i.e. to the non-technical part of claim 1:
– providing a cash value voucher comprising an alphanumeric number and having a cash value, which cash value is not related to the number, forming a concatenated string comprising said number, terminal identifier and an issuer identification number and sending the string to an acquirer, which acquirer after validating the string sends the string to the issuer, the voucher number having 6 to 10 digits,
– the issuer authenticates the voucher number and amends the string such that the string comprises the cash value, POS terminal identifier and the issuer identification number, which amended string enables authorisation of payment for the value of the cash value,
– the amended string being transmitted via the acquirer to authorise redemption of the voucher for the cash value.
The appellant’s argument that the claimed e-voucher scheme was indeed technical did not succeed:
What the application itself calls “an e voucher scheme” (see e.g. page 1. last par. of the description) is regarded by the Board as an administrative business related concept of distributing, validating and authorising vouchers. The Board does not agree with the appellant’s argument that such a voucher scheme cannot be carried out with pen and paper (see point 6 of the statement setting out the grounds of appeal). It is an abstract concept to issue a voucher not related to a cash value, adding an alphanumeric number, POS ID and issuer ID, validating by an acquirer, authenticating by an issuer to comprise cash value, POS ID and issuer ID, handing it back to the acquirer, who transmits the voucher for authorisation to a dealer. The idea of not providing the voucher value together with the voucher and distributing vouchers without the notion of an account or balance is a business scheme and does not involve technical considerations. The possibility of making different pricing schemes possible is a direct consequence of the business idea. This scheme could be carried out in a conventional way without involving electronic means. It therefore does not contribute to the technical character of the invention.
Also the technical implementation of the e-voucher scheme was not found to involve any helpful technical aspects:
The contribution of the invention does not lie in an improved POS infrastructure for redeeming cash value vouchers. The technical infrastructure used according to claim 1 is that of an ISO/IEC 7812-1 or ANSI X4.14 compliant POS terminal with means for storing data, means for processing data and means for transmitting and receiving data such as a networked general purpose computer, which were common general knowledge before the priority date. The contribution lies rather in the way of associating information with existing transaction data such as cash value, POS ID, issuer ID. Such data, however, in the Board’s view, is not technical, since it is cognitive data, not functional data (see T 1194/97 Data structure product/PHILIPS, OJ EPO 2000, 525).
The appellant had argued that the concatenated string comprised cognitive and functional data and gave an example of a voucher redemption request and a corresponding response message. The appellant also cited a standards-related document that showed that certain fields could not be changed in the response message. According to the appellant, these fields represented functional data, without which the system would not understand the messages. This was said to be analagous to the functional data in T 1194/97 (supra), without which the operation of the television system would be impaired.
But also this argument did not convince the board:
However, the example of a voucher redemption request presented and the changes made to the string therein do not reflect features of claim 1. According to the wording of the claim, the string is amended such that it comprises the cash value, POS terminal identifier and the issuer identification number. These are fields of cognitive data and they do not interact with the system to produce a technical effect as was the case in T 1194/97. They merely enable a business scheme. No further implementation details are given in the claim, in particular it is not specified what the messages look like. Even if the appellant was right with regard to the specific example, which the Board doubts, there is no corresponding concrete feature in claim 1, which could be considered when assessing inventive step.
In the end, therefore, the board decided that in the absence of any technical contribution beyond the straight-forward computer-implementation, claim 1 of the main request did not involve an inventive step. The appeal was dismissed.
You can read the whole decision here: T 1031/14 (Electronic vouchers/I-MOVO)
Patrick is a European patent attorney at BARDEHLE PAGENBERG. He specializes in software patents in Europe both from a prosecution and litigation point of view.