the power plants at a fixed price, thus isolating the power plants from the possibility of a
spike in demand increasing the price of coal above the fixed price. The same provider
buys coal from mining companies at a second fixed price, thereby isolating the mining
companies from the possibility that a drop in demand would lower prices below that
fixed price. And the provider has thus hedged its risk; if demand and prices skyrocket, it
has sold coal at a disadvantageous price but has bought coal at an advantageous price,
and vice versa if demand and prices fall. Importantly, however, the claim is not limited
to transactions involving actual commodities, and the application discloses that the
recited transactions may simply involve options, i.e., rights to purchase or sell the
commodity at a particular price within a particular timeframe. See J.A. at 86-87.
The examiner ultimately rejected claims 1-11 under 35 U.S.C. ยง 101, stating:
"[r]egarding . . . claims 1-11, the invention is not implemented on a specific apparatus
and merely manipulates [an] abstract idea and solves a purely mathematical problem
without any limitation to a practical application, therefore, the invention is not directed to
the technological arts." See Board Decision, slip op. at 3. The examiner noted that
Applicants had admitted their claims are not limited to operation on a computer, and he
concluded that they were not limited by any specific apparatus. See id. at 4.
On appeal, the Board held that the examiner erred to the extent he relied on a
"technological arts" test because the case law does not support such a test. Id. at 41-
42. Further, the Board held that the requirement of a specific apparatus was also
erroneous because a claim that does not recite a specific apparatus may still be
directed to patent-eligible subject matter "if there is a transformation of physical subject
matter from one state to another." Id. at 42. Elaborating further, the Board stated:
2007-1130 3