Ex Parte Hagmeier et al - Page 5

                 Appeal 2007-2169                                                                                        
                 Application 10/068,369                                                                                  

                 “computer” is a device used for computing (see Webster’s New World                                      
                 Dictionary, Third College Edition, 1988, p. 286).                                                       
                 3.   Kawan discloses a smart card with a microprocessor. Col. 3, ll. 25-                                
                 47. (See also Fig. 1; “a credit card-sized plastic card embedded with                                   
                 microcomputer 6 [see Fig. 1] having memory to set up and securely store at                              
                 least one merchant loyalty register,” col. 4, l. 67 – col. 5, l. 3.)  A loyalty                         
                 program application can be stored in the card’s memory. See col. 2, ll. 40-                             
                 44; col. 5, ll. 19-21 (referring to Fig. 2); col. 5, ll. 46-47; and col. 6, ll. 9-11.                   
                 A user’s transaction information can also be stored on the smart card                                   
                 microcomputer.  Col. 2, ll. 23-26.  The card can be inserted at a terminal at,                          
                 for example, a point of sale, to update the loyalty points that accumulate in                           
                 the smart card upon completing each merchant transaction. Col. 6, ll. 40-55.                            

                        C. Principles of Law                                                                             
                 Claim construction                                                                                      
                        “The Patent and Trademark Office (“PTO”) determines the scope of                                 
                 claims in patent applications not solely on the basis of the claim language,                            
                 but upon giving claims their broadest reasonable construction ‘in light of the                          
                 specification as it would be interpreted by one of ordinary skill in the art.’                          
                 In re Am. Acad. of Sci. Tech. Ctr., 367 F.3d 1359, 1364 [70 USPQ2d 1827,                                
                 1830] (Fed. Cir. 2004).”  Phillips v. AWH Corp., 415 F.3d 1303, 1316, 75                                
                 USPQ2d 1321, 1329 (Fed. Cir. 2005).                                                                     
                 Obviousness                                                                                             
                        “Section 103 forbids issuance of a patent when ‘the differences                                  
                 between the subject matter sought to be patented and the prior art are such                             
                 that the subject matter as a whole would have been obvious at the time the                              

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