SYSTEM, METHOD AND APPARATUS FOR CONSUMER PURCHASE AND FUTURE DISTRIBUTED DELIVERY OF COMMODITY AT PREDETERMINED PRICES

• US 20080313070A1
• Filed: 02/12/2008
• Published: 12/18/2008
• Est. Priority Date: 02/12/2007
• Status: Abandoned Application

• Current Assignee: Pricelock, Inc.
• Original Assignee: Pricelock, Inc.
• Inventors: Painter, Scott, Fell, Robert M., Bonsignore, Michael R., Gros, Thomas D., Magnuson, Gary A., Reed, Brian P.
• Application Number:
  US12/030,012
• Publication Number:
  US 20080313070A1
• Time in Patent Office: Days
• US Class Current: 705/37
• CPC Class Codes: G06Q 10/08 Logistics, e.g. warehousing, loading or distribution; Inventory or stock management
• CPC Class Codes: G06Q 30/06 Buying, selling or leasing transactions
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange

Abstract

Embodiments disclosed herein provide a unique methodology as well as the overall architecture necessary to implement the methodology that can enable an entity to create and provide a consumer price protection product under the Forward Contract Exception of the Commodity Exchange Act. Even consumers who do not meet commodity-related regulation requirements such as the Eligible Contract Participant regulatory requirements may purchase such a consumer price protection product or a variation thereof to reduce or cancel out the risk or at least reduce the unpredictability in purchasing commodities such as motor fuels.

Claims

1. A method for providing commodity price protection to individual consumers, comprising:

requiring a consumer to pay a provider an amount in exchange for a right to take physical delivery on a quantity of a commodity at an agreed price per unit of the commodity at any time within a specified period without being affected by price fluctuations associated with the commodity during the specified period, wherein the specified period ends at an expiration date;

exposing the provider to unlimited upward risk of the price fluctuations associated with the commodity during the specified period;

exposing the consumer to unlimited downside risk of the price fluctuations associated with the commodity during the specified period;

specifying that the right to take the physical delivery on the quantity of the commodity at the agreed price per unit of the commodity at any time within the specified period is not transferable, assignable, or marketable;

requiring the consumer to take the physical delivery of the quantity of the commodity before and by the expiration date;

allowing the consumer discretion as to time and location of the physical delivery; and

where the consumer has not taken the physical delivery of the quantity of the commodity upon the expiration date, providing the consumer with a plurality of regulatory-compliant solutions.

2. The method of claim 1, wherein the plurality of regulatory-compliant solutions comprises returning an unused portion of the quantity of the commodity to the consumer in the form of cash, check, credit, or a combination thereof.

3. The method of claim 1, wherein the plurality of regulatory-compliant solutions comprises allowing the consumer to rollover an unused portion of the quantity of the commodity to a new consumer price protection contract with a specific termination date and mandatory delivery period.

4. The method of claim 3, further comprising specifying that only one rollover is allowed.

5. The method of claim 3, further comprising specifying that no inter-contract period is allowed.

6. The method of claim 1, wherein the plurality of regulatory-compliant solutions comprises requiring the consumer to pay liquidated damages.

7. The method of claim 1, wherein the plurality of regulatory-compliant solutions comprises allowing the consumer to take delivery of an unused portion of the quantity of the commodity at a retail price of the commodity, even after the expiration date.

8. The method of claim 1, wherein the plurality of regulatory-compliant solutions comprises allowing the consumer to take delivery of an unused portion of the quantity of the commodity within a range of agreed prices, even after the expiration date.

9. The method of claim 1, further comprising allowing the consumer to pay the provider over a network and monitor a usage of the quantity of the commodity via a Website maintained by the provider.

10. A computer-readable storage medium carrying program instructions executable by a processor to:

enable a consumer to pay a provider an amount in exchange for a right specified in a consumer price protection contract to take physical delivery on a quantity of a commodity at an agreed price per unit of the commodity at any time within a specified period without being affected by price fluctuations associated with the commodity during the specified period, wherein the specified period ends at an expiration date, wherein the consumer price protection contract exposes the provider to unlimited upward risk of the price fluctuations associated with the commodity during the specified period, wherein the consumer price protection contract exposes the consumer to unlimited downside risk of the price fluctuations associated with the commodity during the specified period, wherein the consumer price protection contract specifies that the right to take the physical delivery on the quantity of the commodity at the agreed price per unit of the commodity at any time within the specified period is not transferable, assignable, or marketable, wherein the consumer price protection contract requires the consumer to take the physical delivery of the quantity of the commodity before and by the expiration date, and wherein the consumer price protection contract allows the consumer discretion as to time and location of the physical delivery;

allow the consumer to monitor a usage of the quantity of the commodity via a Website maintained by the provider; and

provide the consumer with a plurality of regulatory-compliant solutions via the Website where the consumer has not taken the physical delivery of the quantity of the commodity upon the expiration date.

11. The computer-readable storage medium of claim 10, wherein the plurality of regulatory-compliant solutions comprises returning an unused portion of the quantity of the commodity to the consumer in the form of cash, check, credit, or a combination thereof.

12. The computer-readable storage medium of claim 10, wherein the plurality of regulatory-compliant solutions comprises allowing the consumer to rollover an unused portion of the quantity of the commodity to a new consumer price protection contract with a specific termination date and mandatory delivery period.

13. The computer-readable storage medium of claim 10, wherein the plurality of regulatory-compliant solutions comprises requiring the consumer to pay liquidated damages.

14. The computer-readable storage medium of claim 10, wherein the plurality of regulatory-compliant solutions comprises allowing the consumer to take delivery of an unused portion of the quantity of the commodity at a retail price of the commodity, even after the expiration date.

15. The computer-readable storage medium of claim 10, wherein the plurality of regulatory-compliant solutions comprises allowing the consumer to take delivery of an unused portion of the quantity of the commodity within a range of agreed prices, even after the expiration date.

16. A system for providing commodity price protection to individual consumers, comprising:

a processor;

a computer-readable storage medium accessible by the processor and carrying program instructions executable by the processor to;

enable a consumer to pay a provider an amount in exchange for a right specified in a consumer price protection contract to take physical delivery on a quantity of a commodity at an agreed price per unit of the commodity at any time within a specified period without being affected by price fluctuations associated with the commodity during the specified period, wherein the specified period ends at an expiration date, wherein the consumer price protection contract exposes the provider to unlimited upward risk of the price fluctuations associated with the commodity during the specified period, wherein the consumer price protection contract exposes the consumer to unlimited downside risk of the price fluctuations associated with the commodity during the specified period, wherein the consumer price protection contract specifies that the right to take the physical delivery on the quantity of the commodity at the agreed price per unit of the commodity at any time within the specified period is not transferable, assignable, or marketable, wherein the consumer price protection contract requires the consumer to take the physical delivery of the quantity of the commodity before and by the expiration date, and wherein the consumer price protection contract allows the consumer discretion as to time and location of the physical delivery;

allow the consumer to monitor a usage of the quantity of the commodity via a Website maintained by the provider; and

provide the consumer with a plurality of regulatory-compliant solutions via the Website where the consumer has not taken the physical delivery of the quantity of the commodity upon the expiration date.

17. The system of claim 16, wherein the plurality of regulatory-compliant solutions comprises returning an unused portion of the quantity of the commodity to the consumer in the form of cash, check, credit, or a combination thereof.

18. The system of claim 16, wherein the plurality of regulatory-compliant solutions comprises allowing the consumer to rollover an unused portion of the quantity of the commodity to a new consumer price protection contract with a specific termination date and mandatory delivery period.

19. The system of claim 16, wherein the plurality of regulatory-compliant solutions comprises requiring the consumer to pay liquidated damages.

20. The system of claim 16, wherein the plurality of regulatory-compliant solutions comprises allowing the consumer to take delivery of an unused portion of the quantity of the commodity at a retail price of the commodity or within a range of agreed prices, even after the expiration date.

21. The system of claim 16, wherein the plurality of regulatory-compliant solutions is in compliant with commodity-related regulatory requirements set forth by the Commodity Futures Trading Commission (CFTC).

22. The system of claim 21, wherein the plurality of regulatory-compliant solutions is in compliant with accounting standards established by the Financial Accounting Standards Board (FASB).