Law 897: Robert Teel's

Assignment for Oct. 30, 2008

Internet Business Method Patents

 

Patent Law Background Information

  1. •If you have not already taken Patent Law, the Federal Judicial Center has prepared a 17-minute video designed for jurors in patent jury trials. The video contains useful background information on the US patent system.  Watch the video with its accompanying sample patent.

  2.   

  3.    QuickTime   

  4.    Real Media   

  5.    Windows Media Player

  6. •Neustel Law Office has a helpful introduction to patents. Skim this material and familiarize yourself with these concepts.

  7. •Optional: If you run across any topic that is unfamiliar to you as you read the rest of this assignment, see Frequently Asked Questions (and Answers) about Patent




Internet Business Method Patents (IBMPs) Background

  1. •Until 1998, all business method patent (BMP) applications (of which IBMPs are a hybrid) were treated as unpatentable subject matter under 35 USC § 101.

  2. •Read Subsection II.A, and II.B, in Nicholas A. Smith, Business Method Patents and Their Limits:  Justifications, History, and the Emergence of a Claim Construction Jurisprudence, 9 Mich. Telecomm. Tech. L. Rev. 171 (2002), available at http://www.mttlr.org/volnine/smith.pdf.

  3. •Additionally, read the State Street opinion with particular emphasis on the section titled “The Business Method Exception.”

  4. •Treaty Considerations: Read the Overview of the TRIPS agreement and the section on patents. Does “any invention” require patent protection for IBMPs or does “industrial applicability” narrow the scope of patentable subject matter?

  5. •With the fall of the judicially-created BMP exception, the floodgates opened for IBMPS. What exactly is an IBMP? The first four pages of “Internet and E-Commerce Patents” by Bradley C. Wright has some brief examples of IBMPs.  Here are some additional examples in detail:

  6. •Amazon.com has been an IBMP lightning rod

  7. •Amazon 1-Click: Method and system for placing a purchase order via a communications network - Patent number: 5,960,411

  8. •Another Amazon Patent Furor: this patent covers an Internet-based customer referral system

  9. •Priceline.com: Using your own business assessment, try to anticipate which aspects of Priceline are patented. Now scroll to the bottom of Priceline.com and note some of its disclosed patents.

  10. •Web Concern Gets Patent for Electronic Business Model

  11. •Method and apparatus for a cryptographically assisted commercial network - Patent number: 5,794,207. 

  12. •Method and apparatus for the sale of airline-specified flight tickets - Patent number: 5,897,620

  13. •Conditional purchase offer management system - Patent number: 6,085,169

  14. •Conditional purchase offer (CPO) management system for packages - Patent number: 6,553,346



IBMP Controversy and Policy Considerations

  1. •Because many IBMPs rely on software as a primary means of implementing a claimed invention, the tech community has criticized some IBMPs as hampering software innovation and free-riding on donated work. Tim O'Reilly has sent Amazon an open letter disapproving of the use of the one-click patent. Do you find these criticisms compelling? Is there anything unique about these arguments vis-á-vis other types of patentable subject matter? Do you think the IBMPs are somehow more likely to create a “proprietary wasteland” than say, patents on the human genome?

  2. •Read Section I, “Policy Considerations Behind Business Method Patents” in Smith, supra, available at http://www.mttlr.org/volnine/smith.pdf.  Set aside for a moment any perceived or actual problems with the US patent policy and consider the policy arguments for and against IBMPs. Do we need IBMPs?

  3. •As a matter of Constitutional and statutory interpretation, do you think IBMPs (or patents on the means of competing, i.e. “creative arts”) were ever intended?  Should IBMPs Exist? (just read the first section). Do you agree with the argument that IBMPs are inherently suspect because of the difficulty in objectively verifying their [beneficial] outputs?



Going Forward: Proposed Changes to IBMP Policy

  1. •If we should have IBMPs (or if it does not look like they are going away), what would an ideal IBMP patent policy look like?

  2. •No change necessary? Perhaps our current patent system is fine both in terms of granting “quality” patents as well as invalidating poor patents.

  3. • Read: The Business Method Myth, by John R. Allison and Emerson H. Tiller.

  4. •Can third-parties and individual organizations police bad patents effectively?

  5. •EFF Patent Busing Project

  6. •Amazon 1-Click patent rejected

  7. •But would it help if the government or industry provided third parties more incentive to invalidate bad patents? Patent Bounty Hunters.

  8. •Legislative & categorical reforms

  9. •Refer back to the subsection II.A. on “Congressional Responses” in The Business Method Myth, by Allison & Tiller, (note § 273 of the First Inventor Defense Act). Should we include exceptions for prior users rights in some categories of patents and not others? Consider for a moment whether it makes sense to treat BMP differently than other patents, or whether we should maintain a one-size-fits all patent approach. A Method for Reforming the Patent System addresses this overarching issue.

  10. •Should the USPTO sort this out with better patent examination procedures? Do you think this is a viable option? Refer back to the subsection II.B. on “PTO Responses” in The Business Method Myth, by Allison & Tiller.

  11. •Skim this USPTO whitepaper which outlines new examination procedures

  12. •USPTO attempts to improve prior art database

  13. •Can the Court of Appeals for the Federal Circuit reign in business method patents? Should it?

  14. •Bilski: Full CAFC to Reexamine the Scope of Subject Matter Patentability




Return to the syllabus

 

USPTO at night by Rory Finneren