Publications
Business Methods Patents: There’s Method to this Madness
Imagine that you go into work, pick up your mail, and discover a letter
from CompuGlobal Mega Hypernet. The fine folks at CompuGlobal are taking
the time to inform you that if you don’t start giving them a percentage
of your sales, they will be forced to sue you for infringing the claims
of their patent. “A patent, you think to yourself, what are they talking
about? I just run a widget sales store. I’m not in the business of
inventing anything or stealing anybody else’s inventions.” Alas, but you
are, because CompuGlobal has gotten a business method patent, by which
they have patented the idea and method for electronically keeping track
of customer’s purchases and providing bonus “points” that can be
redeemed for exciting prizes, and just last month you instituted such a
system for your top widget buyers, and now you find your business “in a
pickle”.
Small and large business owners alike increasingly face this type of
situation, and it is the basis for much of the criticism that has
recently been leveled at these patents, and against the U.S. Patent and
Trademark Office (USPTO) for granting them. One illustration, widely
criticized as an alleged abuse of the patent system, is Amazon.com,
Inc.’s patent on “one-click” buying. A key concern is that this patent
provides an opportunity for the patent owner to foreclose other Internet
retailers from commercializing a system by which customers can select,
pay for, and ship products with a single mouse click. Critics believe
that this invention provides protection for an obvious idea, and stifle
competition in the Internet marketplace.
situation, and it is the basis for much of the criticism that has
recently been leveled at these patents, and against the U.S. Patent and
Trademark Office (USPTO) for granting them. One illustration, widely
criticized as an alleged abuse of the patent system, is Amazon.com,
Inc.’s patent on “one-click” buying. A key concern is that this patent
provides an opportunity for the patent owner to foreclose other Internet
retailers from commercializing a system by which customers can select,
pay for, and ship products with a single mouse click. Critics believe
that this invention provides protection for an obvious idea, and stifle
competition in the Internet marketplace.
In response to the criticism, Congress has taken steps to protect “prior
users” of patented business methods from being held hostage by a later
inventor’s patent claiming “bread and butter” operations. In addition,
proposed legislation in Congress would establish, as a less costly
alternative to litigation, an administrative (USPTO) opposition
procedure for attacking business methods patents by competitors.
users” of patented business methods from being held hostage by a later
inventor’s patent claiming “bread and butter” operations. In addition,
proposed legislation in Congress would establish, as a less costly
alternative to litigation, an administrative (USPTO) opposition
procedure for attacking business methods patents by competitors.
Despite the criticism, business method patents can be an effective means
for a family business to secure its rights to its business innovations,
and to inform the world about the innovations your business is making in
exchange for the right to exclude others from practicing your patented
method for a period of time.
for a family business to secure its rights to its business innovations,
and to inform the world about the innovations your business is making in
exchange for the right to exclude others from practicing your patented
method for a period of time.
So what is a family business owner to do? Review your business practices
for any innovations that the business has made, whether they relate to
enhancing marketing opportunities, increasing sales volume, enhancing
inventory tracking, ordering, shipping, or lending value to other
business tasks. Consider patenting your innovation to enable you to
prevent others from using the same method unless they negotiate a
license with your business. In addition, keep abreast of all
technological advances within your industry, so that you are aware of
what competitive patents might be of concern to your family business
“down the pike”.
for any innovations that the business has made, whether they relate to
enhancing marketing opportunities, increasing sales volume, enhancing
inventory tracking, ordering, shipping, or lending value to other
business tasks. Consider patenting your innovation to enable you to
prevent others from using the same method unless they negotiate a
license with your business. In addition, keep abreast of all
technological advances within your industry, so that you are aware of
what competitive patents might be of concern to your family business
“down the pike”.