Patenting Business-Methods

It was the growing use of computers in business that forced the courts to decide once and for all in 1998 whether business methods could be patented, and indeed, many patented business methods involve the use of computers to do business on the Internet, sometimes referred to as “e-commerce.” The aftermath of the 1998 court decision was a flood of business-method and e-commerce patent applications, which quickly created problems for the United States Patent and Trademark Office (USPTO).

Under the Patent laws, if an invention has been used in commerce or described
in literature for more than a year before a patent application for that invention
is filed, it cannot
be patented because the invention is no longer
new. With regard to a business method, a vast amount of information must be
examined to determine if the business-method is patentable. Because of the
vast amount of literature that might reveal that an invention is not new (called
the “prior art”), it was very difficult for patent examiners,
particularly those not well versed in computer technologies, to review all
of the prior art to determine whether an invention was in fact new. This is
especially true in a field that is experiencing rapid growth, change and progress.
Accordingly, the USPTO has been widely criticized for issuing business-method
and e-commerce patents for methods that have already been in extensive use
or that are obvious extensions of existing business methods. This has forced
the USPTO to adjust its process with respect to business-methods to accommodate
a rapidly evolving patent landscape.

In 2000, the USPTO responded to the concerns of the business community by announcing an action plan for business-method and e-commerce patents. In the plan, the USPTO sought to establish formal customer partnerships with the software, Internet, and e-commerce industries; provide a forum to discuss concerns and issues presented by e-commerce patents and their possible solutions; and solicit industry input in identifying sources of prior art. The USPTO also sought to enhance the quality of its review of prior art by providing additional technical training for patent examiners, revise the examination guidelines for computer-related inventions, and expand the scope of prior art search into additional databases. In addition, the USPTO has instituted a second level of review for business-method and e-commerce patent applications.

Presently, the USPTO maintains a separate Web site for business methods that reflects its efforts to improve its approach to the review of business-method and e-commerce patent applications. The Web site contains links for industry partnership meeting newsletters, questions and answers from a business partnership meeting, guidance for preparing a business-method patent application, examples of business-method patent rejections, training materials for computer-implemented inventions, business-method white papers, and other resources that specifically address business-method patents.

If you believe you may have a new business method or if believe a current business method patent should be challenged, please contact one of our patent attorneys to review your legal options.

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