FITUG e.V. Förderverein Informationstechnik und Gesellschaft

FC: Has the U.S. Patent Office really reformed?

------- Forwarded message follows ------- Date sent: Wed, 21 Mar 2001 15:14:49 -0500 From: Declan McCullagh <declan@well.com> To: politech@politechbot.com Subject: FC: Has the U.S. Patent Office really reformed? Send reply to: declan@well.com

http://www.cluebot.com/article.pl?sid=01/03/21/1817201 Has the U.S. Patent Office Really Reformed? posted by vergil on Wednesday March 21, @12:50PM from the extraordinary-claim-needs-extraordinary-proof dept.

According to a brief article in today's Wall Street Journal entitled "Fewer Patents on Methods Get Clearance," the U.S. PTO "has drastically reduced the pace of issuing controversial business-method patents, by setting up bureaucratic roadblocks that have angered some information-technology investors." Is this claim significant? Has the U.S. government truly reformed its habit of granting patents to business methods? I think the answer's "No" for two reasons.

What exactly is a "Business Method Patent?"

Most tech-savvy folks -- particularly journalists -- use the phrase "business method patent" as a blanket perjorative applying to patents on Internet processes, software and methods of doing business. The terms "business method patent," "software patent" and "web patent" are used interchangably in the vernacular to refer to the recent flood of perceived broad and obvious patents having something to do with the Internet.

However, when a representative of the U.S. PTO says "business method patent", he's referring to a specific classification of patents - Class 705 "Data processing: Financial, Business Practice, Management, or Cost/Price Determination." The drastic reduction in business method patents mentioned in the WSJ article almost certainly refers to Class 705 issuances exclusively.

The two most frequently mentioned examples of allegedly obvious business method patents (Priceline's name-your-price patent and Amazon's one-click patent) are members of Class 705. Yet most of the Internet-related patents lambasted daily in the press and discussion forums like Slashdot are not Class 705 -- British Telecom's "Hyperlink Patent" falls under Class 711, Microsoft's patent on style sheets is designated Class 707, and Apple's "Multiple Theme Engine" patent is Class 345.

The U.S. PTO has made some progress in applying greater scrutiny to the torrent of business method patents. A new, comprehensive website has been set up, and a "Business Methods Patent Initiative" launched. Unfortunately, these measures -- including second review and expanded mandatory searches -- are limited to Class 705 patent applications. I've seen little evidence that the U.S. PTO's newly implemented "bureaucratic roadblocks" have weeded out potentially broad, non-novel and obvious patent applications that fall under classifications other than 705. One such example may be Microsoft's recently granted (Jan. 16, 2001) patent 6,175,833 that seems to claim the venerable concept of running automatic web-polls.

Exporting American "Innovation" Abroad

While the U.S. PTO struggles to reform its examining procedures, and members of Congress propose potential solutions (such as the Business Method Patent Improvements Act of 2000), at least one other branch of the U.S. government -- the Office of the U.S. Trade Representative -- appears to have been laboring to ensure that other nations adopt the controversial American practice of granting patents to business methods. (USTR is the federal agency charged with negotiating and enforcing America's trade positions with other nations.)

For instance, consider the following excerpt from a October 24, 2000 Memorandum of Understanding "on Issues Related to the Protection of Intellectual Property Rights Under the Agreement Between the United States and Jordan on the Establishment of a Free Trade Area":

"5. Jordan shall take all steps necessary to clarify that the exclusion from patent protection of 'mathematical methods' in Article 4(B) of Jordan's Patent Law does not include such 'methods' as business methods or computer-related inventions."

U.S. government representatives took a similar negotiating position in a March 2, 2001 "expert level" meeting between "United States and Japanese government officials." According to a fact sheet on the USTR website:

"The United States urged the Japanese Government to take a number of measures in this area, including ... clarifying its laws to ensure that the personal use exception for copying is not abused in the digital environment; and protecting business method patents."

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