- Patents Post Grant Blog - http://www.patentspostgrant.com -

Senator Urges USPTO To Tackle Software & E-commerce Patents

Posted By Scott A. McKeown On 1 May 2012 @ 4:10 In Business Method Patent Challenge | Comments Disabled

business method patents [1]Transitional Program for Covered Business Method Patents (TPCBMP)

The Transitional Program for Covered Business Method Patents, (TPCBMP) will be implemented by the USPTO on September 16, 2012. The new post grant option essentially provides that any “covered business method patent” may be challenged under the same procedures and standards applied in Post Grant Review (PGR) proceedings. The TPCBMP will sunset 8 years from implementation, hence the “transitional” label.

The major differences between PGR and TPCBMP [2] relate to patent eligibility and estoppel.

With respect to estoppel, PGR estoppel attaches to any ground that the petitioner raised, or reasonably could have raised during the PGR. On the other hand, TPCBMP estoppel is only limited to issues actually raised during the proceeding.

The legislation defines a “covered business method patent” in general terms, as follows:

a patent that claims a method or corresponding apparatus for performing data processing or other operations used in the practice, administration, or management of a financial product or service, except that the term does not include patents for technological inventions.

As can be appreciated, the definition of “covered business method patent” is of great interest to some of the leading U.S. innovators [3]. Recently, the Senator (Schumer D-NY) that introduced the TPCBMP to the patent reform legislation urged the USPTO to adopt a very liberal definition of “covered business method patent.”

In his letter to the USPTO (here [4]), Senator Schumer attempts to rebut the position of ”commenters” (which would include many major technology companies), arguing that:

[M]any of the problematic business method patents this program is intended to weed out are asserted against small businesses, especially internet startups. This program was designed to target problematic patents, regardless of the business identity of the party against whom they are asserted. The limitation commenters suggest is not only contrary to basic common sense and fairness, it is plainly refuted by the record [discussing argument that the TPCBMPs should be limited to financial industry].

.           .              .         .

The term “technological invention” should not provide a haven for clever lawyers. Arguments that the “technological invention” exception is broad are false. As stated in the legislative history, “Clever drafting of patent application should not allow a patent holder to avoid PTO review under [the program]. . . .many of the problematic patents this program targets involve practices that are in widespread use by companies through their digital platforms – an often-cited example is a patent for one-click check-out. A broad construction of the technological invention exception would exclude any patent that involved the internet, and would render the program effectively meaningless. For these reasons, the commenters’ suggestions to categorically exclude particular types of patents from the program should be rejected.

Yet, the proposed rules make clear that the USPTO is not proposing an exclusion of patents that involve the Internet (and would certainly disregard any such comment). In fact, such is explicitly stated in the Practice Guide for the Proposed Trial Rules:

The following claim drafting techniques would not typically render a patent a technological invention:

(a) Mere recitation of known technologies, such as computer hardware, communication or computer networks, software, memory, computer readable storage medium, scanners, display devices or databases, or specialized machines, such as an ATM or point of sale device.

(emphasis added)

Senator Schumer’s “clever lawyer” concern is more appropriately directed to those that will be attempting to shoe horn otherwise valuable, technological inventions into an overly expansive definition of “covered business method” come September 2012. That is to say, with virtually no meaningful estoppel, and a clear mandate by Congress to have such litigation disputes stayed in favor of TPCBMP proceedings, the USPTO would best serve industry innovators by erring on the side of caution [5].


Article printed from Patents Post Grant Blog: http://www.patentspostgrant.com

URL to article: http://www.patentspostgrant.com/lang/en/2012/05/senator-urges-uspto-take-on-e-commerce-software-patents

URLs in this post:

[1] Image: http://www.patentspostgrant.com/wp-content/uploads/2012/04/business-method-patents.jpg

[2] differences between PGR and TPCBMP: http://www.patentspostgrant.com/lang/en/2011/09/uspto-post-grant-cheat-sheet

[3] great interest to some of the leading U.S. innovators: http://www.patentspostgrant.com/lang/en/2011/11/scope-of-business-method-patent-challenge-to-be-decided-by-uspto#more-7581

[4] here: http://www.patentspostgrant.com/wp-content/uploads/2012/05/comment-schumer1.pdf

[5] the USPTO would best serve industry innovators by erring on the side of caution: http://www.patentspostgrant.com/lang/en/2011/08/business-method-patent-challenges-in-store-for-uspto

Copyright © 2010 Patents Post Grant Blog. All rights reserved.