Net Patents Process Receives an Overhaul

SAN MATEO (04/03/2000) - THE U.S. PATENT and Trademark Office (PTO) last week detailed a new initiative to address industry criticism over its practices for issuing Internet-related business method patents, which some argue are too broad-based and monopolistic.

The Business Method Patent Initiative outlines plans for industry outreach and quality control by the PTO, including better technical training for examiners.

It also calls for expansion of current searches for "prior art," which is PTO-speak for instances in which an invention existed prior to a patent claim, invalidating the claim.

According to Don Pelto, patent attorney at McKenna and Cuneo, in Washington, the initiative is a step in the right direction. He pointed to the initiative's mandate of a second review for all Internet and business method patents, which he said could reduce the number of patents issued erroneously.

However, Gregory Aharonian, editor and publisher of the Internet Patent News Service, disagreed.

"[The] consensus is that the proposed changes will have little effect," Aharonian wrote.

Some controversial patents have been issued, including several for Amazon.com, which came under fire for its one-click shopping patent and its patent covering its affiliates program. Priceline.com is also involved in litigation with Microsoft's Expedia over its patent on name-your-own-price auctions.

The PTO issued 399 Internet-related business method patents last year, which is more than double the 182 in 1998, according to Brigid Quinn, the PTO's deputy director of public affairs.

But according to Henry Petri, patent attorney at the law firm Howrey Simon Arnold & White, in Washington, the PTO's new initiative will affect patent quality.

"I don't think it's going to decrease the number of patents issued, but I think it's going to improve the quality," Petri said.

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