Monday, February 22, 2010

Business Method Monday - Advertising for E-Commerce

The PTO recently published modifications to the financial, business practice or management (former class 705/1) and discounts and advertising (former 705/14) portions of the class 705 schedule. PTO defined many new subclasses, and increasingly granular additional subclasses indented under them (also known as subclass arrays), to capture the wealth of new inventive concepts in these areas. Other significant changes to the class 705 schedule are underway and anticipated to be published in coming months.

Patent number 7,158,942 for an “Internet advertisement system” illustrates some of the changes to former subclass 705/14, which had covered both discounts and advertising. That has now been greatly expanded, renumbered and split into 705/14.1 (Discount or incentive (e.g., coupon, rebate, offer, upsale, etc.)) and its subclasses, and 705/14.4

Claim 2 of the “Internet advertisement system” states that “... at least one partner web site is at least one of a net-game provider, a chat room provider, and an e-commerce provider” – the 'e-commerce provider' clause puts this claim in 705/14.51, and PTO examiners designated this as the original (OR) classification for this patent. Subclass 705/14.51 pertains to advertising During E-commerce (i.e., online transaction). Because this subclass is indented under subclass 705/14.49 (Targeted advertisement), it is a form of targeted advertising. The 705/14.51 definition also specifies that “[t]he term “electronic transaction” covers a transaction wherein the user uses any kind of network having at one end a terminal to execute the transaction consisting of buying or selling goods or services.” Discounts or incentives provided during an electronic transaction could direct an invention claim to subclass 705/14.23 (During E-commerce (i.e., online transaction)), which is higher in the class schedule and could, therefore, be the mandatory classification depending on the claim language.

This patent is interesting in that illustrates several other new subclasses relevant to advertising for e-commerce sites. These classifications are either mandatory (required by the inventive material disclosed in each claim) or discretionary (provide useful additional information for search purposes and can be drawn from the claimed disclosure or other disclosed information such as the abstract, summary of the invention, or drawings) and can be referred to as cross-reference classifications. The cross-references applied by the USPTO to this patent include 705/14.61 and 705/14.73. Targeted advertising Based upon schedule (705/14.61) is captured in claim 4, stating that the invention “provide[s] a plurality of sets of advertisement banners to said at least one partner web site so as to be carried on the web page and switched on the web page as a set at predetermined time periods.” This meets the subclass definition for a “specific time or day that a promotion is going to be available or exposed to the public.”

The second cross-reference mentioned above is for an Online advertisement (705/14.73). The claim 1 phrase “advertisement banner providing means for providing said at least one partner web site with at least one advertisement banner among the plurality of advertisement banners stored in said first database” is covered by the definition for this subclass. The phrase 'banner advertisements' is key here – when encountered it should direct one to consider a 705/14.73 classification. Because of the broad nature of the definition for this subclass, where “a promotion is presented on the World Wide Web”, we might expect that this will be a very common mandatory or cross-reference classification for applications and patents dealing with e-commerce site ads.

The significant changes to the class 705 schedule and definitions make it imperative that inventors and applicants have a good understanding of the new level of detail being applied to classifying business methods patents and patent applications. This includes not only the schedule and definitions, but also the prior art in these new subclasses which USPTO uses, in part, to support or reject proposed new inventions. In previous posts Sean Henderson and I discussed risks associated with misclassification and inadequate prior art searches. Another lesson is . . . do your homework when USPC schedule changes are released.

Until next time . . .

Sunday, February 21, 2010

Xerox, Kleenex and Zamboni?

The Zamboni ice resurfacing machines is one of the added attractions of going to a hockey game or to the ice rink. Watching this elegant machine drive across the ice placing a new sheer surface on the ice is one of the highlights. I've been at events where the fans even cheer the Zamboni driver when the machine makes its way out of its game time hiding place.

The Zamboni Company now finds itself in the same situation as Xerox (a photocopier) and Kleenex (a tissue) before it. The company needs to work very hard to keep its trademarked product name from being turned into a noun. When that happens the IP world calls it trademark dilution. The 2010 Vancouver Olympic Games have got the people at Zamboni Company on the job.

Apparently the battery operated ice resurfacing machines built by the Zamboni Company's Canadian competitor, Resurfice Corp. failed to perform at the level of quality for olympic level elite competition. When there were delays in the events because of problems, the media reported it as being caused by the Zamboni rather than by saying it was caused by the ice resurfacing machines.'s article on the subject clarifies the situation as did articles in other media outlets. The article also reported on Charles Schulz's love of the Zamboni Machine which began in 1980. The Zamboni site includes some of the Peanuts cartoons featuring its product.

The National Hockey League even sells team machine pins and die cast models of them machines. As a die hard pin collector I'm disappointed the the Washington Capitals don't have their own Zamboni pin on their online store web site.

If you are a gamer, you can even drive the Zamboni in your NHL 2K9 game which features the Zamboni Achievement challenge that challenges you to clear the ice before the time runs out.

Check out Mr. Zamboni's early patent, 2,763,939 issued in September of 1956.

The bottom line, from an intellectual property perspective, it's bad for business when your product name becomes a noun. You need to protect your trademark. But for the rest of us who love the Zamboni Machine, we don't want it getting a bad rap because of a competitor.

Thursday, February 18, 2010

Where's My Application and Other Classification Insights

Today's inaugural Business Methods Monday post comes from Sean Henderson. Sean shares some of his insight into the US Patent Classification system and the risks to the inventor who doesn't understand how the patent classification drives where your application is examined. As noted in an earlier post, Sean and his partner in crime, Mike Bowman have reclassified over 11,000 patents and patent applications. The quality standard for their work required a accuracy score of 80% or better. Their work was in the 90 percentile range based on the discriminating review by USPTO Examiners. In short, these guys have an exceptional feel for the subject matter they have reviewed and where it belongs.

Here is Sean's first post.

By now everyone in DC/Virginia has hopefully dug out from the snow dump, amount dependent based on the track of the two colliding fronts in your area. Unlike Vermont, my home of 14 years, DC/Virginia does not have the snow removal equipment...nor can it be justified really, for what was modeled as a 15 to 25 year snowfall you just wait it out until the roads are cleared. Folks here, for the most part, don't run real snow tires on vehicles...nor seem to have figured out this whole stopping and speed thing versus reduced traction thing. That makes driving an interesting spectator long as you are not in the trajectory path of something you would rather avoid.

Michael Bowman and I have been asked to share some observations and mounting concerns that we have encountered, that anyone considering filing a patent application needs to aware of and seriously consider when preparing a patent application. The issues we discuss here are also valid and may have a more adverse impact for those of you whom have been issued what you believe to be a valid patent.

To date, Mike and I have analyzed and reclassified approximately 11,000 published patent applications and patents in Class 705 under a USPTO contract, plus many more that belong in what are loosely know as the computer based technology Classes, such as Class 700, 707, 709, 726, 718 etc., plus some in the mechanical systems and semiconductor manufacturing related Classes.

Reclassification projects at USPTO were driven by a need to provide additional subclass detail within one or more subclass arrays. The goal is to provide finer search granularity detail and to add subclasses for the new art being invented. Once the revised subclass schedule is agreed to, all documents with a Primary or Original Classifications within the one or more subclass arrays must be reclassified and assigned to the proper new subclass. (The Primary Classification is the class/subclass pair that appears in bold on the [52] U.S. Cl. section of a patent application. The Original Classification is the same bold class/subclass pair that appears on a granted patent.)

To classify patent applications and granted patents, each individual claim is classified based on the subject matter it discloses and assigned to a specific class and subclass where that subject matter resides. During classification cross-references to any other applicable class and subclass that apply, for future prior art search purposes are added. Classification of patent applications is done initially by USPTO Classifiers or contracted Classifiers. The Examiner may reclassify the application over the course of the examination, One of the most important things to know is that the primary classification assigned to a patent application as it drives which Group Art Unit at USPTO will examine the patent. For granted patents, it determines who is responsible for the care and feeding of those patents for the purposes of prior art research. The classification determines who will be examining your patent application and where you patent is assigned for the purposes of prior art and validity research.

Here is the problem…a significant number of the published patent applications and patents are misclassified. How significant? Well, wishing to be polite about this…no grading on the curve allowed…an “F” would be a very generous score. Worse, some of the patent applications and patents should never have been classified in the class selected to begin with, much less in the subclass. The real issue of concern is that the classifications and patent bibliography search history, the class/sub class on the patent, is where the Examiner will search for prior art. In many cases it would appear that no search was done for prior art in the classes and/or subclasses where similar claimed subject matter is classified. The Examiner and patent researchers may not always find the right art in the appropriate class. Acknowledging that the Examiner has a full plate, there also seems to be a lack detailed understanding by the Examiners regarding other USPC classes and subclasses outside of their Group Art Unit that include the same or related subject matter. In other cases the Examiner might not have understood what was being claimed which can also result in the patent being classified in an inappropriate classification.

There are some serious implications here. Let’s start by considering what I hope is apparent at this point to those of you considering filing a Patent Application. First, you absolutely need to do your own prior art search, or hire someone with the knowledge in the art to do that for you. There are lots of tools to help you do your searches.

At Coronado Group we use Cognition IP by Coronado Group Ltd, which employs a concept search in conjunction with the US and International patent classification schedules to help you understand where your patent application is likely to wind up when it is examined by USPTO. Using Cognition IP’s copy, paste, search interface, you can dump just the Abstract, any or all the claims, the description or an invention disclosure, or all of the above in as the “concept” to be searched. This returns the patents that are the closest to the text you entered to do your search. A single search looks across the whole published USPTO patent database. The search executes regardless of the subject matter allowing you to search outside your own subject matter expertise. To refine your search, you can add filters to the concept, including Boolean strings to help you do a comprehensive search before you finish writing your claims and filing your application.

Regardless of the tools you use, you need to do the search prior to application filing to determine if there are any published patent applications and patents, that predate and invalidate a part of, or all of your claims. And, you need to look across all of the art, not just subject matter within your comfort zone. There can be prior art in classes and subclasses where one would never expect to find the subject matter…and you need to be looking in all these areas.

Next there are implications here to consider for anyone who holds an issued Patent…or for that matter, for those who have a license agreement, or are paying royalties for the use of patented technology. You also want to be sure that the patents you are licensing are the definitive art covering your technology and products.

During my years working for IBM designing automated systems for their 200 and 300 millimeter ASIC semiconductor manufacturing lines, prior art was diligently searched any and all related art Applications or Patents that touched on what we were building on, were listed in the Application Disclosure. Basically, the research was done for the Examiner and you were directing the Examiner to all the know classes and subclasses that should be researched with the additional references to other published documents of interest. Said another way, by the time we were done, barring someone filing just ahead of us, or there being an unknown published document that negated claims, it was pretty well known up front that the art was indeed unique and should result in a issued Patent. This helped us avoid expensive litigation as well.

Being aware of how the US Patent Classification system works during the preparation and prosecution of your patent application will help insure that your invention is on track to be patented and that granted patents are only given for novel and non-obvious inventions.

We hope to continue sharing our patent experiences and sharing our insight on the risks and challenges of prosecuting a patent application as seen from the vantage point of having read and reclassified so many patents.

Wednesday, February 17, 2010

Business Method Mondays Inagural Post

Today marks the beginning of what we hope will be an interesting series of posts from Michael Bowman and Sean Henderson. Mike and Sean have a very deep understanding of what is buried in USPTO's portfolio of granted and pending business method patents. They worked classifying and reclassifying patents to support maintenance of the US patent classification system and helping define the appropriate definitions for each of the classes and subclasses where business method patents are assigned. Few people have the depth of knowledge across the spectrum of business method patents as Sean and Mike. I hope you enjoy their insights.

This is Mike's first post.

Welcome to this new blog series. As we await the upcoming US Supreme Court decision on the Bilski case, and its implications for patenting business methods we are introducing “Business Methods Monday”. Sean Henderson, and I will be writing on various topics related to issues surrounding the patenting of business practices (Class 705 in the US Patent Classification system). I'd like to thank Arleen Zank, Coronado Group, Ltd., for this opportunity.

Sean and I recently completed reclassifying more than 11,000 patents and applications in class 705 under contract to the USPTO. We worked on many more documents in a number of computer technology and chemical apparatus classes. Our analysis of 11,000 patents and applications revealed common issues:

Poor, Unclear Writing -- This is where the patent quality problem begins. Poor, unclear writing leads to misclassification of the initial application, which will result in that application being routed to the wrong USPTO Technology Center Group Art Unit for examination. When this occurs, the patent case then must be transferred to the proper unit, leading to potential delays for inventors, increased workload for USPTO staff, and risk that the invention is not reviewed in light of appropriate prior art.

Inadequate Research of Prior Art by Inventors and Examiners -- Given the tremendous volume of information in US and international patent databases, along with that to be found in the general and technical literature, on the Internet, trade publications, and academic work, prior art searching is a difficult task. There are many instances of disclosed information that does not appear to be unique, based on what we had reviewed in a particular subclass array of a class tree schedule. Inadequate prior art searches represent a very significant risk factor for inventors, if it is subsequently determined that the invention, or specific aspects of it, infringes upon previously patented inventions.

Misclassification of Applications or Granted Patents -- Either the invention is not reviewed in light of the prior art that it actually lies within (leading to risk that it is not unique and can be successfully challenged), or it is rejected because it is improperly classified and the examiner(s) do not adequately understand the inventive content (leading to risk that unique inventions are rejected and thus do not come to market). We observed a large percentage of misclassification because classifiers/examiners do not observe PTO’s own rules of classification, read very simplistically for keywords in the abstract and first claim or claim array, or place an invention with a specific subclass of prior art because "that's where we want it", not because that is where the invention belongs. This means that the subclass is not a good representation of the art in a particular area or that researchers won’t have a comprehensive view of the patent landscape.

Taken together, inventors and assignees face very significant risks in terms of being awarded a properly reviewed and classified patent. A key lesson to draw from this is that applicants should do as much thorough research on prior art, and provide well-justified proposed primary and cross-reference classifications, before submitting their invention to the USPTO. With the wealth of tools available for literature searching and patent analysis, including Coronado Group’s Cognition IP, well-researched applications and patents should be the rule.

I will be writing future posts in several areas. We will look at the process of patenting business methods inventions, including some of the fine points of revisions to the class 705 class tree schedule and definitions. We'll look at business methods topics of interest, including specific applications or patents. I’ll share what I learned reviewing thousands of business methods patents and applications.

Friday, February 12, 2010

One Design Patent and 200 Million Frisbees

Walter Fredrick Morrison, the inventor of the Frisbee has died. Mr Morrison's design patent, D183626, is elegantly simple for something as wonderful as the Frisbee. A single page with two simple figures. How could you get through college or enjoy a trip to the beach on a breezy day without one?

Mr. Morrison's invention, that was patented in 1958, grew out of his own beach adventures where he and his future wife tossed a cake pan back and forth. A tradition begins. Originally called the Pluto Plate, it was renamed the Frisbee by Wham-O, the company Mr. Morrison licensed his Pluto Plate to, because college students in New England were tossing the tins of the local Frisbie Pie Company.

The Wham-O site has a tribute to the inventor who let us all have a little fun with out electricity, chips, wires, or LEDs. Here is another interesting post on the Frisbee and its power to please.

Monday, February 8, 2010

Billion Dollar Breathable Shoes

Today's Wall Street Journal included an article about Mario Polegato, the inventor of breathable shoes. The article reveals that Mr. Polegato was at a wine convention in Reno, Nevada when he decided to go for a walk. As soon as he stepped out in the desert heat his feet started to bother him because the rubber soles didn't let the heat escape from his shoes. He took out his Swiss Army knife and cut holes in the soles of the shoes bringing immediate relief. His walk in the hot Nevada desert was the start of what is now a billion dollar foot ware company.

The rest is history. Mr. Polegato, vintner and shoe aficionado created Geox and its breathable shoes. Here is a link to his list of Mr. Polegato's inventions.