[Patents] harbinger

[Jim Bessen" <jbessen@researchoninnovation.org (Jim Bessen)]

The following appears in today's New York Times, suggesting that the EC may
be coming down on the side of maintaining limits on software patents and no
business method patents:

http://www.nytimes.com/2001/10/06/business/worldbusiness/06PATE.html?ex=1003
379311&ei=1&en=fd8087d0f42d3a9d

New Software Patent Law for Europe Looking Limited

October 6, 2001

By PAUL MELLER




BRUSSELS, Oct. 5 - The European Union appears to be moving
toward unified regulations for software patents that would
be less encompassing than regulations in the United States
and Japan.

Competition officials at the European Commission, the
executive arm of the 15-nation union, met Wednesday with
their colleagues in charge of drafting a new law for the
union, to press their case for limiting its scope. Their
concern is that overly protective patent regulation could
hinder competition by helping large software manufacturers
maintain their dominant positions.

A person involved in the discussions said the concerns of
the competition officials had been met. "We haven't agreed
on a final position, but I don't anticipate any further
difficulties in getting the draft directive approved within
the commission," he said.

The approach being adopted by the commission would allow
patents only for software of a technical nature, and it
would not permit patents on business methods. The United
States and Japan allow patents on a much wider range of
software applications, and they both permit patents for
business methods.

Software of a technical nature would include, for example,
applications that increase the processing speed of a
personal computer. Business methods include innovations
like one-click purchasing, for which the online retailer
Amazon (news/quote) received a patent in the United States
in 1999. Amazon used the patent to get an injunction
against use of a similar purchasing feature by a rival,
Barnesandnoble.com, but that injunction was lifted by an
appeals court this year pending a trial.

"The United States has swung far too far toward granting
patent protection," said Thomas Vinje, a lawyer in the
Brussels office of Morrison & Foerster, which represents
several information technology companies. He said the
appeals decision in the Barnesandnoble case was a swing
back to the more sensible approach being adopted in Europe.


"The commission appears to be taking a wise approach to the
software patent law," he said. "They will have come under
considerable pressure to come up with something more in
line with the United States and Japan. But I am glad they
appear to have resisted."

Those favoring greater scope for patent protection argue
that Europe's failure to adopt more protective regulations
has harmed software innovation in Europe by denying the
protection innovators need to get financial support for
their ideas.

The European Union committee of the American Chamber of
Commerce in Belgium has urged the commission at least to
permit business methods to be patented.

"Some would argue that in Europe, where there is a narrower
view of what can be patented, economic opportunity from
software invention is limited," said Thaddeus Burns, a
lawyer with the Brussels office of Akin, Gump, Strauss,
Hauer & Feld. Europe's approach to patent law, he said, has
encouraged some software engineers to seek better returns
from their work elsewhere.

The software patent law for all of Europe about to be
introduced by the commission follows a yearlong
consultation process with the software industry and the
open source software community, which develops
nonproprietary computer code. The proposed directive
appears to be following the less restrictive approach of
the existing individual laws in place in the 15 countries
of the European Union, the person involved with the
discussions said.

The European Patent Office can register patents for every
country in the European Union. But the system is expensive
because applicants have to pay each country's national
patent office to exercise their protection in that country,
Mr. Burns said.


Jim Bessen