[Patents][Free-sklyarov-uk] Scotsman article, 12 June

[James Heald <j.heald@ucl.ac.uk>]

An article from the Scotsman last Thursday, by Paul Carlyle, a partner
at commercial law firm Shepherd & Wedderburn specialising in
intellectual property and telecommunications law.

Spot the mistakes!


http://www.thescotsman.co.uk/business.cfm?id=647292003

American disputes are patent folly

... [discussion of the Woolston vs Ebay case snipped] ...

Might we see the same problems in Europe? The US patent system has
always been less robust in its exclusion wording than the UK equivalent.
The UK Patents Act repeats wording from the European Patent Convention
specifically excluding "a scheme, rule or method for doing business".
The same provision is found in other European Convention states. By
contrast, the US approach has always been to rely heavily on excluding
"discoveries" as opposed to "inventions", an approach that is open to
varying interpretation.

However, the UK has always had a tendency to follow the lead set by our
American cousins. As with the development of patents over software, the
UK and Europe has a problem. If Europe continues to offer more limited
patent protection, the "brain drain" to the US becomes hard to avoid and
so European citizens will not benefit from the innovations these people
create.

The European Commission consultation on patenting software, published
last year, revealed most to be against any extension of patents to
business methods. Even the draft Software Patent Directive, currently
being finalised, seeks simply to codify the current position rather than
extend patent protection.

The European approach seems justified. The US experience is not pretty.
Business method patents seem to be a charter for speculative patent
applications and "ransom" litigation. The spectre of a court order
preventing use of a major business technique is probably enough to make
most companies pay up. Some estimates suggest 26 per cent of Ebay’s
business operates through the disputed business method. Commentators use
words like "extortion".

Woolston has previously run two successful cases against other companies
and is in the midst of another as well as the threatened appeal from
Ebay.

But as the legal position settles down, commentators will turn from
attacking the current disruption to reviewing the economic benefits that
can or are being derived from wider patent protection. If concerns are
raised about the US economy using its more flexible patent system to
extend its lead over European companies, European conservatism may
become harder to defend.