Patent Ruling Gives Hope for Innovation

OK, I have a great idea for a new business method patent. It's a system by which customers can select among a prebuilt list of goods or products, and then choose how they would like these products customized and enhanced. The system is extremely flexible and can be applied to everything from computers to hamburgers. I call it the "Have it your way" method. I can't wait to get this patent, and I fully expect to get it. After all, if it's possible to get a business method patent for a way to use a playground swing, this should be rock-solid. And, once I get it, I can send out the legal notices to all those computer manufacturers, burger royalty and others violating my extremely innovative idea. Before I submit my great patent idea, I think I'll catch up on some of my news reading. Hmm, the U.S. Court of Appeals rules against business method patents. Oh, well, there goes that idea.

Jim RapozaOK, I have a great idea for a new business method patent. It's a system by which customers can select among a prebuilt list of goods or products, and then choose how they would like these products customized and enhanced.

The system is extremely flexible and can be applied to everything from computers to hamburgers. I call it the "Have it your way" method.

I can't wait to get this patent, and I fully expect to get it. After all, if it's possible to get a business method patent for a way to use a playground swing, this should be rock-solid. And, once I get it, I can send out the legal notices to all those computer manufacturers, burger royalty and others violating my extremely innovative idea.

Before I submit my great patent idea, I think I'll catch up on some of my news reading. Hmm, the U.S. Court of Appeals rules against business method patents. Oh, well, there goes that idea.

Yes, it's true--another stake has been driven through the heart of the vampire that likes to suck the life out of innovation and technological growth, the business method patent. The court based its ruling on the old test of machine or transformation--that is, for a patent to be granted, it needs to be implemented on a specific machine or transform something.

This is, of course, bad news for all of the people and entities that have put forth stupid patent ideas during the last 10-plus years. And it's good news for those that actually innovate, including both big companies and small entrepreneurs.

I've long held that when it comes to software, patents haven't been helping any side of the equation. Some say patents help small innovators compete against big companies, but most large companies have giant arsenals of broad and ambiguous patents that can be easily used to crush any small innovator with a legitimate new idea.

And big companies have found that, while their patent arsenals can be used against legitimate innovators, they are of little use against patent trolls that don't make anything and exist only to use patents against companies that actually make things.

This appeals court decision will almost certainly make its way to the Supreme Court. And if the Supreme Court rules the same way that it did in 2007--when it held that obvious ideas are not patentable--bad patents could finally be heading toward extinction.

It's a little bit sad that we've had to rely on the courts to overturn the bad patent ideas of the last 15 years. It would have been nice if Congress had moved to protect real innovation or if the Patent Office had worked to grant only legitimate patents, rather than giving as many as possible to rake in application fees.

But I'm not one to look a gift horse in the mouth, so here's a big thank you to the courts. I'm looking forward to an era when true innovators can create interesting new products without the fear of running afoul of overly broad and obvious patents in the hands of giant companies or patent trolls.

And while it might have been nice to have my crazy business method patent, I realize that having it my way isn't good for innovation.