An Argument Against Business Method Patents Demonstrating That Algorithms Are Abstract and Business Methods Are Obvious

In the United States, the Patent and Trademarks Office and the Court of Appeals for the Federal Circuit are extending patent protection to the invention of new Internet business methods. The article argues that this discourages innovation and rewards existing monopolies. First, the article examines the leading case of Amazon.com v Barnes and noble.com Inc before considering the grounds on which the United States courts have concluded that business method software ought to be patentable. The author concludes that the courts have greatly expanded the concept of useful art to give protection to what are in fact abstract ideas. By doing so they have protected business methods in a way which the courts have refused to do in the past. Finally the author examines the nature of innovation on the internet, concluding that it is sequential, with each creator improving on the work of the previous product. Unlike other areas of innovation, there are not high development costs associated with this process. Hence, giving the inventor a monopoly through intellectual property rights is not needed to encourage innovation. The public has benefited from the weak protection given to intellectual property rights on the internet so that it is not in the public interest to strengthen that protection. Doing so will only give more power to software companies which are big enough to seek and enforce patent protection and will reduce rather than increase innovation.