NEW YORK (NYT) -- How important will intellectual property be in
the new economy? "Excruciatingly important," said Glover Ferguson,
co-director of the electronic commerce program at Anderson
A case in point is the victory that the online bookseller
Amazon.com scored last month when it obtained a preliminary
injunction against Barnesandnoble.com. The injunction prevents
Barnes & Noble from using the one-click system patented by Amazon
that enables repeat online customers to place orders without having
to re-enter mailing and credit card information.
"This is going to put some real boulders in the way of the Barnes
& Noble checkout line system," said Kevin Rivette, co-author of
Rembrandts in the Attic, a new book from the Harvard Business Press
that proselytizes on the power of patents. "The lawsuit also has put
everyone else on the Net on notice."
Walter Hanchuk, a partner at the New York law firm of Morgan &
Finnegan, concurred, saying the ruling "clearly highlights the
importance of intellectual property in all technologies."
Intellectual property, in Rivette's view, is what is going to
separate many winners and losers on the Internet.
"When it's easy to put up a Web site, when it's easy to get
financial backing, this is where some of the shakeout is going to
happen," he said.
Much attention so far has been paid to the new wave of so-called
business-method patents on the Internet. But Mark Lemley, a
professor of law at the University of Texas, points out that the
scope of what can be patented is growing every day.
"There's a patent on a method for holding a golf putter," Lemley
said. "There's a patent on allocating assets in a divorce
settlement. This is a great expansion of patentable subject matter
beyond what has traditionally been the technological arts."
Rivette, who is chief executive of Aurigin Systems, a patent-
strategy consulting company, predicted that "one of the biggest
things that will occur in the next three to five years is the
proliferation of well-funded patent `factories.'"
Rivette said he had heard of about half a dozen such enterprises
modeled along the lines of Walker Digital, the controversial -- and
extremely successful -- patent-incubation venture that gave birth to
Priceline.com. The Priceline.com business is based on a patented
method for letting prospective customers propose a price for a
product or service, with the online order being filled if the seller
is willing to sell at that price. The patent is one of 30 received
by Walker Digital, which has another 300 patent applications
Like Walker Digital, which kept a very low profile until it
started Priceline.com, these ventures are stealthily amassing patent
empires that will become apparent only when they are ready to start
businesses, Rivette said. …