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Moving targets Featured

9:43am EDT July 22, 2002
Just days before the holiday shopping season began last Thanksgiving weekend, Amazon.com filed a temporary protection order against bookseller giant Barnes & Noble, charging B&N was violating Amazon’s patented methodology for e-commerce — one-click technology.

The case was eventually settled and B&N resumed online sales, but the implications of the action can’t be overlooked.

Everybody’s suing everybody on the Internet these days,” says J.T. Kalnay, an attorney at Ulmer & Berne’s e-law group.

That, Kalnay warns, is only going to get worse as business owners stumble over each other in a rush to protect the information, software and processes they use on the Internet to conduct business. Amazon’s technology essentially remembers customer profiles when they return to the site and allows them to purchase merchandise with a single click of a mouse without the burden of filling in a new profile every visit.

Ironically, it wasn’t that long ago (the 1970s) when the courts ruled that software was not patentable. But in a sweeping change of opinion, the courts reversed themselves in 1998, saying materials of the digital industry are drastically different these days and developers deserve some form of protection.

Amazon’s recent litigation is just one case in point. Another comes from a more unlikely source, John Benson. Benson isn’t well known in most circles, but he lays claim to the creation of fantasy sports games. Approximately 15 million people nationwide participate in fantasy games, from rotisserie baseball to fantasy football to fantasy hockey.

A few decades ago, Benson developed the Official Constitution of Rotisserie Baseball. On Feb. 4, he shocked the fantasy sports world with an unannounced FedEx package ordering Ron Shandler, head of www.baseballhq.com — and organizer of the largest baseball fantasy draft in the nation — to cease and desist his activities with all fantasy sports leagues.

Shandler was also ordered to remove all references to Benson’s rules — or any modifications of them — from his site. In the lawsuit, Benson claims full rights to the concept of fantasy sports, much in the way Amazon asserts its one-click technology can’t be duplicated by anyone else without paying royalties. Benson’s case has yet to be settled.

The issue of who owns what online is certainly not cut-and-dried, says Nicole Vickroy, also an attorney with Ulmer & Berne’s e-law group. While the information contained in databases is not patentable, the databases themselves are. Courts have held compilations of information are analogous to the phone book, which can’t be patented.

Says Vickroy, “You can’t just post whatever you want on the Internet. Right now, you better get permission first.”

But before you start pulling down every nonproprietary piece of information off your company’s Web site, there have been some clarifications of what can be patented.

“Specific machines, such as hand-held personal digital assistant devices that beam information to other machines, are patentable,” Kalnay says.

When in doubt, Kalnay suggests checking with your attorney or contacting the U.S. Patent and Trademark Office. And, though the laws remain ambiguous, the message is clear, says Kalnay.

“Basically, if you’re doing something on the Internet, protect yourself.”

How to reach: Ulmer & Berne LLP, (216) 621-8400

Dustin Klein (dsklein@sbnnet.com) is editor of SBN.