Amazon’s One-Click Patent in Europe and Elsewhere

Amazon’s so called “One-Click Patent” is one of the most controversially discussed software inventions ever. The term, which nowadays is used as a cipher for a prototypical business method patent, was originally coined for US 5,960,411 titled “method and system for placing a purchase order via a communications network” (filed 12 Sep 2007, granted 28 Sep 1999; pdf), which has been enforced against competitor Barnes & Noble and licensed to Apple.

The respective teaching enables easy Internet shopping in that a customer visits a website, enters address and payment information and is associated with an identifier stored in a “cookie” in his client computer. A server is then able to recognize the client by the cookie and to retrieve purchasing information related to the customer, who thus can buy an item with a “single click”.

EP Parent Application: The first “1-click” application in Europe, EP 0 909 381 A2, related to an Internet-based customer data system and claimed a “method for ordering an item using a client system“. The application has been withdrawn on 08 June 2001 in view of approaching oral proceedings that had been summoned by the Examining Division with a negative preliminary opinion saying that the claimed teaching was not inventive over prior art document D3 (Baron C: “Implementing a Web shopping cart”, Dr. Dobbs Journal, Redwood City, CA, 01.09.1997). During the proceedings, Dutch Internet bookseller BOL.COM supported the Examining Division by a number of third party observations according to Art. 115 EPC, all of which pointing the Examining Division to the relevance of D3 (see e.g. here or here).

First EP Divisional: EP 0 927 945 A2, being a divisional of parent application EP ’381, related to finding the postal address of the receiver of a gift and claimed a “a method in a computer system for co-ordinating delivery of a gift from a gift giver to a recipient“. This application has been granted on 23 April 2003 (EP 0 927 945 B1) after a telephone interview between the primary examiner and Amazon’s representative cleared the way. Then, during the hot phase of the debate on software patentability in Europe in connection with the  EU Commission’s so called “Software Patent Directive” (COM (2002) 92), the 1-click patent was opposed by flower deliverers Fleurop Interflora AG, the German Society of Information Sciences (GI), and the anti-patent group Foundation for Free Information Infrastructure (FFII).

The Opposition Division revoked the patent for new matter (Art. 123(2) EPC 1973) and lack of inventive step (Art. 56 EPC 1973). In the subsequent appeal before EPO Appeal Board 3.5.01 under experienced Chairman S. Wibergh (T 1616/08), the appealed decision was set aside but only a very limited third auxiliary request was remanded back to the Opposition Division for substantive examination (see here for claim language), while the claims according to the remaining requests were rejected for lack of inventive step (Art. 56 EPC 1973) without citing any prior art:

The Board agrees that the subject-matter of claim 1 is obvious. The problem underlying the invention is that at the time the order for the delivery is received the exact address of the recipient may not be known. Simply asking the recipient for his address is a non-technical step. Equally non-technical is the idea of having the vendor – rather than the purchaser – contact the recipient. Technical is therefore only the computer system itself and the means for communicating with the recipient, namely e-mail. But these technical means were well known at the priority date, and the invention simply uses them in a straightforward, conventional manner. [§ 4.2 of the grounds]

The Board does not deny that, as the appellant has pointed out, the claimed system is new (over the notorious prior art) and involves technical considerations. This is however not enough. Novelty is not denied and technical considerations do not necessarily have inventive quality. The only relevant criterion for inventive step is the one stated in Art. 56 EPC 1973, namely whether the invention is obvious to a person skilled in the art. Since in accordance with established jurisprudence this ‘art’ cannot be a field of business or administration, only elements of the solution falling within the competence of a technically skilled person [...] can be taken into account. [§ 4.3 of the grounds]

The Board’s approach to revoke the patent: The above passages of the grounds perfectly illustrate the EPO’s approach towards examining software-related inventions such as computerised business methods by the so called “extended problem solution approach” as developed, inter alia, in T 641/00 ”Comvik”. According to this approach a claim has technical character and thus represents patentable subject-matter pursuant Art. 52 EPC as soon as a computer or computer network is involved, whereas non-technical (e.g. purely business-related or organisational) features must not be considered for assessing inventive step.

Therefore, a computerised business method such as Amazon’s 1-click technology, may be novel over the notoriours prior art due to some technical features (e.g. using a computer system or e-mail) but will be immediately rejected for lack of inventiveness (Art. 56 EPC), since the technical features are known (and mostly trivial), while the “innovative” business features do not provide for a technical problem and thus do not contribute to inventive step.

Upon assessing inventive step, the underlying non-technical context of the claim derived from its business-relates features (the so called requirements specification), is per definitionem considered prior art even though it may be absolutely new and highly innovative. Thus, the non-technical features of a claim are not only ignored but even actively endanger the claim, since a skilled artisan would be directed towards the claim’s technical features by considering its non-technical feature.

Second EP Divisional: EP 1 134 680 A1, another divisional of parent application EP ’381, was rejected by the Examining Division due to lack of novelty (main request) and lack of inventive step (auxiliary requests) based on prior art document D1, which is the same Baron reference (“Implementing a Web shopping cart”) that has already brought down the parent application (see grounds).

In the subsequent appeal proceedings (T 1244/07), Appeal Board 3.5.01 again under S. Wibergh (preliminarily) agreed with the findings of the Examining Division in the summons to attend oral proceedings on 27 January 2011. In the decision, lengthy claim 1 of the first auxiliary request was assessed by the Board as the main request:

The Board therefore considers that the subject-matter of claim 1 differs from D1 in that the purchaser’s identification information is not inputted when ordering the item, but looked up in the customer table using the client identifier received from the client and that the “single action” indication is only sent if it is “enabled”. [§ 14 of the grounds]

These features can be seen to solve the two [...] problems [...] to reduce the number of user interactions involved in selecting items, which makes e-commerce easier, faster and more comfortable, and also to reduce the amount of sensitive information sent over the Internet, which may be intercepted. In the board’s view the skilled person would have tried to solve these problems because they are both explicitly mentioned [in] D1. [§ 15 of the grounds]

The Board further argued that

In order to read the sensitive data from the database, one would need a key that identifies the purchaser in question. In the Board’s view it would be self-evident to use the user identifier or cookie already available in D1 [and in D3, see § 17 of the grounds] to do this. The Board thus considers that the skilled person would have been led to modify the third embodiment of D1 to dispense with the need to input this data for every order and arrive at the situation [...] [in which] a user [...] would be given an indication in the form of a “Submit Order” button, which is an indication of a single action to order the contents of the shopping cart, i.e. the claimed single action to order an item. [§ 16 of the grounds]

Regarding the appellants argument that “enabling” the single action involves security considerations of the user, the Board added that

[...] this merely shifts the responsibility for the security to the purchaser who judges whether the single-action ordering should be enabled or not. [...] Such a decision relates to forms of human behaviour and thinking that fall under mental acts, which are excluded from patentability. According to the jurisprudence of the EPO (see e.g. G 3/08 at point 10.13.2) these cannot contribute to inventive step. Its implementation by means of a determination and a conditional sending step are clearly routine matters of design and also cannot contribute. [§ 18 of the grounds]

The Board consequently held that the main request and the auxiliary requests lack inventive step.

Third EP Divisional: Finally, EP 2 299 398 A1 is a divisional of EP ’680 filed on 01. October 2010, the very last day before the regulations of the “new” 2-year-time limit for filing EP divisionals (Rule 36 EPC) put an end such precautionary divisionals aiming at keeping the application alive (see here). Besides the issuance of the search report and search opinion citing well known prior art, no substantial steps have been made in this case.

United States: As outlined here earlier, US 5,960,411 has survived a reexamination by the USPTO essentially unchanged. The reexamination certificate dated 2 March 2010 confirmed the patentability of original independent apparatus claims 6 (client system for ordering an item) and 9 (server system for generating an order). Further, independent method claims 1 (method of placing an order for an item) and 11 (method for ordering an item using a client system) have been limited by a “shopping cart model”. However, the modified patent is still quite broad, since the “shopping cart” limitation is part of the leading e-commerce purchasing models anyway (see here or here).

Canada: On October 14, 2010, the Federal Court of Canada issued an appeal decision according to which the Canadian “1-click” counterpart comprises patentable subject-matter and the case was remanded back to the Patent Office for expedited re-examination (see here or here). The Court held that there was no legal basis in Canada to exclude business methods from patentability but that “mere business schemes” or “disembodied ideas” lack a “practical embodiment” and thus are not patentable. Considering theses criteria, the Federal Court held that Amazon’s invention qualifies for “art” under the Canadian Patent Act because

1. the system claims require a machine as an essential element of the invention and
2. the method claims are “put into action through the use of cookies, computers, the internet and the customer’s own action” and result in a “physical effect” on those elements.

Currently, the case is before the Federal Court of Appeal which recently heard arguments of both Amazon.com and the Canadian Attorney General (see here or here).

Australia: The Australian patent system provides a pre-grant opposition, which has been used by Australian telecom provider Telstra to oppose the AU counterpart application AU 762175. The decision was issued on 9 May 2011. As reported e.g. here and here, claims 3 and 62 to 141 (of 162 claims in total) were found allowable by the Delegate, since theses claims comprise an identifier (e.g. a “cookie”). This is an surprising result, since the Delegates explicitly considered the Baron reference that helped to render EP ’381 (EP parent) and EP ’680 (2nd EP divisional) obvious for its explicit mentioning of a user identifier or cookie.

Allowable claim 3, which is considered “the broadest surviving claim of any of the ‘1-click’ patent family members” by Australian patent attorney Marc Summerfield, reads:

A method for ordering an item using a client system, the method comprising:

1. displaying information identifying the item and displaying an indication of a single action that is to be performed to order the identified item; and
2. in response to the indicated single action being performed, sending to a server system a request to order the identified item,
3. wherein the server system uses an identifier sent along with the request to identify additional information needed to generate an order for the item, and
4. wherein the identifier identifies the client system and the server system provides the identifier to the client system.

Conclusion: The 1-click technology was first filed in 1998, meaning that 13 of 20 years patent term are over now. Considering the controversial character of the invention and the fact that this issue at least in Europe (examination of 1st and 3rd divisional), Canada (decision of the Federal Court of Appeal) and maybe in Australia (possible appeal) will stay on the agenda of some more years, Amazon’s competitors and other e-commerce operators are still not save.

The fact that Amazon may not be unhappy with the legal situations in the US and in Australia (and maybe also in Canada) and that three out of four EP applications were rejected/withdrawn and the fourth will probably not be granted either, again shows that the European approach towards software-implemented business methods is pragmatic and appropriate (see above under “The Board’s approach to revoke the patent”), since it ensures that only technical teachings are patented.

It remains to be seen if the different patent-eligibility requirements in the world (e.g. “technical problem/teaching” in Europe, “practical embodiment” in Canada, “machine or transformation / no abstract idea” in the US or “physical effect” in Australia), which according to my opinion all relate to the same core issue of an tangible technical implementation, may converge one day.