Amazon's new Appstore feature could be patent suit bait
The patent was a cause of controversy in the technology world after Amazon went to court against rival Barnes & Noble, which was using a similar purchasing system on its Web site. The two companies reached a settlement over the issue in 2002. Separately, Apple signed a licensing agreement with Amazon to include it in its own products in 2000.Several years later, the United States Patent and Trademark Office ordered a re-examination of the patentupon the request of a New Zealand actor named Peter Caveley, who cited prior art. That led to a rejection of a few of the patent's claims, and several amendments by Amazon. In March 2010, the USPTO passed the 1-Click patent through the re-examination process, with the stipulation that it's tied to a virtual shopping cart. "Amazon built a substantial business around that innovation, and licensed it to major players including Apple," said Erin-Michael Gill, the managing director and chief intellectual property officer at MDB Capital Group. "Apple is using that innovation to make it easier for developers' apps to be purchased on iTunes. That's how the system is supposed to work."By comparison, Gill says that Lodsys' current strategy seeks the same ends, but is going about it in a potentially destructive manner."Because it appears that Lodsys is attempting to leverage the inefficiencies in the patent system to extract royalties -- apparently looking to settle with developers that don't have the resources to defend themselves, for just under the cost of litigation --there ends up not being this virtuous cycle of innovation promoting further innovation," Gill said. "This leads to the entire ecosystem going on the offensive."A still from Amazon's promotional video of its in-app purchase feature.AmazonLodsys patents under attackThere have been notable efforts to keep app developers out of harm's way when using built-in APIs, as well as get all of Lodsys' patents invalidated. Apple, whose developers were some of the first to be targeted, sent a letter to Lodsys last May, saying it was "undisputedly licensed to these (patents)," adding that app makers were protected under its licensing agreement. Lodsys publicly rebuffed that letter, saying that Apple was mistaken. The firm then proceeded to file a lawsuit against several additional app developers, and send similar licensing requests to Android developers.Related storiesHow much is that patent lawsuit going to cost you?Scoop: Bounty set for invalidating Lodsys patentsApple throws weight behind devs on patent issueiOS app makers targeted in patent spatAfter its own developers were targeted, Google responded last August by filing a request with the United States Patent and Trademark office seeking a re-examination of two of the four Lodsys patents. That process is still on-going, though since then there have been no newly filed suits against Android developers.Seemingly separate from both of those efforts was one launched last year from Article One Partners, a business that crowd-sources intellectual property research. It offered a reward to the party that found prior art, or examples of pre-existing technologies or other IP that could be used as evidence to invalidate one or more of Lodsys' patents. All three of those studies were completed successfully, resulting in $15,000 worth of prize money being doled out to three researchers."When folks like Microsoft, Apple, and now presumably Amazon start pulling together and pooling resources to really dig into these assets, every little nuanced issue becomes critical," Gill said.
