Software patent litigation: Billions in costs for companies

US initiative takes up the fight against software patents

Archive notice: This article was originally published on March 3, 2008. Links and embedded videos are preserved as part of the historical record.

According to pressetext, litigation over software patent infringements costs US companies 11.4 billion dollars annually. This was revealed by the US software initiative End Software Patent (ESP) in its first annual report. Companies outside the IT sector are increasingly affected by software patent lawsuits. “Software patents burden the US economy and create a resource crisis at the US Patent Office,” says ESP head Ben Klemens. Software patents put innovation in particular at risk.

Around 55 software patent lawsuits are filed each week, the Public Patent Foundation estimates. Increasingly, the companies affected do not operate in the software sector, but their websites infringe software patents through the use of certain configurations, for example, ESP says. As an example, the initiative cites patent exploitation company Global Patent Holding, which is demanding sums of between seven and 15 million dollars from corporations including Caterpillar, Kraft Foods and ADT Security Services. In each case, the reason is a dispute over the design of the individual companies’ websites. In total, ESP has a list of more than 50 companies outside the IT industry that are currently being sued for infringement of a software patent.

Unlike in the USA, there are no patents on pure software within the EU. “European patent law excludes the patenting of computer programs in principle,” Rainer Osterwalder, spokesperson for the European Patent Office, explains to pressetext. So-called computer-implemented inventions (CIE), meaning inventions realised with the help of computer programs, are patentable, however. As these patents also relate to a field that develops particularly quickly, there is a correspondingly small number of opposition and appeal proceedings, Osterwalder says. Relatively short product cycles, a patent granting period of just under four years and a patent term in the CIE field of three to six years also make it difficult to conduct decision-making proceedings lasting years.

ESP was officially launched yesterday, Thursday, and aims to eliminate software patents that do not protect technically innovative changes. On the one hand, the non-profit group wants to advise companies fighting software patent lawsuits. On the other, ESP wants to carry out public education work that is ultimately intended to lead to legislation against the patenting of software. The initiative was founded by the Free Software Foundation, the Public Patent Foundation and the Software Freedom Law Center.

Further information:

  • US software initiative End Software Patent (ESP)
    Europ