If you are an inventor looking to protect an invention involving a method of Internet-based advertising, you need to be concerned. In the Ultramercial, LLC et al. v. Hulu, LLC, et al., decision, the U.S. District Court for the Central District of California held invalid just such a patent on the basis that it was attempting to claim an abstract advertising concept.
The inventions at issue (US Patent 7,346,545) are both expressly claimed as methods for distribution of products over the Internet and are clearly and unequivocably limited to use with the Internet, an Internet web site and interactive messages. Although the claim could be more explicit, it would also be reasonable to interpret many of the steps specified in the claims as Internet-implemented. Notwithstanding the express limitations tying the invention to an Internet implementation, the Court found that the claims were not "meaningfully" limited to machine implementation and, accordingly, did not pass muster under the machine prong of the machine or transformation test. The claims also failed the transformation test as well according to the Court.
The key take-away from this case is to make sure that your patent attorney carefully limits the claims of advertising methods to machine-implementation and also where possible include a clear "transformation" of data, and also to make sure that the invention is claimed as a "machine" as well as a method.
Here are claims 1 and 8 from the '545 patent (emphasis added):
1. A method for distribution of products over the Internet via a facilitator, said method comprising the steps of:
a first step of receiving, from a content provider, media products that are covered by intellectual-property rights protection and are available for purchase, wherein each said media product being comprised of at least one of text data, music data, and video data;
a second step of selecting a sponsor message to be associated with the media product, said sponsor message being selected from a plurality of sponsor messages, said second step including accessing an activity log to verify that the total number of times which the sponsor message has been previously presented is less than the number of transaction cycles contracted by the sponsor of the sponsor message;
a third step of providing the media product for sale at an Internet website;
a fourth step of restricting general public access to said media product;
a fifth step of offering to a consumer access to the media product without charge to the consumer on the precondition that the consumer views the sponsor message;
a sixth step of receiving from the consumer a request to view the sponsor message, wherein the consumer submits said request in response to being offered access to the media product;
a seventh step of, in response to receiving the request from the consumer, facilitating the display of a sponsor message to the consumer;
an eighth step of, if the sponsor message is not an interactive message, allowing said consumer access to said media product after said step of facilitating the display of said sponsor message;
a ninth step of, if the sponsor message is an interactive message, presenting at least one query to the consumer and allowing said consumer access to said media product after receiving a response to said at least one query;
a tenth step of recording the transaction event to the activity log, said tenth step including updating the total number of times the sponsor message has been presented; and
an eleventh step of receiving payment from the sponsor of the sponsor message displayed.
8. A method for distribution of products over the Internet via a facilitator, said method comprising the steps of:
a first step of providing a product list on an Internet website, wherein at least some of the products are media products covered by intellectual property rights protection and are available for purchase, said media products being provided by content providers, wherein each said media product is comprised of at least one of text data, sound data, and video data;
a second step of selecting a sponsor message to be associated with at least one of said media products, said sponsor message being selected from a plurality of sponsor messages, said second step including accessing an activity log to verify that the total number of times which the sponsor message has been previously presented is less than the number of transaction cycles contracted by the sponsor of the sponsor message;
a third step of restricting general public access to said media products;
a fourth step of offering to a consumer access to a requested media product available for purchase without charge to the consumer on the precondition that the consumer views the sponsor message;
a fifth step of receiving from the consumer a request to view a sponsor message in response to said step of offering;
a sixth step of facilitating the display of a sponsor message to the consumer in response to receiving the request;
a seventh step of, if the sponsor message is not an interactive message, allowing said consumer access to said requested media product after said step of facilitating the display of said sponsor message;
an eighth step of, if the sponsor message is an interactive message, presenting at least one query to the consumer and allowing said consumer access to said media product after receiving a response to said at least one query;
a ninth step of recording the transaction event to the activity log, said ninth step including updating the total number of times the sponsor message has been presented; and
a tenth step of receiving payment from the sponsor of the sponsor message displayed.
For more information on this case visit my blog at www.patents4software.com
Steve