Business methodology (or business method) patents are now accepted for examination in the U.S. Patent & Trademark Office as a result of the recent case State Street Bank & Trust Co. v. Signature Financial Group, Inc., which held that methods of doing business can be patented as “processes” and that a computerized system for managing mutual fund investment information was patentable subject matter.

This recent decision represents what many consider a significant change in the law and has profound implications for anyone involved in starting or growing an e-business.

A number of the pioneers in e-commerce have already demonstrated the value of obtaining patents for key business methods. For example, Jeffrey P. Bezos of Amazon.com is co-inventor of U.S. Patent 6,029,141 on a method entitled “Internet Based Customer Referral System.” This patent enables individuals and other business entities to market products over a merchant’s website in return for a commission, and has become known in the popular press as the “one click” patent. The competitive advantage to Amazon.com resulting from the granting of the “one click” patent is incalculable. Amazon.com has successfully sued at least one other online e-tailer, and likely has deterred a number of others from using what may be the most streamlined method for taking orders over the Internet.

A number of our clients are now developing new e-commerce models for more traditional lines of business, especially those related to information processing or professional services. For example, brokerage services are readily operated as e-businesses over the Internet, and such businesses must rely on efficient, streamlined, novel ways of interacting with clients or customers, thus distinguishing themselves from the competition. When developing a website and methods customers will use to access and manipulate information over your website, it is likely that one or more novel business methods will be developed and implemented. Anyone who uses your website is likely to figure out a substantial portion of your novel method and may be tempted to copy it. Often, latecomers copy a competitor’s website content, page for page, changing only that portion of the HTML files required to identify the latecomer’s own business. Copying web pages is an especially tempting way to minimize costs and steal ideas, since computers are ideally suited to make perfect copies of material posted on the Internet. A business methodology patent with claims to your method for gathering, disseminating, and using information over the internet can be a powerful tool for discouraging competitors from stealing your novel business methods.

Additionally, a business methodology patent can be an important part of an interlocking set of intellectual property rights, making a thorny and difficult proposition for anyone trying to simply steal your web site or homepage concept, images and text. A business methodology patent complements copyright rights, which arise once the web page content is set down in a tangible medium, such as a file stored on your server.

A business methodology patent may also complement trademark rights in an e-business. For example, if your website has a particular convenience feature or a particularly fun way to interact, you may choose a catchy trademark to describe that feature (such as “one click”) thereby building equity for your business in both trademark rights and patent rights, as they pertain to the novel feature.

The ability to exclude others provides protection for investors seeking to develop new business methodologies and new ways of doing business on the Internet. Without the intellectual property protection afforded by business methodology patents, trademarks and