Software And Business Model Patents are different

Over at techdirt’s article about the Amazon decision, there is some confusion about the relationship between software patents and business model patents. I posted a comment to try to clear it up.

Business Method patents and Software patents definitely have a significant overlap, but they are not the same thing, at least in Canada, and this decision of the Patent Appeal Board does not have any significant bearing on software patents.

The leading case on software patents in Canada is Schlumberger Canada Ltd. v. Commissioner of Patents, (1981) 56 C.P.R. (2d) 204 (FCA), in which the Federal Court of Appeal considered a patent on a process of analyzing mining information using a computer. Mathematical formulae are not patentable, and the court found that using a computer to perform the calculation is not enough to make the process patentable. The Supreme Court declined to hear the appeal, so the law in Canada is clear that software is not patentable. In practice, however, lots of patents are filed in Canada that are effectively software patents, and it is an area of some controversy.

So the leading case regarding software patents in Canada is clearly not about business methods. They are often related, but should not be confused.

Note that this decision of the Canadian Patent Appeal Board in the Amazon.com case is a lower level decision than the Federal Court of Appeal decision ruling against software patents in Schlumberger. We’ve seen that IP owners have still found ways to get software patents. We should not be too confident that this decision will stop business method patents either.

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One thought on “Software And Business Model Patents are different

  1. Dale B. Halling says:

    All error correction codes, all encryption schemes and all patern recognition schemes are just a computer performing a calculation. These are all very important area’s of technology for an information economy. It is hard to see the logic of excluding these areas of technology from patent protection.

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