Amazon.com’s Canadian patent may be just “one-click” away

Amazon.com has won an important stage in a twelve-year battle in Canada over the patentability of its invention entitled “Method and System For Placing A Purchase Order Via A Communication Network”, which simplifies internet shopping by allowing consumers to buy things with a “single click” rather than having to proceed to a “check-out”.  When a consumer visits a website and enters his or her address and payment information, the information is stored in a “cookie”.  On the next visit to the website, the “server” is able to recognise the consumer and recall the purchasing information which means that the consumer can make a purchase with a single click.

In 2009, the Canadian Commissioner of Patents decided that Amazon’s September 11, 1998 application for a patent for a business method was bad for want of patentable subject-matter.  Amazon appealed the decision of the Commissioner to the Federal Court of Canada.  On 14 October, Justice Michael Phelan of the Federal Court of Canada overturned the decision of the Commissioner of Patents and sent the matter back to the examiner for expedited re-examination.  Justice Phelan found that the Commissioner had “fundamentally erred” and acted beyond her powers by adopting a policy which was not reflected in Canadian patent law. To access the full decision, click here.

At the core of the matter was the question of whether a “business method” is patentable subject matter under Canadian law.  Justice Phelan rejected the Commissioner’s finding that “business methods” are not patentable subject matter in Canada, and instead concluded that a “business method” can be patented in appropriate circumstances.

Justice Phelan relied on the American decision in Bilski v Kappos, in which the US Supreme Court stated that business methods are not necessarily unpatentable per se, but rather are subject to the same legal requirements for patentability as any other process or method (for our blog post on Bilski v Kappos, click here).  The Australian decision of Grant v Commissioner of Patents [2006] FCAFC 120 which found that the fact that a method may be a “business method” did not preclude it from patentability was also noted.

Importantly, Justice Phelan distinguished “business methods” from “business schemes” and found that in this case, the “one-click” technology was not a mere scheme or disembodied idea, but rather a practical application, “put into action through the use of cookies, computers, the internet and the customer’s own action”.

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