Apple, Starbucks Sued Over Music Gift Cards

Trintech writes "A Utah couple acting as their own attorneys have filed a lawsuit against Apple and Starbucks over the retailers' recent Song of the Day promotion, which offers Starbucks customers an iTunes gift card for a complimentary, pre-selected song download. In a seven-page formal complaint, James and Marguerite Driessen of Lindon, Utah say they developed in 2000, and were granted a patent in February 2006 for, an Internet merchandising utility dubbed RPOS (retail point of sale). The concept, which forms the heart of the infringement lawsuit, would allow gift cards for pre-defined items that can be sold at a brick-and-mortar store but used online; customers could redeem a card for a dining room set or a DVD, for example."

Its a new invention because its online

[by Anonymous Coward]

Same old rubbish. Companies have been giving away free gifts and vouchers for free gifts for years, tacking on "on the internet" doesn't make it a new invention in anyway shape or form.

Re:Its a new invention because its online

[Brian Gordon (987471)]

If they had patented the original idea of a "gift card" that would let you buy vouchers with purchasing power, and big players picked up their idea and started making millions then I'd be a little more sympathetic. But come on, this is obviously an example of prior art, and you're right- why tack on "...on the internet" other than just to dodge the prior art bullet a bit.

I must rush out

[Chrisq (894406)]

And patent it with "using wireless communications" added.

Re:

[dattaway (3088)]

And patent it with "using wireless communications" added.

Too bad you left out "encryption" in your wireless communication patent. It would be a shame if everyone redeemed their valuable gifts without encryption at Starbucks...

Re:

[twistedsymphony (956982)]

Because it's speficially for "Point of Sale" (POS) items. Which specifically refers the the items within reach of the checkout lane, like the candy at the grocery store, they keychains and tire pressure gauges at the auto parts store, or the cds/gift cards at starbucks.

XBL subscription and point cards aren't sold at the "point of sale"

Re:Its a new invention because its online

[Zeinfeld (263942)]

XBL subscription and point cards aren't sold at the "point of sale"

No, but top up cards for pay as you go cellular plans have been sold at POS since the mid 90s.

Yet more free prior art consulting...

There are lawyers who have tried to convince me that I can do more for the industry by helping them sink bogus patents than by actually like inventing stuff or writing books on how to stop Internet crime. Unlike some folk here I do accept that software can be patentable, but thats not the problem, the problem is the junk patents that should never have been applied for or granted.

Junk patents devalue genuine ones. They also mean that every few weeks we have another slashdot story where IBM or Microsoft have patented the wheel or such like, almost certainly as a defensive move, but once the patent is granted it can be used for anything.

Re:

[twistedsymphony (956982)]

I'm not condoning the patent at all, I'm simply explaining why MS wasn't named in the lawsuit. It could also be because with the subscription and points card you're not actually redeeming them for a physical item, similarly phone cards are selling a service as opposed to a item, the patent uses physical items as an example.

Re:

[Bombula (670389)]

Does that mean my patent for using a gift certificate while ordering products over the phone is no good? Damn...

Re:

[Mr. Underbridge (666784)]

Same old rubbish. Companies have been giving away free gifts and vouchers for free gifts for years, tacking on "on the internet" doesn't make it a new invention in anyway shape or form.

Thank you for saving me the effort of posting that exact comment. ;) Seriously though, what part of doing business as usual but adding "on the internet" passes the "nonobvious" threshold required? And shouldn't "business method" patents require a far higher standard of "nonobvious" than actual implementations and technolog

Re:

[elrous0 (869638)]

Well shit, there goes all my work on my pending "A card that can be exchanged for gifts" patent.

Die, business process patents, die!!!

[yog (19073)]

We have got to put an end to the practice of patenting "business process" before it chokes the economy to death. I think the vast 90% majority of the populace agrees that it's idiotic to grant patents for simple, stupid things like this. So let's write our congress critters and demand a change to the law.

It's not just that patent trolls can now extort exorbitant amounts of money from innocent companies going about what used to be called "doing things" and now is called "violating patents". It has also put a damper on innovation, and we are seeing American industrialists becoming timid and reluctant to market incrementally improved products, just as our Asian competitors are becoming predominant in nearly every sector through incremental improvement to design and function.

At this rate, we're going to become like the Europeans, muddling along and watching the world pass them by technologically while they debate the latest politically correct labor laws such as whether to go to a 34 hour work week.

If this sounds overly negative, try coming up with an original invention and trying to sift through the existing process patents. It's next to impossible to avoid violating some process patent or other, usually something stupid like "A method for pushing a button that causes a light bulb to flash..." To compound the problem we now have companies practicing defensive patenting (I wonder how long it will be before someone patents defensive patenting) simply to keep these trolls off their back.

I wonder that none of the presidential candidates have addressed this issue. Obama's website pays some lip service:

Reform the Patent System: A system that produces timely, high-quality patents is essential for global competitiveness in the 21st century. By improving predictability and clarity in our patent system, we will help foster an environment that encourages innovation. Giving the Patent and Trademark Office (PTO) the resources to improve patent quality and opening up the patent process to citizen review will reduce the uncertainty and wasteful litigation that is currently a significant drag on innovation. With better informational resources, the Patent and Trademark Office could offer patent applicants who know they have significant inventions the option of a rigorous and public peer review that would produce a "gold-plated" patent much less vulnerable to court challenge. Where dubious patents are being asserted, the PTO could conduct low-cost, timely administrative proceedings to determine patent validity. As president, Barack Obama will ensure that our patent laws protect legitimate rights while not stifling innovation and collaboration.

Unfortunately, Obama does not address the real problem, which is that business process and methods have been made too easily patentable. Hillary's website does not even mention patents as far as I can tell, though to her credit she does talk a lot about increasing basic science research. The word "patent" is not found on John McCain's website. As for Ron Paul, apparently he doesn't know about the issue [slashdot.org].

Anything goes ..

[hebertrich (472331)]

Yet another patent we can all live without.
The patent office is really more of a nuisance than anything nowadays.

Eh .. i got an idea .. lest get a patent in for an office that
would examine and grant patents .. see if it passes .. seeing how dumb
they are .. we got a shot at it .. 8)

Re:Anything goes ..

[Jason Levine (196982)]

No, no, no. That would never fly. Now stick an "online" at the end, make the wording a bit more vague as to what you really mean, and you've got yourself a million dollar patent idea!

Re:

[Solra Bizna (716281)]

In the true spirit of Gödel, I hereby patent patenting patenting patents.

-:sigma.SB

Re:

[Brian Gordon (987471)]

Oh good call, I didn't patent the act of patenting.. grr

Internet starter kits

[MichaelSmith (789609)]

Around 1995 it was possible to buy starter kits for internet service providers. The kit came with a month or so of access and software which would configure your system to dial the ISP. I gave one to my dad for his birthday. For me, this qualifies as prior art.

And what about AOL CD's. You might have been given it with a magazine. Sounds pretty obvious to me.

Re:

[Nullav (1053766)]

Around 1995 it was possible to buy starter kits for internet service providers. The kit came with a month or so of access and software which would configure your system to dial the ISP.

I also recall about five minutes of ads per hour pointing out similar offers from Cox and (then) SBC. Though, a better example would probably be a restaurant gift certificate for a free meal, since a lot of those seem to be limited to specific items on the menu. (Though the USPTO seems to be in a magical fairy wonderland wh

Re:

[pipatron (966506)]

a better example would probably be a restaurant gift certificate for a free meal

Sorry, IBM has already a patent on that.

What more is needed?

[Serious Lemur (1236978)]

If more than this story is needed to explain the problems with U.S. patent law in particular and the concept of a patent in general, I'd love to see it.

What about S&H Green Stamps as prior art?

[ad454 (325846)]

How on Earth did this get awarded a patent? Would not S&H Green Stamps qualify as prior art?

http://en.wikipedia.org/wiki/S&H_Green_Stamps [wikipedia.org]

S&H Green Stamps (also called Green Shield Stamps) were a form of trading stamps popular in the United States between the 1930s and early 1980s. They were a rewards program operated by the Sperry and Hutchinson company (S&H), founded in 1896 by Thomas Sperry and Shelly Hutchinson. During the 1960s, the rewards catalog printed by the company was the largest publication in the United States and the company issued three times as many stamps as the U.S. Postal Service. Customers would receive stamps at the checkout counter of supermarkets, department stores, and gas stations among other retailers, which could be redeemed for products in the catalog.

Re:

[CastrTroy (595695)]

I'm sure we can all think of a thousand things that qualify as prior art. Stores have been doing this for ages. Go to Shopper's Drug Mart, and spend $50 on seniors day, and get a free Swiss Chalet Dinner (only valid to seniors). I don't think the patent office does any real research into whether or not these patents have prior art. They probably just pass them, knowing full well that it will be decided in court.

Re:What about S&H Green Stamps as prior art?

[vtcodger (957785)]

Clearly, you have failed to research the method used by the USPTO in evaluating patents. It involves converting the patent to electronic form then scanning the text for the phrase "perpetual motion". If the phrase is not found, the patent is awarded.

No, I'm not sure that I'm kidding.

Re:What about S&H Green Stamps as prior art?

[carleton (97218)]

Seriousily... I had a former coworker who had previousily worked at the Patent Office and he strongly implied the exact opposite of your claim; they're expected to be able to either accept or reject a quota of N (for some reasonable value of N I've forgotten) patents per week and that his boss _heavily_ leaned on him to reject as many patents as possible. One of his favorite rejections was where someone had tried to patent some Windows technique (and had stolen the description of how to do it directly from a book my coworker had read and just done find-replace). Coworker also mentioned that good patent workers frequently build up a queue of rejected patents (i.e. week 1 they find a way to reject 3N patents; they then release just enough rejections each week to meet their quota and spend the rest of their time getting a patent law degree or similar or browsing the web depending on their ambition level. Also, patent office is one of the few parts of the gov't that makes a profit.

Utah, eh?

[bobdotorg (598873)]

Let me guess: Darl and his wife found their next big frivolous lawsuit.

US Patent 7003500

[Derling Whirvish (636322)]

Here's the patent:

http://www.google.com/patents?id=HY54AAAAEBAJ&dq=7003500 [google.com]

Re:US Patent 7003500

[CastrTroy (595695)]

After reading that (the abstract at least), I would say they patented the entire iTunes and Nintendo virtual console. At least the part where you buy the card at a retail store, in order to make a purchase at the online store.

Re:

[Lumpy (12016)]

And Amazon.com

I can buy around here amazon.com cards to buy items on amazon.com after i buy the car locally. Technically that also violates that "patent".

I just wonder when the patent office is going to pull their heads out of their asses and stip awarding patents on business processes and require it to be a real innovation.

Re:

[Heian-794 (834234)]

Re: US Patent 7003500

Not the point of the article, but... seven million patents in the USA. Seems like just a little while ago they were in the four-millions, but then the "...on the Internet" patent revolution got going.

And kudos to the US for using a simple sequentially-numbered system for the patents instead of an indecipherable code involving numbers, letters, and probably hyphens in between every few of those other symbols.

Let's hope human ingenuity doesn't slacken in the coming years, and t

Re:

[ozbird (127571)]

And kudos to the US for using a simple sequentially-numbered system for the patents instead of an indecipherable code involving numbers, letters, and probably hyphens in between every few of those other symbols.

Maybe if they had used an indecipherable code, there wouldn't be so many bogus US patents.

Patent Troll 1: I wonder if anyone has patented "watching grass grow on the Internet" yet?
Patent Troll 2: Let's see: Patent No. 1337-RTFM-OMGWTFBBQ discusses growing plants ...
Patent Troll 1: Whoa, to

Re:

[Qzukk (229616)]

Even from TFS I can see that the patent in question relates to cards redeemable against a specific item, rather than against credit which can be used to purchase various items.

When I was a kid, I would get McDonald's gift certificate books fairly regularly for my birthday (yeah, yeah, I'm still burning off that fat). Sold at the McDonald's register, rather than being valued at a particular dollar amount and good for anything, each page was good for, say, a free ice cream cone. http://www.x-entertainment.co [x-entertainment.com]

Re:

[CastrTroy (595695)]

Well, it does say a specific item, but in the case of the Wii Virtual console, you could argue that the specific item they are buying is Wii Points. What they do with those points later is irrelevant. iTunes ties the card you buy directly to a real monetary value, so that would probable be a harder argument. Although, it does sound a lot like Sony's recent idea of how to sell music online [slashdot.org].

MMORPGs

[sankyuu (847178)]

MMORPGs have been selling online services via prepaid cards from brick & mortar stores for a long time, e.g. World of Warcraft [blizzard.com], Ragnarok and Priston Tale, to name a few. Another numbskull patent (examiner).
Well technically, it isn't exactly media or merchandise that the MMORPGs were selling (as claimed by the patent), but in terms of prior art, uniqueness and obviousness, the patent shouldn't be valid. Heck, USPTO should employ teens as patent examiners.

Gift Vouchers?

[Schiphol (1168667)]

How is this different from gift vouchers in general? Is it because the internet is involved? So, can I patent gift vouchers if they are to be redeemed only in Polinesian straw huts? I find it truly incredible that someone thinks she has invented the buy-here-redeem-there scheme; even if the "there" in question is the internet. Of course, it's even more incredible that a patent has been granted upon this.

Re:

[j00r0m4nc3r (959816)]

To whom it may concern:
It has come to our attention that you are infringing on our patent of redeeming gift vouchers in Polynesian straw huts. We demand that you immediately cease and desist all operations involving this infringing technology. Thank you for your cooperation.

They should sue SONY, too

[F-3582 (996772)]

...while they're at it. Just take a look at their idea of selling music [techcrunch.com].

tags

[Zatchmort (1091857)]

to whomever tagged this "complementary," that's incorrect-- it's "complimentary," as in the phrase "with our compliments."

The logic of the patent system doesn't work anymor

[MikeRT (947531)]

The most frequent argument I see for patents is that they protect the little guy from the big guy. Most of us know that this is not true, and is typical of the sort of academic, only-on-paper models that are so common to professors and think tank policy wonks. In practice, the little guy can easily get wiped away by the patent system.

Let's say that I make a system that does the same thing as one of its many features. I'm a little guy, they're a little guy too. They sue me into oblivion over something that i

Re:

[east coast (590680)]

I think it's a bad measure to look on the patent system as the big guy versus the little guy. I know that the underdog is popular here but that doesn't mean that it's the original spirit of the law.

IMHO the patent system is in place to ensure that those who take the initiative and the gamble with creating something new are given an opportunity to profit from their works. I don't care if it's Joe Sixpack in his garage or if it's IBM... if you're taking the time and money to create something new you have the

My Prior Art for the NBA

[Doc Ruby (173196)]

In 1995, I invented a magstrip card sold at all 700 Shoppers Drug Mart convenience stores in Canada. The card was good for a pair of tickets to either a Toronto Raptors or Vancouver Grizzlies game, the 2 new NBA teams we were hired to help launch. In the SDM store was a kiosk that was a Mac with Netscape on a a private TCP/IP network identical to the Internet, but not connected to it, just to its own hosts around Canada. Some of these hosts had the webservers and DBs running the ticket dealing app. Swiping the card unlocked the kiosk, navigating the websites sold the tickets, which when printed deleted credit from the cards.

That app and those cards were precisely the same as these music gift cards, for a product that happened not to be music, but otherwise identical - a trivial difference. So this post constitutes my notification of prior art. Apple and Starbucks can pay me now to use it invalidate these Utahrds' entire patent.

It probably won't stand...

[portwojc (201398)]

Though superficially different, this is just an infringement of the patent under a new name, the lawyers argue.

It's been a while since I had to deal with patent law but what I remember is this.

You just have to be different; even in the smallest way. Get past one of the primary claims, not the dependent ones as they don't count, and the patent doesn't hold.

Also, if this were to hold or if it doesn't and/or the previous product infringes, it shouldn't matter if company XYZ simply pulled a product from the shelves that was infringing.

They really should consult an attorney in patent law. If they are one then well you know what they say about representing yourself.

Kill the underdog

[russotto (537200)]

Somehow, it just feels wrong to hope that a big, faceless, corporation crushes a couple of small inventors into dust with the power of their legal department. But in this case, I have to say "GO GOLIATH! CRUSH THOSE PIPSQUEAKS! WATCH OUT FOR THAT SLING!"

Re:LMAO

[evanbd (210358)]

(It isn't that I hate Apple or support patents, it is just that I hate capitalism. Can't you see the connection?)
--
DISCLAIMER: Use of this advanced computing technology does not imply an endorsement of Western industrial civilization.

But apparently you're willing to use this advanced technology even though it is the product of something that goes against your principles. How pragmatic of you. How... dare I say it... capitalist? After all, your actions seem to imply that you value your short term personal gain over your principles, and that furthermore you can absolve your conscience with a disclaimer that says the opposite. If that behavior isn't typical of the large Western corporations you claim to despise, I don't know what is...

Re:LMAO

[stranger_to_himself (1132241)]

But apparently you're willing to use this advanced technology even though it is the product of something that goes against your principles. How pragmatic of you. How... dare I say it... capitalist? After all, your actions seem to imply that you value your short term personal gain over your principles, and that furthermore you can absolve your conscience with a disclaimer that says the opposite. If that behavior isn't typical of the large Western corporations you claim to despise, I don't know what is...

I don't think there's anything wrong with that. Just because somebody doesn't approve of a political or economic system, it doesn't make them a hypocrite for using something that was created under (although not necessarily as a consequence of) that system. I might disagree with the current patent system, but that shouldn't stop me using something that was developed using it.

Regarding the second part of your comment, I don't think capitalists have the monopoly on being selfish, shortsighted or even pragmatic.

Re:LMAO

[orzetto (545509)]

But apparently you're willing to use this advanced technology even though it is the product of something that goes against your principles.

The modern rocket was a product of the Nazi regime and was applied for terror bombing. The first man into space was a Soviet. That did not stop Kennedy from starting the Apollo program (headed, by the way, by the same guy who was working for the Nazis and built his rockets with Jewish slaves).

There are lots of useful technologies developed by assholes. For instance, there is a great deal of knowledge about how to deal with modern chemical weapons in Iran, because someone sold their enemies lots of chemical weapons. Going back in time, the Interstate system in the US is inspired by Hitler's Autobahn system that Eisenhower saw during the war; the Fischer-Tropsch process (coal to petrol) was used to drive Germany in its last year of war; and I could go on.

Technologies are things, and as such they cannot have an opinion on politics.

Re:

[cenonce (597067)]

I think it is more likely that Apple's lawyers pitched some offers to this couple to "make them go away" and couldn't work anything out. Then they just went about their business of setting up the service (this service through Starbucks was probably already well in the works - doubtful the "delay" was some tactic against this couple, though they might perceive it that way and allege it in the complaint). This patent seems silly - and in my mind, the longer it goes the worse the deal gets for the Plaintiff.

Re:

[alexgieg (948359)]

(It isn't that I hate Apple or support patents, it is just that I hate capitalism. Can't you see the connection?)

No, you don't hate capitalism. You hate government interfering on free market, such as through its "patents" system, which wouldn't exist in a system of purely voluntary exchange of goods and services, i.e., in a capitalistic system. Once government dictates and enforces arbitrary rules of exchange, it's not capitalism anymore, it's something else.

Re:

[node 3 (115640)]

You're right. How dare everyone else in the world use the term "Capitalism" to mean something counter to your invented definition.

Here's a clue:

Capitalism is *not* an economic system with zero government intervention.
Communism is *not* an economic system where the government owns the means of production.
Socialism is *not* an economic system where the workers own the factories.

Those are all just arbitrary definitions which were invented, after the fact, to try to divvy up economic systems into neat little ba

Re:

[alexgieg (948359)]

Capitalism is an economic system which focuses on the free market.
Communism is an economic system which focuses on central government control.
Socialism is an economic system which focuses on the welfare of the people.

If you prefer it that way, okay with me. After all, according to these categories, the USA has a mix of communism and socialism. My point stands intact. ;)

When someone says they hate Capitalism, they aren't saying they hate the econ 101 definition, they are usually saying they hate a system whi

Re:

[XxtraLarGe (551297)]

Once government dictates and enforces arbitrary rules of exchange, it's not capitalism anymore, it's something else.

It's called Mercantilism.

Re:

[donscarletti (569232)]

it does appear...that they knew that the card system infringed on a patent, and yet went used it anyway.

Now the problem is that patents in some countries are just approved without proper review and then expected to be examined properly in court, there should not be any penalty for a company like Apple waiting it out before they have any idea whether the patent is valid because they haven't been sued.