March 17, 2004
Amazon hit by 'shopping cart' patents lawsuit
Amazon is being sued for allegedly violating three infamous patents for online shopping processes that were granted to e-commerce software company Open Market in 1998.
The lawsuit is revealed in Amazon's latest financial filing with the US Securities and Exchange Commission, which also notes a separate lawsuit, filed in July 2003, for alleged violation of another other e-commerce technology.
The Open Market 'shopping cart' patents were heavily criticised when they were granted, both because of claims from other companies such as NetMarket that they had demonstrated the techniques previously and because of general controversy as to whether business processes could be patented at all. Many observers feared that the Open Market patents could be used to close down e-commerce sites unable or unwilling to pay licence fees.[ZDNet]
At a trade show some years ago, I asked Open Market's VP of Marketing what Open Market offered that a good programmer couldn't replicate in a week. I asked because I honestly couldn't figure it out. They had a primitive shopping cart at the time. It couldn't even be customized to look like a web site that made use of it.
The VP at first just said "Try it!", assuming I was being flip. But I wasn't. I assured him that I actually wanted to know. He said something about calculating sales taxes for different localities. I wasn't very impressed, particularly since Web sites don't have to collect sales taxes from areas where they don't have a physical presence.
Soon after that, Open Market was valued at $400 million. But today, after several changes of ownership, all that's left of the company is those patents. I haven't looked at them yet, but I suspect it's just another example of the PTO giving incredibly broad patents to completely obvious ideas.