149 F.3d 1368 (Fed. Cir. 1998) cert denied 119 S. Ct. 851 (1999). In the six months following the ruling, patent filings for software/Internet business methods increased by 40% and the USPTO created a new classification for applications: "Data processing: financial, business practice, management or cost/price determination."

The Cost of a Business Method Patent

The cost of obtaining a business method patent depends on several factors, including the subject matter of the patent, the complexity of the examination process, and whether a lawyer's fees are involved. You can expect to pay between $3,000 and $15,000 to acquire a business method patent unless you do it yourself, in which case the costs are much reduced. After a patent is issued, the owner must pay maintenance fees to the USPTO after 3.5, 7.5, and 11.5 years. Of course, if the patent is challenged -- and many are -- the costs can skyrocket.

Timeline for Obtaining a Patent

It usually takes two and a half to three years from the date of filing an application until a business method patent is issued. The period between filing and issuance is called the "pendency period." A patent owner cannot stop a competitor from using the process during the pendency period, regardless of whether the competitor purposefully copied the method or stumbled upon it independently. Only after a patent is actually issued can a company stop another from using making or selling the process. The patent is then valid for 20 years from the date of filing.

Determining Who Gets a Patent

What happens if a competing business claims that it was already using the particular method that is the subject of a patent application? If Business A files for a business method patent, but Business B can show that it was using the method publicly more than a year prior to the filing, Business B can thwart the patent application or, if necessary, invalidate the patent later. The key is that Business B's use of the method must have been public. If Business B used the method confidentially, the patent will be issued to Business A. However, under a 1999 amendment to the patent law, if Business B used the method confidentially before Business A filed for a patent, it can continue using the method without liability for infringement.