The United States Supreme Court signaled skepticism about broad software patents Monday when it ordered reconsideration of an online advertising patent. The high court asked the United States Court of Appeals for the Federal Circuit to reconsider its decision approving the patent in light of a March Supreme Court decision restricting patents on medical diagnostic techniques.
The online ad patent, granted to a company called Ultramercial, covers the concept of allowing users to watch a pre-roll advertisement as an alternative to paying for premium content. Ultramercial has demanded licensing fees from several online video sites, including Hulu and YouTube. One target of Ultramercial's legal threats, a company called WildTangent, challenged Ultramercial's "invention" as merely an abstract idea not eligible for patent protection.
A new machine
The Supreme Court has ruled several ideas to be outside the bounds of what can be patented, including an algorithm for converting between binary number formats, the concept of hedging against the risk of commodity price changes, and the process of adjusting the dosage of a drug based on measured levels of a particular chemical in a patient's blood. WildTangent argued that Ultramercial's patent was so abstract that it did not qualify for patent protection under these precedents.
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