Business [processes]…are being turned into patent applications, says Edward Fan in Lexpert

November 03, 2008

The emergence of BMPs in Canada is likely to surprise companies if their business methods are challenged as infringing patents. Although American courts have started to question BMPs' validity, lawyers in this country should be aware of their existence — and how to best protect their clients.

Consider, for example, the BMPs owned by an American company called DataTreasury Corporation. The company's patents describe a way to electronically and remotely image and retrieve transaction records. The company claims the patents extend to all forms of image-based cheque clearing and other electronic payment technologies.

In Canada, the financial services industry has recently moved to a system of electronic cheque imaging to replace traditional paper-based systmes. The projected cost savings are enormous.

But in January 2006, the Canadian Intellectual Property Office (CIPO) approved the first of the Data Treasury patents that had previously been issued in the U.S. It wasn't long before the company sued several Canadian banks. The litigation is still in its early stages, but its emergence is slowly bringing the controversy over the feasibility of BMPs to the attention of Canadian business.

"There are things that businesses have been doing for ages that some people are grabbing and turning into patent applications," says Edward Fan of Torys LLP.

Read the full article here.

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