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Kickstarter Wins Their First Patent Lawsuit, Thwarts Troll

I’ve come to be known as a bit of the crowdfunding aficionado, here at TechDissected, so when I came across this story I knew I had to pass the information along to you. Crowdfunding is a very important part of our new global economy. It takes the Shark Tank out of finding investors for a good idea. It allows the consumers to determine whether an idea will sink or swim. It hasn’t come without its problems, but overall I think most people agree that the benefits outweigh the costs.

Kickstarter v ArtistShare (aka Fan Funded, LLC)

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Crowdfunding has actually been around for a while now, in fact, one company thought that they literally owned the patent on it. That company is called ArtistShare and they approached Kickstarter back in 2011 trying to strike a business deal because according to ArtistShare founder, Brian Camelio, Kickstarter was infringing on his patent and was intending to sue if they didn’t start paying him royalties. Kickstarter had other plans, taking the matter to court first seeking to invalidate his patent entirely. During a 2011 interview Camelio said he was “stunned and disappointed” by Kickstarter’s move.

Fast forward four years and Camelio is probably a lot more disappointed because according to a court order published June 29th, his patent “Methods and Apparatuses for Financing and Marketing a Creative Work,” has officially been killed.

In the lawsuit, ArtistShare made the point that they weren’t trying to own crowdfunding, only that they had patented “particular systems for managing, marketing, and financing creative work,” arguing that it wasn’t an overly general patent. This is important because software patents have come under a lot of scrutiny over the last couple of years and the Supreme Court’s decision last year to kill Alice Corp’s “Do it on a computer” patents for being too “abstract” set a precedent.

In response to this, US District Judge Katherine Failla wrote in the court order, “Defendants’ repetition of words like ‘particular’ and ‘specific’ in bold italics when referring to the claims in the ‘887 Patent does not make them so.” She went on to say, “Just because the claims do not preempt all crowd-funding does not make them any less abstract…Nothing about the ‘887 Patent transforms the concept of crowd-funding into patent-eligible subject matter,” meaning it really shouldn’t have been granted a patent in the first place.

At the end of the day, it would seem that ArtistShare had no real creative thing to share, as irony would have it. Dressing up something that people have been doing for a long time with some computer language doesn’t make it unique.

Kickstarter’s Deputy General Counsel Michal Rosenn was quoted as remarking, “We’re pleased the Court agreed that this patent is invalid, and we’re happy to see this case reach its conclusion…This is a win for artists, ideas, and creative freedom.”

Source: Ars Technica