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Don Burleson Blog 







Oracle Systems threatened by Patent Infringement Lawsuits

Oracle Tips by Burleson Consulting
December 2005
Don Burleson

If you are an Oracle professional charged with ensuring that your shop has adequate licenses for your Oracle databases and tools, take heed.  Recent court lawsuits suggest that your brand-new eCommerce site might have to pay royalties if your application uses intuitive features such as ?one click? and ?secure credit card verification?.

Yes, these are patented technologies.  The ?bargain? option of using powerful Oracle tools such as APEX and SQL*Forms to create a custom shopping cart may evaporate quickly when you add-on the royalties that you must pay a patent holders.

Current lawsuits may open a floodgate of lawsuits against those who infringe on patents when using Oracle to build custom eCommerce functions.

Oracle RAD tools foster customized applications

All Oracle managers face the ?build? vs. ?Buy? decision.  Is it cheaper to buy an eCommerce product and strap-it-onto Oracle, or is it better to develop a customized solution using Oracle RAD tools?

Oracle offers a host of super-powerful tools for custom eCommerce database, and the toolset within Oracle is consider the finest in the application developer arena.  These tools are the de-facto standard for online Oracle databases because of their robust features and easy-to-use interfaces with Oracle:

  • Oracle Application Server 10g
  • Oracle JDeveloper
  • Oracle APEX

These tools provide a complete do-it-yourself environment where Oracle professionals can online Oracle systems that employ the sophisticated eCommerce features that are demanded by today?s web buyers:

  • One-click checkout
  • Name your own price
  • ?Real Name? consumer feedback

Because of the Rapid Application Development (RAD) functionality within these Oracle web developer tools, many Oracle shops choose to ?build?, rather then ?buy? eCommerce their components.  For example, Tony Jedlinski, an IOUG volunteer notes that the shopping cart for his corporation, Roman, Inc, chose to write their own shopping cart in APEX and it only took a few days.

Let?s take a closer look and see how you can protect your Oracle database from patent lawsuits and pay royalties to the owners of any inventions that you inadvertently employed in your eCommerce database 

Is your Oracle system at-risk?

More and more, Oracle shops are recognizing that their ?competitive advantage? in eCommerce relies on their end-user interfaces, and they are choosing to write customized eCommerce applications for payment processing, customer management and shopping carts with sophisticated ?recommendation engines? that suggest purchases based on the purchases of other ?similar? customers.

The OracleAS ?Personalization engine? is one such application of customized functionality, and we assume that the ?recommendation engine? (Customers who bought ?xxx? also liked ?yyy?), is a generic, non-patentable concept.  Not so, according to Cendant, a company that purchased some extremely valuable eCommerce patents:

Cendant Publishing, a division of the multinational giant Cendant Corp. (another e-commerce pioneer) claimed's method of offering online book buyers recommendations of books violates its patent.

Wow, that scary stuff to the Oracle developer who just spent six-months writing a state-of-the-art engine using Oracle personalization and recommendation technology. 

Here we see that Amazon holds some very important patents for electronic e-commerce and they are counter-suing Cendant, hurling their own barrage of patented technologies.  The article below notes that Amazon is enforcing patents on some integral components of e-commerce, implying that Amazon may be entitled to royalties from anyone who creates e-commerce software that uses ?tools to secure credit-card transactions, handle customer referrals and manage data?:

Cendant, the biggest U.S. provider of travel and real-estate services, knew "or should have known" it infringed when using the tools to secure credit-card transactions, handle customer referrals and manage data, according to the lawsuit filed June 22 in federal court in Seattle.

The History of the Valuable Patent

U.S. Patent No. 6,782,370 is for "a computer-implemented method and system utilizing a distributed network for the recommendation of goods and/or services to potential costumers based on a potential customer's selection of goods and/or services and a database of previous customer purchasing history."

This important, general patent has a long history of ownership:

  • 1987 ? Original patent filed by Open Source
  • 2001 ? Open Source goes bankrupt and purchased by Andy Filipowski?s Divine Inc.
  • 2004 ? Cendant buys patents from Divine and sues Amazon for infringement

Remember Andy Filipowski?

Andy, ?Flip? Filipowski has been a database vendor since the 1970?s and a major purveyor of Oracle development tools.  During the pre-Oracle days of network databases (Cullinet?s IDMS/R database) Flip wounded DBMS Inc, a company dedicated to providing tools for database management.

Back when Oracle was just a gleam in Larry Ellison?s eye, (circa 1987), Flip founded Platinum Technology, a major player in the 3rd party Oracle tools market, including Oracle tools such as Platinum Plan Analyzer and the Platinum Repository.  Platinum was acquitted by Computer Associates in 1999.


World?s largest Oracle eCommerce shop lands in court

Amazon, one of the world?s largest and most-sophisticated Oracle RAC shops, has a reputation as a leader in electronic e-commerce, most-recently instituting a ?real person? book-review option that correlates the reviewer?s name with the credit card on their Amazon account.  This has been lionized as a long-overdue innovation in verifying the credibility of those who express opinions in cyberspace.

In an article from titled ?E-Commerce Patents?, the authors claim that Amazon holds the patent to the ?one click technology? an easy-to-use checkout method that mirrors the goals of every e-commerce system on earth:

An example of a famous e-commerce patent is U.S. patent number 5,960,411, for's "one-click" technology, which describes a method of allowing an online customer to order a product instantly by clicking a single button. Reaction to this patent's issuance was swift and largely negative. Read more: Wired News, Tim O'Reilly. sued its primary competitor,, for patent infringement. Although obtained a preliminary injunction from a federal district court, an appellate court reversed, and the parties settled before trial.

CNET has an article titled ?Are e commerce patents patently absurd??, where we see that companies like  (owner of the ?name your own price? model, a patented technology), and Open Market, the holder of a super-broad patent on integral parts of any e-commerce system which secured a patent on ?

That includes software to implement the emerging Secure Electronic Transactions (SET) protocol for Internet credit card purchases, other forms of instant Internet payments, including sending a credit card number over the Internet using Secure Sockets Layer (SSL) encryption, any application that uses a "shopping card" to collect multiple purchases from a Web storefront, and perhaps the use of digital certificates.

But not everyone aggress that the Open Source patents are valid, arguing that ?broad categories? such as credit card payments are not patentable:

Open Market's patents kicked up considerable furor. They covered online "shopping carts" in Web storefronts, certain secure-card payments over the Net, and some ways of tracking visitors through a Web site. Critics attacked the shopping cart patent in particular, saying it was "obvious" because it merely moved a physical world concept onto the Net. A patent must cover "non-obvious" technology.

But the story gets better when ?Open Source? fails and super-rich web speculators like Flip started seeking the to buy the bankrupt Open Source, perhaps for it?s valuable e-commerce patents:

Ultimately, Open Market fell victim to the dot-com collapse, when the companies that bought its commercial e-commerce software vanished in droves. Once worth more than $2.1 billion, Open Market was gobbled up in 2001 for $59 million by Chicago-based Divine Inc.

Divine didn?t fare well either. Just a year and a half later, Andrew ?Flip? Filipowski?s Internet-incubator-turned-tech-rollup collapsed into the arms of bankruptcy protection.


Protecting Your Oracle Application

The job of every Oracle professional is to ensure that their work is unique and original, and every Oracle professional must resist the temptation to ?borrow? features from other eCommerce sites, last they be patented.

There is also a patent reform bill that was submitted before Congress and a case pending before the Supreme Court (KSR v. Teleflex), relating to the patentability of ?obvious? technologies:

Whether the Federal Circuit has erred in holding that a claimed invention cannot be held ?obvious?, and thus unpatentable under 35 U.S.C. ? 103(a), in the absence of some proven ??teaching, suggestion, or motivation? that would have led a person of ordinary skill in the art to combine the relevant prior art teachings in the manner claimed.?

Oracle has its own share of patent woes, too.  Oracle estimated that it spends millions of dollars each year defending itself against patent infringement lawsuits (Microsoft spend over $100,000,000 per year) and Oracle and Microsoft are both calling for Patent reform:

Smith's comments, directed at the dozens of congressional staffers in the audience, represented Microsoft's latest critique of a patent system that has caused it to spend $100 million a year defending itself against 35 to 40 lawsuits at any one time. Microsoft has gone on the legislative offensive after a jury awarded Eolas Technologies $565 million in damages--which has been partially reversed--in a patent dispute over Internet Explorer.

If you are an Oracle manager, they you have a larger duty where you must ensure that your company owns all licenses for the technology used by your Oracle application.

  • Consult a Patent Attorney - With so-much of eCommerce being patented, there are no ?hard-and-fast? lists for knowing if you have violated someone?s patent rights.  A Patent Attorney should be consulted to research the current status of all patent infringement lawsuits relating to your eCommerce system.
  • Use Vendor Packages - Another approach is to use ?purchased? packages, such as Oracle?s eBusiness suite of products.  When you purchase a software package, the vendor assumes all responsibility for the functionality of the software and your company is not at-risk.  Also, be aware that popular open-source eCommerce products such as OsCommerce may not offer the same protection as a ?paid-for? eCommerce solution.

Bottom line, it is easy to accidently appropriate a patented technology, even if you write it from-scratch, and these honest mistakes could land your employer in court and bankrupt your company.  It?s the job of all Oracle developers are designers to make sure that they do not put their company at-risk from patent lawsuits.



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