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Apple, Starbucks sued over iTunes promotion cards

AppleInsider is reporting that Apple and Starbucks are being sued because of their recent iTunes promotion cards. James and Marguerite Driessen claim to hold a patent on, what they call "RPOS" (or retail point of sale for online merchandising). The patent in question allows customers to buy a gift card from brick-and-mortar stores and then go home and redeem the card online. However, Apple has an excuse, because while the Driessens' patent was under review, Apple developed their own similar concept for redeeming the iTunes gift cards.

Apple's gift cards allow a person to enter a code on the iTunes Store and receive a whole artist's album, along with the artwork. However, due to legal pressure from the Driessens, Apple apparently pulled the iTunes gift cards from the stores, but left them in UK Stores.

Now, here's where this may get a little sticky. I've been wondering why this is only affecting the Apple iTunes cards. Why aren't other gift card manufacturing companies getting hit with this suit? This patent application seems to describe pretty much every gift card that I have seen; such as those credit-card-gift-cards that you can buy at most malls -- you can also use those online as a credit card. And not to mention those Zune music cards! What do you think? Should Apple be forced to remove their cards that provide convenience to customers, or should they fight back? Be sure to sound off in the comments below!


[via AppleInsider]

AppleInsider is reporting that Apple and Starbucks are being sued because of their recent iTunes promotion cards. James and Marguerite...
 

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Ryan Orlick

My local stores are still carrying the cards.

February 23 2008 at 10:46 AM Report abuse rate up rate down Reply
1 reply to Ryan Orlick's comment
jdlaw27

It seems like many of the replies in this thread have not even tried to really understand the article or what the patent is really about.

1. They say things like it is too simple and anyone could have invented it. You could say that about almost any really great idea or invention. The autombile windshield sunshade for example; should that guy not have gotten a patent because it was too simple. Things are always simple when you already know the answer.
2. They assume that the people with the patent are nothing but patent squatters and have done nothing to make their own business. Wrong. It seems the people with the patent filed in 2000. That means they probably invented it well before then. I found that they have a website at http://www.vibme.com which was started in 2004. On that site they claim to have also had ripsave.com and non-virtual.com before that and those were successful.
3. They assume the invention is just plain gift card. Wrong. The invention is for specific merchandise gift cards. You can't go into wal-mart or toysRus and pick up a gift card for a specific item. You have to get a gift card for a dollar amount and use that towards a general purchase. This really is different.
4. They assume that Apple wasn't first approached and asked to license. The actual court papers which can be downloaded if you belong to a service (I do) say that they contacted people like Apple as early as 2000 and have been ever since. How would you like it if you kept telling someone your idea over and over and they keep telling you it's no good and then they just turn around and just do it making millions of dollars on something they stole from you.
5. They assume the patent office just screwed up. The fact is that Apple and everyone in the download business has patents and they certainly expect you to pay if you are going to use it. Just go to USPTO.gov and look up all the "simple" patents Apple has. The fact is computer implemented business methods patents are a major part of Apple's portfolio. Ever since 2000, art section 705 (computer business methods) require double examination and allow for outside input on whether it can be patented or not. That is making the computer business method patents among the strongest, hardest to get, and hardest to defeat.
6. They assume a patent is easy to get. No its not. Most patents cost at least $100K to get now days. I'm sure these people paid through the nose. An invention must be new, useful, and non-obvious. It took the patent office 6 years to go over this one. My hat goes off to them thinking of a much more consumer focused way of doing gift cards. Those stupid money store cards I'm told have up to 60% waste (putting money on the card that never gets used). This new gift card is something great for the user. Let's applaud them for working to bring it to the public. Most of these home based inventors don't want much. Just to be acknowledged and not tossed aside.

February 23 2008 at 7:02 PM Report abuse rate up rate down Reply
Bob Smith

No password showed up in my last email.

February 22 2008 at 11:11 PM Report abuse rate up rate down Reply
kirbdog

I am just wondering why this would not apply to the Point of Sale Cards like the ones for XBox Live, Microsoft Points or Nintendo Points needed to purchase games, movies and music online thru those devices?

February 22 2008 at 9:26 PM Report abuse rate up rate down Reply
1 reply to kirbdog's comment
Kai Cherry

because they aren't selling and end product; they are essentially "virtual cash" accounts.

This is precisely not what these guys have a patent on.

Now, if Ninty offered a say "Super Mario World" card that you paid for at your Gamestop. then took it home and typed the exact thing on the card into the store and it sent Super Mario World to your Wii, then that would be infringing.

Even having a card that had Super Mario World on it, but you had to type in your number then request/finf SUper Mario World then "Download" (or whatever)...this usage is in he clear.

Its the '1 to 1' model that they have the patent on, and it is a damned clever innovative (look up what the word means...it will surprise you) way of applying the disparate stuff that is/was out there.

It *is* fairy obvious *now* but it certainly doesn't seem like it was to anyone when he got the patent for the method ;)

February 22 2008 at 9:42 PM Report abuse rate up rate down Reply
Viper007Bond

I'm going to patent breathing and sue you all for eleventy billion dollars.

February 22 2008 at 8:50 PM Report abuse rate up rate down Reply
Bob Smith

How do I get a permanent account here on TUAW? Blogsmith appears to have no account registration feature. When I look at my profile it asks me to log in, but of course I can't give my password to log in because I haven't created one yet.

February 22 2008 at 7:13 PM Report abuse rate up rate down Reply
1 reply to Bob Smith's comment
Viper007Bond

Type your name/e-mail. When you get the e-mail asking you to verify, a password you can use to skip verifying each time will be at the bottom of the e-mail.

February 22 2008 at 8:51 PM Report abuse rate up rate down Reply
Edsel


This story has got to be a hoax.

Sears, Roebuck and Co has been selling merchandise for over 100 years through virtual exchanges.

BTW, the above memo from "James L. Driessen, JD/MBA BSME" contains all sorts of grammatical errors. Lawyers are precise when it comes to clarity of opinion and facts. This guy is not.

February 22 2008 at 6:49 PM Report abuse rate up rate down Reply
1 reply to Edsel's comment
Kai Cherry

Again, it is a very specific patent on a very specific thing, which as easy as it is to get around, its rather blatant on Apple's part to implement the exact same business method.

The reason why Apple appears to not have worked around it is that well, his way is the most user-friendly and kludge-free...probably why they bothered to get the patent :)

February 22 2008 at 9:46 PM Report abuse rate up rate down Reply
Kai Cherry

Ok guys.

If you can find a single instance of a "POS Giftcard for purchasing a *specific* Digital Item to be retrieved post-purchase via the Internet" then by all means...

Show it.

I honestly believe this guy really DID pull this off, because in 18 years of Internet uses, "shopping carts"..."redemption codes" and everything else WRT to Interwebs, I can honestly say i've never seen something this...*specific*...

And THAT is wht the guy has a patent on.

I can also see why he early on ad a hard time with it, because *at that time* the concept was ludicrous.

Of course NOW we call all "see it"...but like the man said...no one saw it before he wrote it down...there was nothing to *buy* at that time.

He ALSO points ot that he has at least one legit licensee...

February 22 2008 at 6:14 PM Report abuse rate up rate down Reply
Bob Smith

Prior art anyone? I have serious doubts somebody else didn't publish this idea first. As to obviousness, I don't see the difference between "buy retail use online" and "buy retail use elsewhere", the latter being damn obvious as well as prior art.

February 22 2008 at 4:22 PM Report abuse rate up rate down Reply
1 reply to Bob Smith's comment
Sean

"For now, suffice to say that paying for Internet based merchandise at a retail point of sale is not and never was obvious without first seeing the teachings of my patent application."

It was obvious, it just seemed stupid.

Where is the invention here? There is none. Typing a code from a piece of paper into a computer is certainly not innovative. Using a code to grant access to a file is nothing new. Combining existing technologies is not supposed to be an acceptable way to get a patent.

Besides, those cards are dumb. Just buy the damn album from iTunes. You have to use it to get the download either way.

Oh, and prior art? Back in the 80's you could purchase a Quantum Link started kit in a store, take it home to your Commodore 64, and use it to get online service. Exact same concept.

Bite me, you frigtard patent troll.

February 22 2008 at 5:48 PM Report abuse rate up rate down Reply
Timothy Julius

This is just ludicrous. For one, I don't honestly believe that they'll be able to win such a bogus lawsuit. Also, it seems that they just have a personal vendetta against Apple that is completely unjustified. They are going after Apple because they believe that they will be the easier target because of how much money they make with the iTunes service. In closing, this is just another way for some losers to get some money from a respected well-to-do company. NO WAY should Apple remove those cards & they ought to form a counter-suit for defamation of the Apple namebrand!

February 22 2008 at 3:44 PM Report abuse rate up rate down Reply
Shawn McBee

So, I actually sent an email out to the guy who is suing Apple, basically saying the same things that most of you (any myself in a previous post) have said. And he replied. Sounds like they may have a legitimate case after all.
The reply:

Thank you for your interest.

The following is based on my own beliefs. You will have to confirm for yourself.

You can learn more about the "Buy it here -- play it anywhere" retail sales of Internet merchandise by going to http://www.vibme.com which is currently the only authorized licensee for the 7003500 patent. Frankly, the "card" thing is only a small portion of the usefulness of this patent.

I can't go into great detail now, but would be happy to talk to you more if you are willing tell me more about yourself, what your intentions are, and what you plan to do with any of the information I give you.

For now, suffice to say that paying for Internet based merchandise at a retail point of sale is not and never was obvious without first seeing the teachings of my patent application.

Certainly, once the secrets of an invention are known, they may all seem obvious to some, but that is not the way the patent system works. For example, Thomas Edison merely took the air (oxygen) out of the electric light bulb and replaced it with a gas that would not allow combustion to take place inside the bulb. At the time it was extremely well known that all things simply would not burn inside a vacuum container without oxygen. By your reasoning, therefore, the electric light bulb was obvious.

The fact of the matter is that I have been doing the RPOS system for over 6 years successfully. I have constantly during that time sought diligently with all the studios, the recording industry, and many other Internet media based companies to license. However, I got indications from them that they thought it was too "complicated." Why would a consumer pay for Internet merchandise when they already have credit cards and stored value "gift" cards to solve that need. "Why was this any different?"

I don't yet know about the others you mentioned, but I will look into it. Frankly, a lot of what people tell me they think are infringers actually aren't. They are likely still using some sort of stored value gift card, it is not for a specific purchase, or it is simply for site access and not specific merchandise. The 7003500 patent pertains mainly to buying an "internet shopping cart" at retail. Others even told me it was impossible, since "that's not the way an Internet transaction takes place."

The fact is that it is very different. Going to a real place of business to pay for virtual space merchandise is finally catching on only because of my constant efforts to get this way of doing business across. If you don't believe me that this was a "groundbreaking" shift in thinking for Internet merchandising then simply look to Apple's own 2005 introduction of the "specific song" download card. Only after me telling them about the idea it seemed they went and launched their product based on my ideas and also seemed to claim it as their own "groundbreaking new technology."

Apple, Priceline, Sony, Amazon, Ebay ... the list goes on forever on companies that strongly protect their intellectual property when it comes to new and innovative ways to buy or sell merchandise on the Internet. In hindsight, you may think that all of those are very simple ideas, but they were not obvious. Simplicity was never the standard for obviousness.

If you want to say that I am "Patent Squatting, waiting for a legitimate business to come
along and use said business model" then you must say the same of Apple, Starbucks, and anyone else who owns owns intellectual property.



James L. Driessen, JD/MBA BSME
305 N 1130 E
Lindon, UT 85042
mb. (801)360-8044

February 22 2008 at 3:07 PM Report abuse rate up rate down Reply
1 reply to Shawn McBee's comment
Fritz Laurel

I still don't think he has a case in the world of common sense. In a courtroom, sure, but only because the current patent law really, really, really sucks.

This guy, by his own admission, "invented" a new way of doing business but rather than creating a business around that "invention," he tried to license it to others.

The patent system was originally designed to protect innovations, but only in relation to the businesses that could be built around them. It was meant to give the innovator a head start and a competitive edge against rivals.

In my opinion, anyone who refuses to take action on a patented innovation (i.e. implement it) in a reasonable amount of time (by building a business around it, etc) should lose the rights to that patent.

Also, claiming that other companies like Apple and Starbucks are "patent squatters" isn't true to my knowledge. I haven't heard of Apple suing anyone over a ridiculous patent. Because of the screwy way the laws work regarding patents, companies these days are forced to register patents for every little miniscule thing as a defensive measure against trolls like this guy.

I don't question whether or not what he came up with was innovative, no matter how obvious it may seem now. In my opinion, though, since he never did anything with it, that makes him nothing but a patent troll. That is, he is doing nothing but waiting to make money off of other people's hard work. And that, in my book, is wrong. Very, very wrong!

FL

February 22 2008 at 4:34 PM Report abuse rate up rate down Reply
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