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Blockchain Patents And Litigation – Intellectual Property

United States: Blockchain Patents And Litigation

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Blockchain has the potential to be the new frontier of innovation and a disruptor of existing technologies, and with that, has the potential for significant patent litigation. The technology now commonly referred to as “blockchain” was first described by Stuart Haber and W. Scott Stornetta, and then used to describe the bitcoin framework by a writer using the pen name Satoshi Nakamoto. The most discussed use of the blockchain is for financial instruments, such as the aforementioned bitcoin as well as Ethereum and dozens of non-fungible tokens, or NFTs. However, blockchain is being considered for many other fields, including energy trading, supply chain management, healthcare, e-commerce, and life sciences.

Blockchain has been the subject of numerous patent applications over the past decade. At the time of this writing, at least 5,7451 the patents granted relate specifically to the blockchain. The number of published and granted patents on the technology has increased:

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https://www.lens.org/

The number of blockchain-related patents is significant, but the number of patents issued for many other technologies dwarfs that number. The number of blockchain patents issued is likely due in part to the long delay between filing an application and issuing a patent (currently on average 23.2 months). More patents are on the way and the number of issued patents continues to increase.

Blockchain has not been a major source of patent litigation. However, a case currently before the courts is Rady v. Boston Consulting Group, LLC.2 There, Rady developed a method to identify physical objects, especially gemstones, by their unique properties using 3D spatial mapping and spectral analysis and recording the result on a blockchain which acts to ensure the authenticity of the physical object. A defendant requested rejection, claiming that the patent is not patentable subject matter because it covers an abstract concept without any inventiveness. The current state of patentability law is a potential obstacle for blockchain-related litigation, and if the case were to proceed, it could provide a first indication of how claims construction and validity issues. could unfold for blockchain patents.

There is reason to believe that more blockchain-related patent litigation is coming, but only time will tell how many more cases are filed. As more and more patents are granted, the chances of them falling into the hands of a party willing to claim them also increase. Also, as the companies that use this technology mature, they generate more revenue. These revenues will attract those who want to extract value from their patents. This is certainly an area to watch for anyone interested in patent litigation.

Footnotes

1 https://www.lens.org/ using the search terms “Blockchain” and “Distributed Ledger”.

2 n ° 1-20-cv-02285 (SDNY March 13, 2020).

The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.

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