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Who ya gonna call? Patent busters!
BountyQuest CEO Charles Cella explains why his Web site is offering cash to patent destroyers.

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By Damien Cave

Oct. 23, 2000 | Charles Cella used to help start-ups like ARTISTdirect apply for Internet business method patents. Now the attorney-turned-CEO plans to make money busting them.

Why the change of heart? "Because there are a lot of bad patents out there, and there are a lot of valid patents too," he says. "What needs fixing is the system of 'prior art.'"




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"Prior art," says Cella, referring to a legal term used to describe inventions that invalidate patents by proving that they aren't new ideas, "is just too hard to find."

Which is where BountyQuest, Cella's new company, comes in. Launched on Wednesday, BountyQuest aims to quell the raging debate over the validity of Internet business method patents by becoming a one-stop shop for prior art information exchange. Cella, a 34-year-old Kentucky native, says it will be a forum where anyone who questions a patent's validity can attract relevant prior art by offering financial incentives -- bounty payments that start at $10,000. Instead of simply complaining, for example, that Priceline.com founder Jay Walker doesn't have the right to patent the concept of a reverse auction, a critic could publish a document on BountyQuest proving that someone else thought of the idea -- and collect a nice chunk of change in the process.

Cella considers BountyQuest to be not just a potentially profitable business, but also a market-based example of reform. Jeff Bezos and computer book publisher Tim O'Reilly, two prominent Internet players who have fought with each other about the patent system, are serving as corporate advisors to the new Web site. Both men are also investors. (Bezos has contributed more than $1 million.)

But will BountyQuest actually make a difference? There were 2,600 applications for Internet business method patents last year, up from 700 in 1996. Can BountyQuest stem that tide, even as it contributes to the flow? Cella has already managed to win a patent for BountyQuest's own business method. Even O'Reilly isn't sure: "It's not enough," he says of BountyQuest, refusing to say how much he invested. "It's necessary but not sufficient."

Patents and the Internet are clearly a hot topic -- the BountyQuest site is already enjoying a wave of media publicity. Cella was eager to sit down with Salon to explain the site in more detail.

Many people have argued that companies shouldn't be seeking Internet business method patents because they limit innovation and run counter to the open, shared nature of the Net. So aren't you contributing to this problem by patenting your own business model -- which looks to me a lot like a simple B2B marketplace?

We see it as a question of: Do you have a patent system or do you not have a patent system? We definitely believe in having a patent system; we believe it encourages innovation. But patents are a double-edged sword. Every patent encourages innovation by restricting competition, so they're all good and all bad. The real question for us goes on a patent-by-patent basis, not a whole classification of type of patents, but rather, we look at each thing and see if it's valid or not.

And we believe what we have is unique. In fact, we think we're going to change the way that knowledgeable people around the world are rewarded for their information. We think that's a significant and important innovation. If it turns out we weren't first, we'll be the first ones to tell you. We're proving that by putting up a large reward on our own patent.

How much is that reward?

$14,159.

That's a bit of an odd number ...

It is an odd number, and there's a reason for it. Maybe this just proves we're geeks, but it allowed us to make the total bounties on day one $314,159, which are the first six digits of pi.

Really, though, we see [our own patent] as a way of putting it to the test. In our case, if someone knocks it out, it validates our business model and if they can't knock it out, it proves our patent so we're happy either way.

. Next page | Tim O'Reilly is putting up cash to bust Jeff Bezos' business
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