Kickstarter boots rival patent into touch

A US court has found in favour of crowdfunding website Kickstarter by ruling that a patent covering a method for raising money is invalid.

The ruling, handed down by the US District Court for the Southern District of New York yesterday, June 29, brings to a close a four-year dispute between Kickstarter and a rival company called ArtistShare.

ArtistShare, which connects artists and fans to “fund the creation of new artistic works”, claims to have created the internet’s “first fan funding platform”.

The company was awarded a patent covering its invention— US patent number 7,885,887—in 2011.

The patent’s abstract said it is “directed to a system and method for raising financing and/or revenue by artist for a project, where the project may be a creative work of the artist”.

ArtistShare had attempted to license its patent to New York-based Kickstarter but Kickstarter refused and instead sued ArtistShare in 2011. Kickstarter sought a judgment that the patent was invalid because it did not cover patent-eligible subject matter.

In 2012, ArtistShare tried and failed to have the case dismissed on the grounds that the dispute concerned a business negotiation with no threat of litigation.

But the case proceeded to trial, which concluded yesterday when Judge Katherine Failla accepted Kickstarter’s claims.

“A careful read of that patent and of recent decisions on patent eligibility from the Supreme Court and the US Court of Appeals for the Federal Circuit makes plain that the ‘887 patent claims only the abstract time honoured concept of patronage,” Failla wrote in her judgment.

“At best the claims describe the use of the internet or a computer network to make identifying and soliciting funds from potential patronage easier and more efficient,” she added. “For the foregoing reasons the patent is drawn to patent-ineligible subject matter.”

Neither Kickstarter nor ArtistShare had responded to WIPR’s request for comment at the time of publication, but we will update the story should the companies get in touch.

However, Kickstarter’s deputy general counsel Michael Rosenn told news publication Motherboard: “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.”