Q: What do these companies have in common?
- Boca Raton Resort & Club
- Burlington Coat Factory
- Continental Airlines
- Ford Motor
- The Green Bay Packers
- J Crew
- Kraft Foods
- Tire Kingdom
A: All of them have been sued for infringing a software patent. 
We are all members of the software industry, because we all use software every day.
“If you’re selling online, at the most recent count there are 4,319 patents you could be violating,” said David E. Martin, chief executive of M-Cam Inc., an Arlington, Va.-based risk-management firm specializing in patents. “If you also planned to advertise, receive payments for or plan shipments of your goods, you would need to be concerned [with] about approximately 11,000.” 
Independent invention is not a valid defense against claims of patent infringement. That is, a patent holder can sue anybody who has written a composition similar to a patented composition. The holder of a software patent need only spend a few minutes with an Internet search engine to find somebody to sue—which is why “software companies” like the Green Bay Packers and Tire Kingdom are being sued: their web site evidently implements something that seems to match one out of the above-mentioned thousands of patents.
Is your company, school, or organization infringing any software patents? If it has a computer on hand, then the answer is almost certainly yes.
So software patents have created liability for everybody. But have they spurred innovation? Nobody can find any evidence that they have; see the Resources for economists page for the list of pro-software patent scholars who have searched for evidence of benefit and failed.
A fast-growing bureaucracy
Imagine a government agency with the scope to inspect and grant a monopoly on every line of computer code written by anyone in any part of the economy, and you’ve got the US Patent and Trademark Office.
As you can imagine, granting so many monopolies requires a lot of resources: the PTO has grown out of its buildings and continues to expand, to the tune of 1,200 employees per year for the next five years. Even so, it will still have to stretch to catch up to its backlog of 1.3 million uninspected patents. [source]
1,200 new employees over five years equals 6,000 new hires. Coincidentally, the PTO in 2000 was about 6,000 people. So the PTO hopes to grow to more than double its size in 2000.
The irony of this effort to create a federal bureaucracy to oversee everybody’s computer code is that, as above, nobody has any proof that this computer code bureaucracy has spurred innovation. Even coders themselves oppose this government ‘service’—see the what practitioners are saying page.
Continental; Caterpillar, Green Bay Packers, Kraft foods; J Crew; OfficeMax, Sears, Walgreen; Ford and Wal-mart