BT has lost the first round of its courtroom battle to establish ownership (in the US) of the hyperlink technology employed on the Web.

An initial court ruling narrowed how BT can present and defend its claim to have invented hyperlink technology. BT is competing in court against Prodigy Communications, a giant US ISP.

Federal Court Judge Colleen McMahon issued a 38-page opinion in the pre-trial discovery phase of the case. This weeded out some BT terminology and phrasing the company was hoping to use to support its claims.

The judge ruled on the disputed definitions in the patent, the so-called Markham phase of the process. The next stage is to debate the claims for originality the patent makes.

BT and Prodigy have until April 12 to file motions for summary judgement. The joint pre-trial order is due July 15, and the final pre-trial conference will be held on September 6, Judge McMahon said.

Patent property BT contends its Hidden Page patent, patent number 4,873,662 filed in the US in 1976 and granted in 1989, gives the company the intellectual property rights to the hyperlink technology.

Hyperlinks connect text, images, and other data on the Internet in such a way as to allow a user to click on a highlighted object on a Web page in order to bring up an associated item contained elsewhere on the Web.

BT filed suit in December to protect the patent, which it claims covers the invention of the hyperlink technology used in Web pages.

BT claims hyperlink patent technology originated from general research done on text-based information systems, including a system called Prestel, by an employee of the General Post Office (GPO) in the 1970s.

BT contends that though Prestel is at best a primitive online information system, it can still prove its claims of prior art.

Web inventor Tim Berners-Lee is generally credited as leading an effort, with Robert Cailliau, to write the underlying protocols - including HTTP (Hypertext Transfer Protocol) – for what later came to be known as the World Wide Web, at the CERN nuclear research centre in Switzerland in the late 1980s. Berners-Lee's work was based on, among other things, earlier work carried out by Ted Nelson, who is generally acknowledged to have coined the term hypertext in his 1965 book, "Literary Machines."

The US patent does not expire until October 2006, though BT found that similar patents were filed in other countries but have since expired. BT said that in early 2000 it hired technology development and licensing company Scipher to broker licensing agreements with the ISPs (Internet service providers), and wrote to the "17 top US ISPs" asking to be reimbursed for the use of the technology.

BT has said it would not pursue patent claims with individual users, as it would "not be practical."

Analysts believe that should BT successfully defend its patent, the company stands to make tens to hundred of millions of dollars.