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Friday, July 02, 2004 - Page updated at 12:00 A.M.
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WaMu seeks patent for its "banking stores"

By Blanca Torres
Seattle Times business reporter

Central to Washington Mutual's "Occasio" design are "teller towers" that allow more interaction between customers and employees. Here, Kelly Tortorice works at her teller tower in downtown Seattle.
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When Washington Mutual applied for a patent to protect the way it designs its branches, it wanted to keep other banks from copying a layout it says has revolutionized customer service.

The bank's patent, announced last week, describes the branches as "retail banking stores" that are oval or circular and include such features as a concierge desk, kids' play area and "teller towers" that allow more interaction between customers and tellers.

"We have had tremendous success with the concept," said Karen Curtin, Washington Mutual's senior vice president of innovation and customer insight. "It gives us a competitive edge."

Getting the patent is a resourceful, if unusual, approach, experts say, but they doubt it will stave off competition or prevail in court.

"It's allowing them to put a stake in the ground and say, 'You can't copy us,' " said Michael Stein, a patent lawyer with Woodcock Washburn in Seattle.

Regardless of the validity, for another bank to violate the Mutual's patent, the competitor would have to implement every one of its provisions.

Richard Nolan, a business professor at the University of Washington, said it would be rather easy to find ways to emulate the concepts without breaking the law.

Patent highlights

Descriptions of Washington Mutual's Patent for its "Occasio" design include:

System to process financial transactions for customers


Three or more freestanding and spaced-apart teller podiums arranged in a circular, semi-circular or oval

Concierge desk near the entrance

Automated teller cash dispenser at one or more of the teller podiums or on a wall

One or more check-writing ledges

One or more teller back counters

Kids' area

Concierge and teller podiums situated to steer customers toward the teller podiums

Source: U.S. Patent 6,681,985

"This is something that you do because it is just good business, but as far as being a slam dunk for stopping the competition — no way," he said. "You just have to change it enough as to not completely copy the idea."

Other banks, regional and national, have implemented similar strategies over the years.

Portland-based Umpqua Bank began luring customers with free coffee and Internet access in 1995. Bank of America began tossing around ideas to improve customer service a few years ago. It has added greeters and waiting areas with televisions and newspapers.

The design — called Occasio, which means favorable opportunity in Latin — was installed in 2000 in Las Vegas and is now used in nearly half of the 1,800 branches.

Even if the patent is ineffective, Stein says, the bank has come up with a "very creative strategy."

"There's some marketing benefit to it," Stein said.

Some customers like the way Washington Mutual's design breaks with convention. Others aren't so sure.

"It's definitely not like any bank I've been to before," said Brian Motto, 27, of Seattle. He thinks of the Washington Mutual on the corner of Fifth Avenue and Union Street as a "bistro/bank" because it offers refreshments and snacks. "It's a more relaxed atmosphere. It makes it a little more enjoyable."

Jerret West, 28, of Seattle, called the layout fantastic but said he would still consider other banks.

"For additional services, (the layout) doesn't make much of a difference," West said. "It might be first place I would look since I feel comfortable asking questions here."

One customer, Eileena Russell, 30, of Seattle, said the layout is "like a maze."

"It's colder, it's not inviting."

Many banks recognize customer service is one of the key factors in their success.
A children's play area is part of the informal design for WaMu's branches. The design is now used in nearly half the bank's 1,800 branches.

Ray Davis, president and chief executive of Umpqua Bank, says customer service has helped the bank grow from six branches and $140 million in assets to 95 branches and $4.7 billion.

Umpqua operates in Oregon, California and Western Washington, including an office in Bellevue. It plans to open retail branches in the Seattle area within the next year.

The bank adopted the retail and consumer-driven approach by adding computer cafes to its branch stores, with Internet access and free cups of Umpqua's own blend of coffee.

Ten years later, some branches have taken more of a community-center approach. Umpqua's "branch store" in Portland's Pearl District offers free Friday-night movies, yoga classes and home-improvement workshops on topics like "How to design a loft."

"What we felt we had to do is differentiate ourselves," Davis said. "The world of bank branches is changing dramatically. You have to have a compelling reason to go to a bank. It's got to be a place you like to go."

Davis said Washington Mutual's patent will not change his company's strategies. "We're not going to copy (Washington Mutual)," Davis said. "In a lot of ways, they've copied us, which I think is a compliment."

Within the past year, Bank of America has gone the retail route, developing its own branch blueprint. In addition to greeters and waiting areas with TVs, branches offer computer kiosks and space for seminars.

"It's designed to be a very warm, welcoming environment," said Harvey Rosin, spokesman for Bank of America.

The bank has implemented the concept in about 150 of its 5,700 branches.

"We truly want to be a retail establishment," said Diane Wagner, the bank's vice president of retail-banking store initiative.

The fact that Washington Mutual gained a patent will not lessen Bank of America's efforts.

"(The patent) is a compliment to what they've already created," Wagner said. "We have already established what we want to do."

Patents don't adequately protect intellectual property, experts say, because the U.S. patent system was designed for products of the industrial era.

In a book for fall release, "How Our Broken Patent System Is Endangering Innovation and Progress and What To Do About It," authors Adam Jaffe and Josh Lerner argue that the patent-approval system is overloaded, leading to more approvals for the sake of fast processing. They say almost anyone can win approval.

The patent system also is underfunded, Stein said, and patent officers rarely have the training or expertise to evaluate different types of applications.

"I've seen lots (of patents) that in my opinion shouldn't have been granted," Stein said. "Most companies are sophisticated enough to know that not every patent that's issued is valid, and they're not going to let an invalid patent stop them from doing what they want to do."

Blanca Torres: 206-515-5066 or

Copyright © 2004 The Seattle Times Company

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