And they are suing developers who have included this feature in their iPhone apps.
Patent 7,222,078 describes a method that seems too abstract to summarize adequately. Here's the abstract:
Methods and systems for gathering information from units of a commodity across a networkSeems pretty vague to me. The salient point for iPhone developers seems to be around Claim 24:
In an exemplary system, information is received at a central location from different units of a commodity. The information is generated from two-way local interactions between users of the different units of the commodity and a user interface in the different units of the commodity. The interactions elicit from respective users their perceptions of the commodity.
24. The system of claim 1 wherein the two-way local interactions comprise a transaction for sale of a product or a service contract for the commodity.As far as I can tell, that's what Lodsys is using as they sell licenses for in-app "buy" buttons.