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Intellectual Property Litigation

SCOTUS Saves Google Billions By Finding its Copying of Oracle Software was Fair Use

The copyright case of the century Google v. Oracle has been resolved – in Google’s favor.  The SCOTUS decision was 6-2 with Barrett not voting since she was not on the bench for oral argument.

VERY BRIEF AND STRIPPED DOWN VERSION OF FACTS: •

1990 – Sun Microsystems developed Java programming language critical to operation of many systems It included a new programming language, a virtual machine, and a set of libraries for use with the language. 1995 – Sun made the source code freely available to programmers through a Community License but required that products using the code were maintained to the Java standard, and that any commercial derivative works were licensed by Sun. So while anyone could program in the language itself, Sun maintained the Java Platform and the Mobile Edition libraries. 2009 – Oracle then acquired Java when it acquired Sun for $4.4 Billion. •

2003- Android, Inc is formed to develop a new mobile operating system. Google buys it in 2005 and decide it wants to use Java and its Application Program Interfaces as part of the system. They offer Sun between $30-50MM but can’t reach a deal over control over the software as Google wants to make it impossible for others to use Google’s version of Java. Sun objected as that ran counter to tis philosophy of “Write once, run anywhere.”

Google says “We’re gonna use it anyway then since we deem it’s a necessary part of the  free license you gave away.”   Oracle sues.

Procedural History

•On August 13, 2010, Oracle sued Google for copyright and patent infringement in the District Court for the Northern District of California. Oracle asserted Google was aware that they had developed Android without a Java license and copied its APIs, creating the copyright violation.  (also claims of patent infringement which I will not discuss) •Copyright claim goes to trial. Jury finds for Oracle but judge overturns saying APIs not copyrightable “So long as the specific code used to implement a method is different, anyone is free under the Copyright Act to write his or her own code to carry out exactly the same function or specification of any methods used in the Java API.” •2014, Federal Circuit Court (because patents were involved) ruled in favor of Oracle saying the APIs were copyrightable as they were original and creative but remanded for re-trial on issue of Google’s “fair use” defense. •2016, jury finds that Android does not infringe Oracle-owned copyrights because its re-implementation of 37 Java APIs was protected by fair use defense. •2017, Fed Circuit again finds for Oracle. Google’s use of API had not met any of the four current criteria for fair use,  but was merely untransformed reuse. It had not been transformative, since it was used for the same purposes without even minimal changes or rewrites. It was not minimal, since it was agreed that only 170 lines of the 11,500 lines copied were needed for Google’s purposes. Furthermore just because there was no charge  for Android does not mean that the use was not commercial. •Remanded to District Court for trial on damages (which would be in the multiple billions)

•SCOTUS granted certiorari 2019

Decision

Writing for a six-justice majority, Justice Stephen Breyer held that Google’s copying of the Java API calls was permissible under copyright’s fair use doctrine. The high court chose not to decide the key question in the case: Whether APIs can be copyrighted in the first place. But the court’s fair use reasoning was broad enough that it should provide a strong defense for most API copying, making the question of API copyrights much less important – now that SCOTUS has so ruled.

That was the biggest beef in Justice Thomas’ (joined by Justice Alito’s) well-reasoned dissent. Thomas intimated that the majority side-stepped the issue because it knew that if it specifically found API protectable, it would be hard if not impossible to rule for Google. Thomas pointed out that Congress specifically passed legislation making computer code copyrightable whether it was used directly or indirectly in programming. Thomas further found that Google’s use was not transformative ( a fair use factor) but merely derivative and derivatives of copyrighted works cannot be made without license or permission of the original copyright holder.

Conclusion

The ruling means that Google will not owe Oracle billions and billions of dollars in damages. It also has big implications for the broader software industry, since a ruling in the opposite direction would have likely set off a wave of lawsuits against software companies that re-implemented other companies’ APIs.

In the final analysis, I think the majority found a bit of a tortured way to get to this conclusion to avoid just that. At first blush -and without a full deep read into the arguments and cases set forth in the majority and dissent – it looks to me like a straight and strict reading of the statute makes APIs copyrightable and Google’s use derivative, but it would uproot and disrupt coding and software so much too rule so that SCOTUS had to view the fair use factors in a way to come out in Google’s favor.

Smarter brains in tech and tech law than I will soon opine on this and I will follow the discussion along to see how it all shakes out.

Follow me on Twitter @oscarmichelen

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