Friday, November 21, 2014

Google and Android OEMs apparently close to settlement with Rockstar over ex-Nortel patents

About a year after the Rockstar Consortium's Halloween 2013 lawsuits against Google and a host of Android device makers, and only days after a $188 million settlement between Rockstar and Cisco became known, the most likely outcome is now that Rockstar's pending cases against Google and various Android OEMs will be settled at a relatively early procedural stage.

Four days ago, Rockstar filed an unopposed motion in its Google case (over search engine patents, which is separate from the Android cases) for a 45-day stay, which was subsequently granted. The motion said the following about the current state of affairs:

"[O]n November 12, 2014 a binding Term Sheet was executed that settles, in principle, all matters in controversy between the parties. [...] [T]he Term Sheet is [being] reduced to a definitive agreement. [The 45-day stay] is necessary due to the complexity of the transaction and the number of additional parties whose claims are concurrently being resolved."

There are no additional parties to the case over search engine patents besides Rockstar, its NetStar Technologies subsidiary, and Google as the sole defendant. However, there are many parties to the Android cases (devices makers like Samsung, LG, HTC, and ZTE), making a comprehensive settlement involving not only search engine but also wireless patents the only plausible interpretation of that passage.

Absent a settlement, all of the key issues in the Android context would be resolved in the Northern District of California, the venue preferred by Google and its partners. In the declaratory judgment action in California, a report was filed in early November, saying that the parties engaged in court-ordered mediation but reached no settlement. However, it is possible that the mediation meeting nevertheless had a positive effect. It probably also helped the parties to know in which court the infringement and validity determinations would be made.

It would be out of character for Google to make a huge payment at an early stage of a patent litigation (though there's always the possibility of something happening for the first time in history). It's also unlikely that pretrial discovery has given the parties definitive clarity about the likely outcome. So I can't imagine that the impending settlement would be a win across the board for Rockstar. The two most likely scenarios are either a win-win (Google and its partners can put this thing behind them for an amount that's worth it while Rockstar can produce some revenues that help the acquirers of Nortel's patents offset some of their costs) or a set of terms under which Rockstar lets Google and its partners off the hook at a rather low cost. Should the latter be the case, then it would most likely be attributable to dwindling support for Rockstar's lawsuits among its owners.

While no single shareholder (not even Apple, which contributed most of the funding) will be singlehandedly in the position to tell Rockstar's management what to do, it's possible that a couple of shareholders have demanded that those cases be settled. Protracted and potentially acrimonious litigation could have resulted in negative publicity for Rockstar's owners (a key difference between Rockstar and "patent trolls" who have no affiliation at all with any operating company).

Also, Rockstar's management and/or shareholders may have found Google's proposed terms more acceptable than initially. After all, smartphone patent lawsuits typically don't give plaintiffs tremendous leverage.

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Thursday, November 20, 2014

European Advocate General recommends to raise the bar for injunctions over FRAND-pledged SEPs

Last year, the Landgericht Düsseldorf (Dusseldorf Regional Court) referred a set of questions relating to injunctive relief over FRAND-pledged standard-essential patents (SEPs) to the Court of Justice of the European Union and stayed a Huawei v. ZTE litigation pending the CJEU's opinion. The hearing was recently held (I didn't attend due to my changed focus), and today the recommendations of Advocate General Melchior Wathelet were published. There is an English-language press release but not yet an English translation of the full document (at least not when I last checked). The official language of the proceedings is German, and that of the AG's recommendations is French.

Not all but most of the time, the European Court of Justice (which is what the CJEU is still referred to, now unofficially) adopts the AG's recommendations, and I believe that would be good news int his case.

I've read the recommendations, and here's my first takeaway:

  1. The AG's recommendations are consistent with the ways in which I have, for years, disagreed with the way German regional and higher regional courts applied the Orange-Book-Standard ruling by the Bundesgerichtshof (Federal Court of Justice) to cases involving FRAND-pledged SEPs. If the AG's recommendations are adopted, the bar for injunctions over FRAND-pledged SEPs will be raised far, far above the recent practice by German courts, and it will certainly not be lowered as compared to the practice by UK and Dutch courts. In the Netherlands, antitrust law was not previously applied to these cases, but this may now be the case going forward.

    The worst part of the German application of Orange-Book-Standard that the AG disagrees with is that some German courts restricted the rights of defendants to an unreasonable extent. Those judges said that if you want to benefit from a FRAND promise, you have to take a license and must not challenge the validity of the patent-in-suit (though most patents in this field are invalidated or narrowed when challenged) and cannot defend yourself against the infringement allegations--or else an injunction will issue. The AG's recommendations clearly leave all options to defendants. The approach by some German courts was "you pay up or else" and they denied injunctive relief only if a royalty offer was so high that there was no way the patent holder could have asked for even one cent above it.

  2. If the AG's recommendations are adopted, holders of FRAND-pledged SEPs can forget about the possibility of obtaining quick (sometimes within 10 months of filing a complaint) injunction orders by German regional courts over FRAND-pledged SEPs because a defendant will have the option to request a FRAND rate determination by a court or an arbitration panel and no injunction will issue in the meantime.

    The AG's recommendations require the patent holder to make a licensing offer to the alleged infringer, and the defendant to make a reasonable counterproposal, but in many cases both parties will take extreme positions with a view to a future FRAND determination.

  3. Relatively speaking, the best news here for SEP holders is that they will have the opportunity to argue in court against any claim or assumption that ownership of a SEP gives them monopoly power. This could be an opportunity for SEP holders to still obtain injunctive relief, but the hurdle is likely going to be reasonably high, especially if the standard in question is as key as UMTS or LTE.

  4. The AG's recommendations demonstrate a pragmatic approach and a good understanding of commercial realities by saying that implementers of standards do not have to seek a license prior to using the patents that read on it (because there's too many of them to reasonably expect anyone to clear and secure all rights beforehand): it's perfectly reasonable for companies to go ahead and implement a standard and to sort out licensing issues only if and when an infringement assertion is made. That is also a key aspect that some German judges viewed differently from the European AG.

  5. While the AG's recommendations do not endorse the most extreme interpretation of the European Commission's December 2012 press release on the Statement of Objections (SO) in the Samsung case, according to which a totally unspecified willingness to negotiate would have been sufficient for an infringer to avoid injunctive relief, they are materially consistent with the structure of the European Commission's settlement with Samsung. Due to the settlement, that matter never arrived at the CJEU, but the aforementioned press release was the key reason for which the Dusseldorf Regional Court prudently presented its questions to the CJEU. (By the way, the presiding judge who made this decision, Ulrike Voss ("Voß" in German), has meanwhile been promoted to the appeals court, the Oberlandesgericht Düsseldorf.) So in practical terms, this CJEU proceeding is also about the issues at the heart of the Apple-Samsung matter.

  6. In terms of whose parties' past behavior is endorsed, the AG's recommendations lend legitimacy to the pursuit of injunctive relief by Huawei (against ZTE) and Samsung (against Apple), even though the AG's recommendations would make it easy for defendants to avoid injunctive relief in the end. The AG does not comment on whether ZTE's 50-euro royalty proposal was reasonable, but between the line it's clear that it wasn't, and my guess is that ZTE will now seek a FRAND determination by a court of law or an arbitration panel. As for Apple, it's clear now that the positions Apple took in court in the Samsung cases were too extreme in several respects. Apple had basically argued that Samsung wasn't entitled to injunctive relief under any circumstances as long as Apple was willing to have talks (Apple's counsel said so explicitly in the Mannheim court), and that's not what the AG considers to be fair. AG Wathelet does believe that someone must be seriously interested in taking a license.

  7. Earlier today I wrote about the latest draft rules for Europe's future Unified Patent Court, which make injunctions a given in virtually all cases in which an infringement is identified. It's not clear to me how the Unified Patent Court would apply European law if (a) the current draft rules were adopted (which I hope and believe they won't) and (b) the AG's recommendations were adopted by the CJEU (which I hope and believe they will). Critics of the UPC have been saying for a long time that the CJEU should have the final say just the way the Supreme Court of the United States can overrule the Federal Circuit. What will the UPC do about FRAND? That question may very well come up at next week's hearing.

  8. The AG argues that holders of FRAND-pledged SEPs have less leverage than owners of patents that read on de-facto standard without FRAND rules. That's the basis on which he distinguishes cases like Huawei v. ZTE from the German Orange-Book-Standard case, in which there was no FRAND pledge. If there's anything in the AG's opinion that I don't consider good policy, it's this. It's effectively an incentive for standard-setters not to make FRAND promises in the first place. Maybe the AG was being very political here and was just looking for a way to avoid an outright disagreement with the Federal Court of Justice of Germany. By saying that Orange-Book-Standard shouldn't apply to FRAND-pledged SEPs, the disagreement between the European AG and German case law is limited to decisions by lower courts, but the result could be problematic. Some of this will affect future debates over European horizontal agreement guidelines.

I'll certainly comment on the CJEU's opinion when it is handed down. If I find additional interesting things in the AG's recommendations after re-reading them, I may blog about this landmark case again even before the actual ruling.

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Draft rules for European patent court: injunctive relief an automatic remedy for infringement

When then-U.S. Secretary of Defense Donald Rumsfeld made a distinction between the "Old Europe" and the "New Europe" (including countries like Poland), there was a lot of (understandable) outrage. Unfortunately, some of the people shaping Europe's patent policy are now pushing for a Stone Age approach that makes patent injunctions a given in any case in which an infringement is identified, more than eight years after the eBay v. MercExchange ruling by the U.S. Supreme Court and also running completely counter to the tradition of several European jurisdictions (such as the UK and the Netherlands) in which judges have enjoyed significant discretion concerning patent remedies.

At a time when U.S. case law has upped the ante for patent trolls in limited but useful respects and U.S. lawmakers (now that the Republican Party holds a majority in both houses of Congress) are preparing more anti-troll reform legislation for 2015 (which President Obama will almost certainly sign), Europe is going in the completely opposite direction. And while this was not enough, there had at least been some temporary improvement in the spring: the 16th draft rules (the draft before the latest one) at least contained some language reminiscent of the balance-of-harms eBay factor.

While I'm not involved with the related lobbying efforts (I haven't done any lobbying in more than seven years), I strongly suspect that companies with a failed or declining operating business in the ITC space like Nokia and Ericsson are responsible for this. I've also heard through the grapevine that a German official (from the Ministry of Justice, not a judge to be clear) has been a key proponent of troll-friendly rules.

I'm very surprised that the industry coalition that first raised concerns 14 months ago and reinforced its message earlier this year hasn't spoken out yet on the latest (17th) draft rules of procedure for the UPC, but it also appeare a bit slow in the past, though maybe it will still get something done in time for next Wednesday's official hearing in the German city of Trier.

Considering that the previous draft represented at least a step in the right direction, I was like shell-shocked when I read the following passage from the official explanatory notes for the latest draft:

"Where the Court finds an infringement of a patent it will under Article 63 of the Agreement give order of injunctive relief. Only under very exceptional circumstances it will use its discretion and not give such an order."

That's part of the explanation of the deletion of Rule 118.2, which referred to eBay-like considerations. So the intention is that all infringements will result in inunctions except "under very exceptional circumstances." Even "exceptional" would mean "very rarely," but "very exceptional" means "hardly ever."

There are cases in which injunctive relief is the most appropriate remedy for patent infringement. But many of today's technology products are so multifunctional that unlimited access to injunctive relief will give patent holders undue leverage. For example, if Mercedes, BWM or Audi had to stop manufacturing and distributing an entire car only because of a need to work around a patent covering a very minor feature of the navigation system, the cost of complying with a court order would far exceed the true value of the asserted patent. That discrepancy invites arbitrage by trolls.

Those who favor such rules don't work to protect innovation or to strengthen law enforcement. They may mean well (at least for their profession, though I'm not sure they even have the best in mind for the economy at large), but at the end of the day they pave the way for rampant abuse with disastrous economic consequences.

Europe has an innovation problem--Nokia is a good example. If Europe now tries to just strengthen patent enforcement for the losers in the marketplace (Nokia being the most extreme example), the net effect is not going to be more innovation. Instead, even more European innovators will emigrate to Silicon Valley.

While the deletion of Rule 118.2 (which should not only have been kept but even strengthened) is disconcerting, there is now some (but still very insufficient) progress in a related context--bifurcation. Rule 40 now says that if an infringement hearing is scheduled and an infringement case is not stayed despite an ongoing revocation action, "the judge-rapporteur of the panel of the central division shall endeavour to set a date for the oral hearing on the revocation action prior to the date of the oral hearing of the infringement action."

Obviously, "shall endeavour" is pretty weak, and the explanatory notes make this even clearer:

"New Rule 40(b) will not to acceleration in all cases where counterclaims for revocation are referred to the central division -- only cases where the parallel infringement action is not stayed will be accelerated; in practice, the synchronisation of the calendars remains within the discretion of the judge-rapporteur ('shall endeavour')."

(emphasis of "all" and "not" in original)

This is a step in the right direction but still unacceptable because it means parties to a dispute will have to negotiate a settlement without the defendant knowing for sure that the invalidity defense will be adjudicated before an injunction issues. The "injunction gap" is a real issue as I showed in my study of the final and preliminary outcomes of 222 smartphone patent assertions: there was not even one situation in all the German cases among the lawsuits I analyzed in which an infringement proceeding was stayed and a patent later upheld, but there were multiple cases in which a patent later invalidated by the Federal Patent Court of Germany was enforced for an extended period of time in each case (for example, Motorola got to enforce a synchronization patent against Apple for 19 months).

My analysis was smartphone-focused, but other studies with a broader focus have also shown that most European patents are actually invalidated or narrowed when they come to judgment in the Federal Patent Court of Germany. Last month I blogged about a study by a leading German IP law firm that raised the question of whether patents are merely "paper tigers." A few days ago an English translation of that study was published on the Bardehle firm's website.

In closing I'd just like to clarify that I'm not fundamentally opposed to the UPC or the Unitary Patent. In fact, my app development company filed three PCT applications this year and would love to choose "Unitary Patent" as a target jurisdiction for each of them at the end of the 31-month international phase. And apart from whether the Unitary Patent legislation will be ratified in time or not, I will want those patents to be enforceable Europe-wide. But true innovators need a fair chance to defend themselves against meritless assertions. I'd rather have to convince a court that an infringement causes irreparable harm to my business and that the covered feature is not just a minor feature of a multifunctional product, and wait for the outcome of a revocation proceeding before I obtain injunctive relief, than have to negotiate with countless patent trolls against the background of an unbalanced, backwards-oriented framework.

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Wednesday, November 19, 2014

Google supporters increasingly recognize flaws of overturned ruling in Oracle's Java copyright case

Google won't leave any stone unturned in its quest for a Supreme Court review of the Federal Circuit's appellate ruling holding Oracle's asserted Java API declaring code copyrightable. My first reaction to the cert petition was that, at least at this particular stage (where all that matters to Google is to get the Supreme Court interested), Google is essentially trying to salvage its reversed district court win on a "right for the wrong reasons" basis. Instead of claiming that there is an interoperability exception to copyrightability, it's now trying to generally raise the bar for software copyright, which creates all sorts of issues.

As if Google had never changed its strategy, various amicus curiae briefs in support of Google's petition for writ of certiorari are still harping on the old Sega/Sony theme. It's largely the same group of people and organizations as in the previous round. I can see why dozens of law professors are unhappy that the Federal Circuit didn't buy their pro-Google argument, but that doesn't make the appellate ruling erroneous in the slightest. Also, I don't think the arguments that people raise against the Federal Circuit now are any better than the ones the Federal Circuit had rejected.

One huge credibility problem the "cert" movement faces here is that it claims the sky is falling but in almost a year since the appellate hearing, at which Google was clearly on the losing track as knowledgeable observers unsuspected of being Oracle allies had also noticed, that anti-software copyright coalition hasn't really grown. The software industry is overwhelmingly on Oracle's side. Amici like HP (which has all sorts of issues, in and out of court, with Oracle), Red Hat (which has a business model that some like to describe as "symbiotic" but which is also in no small part parasitic) and Yahoo (whose CEO was the girlfriend of Google's CEO for a few years) don't counterbalance the support Oracle has from large software (and not just hardware and services) companies. The HP-Red Hat-Yahoo brief is also extremely weak. It basically argues that Oracle should have lost based on Baker v. Selden, a case that was not about verbatim copying but someone trying to monopolize a method by means of copyright and is therefore more than distinguishable from the Android-Java case.

Yesterday I spotted some tweets by critics of the Federal Circuit decision that I wish to briefly comment on. Aaron Williamson, now with a law firm and previously with the Software Freedom Law Center, reiterated his opinion "that Google should have won," but near-simultaneously wrote that "[t]he district court [for the Northern District of California] did sorta bungle [the] merger [doctrine]." (The merger doctrine says that copyright doesn't cover expression if it's inseparable from functionality because of a very limited number of options.)

In this regard, Mr. Williamson (with whom I once had a disagreement on Twitter about some IP issues) agrees with a blog post by another lawyer who once welcomed Judge Alsup's non-copyrightability holding: Tennessee-based (but virtually Californian) Rick Sanders cautions people against believing that only because the Supreme Court recently disagreed with the Federal Circuit on some patent issues, the Federal Circuit would necessarily be wrong on copyright. Mr.  Sanders recalls that he "had publicly supported the now-reversed trial court opinion" but conceded that there was a fundamental mistake--the juncture at which the availability of expressive choices should be determined:

"Only, it's not that simple, and to make it that simple, we have to make a fundamental mistake. It is true that the organization of the API library serves a function: to be intuitive to the 'community of programmers,' so they can easily find the API method they're looking for. But that doesn't make it automatically uncopyrightable, any more than an instruction manual is. If you're Google, then yes, there’s only one way to organize the library--Sun's way. But there's our big mistake. When it comes to copyrightability, we're shouldn't be interested in the actions of the alleged infringer--Google--but of the author, Sun. We shouldn't ask (as we mistakenly did) what choices Google had, but what choices Sun had."

Mr. Sanders then goes on to discuss the Math.Max function, which is not representative of the 7,000 lines of code at issue, but, at any rate, he recalls that "originality is a very low bar": "You just need a spark of human creativity to have an 'original work of authorship.'" That's a fact Oracle's brief on appeal emphasized. And if the Supreme Court declines to even look into this case in more detail, Google and its supporters can blame it on that low hurdle, which makes it obvious that the Java API declaring code can't be held uncopyrightable without a radical departure from a centuries-old principle of U.S. copyright law.

On that basis, Mr. Sanders concludes:

"One thing Oracle really had going for it--and this is emphasized in its appellate briefing--is the sheer size and complexity of the Java API library. Maybe it's mostly dictated by efficiency, but surely somewhere in there is a spark of creativity. Since Google copied the structure verbatim, it's reasonable to assume that Google copied something that didn't merge with the design principle."

In my view, there's not just one spark of creativity in the Java API declaring code. But the key thing is that Google's cert petition has a rather different focus than the district court ruling and Google's argument before the Federal Circuit, and some of the IP lawyers who for philosophical reasons liked Judge Alsup's non-copyrightability holding now concede that the district court's reasoning isn't defensible.

About a year ago at this time, Boston-based technology lawyer Lee Gesmer, who has been a neutral observer of the case as far as I can see, cautioned Google's supporters a few weeks before the appellate hearing that Google could lose on appeal (as it actually did). He was right that "[Judge Alsup's] decision does not give Google a lot to work with, and leaves some gaping holes for Oracle to aim for." That was true a year ago, and it's also going to be a problem for Google in the months ahead.

It's understandable that those supporting Google in this context are not in the best mood, and they don't have much of a reason to be optimistic because even if the Supreme Court decided to hear the case, the only realistic effect would be a delay--but not a complete departure from the principle that even minimally-creative (i.e., far less creative than the material at issue in this case) program code is copyrightable.

I've previously criticized the Federal Circuit bashing in which some of Google's friends engage, and I agree with Mr. Sanders that the reversal rate of recent Federal Circuit decisions in patent cases has nothing to do with this copyright infringement matter. But if you want to criticize the Federal Circuit, please have at least a modicum of respect. I've disagreed with judges from different jurisdictions on this blog but this tweet, which I saw yesterday, is an absolutely unacceptable form of criticism. It shows a video of a garbage truck that throws the waste from a bin onto a sidewalk and a front lawn. This tweeter, Timothy B. Lee, has been campaigning aggressively against the Federal Circuit for a couple of years. One of his more recent articles on Oracle v. Google has this headline: "The court that created the patent troll mess is screwing up copyright too." And that article is one of the "cited authorities" in the EFF's "computer scientists" amicus brief in support of Google's cert petition. Another writing by the same Mr. Lee is cited by the Public Knowledge brief. Again, we all have the right to disagree with judges and to criticize entire courts, but it's misguided to attribute Google's problems in this case to the fact that the Federal Circuit happened to be the appellate forum (because some patents were initially at issue in this case).

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Tuesday, November 18, 2014

Indian court reduces provisional royalty rates Micromax has to pay Ericsson in pre-trial phase

In March 2013 the Delhi High Court ordered India's leading Android device maker, Micromax, to make a deposit of FRAND royalties in order to avoid the injunctive relief Ericsson originally sought. For the royalties to be deposited, the court set provisional rates ranging from 1.25% to 2% of the price of a device, the percentage depending on which standards (ranging from "GSM only" to "EDGE + GPRS + GSM" and "WCDMA/HSPA") a device actually implemented.

The court has now published an order that came down last week and determined the provisional rates of royalties that Micromax shall pay directly to Ericsson (as opposed to a mere deposit) for the period between the filing of Ericsson's suit and the trial, which is scheduled for late 2015. Those rates are now significantly lower, which means Micromax's lawyers have managed to increase their client's short-term liquidity. The applicable provisional rates are now 0.8% (GSM only, or GPRS + GSM) and 1% (EDGE + GPRS + GSM, or WCDMA/HSPA), for the period until November 13, 2015. Thereafter, the 1% rate goes up to 1.1% for the following 12 months, and a further increase has been determined for the period after November 13, 2016, but it's rather doubtful that those rates will ever play a role since the parties will have more clarity after the trial and will then (if they don't settle anyway) likely seek an adjustment.

While this is a substantial reduction and useful to Micromax, these provisional rates are still far greater than royalty rates awarded by U.S. courts in a couple of key FRAND determination cases to other SEP holders (Motorola and Innovatio).

The court stressed that this set of royalty rates is "purely an interim arrangement and is not a determination of the FRAND rates for the Ericsson portfolio."

Since this is not a FRAND determination, the order does not address in any way the argument that Ericsson's royalty demands should be related to the price of a chipset implementing a given standard as opposed to the price of a complete, multifunctional device. About a year ago, the Competition Commission of India had expressed concern over Ericsson's royalty base.

In March it turned out that Ericsson had asked Micromax for substantially higher royalty rates than another local company, Saral.

This year the Competition Commission of India launched a second investigation of Ericsson's standard-essential patent licensing practices (in particular, certain conditions it tried to impose on an implementer of a standard).

Here's the court order on provisional royalty rates in Ericsson v. Micromax:

Order - Telefonaktiebolaget vs. Mercury - CS(OS) No. 442 of 2014 by Florian Mueller

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Friday, November 14, 2014

Buy one, get two free: the EFF's approach to amicus curiae briefs in Oracle v. Google

Six amicus curiae briefs in support of Google's petition for writ of certiorari (Supreme Court review) of the Federal Circuit ruling in the Android-Java copyright infringement case have been filed, as the official website of the Supreme Court indicates. Most of them include at least some signatories that are Google-funded and notoriously Google-aligned. Three (50%) of those briefs have a close connection with the (also Google-funded and notoriously Google-aligned) Electronic Frontier Foundation. I commented briefly on two of them last weekend. The third one was filed in the name of the Open Source Initiative, the (Google-funded) Mozilla Foundation and an advocacy group that recently hired an EFF staff lawyer to work on IP (and related) policy, and those signatories are represented by a law professor who was an EFF staff lawyer for some time.

I disagree with all those briefs, but in different ways and to different degrees. Some of the arguments are unconvincing and non sequiturs (for example, where they claim that fair use is an unacceptable basis for safeguarding interoperability), but what I dislike the most are cheap shots at the extremely well-reasoned Federal Circuit ruling. It's rather transparent that some hope to capitalize on what they believe to be antagonistic tension between the Supreme Court and the Federal Circuit going back to the days of Chief Judge Rader, who is no longer with the Federal Circuit and had no hand in the Oracle v. Google ruling anyway.

Rather than go into all of the things I don't agree with (because it won't matter if cert is denied, or it can, in the alternative, still be discussed should the Supreme Court not decline to look into this case), I just want to highlight a couple of things that I really--well, I'll try to put it diplomatically because there actually are some people involved with those briefs whom I respect tremendously (and even some whom I truly like and who do work on other issues that I'm indebted for)--so to put it nicely, I "struggle" with some of this.

As for the law professors' brief, no matter how hard I try, I can't see how it would be good and workable policy, enhance legal certainty or promote innovation to make copyrightability dependent upon the freedom of subsequent programmers who, because of their own decisions to copy, feel "restricted" in their choices. The law professors' brief seriously argues that this should be the measure. As a result, copyright as a whole would become a shifting-sands kind of intellectual property right where even the most creative work would be devoid of protection only because of whatever might happen (in unforeseeable ways) somewhere else much later. I'm thoroughly disappointed when I see non-parties to a case advocate stuff like that.

The thing I found most troubling about the "open source" (OSI, Mozilla, Engine) brief is that it talks for pages and pages about the benefits of open source software (yes, some very valid points are made in that context) but doesn't say a thing about the fact that Google elected not to use the Java material available under the GPL, a free (and open source) software license. Basically, the open source guys are saying that in order to protect open source, it must be possible to do closed-source derivatives. It's the most severe case of intellectual dishonesty and the least principled behavior I've seen in an IT industry debate in almost a decade. And not just that. It's also utterly ungrateful: Sun made plenty of Java code available under the GPL, and Oracle acquired it and has supported this ever since--only for some open saucers (a term humorously coined by The Register) to now argue that Oracle's defense of its rights threatens open source development. I have absolutely no respect for that, and it makes even less sense in a world in which more and more APIs become available on open source terms, such as in recent days the server components of the Microsoft .NET framework.

But before I get worked up over some people's less than principled stance, let me now end this post with some just-before-the-weekend fun. On Twitter, the EFF drew attention to a picture of 25 book covers: "Here are some of the books written by signatories to our Supreme Court brief in Oracle v. Google." Like I said before, there are undoubtedly some great people among the signatories of those briefs, but it all looks very orchestrated and there's clearly lack of support from the software industry (while other major software companies, including some of its direct competitors, back Oracle in this context). Anyway, since the EFF chose to show computer book covers in order to emphasize the industry expertise of its signatories, I thought I might, for the fun of it, show you the covers of the 12 computer books I wrote in the second half of the 1980s (the first two of them at age 16, the last two at age 19, and seven of them were published in Commodore International's official book series):

The day will come when I'll sign an amicus brief, too :-)

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Saturday, November 8, 2014

Yawn: amicus briefs in support of Google's API copyright petition to the Supreme Court have surfaced

For four years and almost three months, Oracle v. Google has been the most interesting smartphone IP case in my opinion. There were dramatic moments and revelations. There was excitement. When one judge issued a ruling that was unprecedented in terms of holding a vast quantity of highly original material non-copyrightable, I was shocked. There were certain periods, before and especially after that now-reversed decision, when I was pretty much the only guy in the blogosphere to talk about the case at all. But there were interesting developments all the time, even including Google's surprise departure from the central part of its previous argument (not a pleasant surprise from a software developer's point of view, but still, a surprise). However, his morning I experienced my first yawning moment in connection with this case: a couple of amicus curiae briefs supporting Google's petition for writ of certiorari (Supreme Court review) have surfaced, and they're just a rehash of what essentially the same (Google-aligned) groups had already told the Federal Circuit.

The Electronic Frontier Foundation, with which I do agree on various patent reform topics, has filed an amicus brief of computer scientists. Several of them are Google employees; some others are EFF board members. The "short" bios are longer than the brief itself. In 2012/2013 the EFF orchestrated a couple of amicus briefs to the Federal Circuit in the same context, and the fundamental flaw of its argument is still the same: it argues that API-related material must be "uncopyrightable" in order to enable interoperability and, as a result, technological progress. In response to (among others) those briefs, Oracle issued a comment last year regarding collective amnesia about Android not being Java-compatible.

The only gradual change from last year's amicus briefs is that they are now talking a little bit more about why they believe it's not acceptable to relegate, as Federal Circuit Judge O'Malley proposed, interoperability questions to the fair use stage of the analysis. They deny or at least seek to downplay the power of fair use. I read on Twitter that Professor Pamuela Samuelson (Berkeley), the EFF's vice chairwoman, has (like last time) authored an amicus brief by IP professors (one of the signatories mentioned it). Professor Samuelson herself explained the power of fair use extremely well in a 2009 paper entitled "Unbundling Fair Uses":

"It was also too early in the history of computer software industry for Congress in 1976 [when lawmakers decided to make computer program code subject to copyright protection] to have foreseen that developers of non-infringing programs would sometimes need to reverse engineer another firm's program in order to make their programs interoperate with the other firm's program. And the Internet and search engine technologies had yet to be invented in 1976. Fair use has proven quite useful in adapting copyright law in response to these and other new technologies so as to promote competition, technological innovation, and greater public access to information and ability to make use of content."

(emphasis mine)

That paper gives various good examples. By contrast, the examples in the computer scientists' EFF brief don't make sense to me:

  • They start with the original IBM PC BIOS. That one was binary and small. In any event, the primary reason why IBM compatibles came to dominate the world of desktop computing had nothing to do with copyright and everything with antitrust: after the mainframe consent decree, IBM was more cautious and allowed others to make compatible systems.

  • The UNIX API goes back to a time when copyright on computer programs in general was not yet established. And again, there were, or would have had to be sooner or later, antitrust considerations.

  • The C programming language and its standard libraries were much smaller than the Java APIs.

  • Internet and other networking protocols created by organizations like the W3C, which ensure free access by everyone, don't need to be devoid of copyright protection in order to be widely available: they're licensed to everyone for free.

  • The part about cloud computing is a non sequitur. For example, Eucalyptus (now acquired by HP) had a deal in place with Amazon, which the brief even mentions. Once again, this was implementation with the copyright holder's consent.

The latest brief submitted by industry group CCIA (with which I agree on, for example, design patent damages) is also compatibility/interoperability-centric. This means that both the EFF brief and the CCIA brief are still based on the same idea as Google's original argument in this case (the notion of an interoperability exception to copyrightability) but don't really support the substance of Google's certiorari petition.

Just like Google did before, the CCIA also talks about European law. This is basically an attempt to urge the Supreme Court to achieve some kind of transatlantic harmonization. However, there are undeniable differences between the systems, and it's the prerogative of lawmakers, not the courts, to decide whether there should or should not be cross-jurisdictional differences. The CCIA says the following about European lawmakers' intent:

"In 1991, the European Union adopted a Software Directive, which reflects a policy judgment that copyright should not interfere with interoperability."

If what you want is a policy judgment, then Capitol Hill is indeed the right part of the right city to push for it, but you've just chosen the wrong building. The Supreme Court of the United States is concerned with proper interpretation of what Congress decides, and not with making policy judgments for Congress.

I'm not going to discuss the frequently-cited SAS Institute v. World Programming case in detail for now. Suffice it to say that some people blow out of proportion what it meant for copyrightability and that European law is much less flexible in connection with fair uses than U.S. law. I may talk about it some more on some other occasion.

It's clear and obvious that Google and its amici have only one major goal at this stage: to get the Supreme Court interested in taking a closer look at the case. But the kinds of people and organizations who are pushing for this are the same as before, which suggests to me that the Federal Circuit decision didn't shock the software industry at all (contrary to what Google's amici say).

In an article on Google's cert petition, Thomson Reuters/Westlaw quotes Denise Howell, the host of This Week in Law, as saying that the Supreme Court usually likes cases "to be resolved in the lower courts before deciding to engage" (and here, there still is a "fair use" defense to be adjudged). That's another interesting reason for which the cert petition could and perhaps should be denied. To me, the most important reason is that the Federal Circuit decision just affirmed longstanding principles and it wouldn't be possible to deny copyrightability to those 7,000 lines of highly creative Java API declaring code without enormous collateral damage to software copyright as a whole. For more information on the case, please check out my recent post on the most widespread misconceptions surrounding it.

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