Oracle v. Google: The Federal Circuit goes all-in on copyright and software

By Jason Rantanen

Oracle America, Inc. v. Google LLC (Fed. Cir. 2018) Read opinion

Panel: O’Malley (author), Plager and Taranto*

This is a huge decision on multiple levels, and the latest exchange in the long-running battle between Oracle (the copyright owner) and Google (the alleged infringer).  In the first appeal, the Federal Circuit rejected Google’s arguments that the Java “packages” at issue were unprotectable under copyright law.  The court remanded the case for further proceedings on Google’s fair use defense.  (15 U.S.C. § 107)  On remand, the district court held a jury trial on that issue.  The jury found in favor of fair use and the district judge denied Oracle’s motion for JMOL.

Oracle appealed and the Federal Circuit reversed, essentially going all-in on the issue of copyright infringement when it comes to software. First, fair use is a question that is largely addressed de novo by appellate courts, and second, when it comes to software, the court’s analysis all but says (expressly so!) that fair use can never apply.  This opinion comes on the shoulders of the same panel’s previous opinion concluding that Oracle’s API packages meet the requirements for copyright protection.  I see the court as going “all in” here both by its adoption of a nondeferential standard of review (keeping in mind that Ninth Circuit law is controlling), as well as the combination of its conclusions on protectability and inapplicability of fair use in this context.

Standard of Review

In a detailed discussion of the standards of review, the Federal Circuit concluded that, under Ninth Circuit case law:

  • the jury role in determining whether fair use applies “is limited to determining disputed ‘historical facts’ not the inferences or conclusions to be drawn from those facts” (Slip Op. at 24); “[a]ll jury findings relating to fair use other than its implied findings of historical fact must, under governing Supreme Court and Ninth Circuit case law, be viewed as advisory only.” (id. at 26).
  • we must assess all inferences to be drawn from the historical facts found by the jury
    and the ultimate question of fair use de novo, because the Ninth Circuit has explicitly said we must do so.

This framework should be familiar: it’s essentially the same approach that the court takes in reviewing nonobviousness determination, a fact that did not escape the court’s notice.  Slip Op. at 25, n. 4.  Since the meat of the fair use analysis is in the inferences drawn from the historical facts and the balancing of all the factors, the functional result of this standard of review was that the court largely reviewed the fair use determination de novo.

Fair Use Analysis

Much will be written about the court’s fair use analysis; most of it more insightful than anything I can offer.  The court’s analysis draws heavily on Ninth Circuit caselaw.  Here’s the gist:

  • Factor 1 (Purpose and character of the use): The Federal Circuit concluded that Google’s use was (a) Commercial; (b) Non-transformative.  In addressing the “commercial” aspect, the court drew heavily on the reasoning of Harper & Row and Am. Geophysical Union, and barely mentioned Campbell.  On the question of whether Google’s use was transformative, the court applied this requirement: “To be transformative, a secondary work must either alter the original with new expression, meaning, or message or serve a new purpose distinct from that of the original work.”  Slip Op. at 31.  There’s a lot of grist to grind here in the inevitable Supreme Court appeal.  Bad faith didn’t play a role because (1) it’s one-directional, weighing only against a finding of fair use, and (2) there was no basis for disturbing the jury’s implicit finding of no bad faith.
  • Factor 2 (Nature of the copyrighted work): The Federal Circuit concluded that this factor did weigh in favor of Google, but it was the only one that did.  Here, while the Java API may have met the minimum requirements for copyright protection, “reasonable jurors could have concluded that functional considerations were both substantial and important.”
  • Factor 3 (Amount and substantiality of the portion used): The Federal Circuit concluded that Google did not duplicate “the bare minimum of the 37 API packages, just enough to preserve inter-system consistency in usage,” thus copying only “only so much as was reasonably necessary.”  Instead, the court concluded: “We disagree that such a conclusion would have been reasonable or sufficient on this record.”  (Slip Op, at 46).  Furthermore, “(e)ven assuming the jury accepted Google’s argument that it copied only a small portion of Java, no reasonable jury could conclude that what was copied was qualitatively insignificant, particularly when the material copied was important to the creation of the Android platform.” (Slip Op. at 47)  (Is the court really saying that because the copied material was functionally important, therefore its copying was not fair use?)
  • Factor 4 (Effect upon the potential market): Either the most important factor or an equally important factor; maybe we’ll get more clarity on this in a Supreme Court opinion in this case.   This is basically the derivative/licensed market issue, which commentators can go in circles about.  The short of it is that the Federal Circuit reversed the district judge, agreeing with Oracle that the market harm was “overwhelming.”

Balancing: applying its de novo standard, the Federal Circuit concluded that Google’s use was not fair use.  “There is nothing fair about taking a copyrighted work verbatim and using it for the same purpose and function as the original in a competing platform.”  (Slip Op. at 54).

All that said, the court concludes by refusing to say that fair use can never apply to software–although it’s statement simultaneously declines to cross that line while implying that’s what it’s reasoning leads to:

We do not conclude that a fair use defense could never be sustained in an action involving the copying of computer code. Indeed, the Ninth Circuit has made it clear that some such uses can be fair. See Sony, 203 F.3d at 608; Sega, 977 F.2d at 1527-28. We hold that, given the facts relating to the copying at issue here—which differ mate-rially from those at issue in Sony and Sega—Google’s copying and use of this particular code was not fair as a matter of law.

Stay tuned for the en banc petition–or perhaps direct request for certiorari.

*Note that this is the same panel as decided the earlier appeal in this case.  See 13-1021.Opinion.5-7-2014.1

Prior posts:

 

42 thoughts on “Oracle v. Google: The Federal Circuit goes all-in on copyright and software

  1. 9

    Has Ned left us?

    1. 9.1

      He mentioned to MaxDrei the other week about a recent surgery.

      For the grief that he brings, I do hope that is alright.

      1. 9.1.1

        I hope he is OK too.

          1. 9.1.1.1.1

            SCOTUS goes through phases in referring to natural rights. I think we are in a no reference phase.

            The colonies encouraged bearing arms because of fear of Indian attack. That possibility does not exist today.

            1. 9.1.1.1.1.1

              Your reason does not reach the aspect of the article.

              Your wanting a “justification” does not comport with the essence of the aspect of personal property (there need not be ANY justification) in view of the limited government.

              1. 9.1.1.1.1.1.1

                I am not sure that making bearing arms an obligation is an aspect of limited government.

                I live in Boston. We’ve never had limited government here — right from the earliest days of the Massachusetts colonies.

                Dierker has an extremely confused idea of the frameworks of the early modern political philosophers like Hobbes and Lock.

                Dierker is describing natural liberty (in Hobbes view) to own a gun. For Hobbes natural law is developed through the application of reason.

                Locke identified three basic rights: life, liberty, and property.

                A right to bear arms might be derived from those three rights, but Locke never made such a derivation.

                I don’t really have a dog in this race because as an engineer I only care about making a working system.

        1. 9.1.1.2

          Since this particular storyline is well “below the fold,” I though that you might like a link to it here:

          link to patentlyo.com

          1. 9.1.1.2.1

            I am not sure how that ABA formal opinion applies to Ned because he does not seem to work for a law firm and is not in the business of representing clients. Ned seems to be a principal at Alliacense, which is an Intellectual Property Management firm, which partners with firms like MCM Portfolio that hold significant IP or hope to develop significant IP. Fountainhead IP, which is an obvious reference to Ayn Rand, seems to be an alternate legal face of Alliacense.

            I am curious because I (a patent agent and not a lawyer) and other lawyer relatives are in the situation, where we have essentially one mission — to move heaven and earth to make sure that the crooks at the USPTO issue the patent applications and don’t invalidate the patents held by a family trust.

            Are direct or indirect beneficiaries of a trust in an attorney client relationship when they represent the trust in court? None of us are actually being paid by the trust even if we are attorneys or a patent agent for the trust.

            1. 9.1.1.2.1.1

              One does not need to work for a law firm in order to have a client. This working “in-house” have but a single client (but it is a client nonetheless, and leastwise as to the application of ethical rules).

              I have brought this point up before directly in conversations with Ned: he was unable to have a full and inte11ectually honest discussion on the merits because to do so would mean that he would have to acknowledge the weakness in his position, and his position was a “professional” one.

              This is also why I have pointed out (numerous times) that the “rules” (albeit unevenly enforced as they are) required that all opinions being expressed in the comment sections were to be personal opinions.

              I pointed this out not only because those such as Ned were advocating on NON-personal grounds, but others suspected of being paid to propagandize a position (certainly Malcolm has long been suspected of this) would also be barred from the (even) enforcement of such a rule.

              NONE of these are new points.
              Each of these have been shared in past “let’s have a better ecosystem” discussions.

              1. 9.1.1.2.1.1.1

                others suspected of being paid to propagandize a position (certainly Malcolm has long been suspected of this) would also be barred

                In fact, merely being suspected of doing something that you aren’t actually doing doesn’t have any legal consequences.

                1. Key word there:

                  “merely”

                  …and your view of the rest of the story…?

                  You know – ethics…

            2. 9.1.1.2.1.2

              As to your duties (as a patent agent) that arise under legal ethics, this too is a fascinating topic (and one that has been under-served on a blog that has a dedicated ethics page at that).

              As far as I can remember, the patent agent exam does not cover legal ethics (nor does it even cover contracts or torts).

      2. 9.1.2

        I didn’t see that. I hope everything is okay.

  2. 8

    Roger McNamee: “The reality is that libertarian values are extremely convenient for tech startups. I mean, ‘Move fast and break things’ is a pretty sociopathic motto.”

    Indeed it is. These same glibertarian s0 ci0 paths have been gleefully breaking the patent system for quite a while now.

      1. 8.1.1

        translation: “Oh N O E S, someone wants to (gasp) make money

    1. 8.2

      Do you inform your “clients” that you have this bizarre adverse view regarding innovation?

      1. 8.2.1

        Do you inform your “clients” that you have this popular and reasonable view regarding patents on methods of applying logic to data?

        Generally not because my clients aren’t in the business of blowing vapor out of their arses and asking me to scriven it into a patent claim.

        1. 8.2.1.1

          That wasn’t the question.

          Try again.

    2. 8.3

      Also MM if you look at the structure of what they are doing it is one where the CEO and a few select people can work 20 hour days because they are making many millions. They can burn out in 5 to 10 years and take time off as they will be very rich.

      What happens is the culture is supposed to be that of the person making the millions and burning out to get those millions to retire within 10 years.

  3. 7

    What a waste of time and money! It’s hard to see why the court even bothered to remand for a jury trial if the jury’s judgement was going to be “viewed as advisory only” and reviewed “de novo” on appeal. Having had to answer a number of jury summons and spend time sitting on three juries, nothing urks me more than having to waste valuable time as a juror for something that turns out to be a formal ritual. Don’t misunderstand, I believe in the right to a jury trial and will do my duty as a citizen in serving on a jury when called upon, but this case looks like the court trying to substitute its own opinion in place of the jury, such that the jury then becomes merely a matter of form.

    1. 7.1

      It is depressing Mark.

  4. 6

    Hey, Silly Con Valley Bros, here’s my s00 per d00per awesome idea: a system of linked computers that automatically write patent claims that describe how to drive a car in the snow. And when the computer gets stuck, a remote operator will be alerted to draft the claims instead of the computer.

    Can I haz patent now?

  5. 5

    link to bloomberg.com

    Gradient Ventures, an early-stage venture fund within Google, is leading a $6 million investment in a new company that’s building software to let humans control cars remotely. Scotty Labs, a nine-person startup, works on “teleoperations,” an emerging slice of the autonomous vehicle business that may grow more critical as the field faces closer scrutiny.

    California recently moved to let companies test driverless cars on public roads with remote human operators, starting in April. Scotty’s technology is designed for new regulatory environments like this. When a self-driving car [<—-LOLOLOLOOLOLOOLOLOLOLOL] finds itself in a tricky situation – stuck in snow, or behind a truck for instance – it alerts a trained operator in a call center who takes over.

    ROTFLMAO

    Would love to see the junk patents on this “system”. Silly Con Valley Bros please keep the laughs coming! $6 million dollars worth of chuckles here. Bionic remote controlled chuckles.

    Maybe we can outsource our car driving to India.

    LOLOLOLOLOLOLOLOLOLOLOLOL

    1. 5.1

      Bet you wouldn’t laugh if an autonomous drone that sometimes has a human remote pilot dropped a GBU-31 JDAM down your chimney.

      It takes a huuugestretch to imagine that technology working on a Toyota Camry…..

      1. 5.1.1

        Bet you wouldn’t laugh if an autonomous drone that sometimes has a human remote pilot dropped a GBU-31 JDAM down your chimney.

        Very serious, Martin! Really compelling stuff.

      2. 5.1.2

        that technology working on a Toyota Camry…..

        Because flying around in the open air is just like finding a parking spot in downtown NYC during rush hour.

        Keep drinking the kool-aid, Martin.

      3. 5.1.3

        Enjoy that swagger Marty.

    2. 5.2

      Maybe we can outsource our car driving to India.

      Would any such outsourcing be a “substantial portion” [note, not a substantial portions] of a claimed method…?

    3. 5.3

      Outsourcing the driving to India (or anywhere) in the abstract would be an ok idea if it did not involve “outsourcing the safety”. Like for example, whatever happens to you in your remotely controlled car would immediately happen to the remote driver… should they make a mistake and well paralyze or kill you.

      One reason I feel somewhat safe on an airplane is the thought that the pilot herself also does not want to die… this is why I will never step into a vehicle piloted by someone who is sitting safely in some remote location who knows where, and will never step into a vehicle piloted autonomously.

      Interestingly, perhaps your so called SCVB’s like the idea of outsourcing liability to India …. the system switches over to a poor hapless manual operator … of an arms length contractor company in India … just before impact/death… hey it might not stick every time but its worth a shot. No?

      Whatever happens, looks like the only thing NOT being outsourced anytime soon, is the Absurdity of it all.

    4. 5.4

      “Maybe we can outsource our car driving to India.”

      Don’t tempt them.

      1. 5.4.1

        Yeah. Since signals come out of nowhere and aren’t manufactured they aren’t real and cant be imported. So, no infringement.

        1. 5.4.1.1

          In re Nuitjen is seriously not in accord with reality.

          It is, however, currently controlling law.

          I will also note that “signals” per se lack copyright protection (even if Big Hollywood and Big Media want it otherwise), given as taking the “logic” of signals NOT being manufactures to its logical step, that any such signals must fail the “in a fixed media” requirement of earning copyright protection.

          One cannot earn a copyright that is not fixed in a tangible media – ergo, anything that falls outside of patent eligibility based on the In re Nuitjen reasoning, also lacks a prerequisite for copyright protection.

  6. 4

    In Java language, interface, which is a keyword of the language, is very different from a C language application programming interface, which is a meta-description of a group of header files. Header files don’t exist in Java.

    I elaborate here.

  7. 3

    Worth copying from one of the linked prior discussions:

    22
    Ned Heller
    November 14, 2014 at 7:45 am

    May I p0int out that all software is functional, and the point of protection is to prevent copying for the useful aspects of software.

    We need to put software into a quasi patent mode of protection: require originality, protection only for copying, and a limited term: 10 years.

    There should be no question then that APIs are protectable.

    21.1

    anon
    November 14, 2014 at 7:53 am

    May I point out that what you want to point out here does not square with your positions regarding printed matter?

    May I point out as well that your refusal to even engage my explanation of Set C and Set B printed matter stands in stark contrast to your position here?

    May I also point out that you are still not recogizing that the different IP laws protect different aspects of man’s handiwork, and that a particular handiwork may have more than one aspect and may rightfully be protected by more than one IP law?

    21.2

    anon
    November 14, 2014 at 8:13 am

    Ned let me also remind you that copyright law expressly does not protect what you are labeling as ‘useful aspects.’ That term is the same as ‘utility’ which is protected under a different IP law.

    I do not know where you are deriving this “quasi patent mode” thought from, or why you resist the clear place of patent law to protect what patent law is meant to protect.

    What is the reason why you refuse to engage in a dialogue on these points?

    As I have stated before, your silence screams volumes. Your choice not to address your inconsistencies says far more than you may wish to be said.

  8. 2

    Posture: Appealed from the 9th circuit. See pages 1, 6-7

    …including:
    Oracle now appeals from the district court’s final judgment and its decisions denying Oracle’s motions for JMOL and motion for a new trial. Google cross-appeals from the final judgment purportedly to “preserv[e] its claim that the declarations/SSO are not protected by copyright law,” but advances no argument for why this court can or should revisit our prior decision on copyrightability. Cross-Appellant Br. 83.

  9. 1

    Dennis, please remind us how this *copyright* case found on the docket of the CAFC and not the 9th circuit.

    1. 1.1

      I had to look for this too. Here is what I found:

      (Normally, cases in Northern California are appealed to the U.S. Court of Appeals for the Ninth Circuit, but this case was appealed to the Federal Circuit, in Washington, DC, which some argue has a pro-IP bias. This was because the Federal Circuit has near-exclusive jurisdiction over patent appeals, and Oracle had brought patent claims in its initial complaint.)

      Source: link to project-disco.org

      1. 1.1.1

        Oracle had brought patent claims in its initial complaint

        What happened to those claims?

        1. 1.1.1.1

          The number of claims in the case diminished as the case progressed, but two claims were still asserted at the jury trial. They went to the jury, who gave verdicts that the claims were not infringed.

          Oracle did not appeal those jury verdicts to the Federal Circuit.

          The first Oracle v. Google trial is extensively documented on the old Groklaw site.

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