by Dennis Crouch
In Google LLC v. Oracle Am., Inc., 593 U. S. ____ (2021), the Supreme Court spends a few pages walking through procedural aspects of the fair use defense.
Like many patent law doctrines, fair use is a mixed question of law and fact. The defendant’s use of the asserted copyrighted work and its impact on the plaintiff are typically factual issues that must be proven by evidence as weighed by the factfinder (often a jury). These are questions such as “how much of the copyrighted work was copied” and “whether there was harm to the actual or potential markets for the copyrighted work.” Google at 19. However, the questions of law emerge when we are categorizing the importance of the factual findings as well as asking the ultimate question of whether the use was a fair use.
The fact-law divide comes up in various ways: Is there a Constitutional right to a jury trial on the issue; lacking that may a jury still decide the issue; does proof require evidence (as defined by the Federal Rules of Evidence) proven to a particular standard; or instead do we simply look for the ‘right’ answer; on appeal, what is the standard of review — deference or not? Fact/Law also comes up in patent prosecution, but examiners are not charged with making the distinction and the rules of evidence don’t apply.
At the trial court this leads to the very practical question of how easily a judge can dispose of the issue pre-trial. Questions of law are often easy to determine pre-trial; some mixed questions are also relatively easy to determine pre-trial if there is no right to a jury determination; mixed questions involving substantial factual disputes and a right to a jury trial are hard. In patent cases, courts are regularly making pre-trial determinations on claim construction and eligibility, both of which are ultimately questions of law but that can involve underlying factual determinations. Obviousness is another mixed question. Although the ultimate determination of obviousness is a question of law, it is treated differently from claim construction and eligibility. Rather than being decided by a judge, obviousness is typically decided by a jury as fact-finder. The difference is that obviousness typically requires detailed factual determinations that are hard to separate from the ultimate conclusion of obviousness and that are subject to a Constitutional right to a jury trial.
In deciding an issue, a district court will typically separate its analysis between findings-of-fact and conclusions-of-law. This separation is expressly required in FRCP 52(a)(1) when a judge determines the facts without a jury. District courts also decide other substantive questions pre- and post-trial. However, those determinations are typically purely questions-of-law. (Failure to state a claim; Summary Judgment; Judgment as a Matter of Law).
Back to Google: Oracle sued Google for copyright infringement, and Google raised a defense of Fair Use. The district court gave the question of fair use to the jury who sided with Google. On appeal, though the Federal Circuit reversed and found no fair use. Although the jury had decided the issue, the Federal Circuit gave no deference to the jury’s legal conclusions. In its subsequent analysis, the Supreme Court agreed with the Federal Circuit’s procedural approach of de novo review of the legal conclusions but ultimately disagreed on the substance. Rather, the Supreme Court concluded that Google’s use was a fair use as a matter of law.
One typical difficulty in the law-fact divide is that the questions are often not easily separable. In Markman, the Supreme Court called claim construction a “mongrel practice” because it is a mixed question that is hard to separate-out. Markman v. Westview Instruments, Inc., 517 U.S. 370 (1996). In Google, the court determined that the big questions of fair use should be treated as questions-of-law because they “primarily involves legal work.”
The Google court went on to cite Markman in concluding that there is no 7th Amendment Right to a Jury Trial on the doctrine of fair use. “As far as contemporary fair use is concerned, we have described the doctrine as an ‘equitable,’ not a ‘legal,’ doctrine.” Google at 20. See U.S. Const. 7th Amd. (“In Suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved.”).
The Court’s general approach to mixed questions of law is explained in some detail within its 2018 bankruptcy decision of U. S. Bank N. A. v. Village at Lakeridge, LLC, 583 U. S. ___, 138 S. Ct. 960 (2018). In that case, the mixed-question was whether a creditor qualified as a “non-statutory insider.” In U.S. Bank, the court explained that “mixed questions are not all alike.” Some mixed questions are more like questions of law requiring an “amplifying or elaborating on a broad legal standard.” Those should be treated as questions of law. Other mixed questions require analysis of narrow facts “that utterly resist generalization.” Those should be treated as questions of fact. “In short, the standard of review for a mixed question all depends—on whether answering it entails primarily legal or factual work.”
For the fair use analysis in Google, the court followed the U.S. Bank standard and determined that the fair use questions at issue in the case were primarily legal and thus should be reviewed de novo on appeal.
Bringing all this back to patent law, I don’t see anything in this analysis to disturb our current approaches to obviousness, claim construction and eligibility. But, both Google and U.S. Bank are clear that they are focusing on the particular issues in the case at hand. It may well be that the mixed question analysis will come out differently on a different set of facts.