AAI Asks Federal Circuit to Prevent Copyright Overreaching in Software Markets (Oracle v. Google)

The American Antitrust Institute (AAI) has filed an amicus brief in the Federal Circuit arguing for a robust fair use defense in computer software markets, where it is particularly needed to promote innovation and competition.

A long-running dispute between Oracle and Google regarding Google’s use of copyrighted  “headers” in the source code of its Android Operating system is now before the Federal Circuit for a second time.  In developing Android, Google copied 37 “application programming interfaces,” or API packages, from Java SE, an open source programming language developed for desktop computers by Sun Microsystems, which was acquired by Oracle in 2010.  API packages are shortcuts that allow computer programmers to build basic functions into their programs without having to write new code from scratch.

Nothwithstanding that API packages serve essentially functional purposes, and have utility for the programmers who write in Java, Oracle claimed a copyright in the API packages as a work of artistic expression. It sued Google alleging, among other things, copyright infringement.  After a jury found Oracle’s copyrights were infringed, the district court set aside the verdict upon determining that the API packages were not copyrightable as a matter of law. On appeal, the Federal Circuit reversed and remanded for a determination of Google’s fair use defense.  After a jury found Google’s copying was fair use, Oracle appealed again.

The AAI’s brief emphasizes that copyright protection is not a tool for controlling markets, but rather a tool for promoting the progress of science and useful arts. The fair use defense, which shares the pro-innovation and pro-competition goals of the antitrust laws, is designed to intervene when a copyright holder’s gain from exercising the right to exclude is not justifiable in relation to society’s loss from the preemption of innovative uses of copyrighted products that would benefit competition and consumers.

The brief argues that, under the four statutory fair use factors, the “transformativeness” of the allegedly infringing use, and the market impact of the use, are critical determinants.  And uses that unlock new functionalities, new products, new markets, and previously unavailable consumer benefits are not only transformative, but they are also less likely to injure demand for the copyrighted expression.  To the extent they do decrease demand for the copyrighted work, this kind of injury is not cognizable under the Copyright Act if it is attributable to the innovative rather than usurpative impact of the use.

The brief contends that the calculus for providing copyright protection favors the fair use defense in the context of software “interfaces” like the API packages at issue. Barring public access to the building blocks of ubiquitous software programming languages has enormously high costs for society and correspondingly minimal benefit for the goals of copyright, which seeks to protect expressive rather than functional works. Without a broad fair use defense, a copyright owner can hold up software developers much like the owner of standard essential patents can hold up implementers, thwarting or taxing innovative developments that build upon software elements and misappropriating for itself the investments made by programmers in learning those elements.

Finally, the brief cautions that Oracle’s narrow view of the fair use defense would raise substantial barriers to innovation and competition. Oracle’s argument that the use of software elements is not transformative when the elements themselves serve the same purpose in the new work would mean that software interfaces that become industry standards because of their functional value, not their expressive content, could never be subject to fair use. The brief also notes that Oracle’s arguments are internally inconsistent and that Oracle’s claimed market harm is not cognizable under the Copyright Act where it is harm from a transformative use that is not based on the expressive content of the infringed work.

The brief was written by AAI Vice President & General Counsel Rick Brunell, AAI Associate General Counsel Randy Stutz, and AAI Advisory Board Member Shubha Ghosh, who is the Crandall Melvin Professor of Law and Director of the Technology Commercialization Law Program at Syracuse University College of Law.  Assistance was also provided by AAI Research Fellow Mark Angland.