The decisions in the recent intellectual property lawsuit of Oracle v. Google [i] have drawn the attention of software developers and intellectual property lawyers alike. As we read about the verdict’s potential to shape future copyright case law, our team here at Zeidman Consulting also wondered whether all the facts in the copyright portion of the case had been uncovered. We decided to pursue these questions using the advanced tools for detecting copyright infringement created by our sister company, Software Analysis and Forensic Engineering (SAFE Corporation) and the thorough processes that we have developed. What started off as simple curiosity turned into an interesting research and analysis project to determine if we could uncover evidence of copyright infringement that Oracle’s experts had missed. Our two-week effort turned up some very surprising results–significant amounts of apparently copied code that was not brought up at the trial.

The Oracle v. Google Lawsuit

The lawsuit began with Oracle accusing Google’s mobile operating system, Android, of violating both patents and copyrights that Oracle holds based on its Java programming language. Specifically Oracle initially accused Google of infringing seven of Oracle’s patents [ii] though five were later thrown out [iii], and also accused Google of copying 37 Java language application program interfaces (APIs) [iv] and other Java source code into Android source code. This article focuses on the copyright portion of the case, leaving the patent infringement claims to a future article (if we have the time).

Over recent years, online advertising has been a driving force in the growth of the Internet. As business owners, you never stop hearing about the benefits of having your own website and advertising your services on-line.  I am guilty of preaching this sermon myself!  However, because of the ever-increasing existence of badware, it has become increasingly difficult to know what ads or websites we can trust.  Thankfully, tech giants such as Google, Twitter, Facebook, PayPal and others have joined forces with StopBadware.org and formed the Ads Integrity Alliance (AIA) in order to combat Badware, protect users from bad ads and maintain the integrity of the “online advertising ecosystem.”

StopBadware.org is a non-profit organization that is focused solely on protecting the public from badware websites.  The organization started out as a project of the Berkman Center for Internet & Society at Harvard University but has grown significantly to include partners such as Google, Mozilla, Verizon, PayPal, Qualys, and VeriSign.   The StopBadware Board of Directors consists of many of the biggest names within the Online industry such as Chief Information Security Officer at PayPal, Michael Barrett, (Currently the Chair of the Board), the Vice-President and Chief Internet evangelist for Google, Vinton, G. Cerf, Engineering Director for Google, Mike Shaver, Chairman and CEO of Qualys, Inc., Philippe Courtot to name a few.

United States Federal District Court Judge Denny Chin recently issued a decision denying Google’s motion to dismiss lawsuits by the American Society of Media Photographers and the Authors Guild, and has also certified a class to proceed against Google for what can only really be characterized as massive and intentional copyright infringement.

The major facts in the case are not in dispute.  In 2004, Google announced that it had entered into agreements with several major research libraries to digitally copy books and other writings in their collections. Since then, Google has scanned more than 12 million books. Google has delivered digital copies to the participating libraries, created an electronic database of books, and made text available for online searching.

Google users can search its “digital library” and view excerpts – ”snippets” — from books containing search results. For example, when a user enters a search term on the Google Books website, Google displays a list of books containing that term. In many cases, when the user clicks on the link to a particular book, Google displays up to three “snippets” of text from that book — each about an eighth of a page — each of which contains the search term. Millions of the books scanned by Google were still under copyright, and Google did not obtain copyright permission to scan the books.

Creativity and invention are highly valued within the United States as reflected by patent laws dating back to 1790, with mention of intellectual property even included in the U.S. Constitution. Protecting these ideals was seen as key to promoting an innovative spirit within American society and encouraging the creation of new products. Ultimately, a steady influx of new products and services translates into a healthy economic market as consumers reap the benefits of innovation.

With the advent and rise of the Internet, digital property rights have become an increasingly hot-topic in the Board rooms and Executive Offices of major companies, particularly those in the hi-tech industry. Much like the information protected under intellectual property rights, digital products provide their creators with certain protections under the law. The problems and legal challenges facing major companies like Yahoo and Facebook will help better define the laws surrounding digital property rights, and likely present opportunities as well as a whole host of new legal questions.

In my first article, I posed the question whether the “Smart Phone Patent Wars” were giving IP rights – and more specifically, patents – a bad rap?  My conclusion was an unfortunate “yes,” with the villains being a handful of companies that willingly contributed patented technologies to various standard setting organizations (SSOs), encouraged their use in a host of consumer electronics, and years later charge the very producers they encouraged to implement these standards with patent infringement.  In my second article, I examined the so-called “Fair, Reasonable and Non-Discriminatory” (FRAND) licensing terms that SSOs require of their participants and concluded the phrase has no clear, widely-accepted definition or standards for determining compliance.  In my third article, I examined the patent policies of four major SSOs and concluded that none offered any clear guidance on what constitutes a FRAND license leading to unnecessary and counterproductive litigation.  In this article – the fourth in a six-part series – I now make a few observations among the flurry of activity as to the market effects of these patent wars.

First, I recently read a blog entry by Mark Cuban – published on the Web’s currently top-ranked blog, the Huffington Post – where he states:

I hate patent laws. I think 99 percent of the time they are anti-competitive, corruptive, impede creativity and innovation … I think the ratio of patent law doing a good job protecting company IP vs it being used purely to negatively impact competitors or to troll for un-earned revenue is probably 1000 to 1, or worse.

Commenting on the Yahoo! Inc. patent infringement lawsuit filed against Facebook in March of 2012, Mr. Cuban concludes his post by stating: “I hope Yahoo[!] is awarded $50 billion dollars. It is the only way that consumers will realize what is at stake with patent law as is.  Then maybe we can get it right and further innovation and competition in this country.”  These statements are from a very influential technology entrepreneur, investor and generally-recognized American business guru.  Thus, it would seem that the continuous negative headlines from the smart phone patent wars are definitely giving patents a bad rap!

As you most likely already know, Google has made it a tradition to create fun Google logo’s (or Doodles) to celebrate specific holidays, anniversaries and the lives of famous artists, pioneers and scientists.   You may recall that on Saturday May 22, 2010, in celebration of Pacman’s 30^th Anniversary, Google featured its very first interactive doodle in the form of a Pacman game you could actually play.  You can read more about it in my article Pacman Celebrates its 30^th Anniversary – Google Style.  Yesterday Google featured another interactive doodle that they called the “Goog” this time in celebration of Dr. Robert Moog’s (rhymes with “vogue”) 78th birthday.  Moog was an American pioneer of music who invented the electronic analog Moog Synthesizer.  If you missed it, that’s OK, you can still play the fully interactive “Goog” Doodle through the Google Doodle Library.

Patent lawsuits and quarrels are not new, nor uncommon. It seems as of late that more and more lawsuits have surfaced, especially in big name companies. Is this a trend or are the big household names significantly overlapping in services and customers, leaving patent lawsuits as a last-ditch effort?

An eight-week jury trial began a few weeks ago to decide whether Google infringed an Oracle Java patent for technology incorporated into its Android software. The jury is in the midst of researching the claim and whether or not Google’s actions might be considered “fair use.” Were Java’s  APIs copyrighted? U.S. District Court Judge William Alsup might make that notion – in which case, all APIs will be copyrighted, leaving Google in violation with its Android creation. This isn’t really a case for the jury though, the decision rests on the judge.

Before that, a lawsuit was filed against Apple, RIM and Samsung by a small company over alleged infringements of a touchscreen patent. This stirred up all kinds of investor advice and customer loyalty.

In a rare social media court case, Yahoo recently sued Facebook for 10 patent infringements. Less than two months after Facebook filed to become publicly traded, Yahoo now claims that many of the features that have allowed Facebook to accrue 850 million users, such as the News Feed, infringe on proprietary Yahoo technology. It is unclear how much money Yahoo is seeking in the lawsuit, but one thing is for certain: if this case moves forward it could be one of the biggest spectacles in the history of patent and intellectual property law. Let’s look at the salient features of the case:

The meat of the litigation revolves around patents. For decades patents have been a significant part of intellectual property law, but in recent years they have proven problematic in the development of new software and the technological innovations. Patents will now be at the heart of a cold war between two of the biggest tech companies in the world. Yahoo, which owns about 1,000 patents, is suing Facebook over 10 patent infringements ranging from Internet advertising methods and privacy controls. One of the patents is described as “optimum placement of advertisements on a webpage.” Yahoo had warned Facebook that they would sue if the social network did not agree to license the patents in question, saying that multiple other major companies had complied. Yahoo was true to their word, and called Facebook’s bluff.

UPDATED March 28, 2012 at 12:15 am ET

In my last article, I posed the question whether the “Smart Phone Patent Wars” were giving IP rights – and more specifically, patents – a bad rap?  My conclusion was an unfortunate “yes,” with the villains being a handful of companies that willingly contributed patented technologies to various standard setting organizations (SSOs), encouraged their use in a host of consumer electronics, and years later charge the very producers they encouraged to implement these standards with patent infringement.  Now in this article – the second in a six-part series – I examine the so-called “Fair, Reasonable and Non-Discriminatory” (FRAND) licensing terms that SSOs require of their participants.

First, before discussing the meaning of FRAND licensing terms, we must understand the nature and importance of SSOs.  These national or international organizations are typically private, non-profit organizations whose members include for-profit company participants seeking to establish one or more technical standards that will be incorporated into a product or technical system.  Some of the more widely recognized SSOs include the Institute of Electrical and Electronics Engineers (IEEE), the Joint Electron Device Engineering Council (JEDEC) and the Telecommunications Industry Association (TIA).  The technical standards adopted by these SSOs are voluntary (unless they are enacted into law by, for example, a state legislature), but influential.  Why, however, have technical standards?  Well, would you buy a smart phone if it could not connect to a mobile network so that you can communicate (by voice or text) to your peers, visit all your favorite websites on the Internet or download pictures, videos and the like?  That is, standardization delivers consumer benefits, especially in product markets where the very value of the product is the fact that a great number of other consumers use the same or a compatible product.

I have often stated that the lifeblood of any high-tech enterprise is the intellectual property (IP) rights that it controls or potentially controls.  This is especially true for my small- and medium-sized enterprise (SME) clients with respect to their short-term salability, long-term profitability, and eventual ability to undertake an IPO or sale exit.  It seemed that public sentiment and the popular press were in accord with this view no more so than when President Obama signed the America Invents Act into law on September 16, 2011.  The law, which received bi-partisan support by passing the U.S. House of Representatives 304-117, and the U.S. Senate 89-9, was widely-praised as the first major overhaul to the U.S. patent system in almost 60 years.  The recent (and mostly negative) headlines concerning the “Smart Phone Patent Wars,” however, has made me wonder if IP rights – and more specifically, patents – are once again getting a bad rap?

The smart phone wars began in 2011 as mobile industry giants either gained or lost profits due to the growth of alternative mobile platforms.  As the wars heated up, Google, Inc. acquired Motorola Mobility Holdings, Inc. – and its 17,000 patents – for US$12.5B on August 15, 2011. (After netting out other assets and liabilities, the price per patent was US$510,204.08!)  This led to the increased headlines.  A nice graphical summary of the wars – whose battlegrounds have been the U.S. International Trade Commission (ITC) in Washington, D.C., the European Commission in Belgium and federal trial courts all over the U.S., Europe and Asia – can be found here.

Whenever a newly-minted lobbying group proposes to radically curb a government agency’s enforcement powers, it’s wise to ask, Who will benefit?

Such is the case with the newest lobby in Washington, the self-described “ITC Working Group.” You won’t learn anything about this organization by searching Google — odd, considering that Google is a member — but according to industry sources, its aim is twofold: First, it wants to block the International Trade Commission (ITC) from hearing patent infringement cases brought by “non-practicing entities” — i.e., patent holders like universities, independent inventors, and others who license their patents for manufacturers to commercialize. And second, it wants to weaken the ITC’s power to block the importation of infringing products into the U.S.

Editorial Note: Last week I published an article titled Patent Strategy: Discovering Crucial Patent Examiner Data.  There were numerous, substantive questions posed about the PatentCore software, so I invited co-creator and patent attorney Chris Holt to address those questions in the article that follows.

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We are very pleased with the interest generated in the PatentCore information system.  The feedback has been overwhelmingly positive.  A number of people have had questions about some of the specifics of the system.  The purpose of this article is to address the most common questions possed by IPWatchdog readers in response to a recent article; Patent Strategy: Discovering Crucial Patent Examiner Data, which was published on January 4, 2012.

One of the most persistent questions asks us to address the inspiration for and reasoning behind the system. As patent attorneys ourselves, we have prosecuted patents for many years for a wide variety of clients.  As committed professionals, we are constantly trying to improve our own performance to ensure that we are delivering quality services to our clients.  That was, quite frankly, the inspiration for the system.  As we began to explore the concepts behind PatentCore, we realized that we could bring value not only to our clients but to the patent community as a whole.  The primary goal of PatentCore is to improve the patent process for patent examiners, patent attorneys and, therefore and primarily, for our clients.

There’s only one thing more disheartening to an online retailer than knowing that a lot of customers are going to abandon their shopping carts before completing a purchase. And that’s the discovery that a whopping three out of four of them will actually turn around and leave the website rather than endure the hassle of registering a new account.

A new technology called “social login,” however, can alleviate both problems. Offered by multiple vendors  (including Facebook) or custom built in-house, social login allows website visitors to log in using their Facebook, Twitter, or other social media identity and avoid registration and password hassles entirely.

This is no small matter. A friend of mine was in a Cost Plus World Market retail location recently and spotted a coffee table he liked. A salesman noted that if he signed up for their online World Explorer rewards program, he could get the table for 25 percent off. So he tried signing up via his iPhone while in the store, but found it too frustrating to awkwardly thumb-type all his personal data — let alone create a unique 10 digit reward program ID — on the iPhone’s tiny virtual keyboard. So he left the store without completing the purchase.

Earlier today Intellectual Ventures (IV) sued Motorola Mobility for patent infringement in the United States Federal District Court for the District of Delaware.  At issue are six patents that IV claims relate to Google’s Android operating system — US Patent Nos. 7,810,144, 6,412,953, 7,409,450, 7,120,462, 6,557,054 and, 6,658,464.

This litigation is worth noting for several reasons.  First, this is yet another patent infringement complaint against Google’s Android operating system.  It seems that practically every month there is another lawsuit claiming that Android infringes this or that patent, which has to raise eyebrows with respect to the underlying intellectual property Google owns in its operating system that is intended to compete against Apple.  Second, once upon a time Google funded IV and vouched for the company and its founder, Microsoft alumnus Nathan Myhrvold.  Now IV has turned the tables on Google, is going after Android and in so doing is suing the company that Google is set to acquire for $12.5 billion.

In the weeks since Google acquired Motorola Mobility and its 17,000 patents for $12.5 billion, the media has engaged in an orgy of hand-wringing over a supposedly “broken” patent system that diverts resources away from innovation and towards litigation instead.

Ignore the histrionics. What the Google-Motorola deal actually proves is that innovation — and its embodiment in intellectual property — is more valuable and necessary than ever for market success. What’s more, patents are no longer simply akin to mining claims that give one the exclusive right to pan for gold. In many cases, patents are the gold itself.

But first, let’s debunk some myths about our supposedly-“broken” patent system. The truth is that the number of patent infringement suits each year has held steady for seven years, at just under 3,000. Ninety percent of these suits are abandoned or settled, and of the 300 that remain, two thirds never go to trial but are adjudicated on pre-trial motion.