Posts Tagged: "transformative"

The U.S. Supreme Court today granted cert in Andy Warhol Foundation v. Goldsmith, Lynn, et. al., a case that asks the High Court to review a decision of the U.S. Court of Appeals for the Second Circuit holding  that Andy Warhol’s Prince Series did not constitute fair use of Lynn Goldsmith’s photograph. In its petition for certiorari, filed in December 2021, the Andy Warhol Foundation told the Court that “the Second Circuit’s decision…creates a circuit split and casts a cloud of legal uncertainty over an entire genre of visual art.”

“Fair Use” is a flexible defense to claims of copyright infringement. It is a doctrine that evolves as technology and the way in which people use copyrighted works advance. As an exception to the general law prohibiting copying others’ works, it permits copying for a limited and “transformative” purpose, such as commentary, criticism, teaching, news reporting, scholarship, or research. Naturally, the way courts analyze the “fair use” defense must adapt as technology advances and the way in which creative content is developed evolves. Earlier this year, for example, the U.S. Supreme Court ruled on a landmark fair use case involving the “copying” of an Application Programming Interface (API).

Since the 2014 Supreme Court decision in Alice v. CLS Bank International, patent claims including software have faced a much higher barrier for receiving patents than any other field of invention. This has also infected specialized software, such as artificial intelligence (AI), which is both distressing and sad. It also explains why Chinese AI start-ups are receiving more funding than U.S. AI start-ups, a fact that should be sending a shockwave through Capitol Hill. Since Alice, patent examiners have presumptively classified software claims that can be implemented on a general computer as covering nothing more than an abstract idea, which means they are ineligible subject matter under 35 U.S.C. § 101. To overcome this rejection, applicants must show why their claimed invention is something more than just a mere abstract idea.  Ironically, what constitutes something more is itself an abstract idea, and even what is an abstract idea is itself an abstract idea. In something straight from out of the Monty Python version of patent eligibility, these key terms – something more and abstract idea – have not been defined by the Supreme Court or the Federal Circuit. As a result, most applications with software are routinely denied, which is understandable when frontline decision makers (i.e., patent examiners) are left without objective guidance. Subjectivity prevails.

On December 3rd, the U.S. Supreme Court denied a petition for writ of certiorari in TVEyes, Inc. v. Fox News Network, LLC, declining the opportunity to decide what would have been the Court’s first case on fair use in a copyright context in 20 years. Denying the petition, the Supreme Court declined to answer whether a transformative use of a copyrighted work causes a cognizable market harm under 17 U.S.C. § 107(4) if it is used in connection with a commercially successful business that the author is unlikely to enter or authorize.

The Federal Circuit recently decided the case of Oracle America v. Google Inc. To “attract Java developers to build apps for Android,” Google copied the declaring code, but wrote its own implementing code for the 37 Java API packages. Id at 1187.  Previously, the Federal Circuit held that “[the] declaring code and the structure, sequence, and organization (‘SSO’) of the Java API packages are entitled to copyright protection.” .  On the other hand, the Federal Circuit also recognized that a reasonable jury could find that “the functional aspects of the packages” are “relevant to Google’s fair use defense.” In this key decision that has the potential to rock the software industry, the Court of Appeals for the Federal Circuit rejected the jury verdict and found that “Google’s use of the 37 Java API packages was not fair as a matter of law.

The Federal Circuit found Google’s use of Java API packages in it’s Android operating system was not a fair use as a matter of law, resurrecting a multi-billion dollar copyright case brought by Oracle Corp against Google. With copyrightability and fair use now decided, unless the Supreme Court intervenes (which seems unlikely) this case will head back to the district court for a damages trial with the sole question being how much money Google owes Oracle America. “This is a hugely important development in the law of copyright and fair use. If it stands, there are numerous implications,” said J. Michael Keyes is a partner at the international law firm Dorsey & Whitney.