I don’t find myself writing about how some combination of the USPTO and the court system gets things right on trademark matters very often, but I certainly did a couple of years ago in a series of posts about a fashion brand owned by Erik Brunetti. The brand was initially denied a trademark for its name, which is FUCT, over vulgarity concerns. That decision was overturned on appeal, with the courts rightly recognizing that the First Amendment trumps the puritanical sensibilities of the USPTO. It was a really good ruling overall.
Well, Brunetti wasn’t done. Given his victory in trademarking the term “FUCT,” he then attempted to get a trademark in a series of fashion categories for the work “FUCK.” After all, the courts had made it clear that civility and morality checks need not apply. However, the USPTO this time got it right and denied the trademark application as being too generic to serve as a source identifier. The USPTO’s decision included such delightfully vulgar analysis as:
The record before us establishes that the word FUCK expresses well-recognized familiar sentiments and the relevant consumers are accustomed to seeing it in widespread use, by many different sources, on the kind of goods identified in the FUCK Applications. Consequently, we find that it does not create the commercial impression of a source indicator, and does not function as a trademark to distinguish Applicant’s goods and services in commerce and indicate their source.
I completely fucking agree, USPTO people. Good for you, this was another good decision.
Unfortunately, Brunetti appealed the decision, as he had with “FUCT”, and the appeals court has decided that the USPTO had failed to provide a clear reason for its denial.
Aug 26 (Reuters) – A U.S. appeals court on Tuesday ordered the U.S. Patent and Trademark Office, opens new tab to reconsider its decision to deny an application for a trademark covering the obscenity word “fuck.” In a split 2-1 decision, the U.S. Court of Appeals for the Federal Circuit said the USPTO failed to provide clear reasoning for denying the application by streetwear designer Erik Brunetti.
The Federal Circuit said the dispute differed from Brunetti’s Supreme Court case because the USPTO’s decision was not based on the fact that the mark was obscene. But the court agreed with Brunetti that the USPTO had registered other all-purpose words as trademarks, such as “Love,” and said the agency “failed to provide sufficient precision in its rationale for why some commonplace words can serve as a mark, but others, such as FUCK, cannot.”
And, to be fair, Brunetti has something of a point here. The USPTO is not exactly a beacon of consistency when it comes to what it allows to be a registered trademark and what it does not. That’s a huge part of the problem.
But my answer to Brunetti would simply be that all he’s done is point out that there are other simple, commonplace words that should probably have their registrations rescinded. This isn’t an argument that “FUCK” should be a trademark, in other words. It’s an argument that the USPTO often times sucks at their jobs.
Because the real rebuttal from the USPTO ought need only be a showing of all the other registered trademarks that incorporate the word “fuck” into something more identifying or unique, never mind all of the other examples of clothing and fashion brands out there that use the word in one way or another. It’s ubiquitous and I’m more than a bit surprised that the appeals court needs the USPTO to be more detailed in its denial. After all, it was right to say that the word doesn’t serve as an identifier as a source of a good, because it’s used far to widely to do so.
So here’s to hoping that the USPTO cares enough to stand its ground.
Remember “Liberation Day”? The day when Trump launched those apparently freedom-loving taxes on all Americans by declaring war on global commerce so hard that we were even planning on taxing penguins on uninhabited islands? Well, some of you might recall that the Constitution distributes power, and doesn’t give it all to the President. And Trump’s tariffs are supposedly based on “emergency” powers. The president can impose certain regulations on foreign countries during emergencies, Congress said — you know, like if Canada nukes us or something. Trump looked at this law and thought: “Perfect! Americans buying stuff from other countries is clearly an emergency.”
His theory (to the extent it can be called a “theory”) goes something like this: trade deficits are an “unusual and extraordinary threat” to America, so the president can declare a perpetual national emergency about… international commerce existing. Every purchase of a Toyota is basically another Pearl Harbor.
Anyway, two courts looked at this theory this week and had some thoughts.
First up: the US Court of International Trade, which is exactly what it sounds like — the court that deals with trade stuff. They took one look at Trump’s tariffs and said, essentially, “The Constitution gives Congress the power to impose tariffs, not the president. This isn’t complicated.”
Now, Congress did pass a law saying the president can “regulate a variety of economic transactions” during emergencies. But here’s the thing: The court noted that declaring every trading relationship with every country to be an emergency is… not really how emergencies work.
The court’s reasoning was pretty straightforward:
IEEPA does not authorize any of the Worldwide, Retaliatory, or Trafficking Tariff Orders. The Worldwide and Retaliatory Tariff Orders exceed any authority granted to the President by IEEPA to regulate importation by means of tariffs.The Trafficking Tariffs fail because they do not deal with the threats set forth in those orders.
Translation: You can’t just declare everything an emergency and use emergency powers forever.
But wait! There’s more. Yesterday, a regular federal court in DC also blocked the tariffs. Judge Rudolph Contreras was equally unimpressed with Trump’s legal theory:
This case is not about tariffs qua tariffs. It is about whether IEEPA enables the President to unilaterally impose, revoke, pause, reinstate, and adjust tariffs to reorder the global economy. The Court agrees with Plaintiffs that it does not
The judge made some pretty devastating points about why Trump’s theory falls apart. First, there’s the basic constitutional problem:
The Court agrees with Plaintiffs that the power to regulate is not the power to tax… The Constitution recognizes and perpetuates this distinction. Clause 1 of Article I, Section 8provides Congresswith the “Power To lay and collect Taxes, Duties, Imposts and Excises.” Clause 3 of Article I, Section 8 empowers Congress “To regulate Commerce with foreign Nations.”
In other words, the Constitution specifically separates the power to tax from the power to regulate trade and gives both to Congress. If Trump could just call tariffs “regulation,” then that whole separation becomes meaningless.
Congress has also been careful when delegating tariff authority to presidents. Every other law giving the president tariff powers comes with “express procedural, substantive, and temporal limits.” But Trump’s reading of the emergency law would “eviscerate” all those careful limits:
Those comprehensive statutory limitations would be eviscerated if the President could invoke a virtually unrestricted tariffing power under IEEPA…. The Court will not assume that, in enacting IEEPA, Congress repealed by implication every extant limitation on the President’s tariffing authority….
Even worse, if the court were willing to accept Trump’s interpretation of the IEEPA, then that would make the IEEPA unconstitutional. Oops!
Defendants’ interpretation could render IEEPA unconstitutional. IEEPA provides that the President may “regulate . . . importation or exportation.” … The Constitution prohibits export taxes. See U.S. Const. art. I, § 9, cl. 5 (“No Tax or Duty shall be laid on Articles exported from any State.”). If the term “regulate” were construed to encompass the power to impose tariffs, it would necessarily empower the President to tariff exports, too. The Court cannot interpret a statute as unconstitutional when any other reasonable construction is available.
Finally, the court notes that in the fifty years since this emergency law was passed, literally no president has ever used it to impose tariffs. That’s… probably relevant.
And, of course, the markets loved this news. Global stock futures jumped when the courts blocked the tariffs, which tells you everything you need to know about how seriously financial markets take Trump’s trade policies.
The White House press secretary, Karoline Leavitt, responded by claiming that courts have no authority to review presidential tariffs at all, which is… an interesting constitutional theory. If you squint, it almost sounds like she’s arguing that federal judges have absolutely no role overseeing executive uses of power, which might come as news to the Supreme Court. Or anyone who is familiar with how the three branches of government work.
Leavitt: The courts should have no role here. There is a troubling & dangerous trend of unelected judges inserting themselves into the presidential decision making process. America cannot function if President Trump has his sensitive diplomatic or trade negotiations railroaded by activist judges.
Leavitt spews this constitutional nonsense with such conviction that you’d almost think she believes it. But despite her protests about “unelected… activist judges” (some of whom were appointed by Trump himself), it remains a simple fact: Donald Trump is no king, and multiple courts keep ruling to that effect.
Meanwhile, late Thursday, Trump himself blew up at the CIT judges and used it to take a surprising swipe at the Federalist Society and Leonard Leo:
If you can’t see that screenshot, here is the jumbo-sized word salad for you:
The U.S. Court of International Trade incredibly ruled against the United States of America on desperately needed Tariffs but, fortunately, the full 11 Judge Panel on the U.S. Court of Appeals for the Federal Circuit Court has just stayed the order by the Manhattan-based Court of International Trade. Where do these initial three Judges come from? How is it possible for them to have potentially done such damage to the United States of America? Is it purely a hatred of “TRUMP?” What other reason could it be?
I was new to Washington, and it was suggested that I use The Federalist Society as a recommending source on Judges. I did so, openly and freely, but then realized that they were under the thumb of a real “sleazebag” named Leonard Leo, a bad person who, in his own way, probably hates America, and obviously has his own separate ambitions. He openly brags how he controls Judges, and even Justices of the United States Supreme Court — I hope that is not so, and don’t believe it is! In any event, Leo left The Federalist Society to do his own “thing.” I am so disappointed in The Federalist Society because of the bad advice they gave me on numerous Judicial Nominations. This is something that cannot be forgotten!
With all of that being said, I am very proud of many of our picks, but very disappointed in others. They always must do what’s right for the Country! In this case, it is only because of my successful use of Tariffs that many Trillions of Dollars have already begun pouring into the U.S.A. from other Countries, money that, without these Tariffs, we would not be able to get. It is the difference between having a rich, prosperous, and successful United States of America, and quite the opposite.
The ruling by the U.S. Court of International Trade is so wrong, and so political! Hopefully, the Supreme Court will reverse this horrible, Country threatening decision, QUICKLY and DECISIVELY. Backroom “hustlers” must not be allowed to destroy our Nation!
The horrific decision stated that I would have to get the approval of Congress for these Tariffs. In other words, hundreds of politicians would sit around D.C. for weeks, and even months, trying to come to a conclusion as to what to charge other Countries that are treating us unfairly. If allowed to stand, this would completely destroy Presidential Power — The Presidency would never be the same!
This decision is being hailed all over the World by every Country, other than the United States of America. Radical Left Judges, together with some very bad people, are destroying America. Under this decision, Trillions of Dollars would be lost by our Country, money that will, MAKE AMERICA GREAT AGAIN. It would be the harshest financial ruling ever leveled on us as a Sovereign Nation. The President of the United States must be allowed to protect America against those that are doing it Economic and Financial harm. Thank you for your attention to this matter!
Since I don’t hate you quite as much as Trump does, I broke up his nonsensical spew into paragraphs to make it marginally more readable.
But there are a few notable points in here: first, Trump believes that any judge that rules against him is somehow bad and hates America. And if they were appointed by him, he’ll now blame Leonard Leo and the Federalist Society. That’s pretty incredible, since the rise of Trump was very, very much enabled by Leo and the Federalist Society, and their efforts to pack the courts with partisan ideological lackeys who would push Christian nationalism and GOP politics forward.
It’s no surprise but is yet another data point confirming Trump’s view that anyone telling him he broke the law must be anti-American. It’s a dangerous authoritarian stance, but not a new one.
Second, Trump, who positions himself as the world’s greatest dealmaker, effectively admits that he can’t get a Republican Congress to actually approve these tariffs.
Third, Trump is the fucking President. Pretending he’s some poor little victim of the Federalist Society ramming through judges he doesn’t like is so stupid. Trump is basically admitting he was played like a fiddle by Leo, which just demonstrates how weak and unqualified he is as President.
Unfortunately, as Trump noted, the Court of Appeals for the Federal Circuit already put the first ruling on hold while they figure out how to handle it and related cases. But, honestly? The legal reasoning in both rulings is quite solid. Trump’s emergency powers don’t extend to “I don’t like trade deficits” any more than they extend to “I don’t like Mondays.” He may never realize that, but the rest of us must retain that basic reality.
This seems likely to reach the Supreme Court fairly quickly, at which point it’s anyone’s guess how those “unelected activist judges” will rule. But for now, we have two federal courts saying the same thing: the Constitution still applies, even to Trump’s economic theories. It may make Trump sad, but it certainly doesn’t make him right.
In 2022, three companies with strange names and no clear business purpose beyond patent litigation filed dozens of lawsuits in Delaware federal court, accusing businesses of all sizes of patent infringement. Some of these complaints claimed patent rights over basic aspects of modern life; one, for example, involved a patent that pertains to the process of clocking in to work through an app.
These companies – named Mellaconic IP, Backertop Licensing, and Nimitz Technologies – seemed to be typical examples of “patent trolls,” companies whose primary business is suing others over patents or demanding licensing fees rather than providing actual products or services.
However, the cases soon took an unusual turn. The Delaware federal judge overseeing the cases, U.S. District Judge Colm Connolly, sought more information about the patents and their ownership. One of the alleged owners was a food-truck operator who had been promised “passive income,” but was entitled to only a small portion of any revenue generated from the lawsuits. Another owner was the spouse of an attorney at IP Edge, the patent-assertion company linked to all three LLCs.
Following an extensive investigation, the judge determined that attorneys associated with these shell companies had violated legal ethics rules. He pointed out that the attorneys may have misled Hau Bui, the food-truck owner, about his potential liability in the case. Judge Connolly wrote:
[T]he disparity in legal sophistication between Mr. Bui and the IP Edge and Mavexar actors who dealt with him underscore that counsel’s failures to comply with the Model Rules of Professional Conduct while representing Mr. Bui and his LLC in the Mellaconic cases are not merely technical or academic.
Judge Connolly also concluded that IP Edge, the patent-assertion company behind hundreds of patent lawsuits and linked to the three LLCs, was the “de facto owner” of the patents asserted in his court, but that it attempted to hide its involvement. He wrote, “IP Edge, however, has gone to great lengths to hide the ‘we’ from the world,” with “we” referring to IP Edge. Connolly further noted, “IP Edge arranged for the patents to be assigned to LLCs it formed under the names of relatively unsophisticated individuals recruited by [IP Edge office manager] Linh Deitz.”
Patent Trolls Tried To Shut Down This Investigation
The attorneys involved in this wild patent trolling scheme challenged Judge Connolly’s authority to proceed with his investigation. However, because transparency in federal courts is essential and applicable to all parties, including patent assertion entities, EFF and two other patent reform groups filed a brief in support of the judge’s investigation. The brief argued that “[t]he public has a right—and need—to know who is controlling and benefiting from litigation in publicly-funded courts.” Companies targeted by the patent trolls, as well as the Chamber of Commerce, filed their own briefs supporting the investigation.
The appeals court sided with us, upholding Judge Connolly’s authority to proceed, which led to the referral of the involved attorneys to the disciplinary counsel of their respective bar associations.
After this damning ruling, one of the patent troll companies and its alleged owner made a final effort at appealing this outcome. In July of this year, the U.S. Court of Appeals for the Federal Circuit ruled that investigating Backertop Licensing LLC and ordering its alleged owner to testify was “an appropriate means to investigate potential misconduct involving Backertop.”
In EFF’s view, these types of investigations into the murky world of patent trolling are not only appropriate but should happen more often. Now that the appeals court has ruled, let’s take a look at what we learned about the patent trolls in this case.
Patent Troll Entities Linked To French Government
One of the patent trolling entities, Nimitz Technologies LLC, asserted a single patent, U.S. Patent No. 7,848,328, against 11 companies. When the judge required Nimitz’s supposed owner, a man named Mark Hall, to testify in court, Hall could not describe anything about the patent or explain how Nimitz acquired it. He didn’t even know the name of the patent (“Broadcast Content Encapsulation”). When asked what technology was covered by the patent, he said, “I haven’t reviewed it enough to know,” and when asked how he paid for the patent, Hall replied, “no money exchanged hands.”
The exchange between Hall and Judge Connolly went as follows:
Q. So how do you come to own something if you never paid for it with money?
A. I wouldn’t be able to explain it very well. That would be a better question for Mavexar.
Q. Well, you’re the owner?
A. Correct.
Q. How do you know you’re the owner if you didn’t pay anything for the patent?
A. Because I have the paperwork that says I’m the owner.
The Nimitz patent originated from the Finnish cell phone company Nokia, which later assigned it and several other patents to France Brevets, a French sovereign investment fund, in 2013. France Brevets, in turn, assigned the patent to a US company called Burley Licensing LLC, an entity linked to IP Edge, in 2021. Hau Bui (the food truck owner) signed on behalf of Burley, and Didier Patry, then the CEO of France Brevets, signed on behalf of the French fund.
France Brevets was an investment fund formed in 2009 with €100 million in seed money from the French government to manage intellectual property. France Brevets was set to receive 35% of any revenue related to “monetizing and enforcement” of the patent, with Burley agreeing to file at least one patent infringement lawsuit within a year, and collect a “total minimum Gross Revenue of US $100,000” within 24 months, or the patent rights would be given back to France Brevets.
Burley Licensing LLC, run by IP Edge personnel, then created Nimitz Technologies LLC— a company with no assets except for the single patent. They obtained a mailing address for it from a Staples in Frisco, Texas, and assigned the patent to the LLC in August 2021, while the obligations to France Brevets remained unchanged until the fund shut down in 2022.
The Bigger Picture
It’s troubling that patent lawsuits are often funded by entities with no genuine interest in innovation, such as private equity firms. However, it’s even more concerning when foreign government-backed organizations like France Brevets manipulate the US patent system for profit. In this case, a Finnish company sold its patents to a French government fund, which used US-based IP lawyers to file baseless lawsuits against American companies, including well-known establishments like Reddit and Bloomberg, as well as smaller ones like Tastemade and Skillshare.
Judges should enforce rules requiring transparency about third-party funding in patent lawsuits. When ownership is unclear, it’s appropriate to insist that the real owners show up and testify—before dragging dozens of companies into court over dubious software patents.
Stephen Thaler is a man on a mission. It’s not a very good mission, but it’s a mission. He created something called DABUS (Device for the Autonomous Bootstrapping of Unified Sentience) and claims that it’s creating things, for which he has tried to file for patents and copyrights around the globe, with his mission being to have DABUS named as the inventor or author. This is dumb for many reasons. The purpose of copyright and patents are to incentivize the creation of these things, by providing to the inventor or author a limited time monopoly, allowing them to, in theory, use that monopoly to make some money, thereby making the entire inventing/authoring process worthwhile. An AI doesn’t need such an incentive. And this is why patents and copyright only are given to persons and not animals or AI.
But Thaler has spent years trying to get patent offices around the world to give DABUS a patent. I’ll just note here that if Thaler is correct, then it seems to me that he shouldn’t be able to do this at all, as it’s not his invention to patent. It’s DABUS’s. And unless DABUS has hired Thaler to seek a patent, it’s a little unclear to me why Thaler has any say here.
Either way, Thaler’s somewhat quixotic quest continues to fail. The EU Patent Office rejected his application. The Australian patent office similarly rejected his request. In that case, a court sided with Thaler after he sued the Australian patent office, and said that his AI could be named as an inventor, but thankfully an appeals court set aside that ruling a few months ago. In the US, Thaler/DABUS keeps on losing as well. Last fall, he lost in court as he tried to overturn the USPTO ruling, and then earlier this year, the US Copyright Office also rejected his copyright attempt (something it has done a few times before). In June, he sued the Copyright Office over this, which seems like a long shot.
And now, he’s also lost his appeal of the ruling in the patent case. CAFC, the Court of Appeals for the Federal Circuit — the appeals court that handles all patent appeals — has rejected Thaler’s request just like basically every other patent and copyright office, and nearly all courts.
The ruling is pretty straightforward:
This case presents the question of who, or what, can be
an inventor. Specifically, we are asked to decide if an artificial intelligence (AI) software system can be listed as the
inventor on a patent application. At first, it might seem
that resolving this issue would involve an abstract inquiry
into the nature of invention or the rights, if any, of AI systems. In fact, however, we do not need to ponder these metaphysical matters. Instead, our task begins – and ends –
with consideration of the applicable definition in the relevant statute.
The United States Patent and Trademark Office (PTO)
undertook the same analysis and concluded that the Patent
Act defines “inventor” as limited to natural persons; that
is, human beings. Accordingly, the PTO denied Stephen
Thaler’s patent applications, which failed to list any human as an inventor. Thaler challenged that conclusion in
the U.S. District Court for the Eastern District of Virginia,
which agreed with the PTO and granted it summary judgment. We, too, conclude that the Patent Act requires an
“inventor” to be a natural person and, therefore, affirm.
The CAFC ruling doesn’t get that deep into the issues — it just looks at the US Patent Act and says “um, duh, seems kinda obvious that this only covers human beings.”
The Patent Act does not define “individual.” However,
as the Supreme Court has explained, when used “[a]s a
noun, ‘individual’ ordinarily means a human being, a person.” Mohamad v. Palestinian Auth., 566 U.S. 449, 454
(2012) (internal alteration and quotation marks omitted).
This is in accord with “how we use the word in everyday
parlance”: “We say ‘the individual went to the store,’ ‘the
individual left the room,’ and ‘the individual took the car,’
each time referring unmistakably to a natural person.” Id.
Dictionaries confirm that this is the common understanding of the word. See, e.g., Individual, Oxford English Dictionary (2022) (giving first definition of “individual” as “[a]
single human being”); Individual, Dictionary.com (last visited July 11, 2022), https://www.dictionary.com/browse/individual (giving “a single human being, as distinguished
from a group” as first definition for “individual”). So, too,
does the Dictionary Act, which provides that legislative use
of the words “person” and “whoever” broadly include (“unless the context indicates otherwise”) “corporations, companies, associations, firms, partnerships, societies, and joint
stock companies, as well as individuals.” 1 U.S.C. § 1 (emphasis added). “With the phrase ‘as well as,’ the definition
marks ‘individual’ as distinct from the list of artificial entities that precedes it,” showing that Congress understands “individual” to indicate natural persons unless otherwise
noted. Mohamad, 566 U.S. at 454.
Consequently, the Supreme Court has held that, when
used in statutes, the word “individual” refers to human beings unless there is “some indication Congress intended” a
different reading. Id. at 455 (emphasis omitted).4 Nothing
in the Patent Act indicates Congress intended to deviate
from the default meaning. To the contrary, the rest of the
Patent Act supports the conclusion that “individual” in the
Act refers to human beings.
For instance, the Act uses personal pronouns – “himself” and “herself” – to refer to an “individual.” § 115(b)(2).
It does not also use “itself,” which it would have done if
Congress intended to permit non-human inventors. The
Patent Act also requires inventors (unless deceased, incapacitated, or unavailable) to submit an oath or declaration.
See, e.g., id. (requiring oath or declaration from inventor
that “such individual believes himself or herself to be the
original inventor or an original joint inventor of a claimed
invention in the application”). While we do not decide
whether an AI system can form beliefs, nothing in our record shows that one can, as reflected in the fact that Thaler
submitted the requisite statements himself, purportedly on
DABUS’ behalf.
The panel easily rejects Thaler’s arguments that try to get around this, which aren’t even worth bothering with here (they were pedantic and nitpicky, and the CAFC panel rightly treats them as nonsense). Then the panel notes that, look, there’s really no debate here, and this whole campaign by Thaler is obviously silly:
Statutes are often open to multiple reasonable readings. Not so here. This is a case in which the question of
statutory interpretation begins and ends with the plain
meaning of the text. See Bostock v. Clayton Cnty., 140 S.
Ct. 1731, 1749 (2020) (“This Court has explained many
times over many years, when the meaning of the statute’s
terms is plain, our job is at an end.”). In the Patent Act,
“individuals” – and, thus, “inventors” – are unambiguously
natural persons.
Given Thaler’s willingness to file suits and appeals all over the globe, I imagine he’ll now petition the Supreme Court as well, though it seems unlikely the court will be interested — but these days, you never really know.
At this point, i believe the only country that has actually taken Thaler seriously (other than that one brief blip in Australia) is South Africa. Amusingly, Thaler tried to use South Africa’s approval as part of his argument here in the US, and that was laughed off pretty easily.
Thaler also notes that South Africa has granted patents with DABUS as an inventor. This foreign patent office was not interpreting our Patent Act. Its determination
does not alter our conclusion.
Thaler’s weird campaign is a distraction. It’s good to see courts and patent agencies around the globe (mostly) shutting it down. Opening up patents and copyrights to AI would be a disaster and would create lots of serious problems for actual innovation and creativity. Unless Thaler is doing this deliberately to lose and set good precedent, he’s a gadfly, wasting the time of lots of people over a very silly quest.
You may recall last fall we had an absolutely astounding story about Judge Alan Albright, a former patent litigator, who was appointed as the only judge in the federal district court in Waco. He very, very quickly made it clear that he wanted all patent cases to come to him, turning the Western District of Texas into the new favored home of patent trolls, taking the mantle from East Texas, which has famously been the trolls’ preferred home for over a decade. Albright did things most people inherently recognize no judge should ever do. This includes things like literally going on a publicity tour to convince patent holders and trolls to file patent cases in his court. To this day, he seems to relish the fact that, despite being on the bench for just a little over two years, more than 20% of all patent cases end up on his personal docket.
With his desire to be the judge of choice for patent holders, he also built up a reputation for refusing to transfer cases to more appropriate jurisdictions — even though the Supreme Court made clear in 2017 that patent cases should go to the appropriate docket, rather than whatever one the patent holder wants. A paper published last fall all about Albright’s troubling role in patent cases called this out specifically.
Since taking the bench, Judge Albright has likewise staunchly refused to transfer cases out of the Western District. As of July 7, 2020, he has decided thirteen motions seeking transfer away from the Western District under ? 1404(a); he has denied eleven. In fact, in a recent order, Judge Albright effectively told Apple?which has been sued at least ten times in cases assigned to Judge Albright and regularly seeks to have those cases moved to the Northern District of California?to stop filing transfer motions.
At the time we wrote that story last fall, the Court of Appeals for the Federal Circuit (CAFC), which handles all patent appeals, had just told Albright to transfer at least one of those cases. In February it got angry at Albright again in a case involving SK Hynix. Incredibly, even though SK Hynix sought to transfer the case all the way back in early May of last year, Judge Albright not only refused to rule on the motion to transfer, but ordered SK Hynix to go through the expensive discovery process — which is what tends to destroy defendants in patent suits and push them to settle. After months of the judge refusing to even respond to the motion to transfer and having to go through expensive discovery, SK Hynix asked the CAFC to weigh in, and they slammed Albright, reminding him that they’d already scolded him about this last year:
We agree with SK hynix that the district court?s handling of the transfer motion up until this point in the case has amounted to egregious delay and blatant disregard for precedent. As we recently reiterated, ?[a]lthough district courts have discretion as to how to handle their dockets, once a party files a transfer motion, disposing of that motion should unquestionably take top priority.? In re Apple Inc., 979 F.3d 1332, 1337 (Fed. Cir. 2020) (citations omitted); see also In re Horseshoe Entm?t, 337 F.3d 429, 433 (5th Cir. 2003) (?[I]n our view disposition of that [transfer] motion should have taken a top priority in the handling of this case by the . . . District Court.?). No such priority was given to the motion here, as it simply lingered unnecessarily on the docket while the district court required the parties to proceed ahead with the merits.
Unfortunately, rather than force Albright to transfer the case, they noted that he’d finally agreed to have a hearing on the motion to transfer, so they’d basically let it slide. The very next day, Albright ruled on the motion… and denied the transfer, saying the trial would move forward. A few days ago, SK Hynix agreed to a settlement to end the case.
Last month, CAFC had to step in again on an Albright case where he seemed to have done exactly the same thing. This case involved TracFone. In June, it had filed a motion asking Albright to either (1) dismiss the case for being in an improper venue, or (2) transfer it to a more appropriate venue. Albright did neither. Instead he pushed TracFone into discovery while simply not ruling on the motion. Notice a pattern? So did the CAFC:
We addressed strikingly similar circumstances from the same district court last month in SK hynix. There, as here, the petitioners sought mandamus relief from this court after waiting nearly eight months for a ruling on a motion to transfer that was fully briefed. We agreed with the petitioner that ?the district court?s handling of the transfer motion up until this point in the case has amounted to egregious delay and blatant disregard for precedent.? 835 F. App?x at 600?01. We did not compel further action because the district court scheduled a hearing while the petition was pending before this court, but we directed the district court to stay proceedings, including the upcoming Markman hearing, until the district court ruled on the motion. We explained that mandamus was appropriate because ?precedent compels entitlement to such relief and the district court?s continued refusal to give priority to deciding the transfer issues demonstrates that SK hynix has no alternative means by which to obtain it.?
It then points out what a travesty this is:
In Google, we explained that lengthy delays in resolving transfer motions can frustrate the intent of ? 1404(a) by forcing defendants ?to expend resources litigating substantive matters in an inconvenient venue while a motion to transfer lingers unnecessarily on the docket.? 2015 WL 5294800 at *1. We concluded that a trial court?s failure to act on a fully briefed transfer motion that had been pending for approximately eight months while pressing forward with discovery and claim construction issues amounted to an arbitrary refusal to consider the merits of the transfer motion. Id. at *1?2. We therefore directed the district court to promptly rule and to stay all proceedings pending completion of the motion. Id. at *2.
Our decisions in Google and SK hynix rest on a principle well-established in Fifth Circuit law: That district courts must give promptly filed transfer motions ?top priority? before resolving the substantive issues in the case. In re Horseshoe Entm?t, 337 F.3d 429, 433 (5th Cir. 2003) (?[I]n our view disposition of that [transfer] motion should have taken a top priority in the handling of this case by the . . . District Court.?); see also In re Apple, Inc., 979 F.3d 1332, 1337 (Fed. Cir. 2020 (explaining that ?once a party files a transfer motion, disposing of that motion should un-questionably take top priority.?); In re Nintendo Co., Ltd., 544 F. App?x 934, 941 (Fed. Cir. 2013) (?[A] trial court must first address whether it is a proper and convenient venue before addressing any substantive portion of the case.?).
We agree with TracFone that the circumstances here are comparable to those in Google. As in Google, the facts here establish that the district court has clearly abused its discretion. And, unlike in SK hynix, the court to date has taken no action to suggest it is proceeding towards quick resolution of the motion.
Ouch. Having been benchslapped yet again, Judge Albright announced that he was finally going to start doing what he should have been doing all along: issuing a standing order admitting that certain other issues, such as the important Markman hearing where the judge basically determines what the patent claims cover, would be held off until he was able to review venue transfer requests. Markman hearings don’t need to be held right away, but Judge Albright seemed to push to get them going quickly even while ignoring transfer requests. But now he says he’ll make sure to rule on transfer prior to any Markman hearing:
When there is a pending inter-district transfer, the Court will either promptly enter an
order resolving the pending motion(s) prior to the Markman hearing or it will postpone the Markman hearing until it has had the opportunity to do so. The Court will not conduct a Markman
hearing until it has resolved the pending motion to transfer.
It only took a bunch of CAFC benchslaps to get there. Of course, getting him to rule quickly doesn’t mean that he’ll actually transfer the cases. Three days after CAFC yelled at Albright about the TracFone situation, he denied the transfer request (as well as the dismissal request) even while admitting that TracFone’s preferred venue in South Florida would be more convenient for the witnesses and parties.
Also, it looked like CAFC was on the verge of benchslapping him again, but he (WOW!) actually transferred one case to Houston. Of course, that was after he’d already denied the transfer last summer, and CAFC had already told him to reconsider, which he hadn’t actually gotten around to many months later. The defendant in that case, Nitro Fluids, had gone back to CAFC to ask it to make Albright rule, and thus he finally did so — leading the CAFC to drop the issue as moot.
And, most recently, Albright has denied a request by Microsoft to transfer a patent case out of his court. In this most recent ruling Albright declares that: “A party seeking transfer to an allegedly more convenient forum carries a significant
burden.” I mean, yeah, in your court.
I remain flummoxed as to how this is allowed. I cannot come up with any reasonable explanation for allowing a judge to act this way. It is beyond sketchy. He’s advertising his court as friendly to patent filers, and when defendants seek to move cases to more appropriate venues, he stalls, forces them into expensive processes — despite courts telling him to stop — and when he finally makes a slight nod towards obeying the rules, he still regularly rejects the transfer requests. Even if he and his supporters argue that there’s some reason that all of this makes sense, at the very least, it reeks of gaming the system, bias against patent defendants, and not wanting to play by the rules. It’s shameful behavior by a judge.
Over the last year or so there’s been a concerted effort by patent maximalists to try to shred a long line of very good Supreme Court rulings that finally (after two decades) limited just some of the destructive nature of patent trolling. There was an attempt in Congress to literally reject all of those key Supreme Court cases, and bring back Congress’s full support for patent trolling. The current head of the patent office has been spewing a bunch of similar nonsense as well, and seems to have no recognition that patents that are too broad hinder, rather than help innovation. And now we have Judge Randall Rader, who ran the federal patent court, the Court of Appeals for the Federal Circuit (CAFC), for many years before stepping down due to an ethics scandal.
That ethics scandal? Being way too chummy with patent lawyers who practice before him. As we’ve noted over the years, part of the problem with the setup of CAFC — a special appeals court for all patent appeals cases to go to — was that the judges on it tended over time to buy into patent maximalism, because they basically only spoke to patent lawyers.
Judge Rader has now decided to pop back up again to argue that we need more bad and broad patents in order to enable more patent trolls. Or America won’t be able to compete. Or some such nonsense.
Our country?s founders understood that patents are critical to innovation. For that reason, the principle is enshrined in our Constitution, which grants Congress the power ?to promote the Progress of Science and useful Arts? by awarding ?Inventors the exclusive Right? to their discoveries. Indeed, our patent system incentivized and empowered early inventors like Thomas Edison and Alexander Graham Bell, and helped create today?s technological giants like Apple, Google, Microsoft and IBM.
This is basic economics. Patents guarantee a limited monopoly on inventions (usually 20 years), which lets inventors recoup the costs of research and development, and repay investors who help convert scientific theory into usable technology. It is no coincidence that America in the 20th century had both the strongest patent system and the most powerful economy in the world.
This is ahistorical claptrap. Patents have never been “critical” to innovation. Plenty of studies have shown that innovation occurs in the absence of patent laws (and seems to occur even faster in those markets). And if we’re talking “basic economics” let’s send Judge Rader back to his Econ 101 class. Monopolies are the antithesis of innovation. Inventors recoup the cost of research and development by selling a product in the market. And yes, there are reasonable concerns about copycats, but copycats are what drive innovation. The originator has to keep innovating, and making their product better, and copycats tend to trail innovators.
Indeed, the monopolies are what slow innovation, by taking away the incentive for inventors to actually make their product better. This is why the steam engine didn’t really take off until the patents expired. We see this over and over again.
Also, Rader ignores that while his argument might make sense in a few limited areas of innovation, the vast majority of innovation happening today has nothing to do with patents at all. The R&D cost of developing “software” doesn’t need to be recouped the way he describes, and software is already protected by copyright. Google didn’t rely on the patent system — and it’s insulting to the company to say that they did. Microsoft and Apple didn’t start relying on the patent system until much later in their lives — well past what’s considered their “innovative” period, and only to limit smaller competitors and slow down the pace of innovation.
In short, Judge Rader has no idea what he’s talking about. And that’s just in the lead in to this piece. Because now he’s going to complain that we don’t have more software patents — attacking the most important and useful Supreme Court case in decades, the Alice case that effectively invalidated a ton of ridiculous software patents that never should have been granted. The impact of the Alice ruling was fantastic. Tons of software patents were invalidated. It destroyed the business model of a bunch of patent trolls and it (for a little while at least) got the US Patent Office to start rejecting a bunch of bad patents.
But, of course, the ruling in the Alice case was overruling one of the most ridiculous CAFC rulings in which Judge Rader himself said a bunch of ridiculous things. So now he wants to undo the Supreme Court’s ruling that rejected his ideas about software patents.
In Alice Corp. v. CLS Bank, the Supreme Court ruled that a computer service designed to mitigate risk in financial transactions could not be patented despite the fact that computers and software were involved because the invention related to an ?abstract idea.?
In so ruling, the court undid decades of strong patent protection by throwing open the floodgates to categories of U.S. innovation that would no longer qualify for patent protection. Twenty years ago, America largely protected computer software and emerging technologies while Europe and Asia did not. Since then, patent protection in Europe and Asia has advanced, while the U.S. has taken a huge step backwards with Alice and cases that followed.
The result is that many countries are now more competitive than ours in promoting innovation.
This is ridiculous. Yes, China is doing a lot more patenting than before, but as an anti-competitive tool to block American companies. There is no sign that software patents is why the US is somehow “less competitive” than before. Rader is making that up.
Now the phrase ?abstract idea? does not appear in any patent law that Congress enacted. Despite the fact that almost every invention starts with an abstract idea, the Supreme Court declined to define what the phrase means. It noted that it ?need not labor to delimit the precise contours of the ?abstract ideas? category in this case.?
This is hogwash. The reason abstract ideas are not patentable is because the whole point of the patent system was supposed to be to get inventors to reveal the details of what their invention was so that others could make use of it once the patent expired. But there is no invention of an “abstract idea.” The Supreme Court was right to reject it because the idea of patenting abstract ideas was a huge drain on innovation in the first place, where you just had a bunch of lawyers throwing around dumb ideas, adding “on a computer” or “on the internet” and then being able to shakedown companies that actually innovate.
American companies are now struggling to keep up with foreign competitors like Huawei and Samsung, which benefit from patent rights in their home countries that no longer exist in our own. As Senators Coons and Tillis observed, high-tech inventors ?are receiving patents in Europe and China, but not in the United States. Why should we cede our competitive edge at this critical juncture??
Oh bullshit. They’re not struggling to keep up with foreign companies because of patents, but because of some bad decisions in building out their own product suite — which is part of the reason that Cisco has been pushing efforts to ban Huawei around the world, rather than fighting on an even playing field. It’s not about the patents.
Despite bipartisan support, however, efforts to change the law stalled. Some might think that, in the midst of a global pandemic, Congress was right to put patent rights on the backburner. But the current crisis only highlights the need for reform. Under our current approach to patent eligibility, diagnostic tests for Covid-19 cannot be patented, so the resources and incentives to develop new tests in the U.S. were weak and unready.
Yes, Congress was right to put patent reform on the backburner (and it happened way before COVID-19 because there wasn’t nearly enough support in Congress for the bill). And, again, patents are not the incentive to create tools to fight COVID-19. Public health, public safety, and the market are all doing a pretty fucking good job creating incentives. The idea that we were unready because of weak patent laws is complete and utter hogwash.
Besides, after nationwide shutdowns and an uncertain path to reopening the economy, American industries could use a break.
A break… meaning tons of new patent trolls shutting down the actual innovative companies by a bunch of patent lawyers shaking down the system to buy new yachts? Fuck that.
One hope still remains: the Supreme Court, which has the power to clean up its own mess. One of the Federal Circuit?s most egregious decisions, Chamberlain Group v. Techtronic Industries, is now on appeal to the Supreme Court. In a decision that Senator Tillis called ?madness,? the Federal Circuit put a garage-door opener patent under its sledgehammer. If garage-door openers are too ?abstract? for patenting, what else is left? As the patent owner in the Chamberlain case put it, this is ?a patent emergency.?
As Judge Rader well knows, he is totally misrepresenting the Chamberlain case. The patent was not on a “garage door opener” but a specific type of garage door opener, in which one of the key claims was for “wirelessly communicating status information about a system.” THAT is the “abstract idea” that should not be patentable, because of course that shouldn’t be patentable. We didn’t need a patent system to add a fucking wireless communication system to a garage door opener, Randall. Get real.
What the CAFC, correctly (I should add), found was that if you took out abstract ideas like that, there was nothing inventive at all going on here. This was just combining a few well known ideas into a new use case. And, sure, that should be rewarded, but that’s how the market works. It gets rewarded in the market. Make a better mousetrap, etc. etc. etc. Not hire a lawyer to patent your better mousetrap and then wait for others to make the same obvious mixing and matching of off the shelf technology and sue them out of existence.
Remember Blackbird Technologies? This was the patent trolling firm made up almost entirely of lawyers who insisted they weren’t a law firm… they just bought up patents for basically nothing and then threatened and/or sued a bunch of companies claiming patent infringement. A few years back it was suing basically everyone over some dubious patents. But it made a pretty massive strategic error in suing Cloudlfare because Cloudflare decided to fight back, not just to win its case, but to invalidate as many Blackbird patents as possible, while simultaneously reporting the ethics violations involved in pretending not to be a law firm when you really are (and in what appeared to be trying to purchase the bare right to sue, rather than the actual full patent rights).
That process ended poorly for Blackbird, who lost in court and on appeal, in a fairly demeaning way (the courts gave Cloudflare a complete and total victory — and the appeal was even ruled upon within days of the hearing, which is almost unheard of in such cases). It still cost Cloudflare hundreds of thousands of dollars, but Blackbird had lost many of its employees and had cut back significantly on filing new lawsuits.
And now it’s in even more trouble. The Court of Appeals for the Federal Circuit (CAFC, the appeals court that handles all patent cases) has upheld a lower court’s order telling Blackbird it needs to pay $363,243.80 in legal fees to one of the companies it tried to shake down, Health in Motion LLC (HIM). The court clearly sees what’s going on here, and its recounting of how Blackbird tried to get out of the case is… really something to behold. First, Blackbird sued and, following the typical patent trolling playbook, asked for $80,000 to settle. That number is (purposely) significantly less than it would take to fight the case in court. That’s how the whole patent trolling shakedown process works. Sue, and then offer to settle for less than it would cost the defendant, even if they won the case. But HIM also decided to fight back and told Blackbird that it should pay them for having to waste this time on lawyers. From the CAFC summary, this is a fun read (if you’re confused “Appellees” is HIM, the defendant in the case):
In June 2017, Blackbird offered to settle its case against Appellees for $80,000…. Appellees declined Blackbird?s offer, explaining that Blackbird?s ?infringement allegations lack[ed] merit? ?[i]n view of the substantial differences between what is claimed in the [?]976 [p]atent and the accused device,? …. Appellees also explained that they ?believe[d] there [was] a strong likelihood? that Blackbird would be ordered to pay Appellees? attorney fees, and countered with a settlement offer that included, inter alia, Blackbird ?mak[ing] a payment of $120,000? to Appellees.
In October 2017, Blackbird made another settlement offer, this time for $50,000… (?Blackbird?s counsel . . . made an oral offer to settle the case if [Appellees] paid Blackbird $50,000.?). Again, Appellees declined…. In April 2018, Blackbird offered to settle yet again, this time for $15,000…. Appellees once again declined, ?maintain[ing] their request that Blackbird pay a portion of [Appellees?] expenses[.]?… Later that same month, and again the following month (May 2018), Blackbird offered ?a ?walk-away? settlement whereby [Appellees] would receive a license to the [?976] patent for zero dollars, and the case would be dismissed.?…. Once again, Appellees declined…. (Blackbird?s Vice President and Head of Litigation stating that ?[Appellees], through counsel, have rejected all settlement offers by Blackbird . . . , including the zero-dollar ?walk-away? offer. . . . I understand the reasoning for this to be that [Appellees] have a belief that they will ultimate[ly] be awarded their legal fees after judgment in this matter?).
This is amusing. It’s basically “Pay us $80k to go away.” “No, fuckers, how about you pay us $120k.” “Okay, how about $50k to go away.” “No. You pay us.” “$15k?” “No, you pay us!” “Okay, how about we just walk away for nothing.” “No, dammit, you pay us.”
Given that Blackbird’s trolling strategy flopped pretty spectacularly, they then tried strategy two: run away!
In May 2018, shortly before discovery was scheduled to end, Appellees filed a motion for summary judgment…. Blackbird opposed… but, after Appellees? motion was fully briefed, and without notifying Appellees in advance, Blackbird filed a notice of voluntary dismissal with prejudice… executed a covenant not to sue,… and filed a motion to dismiss for lack of subject matter jurisdiction…. (Appellees? lead counsel explaining that ?Blackbird?s counsel never mentioned that he intended to file a covenant not to sue. . . . Blackbird surprisingly filed a Notice of Dismissal, Covenant Not to Sue[,] and Motion to Dismiss?);… (Appellees? counsel stating that Appellees ?didn?t even get a call from Blackbird, [Appellees] just saw . . . on the [CM/]ECF [system] that [Blackbird] had filed these documents dismissing the case?).
That, right there, is Blackbird realizing “oh fuck, we’re screwed.”
The court notes that in “exceptional” cases,the courts may award legal fees. And this was an exceptional case.
Considering the ?totality of the circumstances,? the District Court found that Blackbird?s case against Appellees is ?exceptional within the meaning of [§] 285 and Octane Fitness.?…. Specifically, the District Court determined that Blackbird?s case against Appellees is ?exceptional? because it ?stand[s] out from . . . others with respect to? both ?the substantive strength of [Blackbird?s] litigation position? and ?the unreasonable manner in which the case [was] litigated? by Blackbird…. The District Court also found that ?granting a fee award [was] warranted? in this case ?to deter future abusive litigation.?… Finally, the District Court concluded that Appellees? requested award of $363,243.80 was reasonable considering each attorney?s ?comparable skill, experience, and reputation.?
And, as the CAFC notes, all of that was exactly right. I won’t go through the full smackdown, but let’s just say that CAFC found Blackbird’s arguments “unpersuasive.” Blackbird tried to argue that it couldn’t have possibly known that its “litigation position was purportedly weak,” but the court highlights that this is belied by the company’s own actions.
…the exercise of even a modicum of due diligence by Blackbird, as part of a presuit investigation, would have revealed the weaknesses in its litigation position.
It also mocks Blackbird’s silly claim that it only would have known that its legal position was weak if it was on notice from the court. As CAFC basically says, Blackbird’s own actions disprove this claim:
It is also unclear what effect, if any, notice would have had on Blackbird?s conduct, as Blackbird waited until the ?eve of trial? to dismiss its suit… despite being aware of Appellees? non-infringement contentions months before….
At a minimum, Blackbird was aware of Appellees? intention to seek attorney fees and expenses as early as December 2016, when, in answering Blackbird?s Original Complaint, Appellees requested attorney fees and expenses….. While this request may not have provided the ?focused? and ?supported? notice that we have looked for in other cases… it undermines Blackbird?s attempt to blame others, including the District Court, for it being purportedly unaware of the weaknesses in its litigation position. Accordingly, the District Court did not abuse its discretion in determining that this case ?stands out? with respect to the lack of substantive strength in Blackbird?s litigation position.
Also, CAFC notes, it wasn’t just Blackbird’s laughably weak legal position that made this “exceptional.” Blackbird’s actions very much contributed to that decision, including its pursuit of “nuisance value settlements” (i.e., trolling).
The District Court did not limit its findings to the substantive strength of Blackbird?s litigation position, and further determined that Blackbird?s case against Appellees was ?exceptional? because Blackbird ?litigated . . . in an unreasonable manner.? … The District Court made multiple findings to support this determination… each of which is supported by the record. First, the District Court found that Blackbird ?made multiple settlement demands that were far less than the anticipated cost of defense,? i.e., nuisance value settlement offers…. By its own admission, Blackbird made a series of decreasing settlement offers… each of which was significantly less than the cost of litigation … (Appellees? litigation costs totaled at least $363,243.80).
Second, the District Court found that Blackbird unreasonably ?delayed in producing documents, withheld many documents until after [Appellees] took [Blackbird?s] deposition[,] and completely failed to produce other responsive documents.?… Again, the record supports the District Court?s findings; indeed, the record shows numerous, unexcused delays by Blackbird in producing documents… as well as Blackbird?s attempts to withhold responsive documents entirely, without notice or excuse, until Appellees learned of the documents during depositions… (Blackbird admitting that it ?had the documents in-house? yet failed to produce them),… (Blackbird admitting ?[t]hat [it] is true? that ?documents identified in th[e] deposition? have never been produced). While Blackbird subsequently implied that some of these documents might be privileged… Blackbird has failed to identify in the record any such assertion of privilege prior to the depositions.
Finally, the District Court determined that Blackbird had unreasonably ?filed a notice of dismissal, covenant not to sue, and motion to dismiss without first notifying [Appellees?] counsel, on the same day pretrial submissions were due and shortly before [Appellees?] motion for summary judgment was to be decided.? … The record supports these findings…. Accordingly, the District Court did not abuse its discretion in determining that this case stands out with respect to the manner in which Blackbird litigated.
Also, the court points out, Blackbird is a damn patent troll who does this type of stuff all the time:
In addition to its findings as to the substantive strength of Blackbird?s litigation position and conduct during litigation, the District Court found that ?granting a fee award [was] warranted? in this case ?to deter future abusive litigation.?… (explaining that Blackbird ?has filed over one hundred patent infringement lawsuits, and none have been decided, on the merits, in favor of [Blackbird]?)
From there, the court looks at the requested attorneys fees and finds them perfectly reasonable… and concludes that Blackbird needs to pay up to the tune of $363,243.80.
Last week, the Solicitor General of the White House weighed in on Google’s request for the Supreme Court to overturn the Federal Circuit’s ridiculously confused ruling in the Oracle/Google case concerning the copyrightability of APIs (and whether or not repurposing them is fair use). Not surprisingly, as the Solicitor General has been siding with Oracle all along, it suggests that the Supreme Court not hear the case. Of course, it does so by completely misrepresenting what’s at stake in the case — pretending that this is about whether or not software source code is copyright-eligible:
This case concerns the copyrightability of computer code. To induce a computer to perform a function,
a person must give the computer written instructions.
Typically, those instructions are written in ?source
code,? which consists of words, numbers, and symbols
in a particular ?programming language,? which has its
own syntax and semantics. The source code is then converted into binary ?object code??ones and zeros?that
is readable by the computer.
It is both ?firmly established? and undisputed in this
case that computer code can be copyrightable as a ?literary work[].? 1 Melville B. Nimmer & David Nimmer,
Nimmer on Copyright ? 2A.10[B] (2019). Section 101
defines a ?computer program? as ?a set of statements
or instructions to be used directly or indirectly in a computer in order to bring about a certain result.?
17 U.S.C. 101. And various Copyright Act provisions
recognize that a person may own a copyright in a ?computer program.?
Except… that’s not what this case is about. Even remotely. Literally no one denies that software source code is subject to copyright. The question is whether or not an Application Programming Interface — an API — is subject to copyright. As we’ve been saying from the beginning, the most frustrating thing about this entire case is that you have non-technically savvy lawyers and judges simply refusing to comprehend that an API is not software. It’s not executable code. It’s not “source code” for software. An API is a set of specifications for allowing the access of data, an application, or service. It’s a “method of operation,” which is simply not subject to copyright law. Indeed, back in 1996, the Supreme Court ruled in Lotus v. Borland that a user interface to a computer program is not subject to copyright under Section 102(b) as the interface is a “method of operation.”
In the Solicitor General’s brief, they wipe this away by insisting that the ruling in Lotus v. Borland is different because that was about an interface, whereas this case is about source code.
The Federal Circuit?s construction of Section 102(b)
in this case does not conflict with those decisions. See
14-410 U.S. Br. 19-22. In Lotus, the First Circuit invoked Section 102(b) to find that the arrangement of menu commands presented to a software user was an
uncopyrightable ??method of operation?? for the software at issue. 49 F.3d at 815-818. The case did not address the copyrightability of computer code, and the
First Circuit has subsequently acknowledged, consistent with the decision below, that Section 102(b) codifies the idea/expression dichotomy.
Right. But this case also does “not address the copyrightability of computer code.” Because it’s not about computer code.
While it’s no surprise that the Solicitor General has now gotten this wrong, what was a little surprising was that Oracle’s lead lawyer in this case, spent half the weekend acting like a common Twitter troll, gaslighting the entire software community on Twitter, making repeatedly false claims about APIs, and then attacking anyone who pointed out that she’s flat out wrong by accusing them of being Google shills.
Annette Hurst, prior to this nonsense, was fairly widely respected intellectual property lawyer and a big time partner at Orrick, one of the largest law firms in the world. She’s been involved in some big copyright cases in the past, such as the famed Mattel v. MGA case (she was on the right side of that one) and also in the important Kirtsaeng case in which she again represented the correct side.
However, when it comes to the Oracle case, she seems to jump in to argue things that are blatantly ignorant of how software actually works. You may recall, after the jury in the district court found that Google’s use of the Java APIs were fair use, she laughably insisted that it would kill open source software because it meant software source code couldn’t be opened up any more. Except, once again, she was totally confusing an API with executable software code.
Years on, and she’s still not just confused, but actively misrepresenting things. Famed and well-respected litigator and law professor Mark Lemley called out the Solicitor General’s “indefensible” statement that Lotus v. Borland does not conflict with this ruling, and Hurst responded dismissively:
Google identified no circuit split so that?s exactly right. At some point you gotta think when the Congress and courts and executive branch keep telling you that you?re wrong, you?re the one who?s actually wrong not them. Software is protected by copyright.
But, again, she’s focusing on the wrong thing. “Software is protected by copyright.” Well, duh. No one disagrees. This case is not about that. It’s about whether or not an API is protected by copyright. But Hurst keeps conflating executable software code and APIs. And while expert after expert called her out on this on Twitter, she just kept digging in deeper, variously calling any critic a Google shill or, perhaps worse, insisting that APIs are executable code.
This is not just wrong, it’s head-slappingly, stupidly wrong. And every single reply to Hurst are people telling her it’s wrong in so many different ways.
The _implementation_ of an API is executable, but not the API itself! Easy to prove: For example, you can paste an API into Compiler Explorer (https://t.co/0GQwXPXQNW ), and then paste an implementation. Only once you paste the implementation do executable instructions appear. pic.twitter.com/24bu30PBNw
have you ever actually written or interacted with an API apart from clicking the mouse on a web page?
The API is the interface to executable code. An API by itself just sits there blankly staring at you.
— Jim V.o.R. aka General Pesky of Wu-Tang (@JimYoull) September 29, 2019
An API is an interface. It's a specification. To say that an API is executable is to say that "the right pedal is the gas and the left pedal is the brake" is executable.
Guessing you are using all those words in special senses where they mean the opposite of what practitioners mean since that statement is clearly nonsense to a Java developer.
As more and more people called out this nonsense, literally her only claim was to argue that anyone taking the other side must have been funded by Google.
What’s doubly ironic here is that the link she puts in that post, is to a shadowy non-profit whose only role in life is to write up laughingly misleading reports accusing tons of people of being Google shills based on shoddy (to downright incorrect) research. It has been forced to run multiple corrections to its bad reporting. And, the best part is: for an organization that claims its sole purpose is to shine a light on what it claims is Google’s secret funding… the Google Transparency Project refuses to name a single one of its own donors. Though, there is one who has taken credit: Oracle. The very company which has probably paid Hurst’s employer enough money for her to buy a few very nice homes just on this case alone.
Hurst may be a great copyright lawyer, but she doesn’t know shit about what an API is, and, incredibly and unfortunately, has convinced the Federal Circuit that an API is no different than software. She may succeed in convincing the Supreme Court that as well, as she’s apparently convinced the Solicitor General. None of that makes it right however. And her going around parading her ignorance and attacking those who actually know what the fuck they’re talking about concerning the difference between an API and executable code is a disgrace.
This is not something that one can just say it’s a difference of opinions over. We can disagree over whether or not APIs should be covered by copyright. That’s an opinion. We can disagree over whether or not Google’s copying of an API should be considered fair use. We can disagree over what we think the state of copyright should be. But what no one can deny is that an API is not executable code. And yet, Hurst continues to argue it and (ridiculously) has convinced some courts of this blatantly incorrect thing, which is helping her client get the opinions it wants on the other things above. And that’s despicable.
You may recall that back in May of 2017, a patent trolling operation called Blackbird Technologies picked on the wrong internet company to troll. Having built up some success blasting frivolous lawsuits at other internet companies, it chose to go after Cloudflare. That was a mistake. Cloudflare didn’t just hit back, it promised to destroy the patent trolling firm, Blackbird Technologies. It opened up a campaign to crowdsource prior art not just on the patent at issue in its lawsuit but on every patent that Blackbird Technology claimed to hold.
Almost exactly a year ago, Cloudflare won its case with the court invalidating the patent. It was such an easy decision that it took US District Court Judge Vince Chhabria barely over a page explaining why the patent was so clearly invalid and the case was dismissed.
Blackbird, for reasons that escape me, decided to appeal to the Federal Circuit. Now, we’ve spent the better part of two decades mocking the Federal Circuit and its history of nutty decisions, but there are some cases so obviously bad that even the CAFC can’t fuck them up. This is one. A CAFC panel heard the case last week and found the situation so utterly stupid that it only took a few days for it to affirm the lower court ruling. Indeed, its ruling is even shorter than the district court’s ruling. The CAFC opinion doesn’t even say anything other than: “Affirmed.”
Ouch.
According to Cloudflare’s General Counsel, Doug Kramer, in a blog post on Cloudflare’s site, the CAFC panel didn’t have a single question for the company’s lawyers (which is nearly unheard of), leaving him with tons of extra time:
A panel of three judges from that court heard arguments on the appeal last Friday, but didn?t ask our attorney a single question about the substance of our argument on the abstractness of the patent. He sat down with almost half of his 15 minutes of argument time left because there was nothing more to say. Yesterday, just three business days after that hearing, the court affirmed the lower court?s decision in summary fashion, which means they didn?t even write about the claims or arguments, they just said ?Affirmed? (see below).
Of course, as Kramer further notes in the post, even “easy victories” take a ton of time and resources, not to mention other kinds of costs that can impact a business in lots of ways:
Blackbird filed this case in March 16, 2017. For nearly two years, anyone doing due diligence on Cloudflare might have had questions about whether there was a cloud over our rights to our technology. And we had to go through a lot of briefing, and the related legal expenses, to get to this point. Blackbird?s combined legal filings at the district court and appellate court amounted to more than 650 pages, our responsive briefs were more than 900 pages.
The two courts spent less than two pages describing a result that was obvious to them, but it took us two years of uncertainty and cost to get there. Federal court litigation doesn?t make anything easy. Even if Blackbird had won the case, it is not clear they would have been able to collect significant damages. Our allegedly infringing use was not a product or feature that we charged for or made money from ? it was essentially posting interstitial messages for various errors. Even though we were able to win this case early in the legal process and keep our costs as low as possible, it?s possible we spent more money resolving this matter than Blackbird would have been able to collect from us after trial.
This is why trolling works. This is why so many plaintiffs use the judicial system as a weapon, even when their lawsuits clearly have no merit. Even to get an “easy win” you can lose, big time.
Already, the US Patent Office is notoriously bad at finding prior art, which has been a big complaint here at Techdirt for over a decade. Part of this is that they limit what they’ll even look at as prior art, unless information is put directly in front of their faces by those trying to invalidate bad patents. Generally, most of the prior art that patent examiners look at consisted of… earlier patents and scientific journals. And that’s not nearly enough for a whole variety of reasons. But, now the Federal Circuit has suggested that even earlier patent applications may not really count as prior art.
At issue was an attempt to invalidate a patent showing prior art in an earlier patent application. Seems like this should be a slam dunk. There’s the patent and an earlier application showing the prior art. Therefore, not novel and not patent eligible. But the courts decided to get nitpicky, and argued that because the prior art in question wasn’t directly in the “claims” of the patent, but in the description, it somehow didn’t count. The brief explains why this is ridiculous:
First, patents are granted to encourage disclosure of new inventions. Granting a patent on an invention already disclosed to the public works the opposite effect, closing off knowledge that was previously free to use.
Second, Ariosa?s rule will render the criteria for patentability unstable over time, even as applied to a single patent, because it renders the prior art status of a patent application dependent on the contents of applications filed later. Under the Federal Circuit?s rule, then, what is prior art one day could evaporate the next, or vice versa.
Third, applicants will have even less motivation to draft narrow claims, which give the public greater notice and certainty as to a patent?s scope. Drafting broad claims will now not only allow them to ensnare more infringers, but will also be necessary to ensure their submission prevents the allowance of claims covering all it teaches.
Fourth, examiners will have to choose between allowing overbroad claims to issue and requiring amendments that narrow the claims, but in so doing, shrink the pool of prior art available to the examiner in future patent applications. This potentially affects incentives both for their substantive work, in terms of whether to allow or reject patent claims, and for their procedural incentives to complete examination more or less quickly.
But it seems there’s an even more basic issue: quibbling over where the prior art lives is not really the key. It’s that the prior art exists at all. Once you have that, it doesn’t matter where it showed up, whether in a patent description or on the back of a bubblegum wrapper, so long as the dates it was created is clear.
Hopefully, the Supreme Court decides it’s worth explaining the basics of patent law to CAFC yet again.
