Google v. Oracle: copyright myths and the evisceration of copyright.
This article appeared in the European Intellectual Property Review in 2021. It takes a look at the Google v Oracle case in the US Supreme Court, in which the Supreme Court demonstrated its total cluelessness when it comes to reasoning intelligently about copyright.
The minority judgement was written by Clarence Thomas who, in polite legal terms, told the majority of the Supreme Court that they didn’t know their arse from their elbow.
Footnotes are at the end.
Background
After more than a decade of litigation, on April 5, 2021, the Supreme Court of the United States ruled in favour of Google in its long copyright dispute with Oracle, in a 6-2 majority decision. The Court did not address the question of whether Oracle's Java API was copyrightable, but held that Google's copying of 11,500 lines of declaring code—a key part of the Java interface--was a fair use.
Oracle originally started legal proceedings against Google in the United States District Court for the Northern District of California in 2010. Google had copied (verbatim) 37 packages of Java Application Programming Interface and used it to build its Android platform for mobile devices. After a first trial, in April 2012, the jury found that Google's use infringed Oracle's copyrights but was deadlocked on the issue of whether Google had a valid fair use defence. Setting aside the jury's finding, the district court held that the APIs were not copyrightable as a matter of law, and entered judgment in favour of Google. Oracle appealed to the Federal Circuit.
The Federal Circuit overruled the District Court, ruling that Oracle's Java API was entitled to copyright protection. In its decision, the Federal Circuit relied on the fact that Google "could have structured Android differently," "could have chosen different ways to express and implement the functionality that it copied," and could have offered the very same functionality without copying the declaring code from Oracle.
The District Court held a second jury trial to resolve Google's fair use defence. The jury ruled in favour of Google, Oracle again appealed, and the Federal Circuit again overruled the District Court. The Federal Circuit court took the view that although “Google could have furthered copyright's goals of promoting creative expression and innovation by developing its own APIs, or by licensing Oracle's APIs for use in developing a new platform, it chose to copy Oracle's creative efforts instead." The Federal Circuit concluded that "there is nothing fair about taking copyrighted work verbatim and using it for the same purpose and function as the original in a competing platform”.
Google appealed again, and the case went to the Supreme Court.
Article starts here
“Oracle spent years developing a programming library that successfully attracted software developers, thus enhancing the value of Oracle’s products. Google sought a license to use the library in Android, the operating system it was developing for mobile phones. But when the companies could not agree on terms, Google simply copied verbatim 11,500 lines of code from the library. As a result, it erased 97.5% of the value of Oracle’s partnership with Amazon, made tens of billions of dollars, and established its position as the owner of the largest mobile operating system in the world. Despite this, the majority holds that this copying was fair use.”
This is the opening paragraph of the minority judgement in the landmark case of Google v Oracle, a case is likely to be remembered more for the excoriating, coherent analysis of Thomas J (who wrote the dissenting judgement) than it will be for the sloppy reasoning of the majority. It is very rare for a minority judgement to so deliberately take to task the entirety of a majority judgement, and to so effectively dismantle it. Thomas J did not pull any punches: “The majority has used fair use to eviscerate” copyright.
It became clear early in the majority’s judgement that it was reluctant to take any decisions that would have an immediate impact on the status quo. The court had been asked to resolve two questions. 1. Was the Java API copyright? 2. If it was, did Google’s use constitute “fair use”? The majority ducked the first question: “Given the rapidly changing technological, economic, and business-related circumstances, we believe we should not answer more than is necessary to resolve the parties’ dispute….”. (As Thomas J laconically remarked in relation to rapidly changing technological, economic, and business-related circumstances: “That, of course, has been a constant where computers are concerned.”). Having ducked a golden opportunity for a supreme court to lay down the ground rules for a key industry, the court went on to analyse fair use, and concluded that Google’s use was fair.
The purpose of this article is not to analyse the majority’s application of the US law of copyright (Thomas J’s minority judgement has made that unnecessary), but to look at some more common myths which appear when courts are asked to apply copyright to technology. As the court remarked, “Generically speaking, computer programs differ from books, films, and many other “literary works” in that such programs almost always serve functional purposes. These and other differences have led at least some judges to complain that “applying copyright law to computer programs is like assembling a jigsaw puzzle whose pieces do not quite fit.””
The purpose of copyright
The court made a number of references to the Constitutional justification for copyright, it being to “promote the Progress of Science and useful Arts”. This is a society-based justification: we allow copyright because it benefits us as a society. Little regard was given to the equally compelling, arguably more compelling, view: that the purpose of copyright should be to provide a means by which the producers of copyright works can recover the work they have invested. In other words, a rights-based view which, for most people, aligns with a sense of fairness. If I create something, is it fair to allow someone else to take the economic benefit without my permission? Any court, or legal system, which downplays or disregards a rights-based view will tend to reduce the protection available to the owners of copyright works. And since, in a market economy, the ex-ante knowledge that I can monetise my product is an important factor in deciding to produce, it is likely that a downplaying of a rights-based justification also results in a disadvantage to society as a whole.
The merger myth
The merger doctrine holds that if there is only one possible form for a work, there is therefore no room for expression, and therefore no copyright (or, at least, the copyright is thin).
Before deciding on the extent to which the merger doctrine is helpful in making decisions about copyright, it’s worth considering the nature of a copyright as a type of property. Compared to other forms of property (patents, property in goods, property in real estate), copyright is the least rivalrous[1] of property types. Property in physical goods and real estate is, by its nature, rivalrous: there is a finite amount of physical goods and property to go round, and therefore a person’s property in physical goods or real estate necessarily excludes others having property in the same good or piece of real estate. (Hence, rivalrous. It’s worth bearing in mind that something that can be rivalrous at a property level, but not so rivalrous at a use level. I am the only owner of my hammer, but because my use of the hammer does not consume it, I can let others use it too).
Copyright is non-rivalrous not only at the use level, but also at the property level. We all know that digital works are non-rivalrous at the use level (there can be an infinity of copies of digital work without consuming the first copy), but we often forget that copyright is non-rivalrous at the property level. For example, Person A can create an identical copyright work to Person B but, provided there has been no copying, the two identical works are separately and validly copyright.
How does the non-rivalrous nature of copyright affect functional works? Assume that I want to create a list of all the dentists in London. Let us also assume that no such list presently exists, and that such a list would be protected by copyright. I then create the list. According to classical copyright theory (ignoring “sweat of the brow” copyright), there is no expression here, and therefore no copyright (or, at best, copyright is thin). But if we can a step back, we can see allowing copyright in this scenario can only promote “the Progress of Science and useful Arts”, because the next person who needs to access a list of all the dentists in London now has two choices: she can now, independently, create her own (identical) version of the work, or she can get a licence from me. Which she chooses will depend on a number of factors, including whether the licence fee I am proposing to charge represents less cost than creating her own identical version of the work, but overall she (and everyone else) is now better off. I have not adversely affected the status quo: the information she seeks is still there, and at the same cost. But I have created a new route to the same information. The property in my list is non-rivalrous.
The example works just as well for a computer program or a piece of functional prose as it does for a compilation of data. The merger doctrine is a myth (no doubt dating from a time where copyright was a privilege which required a contribution over and above the ordinary) which serves no useful purpose for a society where the function of copyright is to promote the Progress of Science and useful Arts (and in the USA, the useful Arts, not just the Arts). All it does is reduce the incentives for the production of functional (ie. useful) works.
The myth of creativity in copyright
At the opposite end (at least, in copyright theory) of the functional is the creative. In the EU, the need for creativity, as opposed to creation, has been removed by harmonisation at “the author’s own intellectual creation” (though, perversely, the database right still requires a substantial investment to come into being). Yet, the association of copyright with creativity still persists, despite the fact that the bulk of copyright works are banal (think of the trillions of emails, Facebook and LinkedIn posts sent and posted each year).
Historically, a lack of creativity has been a reason to deny copyright, but in the Google v Oracle, the majority of the Supreme Court develops a new theory of creativity: meritorious creativity, as opposed to unmeritorious creativity.
The implementing code, which Google wrote itself, represented meritorious creativity. It was “magic”, “innovative”, “the very creativity that was needed”.
On the other hand, the declaring code, which Google copied, represented unmeritorious creativity. The “declaring code ….embodies a different kind of creativity. …
Declaring code …. is user facing. It must be designed and organized in a way that is intuitive and understandable to developers so that they can invoke it”. “…unlike many other programs, its use is inherently bound together with uncopyrightable ideas (general task division and organization) [as opposed to]…..new creative expression [such as Google’s implementing code]… the declaring code is, if copyrightable at all, further than are most computer programs (such as the implementing code) from the core of copyright.”
On “inherently bound together with uncopyrightable ideas”, Thomas J is damning: “Is anything not? Books are inherently bound with uncopyrightable ideas—the use of chapters, having a plot, or including dialogue or footnotes. This does not place books far “from the core of copyright.” And implementing code, which the majority concedes is copyrightable, is inherently bound up with “the division of computing tasks” that cannot be copyrighted”.
But there is a more central problem. Creativity is being used as a proxy for value: the (meritorious) creative elements of a copyright work will often be the elements of the work that are perceived to add value. If that is the case, then it is a strange choice indeed to have the legal system act as an assessor (and gatekeeper) of value when we have markets that can assess value in a much more efficient manner.
The myth of copyright as a monopoly right
According to the majority, the basic purpose of fair use is “providing a context-based check that can help to keep a copyright monopoly within its lawful bounds”. [emphasis added]
As soon as a court refers to copyright as a monopoly right, you can be sure of two things. Firstly, the court has a limited grasp of economics. Secondly, the court is going to restrict or deny the copyright holder’s rights. But monopoly is an assessment of economic power: it is impossible to determine whether someone has a monopoly without having determined the product market, the geographic market, and the extent to which the person in question is capable of acting independently of the market.
To use the word monopoly as a synonym for an exclusive right is at best tautologous (if monopoly is being used to mean an exclusive right) or, worse, a dangerous non-sequitur. But it is a usage which occurs frequently when courts reason with copyright, even though no court would refer to someone’s ownership of a car or washing machine as a monopoly right.
Both physical property and intellectual property right can, in the right circumstances, form the basis of monopoly, and this is the direction of the court’s thinking when it stated: “given programmers’ investment in learning the Sun Java API, to allow enforcement of Oracle’s copyright here would risk harm to the public. Given the costs and difficulties of producing alternative APIs with similar appeal to programmers, allowing enforcement here would make of the Sun Java API’s declaring code a lock limiting the future creativity of new programs. Oracle alone would hold the key”. [emphasis added].
The nature of property rights is that they are, in general, exclusive, meaning that each of us “holds the key” to the things we own. And the nature of market economies is that we are, in general, happy with that approach: every single player in the market holds the key to her products and her properties, and we rely on supply and demand to allocate resources in an optimal manner. This is Adam Smith’s invisible hand. There are two situations where Adam Smith’s invisible hand is recognised not to work, and those are cartels and monopolies. These are the subject-matter of competition law, and within the subject matter of monopoly-related competition law is a subset called the essential facilities doctrine. The essential facilities doctrine, in summary, holds that the owner of a facility (read: property, which could be physical or intellectual ) may, by reason of her ownership, have a dominant position on a market, and that her refusal to give access to the facility to competitors on fair or non-discriminatory terms may therefore constitute an abuse.
Obviously, it is arguable that Oracle’s ownership of the Java API may have been such a facility and a refusal by Oracle to licence it on non-discriminatory terms may have constituted an abuse. But any conclusion of that nature is, in the context of competition law, preceded by an extensive economic analysis of product markets, geographic markets, market structure, ease of market entry, etc, before a conclusion of dominant position can be reached. But what is extraordinary is a) that the court seemed to be totally ignorant of this whole school of law and was prepared to reach what is effectively a finding of market dominance (“Oracle alone would hold the key”) with only the most limited consideration of the economics of the relevant market[2], and b) having reached a finding of dominance, effectively ordered licensing of the API at zero cost.
Had the issue reached the court as a competition law issue, and had dominance been found, the court would have ordered the licensing on fair terms, not at a zero price. The difference, based on Oracle’s damages claim, is about $8.8 billion. The end result? Google, owner of Android, the mobile phone operating system installed on 72%[3] of the world’s mobile phones, and therefore clearly a monopolist, gets a free licence to someone else’s work, all in the name of preserving competition.[4] You could not make this up.
Conclusion
On reading and re-reading the majority’s judgement, it is very hard not to conclude that the majority had first decided on the outcome of the case and, having made that decision, tailored its reasoning to fit. Unfortunately, its reasoning does not fit, and in the attempt to make if fit (and fit for purpose), its reasoning has been pummelled, stretched and generally manipulated to an implausible degree. The majority’s judgement represents one of the lowest points of IPR jurisprudence, and only Thomas J and Alito J’s minority judgement provides any saving grace.
[1] https://en.wikipedia.org/wiki/Rivalry_(economics).
[2] The US doctrine of fair use sets out four factors to be considered, and the fourth of these is the effects on the market. However, this light-touch economic analysis only makes sense within the Constitutional scope of fair use: criticism, comment, news reporting, teaching, scholarship, research.
[3] https://gs.statcounter.com/os-market-share/mobile/worldwide. See also https://www.statista.com/statistics/272698/global-market-share-held-by-mobile-operating-systems-since-2009/.
[4] And as Thomas J pointed out, both Microsoft and Apple had managed to develop their own smartphone operating systems without using the Java API.