Business Law Journal

On April 5, 2021, the Supreme Court put an end to the decade-long copyright dispute between tech giants Google and Oracle America.  In a 6-2 decision authored by Justice Breyer, the Supreme Court held in Google LLC v. Oracle America, Inc., 593 U.S. ___ (2021), that Google’s copying of approximately 11,500 lines of code from Oracle’s Java SE Application Programming Interface (“API”) was “fair use” and, therefore, did not constitute copyright infringement.  The Court’s decision will undoubtedly have ramifications for decades to come on the “fair use” doctrine in commercial works, and in particular in the use of computer code in commercial software.

The two questions before the Court were:  (1) whether the Java SE code that Google copied was entitled to copyright protection in light of the Copyright Act’s inclusion of computer programs as copyrightable material and its prohibition on protection for “processes” and “methods of operation,” and (2) assuming the code was copyrightable, whether Google’s use qualified as “fair use.”  Recognizing that “a holding for Google on either question presented would dispense with Oracle’s copyright claims,” the Court only answered the fair use inquiry.  In view of “the rapidly changing technological, economic, and business-related circumstances,” the Court exercised judicial restraint by stating it would “not answer more than is necessary to resolve the parties’ dispute.”  Although Google could have prevailed had the Court found that the API was not copyrightable, the Court saved that question for another day and assumed for the sake of argument that it was.

Justice Breyer, joined by Chief Justice Roberts and Justices Sotomayor, Kagan, Gorsuch, and Kavanaugh, focused on the fair use defense by analyzing each of the four statutory factors enumerated in 17 U.S.C. § 107:  (1) the purpose and character of the use; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect of the use upon the potential market for or value of the copyrighted work.  The Court found that each factor weighed in Google’s favor, thereby reversing the Federal Circuit’s decision to the contrary.

Justice Thomas, joined by Justice Alito, dissented, stating that the majority erred by not answering the question of copyrightability and that the fair use factors actually favored Oracle.  The dissent criticized the majority’s approach of sidestepping the question of whether the API was copyrightable, arguing that the majority’s failure to address the issue distorted its fair use analysis and ultimately rendered the code as “less worthy of protection.”

The Court’s decision sets an important precedent as it has the potential to significantly expand the fair use doctrine, even in non-computer software contexts.  If you are an author, musician, programmer, or other content creator, or have been accused of copyright infringement, it is important to consult with experienced intellectual property counsel to determine how the decision impacts you.

AALRR has a dedicated group of attorneys on its Intellectual Property Team with the experience and expertise to vigorously enforce your copyrights and defend you against claims of copyright infringement.  Attorneys on the Firm’s Intellectual Property Team can also assist you with registration of your copyrights with the United States Copyright Office.  Contact the authors for assistance with your copyright and other intellectual property needs.

This AALRR post is intended for informational purposes only and should not be relied upon in reaching a conclusion in a particular area of law. Applicability of the legal principles discussed may differ substantially in individual situations. Receipt of this or any other AALRR publication does not create an attorney-client relationship. The Firm is not responsible for inadvertent errors that may occur in the publishing process. 

© 2021 Atkinson, Andelson, Loya, Ruud & Romo

In a recent letter to members of the U.S. Senate Finance Committee, dated February 18, 2021, the United States Treasury Inspector General for Tax Administration (the “Inspector General”) outlined a potential disagreement with the Criminal Investigations Division of the Internal Revenue Service (“Criminal Investigations”) regarding the need for a search warrant to utilize databases containing cell phone users’ GPS data.  On one hand, the Inspector General indicated that courts may use “similar logic” to expand a 2018 Supreme Court decision requiring a search warrant to access cell-site location information to likewise apply to GPS data provided to applications operated by third parties.  On the other hand, the letter provides the stated position of Criminal Investigations, which asserts that “Cell Site Location Information [] is distinct from [] opt-in app data,” in apparent reference to the division’s prior claim that GPS data collected by cell phone applications does not require a search warrant because it has been “voluntarily” provided to a third-party.

In order to resolve a COVID-era class action lawsuit concerning its retail stores, Nike has agreed to provide all retail store employees with transparent, see-through face coverings to accommodate its customers who are deaf or hard of hearing and rely on lip reading. Nike’s new policy is part of a proposed settlement following a class action suit against the shoe company’s retail operations.

Three months since our last update on the impact of COVID-19 on commercial lease payment obligations (here), COVID-19 continues its onslaught throughout the United States with now more than 717,000 confirmed cases in California alone. The State of Emergency in California continues, and the Executive Order that previously granted local jurisdictions the authority to impose moratoriums on residential and commercial evictions has likewise been extended. This alert will address the continuing moratoriums on commercial evictions throughout various jurisdictions at the local level, and their impact on commercial lease payment obligations.

On Friday, May 29, 2020, the California Department of Public Health approved Los Angeles County’s variance request to move further into Stage Two of the California Resiliency Roadmap, allowing Los Angeles County restaurants to provide in-person dining service and hair salons and barbershops to reopen.

On May 14, 2020, the Supreme Court unanimously ruled in favor of denim company Lucky Brand Dungarees, Inc. (“Lucky Brand”) in its decades-long trademark dispute with Marcel Fashions Group, Inc. (“Marcel”), holding that Lucky Brand was not precluded from asserting an unlitigated defense from a prior lawsuit with Marcel.  In Lucky Brand Dungarees, Inc., et al. v. Marcel Fashions Group, Inc., 590 U.S. ___ (2020), the Supreme Court rejected the Second Circuit’s application of the so-called “defense preclusion” doctrine and confirmed that any preclusion of a litigant’s defenses must comply with traditional res judicata principles.

On Saturday, May 23, Orange County obtained approval from the State for its variance request to move further into Stage Two of the California Resiliency Roadmap, allowing Orange County restaurants to reopen for dine-in service and previously closed destination retailers to welcome customers back for in-store shopping, provided the businesses follow County and State guidelines for reopening, as explained below.

On April 23, 2020, the United States Supreme Court ruled that a trademark holder need not prove that the infringement of its trademark was willful in order to recover an award of the infringer’s profits.  The Court’s decision in Romag Fasteners, Inc. v. Fossil, Inc. resolves a longstanding circuit split and may make it easier for trademark holders in many jurisdictions, including the Ninth Circuit, to recover damages in trademark infringement cases. 

On March 23, 2020, the Supreme Court unanimously held in Allen v. Cooper that, absent consent, states cannot be sued for copyright infringement and are shielded from such actions under the doctrine of sovereign immunity.  The Court found that the Copyright Remedy Clarification Act of 1990 (CRCA), which expressly provided that states “shall not be immune” under any doctrine of sovereign immunity for copyright infringement, was an unconstitutional abrogation of state sovereign immunity.  However, the Court also noted that its decision would “not prevent Congress from passing a valid copyright abrogation law in the future” that is more tailored to pass constitutional muster.

The California Consumer Privacy Act (CCPA) went into effect on January 1, 2020.  Is your business prepared and in compliance with the new law?