October 9, 2020
On October 7, 2020, the Supreme Court heard oral arguments in Google LLC v. Oracle America, Inc., a case that should decide the copyrightability of software application programming interfaces (APIs) and the boundaries of fair use of those APIs. As explained in an earlier IP Advisory, the case stems from Google’s replication of Java APIs in the Android mobile operating system. Oracle asserts that the Java APIs are protected by copyright, and that Google’s actions did not qualify as fair use. The Court of Appeals for the Federal Circuit (CAFC) found in Oracle’s favor on both issues, and Google successfully petitioned the Supreme Court to review the CAFC’s decisions.
In the Supreme Court hearing, there was considerable focus on the “merger doctrine,” which states that copyright is not available where there is only a very limited number of ways to express an idea. Google argued that the merger doctrine applies because the Java APIs are the only way to write code to the Java language specification. Google asked the Court to find that “declaring codes” that specify how to use a function are not copyrightable, in contrast to “implementing codes” that perform the function itself. The Court and parties explored the distinction with analogies ranging from restaurant menus to safecracking. Justice Breyer in particular seemed sympathetic to Google’s argument, likening an API to the layout of a QWERTY keyboard that is separate from the keyboard’s mechanical functions.
Other Justices – including Chief Justice Roberts and Justice Kagan – appeared more receptive to Oracle’s counterargument that the Java APIs are not the only option available to mobile application developers. Some companies, such as Apple and Microsoft, have developed mobile device platforms without relying on Java, while other companies have negotiated licensing agreements with Oracle. Oracle further argued that because the Copyright Act and prior courts have not distinguished between declaring codes and implementing codes in terms of copyrightability, the Court should not do so now.
Even if the Java APIs are copyrightable, Google asserted, its use of those APIs was fair use. Moving the Java APIs from personal computers to mobile devices was “transformative,” Google argued, and “there was enormous creativity unleashed” in the form of third-party mobile application development. Oracle countered that Google used the Java APIs in exactly the way they were intended and selectively copied the portions of the Java APIs that had carryover to mobile devices. Quoting an earlier Supreme Court case, Campbell v. Acuff-Rose Music, Inc. (1994), Oracle argued that Google merely sought to “avoid the drudgery” associated with developing its own technology. Here, the Justices did not seem to lean heavily in either direction, although Justice Alito seemed to suggest that the beneficial effect of Google’s actions on Android’s market value weighs heavily against a finding of fair use.
Standard of Review
While defending its actions as fair use, Google also asserted that the CAFC applied the improper standard of review when it overturned the jury’s finding of fair use. Determining fair use involves a weighing of legal factors applied to factual findings, and Google argued that the CAFC did not give proper deference to the jury’s weighing of those factors. Oracle countered that the CAFC found that “no reasonable jury” could find fair use, given the facts presented. Oracle further suggested that judges, not juries, have the “institutional competence” required to properly weigh the legal factors and provide “stability” in this area of law. Google disagreed, noting that jury instructions are designed to ensure that juries apply the law correctly.
While the Court asked both parties to opine on whether the CAFC applied the correct standard of review, none of the Justices tipped their hand during the arguments. Ultimately, even if the Court finds that the Java APIs are copyrightable, it could still ask the CAFC to reconsider the jury’s findings under a more deferential standard. Besides affecting the outcome of this particular case, such a decision could have broad implications for lower courts’ ability to render summary judgments and review jury findings in fair use disputes.
A running theme during the oral arguments was the effect the Court’s decision will have on the software industry. Would a finding in Oracle’s favor upend an unspoken understanding in the software industry that developers are free to replicate APIs, so long as they don’t copy the underlying code? Would a finding in Google’s favor stifle innovation and destroy a lucrative market for licensing software APIs? Will Oracle be “punished” for Java’s success, or is it trying to assert a patent-like right over code that should be freely accessible? While the Justices noted that “sky is falling” concerns have not materialized in the time since the CAFC decision, these concerns clearly will factor into their deliberations.
An opinion is expected before the Court recesses in late June or early July 2021. However, many opinions are handed down within a few months. The timing depends, in part, on how much deliberation the Court needs to reach a majority opinion. Meanwhile, the software industry is holding its breath for a decision that, whichever way it is decided, could upend entire business models.