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Billions Once Again on the Line After Federal Circuit’s Reversal in Oracle v. Google

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By Rachael Peters Pugel and David G. Barker

The Federal Circuit has reversed, for the second time, the much-followed copyright infringement case, Oracle America, Inc. v. Google LLC, which has been ongoing since 2010.  Oracle filed suit alleging Google copied and used 37 packages of Oracle’s Java application programming interface (“API”), as well as the structure, sequence, and organization (“SSO”) of those API packages, in its Android smartphone platform.

Google and Oracle’s predecessor, Sun, began discussing Google’s licensing of the Java platform for mobile devices in 2005.  But the parties were unable to come to an agreement.  Google then worked to create its own APIs without success before choosing to copy and use 37 of Oracle’s Java APIs in its Android platform.  Google began selling Android smartphones in 2007.  Oracle argued that many of its customers either switched to Android or used Android to negotiate discounted prices, including Amazon, which was able to obtain a discounted license to use Java in the Kindle tablet.

After a trial in 2012, a jury found that Google had infringed Oracle’s copyrights in the API packages but was unable to decide whether Google’s use of the APIs was fair use.  Fair use permits the use of a copyrighted work in limited instances when that use furthers the Copyright Act’s goals of “promot[ing] the Progress of Science and useful Arts” (see other posts on fair use here, here, and here).  If the jury had found Google’s use of the APIs to be fair use, Google would not have been liable for infringement.  But the district court overturned that verdict and held that the APIs were not copyrightable material and therefore could not be infringed.

Oracle appealed to the Federal Circuit and, in a 2014 decision, the court reversed the district court and reinstated the jury’s verdict of infringement.  Google filed a petition for certiorari to the United States Supreme Court, but the Court declined to hear the case.  After a second trial, the jury found Google’s use of the APIs in the Android platform was fair use, and Oracle once again appealed.

In this week’s opinion, the Federal Circuit reversed the jury’s verdict and held that Google’s use of the API packages was not fair use.  The court stated that Google’s use was “inherently unfair” because Google had copied Oracle’s APIs verbatim to create a competing platform that had prevented Oracle from participating in the developing smartphone market.  According to the court, if Google’s use was deemed “fair,” it would “allow[] Google to commercially exploit Oracle’s work[.]”  “There is nothing fair about taking a copyrighted work verbatim and using it for the same purpose and function as the original in a competing platform.”

This most recent ruling by the Federal Circuit means that a third trial may occur to determine Oracle’s damages.  Oracle previously has sought $8.8 billion in damages.