Oracle v Google – Success for Oracle, Java APIs can have copyright protection

On Friday the US Court of Appeals for the Federal Circuit issued its much awaited decision in the Oracle v Google case. The case concerned copyright in APIs (Application Programming Interfaces) written by Oracle in the Java programming language. The APIs were licensed by Oracle and used by software developers in apps for smartphones, PCs and other devices.

Oracle discovered that Google was using 37 of its APIs without permission and filed a lawsuit claiming that Google’s Android mobile operating system infringed Oracle’s patents and copyrights. The jury in the original case found no patent infringement (which was not challenged on appeal) and found that Google had infringed Oracle’s copyright in the 37 Java packages but deadlocked on the issue of Google’s ‘fair use’ defence. However, the District Court denied Oracle’s motion for judgment as a matter of law (“JMOL”) and, following further consideration, ruled in favour of Google (except in respect of a specific computer routine known as “rangeCheck” and eight decompiled security files) finding that of the 37 Java API packages at issue, “97 percent of the Android lines were new from Google and the remaining…..elements replicated by Google were free for all to use under the Copyright Act.”

Both Google and Oracle appealed and at the end of last week the Court of Appeals reversed the decision of the District Court and held that the declaring code and the structure, sequence, and organisation of the 37 API packages were entitled to copyright protection. In coming to this decision, the Court considered whether the work was original (originality being a fundamental requirement for copyright protection) and whether the APIs constituted ideas or the expression of an idea. Under both US and EU law, copyright protection is not available for a mere idea but is available for the ‘expression’ of an idea.

In this case Oracle claimed copyright protection with respect to both: (1) the literal elements of its API packages (being the lines of source code); and (2) the non-literal elements (being the structure, sequence, and organization of each of the API packages). Both parties agreed that the APIs met the originality requirement. However, they disagreed upon whether they were an expression of an idea or just an idea itself. The Court found in Oracle’s favour in respect of both elements, finding that that the non-literal elements of the APIs were more than a mere idea and that Oracle had made a choice in how to express those ideas noting that “there were myriad ways in which the API packages could have been organized”.

The US decision has created an even greater divergence of US and EU copyright law. In 2012, the Court of Justice of the EU ruled that whilst source code itself can be afforded copyright protection, APIs and other functional characteristics (such as data formats and function names) cannot be. In reaching this finding the Court stated that “to accept that the functionality of a computer program can be protected by copyright would amount to making it possible to monopolise ideas, to the detriment of technological progress and industrial development”. For software businesses looking to operate on a global scale, this divide is not good news.

This isn’t the end of the story. The Court of Appeals has referred the case back to the District Court for further consideration of Google’s ‘fair use’ defence and even after the ‘fair use’ issue has been decided, it is likely that the case will be subject to further appeals.

ECJ ruling encourages copyright holders to shoot the messenger

In their decision issued last week in the case of UPC Telekabel v Constantin Film, the European Court of Justice (ECJ) confirmed that EU states have the right to issue injunctions requiring internet service providers (ISPs) to block their internet users’ access to copyright-infringing websites.

Whilst at first glance the decision may appear to be a landslide victory for rights owners, the decision also offers welcomed clarity to ISPs on the extent of their obligations to prevent infringements.

The ECJ’s decision arose out of an Austrian case involving an application by two film producers, for an injunction requiring an Austrian ISP to prevent its users accessing a website that enabled its users to stream or download films which infringed the producers’ copyright.

According to Article 8(3) of the Copyright in the Information Society Directive (2001/29) (Directive), national courts have the power to grant a blocking injunction against an ‘intermediary’ whose services are used by a third party, to infringe copyright or related rights. The ECJ’s decision addresses two key issues; firstly, what sort of intermediaries can be subject to injunctions under the Directive, and secondly, what form of injunctions can be granted against them?

Can an injunction be granted against an ISP as an intermediary?

The primary issue to be determined by the court was whether a party making infringing information available on their website ‘uses’ the services of the ISP whose customers access the website to do so, where the ISP’s customers themselves have not committed an infringement, thus providing a jurisdictional platform for courts to grant injunctions against such an ISP.

UPC argued that they had no contractual business relationship with the website operators, having neither made internet access or storage space available to them. Since it could not be established that their direct customers acted unlawfully (although, as the Advocate General Cruz Villalon pointed out in his preceding opinion delivered back in November, it could be assumed with near certainty that they took advantage of the services on offer on the offending website), they maintained that it could not be considered that their services had been used to infringe a copyright or related rights. UPC also emphasised that, in any event, the various blocking measures available were excessively costly, especially as for the most part they could be easily circumvented with minimal technical expertise.

Contrary to the assertions of UPC, the ECJ found that where an ISP’s service users access infringing content on a website, that ISP is in fact an intermediary whose services are used to infringe copyright within the scope of the Directive, and as a result they can be subject to injunctions forcing them to block access to the offending sites. They cited the rationale that the ISP “is an inevitable actor in any transmission of an infringement over the internet between one of its customers and a third party, since in granting access to the network it makes the transmission possible.”

In their decision, the ECJ recognised that, on a practical level, as the services of intermediaries are increasingly used to infringe copyrights, such intermediaries are often ideally placed to take preventative action. The ECJ emphasised that in order to fulfil the key objective of the Directive, which is to guarantee right holders a high level of protection as outlined at Recital 9 of the Directive, ISPs must be included within the parameters of Article 8(3), because to rule otherwise would substantially diminish the protection afforded to such right holders.

This means that in future it will not be necessary to show a specific relationship between a person infringing copyright and the intermediary against whom an injunction may be issued, nor will it be necessary to prove that the customers of the ISP in question actually access the protected subject matter on the known infringing website, as the ECJ reiterated that that spirit of the Directive required Member States to not only take action to bring existing infringements to an end, but also to prevent further infringements, or at least make them more difficult to commit.

Can an injunction be granted without specifying the means of implementing it?

Having decided that an injunction could be granted against an ISP in the circumstances outlined, the ECJ then proceeded to consider the nature of the injunction to be granted, and in particular whether the Austrian court’s approach in leaving the ISP to decide the means to be used in blocking the website was acceptable, or whether the court should be required to specify any prescribed block should be implemented.

In reaching their decision, the ECJ recognised the tension between the ISP’s freedom to conduct a business, the internet users’ freedom of information, and the right holders’ copyright, and emphasised the need to achieve a “fair balance” between these fundamental rights. In assessing whether such a balance had been struck, the ECJ found that by giving the ISP a wide discretion to determine the appropriate measures to implement a block of the website, the Austrian Court’s ‘results’ form of injunction had in fact ensured the optimum business freedom of the ISP, as they could choose to put in place measures best adapted to their available resources and the challenges of carrying on their particular business activities. Furthermore, provided the ISP had taken all measures “capable of being considered reasonable”, they could rest assured that they would not be held liable for breach of the injunction, thus ensuring that an ISP cannot be expected to make unbearable sacrifices in order to protect the conflicting interests of a rights-holder.

In this regard the ECJ judgment differed from the opinion of the Advocate General, where he expressed the view that it would be “incompatible with the weighing of the fundamental rights of the parties to prohibit an ISP generally [from accessing an infringing website] and without ordering specific measures”.

The Advocate General did, however, acknowledge that a specific blocking measure imposed on an ISP relating to a specific website would not automatically be disproportionate simply because it entailed not inconsiderable costs and could be easily circumvented without any special technical knowledge.

The ECJ imposed two conditions on the granting of a general injunction such as that proposed by the Austrian court in order to ensure a fair balance is struck between the fundamental rights of the parties:

(i)            Firstly, measures must not unnecessarily deprive users of the possibility of lawfully accessing the information available, so in other words measures must be strictly targeted to ensure that internet users’ right to freedom of information is not be curtailed more than is necessary; and

(ii)           Secondly, those measures must have the effect of preventing unauthorised access to the protected subject-matter or, at least, of making it difficult to achieve and of seriously discouraging users accessing the infringing subject-matter. This means that courts will not decline to grant an injunction just because there is no fool-proof solution available. As the English High Court has acknowledged “a blocking order may be justified even if it only prevents access by a minority of users”.

The ECJ declined to elaborate further on how best to balance and protect the competing rights of parties in such a case, leaving the ultimate decision as to “fair balance” in the domain of national courts.

In order to ensure that the fundamental rights of internet users are afforded adequate protection, and are not diminished in the wake of an insurgence of applications for injunctions by rights-holders, the ECJ also introduced the concept that internet users can assert their rights before national courts, ensuring that they have a forum for redress where they believe measures imposed by an ISP are unduly restrictive.

The battle is won, but the war has just begun…

Whilst the International Federation of the Phonographic Industry (IFPI) has issued a positive statement in support of the ECJ ruling, which undoubtedly represents a string to their bow in fighting online piracy, the decision is unlikely to have a notable impact on the approach of the UK courts to website blocking. The High Court had already been persuaded to grant specific injunctions against a number of ISPs under domestic intellectual property legislation before the recent judgment came to light, and is likely to continue to grant such orders without hesitation in the future, particularly with the reinforcement of an ECJ decision behind them. Other EU member states are now likely to follow suit, adopting an approach more consistent with that already prescribed by English law.

Whilst those campaigning for better protection of intellectual property rights are celebrating their apparent victory, they may stop to consider that whilst in principle the ECJ ruling is a step in the right direction, in practice the operators of illegal websites, and the ISPs making them available online, are often based outside of Europe or conceal their identity, which means that in reality it is very difficult to pursue them before the courts. Let the historic examples of the difficulty encountered in shutting down notorious copyright-infringing sites such as Pirate Bay serve as a cautionary warning not to celebrate too soon – the road ahead for rights-holder’s crusading against piracy in the internet age is a treacherous one; and for every website you successfully shut down you can all but guarantee the same will resurface under a different address or hosting provider!

Rihanna successful in Topshop t-shirt claim

Pop star Rihanna has successfully sued Topshop for passing off for selling t-shirts featuring her image without her consent.

In the UK (unlike the US) celebrities have no specific right to their own image. Instead they have to rely on the law of passing off to help them protect their image. In the case (Robyn Rihanna Fenty & Others v Arcadia), lawyers for Rihanna claimed that she had established a reputation in the UK and that the unauthorised use of her image had lead the general public to believe that the t-shirts were endorsed by her which had caused damage to her brand.

Lawyers acting for Topshop denied that there had been any misrepresentation and claimed that Rihanna’s team were attempting to assert the concept of ‘image rights’ in the UK noting that her lawyers had spent a long time during the case cross-examining witnesses in relation to image rather than focusing on the fundamental elements for a passing off claim.

In the High Court judgement, Mr Justice ruled in Rihanna’s favour finding that “a substantial number of purchasers are likely to be deceived into buying the t-shirt because of a false belief that it has been authorised by Rihanna herself“.

The case was definitely decided on its facts. Weight was put on the fact that Topshop had previously been involved with celebrity endorsements (such as its collaboration with Kate Moss) and Rihanna’s contract with River Island (a competitor of Topshop) was also an important factor. The judge stated that “To someone who knew Rihanna but did not know her current work, the image is simply one of the person concerned. However to her fans who knew her work, I think this particular image might be well thought to be part of her marketing campaign for that project”. Referring to the t-shirt, he also commented that “The fact it is on sale in a high street retailer is neutral. The fact the high street retailer is Topshop is not neutral. The links between Topshop and famous stars in general, and more importantly the links to Rihanna in particular, will enhance the likelihood in the purchaser’s mind that this garment has been authorised by her”.

The decision does not mean that every unauthorised use of a celebrity’s image will give right to a successful passing off claim. The judge stated that “the mere sale by a trader of a t-shirt bearing an image of a famous person is not an act of passing off” and he made it clear that his decision did not establish an ‘image right’ in the UK or extend the existing laws on privacy. His decision was based solely on the three elements for a successful passing off action: goodwill, misrepresentation and resulting damage. However, the case does illustrate the need for retailers to be cautious when using images of celebrities on products in order to avoid confusing customers and opening themselves up to passing off claims.

Amazon Kindles a row

Amazon have prompted something of an internet storm this week by cancelling a Norwegian customer’s account and wiping all her Kindle books.

It is now reported that the customer’s account has been restored by Amazon, but the incident has highlighted a point that is often overlooked as e-books grow in popularity. Contrary to popular belief, when you purchase a Kindle title on Amazon, you are not “buying a book”, but merely being given a licence to download and read that book, subject to Amazon’s Kindle License [sic] Agreement and Terms of Use.

Those terms are, on the face of it, unequivocal. If you breach the agreement, your rights under it immediately terminate, and Amazon can wipe your entire book collection without any refund:

Termination. Your rights under this Agreement will automatically terminate if you fail to comply with any term of this Agreement. In case of such termination, you must cease all use of the Software, and Amazon may immediately revoke your access to the Service or to Digital Content without refund of any fees. Amazons failure to insist upon or enforce your strict compliance with this Agreement will not constitute a waiver of any of its rights.

In the case of this Norwegian customer, Amazon’s only explanation was that her account was “directly related to another which has been previously closed for abuse of our policies”. Amazon refused to provide any further explanation as to what this other account may have been, or as to the “abuse” of its policies.

What if the customer had been living in the UK? Could Amazon act in a similarly draconian and unaccountable manner? As we can see, their terms of business would appear to allow this. However, could aggrieved consumer argue that EU consumer laws protect them from losing their previously paid-for content?

For these purposes, the main law in the UK is the Unfair Terms in Consumer Contracts Regulations 1999. These provide that:

A contractual term which has not been individually negotiated shall be regarded as unfair if, contrary to the requirement of good faith, it causes a significant imbalance in the parties’ rights and obligations arising under the contract, to the detriment of the consumer.

An unfair term is unenforceable against a consumer. The OFT can also issue “stop now” notices requiring the trader to stop using the unfair term.

The OFT’s guidance on unfair terms gives examples of numerous occasions on which the OFT has held that provisions allowing traders to cancel contracts without giving a refund are unfair. So there would seem to be good grounds for arguing that Amazon’s termination provisions in its Kindle licence agreement are unfair.

The Unfair Terms in Consumer Contracts Regulations do not apply to terms which define “the main subject matter of the contract” (or the price payable). Amazon could try to argue that the “main subject matter” is, by nature, a limited licence that is capable of revocation. Looking at the OFT’s past practice as set out in its guidance, however, I suspect that they’d be given pretty short shrift. It’ll be interesting to see if this is ever tested – maybe someone should make a complaint to the OFT about it?

I also wonder whether this apparent imbalance between consumer perception (“I bought it, so I own it!”) and legal reality may become the subject of future consumer protection legislation, so that “one-time payment” licences for digital content are effectively made irrevocable in all but the most exceptional of circumstances.

Amazon’s actions in this case have led some people to say that they will be cracking the DRM on their Kindle books in order to protect them from future deletion by Amazon. Unfortunately, to do so is unlawful under s.297ZA Copyright, Designs and Patents Act 1988 (and can even be a criminal offence if done commercially). More to the point, circumventing the Kindle’s DRM is itself a breach of Amazon’s terms, potentially leading to termination of your account…

Update: this interesting post on the furore quotes Amazon’s PR as saying:

We would like to clarify our policy on this topic. Account status should not affect any customer’s ability to access their library. If any customer has trouble accessing their content, he or she should contact customer service for help. Thank you for your interest in Kindle.

Kindle users may or may not find that reassuring. The one observation I’d make is that this “policy” is not what Amazon’s terms and conditions say, and what happened to this customer seems more in line with the terms and conditions than with Amazon’s stated policy.

Battle of the tablets: both sides win? Or both sides lose?

The latest twist in the worldwide running battles between Apple and Samsung has been won by Samsung, as the Patents Court in London ruled that Samsung’s Galaxy Tab doesn’t infringe Apple’s registered design for the iPad. The IPKat blog has a good write-up here, and the decision itself is here (.docx).

The test for whether a product infringes a registered design is whether it “produces on the informed user a different overall impression” from the registered design. Judge Birss QC held that, while the two companies’ tablets look “very, very similar” from the front (para 184), the “informed user” would also look at the sides and the back of the device – and here, the Samsung tablets were, Judge Birss considered, very different.

That said, I doubt that Samsung will be rushing to draw customers’ attention to how Judge Birss expressed this difference:

The informed user’s overall impression of each of the Samsung Galaxy Tablets is the following. From the front they belong to the family which includes the Apple design; but the Samsung products are very thin, almost insubstantial members of that family with unusual details on the back. They do not have the same understated and extreme simplicity which is possessed by the Apple design. They are not as cool. The overall impression produced is different.

“They are not as cool”: probably the first time those words have formed the basis for an English judge’s decision!

So the result can be seen as a mutually Pyrrhic victory. Samsung wins its case, but only because its products are “not as cool” as Apple’s; while Apple’s design values win the endorsement of an English judge, but it finds itself unable to enforce its UK registered design against an increasingly significant competitor.

Google Drive vs Dropbox: who owns your stuff?

Who owns the data you store on Google’s new cloud-based storage service (and so-called “Dropbox-killer”), Google Drive?

Following the announcement of Google Drive, a number of people suggested that (unlike Dropbox) Google’s terms and conditions give it “ownership” of the data you store on the service. However, these claims are confusing two separate issues: ownership, and scope of licence.

Google’s terms are, in fact, explicit on the ownership of users’ content (a point that seems to have been overlooked by some of its critics):

Some of our Services allow you to submit content. You retain ownership of any intellectual property rights that you hold in that content. In short, what belongs to you stays yours.

Users do give Google a very wide-ranging licence in respect of that content:

When you upload or otherwise submit content to our Services, you give Google (and those we work with) a worldwide licence to use, host, store, reproduce, modify, create derivative works (such as those resulting from translations, adaptations or other changes that we make so that your content works better with our Services), communicate, publish, publicly perform, publicly display and distribute such content.

But even this is not completely unrestricted:

The rights that you grant in this licence are for the limited purpose of operating, promoting and improving our Services, and to develop new ones.

Anyone with a Google account has already given Google this licence in respect of other services. In some cases, such as Gmail, this licence will cover a lot of material that they would no doubt consider highly sensitive, and certainly not something they would want Google to “communicate, publish, publicly perform, publicly display and distribute”. Google Drive is likely to hold equally sensitive information that currently sits on users’ hard drives.

Google’s licence terms have been compared with those of Dropbox, who have had their own problems over their ownership and licensing terms in the past, but whose terms and conditions now state that:

You retain full ownership to your stuff. We don’t claim any ownership to any of it. These Terms do not grant us any rights to your stuff or intellectual property except for the limited rights that are needed to run the Services, as explained below.

We may need your permission to do things you ask us to do with your stuff, for example, hosting your files, or sharing them at your direction. This includes product features visible to you, for example, image thumbnails or document previews. It also includes design choices we make to technically administer our Services, for example, how we redundantly backup data to keep it safe. You give us the permissions we need to do those things solely to provide the Services.

In practice, the scope of this licence is probably not vastly different from the one in Google’s terms, but it reads more reassuringly for customers, emphasising throughout the “limited” nature of these rights, which are “solely” to provide the services.

What can other web-based, consumer-facing businesses learn from this?

  1. Don’t neglect the legal terms when launching a new product. Yes, I know, I would say that – but Google’s error appears to have been to launch a new product without considering how its existing legal terms would apply (or be perceived to apply) to a product that gives them access to a lot of data previously unavailable to them.
  2. People are highly sensitive about content ownership and licensing – and rightly so, though often I find people (even in a business setting) focus too much on “ownership” and not enough on “scope of use”, which in practice is usually more important. As we’ve seen, Google’s terms are actually clear on ownership of data, but their licensing terms are phrased in such a way that leads many to consider that in practice Google is as good as claiming ownership anyway.
  3. Legalese can backfire. The problem with Google’s terms is that they are phrased in a very “legalistic” way. Lawyers may be able to pick the bones out of verbiage like “use, host, store, reproduce, modify, create derivative works, communicate, publish, publicly perform, publicly display and distribute”, but many users just read this as “all your content are belong to us”. Dropbox learned the hard way that saying simply, in plain English, what you need and intend to do, making it clear that you understand the potential concerns, is the only way to get customers to trust you. It will be interesting to see how Google responds to this same message from customers.

Photographic copyright: higher but wider?

The IP Kat blog has an interesting discussion of copyright infringement of photographs.

To cut a long story short, the High Court was asked to judge on whether copyright in the following image (created by a Mr Fielder, with the copyright owned by Temple Island Collections):

was infringed by the following image (used by New English Teas on the packaging for one of their products):

The court decided that the answer was yes, since the creators of the second image had been aware of the existence of the first image, and were unable to show they hadn’t copied it.

The case highlights a couple of points of general application.

1. Copyright in photographs

The court confirmed that a photograph will only attract copyright if it is the photographer’s own “intellectual creation”, and the judge suggested three aspects which could make a photograph “original”:

  • “specialities of angle of shot, light and shade, exposure and effects achieved with filters, developing techniques and so on”;
  • “creation of the scene to be photographed”;
  • “being in the right place at the right time”.

In this case, the court had no difficulty finding that the first image was Mr Fielder’s own intellectual creation, by reason of its composition and the visual contrasts involved. However, this is a long way from the traditional English law approach in which (as one IP textbook puts it) “pointing the camera at a subject and pressing the shutter” was considered enough to gain copyright protection.

This suggests that many photographs over which copyright is asserted may in fact fall outside the scope of its protection – though elements such as “being in the right place at the right time” would still seem to cast the net quite widely.

2. Infringing copyright in photographs

Again the traditional approach has been that infringing copyright in a photograph involved actually reproducing that photograph (or a substantial part of it). There was nothing to stop you taking your own photograph which happened to incorporate the same features as another image. As the IP Kat observes, this does seem to extend the scope of protection for photographs to include “an idea, a lay-out or a scheme for such a photograph”.

For this reason, it may be that the losing party in this case will hop on the next bus (sorry…) to the Court of Appeal. In the meantime, though, this case highlights some interesting issues in what can be a very sensitive area for photographers: on the one hand confirming that the bar for copyright protection is higher than previously thought, but on the other suggesting that the scope of protection, if acquired at all, may be wider than previously thought.