Google Gets Supreme Court Hearing in Oracle Copyright Clash

(Bloomberg) -- The U.S. Supreme Court will hear an appeal from Alphabet Inc.’s Google in a multibillion-dollar clash that has divided Silicon Valley, agreeing to decide whether the company improperly used copyrighted programming code owned by Oracle Corp. in the Android operating system.

The justices said they’ll review a federal appeals court’s conclusion that Google violated Oracle’s copyrights. Oracle says it’s entitled to at least $8.8 billion in damages.

The case, which the court will resolve by July, promises to reshape the U.S. legal protections for software code, particularly the interfaces that let programs and devices communicate with one another. Google contends the appeals court ruling would make it harder to use interfaces to develop new applications.

The ruling “has upended the computer industry’s longstanding expectation that developers are free to use software interfaces to build new computer programs,” Google argued.

The appeals court decision reversed a jury finding that Google’s copying was a legitimate “fair use” of Oracle’s Java programming language.

“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,” the U.S. Court of Appeals for the Federal Circuit said in a 3-0 ruling.

At issue are pre-written directions known as application program interfaces, or APIs, which provide instructions for such functions as connecting to the internet or accessing certain types of files. By using those shortcuts, programmers don’t have to write code from scratch for every function in their software, or change it for every type of device.

Oracle says the Java APIs are freely available to those who want to build applications that run on computers and mobile devices. But the company says it requires a license to use the shortcuts for a competing platform or to embed them in an electronic device.

“We are confident the Supreme Court will preserve long established copyright protections for original software and reject Google’s continuing efforts to avoid responsibility for copying Oracle’s innovations,” said Deborah Hellinger, an Oracle spokeswoman. “In the end, a finding that Google infringed Oracle’s original works will promote, not stifle, future innovation.”

Oracle says Google was facing an existential threat because its search engine -- the source of its advertising revenue -- wasn’t being used on smartphones. Google bought the Android mobile operating system in 2005 and copied Java code to attract developers but refused to take a license, Oracle contends.

‘Incalculable’ Harm

“Naturally, it inflicted incalculable market harm on Oracle,” Oracle told the Supreme Court. “This is the epitome of copyright infringement, whether the work is a news report, a manual, or computer software.”

Android generated $42 billion for Google between 2007 and 2016, according to Oracle court filings. Google said it welcomed the court’s decision to review the case.

“We hope that the court reaffirms the importance of software interoperability in American competitiveness,” said Google’s chief legal officer, Kent Walker. “Developers should be able to create applications across platforms and not be locked into one company’s software.”

At the Supreme Court, Google argues that software interfaces are categorically ineligible for copyright protection. Google also contends that the Federal Circuit restricted the “fair use” defense to copyright infringement so much as to make it impossible for a developer to reuse an interface in a new application.

“What Oracle is seeking here is nothing less than complete control over a community of developers that have invested in learning the free and open Java language,” Google argued.

The Trump administration is backing Oracle at the Supreme Court and urged the justices to reject the appeal. Microsoft Corp., Mozilla Corp. and Red Hat Inc. are among the companies that urged the Supreme Court to give Google a hearing.

The appeal encompasses two decisions by the Federal Circuit in the six-year-long battle. The first is a 2014 decision that the programming language can be copyrighted, and the second is a 2018 ruling that overturned the jury’s verdict of “fair use.” The Supreme Court had previously rejected Google’s petition over the 2014 decision.If Oracle wins, the case will go back to a federal jury in California, where the only issue will be how much Google should pay in damages. Should Google win on either question, that would end the case.

The case is Google v. Oracle America, 18-956.

(Updates with company comments beginning in ninth paragraph.)

--With assistance from Naomi Nix.

To contact the reporters on this story: Greg Stohr in Washington at gstohr@bloomberg.net;Susan Decker in Washington at sdecker1@bloomberg.net

To contact the editors responsible for this story: Joe Sobczyk at jsobczyk@bloomberg.net, Elizabeth Wasserman, Jon Morgan

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