e-Commerce Docket Sheet

The export of software code from the United States in the form of a master disk, for copying and subsequent installation by a foreign manufacturer on computers made and sold abroad, does not constitute patent infringement under the component-export provisions of 35 U.S.C. '271(f). Microsoft Corp. v. AT&T Corp., No. 05-1056, 2007 U.S. LEXIS 4744 (U.S. April 30, 2007). In reversing the Federal Circuit's finding of infringement, the Supreme Court ruled that because the defendant software developer does not export from the United States the copies of the software that are actually installed on the foreign computers, it is not liable for infringement under Section 271(f). The Court found that copies of the defendant's software could qualify as a 'component' under the statute, but concluded that the copies of the software made from a master disk dispatched from the United States and installed on the foreign computers were not themselves 'supplied' from the United States. The court noted that this so-called 'loophole' in Section 271(f) of the Patent Act is 'properly left for Congress to consider.'

A search-engine company's sale of a trademark term as an advertising keyword to a competitor of the trademark owner constitutes actionable trademark use under the Lanham Act. Google, Inc. v. American Blind & Wallpaper Factory, Inc., No. C 03-5340 (N.D. Cal. Apr. 18, 2007). The court denied the search-engine company's motion for summary judgment on the trademark-use issue, rejecting the search engine company's argument that there was no trademark use because there was no evidence that the search engine permitted purchasers of sponsored links to employ trademarked terms that they did not own in the text or title of their online advertisements. The court ruled that it was implicit in the leading Ninth Circuit Court of Appeals opinion on the issue, Playboy Enterprises v. Netscape, 354 F.3d 1020 (2004), that the practice of 'keying' sponsored Internet banner ads tied to trademarked terms constitutes a use in commerce, and that the Ninth Circuit 'would assume use in commerce here.' The court also concluded that the trademark owner had presented sufficient evidence of likelihood of confusion resulting from the use of its trademarks to create a triable issue of fact.

A computer-controlled accelerator patent that does no more than yield predictable results from the combined elements of prior patents in the same field and is the product of ordinary innovation is obvious under 35 U.S.C. '103, and ineligible for patent protection. KSR International Co. v. Teleflex Inc., No. 04-1350, 2007 U.S. LEXIS 4745 (U.S. April 30, 2007). In reversing the Federal Circuit's ruling that genuine issues of material fact precluded a finding of summary judgment concerning the validity of the plaintiff's patent, the Supreme Court characterized the Federal Circuit's 'teaching, suggestion, or motivation' test for determining obviousness as too 'narrow' and 'rigid,' instead relying on its earlier precedent that set forth a more 'expansive and flexible approach' concerning obviousness. The Court, in agreeing with the district court's decision that the plaintiff's claimed invention was obvious, stated the need for 'caution in granting a patent based on the combination of elements found in the prior art.'

Downloading a digital music file does not constitute a public performance under the Copyright Act because the transmission of a performance, rather than just the transmission and downloading of data consisting of a media file, is required to implicate the public-performance right in a copyrighted work. United States v. ASCAP, No. 41-1395, (S.D.N.Y. Apr. 25, 2007). In granting the defendants' motion for summary judgment, the court, analyzing an issue of first impression, found that in order for a song to be performed, it must be 'transmitted in a manner designed for contemporaneous perception.' The court concluded that, as opposed to music streaming on the Internet, downloading a media file involves copying a digital file from one computer to another 'in the absence of any perceptible rendition.' The court also commented that downloading a music file more properly implicates the right of reproduction under the Copyright Act, citing prior decisions involving peer-to-peer music file-sharing that held that file-sharers who downloaded files containing copyrighted music violated the plaintiffs' rights to reproduce the music.

Search-engine giant Google isn't likely to be found directly liable for providing online links to unauthorized copies of copyrighted images, but it might be secondarily liable for providing access to the unauthorized copies. Perfect 10, Inc., v. Amazon.com, Inc. (9th Cir. May 16, 2007). In upholding the lower court ruling on direct infringement, the appeals court adopted the district court's 'server test' for determining when a computer 'displays' or 'distributes' a copyrighted work. The appeals court rejected the argument that the search engine 'displays' copyrighted images when it creates the impression that the search engine is showing the image within a single Google Web page. On the issues of secondary liability, the appeals court upheld the district court's conclusion that Google is not likely to be found vicariously liable for copyright infringement with respect to unauthorized copies made by search-engine users, but it overruled the district court on the issue of contributory liability for the reproduction, display and distribution of unauthorized copies of copyright images that are stored on third-party Web sites. The appeals court also reversed the lower court's rejection of the search engine's fair-use defense with respect to the creation and storage of 'thumbnail' versions of the copyrighted images on its own servers in conjunction with its image-search function.

Exported Software Installed By
Overseas Makers For Foreign Sale
Doesn't Implicate Patent Act

The export of software code from the United States in the form of a master disk, for copying and subsequent installation by a foreign manufacturer on computers made and sold abroad, does not constitute patent infringement under the component-export provisions of 35 U.S.C. '271(f). Microsoft Corp. v. AT&T Corp., No. 05-1056, 2007 U.S. LEXIS 4744 (U.S. April 30, 2007). In reversing the Federal Circuit's finding of infringement, the Supreme Court ruled that because the defendant software developer does not export from the United States the copies of the software that are actually installed on the foreign computers, it is not liable for infringement under Section 271(f). The Court found that copies of the defendant's software could qualify as a 'component' under the statute, but concluded that the copies of the software made from a master disk dispatched from the United States and installed on the foreign computers were not themselves 'supplied' from the United States. The court noted that this so-called 'loophole' in Section 271(f) of the Patent Act is 'properly left for Congress to consider.'

A search-engine company's sale of a trademark term as an advertising keyword to a competitor of the trademark owner constitutes actionable trademark use under the Lanham Act. Google, Inc. v. American Blind & Wallpaper Factory, Inc., No. C 03-5340 (N.D. Cal. Apr. 18, 2007). The court denied the search-engine company's motion for summary judgment on the trademark-use issue, rejecting the search engine company's argument that there was no trademark use because there was no evidence that the search engine permitted purchasers of sponsored links to employ trademarked terms that they did not own in the text or title of their online advertisements. The court ruled that it was implicit in the leading Ninth Circuit Court of Appeals opinion on the issue, Playboy Enterprises v. Netscape , 354 F.3d 1020 (2004), that the practice of 'keying' sponsored Internet banner ads tied to trademarked terms constitutes a use in commerce, and that the Ninth Circuit 'would assume use in commerce here.' The court also concluded that the trademark owner had presented sufficient evidence of likelihood of confusion resulting from the use of its trademarks to create a triable issue of fact.

A computer-controlled accelerator patent that does no more than yield predictable results from the combined elements of prior patents in the same field and is the product of ordinary innovation is obvious under 35 U.S.C. '103, and ineligible for patent protection. KSR International Co. v. Teleflex Inc., No. 04-1350, 2007 U.S. LEXIS 4745 (U.S. April 30, 2007). In reversing the Federal Circuit's ruling that genuine issues of material fact precluded a finding of summary judgment concerning the validity of the plaintiff's patent, the Supreme Court characterized the Federal Circuit's 'teaching, suggestion, or motivation' test for determining obviousness as too 'narrow' and 'rigid,' instead relying on its earlier precedent that set forth a more 'expansive and flexible approach' concerning obviousness. The Court, in agreeing with the district court's decision that the plaintiff's claimed invention was obvious, stated the need for 'caution in granting a patent based on the combination of elements found in the prior art.'

Downloading a digital music file does not constitute a public performance under the Copyright Act because the transmission of a performance, rather than just the transmission and downloading of data consisting of a media file, is required to implicate the public-performance right in a copyrighted work. United States v. ASCAP, No. 41-1395, (S.D.N.Y. Apr. 25, 2007). In granting the defendants' motion for summary judgment, the court, analyzing an issue of first impression, found that in order for a song to be performed, it must be 'transmitted in a manner designed for contemporaneous perception.' The court concluded that, as opposed to music streaming on the Internet, downloading a media file involves copying a digital file from one computer to another 'in the absence of any perceptible rendition.' The court also commented that downloading a music file more properly implicates the right of reproduction under the Copyright Act, citing prior decisions involving peer-to-peer music file-sharing that held that file-sharers who downloaded files containing copyrighted music violated the plaintiffs' rights to reproduce the music.

Search-engine giant Google isn't likely to be found directly liable for providing online links to unauthorized copies of copyrighted images, but it might be secondarily liable for providing access to the unauthorized copies. Perfect 10, Inc., v. Amazon.com, Inc. (9th Cir. May 16, 2007). In upholding the lower court ruling on direct infringement, the appeals court adopted the district court's 'server test' for determining when a computer 'displays' or 'distributes' a copyrighted work. The appeals court rejected the argument that the search engine 'displays' copyrighted images when it creates the impression that the search engine is showing the image within a single Google Web page. On the issues of secondary liability, the appeals court upheld the district court's conclusion that Google is not likely to be found vicariously liable for copyright infringement with respect to unauthorized copies made by search-engine users, but it overruled the district court on the issue of contributory liability for the reproduction, display and distribution of unauthorized copies of copyright images that are stored on third-party Web sites. The appeals court also reversed the lower court's rejection of the search engine's fair-use defense with respect to the creation and storage of 'thumbnail' versions of the copyrighted images on its own servers in conjunction with its image-search function.