By: William G. Kratz, Jr. & Darren R. Crew
This issue of our Newsletter continues with an overview that focuses on certain significant court cases in the past year that address significant U.S. patent law issues.
We direct our attention this time to Microsoft Corp. v. AT&T Corp., and Voda v. Gordis Corp. In Microsoft Corp. v. AT&T Corp., the U.S. Supreme Court reversed a decision of the U.S. Court of Appeals for the Federal Circuit (CAFC) and determined that the export of a master version of Windows to foreign manufacturers by Microsoft (in either a disc or via encrypted electronic transmission) is not an infringement under 35 U.S.C. §271(0(1). The master version of Windows exported by Microsoft was used by foreign manufacturers to generate copies, which when installed, enabled a computer to process speech in a manner claimed by an AT&T patent issued in the United States. The Court found that because Microsoft does not export copies of Windows installed on foreign-produced computers, Microsoft does not “supply” such from the United States, as would be covered under §271(f).
AT&T argued that software in the abstract, not just a copy of the software, should qualify as a “component” under §271(f). The Court found that: “[u]ntil it is expressed as a computer-readable ‘copy’, e.g., on a CD-ROM, Windows software – indeed any software detached from an activating medium – remains uncombinable.” The Court compared Windows abstracted from a tangible copy to a detailed set of instructions, similar to a blueprint. A blueprint, while containing precise instructions for construction of a device, is not itself a combinable component of the device. The same would hold true for schematics, templates and prototypes, all of which contain information. Software, uncoupled from a medium, is not a combinable component and §271(1) requires “components” amenable to “combination.” Copying and supplying are separate acts with different consequences, especially when supplying is in the United States and copying is in a foreign country. The Court also held that any doubt that Microsoft’s conduct falls outside the scope of §271(f) would be resolved by the presumption against extraterritoriality. —click here to read more—