Legally Protecting Software: Benefits, Pitfalls, and Misconceptions

Michael Leachman Blair Suire Jones Walker LLP

Legally Protecting Software: Benefits, Pitfalls and Misconceptions

COPYRIGHTS

TYPES OF INTELLECTUAL PROPERTY

Copyrights

Patents

Trade Secrets

Trademarks

TYPES OF INTELLECTUAL PROPERTY

Artistic Expression

Inventive Concepts

Confidential Information

Brands

TYPES OF INTELLECTUAL PROPERTY

Source & Object Code; Look and Feel

Novel Process

Implemented by Code

Source Code

Company Name; Logos

COPYRIGHTS

v  Literary works (books, catalogues, printed advertising, websites, software)

v  Musical works (music, lyrics, advertising jingles)

v  Dramatic works (plays, musicals, operas)

v  Pantomimes and choreographic works (ballets, other choreographed dance works, mime works)

v  Pictorial, graphic and sculptural works (photographs, maps, paintings, stuffed animals, graphic art, cartoon strips)

v  Motion pictures and other audiovisual works (movies, computer games, films, television shows, interactive multimedia)

v  Sound recordings (music, sounds, lyrics)

v  Architectural works (building design embodied in plans, or building itself, includes overall form, as well as arrangement of spaces and elements)

COPYRIGHTABLE SUBJECT MATTER

REQUIREMENTS FOR COPYRIGHT

Original  Work  of  Authorship  

Fixed  in  a  tangible  medium  

Copyrightable  

Exclusive Copyright Rights

Exclusive Rights to the Owner:

1. To reproduce the work 2. To prepare derivative works 3.  To distribute copies to the public 4.  To perform the work 5.  To display the work 6. To perform the work publicly by means of digital audio

transmission (e.g., sound recordings)

v  Ideas, concepts, principles, discoveries

v  Method of operations, procedures, processes (distinguished from explanation or description)

v  Useful articles

v  Facts (as opposed from an original expression of factual matter)

v  Titles, names, short phrases (e.g. “March Madness”)

COPYRIGHTABLE

COPYRIGHTABLE

COPYRIGHTABLE

COPYRIGHTABLE

COPYRIGHTABLE

v  Default Rule: Author is the Owner

v  Exception: “Works Made for Hire”

COPYRIGHT OWNERSHIP

COPYRIGHT OWNERSHIP

Work-Made-for-Hire Definition: 1.  a work prepared by an employee within the scope of his or her

employment or

2.  a work specially ordered or commissioned for use: •  as a contribution to a collective work, •  as a part of a motion picture or other audiovisual work, •  as a translation, •  as a supplementary work, •  as a compilation, •  as an instructional text, •  as a test, •  as answer material for a test, or •  as an atlas,

if the parties expressly agree in a written instrument signed by them that the work shall be considered a work made for hire.

Transfer of Copyright

A transfer of copyright ownership is not valid unless an instrument of conveyance is in writing and signed by the owner of the rights conveyed.

RULE: GET IT IN WRITING!

Copyrights—Fact or Myth?

Copyrights—Fact or Myth?

I paid for it, so I own the copyright.

X

Copyrights—Fact or Myth?

I can take just a little portion of the work.

Copyrights—Fact or Myth?

I don’t need a license because I’m going to alter the work.

Copyrights—Fact or Myth?

If I change at least 10% of the work, it’s not copyright infringement.

Copyrights—Fact or Myth?

If I give credit to the copyright owner, it’s not copyright infringement.

Limitations of Copyright Protection

Limitations of Copyright Protection

COPYRIGHT VS PATENT

v  Copyright – protects expression

v  Patent – protects inventive concepts & ideas

PATENTS

WHAT DO THESE COMPANIES HAVE IN COMMON?

THE WAR OVER SOFTWARE PATENTABILITY

THE WAR OVER SOFTWARE PATENTABILITY

THE WAR OVER SOFTWARE PATENTABILITY

EXCLUDED SUBJECT MATTER

WHY ARE PATENTS VALUABLE?

Ø  A patent prevent others from: •  making, •  using, and •  selling the patented invention

Ø  Term – 20 years from filing date of patent application

PATENT BASICS

Ø  A patentable invention is any process, machine, manufacture, or composition of matter that is:

§  Patentable subject matter §  Useful §  Adequately described §  New (novel) §  Non-obvious

Determined by the application

Determined by the prior art

PATENTABLE SUBJECT MATTER

Ø  Process Ø  Machine Ø  Manufacture Ø  Composition of matter

PATENTABLE SUBJECT MATTER

Ø  Process Ø  Machine Ø  Manufacture Ø  Composition of matter

EXCLUDED SUBJECT MATTER—LAWS OF NATURE

EXCLUDED SUBJECT MATTER-PHYSICAL PHENOMENA

EXCLUDED SUBJECT MATTER

Abstract ideas

CLS BANK V. ALICE CORP

CLS BANK V. ALICE CORP

The Patent Ø  Various method and system claims to a computerized

currency trading platform used by banks as a low-risk way to reconcile pending transactions, particularly across different time zones

CLS BANK V. ALICE CORP

The District Court Decision Ø  Summary judgment that the claims were directed to abstract

ideas and thus ineligible for patent protection under 35 U.S.C. §101

CLS BANK V. ALICE CORP

Questions before the Federal Circuit Ø  What is the test for determining if a computer-implemented

invention is a patent-ineligible abstract idea? Ø  When, if ever, can a computer in a claim lend patent

eligibility to an otherwise ineligible idea? Ø  Should it matter to patent eligibility that the computer

implemented invention is claimed as a method, system, or storage device?

Ø  Should such claims be considered equivalent for determining patent eligibility?

CLS BANK V. ALICE CORP.

Method   Media   System  

1   Lourie   Not  Eligible   Not  Eligible   Not  Eligible  

2   Dyk   Not  Eligible   Not  Eligible   Not  Eligible  

3   Prost   Not  Eligible   Not  Eligible   Not  Eligible  

4   Reyna   Not  Eligible   Not  Eligible   Not  Eligible  

5   Wallach   Not  Eligible   Not  Eligible   Not  Eligible  

6   Rader   Not  Eligible   Not  Eligible   Eligible  

7   Linn   Eligible   Eligible   Eligible  

8   Moore   Not  Eligible   Not  Eligible   Eligible  

9   O’Malley   Eligible   Eligible   Eligible  

10   Newman   Eligible   Eligible   Eligible  

PATENT ELIGIBILITY: BEST PRACTICES

Software qualifies for patent protection when: Ø  does not preempt an abstract idea Ø  involves a human contribution that adds additional

limitations narrowing the claims to cover significantly less than the full abstract idea

PATENT BASICS

Ø  A patentable invention is any process, machine, manufacture, or composition of matter that is:

§  Patentable subject matter §  Useful §  Adequately described §  New (novel) §  Non-obvious

Determined by the application

Determined by the prior art

DESCRIPTION REQUIREMENTS

Ø  Application must describe invention and manner of making and using it

Ø  Description must be sufficiently specific and clear that it enables a programmer to make and use it

DESCRIPTION REQUIREMENTS & SOFTWARE

Software patent should describe: Ø  software details Ø  algorithms Ø  software module to execute each step Ø  data passed between modules Ø  flowcharts Ø  hardware

DESCRIPTION REQUIREMENTS & SOFTWARE

Ø  Not necessary to include code

Ø  Description should enable a programmer to write code

DESCRIPTION REQUIREMENTS & TIMING

v  Important to file as early as possible, but not at expense of filing with an inadequate disclosure

v  Once filed, no new matter may be added

PATENT BASICS

v  A patentable invention is any process, machine, manufacture, or composition of matter that is:

§  Patentable subject matter §  Useful §  Adequately described §  New (novel) §  Non-obvious

Determined by the application

Determined by the prior art

NOVELTY

Patent not allowed if, before your filing date, your invention was: Ø  patented Ø  described in a publication Ø  in public use, on sale, or otherwise available Exceptions: Disclosures made 1 year or less before your filing date are not prior art if: Ø  your disclosure Ø  disclosure was after your public disclosure

NOVELTY

Patent not allowed if, before your filing date, your invention was: Ø  described in a patent application naming another inventor that

has an earlier filing date Unless: Ø  the other inventor’s application is not published and no patent

issues from it Ø  information was obtained from you Ø  you publicly disclosed the same information before the other

inventor’s application was filed Ø  your invention and the disclosed information were owned by the

same person not later than your filing date

TIMING

Ø  U.S. Grace Period: In the United States, a patent application can still be filed within 1 year of your: §  first publication §  first offer for sale, or §  first public use of the invention

Ø  In most foreign countries, public

disclosure=forfeiture of patent rights

EVENTS TRIGGERING ONE-YEAR CLOCK

Ø  Beta tests

Ø  Demonstrations

Ø  Web sites

Ø  Internal use for commercial purpose

PATENT BASICS

Ø  A patentable invention is any process, machine, manufacture, or composition of matter that is:

§  Patentable subject matter §  Useful §  Adequately described §  New (novel) §  Non-obvious

Determined by the application

Determined by the prior art

NON-OBVIOUSNESS

Patent not allowed if: Ø  claimed invention would have been obvious to a

skilled artisan before the effective filing date

KEY POINTS - COPYRIGHT

Ø Copyright protects expression of an idea, not the idea itself.

Ø Transfer of copyright ownership must be in writing.

KEY POINTS - PATENT

Ø Patent law is unsettled on issue of whether software qualifies for patent protection.

Ø Not necessary to include code in a software patent application, but the application should enable a programmer to write the code.

Ø Patent application should be filed before public disclosure of the invention.

Questions?

“Legally Protecting Software: Benefits, Pitfalls and Misconceptions” Presented by: Michael Leachman(mleachman@joneswalker.com) Blair Suire(bsuire@joneswalker.com) Jones Walker LLP