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2 Major Patent Rulings from the US Supreme Court - KSR and Microsoft v. AT&T
Monday, April 30 2007 @ 12:10 PM EDT

There are two major patent decisions from the US Supreme Court today, and here they are, both PDFs:
We can read them together, but it looks from media coverage like the patent world as we know it has just changed. For the better.

Update: Here's the transcript [PDF] of oral argument in the Microsoft case, and here's the transcript [PDF] for KSR. You can now also read the ruling in KSR in HTML on Google Scholar and the Microsoft decision on Cornell University School of Law's Legal Information Institute's site, as well as below, on Groklaw.

Here are some news stories for context from Bloomberg. A bit more from Reuters and Law.com:

Steve Maebius of Foley & Lardner said the wording of the decision suggests the high court "wanted to avoid a radical upsetting of the apple cart." But the decision will have a "really broad impact," because in the trade-off between flexibility and predictability, "the Court chose flexibility."

The new case-by-case approach "could increase litigation and the cost of obtaining a patent in the first place," Maebius says, because patent examiners will now feel freer to reject patent applications on obviousness grounds.

Rachel Krevans of Morrison & Foerster said in a statement, "The new test for obviousness, which will apply to challenges to patent validity regardless of whether the patent was issued before or after the KSR decision, may also impair the value of previously issued U.S. patents, because it makes it easier to challenge them in litigation, and to ask the patent office to reconsider the decision to issue the patent."

You may recall that the Software Freedom Law Center filed an amicus brief with the court in support of Microsoft in the Microsoft v. AT&T case, so I'm very excited to read the decision. Dennis Crouch of Patently-O explained a bit about the AT&T patent back in 2005. His headline today is: Supreme Court Retracts Patent Protection:

KSR v. Teleflex, 550 U. S. ____ (2007): In a unanimous opinion authored by Justice Kennedy, the Supreme Court held that the Federal Circuit's "narrow" & "rigid" TSM test is not the proper application of the nonobviousness doctrine of Section 103(a) of the Patent Act.

The Microsoft decision was 7-1, with Justice Stevens dissenting. And here's the page, for your bookmarks, where you can always get the most recent Supreme Court decisions. We have it on Groklaw's permanent Legal Research page, if you prefer.

Update: We have both decisions as text now. First, the KSR and then the Microsoft decisions. I've placed a double row of stars to mark the end of KSR. My thanks to Groklaw member Mad Scientist for doing the OCR so quickly. Keep in mind that this is not an official text. It is my effort to make the decisions available quickly for keyword searching and so those who depend on readers can follow along easily. For anything official, you will have to go by the PDFs from the court.

In KSR Int'l Co. v. Teleflex Inc., the standout paragraph to me is this one:

We build and create by bringing to the tangible and palpable reality around us new works based on instinct, simple logic, ordinary inferences, extraordinary ideas, and sometimes even genius. These advances, once part of our shared knowledge, define a new threshold from which innovation starts once more. And as progress beginning from higher levels of achievement is expected in the normal course, the results of ordinary innovation are not the subject of exclusive rights under the patent laws. Were it otherwise patents might stifle, rather than promote, the progress of useful arts. See U. S. Const., Art. I, §8, cl. 8. These premises led to the bar on patents claiming obvious subject matter established in Hotchkiss and codified in §103. Application of the bar must not be confined within a test or formulation too constrained to serve its purpose.

The court has raised the obviousness bar, or as they probably view it put it back where the founding fathers meant it to be. That greatly increases the value, in my opinion, of the Peer to Patent Project, and I can't wait to go obviousness hunting. I also hope Novell and anyone else who signed a patent agreement with Microsoft over Linux is kicking themselves now. Do you remember the recent statement by the EU Commission, that they examined Microsoft's claimed patents in that antitrust matter, and found them not so very innovative?

In acknowledging the work of its designated trustee, Dr. Neil Barrett, the EU said it examined 160 Microsoft claims to patented technologies, and concluded that among those, only four may only deserve to claim "a limited degree of innovation."

Yes, sir. I see potential here.

In the Microsoft decision, I find two points particularly of interest: In the majority opinion, this footnote catches my eye:

13 We need not address whether software in the abstract, or any other intangible, can ever be a component under §271(f). If an intangible method or process, for instance, qualifies as a “patented invention” under §271(f) (a question as to which we express no opinion), the combinable components of that invention might be intangible as well. The invention before us, however, AT&T’s speech-processing computer, is a tangible thing.

If you read Justice Stevens' dissent, you will perhaps agree with me that the footnote indicates progress. Secondly, in Justice Alito's concurring opinion (except for footnote 14), in which he was joined by Justices Thomas and Breyer, he wrote something that I noted:

I agree with the Court that a component of a machine, whether a shrimp deveiner or a personal computer, must be something physical.... I agree with the Court that a set of instructions on how to build an infringing device, or even a template of the device, does not qualify as a component....To be sure, if these computers could not run Windows without inserting and keeping a CD-ROM in the appropriate drive, then the CD-ROMs might be components of the computer. But that is not the case here.

Naturally, I think of Knoppix and other live CDs.

Any errors in our text version are mine, although I have aimed for accuracy, so if you note any errors, tell me, not the court. The changes I made here are for the blind and those dependent on readers -- I have put footnotes at the end of each section in Microsoft instead of at the bottom of each page. And because computers are not as smart as people, I had to make Justice Stevens' dissenting opinion's one footnote a double **, because an earlier concurring decision by Justice Alito already used up the single. There is one typo in KSR and I did fix that. Those are the only changes I made on purpose, but if you see others that were inadvertent, please let me know:

**********************************************************************

Cite as: 550 U.S. ____ (2007)

Opinion of the Court

NOTICE: This opinion is subject to formal revision before publication in the preliminary part of the United States Reports. Readers are requested to notify the Reporter of Decisions, Supreme Court of the United States, Washington, D.C. 20543, of any typographical or other formal errors, in order that corrections may be made before the preliminary print goes to press.

SUPREME COURT OF THE UNITED STATES

No. 04-1350

KSR INTERNATIONAL CO., PETITIONER v.
TELEFLEX INC. Et Al.

ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE FEDERAL CIRCUIT

[April 30, 2007]

JUSTICE KENNEDY delivered the opinion of the Court.

Teleflex Incorporated and its subsidiary Technology Holding Company -- both referred to here as Teleflex -- sued KSR International Company for patent infringement. The patent at issue, United States Patent No. 6,237,565B1, is entitled “Adjustable Pedal Assembly With Electronic Throttle Control.” Supplemental App. 1. The patentee is Steven J. Engelgau, and the patent is referred to as “the Engelgau patent.” Teleflex holds the exclusive license to the patent.

Claim 4 of the Engelgau patent describes a mechanism for combining an electronic sensor with an adjustable automobile pedal so the pedal’s position can be transmitted to a computer that controls the throttle in the vehicle’s engine. When Teleflex accused KSR of infringing the Engelgau patent by adding an electronic sensor to one of KSR’s previously designed pedals, KSR countered that claim 4 was invalid under the Patent Act, 35 U. S. C. §103, because its subject matter was obvious.

Section 103 forbids issuance of a patent when “the differences between the subject matter sought to be pat-

ented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains.”

In Graham v. John Deere Co. of Kansas City, 383 U. S. 1 (1966), the Court set out a framework for applying the statutory language of §103, language itself based on the logic of the earlier decision in Hotchkiss v. Greenwood, 11 How. 248 (1851), and its progeny. See 383 U. S., at 15–17. The analysis is objective:

“Under §103, the scope and content of the prior art are to be determined; differences between the prior art and the claims at issue are to be ascertained; and the level of ordinary skill in the pertinent art resolved. Against this background the obviousness or nonobviousness of the subject matter is determined. Such secondary considerations as commercial success, long felt but unsolved needs, failure of others, etc., might be utilized to give light to the circumstances surrounding the origin of the subject matter sought to be patented.” Id., at 17–18.

While the sequence of these questions might be reordered in any particular case, the factors continue to define the inquiry that controls. If a court, or patent examiner, conducts this analysis and concludes the claimed subject matter was obvious, the claim is invalid under §103.

Seeking to resolve the question of obviousness with more uniformity and consistency, the Court of Appeals for the Federal Circuit has employed an approach referred to by the parties as the “teaching, suggestion, or motivation” test (TSM test), under which a patent claim is only proved obvious if “some motivation or suggestion to combine the prior art teachings” can be found in the prior art, the nature of the problem, or the knowledge of a person having ordinary skill in the art. See, e.g., Al-Site Corp. v. VSI

Int’l, Inc., 174 F. 3d 1308, 1323–1324 (CA Fed. 1999). KSR challenges that test, or at least its application in this case. See 119 Fed. Appx. 282, 286–290 (CA Fed. 2005). Because the Court of Appeals addressed the question of obviousness in a manner contrary to §103 and our precedents, we granted certiorari, 547 U. S ___ (2006). We now reverse.

I
A

In car engines without computer-controlled throttles,the accelerator pedal interacts with the throttle via cable or other mechanical link. The pedal arm acts as a lever rotating around a pivot point. In a cable-actuated throttle control the rotation caused by pushing down the pedal pulls a cable, which in turn pulls open valves in the carburetor or fuel injection unit. The wider the valves open, the more fuel and air are released, causing combustion to increase and the car to accelerate. When the driver takes his foot off the pedal, the opposite occurs as the cable is released and the valves slide closed.

In the 1990’s it became more common to install computers in cars to control engine operation. Computer-controlled throttles open and close valves in response to electronic signals, not through force transferred from the pedal by a mechanical link. Constant, delicate adjustments of air and fuel mixture are possible. The computer’s rapid processing of factors beyond the pedal’s position improves fuel efficiency and engine performance.

For a computer-controlled throttle to respond to a driver’s operation of the car, the computer must know what is happening with the pedal. A cable or mechanical link does not suffice for this purpose; at some point, an electronic sensor is necessary to translate the mechanical operation into digital data the computer can understand.

Before discussing sensors further we turn to the me-

chanical design of the pedal itself. In the traditional design a pedal can be pushed down or released but cannot have its position in the footwell adjusted by sliding the pedal forward or back. As a result, a driver who wishes to be closer or farther from the pedal must either reposition himself in the driver’s seat or move the seat in some way. In cars with deep footwells these are imperfect solutions for drivers of smaller stature. To solve the problem, inventors, beginning in the 1970’s, designed pedals that could be adjusted to change their location in the footwell. Important for this case are two adjustable pedals disclosed in U. S. Patent Nos. 5,010,782 (filed July 28, 1989) (Asano) and 5,460,061 (filed Sept. 17, 1993) (Redding). The Asano patent reveals a support structure that houses the pedal so that even when the pedal location is adjusted relative to the driver, one of the pedal’s pivot points stays fixed. The pedal is also designed so that the force necessary to push the pedal down is the same regardless of adjustments to its location. The Redding patent reveals a different, sliding mechanism where both the pedal and the pivot point are adjusted.

We return to sensors. Well before Engelgau applied for his challenged patent, some inventors had obtained patents involving electronic pedal sensors for computer-controlled throttles. These inventions, such as the device disclosed in U. S. Patent No. 5,241,936 (filed Sept. 9, 1991) (’936), taught that it was preferable to detect the pedal’s position in the pedal assembly, not in the engine. The ’936 patent disclosed a pedal with an electronic sensor on a pivot point in the pedal assembly. U. S. Patent No. 5,063,811 (filed July 9, 1990) (Smith) taught that to prevent the wires connecting the sensor to the computer from chafing and wearing out, and to avoid grime and damage from the driver’s foot, the sensor should be put on a fixed part of the pedal assembly rather than in or on the pedal’s footpad.

In addition to patents for pedals with integrated sensors inventors obtained patents for self-contained modular sensors. A modular sensor is designed independently of a given pedal so that it can be taken off the shelf and attached to mechanical pedals of various sorts, enabling the pedals to be used in automobiles with computer-controlled throttles. One such sensor was disclosed in U. S. Patent No. 5,385,068 (filed Dec. 18, 1992) (’068). In 1994, Chevrolet manufactured a line of trucks using modular sensors “attached to the pedal support bracket, adjacent to the pedal and engaged with the pivot shaft about which the pedal rotates in operation.” 298 F. Supp. 2d 581, 589 (ED Mich. 2003).

The prior art contained patents involving the placement of sensors on adjustable pedals as well. For example, U. S. Patent No. 5,819,593 (filed Aug. 17, 1995) (Rixon) discloses an adjustable pedal assembly with an electronic sensor for detecting the pedal’s position. In the Rixon pedal the sensor is located in the pedal footpad. The Rixon pedal was known to suffer from wire chafing when the pedal was depressed and released.

This short account of pedal and sensor technology leads to the instant case.

B

KSR, a Canadian company, manufactures and supplies auto parts, including pedal systems. Ford Motor Company hired KSR in 1998 to supply an adjustable pedal system for various lines of automobiles with cable-actuated throttle controls. KSR developed an adjustable mechanical pedal for Ford and obtained U. S. Patent No. 6,151,976 (filed July 16, 1999) (’976) for the design. In 2000, KSR was chosen by General Motors Corporation (GMC or GM)to supply adjustable pedal systems for Chevrolet and GMC light trucks that used engines with computer-controlled throttles. To make the ’976 pedal compatible with the

trucks, KSR merely took that design and added a modular sensor.

Teleflex is a rival to KSR in the design and manufacture of adjustable pedals. As noted, it is the exclusive licensee of the Engelgau patent. Engelgau filed the patent application on August 22, 2000 as a continuation of a previous application for U. S. Patent No. 6,109,241, which was filed on January 26, 1999. He has sworn he invented the patent’s subject matter on February 14, 1998. The Engelgau patent discloses an adjustable electronic pedal described in the specification as a “simplified vehicle control pedal assembly that is less expensive, and which uses fewer parts and is easier to package within the vehicle.” Engelgau, col. 2, lines 2–5, Supplemental App. 6. Claim 4 of the patent, at issue here, describes:

“A vehicle control pedal apparatus comprising:

a support adapted to be mounted to a vehicle structure; an adjustable pedal assembly having a pedal arm moveable in for[e] and aft directions with respect to said support;

a pivot for pivotally supporting said adjustable pedal assembly with respect to said support and defining a pivot axis;

and an electronic control attached to said support for controlling a vehicle system;

said apparatus characterized by said electronic control being responsive to said pivot for providing a signal that corresponds to pedal arm position as said pedal arm pivots about said pivot axis between rest and applied positions wherein the position of said pivot remains constant while said pedal arm moves in fore and aft directions with respect to said pivot.” Id., col.

6, lines 17–36, Supplemental App. 8 (diagram numbers omitted).

We agree with the District Court that the claim discloses “a position-adjustable pedal assembly with an electronic pedal position sensor attached to the support member of the pedal assembly. Attaching the sensor to the support member allows the sensor to remain in a fixed position while the driver adjusts the pedal.” 298 F. Supp. 2d, at 586–587.

Before issuing the Engelgau patent the U. S. Patent and Trademark Office (PTO) rejected one of the patent claims that was similar to, but broader than, the present claim 4. The claim did not include the requirement that the sensor be placed on a fixed pivot point. The PTO concluded the claim was an obvious combination of the prior art disclosed in Redding and Smith, explaining:

“‘Since the prior ar[t] references are from the field of endeavor, the purpose disclosed . . . would have been recognized in the pertinent art of Redding. Therefore it would have been obvious . . . to provide the device of Redding with the . . . means attached to a support member as taught by Smith.’” Id., at 595.

In other words Redding provided an example of an adjustable pedal and Smith explained how to mount a sensor on a pedal’s support structure, and the rejected patent claim merely put these two teachings together.

Although the broader claim was rejected, claim 4 was later allowed because it included the limitation of a fixed pivot point, which distinguished the design from Redding’s. Ibid. Engelgau had not included Asano among the prior art references, and Asano was not mentioned in the patent’s prosecution. Thus, the PTO did not have before it an adjustable pedal with a fixed pivot point. The patent issued on May 29, 2001 and was assigned to Teleflex.

Upon learning of KSR’s design for GM, Teleflex sent a

warning letter informing KSR that its proposal would violate the Engelgau patent. “‘Teleflex believes that any supplier of a product that combines an adjustable pedal with an electronic throttle control necessarily employs technology covered by one or more’” of Teleflex’s patents. Id., at 585. KSR refused to enter a royalty arrangement with Teleflex; so Teleflex sued for infringement, asserting KSR’s pedal infringed the Engelgau patent and two other patents. Ibid. Teleflex later abandoned its claims regarding the other patents and dedicated the patents to the public. The remaining contention was that KSR’s pedal system for GM infringed claim 4 of the Engelgau patent. Teleflex has not argued that the other three claims of the patent are infringed by KSR’s pedal, nor has Teleflex argued that the mechanical adjustable pedal designed by KSR for Ford infringed any of its patents.

C

The District Court granted summary judgment in KSR’s favor. After reviewing the pertinent history of pedal design, the scope of the Engelgau patent, and the relevant prior art, the court considered the validity of the contested claim. By direction of 35 U. S. C. §282, an issued patent is presumed valid. The District Court applied Graham’s framework to determine whether under summary-judgment standards KSR had overcome the presumption and demonstrated that claim 4 was obvious in light of the prior art in existence when the claimed subject matter was invented. See §102(a).

The District Court determined, in light of the expert testimony and the parties’ stipulations, that the level of ordinary skill in pedal design was “‘an undergraduate degree in mechanical engineering (or an equivalent amount of industry experience) [and] familiarity with pedal control systems for vehicles.’” 298 F. Supp. 2d, at 590. The court then set forth the relevant prior art, in-

cluding the patents and pedal designs described above.

Following Graham’s direction, the court compared the teachings of the prior art to the claims of Engelgau. It found “little difference.” 298 F. Supp. 2d, at 590. Asano taught everything contained in claim 4 except the use of a sensor to detect the pedal’s position and transmit it to the computer controlling the throttle. That additional aspect was revealed in sources such as the ’068 patent and the sensors used by Chevrolet.

Under the controlling cases from the Court of Appeals for the Federal Circuit, however, the District Court was not permitted to stop there. The court was required also to apply the TSM test. The District Court held KSR had satisfied the test. It reasoned (1) the state of the industry would lead inevitably to combinations of electronic sensors and adjustable pedals, (2) Rixon provided the basis for these developments, and (3) Smith taught a solution to the wire chafing problems in Rixon, namely locating the sensor on the fixed structure of the pedal. This could lead to the combination of Asano, or a pedal like it, with a pedal position sensor.

The conclusion that the Engelgau design was obvious was supported, in the District Court’s view, by the PTO’s rejection of the broader version of claim 4. Had Engelgau included Asano in his patent application, it reasoned, the PTO would have found claim 4 to be an obvious combination of Asano and Smith, as it had found the broader version an obvious combination of Redding and Smith. As a final matter, the District Court held that the secondary factor of Teleflex’s commercial success with pedals based on Engelgau’s design did not alter its conclusion. The District Court granted summary judgment for KSR.

With principal reliance on the TSM test, the Court of Appeals reversed. It ruled the District Court had not been strict enough in applying the test, having failed to make“‘finding[s] as to the specific understanding or principle

within the knowledge of a skilled artisan that would have motivated one with no knowledge of [the] invention’ . . . to attach an electronic control to the support bracket of the Asano assembly.” 119 Fed. Appx., at 288 (brackets in original) (quoting In re Kotzab, 217 F. 3d 1365, 1371 (CA Fed. 2000)). The Court of Appeals held that the District Court was incorrect that the nature of the problem to be solved satisfied this requirement because unless the “prior art references address[ed] the precise problem that the patentee was trying to solve,” the problem would not motivate an inventor to look at those references. 119 Fed. Appx., at 288.

Here, the Court of Appeals found, the Asano pedal was designed to solve the “‘constant ratio problem’” -- that is, to ensure that the force required to depress the pedal is the same no matter how the pedal is adjusted -- whereas Engelgau sought to provide a simpler, smaller, cheaper adjustable electronic pedal. Ibid. As for Rixon, the court explained, that pedal suffered from the problem of wire chafing but was not designed to solve it. In the court’s view Rixon did not teach anything helpful to Engelgau’s purpose. Smith, in turn, did not relate to adjustable pedals and did not “necessarily go to the issue of motivation to attach the electronic control on the support bracket of the pedal assembly.” Ibid. When the patents were interpreted in this way, the Court of Appeals held, they would not have led a person of ordinary skill to put a sensor on the sort of pedal described in Asano.

That it might have been obvious to try the combination of Asano and a sensor was likewise irrelevant, in the court’s view, because “‘“[o]bvious to try” has long been held not to constitute obviousness.’” Id., at 289 (quoting In re Deuel, 51 F. 3d 1552, 1559 (CA Fed. 1995)).

The Court of Appeals also faulted the District Court’s consideration of the PTO’s rejection of the broader version of claim 4. The District Court’s role, the Court of Appeals

explained, was not to speculate regarding what the PTO might have done had the Engelgau patent mentioned Asano. Rather, the court held, the District Court was obliged first to presume that the issued patent was valid and then to render its own independent judgment of obviousness based on a review of the prior art. The fact that the PTO had rejected the broader version of claim 4, the Court of Appeals said, had no place in that analysis.

The Court of Appeals further held that genuine issues of material fact precluded summary judgment. Teleflex had proffered statements from one expert that claim 4 “‘was a simple, elegant, and novel combination of features,’” 119 Fed. Appx., at 290, compared to Rixon, and from another expert that claim 4 was non obvious because, unlike in Rixon, the sensor was mounted on the support bracket rather than the pedal itself. This evidence, the court concluded, sufficed to require a trial.

II
A

We begin by rejecting the rigid approach of the Court of Appeals. Throughout this Court’s engagement with the question of obviousness, our cases have set forth an expansive and flexible approach inconsistent with the way the Court of Appeals applied its TSM test here. To be sure, Graham recognized the need for “uniformity and definiteness.” 383 U. S., at 18. Yet the principles laid down in Graham reaffirmed the “functional approach” of Hotchkiss, 11 How. 248. See 383 U. S., at 12. To this end, Graham set forth a broad inquiry and invited courts, where appropriate, to look at any secondary considerations that would prove instructive. Id., at 17.

Neither the enactment of §103 nor the analysis in Graham disturbed this Court’s earlier instructions concerning the need for caution in granting a patent based on the combination of elements found in the prior art. For over a

half century, the Court has held that a “patent for a combination which only unites old elements with no change in their respective functions . . . obviously withdraws what is already known into the field of its monopoly and diminishes the resources available to skillful men.” Great Atlantic & Pacific Tea Co. v. Supermarket Equipment Corp., 340 U. S. 147, 152 (1950). This is a principal reason for declining to allow patents for what is obvious. The combination of familiar elements according to known methods is likely to be obvious when it does no more than yield predictable results. Three cases decided after Graham illustrate the application of this doctrine.

In United States v. Adams, 383 U. S. 39, 40 (1966), a companion case to Graham, the Court considered the obviousness of a “wet battery” that varied from prior designs in two ways: It contained water, rather than the acids conventionally employed in storage batteries; and its electrodes were magnesium and cuprous chloride, rather than zinc and silver chloride. The Court recognized that when a patent claims a structure already known in the prior art that is altered by the mere substitution of one element for another known in the field, the combination must do more than yield a predictable result. 383 U. S., at 50–51. It nevertheless rejected the Government’s claim that Adams’s battery was obvious. The Court relied upon the corollary principle that when the prior art teaches away from combining certain known elements, discovery of a successful means of combining them is more likely to be nonobvious. Id., at 51–52. When Adams designed his battery, the prior art warned that risks were involved in using the types of electrodes he employed. The fact that the elements worked together in an unexpected and fruitful manner supported the conclusion that Adams’s design was not obvious to those skilled in the art.

In Anderson’s-Black Rock, Inc. v. Pavement Salvage Co., 396 U. S. 57 (1969), the Court elaborated on this approach.

The subject matter of the patent before the Court was a device combining two pre-existing elements: a radiant-heat burner and a paving machine. The device, the Court concluded, did not create some new synergy: The radiant-heat burner functioned just as a burner was expected to function; and the paving machine did the same. The two in combination did no more than they would in separate, sequential operation. Id., at 60–62. In those circumstances, “while the combination of old elements performed a useful function, it added nothing to the nature and quality of the radiant-heat burner already patented,” and the patent failed under §103. Id., at 62 (footnote omitted).

Finally, in Sakraida v. AG Pro, Inc., 425 U. S. 273 (1976), the Court derived from the precedents the conclusion that when a patent “simply arranges old elements with each performing the same function it had been known to perform” and yields no more than one would expect from such an arrangement, the combination is obvious. Id., at 282.

The principles underlying these cases are instructive when the question is whether a patent claiming the combination of elements of prior art is obvious. When a work is available in one field of endeavor, design incentives and other market forces can prompt variations of it, either in the same field or a different one. If a person of ordinary skill can implement a predictable variation, §103 likely bars its patentability. For the same reason, if a technique has been used to improve one device, and a person of ordinary skill in the art would recognize that it would improve similar devices in the same way, using the technique is obvious unless its actual application is beyond his or her skill. Sakraida and Anderson’s-Black Rock are illustrative -- a court must ask whether the improvement is more than the predictable use of prior art elements according to their established functions.

Following these principles may be more difficult in other

cases than it is here because the claimed subject matter may involve more than the simple substitution of one known element for another or the mere application of a known technique to a piece of prior art ready for the improvement. Often, it will be necessary for a court to look to interrelated teachings of multiple patents; the effects of demands known to the design community or present in the market place; and the background knowledge possessed by a person having ordinary skill in the art, all in order to determine whether there was an apparent reason to combine the known elements in the fashion claimed by the patent at issue. To facilitate review, this analysis should be made explicit. See In re Kahn, 441 F. 3d 977, 988 (CA Fed. 2006) (“[R]ejections on obviousness grounds cannot be sustained by mere conclusory statements; instead, there must be some articulated reasoning with some rational underpinning to support the legal conclusion of obviousness”). As our precedents make clear, however, the analysis need not seek out precise teachings directed to the specific subject matter of the challenged claim, for a court can take account of the inferences and creative steps that a person of ordinary skill in the art would employ.

B

When it first established the requirement of demonstrating a teaching, suggestion, or motivation to combine known elements in order to show that the combination is obvious, the Court of Customs and Patent Appeals captured a helpful insight. See Application of Bergel, 292 F. 2d 955, 956–957 (1961). As is clear from cases such as Adams, a patent composed of several elements is not proved obvious merely by demonstrating that each of its elements was, independently, known in the prior art. Although common sense directs one to look with care at a patent application that claims as innovation the combination of two known devices according to their established functions, it can be important to identify a reason that would have prompted a person of ordinary skill in the relevant field to combine the elements in the way the claimed new invention does. This is so because inventions in most, if not all, instances rely upon building blocks long since uncovered, and claimed discoveries almost of necessity will be combinations of what, in some sense, is already known.

Helpful insights, however, need not become rigid and mandatory formulas; and when it is so applied, the TSM test is incompatible with our precedents. The obviousness analysis cannot be confined by a formalistic conception of the words teaching, suggestion, and motivation, or by overemphasis on the importance of published articles and the explicit content of issued patents. The diversity of inventive pursuits and of modern technology counsels against limiting the analysis in this way. In many fields it may be that there is little discussion of obvious techniques or combinations, and it often may be the case that market demand, rather than scientific literature, will drive design trends. Granting patent protection to advances that would occur in the ordinary course without real innovation retards progress and may, in the case of patents combining previously known elements, deprive prior inventions of their value or utility.

In the years since the Court of Customs and Patent Appeals set forth the essence of the TSM test, the Court of Appeals no doubt has applied the test in accord with these principles in many cases. There is no necessary inconsistency between the idea underlying the TSM test and the Graham analysis. But when a court transforms the general principle into a rigid rule that limits the obviousness inquiry, as the Court of Appeals did here, it errs.

C

The flaws in the analysis of the Court of Appeals relate

for the most part to the court’s narrow conception of the obviousness inquiry reflected in its application of the TSM test. In determining whether the subject matter of a patent claim is obvious, neither the particular motivation nor the avowed purpose of the patentee controls. What matters is the objective reach of the claim. If the claim extends to what is obvious, it is invalid under §103. One of the ways in which a patent’s subject matter can be proved obvious is by noting that there existed at the time of invention a known problem for which there was an obvious solution encompassed by the patent’s claims.

The first error of the Court of Appeals in this case was to foreclose this reasoning by holding that courts and patent examiners should look only to the problem the patentee was trying to solve. 119 Fed. Appx., at 288. The Court of Appeals failed to recognize that the problem motivating the patentee may be only one of many addressed by the patent’s subject matter. The question is not whether the combination was obvious to the patentee but whether the combination was obvious to a person with ordinary skill in the art. Under the correct analysis, any need or problem known in the field of endeavor at the time of invention and addressed by the patent can provide a reason for combining the elements in the manner claimed.

The second error of the Court of Appeals lay in its assumption that a person of ordinary skill attempting to solve a problem will be led only to those elements of prior art designed to solve the same problem. Ibid. The primary purpose of Asano was solving the constant ratio problem; so, the court concluded, an inventor considering how to put a sensor on an adjustable pedal would have no reason to consider putting it on the Asano pedal. Ibid. Common sense teaches, however, that familiar items may have obvious uses beyond their primary purposes, and in many cases a person of ordinary skill will be able to fit the teachings of multiple patents together like pieces of a

puzzle. Regardless of Asano’s primary purpose, the design provided an obvious example of an adjustable pedal with a fixed pivot point; and the prior art was replete with patents indicating that a fixed pivot point was an ideal mount for a sensor. The idea that a designer hoping to make an adjustable electronic pedal would ignore Asano because Asano was designed to solve the constant ratio problem makes little sense. A person of ordinary skill is also a person of ordinary creativity, not an automaton.

The same constricted analysis led the Court of Appeals to conclude, in error, that a patent claim cannot be proved obvious merely by showing that the combination of elements was “obvious to try.” Id., at 289 (internal quotation marks omitted). When there is a design need or market pressure to solve a problem and there are a finite number of identified, predictable solutions, a person of ordinary skill has good reason to pursue the known options within his or her technical grasp. If this leads to the anticipated success, it is likely the product not of innovation but of ordinary skill and common sense. In that instance the fact that a combination was obvious to try might show that it was obvious under §103.

The Court of Appeals, finally, drew the wrong conclusion from the risk of courts and patent examiners falling prey to hindsight bias. A factfinder should be aware, of course, of the distortion caused by hindsight bias and must be cautious of arguments reliant upon ex post reasoning. See Graham, 383 U. S., at 36 (warning against a “temptation to read into the prior art the teachings of the invention in issue” and instructing courts to “‘guard against slipping into the use of hindsight’” (quoting Monroe Auto Equipment Co. v. Heckethorn Mfg. & Supply Co., 332 F. 2d 406, 412 (CA6 1964))). Rigid preventative rules that deny factfinders recourse to common sense, however, are neither necessary under our case law nor consistent with it.

We note the Court of Appeals has since elaborated a

q broader conception of the TSM test than was applied in the instant matter. See, e.g., DyStar Textilfarben GmbH & Co. Deutschland KG v. C. H. Patrick Co., 464 F. 3d 1356, 1367 (2006) (“Our suggestion test is in actuality quite flexible and not only permits, but requires, consideration of common knowledge and common sense”); Alza Corp. v. Mylan Labs., Inc., 464 F. 3d 1286, 1291 (2006) (“There is flexibility in our obviousness jurisprudence because a motivation may be found implicitly in the prior art. We do not have a rigid test that requires an actual teaching to combine . . .”). Those decisions, of course, are not now before us and do not correct the errors of law made by the Court of Appeals in this case. The extent to which they may describe an analysis more consistent with our earlier precedents and our decision here is a matter for the Court of Appeals to consider in its future cases. What we hold is that the fundamental misunderstandings identified above led the Court of Appeals in this case to apply a test inconsistent with our patent law decisions.

III

When we apply the standards we have explained to the instant facts, claim 4 must be found obvious. We agree with and adopt the District Court’s recitation of the relevant prior art and its determination of the level of ordinary skill in the field. As did the District Court, we see little difference between the teachings of Asano and Smith and the adjustable electronic pedal disclosed in claim 4 of the Engelgau patent. A person having ordinary skill in the art could have combined Asano with a pedal position sensor in a fashion encompassed by claim 4, and would have seen the benefits of doing so.

A

Teleflex argues in passing that the Asano pedal cannot be combined with a sensor in the manner described by

claim 4 because of the design of Asano’s pivot mechanisms. See Brief for Respondents 48–49, and n. 17. Therefore, Teleflex reasons, even if adding a sensor to Asano was obvious, that does not establish that claim 4 encompasses obvious subject matter. This argument was not, however, raised before the District Court. There Teleflex was content to assert only that the problem motivating the invention claimed by the Engelgau patent would not lead to the solution of combining of Asano with a sensor. See Teleflex’s Response to KSR’s Motion for Summary Judgment of Invalidity in No. 02–74586 (ED Mich.), pp. 18–20, App. 144a–146a. It is also unclear whether the current argument was raised before the Court of Appeals, where Teleflex advanced the nonspecific, conclusory contention that combining Asano with a sensor would not satisfy the limitations of claim 4. See Brief for Plaintiffs-Appellants in No. 04–1152 (CA Fed.), pp. 42–44. Teleflex’s own expert declarations, moreover, do not support the point Teleflex now raises. See Declaration of Clark J. Radcliffe, Ph.D., Supplemental App. 204–207; Declaration of Timothy L. Andresen, id., at 208–210. The only statement in either declaration that might bear on the argument is found in the Radcliffe declaration:
“Asano . . . and Rixon . . . are complex mechanical linkage-based devices that are expensive to produce and assemble and difficult to package. It is exactly these difficulties with prior art designs that [Engelgau] resolves. The use of an adjustable pedal with a single pivot reflecting pedal position combined with an electronic control mounted between the support and the adjustment assembly at that pivot was a simple, elegant, and novel combination of features in the Engelgau ’565 patent.” Id., at 206, ¶16.

Read in the context of the declaration as a whole this is best interpreted to mean that Asano could not be used to

solve “[t]he problem addressed by Engelgau ’565[:] to provide a less expensive, more quickly assembled, and smaller package adjustable pedal assembly with electronic control.” Id., at 205, ¶10. The District Court found that combining Asano with a pivot-mounted pedal position sensor fell within the scope of claim 4. 298 F. Supp. 2d, at 592–593. Given the significance of that finding to the District Court’s judgment, it is apparent that Teleflex would have made clearer challenges to it if it intended to preserve this claim. In light of Teleflex’s failure to raise the argument in a clear fashion, and the silence of the Court of Appeals on the issue, we take the District Court’s conclusion on the point to be correct.

B

The District Court was correct to conclude that, as of the time Engelgau designed the subject matter in claim 4, it was obvious to a person of ordinary skill to combine Asano with a pivot-mounted pedal position sensor. There then existed a marketplace that created a strong incentive to convert mechanical pedals to electronic pedals, and the prior art taught a number of methods for achieving this advance. The Court of Appeals considered the issue too narrowly by, in effect, asking whether a pedal designer writing on a blank slate would have chosen both Asano and a modular sensor similar to the ones used in the Chevrolet truckline and disclosed in the ’068 patent. The District Court employed this narrow inquiry as well, though it reached the correct result nevertheless. The proper question to have asked was whether a pedal designer of ordinary skill, facing the wide range of needs created by developments in the field of endeavor, would have seen a benefit to upgrading Asano with a sensor.

In automotive design, as in many other fields, the interaction of multiple components means that changing one

component often requires the others to be modified as well. Technological developments made it clear that engines using computer-controlled throttles would become standard. As a result, designers might have decided to design new pedals from scratch; but they also would have had reason to make pre-existing pedals work with the new engines. Indeed, upgrading its own pre-existing model led KSR to design the pedal now accused of infringing the Engelgau patent.

For a designer starting with Asano, the question was where to attach the sensor. The consequent legal question, then, is whether a pedal designer of ordinary skill starting with Asano would have found it obvious to put the sensor on a fixed pivot point. The prior art discussed above leads us to the conclusion that attaching the sensor where both KSR and Engelgau put it would have been obvious to a person of ordinary skill.

The ’936 patent taught the utility of putting the sensor on the pedal device, not in the engine. Smith, in turn, explained to put the sensor not on the pedal’s footpad but instead on its support structure. And from the known wire-chafing problems of Rixon, and Smith’s teaching that “the pedal assemblies must not precipitate any motion in the connecting wires,” Smith, col. 1, lines 35–37, Supplemental App. 274, the designer would know to place the sensor on a nonmoving part of the pedal structure. The most obvious nonmoving point on the structure from which a sensor can easily detect the pedal’s position is a pivot point. The designer, accordingly, would follow Smith in mounting the sensor on a pivot, thereby designing an adjustable electronic pedal covered by claim 4.

Just as it was possible to begin with the objective to upgrade Asano to work with a computer-controlled throttle, so too was it possible to take an adjustable electronic pedal like Rixon and seek an improvement that would avoid the wire-chafing problem. Following similar steps to

those just explained, a designer would learn from Smith to avoid sensor movement and would come, thereby, to Asano because Asano disclosed an adjustable pedal with a fixed pivot.

Teleflex indirectly argues that the prior art taught away from attaching a sensor to Asano because Asano in its view is bulky, complex, and expensive. The only evidence Teleflex marshals in support of this argument, however, is the Radcliffe declaration, which merely indicates that Asano would not have solved Engelgau’s goal of making a small, simple, and inexpensive pedal. What the declaration does not indicate is that Asano was somehow so flawed that there was no reason to upgrade it, or pedals like it, to be compatible with modern engines. Indeed, Teleflex’s own declarations refute this conclusion. Dr. Radcliffe states that Rixon suffered from the same bulk and complexity as did Asano. See id., at 206. Teleflex’s other expert, however, explained that Rixon was itself designed by adding a sensor to a pre-existing mechanical pedal. See id., at 209. If Rixon’s base pedal was not too flawed to upgrade, then Dr. Radcliffe’s declaration does not show Asano was either. Teleflex may have made a plausible argument that Asano is inefficient as compared to Engelgau’s preferred embodiment, but to judge Asano against Engelgau would be to engage in the very hindsight bias Teleflex rightly urges must be avoided. Accordingly, Teleflex has not shown anything in the prior art that taught away from the use of Asano.

Like the District Court, finally, we conclude Teleflex has shown no secondary factors to dislodge the determination that claim 4 is obvious. Proper application of Graham and our other precedents to these facts therefore leads to the conclusion that claim 4 encompassed obvious subject matter. As a result, the claim fails to meet the requirement of §103.

We need not reach the question whether the failure to

disclose Asano during the prosecution of Engelgau voids the presumption of validity given to issued patents, for claim 4 is obvious despite the presumption. We nevertheless think it appropriate to note that the rationale underlying the presumption -- that the PTO, in its expertise, has approved the claim -- seems much diminished here.

IV

A separate ground the Court of Appeals gave for reversing the order for summary judgment was the existence of a dispute over an issue of material fact. We disagree with the Court of Appeals on this point as well. To the extent the court understood the Graham approach to exclude the possibility of summary judgment when an expert provides a conclusory affidavit addressing the question of obviousness, it misunderstood the role expert testimony plays in the analysis. In considering summary judgment on that question the district court can and should take into account expert testimony, which may resolve or keep open certain questions of fact. That is not the end of the issue, however. The ultimate judgment of obviousness is a legal determination. Graham, 383 U. S., at 17. Where, as here, the content of the prior art, the scope of the patent claim,and the level of ordinary skill in the art are not in material dispute, and the obviousness of the claim is apparent in light of these factors, summary judgment is appropriate. Nothing in the declarations proffered by Teleflex prevented the District Court from reaching the careful conclusions underlying its order for summary judgment in this case.

* * *

We build and create by bringing to the tangible and palpable reality around us new works based on instinct, simple logic, ordinary inferences, extraordinary ideas, and sometimes even genius. These advances, once part of our

shared knowledge, define a new threshold from which innovation starts once more. And as progress beginning from higher levels of achievement is expected in the normal course, the results of ordinary innovation are not the subject of exclusive rights under the patent laws. Were it otherwise patents might stifle, rather than promote, the progress of useful arts. See U. S. Const., Art. I, §8, cl. 8. These premises led to the bar on patents claiming obvious subject matter established in Hotchkiss and codified in §103. Application of the bar must not be confined within a test or formulation too constrained to serve its purpose.

KSR provided convincing evidence that mounting a modular sensor on a fixed pivot point of the Asano pedal was a design step well within the grasp of a person of ordinary skill in the relevant art. Its arguments, and the record, demonstrate that claim 4 of the Engelgau patent is obvious. In rejecting the District Court’s rulings, the Court of Appeals analyzed the issue in a narrow, rigid manner inconsistent with §103 and our precedents. The judgment of the Court of Appeals is reversed, and the case remanded for further proceedings consistent with this opinion.

It is so ordered.

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Cite as: 550 U.S. ____________(2007)

Opinion of the Court

NOTICE: This opinion is subject to formal revision before publication in the preliminary part of the United States Reports. Readers are requested to notify the Reporter of Decisions, Supreme Court of the United States, Washington, D.C. 20543, of any typographical or other formal errors, in order that corrections may be made before the preliminary print goes to press.

SUPREME COURT OF THE UNITED STATES

No. 05-1056

MICROSOFT CORPORATION, PETITIONER v.
AT&T CORP.

ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE FEDERAL CIRCUIT

[April 30, 2007]

JUSTICE GINSBURG delivered the opinion of the Court, except as to footnote 14.

It is the general rule under United States patent law that no infringement occurs when a patented product is made and sold in another country. There is an exception. Section 271(f) of the Patent Act, adopted in 1984, provides that infringement does occur when one “supplies . . . from the United States,” for “combination” abroad, a patented invention’s “components.” 35 U. S. C. §271(f)(1). This case concerns the applicability of §271(f) to computer software first sent from the United States to a foreign manufacturer on a master disk, or by electronic transmission, then copied by the foreign recipient for installation on computers made and sold abroad.

AT&T holds a patent on an apparatus for digitally encoding and compressing recorded speech. Microsoft’s Windows operating system, it is conceded, has the potential to infringe AT&T’s patent, because Windows incorporates software code that, when installed, enables a computer to process speech in the manner claimed by that patent. It bears emphasis, however, that uninstalled

Windows software does not infringe AT&T’s patent any more than a computer standing alone does; instead, the patent is infringed only when a computer is loaded with Windows and is thereby rendered capable of performing as the patented speech processor. The question before us: Does Microsoft’s liability extend to computers made in another country when loaded with Windows software copied abroad from a master disk or electronic transmission dispatched by Microsoft from the United States? Our answer is “No.”

The master disk or electronic transmission Microsoft sends from the United States is never installed on any of the foreign-made computers in question. Instead, copies made abroad are used for installation. Because Microsoft does not export from the United States the copies actually installed, it does not “suppl[y] . . . from the United States” “components” of the relevant computers, and therefore is not liable under §271(f) as currently written.

Plausible arguments can be made for and against extending §271(f) to the conduct charged in this case as infringing AT&T’s patent. Recognizing that §271(f) is an exception to the general rule that our patent law does not apply extraterritorially, we resist giving the language in which Congress cast §271(f) an expansive interpretation. Our decision leaves to Congress’ informed judgment any adjustment of §271(f) it deems necessary or proper.

I

Our decision some 35 years ago in Deepsouth Packing Co. v. Laitram Corp., 406 U. S. 518 (1972), a case about a shrimp deveining machine, led Congress to enact §271(f). In that case, Laitram, holder of a patent on the time and expense-saving machine, sued Deepsouth, manufacturer of an infringing deveiner. Deepsouth conceded that the Patent Act barred it from making and selling its deveining machine in the United States, but sought to salvage a

portion of its business: Nothing in United States patent law, Deepsouth urged, stopped it from making in the United States the parts of its deveiner, as opposed to the machine itself, and selling those parts to foreign buyers for assembly and use abroad. Id., at 522–524.1

We agreed.

Interpreting our patent law as then written, we reiterated in Deepsouth that it was “not an infringement to make or use a patented product outside of the United States.” Id., at 527; see 35 U. S. C. §271(a) (1970 ed.) (“[W]hoever without authority makes, uses or sells any patented invention, within the United States during the term of the patent therefor, infringes the patent.”). Deep-south’s foreign buyers did not infringe Laitram’s patent, we held, because they assembled and used the deveining machines outside the United States. Deepsouth, we therefore concluded, could not be charged with inducing or contributing to an infringement. 406 U. S., at 526–527.2

Nor could Deepsouth be held liable as a direct infringer, for it did not make, sell, or use the patented invention -- the fully assembled deveining machine -- within the United States. The parts of the machine were not themselves patented, we noted, hence export of those parts, unassembled, did not rank as an infringement of Laitram’s patent. Id., at 527–529.

Laitram had argued in Deepsouth that resistance to extension of the patent privilege to cover exported parts

“derived from too narrow and technical an interpretation of the [Patent Act].” Id., at 529. Rejecting that argument, we referred to prior decisions holding that “a combination patent protects only against the operable assembly of the whole and not the manufacture of its parts.” Id., at 528. Congress’ codification of patent law, we said, signaled no intention to broaden the scope of the privilege. Id., at 530 (“When, as here, the Constitution is permissive, the sign of how far Congress has chosen to go can come only from Congress.”). And we again emphasized that
“[o]ur patent system makes no claim to extraterritorial effect; these acts of Congress do not, and were not intended to, operate beyond the limits of the United States; and we correspondingly reject the claims of others to such control over our markets.” Id., at 531 (quoting Brown v. Duchesne, 19 How. 183, 195 (1857)).

Absent “a clear congressional indication of intent,” we stated, courts had no warrant to stop the manufacture and sale of the parts of patented inventions for assembly and use abroad. 406 U. S., at 532.

Focusing its attention on Deepsouth, Congress enacted §271(f). See Patent Law Amendments Act of 1984, §101, 98 Stat. 3383; Fisch & Allen, The Application of Domestic Patent Law to Exported Software: 35 U. S. C. §271(f), 25 U. Pa. J. Int’l Econ. L. 557, 565 (2004) (“Congress specifically intended §271(f) as a response to the Supreme Court’s decision in Deepsouth”).3

The provision expands

the definition of infringement to include supplying from the United States a patented invention’s components:
“(1) Whoever without authority supplies or causes to be supplied in or from the United States all or a substantial portion of the components of a patented invention, where such components are uncombined in whole or in part, in such manner as to actively induce the combination of such components outside of the United States in a manner that would infringe the patent if such combination occurred within the United States, shall be liable as an infringer.

“(2) Whoever without authority supplies or causes to be supplied in or from the United States any component of a patented invention that is especially made or especially adapted for use in the invention and not a staple article or commodity of commerce suitable for substantial noninfringing use, where such component is uncombined in whole or in part, knowing that such component is so made or adapted and intending that such component will be combined outside of the United States in a manner that would infringe the patent if such combination occurred within the United States, shall be liable as an infringer.” 35 U. S. C. §271(f).

II

Windows is designed, authored, and tested at Microsoft’s Redmond, Washington, headquarters. Microsoft sells Windows to end users and computer manufacturers, both foreign and domestic. Purchasing manufacturers install the software onto the computers they sell. Microsoft sends to each of the foreign manufacturers a master version of Windows, either on a disk or via encrypted electronic transmission. The manufacturer uses the master version to generate copies. Those copies, not the master sent by Microsoft, are installed on the foreign manu-

facturer’s computers. Once assembly is complete, the foreign-made computers are sold to users abroad. App. to Pet. for Cert. 45a–46a.4

AT&T’s patent (’580 patent) is for an apparatus (as relevant here, a computer) capable of digitally encoding and compressing recorded speech. Windows, the parties agree, contains software that enables a computer to process speech in the manner claimed by the ’580 patent. In 2001, AT&T filed an infringement suit in the United States District Court for the Southern District of New York, charging Microsoft with liability for domestic and foreign installations of Windows.

Neither Windows software (e.g., in a box on the shelf) nor a computer standing alone (i.e., without Windows installed) infringes AT&T’s patent. Infringement occurs only when Windows is installed on a computer, thereby rendering it capable of performing as the patented speech processor. Microsoft stipulated that by installing Windows on its own computers during the software development process, it directly infringed the ’580 patent.5

Microsoft further acknowledged that by licensing copies of Windows to manufacturers of computers sold in the United States, it induced infringement of AT&T’s patent.6

Id., at 42a; Brief for Petitioner 3–4; Brief for Respondent 9, 19.

Microsoft denied, however, any liability based on the master disks and electronic transmissions it dispatched to

foreign manufacturers, thus joining issue with AT&T. By sending Windows to foreign manufacturers, AT&T contended, Microsoft “supplie[d] . . . from the United States,” for “combination” abroad, “components” of AT&T’s patented speech processor; accordingly, AT&T urged, Microsoft was liable under §271(f). See supra, at 5 (reproducing text of §271(f)). Microsoft responded that unincorporated software, because it is intangible information, cannot be typed a “component” of an invention under §271(f). In any event, Microsoft urged, the foreign-generated copies of Windows actually installed abroad were not “supplie[d] . . . from the United States.” Rejecting these responses, the District Court held Microsoft liable under §271(f). 71 USPQ 2d 1118 (SDNY 2004). On appeal, a divided panel of the Court of Appeals for the Federal Circuit affirmed. 414 F. 3d 1366 (2005). We granted certiorari, 549 U. S.___ (2006), and now reverse.

III
A

This case poses two questions: First, when, or in what form, does software qualify as a “component” under §271(f)? Second, were “components” of the foreign-made computers involved in this case “supplie[d]” by Microsoft “from the United States”?7

As to the first question, no one in this litigation argues that software can never rank as a “component” under §271(f). The parties disagree, however, over the stage at which software becomes a component. Software, the “set of instructions, known as code, that directs a computer to

perform specified functions or operations,” Fantasy Sports Properties, Inc. v. Sportsline.com, Inc., 287 F. 3d 1108, 1118 (CA Fed. 2002), can be conceptualized in (at least) two ways. One can speak of software in the abstract: the instructions themselves detached from any medium. (An analogy: The notes of Beethoven’s Ninth Symphony.) One can alternatively envision a tangible “copy” of software, the instructions encoded on a medium such as a CD-ROM. (Sheet music for Beethoven’s Ninth.) AT&T argues that software in the abstract, not simply a particular copy of software, qualifies as a “component” under §271(f). Microsoft and the United States argue that only a copy of software, not software in the abstract, can be a component.8

The significance of these diverse views becomes apparent when we turn to the second question: Were components of the foreign-made computers involved in this case “supplie[d]” by Microsoft “from the United States”? If the relevant components are the copies of Windows actually installed on the foreign computers, AT&T could not persuasively argue that those components, though generated abroad, were “supplie[d] . . . from the United States” as §271(f) requires for liability to attach.9

If, on the other

hand, Windows in the abstract qualifies as a component within §271(f)’s compass, it would not matter that the master copies of Windows software dispatched from the United States were not themselves installed abroad as working parts of the foreign computers.10

With this explanation of the relationship between the two questions in view, we further consider the twin inquiries.

B

First, when, or in what form, does software become a “component” under §271(f)? We construe §271(f)’s terms “in accordance with [their] ordinary or natural meaning.” FDIC v. Meyer, 510 U. S. 471, 476 (1994). Section 271(f) applies to the supply abroad of the “components of a patented invention, where such components are uncombined in whole or in part, in such manner as to actively induce the combination of such components.” §271(f)(1) (emphasis added). The provision thus applies only to “such components”11

as are combined to form the “patented invention” at issue. The patented invention here is AT&T’s speech-processing computer.

Until 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. It cannot be inserted into a CD-ROM drive or downloaded from the Internet; it cannot be installed or executed on a computer. Abstract software code is an idea

without physical embodiment, and as such, it does not match §271(f)’s categorization: “components” amenable to “combination.” Windows abstracted from a tangible copy no doubt is information -- a detailed set of instructions -- and thus might be compared to a blueprint (or anything containing design information, e.g., a schematic, template, or prototype). A blueprint may contain precise instructions for the construction and combination of the components of a patented device, but it is not itself a combinable component of that device. AT&T and its amici do not suggest otherwise. Cf. Pellegrini v. Analog Devices, Inc., 375 F. 3d 1113, 1117–1119 (CA Fed. 2004) (transmission abroad of instructions for production of patented computerchips not covered by §271(f)).

AT&T urges that software, at least when expressed as machine-readable object code, is distinguishable from design information presented in a blueprint. Software, unlike a blueprint, is “modular”; it is a stand-alone product developed and marketed “for use on many different types of computer hardware and in conjunction with many other types of software.” Brief for Respondent 5; Tr. of Oral Arg. 46. Software’s modularity persists even after installation; it can be updated or removed (deleted) without affecting the hardware on which it is installed. Ibid. Software, unlike a blueprint, is also “dynamic.” Tr. of Oral Arg. 46. After a device has been built according to a blueprint’s instructions, the blueprint’s work is done (as AT&T puts it, the blueprint’s instructions have been “exhausted,” ibid.). Software’s instructions, in contrast, are contained in and continuously performed by a computer. Brief for Respondent 27–28; Tr. of Oral Arg. 46. See also Eolas Technologies Inc. v. Microsoft Corp., 399 F. 3d 1325, 1339 (CA Fed. 2005) (“[S]oftware code . . . drives the functional nucleus of the finished computer product.” (quoting Imagexpo, L. L. C. v. Microsoft Corp., 299 F. Supp. 2d 550, 553 (ED Va. 2003))).

The distinctions advanced by AT&T do not persuade us to characterize software, uncoupled from a medium, as a combinable component. Blueprints too, or any design information for that matter, can be independently developed, bought, and sold. If the point of AT&T’s argument is that we do not see blueprints lining stores’ shelves, the same observation may be made about software in the abstract: What retailers sell, and consumers buy, are copies of software. Likewise, before software can be contained in and continuously performed by a computer, before it can be updated or deleted, an actual, physical copy of the software must be delivered by CDROM or some other means capable of interfacing with the computer.12

Because it is so easy to encode software’s instructions onto a medium that can be read by a computer, AT&T intimates, that extra step should not play a decisive role under §271(f). But the extra step is what renders the software a usable, combinable part of a computer; easy or not, the copy-producing step is essential. Moreover, many tools may be used easily and inexpensively to generate the parts of a device. A machine for making sprockets might be used by a manufacturer to produce tens of thousands of sprockets an hour. That does not make the machine a “component” of the tens of thousands of devices in which the sprockets are incorporated, at least not under any ordinary understanding of the term “component.” Con-

gress, of course, might have included within §271(f)’s compass, for example, not only combinable “components” of a patented invention, but also “information, instructions, or tools from which those components readily may be generated.” It did not. In sum, a copy of Windows, not Windows in the abstract, qualifies as a “component” under §271(f).13

C

The next question, has Microsoft “supplie[d] . . . from the United States” components of the computers here involved? Under a conventional reading of §271(f)’s text,the answer would be “No,” for the foreign-made copies of Windows actually installed on the computers were “supplie[d]” from places outside the United States. The Federal Circuit majority concluded, however, that “for software ‘components,’ the act of copying is subsumed in the act of ‘supplying.’” 414 F. 3d, at 1370. A master sent abroad, the majority observed, differs not at all from the exact copies, easily, inexpensively, and swiftly generated from the master; hence “sending a single copy abroad with the intent that it be replicated invokes §271(f) liability for th[e] foreign-made copies.” Ibid.; cf. post, at 2 (STEVENS, J., dissenting) (“[A] master disk is the functional equivalent of a warehouse of components . . . that Microsoft fully expects to be incorporated into foreign-manufactured computers.”).

Judge Rader, dissenting, noted that “supplying” is ordinarily understood to mean an activity separate and dis-

tinct from any subsequent “copying, replicating, or reproducing -- in effect manufacturing.” 414 F. 3d, at 1372-1373 (internal quotation marks omitted); see id., at 1373 (“[C]opying and supplying are separate acts with different consequences -- particularly when the ‘supplying’ occurs in the United States and the copying occurs in Dusseldorf or Tokyo. As a matter of logic, one cannot supply one hundred components of a patented invention without first making one hundred copies of the component . . . .”). He further observed: “The only true difference between making and supplying software components and physical components [of other patented inventions] is that copies of software components are easier to make and transport.” Id., at 1374. But nothing in §271(f)’s text, Judge Rader maintained, renders ease of copying a relevant, no less decisive, factor in triggering liability for infringement. See ibid. We agree.

Section 271(f) prohibits the supply of components “from the United States . . . in such manner as to actively induce the combination of such components.” §271(f)(1) (emphasis added). Under this formulation, the very components supplied from the United States, and not copies thereof, trigger §271(f) liability when combined abroad to form the patented invention at issue. Here, as we have repeatedly noted, see supra, at 1-2, 5-6, the copies of Windows actually installed on the foreign computers were not themselves supplied from the United States.14

Indeed, those copies did not exist until they were generated by third parties outside the United States.15

Copying software

abroad, all might agree, is indeed easy and inexpensive. But the same could be said of other items: “Keys or machine parts might be copied from a master; chemical or biological substances might be created by reproduction; and paper products might be made by electronic copying and printing.” Brief for United States as Amicus Curiae 24. See also supra, at 11-12 (rejecting argument similarly based on ease of copying in construing “component”). Section 271(f) contains no instruction to gauge when duplication is easy and cheap enough to deem a copy in fact made abroad nevertheless “supplie[d] . . . from the United States.” The absence of anything addressing copying in the statutory text weighs against a judicial determination that replication abroad of a master dispatched from the United States “supplies” the foreign-made copies from the United States within the intendment of §271(f).16

D

Any doubt that Microsoft’s conduct falls outside §271(f)’s compass would be resolved by the presumption against extraterritoriality, on which we have already touched. See supra, at 2, 4. The presumption that United States law governs domestically but does not rule the world applies with particular force in patent law. The traditional understanding that our patent law “operate[s] only domestically and d[oes] not extend to foreign activities,” Fisch & Allen, supra, at 559, is embedded in the Patent Act itself, which provides that a patent confers exclusive rights in an invention within the United States. 35 U. S. C. §154(a)(1) (patentee’s rights over invention apply to manufacture, use, or sale “throughout the United States” and to importation “into the United States”). See Deepsouth, 406 U. S., at 531 (“Our patent system makes no claim to extraterritorial effect”; our legislation “d[oes] not, and [was] not intended to, operate beyond the limits of the United States, and we correspondingly reject the claims of others to such control over our markets.” (quoting Brown, 19 How., at 195)).

As a principle of general application, moreover, we have stated that courts should “assume that legislators take account of the legitimate sovereign interests of other nations when they write American laws.” F. Hoffmann-La Roche Ltd v. Empagran S. A., 542 U. S. 155, 164 (2004); see EEOC v. Arabian American Oil Co., 499 U. S. 244, 248 (1991). Thus, the United States accurately conveyed in this case: “Foreign conduct is [generally] the domain of foreign law,” and in the area here involved, in particular, foreign law “may embody different policy judgments about the relative rights of inventors, competitors, and the pub-

lic in patented inventions.” Brief for United States as Amicus Curiae 28. Applied to this case, the presumption tugs strongly against construction of §271(f) to encompass as a “component” not only a physical copy of software, but also software’s intangible code, and to render “supplie[d]. . . from the United States” not only exported copies of software, but also duplicates made abroad.

AT&T argues that the presumption is inapplicable because Congress enacted §271(f) specifically to extend the reach of United States patent law to cover certain activity abroad. But as this Court has explained, “the presumption is not defeated . . . just because [a statute] specifically addresses [an] issue of extraterritorial application,” Smith v. United States, 507 U. S. 197, 204 (1993); it remains instructive in determining the extent of the statutory exception. See Empagran, 542 U. S., at 161–162, 164–165; Smith, 507 U. S., at 204.

AT&T alternately contends that the presumption holds no sway here given that §271(f), by its terms, applies only to domestic conduct, i.e., to the supply of a patented invention’s components “from the United States.” §271(f)(1). AT&T’s reading, however, “converts a single act of supply from the United States into a springboard for liability each time a copy of the software is subsequently made [abroad] and combined with computer hardware [abroad] for sale [abroad.]” Brief for United States as Amicus Curiae 29; see 414 F. 3d, at 1373, 1375 (Rader, J., dissenting). In short, foreign law alone, not United States law, currently governs the manufacture and sale of components of patented inventions in foreign countries. If AT&T desires to prevent copying in foreign countries, its remedy today lies in obtaining and enforcing foreign patents. See Deepsouth, 406 U. S., at 531.17

IV

AT&T urges that reading §271(f) to cover only those copies of software actually dispatched from the United States creates a “loophole” for software makers. Liability for infringing a United States patent could be avoided, as Microsoft’s practice shows, by an easily arranged circumvention: Instead of making installation copies of software in the United States, the copies can be made abroad, swiftly and at small cost, by generating them from a master supplied from the United States. The Federal Circuit majority found AT&T’s plea compelling:

“Were we to hold that Microsoft’s supply by exportation of the master versions of the Windows® software—specifically for the purpose of foreign replication -- avoids infringement, we would be subverting the remedial nature of §271(f), permitting a technical avoidance of the statute by ignoring the advances in a field of technology -- and its associated industry practices -- that developed after the enactment of §271(f). . . . Section §271(f), if it is to remain effective, must therefore be interpreted in a manner that is appropriate to the nature of the technology at issue.” 414 F. 3d, at 1371.

While the majority’s concern is understandable, we are not persuaded that dynamic judicial interpretation of §271(f) is in order. The “loophole,” in our judgment, is properly left for Congress to consider, and to close if it finds such action warranted.

There is no dispute, we note again, that §271(f) is inapplicable to the export of design tools -- blueprints, schemat-

ics, templates, and prototypes -- all of which may provide the information required to construct and combine overseas the components of inventions patented under United States law. See supra, at 10–12. We have no license to attribute to Congress an unstated intention to place the information Microsoft dispatched from the United States in a separate category.

Section 271(f) was a direct response to a gap in our patent law revealed by this Court’s Deepsouth decision. See supra, at 4, and n. 3. The facts of that case were undeniably at the fore when §271(f) was in the congressional hopper. In Deepsouth, the items exported were kits containing all the physical, readily assemblable parts of a shrimp deveining machine (not an intangible set of instructions), and those parts themselves (not foreign-made copies of them) would be combined abroad by foreign buyers. Having attended to the gap made evident in Deepsouth, Congress did not address other arguable gaps: Section 271(f) does not identify as an infringing act conduct in the United States that facilitates making a component of a patented invention outside the United States; nor does the provision check “suppl[ying] . . . from the United States” information, instructions, or other materials needed to make copies abroad.18

Given that Congress did not home in on the loophole AT&T describes, and in view of the expanded extraterritorial thrust AT&T’s reading of §271(f) entails, our precedent leads us to leave in Congress’ court the patent-protective determination AT&T

seeks. Cf. Sony Corp. of America v. Universal City Studios, Inc., 464 U. S. 417, 431 (1984) (“In a case like this, in which Congress has not plainly marked our course, we must be circumspect in construing the scope of rights created by a legislative enactment which never contemplated such a calculus of interests.”).

Congress is doubtless aware of the ease with which software (and other electronic media) can be copied, and has not left the matter untouched. In 1998, Congress addressed “the ease with which pirates could copy and distribute a copyrightable work in digital form.” Universal City Studios, Inc. v. Corley, 273 F. 3d 429, 435 (CA2 2001). The resulting measure, the Digital Millennium Copyright Act, 17 U. S. C. §1201 et seq., “backed with legal sanctions the efforts of copyright owners to protect their works from piracy behind digital walls such as encryption codes or password protections.” Universal City Studios, 273 F. 3d, at 435. If the patent law is to be adjusted better “to account for the realities of software distribution,” 414 F. 3d, at 1370, the alteration should be made after focused legislative consideration, and not by the Judiciary forecasting Congress’ likely disposition.

For the reasons stated, the judgment of the Court of Appeals for the Federal Circuit is

Reversed.

THE CHIEF JUSTICE took no part in the consideration or decision of this case.

__________________

1 Deepsouth shipped its deveining equipment “to foreign customers in three separate boxes, each containing only parts of the 1¾-ton machines, yet the whole [was] assemblable in less than one hour.” Deepsouth Packing Co. v. Laitram Corp., 406 U. S. 518, 524 (1972).

2 See 35 U. S. C. §271(b) (1970 ed.) (“Whoever actively induces infringement of a patent shall be liable as an infringer.”); §271(c) (rendering liable as a contributory infringer anyone who sells or imports a “component” of a patented invention, “knowing the same to be especially made or especially adapted for use in an infringement of such patent, and not a staple article or commodity of commerce suitable for substantial non-infringing use”).

3 See also, e.g., Patent Law Amendments of 1984, S. Rep. No. 98–663,pp. 2–3 (1984) (describing §271(f) as “a response to the Supreme Court’s 1972 Deepsouth decision which interpreted the patent law not to make it infringement where the final assembly and sale is abroad”); Section-by-Section Analysis of H. R. 6286, 130 Cong. Rec. 28069 (1984) (“This proposal responds to the United States Supreme Court decision in Deepsouth . . . concerning the need for a legislative solution to close a loophole in [the] patent law.”).

4 Microsoft also distributes Windows to foreign manufacturers indirectly, by sending a master version to an authorized foreign “replicator”; the replicator then makes copies and ships them to the manufacturers. App. to Pet. for Cert. 45a–46a.

5 See 35 U. S. C. §271(a) (“[W]hoever without authority makes, uses, offers to sell, or sells any patented invention, within the United States or imports into the United States any patented invention during the term of the patent therefor, infringes the patent.”).

6 See §271(b) (“Whoever actively induces infringement of a patent shall be liable as an infringer.”).

7 The record leaves unclear which paragraph of §271(f) AT&T’s claim invokes. While there are differences between §271(f)(1) and (f)(2), see, e.g., infra, at 18, n. 18, the parties do not suggest that those differences are outcome determinative. Cf. infra, at 14–15, n. 16 (explaining why both paragraphs yield the same result). For clarity’s sake, we focus our analysis on the text of §271(f)(1).

8 Microsoft and the United States stress that to count as a component, the copy of software must be expressed as “object code.” “Software in the form in which it is written and understood by humans is called ‘source code.’ To be functional, however, software must be converted (or ‘compiled’) into its machine-usable version,” a sequence of binary number instructions typed “object code.” Brief for United States as Amicus Curiae 4, n. 1; 71 USPQ 2d 1118, 1119, n. 5 (SDNY 2004)(recounting Microsoft’s description of the software development process). It is stipulated that object code was on the master disks and electronic transmissions Microsoft dispatched from the United States.

9 On this view of “component,” the copies of Windows on the master disks and electronic transmissions that Microsoft sent from the United States could not themselves serve as a basis for liability, because those copies were not installed on the foreign manufacturers’ computers. See §271(f)(1) (encompassing only those components “combin[ed] . . . outside of the United States in a manner that would infringe the patent if such combination occurred within the United States”)

10 The Federal Circuit panel in this case, relying on that court’s prior decision in Eolas Technologies Inc. v. Microsoft Corp., 399 F. 3d 1325 (2005), held that software qualifies as a component under §271(f). We are unable to determine, however, whether the Federal Circuit panels regarded as a component software in the abstract, or a copy of software.

11“Component” is commonly defined as “a constituent part,” “element,” or “ingredient.” Webster’s Third New International Dictionary of the English Language 466 (1981).

12 The dissent, embracing AT&T’s argument, contends that, “unlike a blueprint that merely instructs a user how to do something, software actually causes infringing conduct to occur.” Post, at 3 (STEVENS, J., dissenting). We have emphasized, however, that Windows can “caus[e] infringing conduct to occur” -- i.e., function as part of AT&T’s speech-processing computer -- only when expressed as a computer-readable copy. Abstracted from a usable copy, Windows code is intangible, uncombinable information, more like notes of music in the head of a composer than “a roller that causes a player piano to produce sound.” Ibid.

13 We need not address whether software in the abstract, or any other intangible, can ever be a component under §271(f). If an intangible method or process, for instance, qualifies as a “patented invention” under §271(f) (a question as to which we express no opinion), the combinable components of that invention might be intangible as well. The invention before us, however, AT&T’s speech-processing computer, is a tangible thing.

14 In a footnote, Microsoft suggests that even a disk shipped from the United States, and used to install Windows directly on a foreign computer, would not give rise to liability under §271(f) if the disk were removed after installation. See Brief for Petitioner 37, n. 11; cf. post, at 2–4 (ALITO, J., concurring). We need not and do not reach that issue here.

15 The dissent analogizes Microsoft’s supply of master versions of Windows abroad to “the export of an inventory of . . . knives to be warehoused until used to complete the assembly of an infringing machine.” Post, at 2. But as we have underscored, foreign-made copies of Windows, not the masters Microsoft dispatched from the United States, were installed on the computers here involved. A more apt analogy, therefore, would be the export of knives for copying abroad, with the foreign-made copies “warehoused until used to complete the assembly of an infringing machine.” Ibid. Without stretching §271(f) beyond the text Congress composed, a copy made entirely abroad does not fit the description “supplie[d] . . . from the United States.”

16 Our analysis, while focusing on §271(f)(1), is equally applicable to §271(f)(2). But cf. post, at 1 (STEVENS, J., dissenting) (asserting “paragraph (2) . . . best supports AT&T’s position here”). While the two paragraphs differ, among other things, on the quantity of components that must be “supplie[d] . . . from the United States” for liability to attach, see infra, at 18, n. 18, that distinction does not affect our analysis. Paragraph (2), like (1), covers only a “component” amenable to “combination.” §271(f)(2); see supra, at 9–12 (explaining why Windows in the abstract is not a combinable component). Paragraph (2), like (1), encompasses only the “[s]uppl[y] . . . from the United States” of “such [a] component” as will itself “be combined outside of the United States.” §271(f)(2); see supra, at 12–13 and this page (observing that foreign-made copies of Windows installed on computers abroad were not “supplie[d] . . . from the United States”). It is thus unsurprising that AT&T does not join the dissent in suggesting that the outcome might turn on whether we view the case under paragraph (1) or (2).

17 AT&T has secured patents for its speech processor in Canada, France, Germany, Great Britain, Japan, and Sweden. App. in No. 04– 1285 (CA Fed.), p. 1477. AT&T and its amici do not relate what protections and remedies are, or are not, available under these foreign regimes. Cf. Brief for Respondent 46 (observing that “foreign patent protections are sometimes weaker than their U. S. counterparts” (emphasis added)).

18 Section 271(f)’s text does, in one respect, reach past the facts of Deepsouth. While Deepsouth exported kits containing all the parts of its deveining machines, §271(f)(1) applies to the supply abroad of “all or a substantial portion of” a patented invention’s components. And §271(f)(2) applies to the export of even a single component if it is “especially made or especially adapted for use in the invention and not a staple article or commodity of commerce suitable for substantial noninfringing use.”


ALITO, J., concurring

SUPREME COURT OF THE UNITED STATES

No. 05-1056

MICROSOFT CORPORATION, PETITIONER v.
AT&T CORP.

ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE FEDERAL CIRCUIT

[April 30, 2007]

JUSTICE ALITO, with whom JUSTICE THOMAS and JUSTICE BREYER join, concurring as to all but footnote 14.

I agree with the Court that no “component[s]” of the foreign-made computers involved in this case were “supplie[d]” by Microsoft “from the United States.” 35 U. S. C. §271(f)(1). I write separately because I reach this conclusion through somewhat different reasoning.

I

Computer programmers typically write programs in a “human readable” programming language. This “‘source code’” is then generally converted by the computer into a “machine readable code” or “machine language” expressed in a binary format. Brief for Respondent 5, n. 1 (citing R. White, How Computers Work 87, 94 (8th ed. 2006)); E. Walters, Essential Guide to Computing 204–205 (2001). During the Windows writing process, the program exists in the form of machine readable code on the magnetic tape fields of Microsoft’s computers’ hard drives. White, supra,at 144–145; Walters, supra, at 54–55.

When Microsoft finishes writing its Windows program in the United States, it encodes Windows onto CD-ROMs known as “‘golden masters’” in the form of machine readable code. App. 31, ¶4. This is done by engraving each disk in a specific way such that another computer can read

the engravings, understand what they mean, and write the code onto the magnetic fields of its hard drive. Ibid.; Brief for Petitioner 4, n. 2.

Microsoft ships these disks (or sends the code via electronic transmission) abroad, where the code is copied onto other disks that are then placed into foreign-made computers for purposes of installing the Windows program. App. 31–32, ¶¶5–8. No physical aspect of a Windows CDROM -- original disk or copy -- is ever incorporated into the computer itself. See Stenograph L. L. C. v. Bossard Assocs., Inc., 144 F. 3d 96, 100 (CADC 1998) (noting that, within the context of the Copyright Act, “installation of software onto a computer results in ‘copying’”); White, supra, at 144–145, 172–173. The intact CD-ROM is then removed and may be discarded without affecting the computer’s implementation of the code.*

The parties agree for purposes of this litigation that a foreign-made computer containing the Windows code would violate AT&T’s patent if present in the United States. Pet. for Cert. 42a, ¶5.

II
A

I agree with the Court that a component of a machine,whether a shrimp deveiner or a personal computer, must be something physical. Ante, at 9-11. This is because the word “component,” when concerning a physical device, is most naturally read to mean a physical part of the device. See Webster’s Third New International Dictionary 466 (1976) (component is a “constituent part: INGREDIENT”); Random House Dictionary of the English Language 301

(1967) (component is a “a component part; constituent”). Furthermore, §271(f) requires that the component be “combined” with other components to form the infringing device, meaning that the component must remain a part of any. Webster’s, supra, at 452 (combine means “to join in physical or chemical union”; “to become one”; “to unite into a chemical compound”); Random House, supra, at 293 (combine means “to bring or join into a close union or whole”). For these reasons, I agree with the Court that a set of instructions on how to build an infringing device, or even a template of the device, does not qualify as a component. Ante, at 9-10.

B

As the parties agree, an inventor can patent a machine that carries out a certain process, and a computer may constitute such a machine when it executes commands -- given to it by code -- that allow it to carry out that process. Such a computer would not become an infringing device until enough of the code is installed on the computer to allow it to execute the process in question. The computer would not be an infringing device prior to the installation, or even during the installation. And the computer remains an infringing device after the installation process because, even though the original installation device (such as a CD-ROM) has been removed from the computer, the code remains on the hard drive.

III

Here, Windows software originating in the United States was sent abroad, whether on a master disk or by means of an electronic transmission, and eventually copied onto the hard drives of the foreign-made computers. Once the copying process was completed, the Windows program was recorded in a physical form, i.e., in magnetic fields on the computers’ hard drives. See Brief for Respondent 5. The physical form of the Windows program on

the master disk, i.e., the engravings on the CD-ROM, remained on the disk in a form unchanged by the copying process. See Brief for Petitioner 4, n. 2 (citing White, How Computers Work, at 144–145, 172–173). There is nothing in the record to suggest that any physical part of the disk became a physical part of the foreign-made computer, and such an occurrence would be contrary to the general workings of computers.

Because no physical object originating in the United States was combined with these computers, there was no violation of §271(f). Accordingly, it is irrelevant that the Windows software was not copied onto the foreign-made computers directly from the master disk or from an electronic transmission that originated in the United States. To be sure, if these computers could not run Windows without inserting and keeping a CD-ROM in the appropriate drive, then the CD-ROMs might be components of the computer. But that is not the case here.

* * *

Because the physical incarnation of code on the Windows CD-ROM supplied from the United States is not a “component” of an infringing device under §271(f), it logically follows that a copy of such a CD-ROM also is not a component. For this reason, I join the Court’s opinion, except for footnote 14.

_________________________

* In a sense, the whole process is akin to an author living prior to the existence of the printing press, who created a story in his mind, wrote a manuscript, and sent it to a scrivener, who in turn copied the story by hand into a blank book.


STEVENS, J., dissenting

SUPREME COURT OF THE UNITED STATES

No. 05-1056

MICROSOFT CORPORATION, PETITIONER v.
AT&T CORP.

ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE FEDERAL CIRCUIT

[April 30, 2007]

JUSTICE STEVENS, dissenting.

As the Court acknowledges, “[p]lausible arguments can be made for and against extending §271(f) to the conduct charged in this case as infringing AT&T’s patent.” Ante, at 2. Strong policy considerations, buttressed by the presumption against the application of domestic patent law in foreign markets, support Microsoft Corporation’s position. I am, however, persuaded that an affirmance of the Court of Appeals’ judgment is more faithful to the intent of the Congress that enacted §271(f) than a reversal.

The provision was a response to our decision in Deepsouth Packing Co. v. Laitram Corp., 406 U. S. 518 (1972), holding that a patent on a shrimp deveining machine had not been infringed by the export of components for assembly abroad. Paragraph (1) of §271(f) would have been sufficient on its own to overrule Deepsouth**, but it is paragraph (2) that best supports AT&T’s position here. It

provides:
“Whoever without authority supplies or causes to be supplied in or from the United States any component of a patented invention that is especially made or especially adapted for use in the invention and not a staple article or commodity of commerce suitable for substantial noninfringing use, where such component is uncombined in whole or in part, knowing that such component is so made or adapted and intending thaat such component will be combined outside of the United States in a manner that would infringe the patent if such combination occurred within the United States, shall be liable as an infringer.” 35 U. S. C. §271(f)(2).

Under this provision, the export of a specially designed knife that has no use other than as a part of a patented deveining machine would constitute infringement. It follows that §271(f)(2) would cover the export of an inventory of such knives to be warehoused until used to complete the assembly of an infringing machine.

The relevant component in this case is not a physical item like a knife. Both Microsoft and the Court think that means it cannot be a “component.” See ante, at 10. But if a disk with software inscribed on it is a “component,” I find it difficult to understand why the most important ingredient of that component is not also a component. Indeed, the master disk is the functional equivalent of a warehouse of components -- components that Microsoft fully expects to be incorporated into foreign-manufactured computers. Put somewhat differently: On the Court’s view, Microsoft could be liable under §271(f) only if it sends individual copies of its software directly from the United States with the intent that each copy would be incorporated into a separate infringing computer. But it seems to me that an indirect transmission via a master disk warehouse is likewise covered by §271(f).

I disagree with the Court’s suggestion that because software is analogous to an abstract set of instructions, it cannot be regarded as a “component” within the meaning of §271(f). See ante, at 9-10. Whether attached or detached from any medium, software plainly satisfies the dictionary definition of that word. See ante, at 9, n. 11 (observing that “‘[c]omponent’ is commonly defined as ‘a constituent part,’ ‘element,’ or ‘ingredient’”). And unlike a blueprint that merely instructs a user how to do something, software actually causes infringing conduct to occur. It is more like a roller that causes a player piano to produce sound than sheet music that tells a pianist what to do. Moreover, it is surely not “a staple article or commodity of commerce suitable for substantial noninfringing use” as that term is used in §271(f)(2). On the contrary, its sole intended use is an infringing use.

I would therefore affirm the judgment of the Court of Appeals.

____________________

** “Whoever without authority supplies or causes to be supplied in or from the United States all or a substantial portion of the components of a patented invention, where such components are uncombined in whole or in part, in such manner as to actively induce the combination of such components outside of the United States in a manner that would infringe the patent if such combination occurred within the United States, shall be liable as an infringer.” 35 U. S. C. §271(f)(1).


  


2 Major Patent Rulings from the US Supreme Court - KSR and Microsoft v. AT&T | 459 comments | Create New Account
Comments belong to whoever posts them. Please notify us of inappropriate comments.
Corrections thread.
Authored by: Aladdin Sane on Monday, April 30 2007 @ 12:41 PM EDT
Please place corrections under this comment.

---
"Cosmetic: A bug that will only affect the end user." --me, March 2007

[ Reply to This | # ]

Mild disappointment...
Authored by: Aim Here on Monday, April 30 2007 @ 12:43 PM EDT
... that the Microsoft ruling didn't explicitly overturn Eolas vs Microsoft, and
by extension software patents, as suggested by the SFLC amicus curiae.

Good news though anyways!

[ Reply to This | # ]

Off Topic Here
Authored by: DannyB on Monday, April 30 2007 @ 12:46 PM EDT
Please make links clicky. (Or readers could install the FireFox Linkification
plug in.)

---
The price of freedom is eternal litigation.

[ Reply to This | # ]

2 Major Patent Rulings from the US Supreme Court
Authored by: kozmcrae on Monday, April 30 2007 @ 12:58 PM EDT
Do these rulings strengthen or weaken Steve Ballmer's threat that Linux contains
Microsoft IP.

Richard

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Darl, have you been lying to us? Yup.

[ Reply to This | # ]

Unfortunately, they didn't resolve the overall patent issue
Authored by: Anonymous on Monday, April 30 2007 @ 01:00 PM EDT
While the rulings distinctly improve the existing patent situation, the Supreme
Court has again avoided the central issue of whether software is patentable in
the first place.

[ Reply to This | # ]

These rulings are illogical hairsplitting
Authored by: tarran on Monday, April 30 2007 @ 01:00 PM EDT
The court is dancing around the elephant in the room: there is no moral justification for granting patents of monopoly on some things, and not on others. Until this is recognized and the entire system of patents are excised from the body of law, we will be treated to silly spectacles like this. Economist Murray Rothbard considers and rejects patents of monopoly:
The common law has often been a good guide to the law consonant with the free market. Hence, it is not surprising that common-law copyright prevails for unpublished literary manuscripts, while there is no such thing a common-law patent. At common law, the inventor also has the right to keep his invention unpublicized and safe from theft, i.e., he has the equivalent of the copyright protection for unpublicized inventions.
Patents and Copyrights

[ Reply to This | # ]

Transcriptions here please
Authored by: Anonymous on Monday, April 30 2007 @ 01:13 PM EDT
Thanks

[ Reply to This | # ]

    2 Major Patent Rulings from the US Supreme Court
    Authored by: Chris Lingard on Monday, April 30 2007 @ 01:23 PM EDT

    I too am delighted by this decision, the best quote was:

    "The presumption that United States law governs domestically but does not rule the world applies with particular force in patent law," said Justice Ruth Bader Ginsburg.

    This is an annoying characteristic of some Americans, (businesses in particular), that their law applies over here, American law stops at your 100 mile limit, (or wherever you claim your border is).

    It also makes people realise that patents are not universally applicable, and what is patentable in the USA, may not be patentable elsewhere.

    [ Reply to This | # ]

    KSR v. Teleflex: "ordinary innovation" not patentable
    Authored by: jbeale on Monday, April 30 2007 @ 01:25 PM EDT
    I enjoyed reading this part:
    ------------------------------------------------------
    And as progress beginning from higher levels of achievement is expected in the normal course, the results of ordinary innovation are not the subject of exclusive rights under the patent laws. Were it otherwise patents might stifle, rather than promote, the progress of useful arts.
    ------------------------------------------------------
    KSR INT’L CO. v. TELEFLEX INC. decided April 30 2007, p. 24
    www.supremecourtus.gov/opinions/06pdf/04-1350.pdf p.31

    [ Reply to This | # ]

    I agree with Justice Stevens in the MS case
    Authored by: Wardo on Monday, April 30 2007 @ 01:29 PM EDT
    Put somewhat differently: On the Court’s view, Microsoft could be liable under §271(f) only if it sends individual copies of its software directly from the United States with the intent that each copy would be incorporated into a separate infringing computer. But it seems to me that an indirect transmission via a master disk warehouse is likewise covered by §271(f).

    The whole intent of sending the master copy, in physical or digital form, is to create what would be infringing materials if assembled in the US.

    Without the MS operating system, these machines could be assembled and sold with no fear of violating the patent (unless whatever OS you used was also infringing of course). So how can the software "warehouse" as the Justice puts it, not constitute a component of the resulting product? One master copy is as good as an infinite number of actual copies, due to the nature of digital recordings.

    The other point of contention among the justices is footnote 14, which seems to imply that if MS made individual copies and shipped one overseas per computer to be made, it might violate. However, the Justices didn't need to weigh in on that point, so it's still undecided.

    14In a footnote, Microsoft suggests that even a disk shipped from the United States, and used to install Windows directly on a foreign com-puter, would not give rise to liability under §271(f) if the disk were removed after installation. See Brief for Petitioner 37, n. 11; cf. post, at 2–4 (ALITO, J., concurring). We need not and do not reach that issue here.

    I wonder if it was mentioned that the disks made overseas from the master, may have been sold with the computer as a "rescue disk". Then the resulting copy is definately part of the final product that is sold to the consumer.

    Wardo

    ---
    caveat lector...
    Wardo = new user(lawyer = FALSE,badTypist = TRUE,badSpeller = TRUE);

    [ Reply to This | # ]

    narrow verdict
    Authored by: stites on Monday, April 30 2007 @ 01:33 PM EDT

    In Microsoft v AT&T the Supreme Court started their logic with some premises that would lead to a ruling that software can be copyrighted but not patented. But since neither Microsoft nor AT&T challenged software patents per se the Supreme Court issued a narrow ruling that U.S. software patents cannot be asserted against Windows outside the U.S. given the method that Microsoft is using to distribute Windows in Europe.

    I would like to see a software patent case go to the Supreme Court where the basic validity of software patents in the U.S. is challenged. Such a case could quote large portions of this ruling as arguments against the validity of software patents. Here are two of the relevent sections:

    [pages 9 and 10]
    "Abstract software code is an idea without physical embodiment, and as such, it does not match S271(f)'s categorization: "components" amenable to "combination". . . ."

    [page 11]
    "The distinctions advanced by AT&T do not persuade us to characterize software, uncoupled from a medium, as a combinable component. Blueprints too, or any design information for that matter, can be independently developed, bought and sold. If the point of AT&T's argument is that we do not see blueprints lining stores' shelves, the same observation may be made about software in the abstract: what retailers sell and consumers buy, are copies of software."

    ------------------
    Steve Stites

    [ Reply to This | # ]

    Bets on how fast AT&T can get Congress to move?
    Authored by: Wardo on Monday, April 30 2007 @ 01:35 PM EDT
    (d) While reading §271(f) to exclude from coverage foreign-made copies of software may create a “loophole” in favor of software makers, the Court is not persuaded that dynamic judicial interpretationof §271(f) is in order; the “loophole” is properly left for Congress to consider, and to close if it finds such action warranted.

    If it was MS on the loosing side, I would expect action within a week, I wonder how long before AT&T gets a bill introduced...

    Wardo

    ---
    caveat lector...
    Wardo = new user(lawyer = FALSE,badTypist = TRUE,badSpeller = TRUE);

    [ Reply to This | # ]

    Whoa, Everyone! Keep Your Eye On The Shell With The Pea Under It!
    Authored by: Anonymous on Monday, April 30 2007 @ 01:47 PM EDT
    Hey everybody!

    Let's not celebrate just yet. Remember, there are still politicos trying to
    introduce bills to "reform" the patent system. This is not over yet.

    Dobre utka,
    The Blue Sky Ranger

    [ Reply to This | # ]

    2 Major Patent Rulings from the US Supreme Court
    Authored by: Anonymous on Monday, April 30 2007 @ 01:53 PM EDT
    Both links are broken from what I am seeing, the first one goes to the KSR vs
    case and the second one goes to blank page.

    [ Reply to This | # ]

    Software ???
    Authored by: Anonymous on Monday, April 30 2007 @ 02:24 PM EDT
    <i>. . . Granting patent protection to advances that would occur in the
    ordinary course without real innovation retards progress and may, for patents
    combining previously known elements, deprive prior inventions of their value or
    utility. . . . </i>

    This is just one example of the language in the KSR decision that appears to me
    - not a lawyer - to indicate that future patent decisions respecting software
    are going to be more discerning. The entire language of the decision indicates
    that "non-obviousness" is going to have to contain really innovative
    thought and creativity. At another point in the decision, the court observes
    that an ordinary person skilled in the art is not only of ordinary intelligence,
    but also ordinary creativity and is not an automaton. Another observation made
    is that as new knowledge enters our common pool, the threshold of
    "non-obvious" must also change. The court also provided an example of
    combining known elements to new ends WAS patentable based upon previous case
    law. Since that example related to the counter intutive and against common
    wisdom combination of elements widely considered incompatible, it offers a clear
    suggestion of the degree of innovative and creative thought required to justify
    a patent composed of previously known elements.

    I think that this decision could actually force the software industry to fall
    back on copyright law more and leave patents to genuine physical inventions.
    The drift of the decision strongly indicates that solutions to common problems
    that consist of commonly known methods applied in a commonly used manner won't
    satisfy the law.

    The decision also concludes with some broad hints to both the Appeals court and
    the PTO that suggest that both need to do better jobs than they have been. The
    suggestion is pretty clear that the SC really doesn't want to be come a clearing
    house for patent infringement cases and expects the primary bodies involved to
    expedite this by being more bullet proof in their decisions. The emphasis on
    the term "common sense" in the decision is pretty revealing all by it
    self. That was directed at the Appeals court. The SC also suggests that the
    PTO may need to tighten up its garters before it socks fall off:

    <i> We nevertheless think it appropriate to note that the rationale
    underlying the presumption—that the PTO, in its expertise, has approved the
    claim—seems much diminished here.</i>


    [ Reply to This | # ]

    2 Major Patent Rulings from the US Supreme Court
    Authored by: Anonymous on Monday, April 30 2007 @ 02:29 PM EDT
    It seems to me they've missed the point almost altogether. I say almost, because
    Justice Stephens, in his dissent, did get one small thing mostly right: that a
    computer program is like the music written on a player piano roll, which, if I'm
    not mistaken would be protected under copyright, not pattent law. (or would
    pattenting my latest sonnatta be as simple as writing it with a hole punch
    instead of a pencil?)

    The reason the software isn't a "component" under Section 271f has
    nothing to do with whether it was supplied from the US or manufactured abroad.
    It isn't a "component" under 271f because, whether it's written out
    longhand or written on the registers a general-purpose computer during
    execution, it is a representation of a mathematical algorithm and therefore
    doesn't qualify as proper subject matter under pattent law.

    [ Reply to This | # ]

    2 Major Patent Rulings from the US Supreme Court
    Authored by: Anonymous on Monday, April 30 2007 @ 02:40 PM EDT
    So, does this mean that Fedora, Ubuntu et. al can now produce "golden
    masters" with potentially infringing software on them and make copies
    abroad without worry?

    [ Reply to This | # ]

    Federal Circuit Smackdown
    Authored by: rsteinmetz70112 on Monday, April 30 2007 @ 03:02 PM EDT
    In KSR and in other recent patent rulings the Supremes seem to be trying to send
    the Federal Circuit a message.

    I hope it works.

    Its pretty clear the SCOTUS has decided patents are a mess and that they need to
    step in. In KSR they seem to be beating the Federal Circuit over the head with
    the clue stick. Reading between the lines they seem to singling out the Federal
    Circuit for "special attention".

    I personally believe that having all patent appeals go through the Federal
    Circuit was a mistake. In the short term we are going to see a lot more appeals
    from the Federal Circuit, at least until the Supreme Court stops reversing them.

    ---
    Rsteinmetz - IANAL therefore my opinions are illegal.

    "I could be wrong now, but I don't think so."
    Randy Newman - The Title Theme from Monk

    [ Reply to This | # ]

    Say Goodbye to One-Click
    Authored by: darkonc on Monday, April 30 2007 @ 03:52 PM EDT
    A court must ask whether the improvement is more than the predictable use of prior-art elements according to their intended functions.
    One-click essentially patents the use of cookies -- but in the specific area of remembering information that the customer had already applied (i.e. exactly what a cookie is designed to do).
    so, .... uhm... the One-click patent is 'non-obvious' because the information remembered is finance-related (or something like that).

    splat!

    ---
    Powerful, committed communication. Touching the jewel within each person and bringing it to life..

    [ Reply to This | # ]

    Time to get come popcorn
    Authored by: PolR on Monday, April 30 2007 @ 05:01 PM EDT
    Reading all the comments on the consequences of KSR on the obviousness test, a
    question occurs to me.

    How reliable are software patents from the point of view of the patent holder?
    How can the patent holder predict if his patent will pass the non-obviousness
    test?

    If patent holders can't have reasonable assurance their patents pass the test,
    they will be less likely to file for them or use them in a lawsuit unless they
    want to make a nuisance out of themselves and don't care wasting their legal
    fees.

    This is opening up a can of worms. How much will remain of software patents once
    the courts rule in more details on how the obviousness test should work? How
    much will remain after SCOTUS rule on a patentability test for software? It will
    take more cases for these things to be settled. Until then it is open season for
    more patent challenges. Let's get some popcorn and watch the legal show.

    [ Reply to This | # ]

    did the sflc brief drop into a black hole?
    Authored by: Anonymous on Monday, April 30 2007 @ 05:29 PM EDT
    I couldn't find anyplace they even referred to the sflc brief. Hoped they'd at
    least say something about the issues it raised.

    [ Reply to This | # ]

    I am wondering though
    Authored by: Anonymous on Monday, April 30 2007 @ 05:57 PM EDT
    A quick read in slashdot brings up an interesting thought. MS (US) claim tax
    rebates in the US because of their actions as MS (Asia).

    I can't quite find out WHAT they get, but I would say that if MS(US) gain
    ANYTHING from the actions taken by MS(Asia) then they are (at least partially)
    involved in making the product that infringes AT&T's patent.

    'course if there WERE no software patents, then this would not be a problem.

    MS must be REALLY cacking themselves over their vision of patent deluge (since
    the reason why they take so many patents is not because they want to abuse them
    but because they need to defend themselves. Yea...).

    [ Reply to This | # ]

    The History of Software Patents
    Authored by: Anonymous on Monday, April 30 2007 @ 06:34 PM EDT
    The History of Software Patents

    http://www.bitlaw.com/software-patent/history.html

    [ Reply to This | # ]

    LiveCDs
    Authored by: McMartin on Monday, April 30 2007 @ 06:44 PM EDT
    "Naturally, I think of Knoppix and other live CDs."

    Hmm. Can't you run Knoppix and the like off of the internal drives, too? I'm
    having trouble imagining a system where you'd *have* to have the CD in the drive
    all the time and couldn't design around it.

    Well, absent particularly egregious DRM measures, but removing those would be
    part of "designing around it". =)

    [ Reply to This | # ]

    • LiveCDs - Authored by: rsteinmetz70112 on Monday, April 30 2007 @ 08:45 PM EDT
      • LiveCDs - Authored by: Anonymous on Monday, April 30 2007 @ 09:59 PM EDT
        • LiveCDs - Authored by: McMartin on Tuesday, May 01 2007 @ 12:19 AM EDT
        • LiveCDs - Authored by: analyzer on Tuesday, May 01 2007 @ 07:30 PM EDT
          • LiveCDs - Authored by: Anonymous on Tuesday, May 01 2007 @ 09:40 PM EDT
    2 Major Patent Rulings from the US Supreme Court
    Authored by: Anonymous on Monday, April 30 2007 @ 07:25 PM EDT
    Doesn't this make the US a software patent ghetto? I mean the way i read msft
    vs. att doesn't it mean that US companies can work on patent infringing
    software, and then only have to worry about licenses in the US market? So for
    example, with open source, wouldn't it mean that all us providers could write
    infringing software (MP3 Decoders, Non decrypting dvd players) and then only
    ship the products overseas for free?

    [ Reply to This | # ]

    2 Major Patent Rulings from the US Supreme Court
    Authored by: Anonymous on Monday, April 30 2007 @ 09:09 PM EDT
    "Chief Justice Alito's concurring opinion"

    I could be wrong, but last I checked, Roberts is the Chief Justice and Alito's
    title is merely Justice.

    [ Reply to This | # ]

    So Source Code outside the USA...
    Authored by: Anonymous on Monday, April 30 2007 @ 09:28 PM EDT
    Would this prevent MS or others from bringing suit against people over Linux (or
    other FOSS) source code kept outside the USA, even if they believed it infringed
    upon their patents?

    Not great, but it would contain some of the harm...

    [ Reply to This | # ]

    How does this link in with the EU rulings?
    Authored by: lego_boy on Monday, April 30 2007 @ 09:52 PM EDT
    Forgive me if this has been asked elsewhere, but how does this tie in with what is happening in the EU?

    From the EU:
    "the EU said it examined 160 Microsoft claims to patented technologies, and concluded that among those, only four may only deserve to claim 'a limited degree of innovation.'"

    From KSR Int'l Co. v. Teleflex Inc.:
    "We build and create by bringing to the tangible and palpable reality around us new works based on instinct, simple logic, ordinary inferences, extraordinary ideas, and sometimes even genius. These advances, once part of our shared knowledge, define a new threshold from which innovation starts once more. And as progress beginning from higher levels of achievement is expected in the normal course, the results of ordinary innovation are not the subject of exclusive rights under the patent laws. Were it otherwise patents might stifle, rather than promote, the progress of useful arts. See U. S. Const., Art. I, §8, cl. 8. These premises led to the bar on patents claiming obvious subject matter established in Hotchkiss and codified in §103. Application of the bar must not be confined within a test or formulation too constrained to serve its purpose."

    To my very limited understanding, it looks like MS have been told there isn't any "innovation" behind their patents, and this being the case, they could have a great deal of trouble for them should they actually decide to "enforce" these patents in court. After all, if something isn't innovative, one would expect it must therefore be obvious?

    Of course I could (easily) be wrong...

    [ Reply to This | # ]

    Good news for Gentoo linux
    Authored by: Anonymous on Monday, April 30 2007 @ 10:27 PM EDT
    The thing that makes Gentoo linux stand out is that, excepting for a little bit
    of closed-source proprietary stuff (RealPlayer, Shockwave Flash, certain video
    card drivers, etc) the kernel, driver, and applications are downloaded ***AS
    SOURCE CODE***. The Gentoo Portage system automatically compiles the source
    code on your machine. This is done for a couple of reasons...
    1) Binary distros *MUST*
    - either put out a "lowest common denominator" i686 version that
    works on all 32-bit X86 cpus from the Pentium-Pro to an AMD64 running in 32 bit
    mode
    - or put out a bunch of separate versions for Intel's PII, PIII, PIV, and
    AMD's K6, K7, K8, etc, etc.
    Under Gentoo, the "emerge" command downloads sourcecode, and compiles
    it ***ACCORDING TO YOUR SETTINGS***, which you've hopefully optimized for your
    CPU's capabilities (sse, sse2. sse3 mmx, mmxext, 3dnow, etc, etc). Of course,
    apps/kernels compiled for a P4 won't run on a p3, etc.

    2) Gentoo's USE variable allows you fine-grained control over optional
    dependacies. In an RPM-based binary distro, you ***MUST*** follow the choice of
    optional dll's that an RPM-maintainer links in.

    I'm emphasizing the above to point out that Gentoo wasn't invented today, merely
    to circumvent a court decision. I've got a 1999 Dell with a 450 mhz PIII and
    128 megs of ram. It's still ticking, and I keep it around as my backup machine.
    My main machine has twice as much video ram as the Dell has main ram. I tried
    loading Xubuntu (the "most lightwieght" member of the Ubuntu family)
    on it. Major mistake; the install was excruciatingly slow, whilst the installed
    system was only painfully slow. Gentoo, with Blackbox WM, runs just fine. The
    only problems are...
    - dropping frames with internet TV
    - a bit slow manipulating 2560x1920 digital photos with the Gimp.

    The fact that source code is treated less strictly in the court ruling is great
    news for Gentoo, because Gentoo is almost totally source-cpde based.

    [ Reply to This | # ]

    Question regarding Footnote 14
    Authored by: Anonymous on Monday, April 30 2007 @ 10:33 PM EDT
    Can someone spell out in simpler language what the importance of Footnote 14 is
    in the Microsoft judgment? I'm reading the original text, and I'm not quite sure
    why Alito and company specifically disagreed with the Ginsburg majority ruling
    on this footnote. (Mind you, it's 'prolly because it's late in the day for me
    when I read all this...)

    [ Reply to This | # ]

    Now look to the future and think of the fun
    Authored by: caecer on Monday, April 30 2007 @ 10:44 PM EDT
    if/when we get quantum computing, or even quantum cryptography applied to
    program registration/activation, using entangled states. What would happen if
    the foreign machine couldn't be activated except when an American machine was in
    a certain quantum state? Is the state of the American machine a
    "component" of the foreign machine? Has that component been exported
    if the foreign machine is successfully activated? Or if the state of the foreign
    machine (e.g. whether it could act as a speech processor) depended on the state
    of a machine in America? Same questions. Or even if the successful copying of
    the exported "master disk" required quantum teleportation of the state
    of that master to the copy? Anybody want to try to explain the necessary
    concepts to the Supreme Court? </tongue far into cheek>

    [ Reply to This | # ]

    What happens to Obvious Patents now?
    Authored by: grahamt on Tuesday, May 01 2007 @ 01:58 AM EDT
    What happens to patents which were granted under the now obsoleted standards?
    For example, what if a patent application openly acknowledged that it was
    applying and relying on the TSM test?

    Can we ever expect the PTO to review currently granted patents and cancel
    inappropriate patents? Or does the PTO consider a patent, once granted, as
    always being valid, leaving the overburdened courts to resolve the matter on a
    case by case basis?

    [ Reply to This | # ]

    I'm still confused on the Microsoft findings.
    Authored by: Ian Al on Tuesday, May 01 2007 @ 06:01 AM EDT
    The court specifically made the point that it was not Microsoft that created the
    final part that went together with a computer from another manufacturer to form
    the patent violating machine.

    However, Microsoft, in addition to OEM agreements, also export the golden
    masters as part of the production process to enable their fully owned foreign
    subsidiaries (also called, Microsoft) to sell to computer stores for sale to
    end-users. You can see the components for sale in any computer store.

    Is the 'foreign component manufacturer' phrase a red herring? Is it the case
    that any US manufacturer of a component of an invention which is only patented
    and can only be patentable in the US (see where I am going, here?) can
    manufacture the component/s in a foreign subsidiary so long as they avoid patent
    violation by selling the component to a company outside of US jurisdiction for
    final assembly of the machine? That manufacturer must, of course, still be
    careful not to export the machine to the States.

    I'm not the only one outside the US is confused. How else can you explain the
    rackfulls of unsold Vista?

    ---
    Regards
    Ian Al

    [ Reply to This | # ]

    Da Court - is it too old to understand software? Is congress also too old too? Seems likely.
    Authored by: Anonymous on Tuesday, May 01 2007 @ 06:12 AM EDT

    The court missed the meaning of what "software" is, and totally missed the meaning of “digital” as well - they were too vague (I am being nice)!

    Is the current Supreme Court too old to make this kind of decision? Would a “younger” Chief Justice Roberts have been of an age where he was young enough to guide the decision in a more complete direction? Could the ruling have been more specific in it's question aimed at Congress? Or is Congress, also a bunch of old fuddy-duddy types that don't understand TECH at all either, and/or is Congress (full of lawyers, and not full of tech experts) supposed to just figure it all out (what affect will a lobbiest's dollar have on the ear of Congress)?

    Foundational links:

    Enjoy this educational video & will congress force SW copyright "only" idea to drink hemlock? -

    I don't think the Justices "got" what digital is, in the same way as Dr. Smith describes it... -

    Yep - the fact that the court sees software as viewed from this QUOTE from majority opinion lends and understanding of the limits of the current court's grasp of all things digital...  Here is the quote from the ruling that only scratches the surface and does so in a limited way by saying that software can be viewed in only 2 ways:

    "One can speak of software in the abstract: the instructions themselves detached from any medium. (An analogy: The notes of Beethoven’s Ninth Symphony.) One can alternatively envision a tangible “copy” of software,the instructions encoded on a medium such as a CD-ROM. (Sheet music for Beethoven’s Ninth.)"

    ... leaves us wondering how loud the laugh will be when future generations look at this ruling and read this. Even today, this statement alone, in most IT computer classes could be seen as “the stuff of comedy”.

    The court really does not get “IT” at all... they were on track, but to do justice and settle the issue where they would require congress to look at the details as well, they really needed to go much more into the details. They need to see the forest thru the trees. Alas, due to their generation, their age, and the fact that Chief Justice Roberts did not sit in this case, did this all result in this “misunderstanding of software”. Is it so simple as that? I don't know? I expected more (given that these folks have clerks that might be “young”, but maybe the young clerks, as lawyers, don't get “IT” either). GO FIGURE Huh?

    I am encouraged that they are throwing software patents (to some degree) this back to Congress (and I shudder with the potential fear that a congressional nightmare could evolve into at the same time)... but, they could have included more instruction as to the detail that congress needs to address in order to guide a court in the future. OR – is this for congress to decide as the ruling says:

    "Congress is doubtless aware of the ease with which software (and other electronic media) can be copied, and has not left the matter untouched. In 1998, Congress addressed “the ease with which pirates could copy and distribute a copyrightable work in digital form.” Universal City Studios, Inc. v. Corley, 273 F. 3d 429, 435 (CA2 2001). The resulting measure, the Digital Millennium Copyright Act, 17 U. S. C. §1201 et seq., “backed with legal sanctions the efforts of copyright owners to protect their works from piracy behind digital walls such as encryption codes or password protections.” Universal City Studios, 273 F. 3d, at 435. If the patent law is to be adjusted better “to ac-count for the realities of software distribution,” 414 F. 3d, at 1370, the alteration should be made after focused legis-lative consideration, and not by the Judiciary forecasting Congress’ likely disposition".

    Maybe the court is right, and looking at the law, from their aged (and dated) points of view of software, where it is as simple as how it is in it's story form on a CD?

    IS it now up to Congress to grapple with the DETAILS - Help us all if that is the case?

    I really don't feel good about Congress understanding TECH any better than the court seems to...? Ouch.

    Send a copy of the CSPAN DVD with Brian Cantwell Smith's “Digital Future Series” talk to your Senator or Congress-person today. Hopefully they will view it a few times, with their kids or grand kids who are taking computer courses, and learn from them what Dr Smith is talking about. Then they might be able to tackle the direction that the court is looking for (in the correct detail that is needed for such an exercise to happen).

    The Congress needs to understand that software is all about the copyright... and that software patents should not exist at all.

    [ Reply to This | # ]

    Can I lob in a hand-grenade?
    Authored by: Alan(UK) on Tuesday, May 01 2007 @ 06:19 AM EDT
    This problem of the accelerator pedal strikes me as one that could be solved by
    computer alone. The ergonomics people give a complete description of the human
    interface, the engineers give a complete description of the mechanical
    interface, the accountants set a limit on the cost.

    The computer now tries different configurations and works out the optimum
    dimensions and the total cost of each one.

    When the design is complete, the CAD/CAM system can turn out a prototype (or
    even the tooling for production).

    Can the resultant product be patented? (Or can the drawings be copyrighted?)



    ---
    Microsoft is nailing up its own coffin from the inside.

    [ Reply to This | # ]

    Totally obvious
    Authored by: soronlin on Tuesday, May 01 2007 @ 07:36 AM EDT
    Back in the mid-1980s, (fresh out of University with an MSc in Computer
    Science,) I built an electronic throttle for "Elite", (one of the
    first space simulator games.) It used a sensor attached to the support. It would
    have been obviously better and simpler to use the pivot point, but
    manufacturability considerations precluded it. It would never have occurred to
    me to attach the sensor to the pedal; that would have added wear and tear on
    the wiring for no gain. As it was the wiring was very thin, had no strain relief
    and never needed repair.

    The pedal was two pieces of wood - maybe floorboard offcuts, a door hinge, a
    slide potentiometer (like those sliders you get on mixing desks,) a couple of
    nails, a piece of string and an elastic band plus mounts and fixings.

    If I had had the equipment to construct the hinge I could have used a rotary
    potentiometer at the pivot point and dispensed with two nails, a piece of string
    and an elastic band.

    Whatever mechanical designs of the patented technology may have been innovative,
    those particular points were totally obvious to a fresh graduate with only
    high-school training in the relevant fields.

    Maybe I should have applied for a patent.

    [ Reply to This | # ]

    Software out by the backdoor, but is it right?
    Authored by: soronlin on Tuesday, May 01 2007 @ 07:56 AM EDT
    It seems to me that this decision significantly limits the patentability of software, in that it views only the physical embodiment of the software as having any relevance to the patent.

    That it restricts software patents is good.

    However software is not a physical object, and it behaves differently to physical objects. Until the law realises that and handles it specifically, the courts will have to produce these strange and convoluted decisions. I notice that although the Supreme Court distinguished the copying that occurred at the distributor, they did not distinguish the copying that occurred:-

    1. When Microsoft took one master disk and produced a master disk for each distributor.
    2. And/Or the several copies made by various Internet backbone machines when Microsoft emailed, or the distributors ftp'd the master disk.
    3. The several times the distributor probably copied the master disk between its various computer systems.
    4. The several copies made by the customer to the RAM disk buffers while installing the software.
    5. The persistent copy made of a possibly reduced and transformed copy of the software installed on the hard drive of the customer's computer.
    6. The several copies of the software made repeatedly and continuously in the RAM and cache memories when executing the program.
    In this case those copies were irrelevant. In future cases they may not be.

    [ Reply to This | # ]

    Comment about Knoppix CDs
    Authored by: Anonymous on Tuesday, May 01 2007 @ 08:14 AM EDT
    I agree with the Court that a component of a machine, whether a shrimp deveiner or a personal computer, must be something physical.... I agree with the Court that a set of instructions on how to build an infringing device, or even a template of the device, does not qualify as a component....To be sure, if these computers could not run Windows without inserting and keeping a CD- ROM in the appropriate drive, then the CD-ROMs might be components of the computer. But that is not the case here.

    And PJ wrote: Naturally, I think of Knoppix and other live CDs.

    I don't think this is very important. What this says: If I produce 10,000 Windows CDs in the USA which would infringe on US patents, and ship them to Europe where they are installed on 10,000 PCs, then those CDs are _not_ components of the computer. But if I produce 10,000 Knoppix CDs in the USA which would infringe on US patents, ship them to Europe, where they are used to boot 10,000 PCs, then those CDs _are_ components of those computers.

    So these Knoppix CDs would fall into the trap where components infringing on US patents, shipped outside the USA, are still infringing according to US law. This can be handled easily by shipping just one master CD, and making copies of it in Europe, and _never_ boot any PC in Europe from the master CD made in USA.

    [ Reply to This | # ]

    • Not... - Authored by: Anonymous on Tuesday, May 01 2007 @ 04:50 PM EDT
    ..the patent world as we know it has just changed.
    Authored by: DMF on Tuesday, May 01 2007 @ 02:19 PM EDT
    I'll believe it when I see it. SCOTUS has repeatedly ruled against the Patent
    Court, for all the good it's done. The problem is that they haven't been
    pro-active in following up. Maybe the best encouragement is that these cases
    were taken at all.

    [ Reply to This | # ]

    An expanded "poem"
    Authored by: cricketjeff on Wednesday, May 02 2007 @ 06:19 AM EDT
    I posted the first verses on another (member's only) thread but I have now expanded it to reflect this story. As usual you can read this on my site if you prefer, where you can tell me how bad it is by clicking on the stars. Copyright as per what it says there or on my other posted poems here.

    At the USPTO
    There are things they do not know
    And there are other things they always take on trust
    Because of things like these
    They've given monopolies
    On ideas so old they're turning into rust

    Now they've asked a little aid
    From folks who feel betrayed
    By an agency that just can't understand
    A community review
    Could show a thing or two
    About prior art and ideas old and bland

    So if your idea's old
    And your inventive spirit cold
    You may no longer have your dodgy patents granted
    And the ideas will remain
    In the public's own domain
    And inventors may no longer be supplanted

    The supreme court now says
    That these folk must mend their ways
    And obvious means just what we thought it meant
    For once sanity prevailed
    And the patent sharks have failed
    And to get a patent now you must invent!

    [ Reply to This | # ]

    Texas two-step
    Authored by: jo_dan_zukiger on Wednesday, May 02 2007 @ 10:43 AM EDT
    One step forward, one step back. It's a good dance if your primary intent is to

    spend time in the darking hugging your partner and not really going
    anywhere, of course.

    The court is correct in its assertion that software is not a device of the sort

    that should be patentable. (It's implicit in their opening arguments, yes.)

    Software is a mathematical (and therefore literary) expression of an abstract
    machine. But the patentable device does not exist until the software is loaded
    and running (or in runnable suspension) in a physical general purpose
    computer. The patentable device is the combination.

    The thing which would be patentable would be the combination of physical
    computer and software. In such a case, the infringer of the patent must be
    the end-user. The un-authorized provider of the software could be guilty of
    contributory infringement. (Another possible point of infringement might be
    in the production of the original un-authorized copy.)

    But the patent itself, in order to pass the test of not being too broad, must
    specify an awful lot about the software.

    A valid patent on an invention implemented in software should be required to
    be as specific in detail as a patent on the same invention implemented as a
    finite state machine. If it were implemented in levers and pulleys, the patent
    must diagram the the levers and pulleys. If implemented in logical gates, the
    diagram must specify the logical gates.

    If implemented in a programming language, a patent must be required
    specify the source code, or patents are simple the authorization of a return to

    the old systems of patronage.

    Human language alone (without diagrams) is not sufficient because human
    language is not precise. The general purpose computer cannot read the
    human language description and instantiate a non-trivial invention because
    of ambiguities in human language. (This is the mathematical way of
    describing one of the central reasons even non-obvious ideas and concepts,
    and even very complex algorithms and methods, were not originally intended
    to be patentable in the US. Ambiguity does not provide a good basis for legal
    interpretation.)

    Well, you might specify object code instead of source, but that would seem to
    be very disadvantageous to someone seeking the benefits of a patent.

    Also, the operating environment would have to be specified -- which
    systems, compilers, source language(s) libraries, etc., and which versions of
    all of that which the source code is intended or known to function on.
    (Testing, anyone?)

    But a patent that specific is not something that lends itself well to
    monetizable enforcement, I think. Too subject to workarounds. Copyright will
    yield a broader and more appropriate scope of interpretation.

    (One thing that needs to be visited more carefully relative to copyright and
    software and the GPL is public performance of a copyrighted work. Private
    karaoke should be fair use, of course, but a machine performing a work in
    public, say, on a publicly accessible server, could be as much under the
    requirements of copyright law as the distribution of the work.)

    But in the AT&T vs. Microsoft case here, the court has made an error, unless
    I
    misunderstand the golden masters Microsoft is using. The golden master can
    be used to boot a machine, right? Therefore, Microsoft is exporting a
    significant component of the covered invention. It would be the same as if
    Microsoft had manufactured an (infringing!) physical device in the US, taken it

    apart, and shipped the most important part abroad to be _copied_ there and
    assembled with parts made outside the US.

    If Microsoft's golden master were a source CD designed to synthesize OS CDs
    for the target market (language and locale, hardware, etc.), then the allegory
    used by the court might be more correct. Of course, especially with
    computers, the distinction between a template and a part seems to be
    arbitrary.

    I suppose I should go dig up that law and see what it might say about
    exporting machines intended to manufacture devices that would be infringing
    outside the US.

    Congress probably needs to re-write that law, whether to specifically include
    software or exclude it.

    Did AT&T's complaint deal with the infinging activity necessary to produce
    the original infringing device in the US? If I accepted the idea that AT&T
    should be able to patent their software, I'd have wanted the court to deal with

    the issue.

    So, yeah, anyway, copyrights for software.

    joudanzuki

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    Major reversal
    Authored by: overshoot on Thursday, May 03 2007 @ 10:48 AM EDT
    Thanks, Marbux.

    Marbux points out that the Teleflex ruling relies materially on the "To promote the progress of science and the useful arts" language of the Copyright Clause (patience.) I confess that that shocked me.

    The reason is that just a very few years ago in Eldred v. Ashcroft, the Court dismissed all arguments regarding those same few words on the grounds that they were, in effect, a rhetorical decoration for the meat of the Clause which starts with "Congress shall."

    Now, the chances of the Court granting cert to revisit Eldred is not quite as good as that of a July snowstorm in Phoenix, but such strikingly different reasoning in two major cases so close together implies that something major has happened on the Court.

    I'd love to see some discussion on this point -- too bad this topic has scrolled down from the top.

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    A "Hack" of the MS vs. ATT
    Authored by: maz2331 on Thursday, May 03 2007 @ 01:04 PM EDT
    Since the court ruled that no infringement occurs for copies installed and
    running overseas, would it be possible for, say MS to leave the code out of the
    copies installed in the USA and interface with it via the Internet to a server
    running in a foriegn country?

    For example, if the patented code performed a function where it took text data
    in and returned an audio stream, if MS sent the text to a foriegn server running
    that function and then recieved the output from the net, (say, via some form of
    Remote Procedure Call) would any infringement occur since the patented
    "component" is never physically embodied in any machine located in the
    USA?

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