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Red Hat Makes History With Patent Settlement - Compatible with GPLv3
Wednesday, June 11 2008 @ 07:42 PM EDT

You've probably been wondering why I've been quiet, when there is news about a patent settlement between Red Hat and Firestar and DataTern in the JBoss litigation. It's because I wanted to be positive I was correct that this is the first known settlement involving patents that is harmonious with GPLv3. It is.

It's also harmonious with GPLv2, of course, but this is history in the making, friends. They settled a lawsuit brought against them in a way that licenses patents without violating the GPL. I'll show you how, but first, so you know I'm not just dreaming, here's the answer I got from Richard Fontana, Open Source Licensing and Patent Counsel, Red Hat, to my question about whether this is the first known GPLv3 patent agreement that works:

Most patent settlements and similar agreements are confidential, but to my knowledge this is the first patent settlement that satisfies the requirements of GPL version 3. Indeed, it really goes further than GPLv3 in the degree to which upstream and downstream parties receive safety from the patents at issue here. (And this is not a case of trying to find a loophole in the GPL, but rather a desire on our part to reach an agreement that provided broad patent protection for developers, distributors and users, while complying fully with the conditions of the licenses of the software we and our community distribute.)

You know what this means? It means that those who claim the GPL isolates itself from standards bodies' IP pledges are wrong. It *is* possible to come up with language that satisfies the GPL and still acknowledges patents, and this is the proof. That means Microsoft could do it for OOXML if it wanted to. So who is isolating whom? Thank you, Red Hat, for innovating again to protect the FOSS community.

Here's what Eben Moglen says about the agreement:

"Red Hat's settlement of outstanding patent litigation on terms that provide additional protection to other members of the community upstream and downstream from Red Hat is a positive contribution to the resources for community patent defense. We would hope to see more settlements of this kind--in which parties secure more than their own particular legal advantage in relation to the third-party patent risk of the whole FOSS community--when commercial redistributors of FOSS choose to settle patent litigation. SFLC welcomes Red Hat's efforts on the community's behalf."

This is what Novell could have done, I would suggest, and when their 5-year indentured labor contract is over, so to speak, I hope they will. The main point is this: Microsoft, Ecma, ISO, are you paying attention? It can be done. It's been done. Now, the ball is in your court. There is no legal reason why the GPL has to be excluded from patent agreements.

OK. How'd they do it? Of course, the actual terms are not available, but here is the concept: you can have patent agreements, so long as the terms do not conflict or add any new restrictions.

For example, here's the patent wording in GPLv2:

7. If, as a consequence of a court judgment or allegation of patent infringement or for any other reason (not limited to patent issues), conditions are imposed on you (whether by court order, agreement or otherwise) that contradict the conditions of this License, they do not excuse you from the conditions of this License. If you cannot distribute so as to satisfy simultaneously your obligations under this License and any other pertinent obligations, then as a consequence you may not distribute the Program at all. For example, if a patent license would not permit royalty-free redistribution of the Program by all those who receive copies directly or indirectly through you, then the only way you could satisfy both it and this License would be to refrain entirely from distribution of the Program.

If any portion of this section is held invalid or unenforceable under any particular circumstance, the balance of the section is intended to apply and the section as a whole is intended to apply in other circumstances.

It is not the purpose of this section to induce you to infringe any patents or other property right claims or to contest validity of any such claims; this section has the sole purpose of protecting the integrity of the free software distribution system, which is implemented by public license practices. Many people have made generous contributions to the wide range of software distributed through that system in reliance on consistent application of that system; it is up to the author/donor to decide if he or she is willing to distribute software through any other system and a licensee cannot impose that choice.

This section is intended to make thoroughly clear what is believed to be a consequence of the rest of this License.

See? You can settle patent litigation or whatever, so long as you don't violate the terms of the GPL. And from this day forward, no one can say it can't be done with the GPL. Red Hat just did it.

OK. But what about GPLv3? That's anti-patents, right? Well, not so fast. Of course, software patents are a hindrance to innovation and directly conflict with the Open Source development model, but one of the purposes of doing a revision of the GPL was to make it more business-usable. Surprised? It's true.

So let's look at the terms of the GPLv3 regarding patents:

10. Automatic Licensing of Downstream Recipients.

Each time you convey a covered work, the recipient automatically receives a license from the original licensors, to run, modify and propagate that work, subject to this License. You are not responsible for enforcing compliance by third parties with this License.

An “entity transaction” is a transaction transferring control of an organization, or substantially all assets of one, or subdividing an organization, or merging organizations. If propagation of a covered work results from an entity transaction, each party to that transaction who receives a copy of the work also receives whatever licenses to the work the party's predecessor in interest had or could give under the previous paragraph, plus a right to possession of the Corresponding Source of the work from the predecessor in interest, if the predecessor has it or can get it with reasonable efforts.

You may not impose any further restrictions on the exercise of the rights granted or affirmed under this License. For example, you may not impose a license fee, royalty, or other charge for exercise of rights granted under this License, and you may not initiate litigation (including a cross-claim or counterclaim in a lawsuit) alleging that any patent claim is infringed by making, using, selling, offering for sale, or importing the Program or any portion of it.

11. Patents.

A “contributor” is a copyright holder who authorizes use under this License of the Program or a work on which the Program is based. The work thus licensed is called the contributor's “contributor version”.

A contributor's “essential patent claims” are all patent claims owned or controlled by the contributor, whether already acquired or hereafter acquired, that would be infringed by some manner, permitted by this License, of making, using, or selling its contributor version, but do not include claims that would be infringed only as a consequence of further modification of the contributor version. For purposes of this definition, “control” includes the right to grant patent sublicenses in a manner consistent with the requirements of this License.

Each contributor grants you a non-exclusive, worldwide, royalty-free patent license under the contributor's essential patent claims, to make, use, sell, offer for sale, import and otherwise run, modify and propagate the contents of its contributor version.

In the following three paragraphs, a “patent license” is any express agreement or commitment, however denominated, not to enforce a patent (such as an express permission to practice a patent or covenant not to sue for patent infringement). To “grant” such a patent license to a party means to make such an agreement or commitment not to enforce a patent against the party.

If you convey a covered work, knowingly relying on a patent license, and the Corresponding Source of the work is not available for anyone to copy, free of charge and under the terms of this License, through a publicly available network server or other readily accessible means, then you must either (1) cause the Corresponding Source to be so available, or (2) arrange to deprive yourself of the benefit of the patent license for this particular work, or (3) arrange, in a manner consistent with the requirements of this License, to extend the patent license to downstream recipients. “Knowingly relying” means you have actual knowledge that, but for the patent license, your conveying the covered work in a country, or your recipient's use of the covered work in a country, would infringe one or more identifiable patents in that country that you have reason to believe are valid.

If, pursuant to or in connection with a single transaction or arrangement, you convey, or propagate by procuring conveyance of, a covered work, and grant a patent license to some of the parties receiving the covered work authorizing them to use, propagate, modify or convey a specific copy of the covered work, then the patent license you grant is automatically extended to all recipients of the covered work and works based on it.

A patent license is “discriminatory” if it does not include within the scope of its coverage, prohibits the exercise of, or is conditioned on the non-exercise of one or more of the rights that are specifically granted under this License. You may not convey a covered work if you are a party to an arrangement with a third party that is in the business of distributing software, under which you make payment to the third party based on the extent of your activity of conveying the work, and under which the third party grants, to any of the parties who would receive the covered work from you, a discriminatory patent license (a) in connection with copies of the covered work conveyed by you (or copies made from those copies), or (b) primarily for and in connection with specific products or compilations that contain the covered work, unless you entered into that arrangement, or that patent license was granted, prior to 28 March 2007.

Nothing in this License shall be construed as excluding or limiting any implied license or other defenses to infringement that may otherwise be available to you under applicable patent law.

See? If you protect essential terms of the GPL, you can still settle a patent litigation lawsuit, pay for a license, etc., just as you normally would. That is what Red Hat did. In the press release, note what they accomplished:

Red Hat, Inc. (NYSE: RHT), the world's leading provider of open source solutions, today announced the settlement of patent litigation involving Firestar Software, Inc. and DataTern, Inc. The settlement protects Red Hat's customers and the open source community from similar suits and sets an important precedent in the breadth of protection for the open source community.

Red Hat was sued for patent infringement by Firestar in 2006 and later by DataTern. Red Hat denied the infringement claims and in time drove a settlement that not only ended the particular claims against it, but also provided for extensive protections for its customers and the larger open source community that Red Hat relies upon.

"Typically when a company settles a patent lawsuit, it focuses on getting safety for itself," said Rob Tiller, Vice President and Assistant General Counsel, IP. "But that was not enough for us, we wanted broad provisions that covered our customers, who place trust in us, and the open source community, whose considerable efforts benefit our business."

The covered products include all software distributed under Red Hat's brands, as well as upstream predecessor versions. The settlement also protects derivative works of, or combination products using, the covered products from any patent claim based in any respect on the covered products. Essentially, all that have innovated to create, or that will innovate with, software distributed under Red Hat brands are protected, as are Red Hat customers.

"Red Hat's settlement satisfies the most stringent patent provisions in open source licenses, is consistent with the letter and spirit of all versions of the GPL and provides patent safety for developers, distributors and users of open source software," said Richard Fontana, Open Source Licensing and Patent Counsel at Red Hat.

Paul Frields, Fedora Project Leader noted that, "Through the coverage of both upstream and downstream developers and distributors in the settlement, the Fedora community (and others) are given protection that builds on the assurances that Red Hat already offers. Given the software patent world in which we must operate, this is a good day for the Fedora global community."

Red Hat has consistently maintained that software patents impede innovation in the software industry and conflict with open source development and distribution. Open source requires transparency that allows members of the community to use, modify and share software with one another without constraint. Through its Open Source Assurance program, Red Hat provides open source intellectual property protections that protect its customers and encourages them to deploy with confidence. The program provides assurances for customers that cover Red Hat-branded subscription products and also provides indemnification protection.

So. A very big day.

By the way, it's also an interesting case, and you can read the Red Hat Answer to the plaintiffs' 3rd Amended Complaint [PDF] if you want to see how prior art searching results get used in litigation, starting particularly on page 12.


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