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Some Amicus Briefs in Support of Microsoft in the i4i Case - Google's as text - Updated 2Xs
Friday, October 01 2010 @ 07:02 AM EDT

Now I've seen everything. Wal-Mart is telling the US Supreme Court in an amicus brief that the US patent system is irrational and unfair. And it points the finger of blame straight at the Federal Circuit.

Can change in the patent system be far away *now*?

Seriously, Google, Verizon, Dell, HP, HTC, and Wal-Mart, if you can believe it, have together filed an amicus brief [PDF] in support of Microsoft's petition for writ of certiorari [PDF] in the i4i patent litigation case Microsoft lost both at the District Court level and on appeal to the Federal Circuit. HP and Dell submitted amicus briefs before in support of Microsoft, back when the case was being appealed to the Federal Circuit, but after Microsoft lost again there, the crowd in support has grown. And they all give the court an earful about just how messed up the patent system has become.

It's a new day, ladies and gentlemen, when Wal-Mart gets it that the patent system is destructive to business and destroying innovation. A number of others have also filed amicus briefs, including EFF together with the Apache Software Foundation, Public Knowledge, and the Computer & Communications Industry Association. You can find more amicus briefs in Nick Eaton's article in the San Francisco Chronicle, but I thought you'd particularly like to see the Google brief, so I've done it as text, because Google uses the same firm that represents them against Oracle in the patent litigation regarding Java and Android, King & Spalding.

How in the world did Wal-Mart get into this group? I don't know. One of the lawyers at Google knows one of the lawyers at Wal-Mart, maybe, just like they probably now know folks at Verizon. Something like that anyway, as it's a grouping that seems new and different. What they tell the court is that everything tilts unfairly toward a patent-holder, even when it's inappropriate. And exactly when is it appropriate in civil litigation for either side to be favored, they inquire?

The USPTO is already "skewed heavily in favor of issuing patents," they write. Add on to that a presumption that the PTO examiner got it right, which they often do not, judging by litigation outcomes or even the PTO's own review process results, and then add the cherry on top -- the Federal Circuit's heightened burden of proof of invalidity -- and it's not a fair system:

The clear-and-convincing-evidence standard serves only to tilt the playing field even further in favor of patent holders, contrary to general principles of law, the realities of the PTO's processes, and the public interest in a balanced patent system.
By heightened, they mean this: a registered copyright is presumed valid, but you can prove otherwise with a preponderance of evidence. Ditto a trademark. So why shouldn't patents also be in that same category, where a preponderance of evidence is sufficient to overcome validity? Congress didn't say it should be this way, this high a standard, so there's "no reason to adopt a burden of proof that favors one side over the other, absent express statutory language requiring that result."

Another amicus brief [PDF] filed by a large group of law professors (including, I notice, Professor Daniel B. Ravicher Cardozo Law School Yeshiva University), and represented by Mark A. Lemley at Stanford Law School, states the problem it would like the Supreme Court to fix in rather plain language:

Deference to previous decisions is appropriate in instances where those previous decisions have a high likelihood of being accurate. But the initial process of patent review today is, unavoidably, often an inaccurate signal. Put bluntly, PTO review is not always reliable and is unlikely to become so.

Before the creation of the Federal Circuit in 1982, all regional circuits recognized the limitations of evaluation by the PTO in one important situation: where the PTO had not had an opportunity to review the evidence in question at all. But for nearly thirty years, the Federal Circuit has required proof of invalidity by clear and convincing evidence even when, as in this case, the evidence in question was never before the PTO.

In KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398 (2007), this Court took the unusual step of raising the issue of appropriate deference in its opinion even though it was not briefed in that case. The Court “th[ought] it appropriate to note that the rationale underlying the presumption – that the PTO, in its expertise, has approved the claim – seems much diminished here” because the PTO did not have the relevant evidence before it. Id. at 426. Notwithstanding that clear signal, the Federal Circuit has steadfastly hewed to the uniform rule it created, even in circumstances in which that rule makes no sense. This Court should grant the petition for certiorari to do what the Federal Circuit will not – apply a legal standard for the presumption of validity that reflects the realities of the modern patent system.

Microsoft presented prior art in court, prior art that the USPTO examiner had not seen or considered, but because of the deference to the examiner, it did them no good. Hence the appeal, or the hope of one anyway, to the US Supreme Court, asking that court to spank the Federal Circuit or at least make it stop. No one else can.

Evidently, the i4i case has opened some eyes. It doesn't bother Microsoft that the patent system is unfair when it is threatening Linux, I notice. And i4i's patent is regarding XML, and Microsoft has XML patents itself, which I expect it wouldn't hesitate to use if it felt like it. But as I've told you before, legal questions are what you look at, not who the parties are. And post-i4i, I gather Microsoft sees the point now with intense clarity, now that it's on the receiving end, that the patent system isn't fair to defendants.

Actually, who doesn't see it now? And yet, old ways persist. As Supreme Court Justice Ruth Bader Ginsburg said recently, “It takes time to break old ways of thinking."

Meanwhile, a lot of damage is being done. Google et al tell the Supreme Court:

Abusive patent suits based on invalid patents have powerful coercive effects and are a scourge of modern business.
Indeed. I think they've misdiagnosed the problem, of course, to the extent that they mention patent trolls as a problem for buying and using patents in litigation without innovating themselves. I think the problem is much more fundamental -- that software shouldn't be patented in the first place by anybody, because software is math, abstract, and therefore should not be patentable. That would cut patent trolls off at the pass. But the amici don't go that far. They want patent trolls to have a steeper hill to climb, while presumably keeping the "good" patents. Meaning the ones they own, I'm guessing. But FOSS has to deal with trolls too, and everything that makes the process better helps. The education the briefs provide the court is valuable, in that they tell the court specifically what is wrong with a system that tilts so heavily in favor of patent owners, whether the patent is valid or not, telling the court that it's extremely hard to disprove the validity of even wrongfully issued patents:
Under ordinary principles of law, the PTO's unbalanced and incomplete review of patent applications is not entitled to deference....

Indeed, under general principles of administrative law, an agency commits reversible error when it fails to consider an important aspect of the problem before it. Motor Vehicles, 463 U.S. at 43. For practical reasons, as discussed above, the PTO's institutionalized procedures encourage examiners not to consider all requirements for validity. For the courts to give a heightened presumption of validity to patents issued by that process would turn basic administrative law principles on their head.

My. You don't see that every day in briefs heading to the US Supreme Court.

Yet another brief [PDF], this one by the Securities Industry and Financial Markets Association and the Clearing House Association, says the financial services industry is threatened by patents:

If the financial services industry continues to be burdened with a high evidentiary standard in invalidating such patents, the expense of defending such suits and the risk of losing despite a lengthy and costly litigation battle will likely stifle financial services industry innovation, which is to the detriment of everyone.

It is estimated that the cost of defending a patent dispute is minimally $1.5 million and may be greater than $4 million for each defendant. Steve Bills, The Tech Scene: Patent Case Settlements: Economics or Endgame? TECHNOLOGY, Vol. 173, No. 177, at 1 (Sept. 2008). Controlling costs is a vital component of innovation for the financial services industry where a lapse can have far-ranging implications. The financial services industry cannot continue to be placed in the position of having to engage in or settle frivolous patent disputes due to the risk of not being able to clear the hurdle represented by a clear and convincing standard when the patent may never have issued in the first place had the Examiner seen what is often the most relevant evidence....

The purpose of the patent system is to promote innovation, not to invite catastrophe or to encourage holders of questionable patents to turn an easy dollar. Leveling the playing field by reestablishing “preponderance of the evidence” as the standard of proof for prior art that was never before the Examiner will go a long way toward properly limiting risks to the financial services industry that otherwise could have a global impact.

The one you will like the most, I suspect, is the one by EFF and the Apache guys [PDF], because they highlight the extra burden on software, but you'll have to read it in the PDF, because if I try to copy and paste, it all looks like this:
6JJ"Q??=G$ >"$ JBQGH?>G$ >"$ KDBJJ==G$ BGG
Stupidly annoying. And I don't have time to hand type it for you. But they make three points: 1) a larger proportion of patent litigation is now about software and computer-related patents, which means the harm is disproportionately greater for Free and Open Source Software projects, which tend to be individuals, not corporate entities, without litigation budgets; 2) the heightened standard of proof is hard for FOSS, because plaintiffs often argue that you have to use the source code of the prior art product to prove a software patent invalid, and FOSS isn't organized to save all that evidence; and 3) the statute doesn't contain the Federal Circuit's enhanced standard of proof.

Update: I see some comments once again saying that if software is math, so is hardware. However, the difference is that hardware isn't *just* math. And a lucid comment provides an illustration, taking it one more step:

No. Hardware is not math.

I've used this example before, and I'll use it again here.

Picture software which completely models the physical processes involved in a lit candle. (This is math, and nothing but math.) Run that software.

Do you have a candle? No.

Do you have flame? No.

Do you have heat? No.

Now, take a candle. Light it.

Does it require math to burn a candle? No.

Math can *model* the physical universe, but it cannot *be* the physical universe. That model is not the physical object though. That's the difference.

Update 2: Patently O has a brief description of all the amicus briefs in the article titled Challenging the Clear and Convincing Standard of Proof for Invalidating Patents in Court, and I'll just briefly highlight here the ones not covered in my article. He also explains a bit about the history of the case, and he has some news:
Eleven parties have filed amicus briefs supporting the petition for certiorari. Microsoft's counsel makes the point that the companies signing in their own name “employ more than three million people and the publicly-traded companies have a combined market capitalization of more than $1.2 trillion.” Briefs opposing the petition as well as i4i's opposition appear to be due on October 29, 2010.

Chief Judge Roberts has recused himself from the case.

A review of the briefs follow. Many of the briefs cover similar material and I have attempted to point out some of the differences. Of course, all of these briefs listed argue that the current evidentiary standard is too-high....

Brief by Acushnet, SAP, and Others: James Dabney and John Duffy collaborated to examine the history of invalidity defenses. The brief does an especially good job of spelling out different aspects of an invalidity argument that may need a higher standard of proof....

Teva, Cisco, and the Generic Pharma Association: ... The cost of invalidating a patent is so high that a patentee can usually obtain significant settlements even for a patent that should have never issued....

Yahoo!: “In requiring clear and convincing proof of facts bearing on patent invalidity, the Federal Circuit’s rule conflicts with this Court’s teaching that a heightened evidentiary standard should not apply where a statute does not prescribe the heightened standard.”

Intel: We have “a thicket of invalid patents that stifles competition and impedes further innovation.”...

Facebook, Netflix, et al.:...To harmonize with the reexamination statute, court's should at least lower the threshold for proving invalidity once a substantial new question of patentability is established....

Apple: ...”The clear and convincing standard shields a growing number of poor quality patents from the truthseeking function of our adversarial system.”

CTIA – The Wireless Association: The clear and convincing standard makes a difference in litigation — making it much more likely that a patent will survive validity attacks. This reality has created practical problems in dealing with holders of low-quality patents who seek large damage awards.

He has more analysis and all the documents there on Patently O.

And with that, here's the Google brief, as text, minus the cases and statutes, which you will need to get from the PDF (updated - a kind soul has done the EFF/Apache brief as text for us, so I've added it after the double row of stars, after the Google brief, and I see our friend Larry Rosen was representing the Apache Foundation in this matter:

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

NO. 10-290

________________________

In the

Supreme Court of the United States

________________

MICROSOFT CORPORATION,
Petitioner,

v.

I4I LIMITED PARTNERSHIP AND
INFRASTRUCTURES FOR INFORMATION INC.,
Respondents.

________________

On Petition for a Writ of Certiorari to the
United States Court of Appeals
for the Federal Circuit

________________

BRIEF OF GOOGLE INC., VERIZON COMMUNICATIONS
INC., DELL COMPUTER CORP., HEWLETT-PACKARD CO.,
HTC CORP., AND WAL-MART STORES, INC. AS AMICI
CURIAE
IN SUPPORT OF PETITIONER

________________

PAUL D. CLEMENT
Counsel of Record
DARYL JOSEFFER
ADAM CONRAD
KING & SPALDING LLP
[address, phone]
Counsel for Amici Curiae

JOHN THORNE
GAIL F. LEVINE
VERIZON
COMMUNICATIONS INC.
[address, phone]
Counsel for Verizon Communications Inc.

MICHELLE K. LEE
CATHERINE C. LACAVERA
TIMOTHY A. PORTER
JOHN L. LABARRE
GOOGLE INC.
[address, phone]
Counsel for Google Inc.

September 29, 2010

__________________________

Additional counsel:

PAUL H. ROEDER
HEWLETT-PACKARD CO.
[address, phone]
Counsel for Hewlett-Packard Co.

QUESTION PRESENTED

Whether a party disputing a patent's validity must prove invalidity by clear and convincing evidence.

i

TABLE OF CONTENTS

TABLE OF AUTHORITIES....................................... iv

INTEREST OF AMICI CURIAE ................................ 1

INTRODUCTION AND SUMMARY OF ARGUMENT................................................ 2

ARGUMENT ....................................................... 4

I. The Federal Circuit's Application Of The
Clear-And-Convincing-Evidence Standard
Puts Patent Law At Odds With Ordinary
Principles Of Law ................................... 4

A. The Patent Act Does Not Require A
Heightened Standard Of Proof...................... 5

B. The Nature Of The Patent Right Does
Not Warrant A Heightened Standard Of Proof ........................................ 7

II. Deference To The PTO's Expertise Does
Not Warrant A Heightened Burden Of
Proof ................................................ 9
A. Federal Circuit Law And PTO
Practice Tilt The Scales Heavily In
Favor Of Granting Patent
Applications ..................................... 9

B. The PTO's Grant Of A Patent Should
Not Receive Deference Under
Ordinary Principles Of
Administrative Law .............................. 15

C. A Heightened Burden Of Proof Only
Enhances Lay Juries' Tendency To

ii

Defer Excessively To The PTO's
Issuance Of A Patent ........................... 20
III. This Court's Precedents Do Not Require A
Heightened Burden Of Proof.............................. 22

CONCLUSION .............................................. 25

iii

TABLE OF AUTHORITIES, STATUTES, OTHER AUTHORITIES

[SEE PDF]

iv-x

INTEREST OF AMICI CURIAE1

Amici include innovative leaders in the high-technology and computer-related fields. Having obtained a number of patents based on their own extensive research and development efforts, and having also been unfairly and repeatedly accused of infringing others' patented technology, amici have a strong interest in a fair and balanced patent system that rewards rather than impedes actual innovation. Amicus Wal-Mart Stores, Inc., one of the world's largest retailers, has a similar interest because it sells over 100,000 products that high-technology and other companies manufacture and provide to it.

All too often, the requirement that a party prove a patent's invalidity by clear and convincing evidence skews the inquiry and causes courts and juries to sustain invalid patents. Amici provide or sell products and services incorporating large numbers of components that can and do generate numerous allegations of patent infringement. Those allegations are often based on invalid patents, but they are nonetheless costly and risky to defend, in part because of the clear-and-convincing-evidence standard. Those costs and risks often give issued patents a significant

2

settlement value even when they are invalid--a reality that encourages the filing of abusive patent suits and ultimately discourages and penalizes actual innovation while increasing the cost of goods and services without any corresponding value to the consumer.

INTRODUCTION AND
SUMMARY OF ARGUMENT

1. In private civil litigation, a preponderance of the evidence is the default burden of proof. Because the Federal Circuit's clear-and-convincing-evidence requirement departs from that general principle of law without any basis in the text of the patent statute, this Court should grant review and re-affirm that the same principles of law that apply in all other areas of law also apply in patent cases.

Policy arguments alone cannot overcome the law's default presumption that the standard of proof in private civil litigation is a preponderance. Nonetheless, it bears emphasis that the clear-and-convincing standard does not advance the broad purposes of the Patent Act. That Act seeks to strike a balance between two objectives: rewarding genuine innovators with exclusive property rights, but not deterring innovation by granting such rights for subject matter that does not deserve them. Especially in light of that balance, there is no reason to adopt a heightened burden of proof that favors one private litigant over another.

2. It is no answer that the Patent Act states that patents are presumed to be valid. Outside of patent law, such statutory presumptions are

3

routinely governed by the preponderance-of-the-evidence standard, not a heightened one.

Nor is a heightened standard justified by notions of deference to the Patent and Trademark Office's ("PTO's") issuance of a patent. Deference to agency action is generally governed by the substantive standards of review set forth in the Administrative Procedures Act, 5 U.S.C. § 501 et seq. ("APA"), not by ad hoc impositions of heightened burdens of proof. Moreover, a proper understanding of the PTO's role in issuing a patent shows that deference notions are misplaced.

The PTO itself presumes that all patent applications should be granted, and therefore permits a patent examiner to reject an application only if the examiner demonstrates invalidity. The examiner bears that burden as part of an ex parte procedure that generally relies on the applicant's disclosures and the examiner's own research -- research that is greatly limited because of the extreme time pressures that workload demands impose on examiners. Moreover, examiners are not expected to consider all of the requirements for patentability, in part because it is impractical to consider some of them as part of the ex parte examination process.

Against that backdrop, deference is unwarranted under settled principles of administrative law. First, in part because of severe constraints on the PTO's resources, the PTO's ex parte consideration is too incomplete to warrant deference.

First, in part because of severe constraints on the PTO’s resources, the PTO’s ex parte consideration is too incomplete to warrant deference. Second, the PTO’s procedures are skewed heavily in favor of issuing patents. Third,

4

established administrative-law principles do not support deferring to a result -- the PTO's issuance of a patent -- without regard to whether the agency's actual reasoning is sustainable, which is the traditional focus of judicial review of agency action.

3. Even without the clear-and-convincing-evidence standard, juries take the presumption of validity very seriously and are extremely reluctant to second-guess the PTO's determination. The clear-and-convincing-evidence standard serves only to tilt the playing field even further in favor of patent holders, contrary to general principles of law, the realities of the PTO's processes, and the public interest in a balanced patent system.

ARGUMENT

I. The Federal Circuit's Application Of The Clear-And-Convincing-Evidence Standard Puts Patent Law At Odds With Ordinary Principles Of Law.

General principles of law that apply in all other contexts also govern in patent cases. See, e.g., MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118 (2007) (declaratory judgment standard); eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2006) (permanent injunction standard); Dickinson v. Zurko, 527 U.S. 150, 165 (1999) (standard of review of agency action). There is little doubt about the applicable general principles here: in civil suits, the party that bears the burden of proof may overcome that burden with a preponderance of the evidence, unless Congress expressly requires a higher standard or certain important liberty interests are at stake. See, e.g., Grogan v. Garner, 498 U.S. 279, 286 (1991). Neither of those

5

exceptions even arguably applies here. Just like the normal principles of law at issue in eBay, MedImmune, and Zurko, normal burdens of proof also apply in patent cases.

A. The Patent Act Does Not Require A
Heightened Standard Of Proof.

Nothing in the Patent Act requires a heightened burden of proof for invalidity. The Act simply states that "[a] patent shall be presumed valid. . . . The burden of establishing invalidity of a patent or any claim thereof shall rest on the party asserting such invalidity." 35 U.S.C. § 282. While that statute identifies who bears the burden of proof on invalidity, it says nothing about the evidentiary standard for carrying that burden. As explained above, the default preponderance-of-the-evidence standard therefore applies.

It is no answer that the statute also establishes a presumption of validity. Such presumptions do not affect the burden of proof, only the initial burden of production, which is not at issue here. Fed. R. Evid. 301. Indeed, all agency decisions are "entitled to a presumption of regularity." Citizens to Pres. Overton Park, Inc. v. Volpe, 401 U.S. 402, 415 (1971); see also Stuart Minor Benjamin & Arti K. Rai, Who's Afraid of the APA? What the Patent System Can Learn from Administrative Law, 95 Geo. L. Rev. 269, 281 n.53 (2007) (citing cases). But that does not mean that they must all be overcome by clear and convincing evidence.

To the contrary, numerous statutory presumptions -- including the presumptions of validity for copyrights and trademarks -- are

6

overcome by a preponderance of the evidence. See, e.g., Medforms, Inc. v. Healthcare Mgmt. Solutions, Inc., 290 F.3d 98, 114 (2d Cir. 2002) (copyright); Material Supply Int'l, Inc. v. Sunmatch Indus. Co., 146 F.3d 983, 990 (D.C. Cir. 1998) (trademark); Bracic v. Holder, 603 F.3d 1027, 1034 (8th Cir. 2010) (fear of persecution in asylum proceedings). Even the Federal Circuit has applied that default rule to statutory presumptions outside the context of patent law. See St. Paul Fire & Marine Ins. Co. v. United States, 6 F.3d 763, 768-69 (Fed. Cir. 1993) (presumption that decisions of the Customs Service are correct); Thomas v. Nicholson, 423 F.3d 1279, 1282 (Fed. Cir. 2005) ("presumption of service connection for [veterans'] injuries that occur during active duty").

Here, as in eBay, "[n]othing in the Patent Act indicates that Congress intended . . . a departure" from traditional principles. eBay, 547 U.S. at 391-92. When Congress intended to impose a clear-and-convincing evidentiary burden in the Patent Act, it knew how to do so: "A person asserting the defense under this section [concerning prior uses of business methods] shall have the burden of establishing the defense by clear and convincing evidence." 35 U.S.C. § 273(b)(4). Congress's specification of the clear-and-convincing-evidence standard for that one defense, coupled with its silence on that issue elsewhere, provides strong evidence that Congress did not intend to require a heightened burden of proof for other issues, including invalidity. See Barnhart v. Sigmon Coal Co., 534 U.S. 438, 452 (2002).

7

Nor does the legislative history express any intent to deviate from traditional principles; the committee reports do not even mention evidentiary burdens. See H.R. Rep. No. 82-1923, at 10 (1952); S. Rep. No. 82-1979 (1952). Congress's "silence is inconsistent with the view that Congress intended to require a special, heightened standard of proof." Grogan, 498 U.S. at 286.

B. The Nature Of The Patent Right Does Not
Warrant A Heightened Standard Of Proof.

Absent explicit congressional direction, this Court has permitted deviations from the baseline preponderance standard only where interests unlike those implicated by patent rights are at stake. See id. Because the potential loss of liberty is "more substantial than mere loss of money," "[t]he individual should not be asked to share equally with society the risk of error" in such cases, Addington v. Texas, 441 U.S. 418, 424, 427 (1979), which include civil confinement, id. at 432-33; denaturalization, Schneiderman v. United States, 320 U.S. 118 (1943); deportation, Woodby v. INS, 385 U.S. 276 (1966); and loss of parental rights, Santosky v. Kramer, 455 U.S. 745 (1982).

In contrast, private patent litigation involves the same types of economic injuries that are at issue in "the typical civil case involving a monetary dispute between private parties." Addington, 441 U.S. at 423. See eBay, 547 U.S. at 391 (money damages are the norm in patent litigation absent irreparable injury because "familiar principles apply with equal force to disputes arising under the Patent Act"). With respect to such injuries, there is

8

no reason to adopt a burden of proof that favors one side over the other, absent express statutory language requiring that result.

To be sure, society has an interest in a well functioning patent system. But the public interest is in a balanced patent system that rewards genuine innovation with exclusive patent rights without impeding innovation by granting such rights to applicants that did not innovate. Bonito Boats, Inc. v. Thunder Craft Boats, Inc., 489 U.S. 141 (1989). As this Court recently emphasized, invalid patents "stifle, rather than promote, the progress of useful arts." KSR Int'l Co. v. Teleflex, Inc., 550 U.S. 398, 427 (2007). Thus, "the strong federal policy favor[s] free competition in ideas which do not merit patent protection." Lear, Inc. v. Adkins, 395 U.S. 653, 656 (1969).

Abusive patent suits based on invalid patents have powerful coercive effects and are a scourge of modern business. See eBay, 547 U.S. at 396 (Kennedy, J., concurring). That problem has become far worse in recent years as "non-practicing entities" have bought up questionable patents for the sole purpose of asserting them in litigation. See, e.g., Patent Trolls: Fact or Fiction?, Hearing Before the Subcomm. on Courts, the Internet, & Intellectual Property of the House Comm. on the Judiciary, 109th Cong. 2-3 (2006) (statement of Rep. Berman). And the most dubious patents benefit the most from the added protection of the clear-and-convincing-evidence standard. Nothing about the patent right warrants judicial imposition of a standard of proof that favors patent holders

9

over other entities that are attempting to innovate and compete.

II. Deference To The PTO's Expertise Does Not Warrant A Heightened Burden Of Proof.

The Federal Circuit has treated its clear-and-convincing-evidence requirement as a means of deferring to the PTO's issuance of a patent. See Am. Hoist & Derrick, Co. v. Sowa & Sons, Inc., 725 F.2d 1350, 1359 (Fed. Cir. 1984). That mixes apples with oranges. The Administrative Procedures Act generally governs deference to administrative agencies, including the PTO. Zurko, 527 U.S. at 152-154. The APA nowhere relies on the burden of proof for deference; instead, it requires a party challenging agency action to satisfy certain substantive standards by showing that agency action is, for example, contrary to law or arbitrary and capricious. See 5 U.S.C. § 706. The Federal Circuit's use of a heightened burden of proof as a deference doctrine is more than just a category mismatch; it obscures the fact that under traditional deference principles, the PTO's issuance of a patent is not entitled to any deference -- much less the strong deference the Federal Circuit accords it.

A. Federal Circuit Law And PTO Practice Tilt
The Scales Heavily In Favor Of Granting
Patent Applications.
Deference turns not on whether the PTO is "do[ing] its job," Am. Hoist & Derrick, 725 F.2d at 1359, which it is, but on whether the job the PTO's examiners are tasked with doing is the kind that warrants deference. As the Federal Trade

10

Commission ("FTC") has determined, current law and PTO procedure stack the deck heavily in favor of issuing patents. See FTC, To Promote Innovation: The Proper Balance of Competition and Patent Law and Policy, Executive Summary at 9 (2003), available at http://www.ftc.gov/os/2003/10/ innovationrpt.pdf ("FTC Report"). Under ordinary principles of law, the PTO's unbalanced and incomplete review of patent applications is not entitled to deference.

1. Ordinarily, an applicant bears the burden of proving its entitlement to a government benefit or privilege. See, e.g., Fagan v. Shinseki, 573 F.3d 1282, 1286 (Fed. Cir. 2009). But under Federal Circuit precedent, patent prosecution takes the opposite approach: the patent examiner "bears the initial burden, on review of the prior art or on any other ground, of presenting a prima facie case of unpatentability." In re Oetiker, 977 F.2d 1443, 1445 (Fed. Cir. 1992); see also Manual of Patent Examining Procedure § 716.01(d) ("MPEP").

In other words, the PTO presumes that it should award an exclusive property right to anyone who asks for it. If the examiner's initial review does not result in "a prima facie case of unpatentability, then without more the applicant is entitled to grant of the patent." In re Oetiker, 977 F.2d at 1445 (citations omitted). For example, "[i]f the examiner does not produce a prima facie case [of obviousness], the applicant is under no obligation to submit evidence of nonobviousness." MPEP § 2142. Thus, the PTO's favorable determination is better understood as a non-denial rather than an issuance subject to deference.

11

2. Moreover, a "plethora of [additional] presumptions and procedures tip the scales in favor of the ultimate issuance of a patent, once an application is filed." FTC Report, Executive Summary at 8. Under the PTO's institutionalized procedures, examiners do not typically consider all aspects of patentability. For example, "[t]he examiner should assume that the best mode [required by 35 U.S.C. § 112] is disclosed in the application . . . ." MPEP ß 2165.03. In addition, "[t]here is a strong presumption that an adequate written description of the claimed invention is present" in an application, MPEP § 2163, along with a similar presumption concerning the enablement requirement, MPEP § 2164.04.

Those guidelines concerning the various requirements for patentability that are set forth in 35 U.S.C. § 112 mean that the PTO "rejects fewer patent applications for § 112 disclosure problems than for prior art problems and virtually never provides a detailed analysis of claim language, meaning that serious § 112 analysis is left for litigation." R. Polk Wagner, Understanding Patent-Quality Mechanisms, 157 U. Pa. L. Rev. 2135, 2150 (2009). Likewise, examiners rarely inquire into important non-documentary sources of information, such as the knowledge of skilled artisans, market demands, see KSR, 550 U.S. at 418, and public uses or commercial offers for sale, see 35 U.S.C. § 102(b). The PTO can require an applicant to disclose such information. See 37 C.F.R. § 1.105; MPEP §§ 704.10, 704.11. But such inquiries present obvious challenges, especially in an ex parte setting, and the PTO has not widely

12

required applicants to disclose such information. See John R. Thomas, The Responsibility of the Rulemaker, 17 Berkeley Tech. L.J. 727, 749-50 (2002).

3. The PTO procedures discussed above produce a substantial risk of error in issuing patents. That risk is compounded by the PTO's limited resources. Despite the PTO's technical expertise, it lacks the resources to review each patent application thoroughly. This Court identified that problem over four decades ago, Graham v. John Deere Co. of Kansas City, 383 U.S. 1, 18 (1966), and the PTO's resources have been stretched even further since then.

"Almost any patent lawyer will agree that the U.S. patent system is currently overburdened: there are too many patent applications and not enough examiners to ensure that the merits of each and every patent are properly assessed." Matthew Sag & Kurt Rohde, Patent Reform and Differential Impact, 8 Minn. J.L., Science, & Tech. 1, 16 (2007); see also Warren K. Mabey, Jr., Deconstructing the Patent Application Backlog, 92 J. Pat. & Trademark Off. Soc'y 208 (2010); Mark A. Lemley & Bhaven Sampat, Examining Patent Examination, 2010 Stan. Tech. L. Rev. 2 (2010). In 2003, the FTC found that examiners "have from 8 to 25 hours to read and understand each application, search for prior art, evaluate patentability, communicate with the applicant, work out necessary revisions, and reach and write up conclusions." FTC Report, Executive Summary at 10; see also Mark A. Lemley, Rational Ignorance at the Patent Office, 95 Nw. U. L. Rev. 1495, 1500

13

(2001). The number of patent applications submitted to the PTO has increased by 37% since then, from 355,418 to 485,500 annually, making the situation even worse. See Microsoft Pet. 19; PTO, Performance and Accountability Report Tables 1-3 (2009), http://www.uspto.gov/about/ stratplan/ar/2009/2009annualreport.pdf.

The PTO's lack of resources poses particular problems in light of its ex parte examination process. Without an adversary to aid the process and expand the record, the PTO examiner often lacks adequate time to develop a complete understanding of the relevant technology and prior art. Joseph Farrell & Carl Shapiro, Intellectual Property, Competition, and Information Technology (Working Paper 2004), at 33, available at http://papers.ssrn.com/sol3/ papers.cfm?abstract_id=527782.

By contrast, when the PTO reexamines a previously issued patent, its second look normally reveals that the patent's original issuance was in error. Whereas a single examiner undertakes an initial examination and has to attempt to consider a wide range of issues in a limited amount of time, three experienced examiners from the PTO's Central Reexamination Unit conduct a reexamination that focuses on specific validity issues. See generally MPEP § 2271 (2008). Inter partes reexaminations also provide adversarial guidance. See 35 U.S.C. § 314. Significantly, 92% of the previously issued patents that go through inter partes reexaminations are either cancelled or re-issued only after the patentee amends some of the claims. See PTO, Quarterly Review: Inter

14

Partes Reexamination Filing Data Review, http://www.uspto.gov/patents/ IP_quarterly_report_June_30_2010.pdf. Patents involved in ex parte reexaminations do not fare much better: only 23% have escaped with all claims confirmed, and that number has dropped in recent years to about 12% last year. See PTO, Quarterly Review: Ex Parte Reexamination Filing Data Review, http://www.uspto.gov/ patents/EP_quarterly_report_June_30_2 010.pdf. The PTO's own reexaminations show that resource constraints and the limits on its ex parte examination process cause it to issue many patents in error.

4. A growing number of scholars have concluded that the PTO is issuing a large number of patents of dubious validity. See, e.g., Doug Lichtman & Mark A. Lemley, Rethinking Patent Law's Presumption of Validity, 60 Stan. L. Rev. 45, 47 (2007); Joshua D. Sarnoff, Bilcare, KSR, Presumptions of Validity, Preliminary Relief, and Obviousness in Patent Law, 25 Cardozo Arts & Ent. L.J. 995, 1050-52 (2008). Like the reexamination results, litigation results support that conclusion. When judges determine patents' validity on summary judgment or following a bench trial, they invalidate patents approximately half of the time, notwithstanding the daunting burden of proof. See Mark A. Lemley & Carl Shapiro, Probabilistic Patents, 19 J. Econ. Persp. 75, 76 (2005); Adam B. Jaffe & Josh Lerner, Innovation and Its Discontents 125 (2004). Under more balanced standards, that number would undoubtedly increase.

15

As the FTC concluded, "[i]t does not seem sensible to treat an issued patent as though it had met some higher standard of patentability." FTC Report, Executive Summary at 10. "Whatever greater technical expertise does exist [at the PTO] . . . is counterbalanced by the greater time devoted to validity in the litigation process." Lemley, 95 Nw. U. L. Rev. at 1510 n.64. Litigation permits an in-depth review of issues that the examiner may not have even been aware of, much less had time to focus on.

The bottom line is that patent applicants receive the benefit of favorable procedures and a resource-constrained review by the PTO and then assert presumptively valid patents that, according to the Federal Circuit, can be defeated only by clear and convincing evidence. That serves only to insulate patents of dubious quality from adequate scrutiny at any stage.

B. The PTO's Grant Of A Patent Should Not
Receive Deference Under Ordinary
Principles Of Administrative Law.
The realities of the examination process discussed above show that, under traditional administrative-law principles, the PTO's issuance of a patent is not entitled to deference, much less the strong deference the Federal Circuit gives it. The PTO's presumptions and procedures mean that it does not approve patent applications so much as it does not deny them unless a time-constrained examiner discovers and develops a prima facie case of unpatentability. This process of issuing effective

16

non-denials is not entitled to deference for at least two reasons.

1. First, the amount of deference due to an agency decision generally correlates with the thoroughness of that decision. See Motor Vehicle Mfrs. Assn. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 42-44 (1983); Skidmore v. Swift & Co., 323 U.S. 134, 140 (1944). The practical constraints on the time available for review of each ex parte patent application, and the procedures that constrain examiners' ability thoroughly to consider all aspects of validity, demonstrate that the PTO is not entitled to deference.

Indeed, under general principles of administrative law, an agency commits reversible error when it fails to consider an important aspect of the problem before it. Motor Vehicles, 463 U.S. at 43. For practical reasons, as discussed above, the PTO's institutionalized procedures encourage examiners not to consider all requirements for validity. For the courts to give a heightened presumption of validity to patents issued by that process would turn basic administrative law principles on their head.

Second, and most fundamentally, the PTO's other pro-applicant presumptions and procedures provide an additional reason for not deferring to its issuance of a patent. When agencies systematically place a thumb on the scale, courts often apply a reduced level of deference. See, e.g., NLRB v. St. Mary's Home, Inc., 690 F.2d 1062, 1067 (4th Cir. 1982); UPS Worldwide Forwarding, Inc. v. United States Postal Serv., 66 F.3d 621, 638-39 (3d Cir.

17

1995); Spentonbush/Red Star Cos. v. NLRB, 106 F.3d 484, 492 (2d Cir. 1997). As discussed above, the PTO does that in this context by presuming that patent applications are patentable. One leading commentator has concluded that the PTO views "its mission to be 'helping our customers get patents.'" Lemley, 95 Nw. U. L. Rev. at 1496 n.3 (citation omitted). Whether or not that is the case, "the presumption of validity attached to a determination of patentability made by the United States Patent Office [must be] subject to searching review by the courts." Howes v. Great Lakes Press Corp., 679 F.2d 1023, 1028-29 (2d Cir. 1982) (citations omitted).

2. The Federal Circuit's application of its clear-and-convincing-evidence standard also deviates from ordinary deference doctrines by affording deference without regard to the reasoning behind the PTO's issuance of a patent. As this Court has made clear, "an administrative order cannot be upheld unless the grounds upon which the agency acted in exercising its powers were those upon which its action can be sustained." SEC v. Chenery Corp., 318 U.S. 80, 95 (1943) (emphasis added). Similarly, "the focal point for judicial review should be the administrative record already in existence, not some new record made initially in the reviewing court" and not considered by the agency. Camp v. Pitts, 411 U.S. 138, 142 (1973) (per curiam) (emphasis added).

In the Federal Circuit's view, however, deference is not tied to the reasons an examiner issued a patent. Instead, the clear-and-convincing- evidence standard always applies. Am. Hoist &

18

Derrick, 725 F.2d at 1359. And the basis for an examiner's conclusion, as well as the examiner's findings, are only non-exclusive factors for a court to consider in making its own independent determination of invalidity. See, e.g., Pfizer, Inc. v. Apotex, Inc., 480 F.3d 1348, 1359-60 (Fed. Cir. 2007); Fromson v. Advance Offset Plate, Inc., 755 F.2d 1549, 1555 (Fed. Cir. 1985) (holding that examiner's decision is merely "evidence the court must consider"); Interconnect Planning Corp. v. Feil, 774 F.2d 1132, 1139 (Fed. Cir. 1985) (holding that court must make "independent conclusion" while deferring to the PTO's "result"). For that reason as well, the Federal Circuit's clear-and-convincing requirement bears little relationship to established deference doctrines.

That conclusion is all the more clear in cases where litigants raise evidence and theories that the PTO did not consider. It is appropriate and sometimes essential for a defendant to raise invalidity issues or evidence that the patentee did not disclose to the PTO. See Purdue Pharma L.P. v. Faulding Inc., 230 F.3d 1320, 1329 (Fed. Cir. 2000). That further undermines the case for deference under the administrative-law principles discussed above. It also demonstrates that the clear-and-convincing standard is not based on deference to the PTO's actual determinations.

This Court has observed that the rationale behind the presumption of validity is "much diminished" where the examiner did not actually review the relevant prior art or event. KSR, 550 U.S. at 426. The Federal Circuit has likewise acknowledged that, "[w]hen new evidence touching

19

validity of the patent not considered by the PTO is relied on, the tribunal considering it is not faced with having to disagree with the PTO or with deferring to its judgment or with taking its expertise into account." Am. Hoist & Derrick, 725 F.2d at 1360 (emphases in original). But even though deference to an administrative determination is not at issue, because the PTO has made no relevant determination, the Federal Circuit still applies the clear-and-convincing-evidence standard in that and every other circumstance. Id. The Federal Circuit even applies its heightened burden of proof when the applicant misrepresented the relevant prior art, obscured it as part of a last-minute deluge of additional documents, or provided it only in a foreign language. See id. at 1359 (holding that the clear-and-convincing standard always applies). The Federal Circuit's across-the-board application of its clear-and-convincing standard is proof positive that the standard is not based on rational deference to the PTO's determinations.

Indeed, the Federal Circuit applies its clear- and-convincing-evidence standard even when the PTO itself has called its issuance of a patent into question. If the PTO has found that a substantial new question of patentability warrants a reexamination, the Federal Circuit still applies its clear-and-convincing requirement in litigation concerning the same patent. See Procter & Gamble Co. v. Kraft Foods Global, Inc., 549 F.3d 842, 848 (Fed. Cir. 2008). If the PTO examiners finally reject a patent during reexamination, the Federal Circuit applies the clear-and-convincing-evidence

20

requirement as long as appeals from the reexamination are pending. See Callaway Golf Co. v. Acushnet Co., 576 F.3d 1331, 1337 n.4, 1342 (Fed. Cir. 2009). There is no justification for deferring to an examiner's initial issuance of a patent when three examiners have since determined on reexamination that the patent is not valid. The Federal Circuit's contrary conclusion underscores the indefensibility of its clear-and-convincing standard.
C. A Heightened Burden Of Proof Only
Enhances Lay Juries' Tendency To Defer
Excessively To The PTO's Issuance Of A
Patent.
The statutory presumption of validity and the realities of jury trials already provide significant advantages to patent holders. There is no legal or policy justification for granting them an additional advantage.

"Jurors are notoriously reluctant to second-guess patent examiners." Lemley, 95 Nw. U. L. Rev. at 1528. "Jury research has indicated that almost one out of every three jurors is unwilling to undertake a task which they view [the PTO] to have already accomplished. While almost all jurors on voir dire will honestly state that they are willing to look behind that which [the PTO] has already done, many (if not most) will resort to the presumption of validity once the issues become complicated or difficult." Donald S. Chisum et al., Principles of Patent Law 1036-40 (3d ed. 2004) ("side bar" of William F. Lee). Even without the clear-and-convincing-evidence standard, therefore,

21

lay juries face an enormous temptation to defer to the PTO instead of having to master the sometimes daunting complexity of technical details on which an alleged infringer's case often depends. Id.

Especially in complex patent cases, the clear-and-convincing requirement can often dictate the outcome because "it is very difficult to ever make the evidence 'clear and convincing' to a group of people who do not have the necessary training and education to understand it." Jaffe & Lerner, supra, at 196. "Thus the 'clear and convincing evidence' standard combined with decision-making by juries makes it likely that the patentee will win on validity questions" regardless of whether the patent is actually valid. Id.

Indeed, the evidence shows that juries are twice as likely as judges to find patents valid. Id. at 125; see also Kimberly A. Moore, Judges, Juries, and Patent Cases, 99 Mich. L. Rev. 365, 390 (2000). Imposing a clear-and-convincing-evidence burden only enhances the significant risk of error that is already built into the system.

The clear-and-convincing standard has also had a corrosive effect on patent law itself. For example, this Court has long held that patent claims must "clearly circumscribe" their scope in order to satisfy the definiteness requirement for patentability. United Carbon Co. v. Binney & Smith Co., 317 U.S. 228, 236 (1942). The Federal Circuit, however, has held that claims may be ambiguous so long as they are not "insolubly ambiguous." Datamize, LLC v. Plumtree Software, Inc., 417 F.3d 1342, 1347-48 (Fed. Cir. 2005). And it has cited the need to

22

"follow" its clear-and-convincing requirement as a reason for adopting that more permissive standard. Id. In that respect as well, the clear-and-convincing standard is skewing outcomes to favor the most questionable patents.

III. This Court's Precedents Do Not Require A Heightened Burden Of Proof.

The Federal Circuit has concluded that this Court's precedents support a clear-and-convincing-evidence requirement. See, e.g., Am. Hoist & Derrick, 725 F.2d at 1359. They do not.

1. An older line of cases holds that, when a party relies only on oral testimony for the proposition that a patent is invalid because of a prior use, the oral testimony must prove the prior use "beyond a reasonable doubt." Adamson v. Gilliland, 242 U.S. 350, 352-53 (1917); The Barbed Wire Patent, 143 U.S. 275, 284 (1892); Cantrell v. Wallick, 117 U.S. 689, 693-695 (1886); Coffin v. Ogden, 85 U.S. 120, 124 (1873). This Court explained that "oral testimony tending to show prior invention as against existing letters patent is, in the absence of models, drawings or kindred evidence, open to grave suspicion." T.H. Symington Co. v. Nat'l Malleable Castings Co., 250 U.S. 383, 386 (1919); see also The Barbed Wire Patent, 143 U.S. at 284; Adamson, 242 U.S. at 353.

That elevated evidentiary burden is irrelevant because it relates to the nature of a particular type of evidence (uncorroborated oral testimony concerning a prior use, which tends to be uniquely within the knowledge of the witness), not to the nature of validity more generally. Thus, this Court

23

has not required a heightened burden of proof for invalidity challenges generally. In The Barbed Wire Patent, for example, this Court resolved invalidity defenses based in part on documentary evidence without applying a heightened standard; it then articulated and applied the "beyond a reasonable doubt" standard only for purposes of uncorroborated oral testimony about prior uses. 143 U.S. at 284. In other cases, this Court likewise held patents invalid without applying, or even mentioning, a heightened evidentiary standard. E.g., Pfaff v. Wells Elecs., Inc., 525 U.S. 55 (1998); Sakraida v. Ag Pro, Inc., 425 U.S. 273 (1976); Graham, 383 U.S. 1.

The Federal Circuit itself has read The Barbed Wire Patent line of cases to require corroboration of oral testimony. See Juicy Whip, Inc. v. Orange Bang, Inc., 292 F.3d 728, 740 (Fed. Cir. 2002); Finnigan Corp. v. ITC, 180 F.3d 1354, 1366-69 (Fed. Cir. 1999). That corroboration requirement fully addresses the concerns discussed in this Court's cases; there is no reason to impose a clear-and-convincing-evidence standard on top of it.

2. The Federal Circuit has also cited Radio Corp. of Am. v. Radio Eng'g Labs., 293 U.S. 1 (1934), in support of its clear-and-convincing-evidence standard. Am. Hoist & Derrick, 725 F.2d at 1359. After citing the cases discussed above, Radio Corp. stated in dictum that "one otherwise an infringer who assails the validity of a patent fair upon its face bears a heavy burden of persuasion, and fails unless his evidence has more than a dubious preponderance." 293 U.S. at 8.

24

Significantly, Radio Corp. did not concern a patent issued by the PTO following only an ex parte examination. Instead, it concerned a claim of prior inventorship -- a question that had previously been litigated multiple times between the purported inventors, both in inter partes proceedings before the PTO and in district court litigation. 293 U.S. at 3-7. When assignees of the prevailing patentee brought suit for infringement, and the defendant attempted to relitigate priority of inventorship yet again, this Court held that the defendant could not overcome the prior determinations. Id. at 8.

The inter partes priority proceedings at issue in Radio Corp. are far removed from the PTO's typical ex parte examination of a patent application. Moreover, this Court's discussion of the appropriate evidentiary standard in Radio Corp. -- "more than a dubious preponderance" -- was pure dictum. See id. The defendant in that case could not have surmounted any burden of proof by refighting a lost battle. Perhaps for that reason, this Court was less than clear about what it meant by "more than a dubious preponderance." And as noted above, this Court has not typically applied a clear-and-convincing-evidence standard to invalidity. See p. 23, supra.2

25

Before the creation of the Federal Circuit, at least two regional circuits determined that the traditional preponderance-of-the-evidence standard applies to validity challenges "in the usual case." Rains v. Niaqua, Inc., 406 F.2d 275, 278 (2d Cir. 1969); see also Dickstein v. Seventy Corp., 522 F.2d 1294, 1297 (6th Cir. 1975). Numerous other circuits agreed that the clear-and-convincing-evidence standard should not apply where, as in this case, the PTO did not consider the relevant prior art. Microsoft Pet. 15-18. Those courts correctly recognized that this Court's precedents do not mandate a clear-and-convincing-evidence standard. Instead, the question is governed by traditional principles of law, the text of the Patent Act, and the practical realities of the patent system, all of which confirm that there is no such requirement.

CONCLUSION

For the foregoing reasons, this Court should grant the petition for a writ of certiorari.

26

Respectfully submitted,

PAUL D. CLEMENT
Counsel of Record
DARYL JOSEFFER
ADAM CONRAD
KING & SPALDING LLP
[address, phone]
Counsel for Amici Curiae

JOHN THORNE
GAIL F. LEVINE
VERIZON
COMMUNICATIONS INC.
[address, phone]
Counsel for Verizon
Communications Inc.

MICHELLE K. LEE
CATHERINE C. LACAVERA
TIMOTHY A. PORTER
JOHN L. LABARRE
GOOGLE INC.
[address, phone]
Counsel for Google Inc.

PAUL H. ROEDER
HEWLETT-PACKARD CO.
[address, phone]
Counsel for Hewlett-Packard Co.

September 29, 2010

______

1 Pursuant to Sup. Ct. R. 37.2(a), amici timely notified the parties of their intent to file this brief. The parties have consented to the filing of this brief in letters submitted herewith or on file with the Clerk. No counsel for any party authored this brief in whole or in part, and no person or entity, other than amici and its counsel, made a monetary contribution intended to fund the preparation or submission of this brief.

2 This Court's recitation of the reasonable-doubt standard in Mumm v. Jacob E. Decker & Sons, 301 U.S. 168, 171 (1937), was likewise dictum. Mumm held only that plaintiffs need not plead validity because it is an affirmative defense; the Court mentioned the evidentiary standard by which a defendant must overcome its burden of proof only in passing dictum. Id.

27

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

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

No. 10-290

In The
Supreme Court of the United States

Microsoft Corporation,

Petitioner,

v.

I4I Limited Partnership, et al.,

Respondents.

On Petition for a Writ of Certiorari
To the United States Court of Appeals
For the Federal Circuit

BRIEF OF AMICI CURIAE
ELECTRONIC FRONTIER FOUNDATION,
PUBLIC KNOWLEDGE, COMPUTER &
COMMUNICATIONS INDUSTRY
ASSOCIATION, AND APACHE SOFTWARE
FOUNDATION IN SUPPORT OF PETITIONER

Michael Barclay
Counsel of Record
Julie P. Samuels
Corynne McSherry
James S. Tyre
ELECTRONIC FRONTIER FOUNDATION
[address, phone, email]

Attorneys For Amici Curiae
[Additional Counsel Listed on Inside Cover]

Of counsel:

Sherwin Siy
PUBLIC KNOWLEDGE
[address, phone, email]

Matt Schruers
COMPUTER & COMMUNICATIONS
INDUSTRY ASSOCIATION
[address, phone, email]

Lawrence Rosen
THE APACHE SOFTWARE FOUNDATION
Rosenlaw & Einschlag
[address, phone, email]

TABLE OF CONTENTS

Page

TABLE OF AUTHORITIES....................................iii

INTEREST OF AMICI CURIAE...............................1

SUMMARY OF ARGUMENT...................................3

ARGUMENT .............................................................. 5

I. THE CLEAR AND CONVINCING EVIDENCE

STANDARD IMPEDES THE
DEVELOPMENT OF OPEN SOURCE
SOFTWARE .................................................... 5

II. FINDING CLEAR AND CONVINCING

EVIDENCE OF PATENT INVALIDITY IS A
RECURRING PROBLEM IN COMPUTER
SOFTWARE PATENT CASES.......................8

A. Patent Owners Assert that Accused
Infringers Must Use the Prior Art's
Source Code to Prove Invalidity, But
that Source Code is Often Unavailable
Years After the Fact..............................8

B. The Growth in the Number of Issued
Patents and of Patent Lawsuits Since
the Formation of the Federal Circuit
Exacerbates the Problem.....................12

III. THE COURT SHOULD INTERPRET
SECTION 282 OF THE PATENT ACT
ACCORDING TO ITS PLAIN MEANING
AND THE COURT'S PRECEDENTS..........17

i

CONCLUSION........................................................20

ii

TABLE OF AUTHORITIES

Page(s)

Cases

Bilski v. Kappos, 561 US_,
130 S. Ct. 3218 (2010).............................................. 19

eBay Inc. v. MercExchange,
L.L.C., 597 U.S. 388 (2005).......................... 16, 17, 18

Fonar Corp. v. General Electric Co., 107 F.3d 1593
(Fed. Cir. 1997)......................................................... 11

Grogan v. Garner,
998 U.S. 279 (1991)............................................ 18, 19

Herman & MacLean v. Huddleston, 959 U. S. 375
(1983) ........................................................................ 20

i4i Ltd. Partnership v. Microsoft Corp., 598 F.3d 831
(Fed. Cir. 2010)...............................................9, 11, 12

In re Alappat, 33 F.3d 1526 (Fed. Cir. 1994)
................................................................................ .. 19

Jacobsen v. Katzer,
535 F.3d 1373 (Fed. Cir. 2008)..................................5

KSR Int'l Co. v. Teleflex Inc., 550 U.S. 398, 127 S. Ct.
1727 (2007)......................................................... 17, 18

Markman v. Westview Instruments, Inc., 517 U.S.
370 (1996)................................................................. 17

Microsoft Corp. v. AT&T Corp., 550 U.S. 437, 459,
127 S. Ct. 1746 (2007)..........................................8

iii

Northern Telecom, Inc. v. Datapoint Corp., 908 F.2d
931 (Fed. Cir. 1990)............................ 11

State Street Bank & Trust v. Signature Financial
Group
, 149 F.3d 1368 (Fed. Cir. 1998).................... 14

Statutes and Legislative Authorities

35 U.S.C. § 101.................................14

35 U.S.C. § 103.................................17

35 U.S.C. § 282...................... 5, 18, 20

35 U.S.C. § 283................................17

Federal Trade Commission, To Promote Innovation:
The Proper Balance of Competition and Patent Law
and Policy
(2003)................................. 3, 7, 11
H.R. Rep. No. 97-312 (1981)............................. 17

Other Authorities

James Bessen & Michael J. Meurer, The Patent
Litigation Explosion
, Boston University School Of
Law Working Paper Series, Law And Economics
Working Paper No. 05-18 (2005)............................ 16

John Allison, et al, Valuable Patents, 92. Geo. L.J.
435 (2004)...................................................................3

Patent Scope and
Innovation in the Software Industry, 89 Cal. L. Rev.
(2001)............................................................ 10, 11, 14

iv

Yochai Benkler, The Wealth of Networks:
How Social Production Transforms Markets and
Freedom
(2006)...........................................................5

v

INTEREST OF AMICI CURIAE*1

The Electronic Frontier Foundation ("EFF") is a nonprofit civil liberties organization that has worked for more than twenty years to protect consumer interests, innovation, and free expression in the digital world. EFF and its more than 19,000 dues-paying members ha8e a strong interest in helping the courts and policy-makers in striking the appropriate balance between intellectual property and the public interest. The Federal Circuit's requirement that an accused infringer prove patent invalidity by "clear and convincing" evidence undermines the traditional patent bargain between private patent owners and the public and threatens to impede innovation and the dissemination of knowledge. These are issues of critical importance to consumers and the public interest. As an established advocate for the interests of consumers and innovators, EFF has a perspective to share that is not represented by the parties to this appeal, neither of whom speaks directly for the interests of

1

consumers or the public interest generally.

As part of its mission, the EFF has often served as amicus in key patent cases, including Bilski v. Kappos, 130 S. Ct. 3218 (2010); Quanta Computer, Inc. v. LG Electronics Corp., 128 S. Ct. 2109 (2008); KSR Int'l Co. v. Teleflex Inc., 550 U.S. 398 (2007); and eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2005).

Public Knowledge is a non-profit public interest organization devoted to protecting citizens' rights in the emerging digital information culture and focused on the intersection of intellectual property and technology. Public Knowledge seeks to guard the rights of consumers, innovators, and creators at all layers of our culture through legislative, administrative, grassroots, and legal efforts, including regular participation in patent and other intellectual property cases that threaten consumers, trade, and innovation.

The Computer & Communications Industry Association ("CCIA") is a non-profit trade association dedicated to open markets, open systems and open networks. CCIA represents companies in the high technology products and services sectors, including computer hardware and software, electronic commerce, telecommunications and Internet products and services. More information on CCIA members is available online at http://www.ccianet.org/members.

The Apache Software Foundation (ASF) is a non-profit 501(c)(3) corporation that produces software projects under a pragmatic open-source license for the public good.

2

SUMMARY OF ARGUMENT

Properly understood, a patent is a distinct statutorily-created and limited set of rights, designed to encourage inventors to disclose their inventions to the public, thereby promoting scientific and industrial progress. Illegitimate patents inhibit that progress, the sharing of knowledge, and the pace of innovation.

Allowing parties to lawsuits to challenge patents asserted against them serves as a necessary check on illegitimate patents and helps ensure that improper patents receive independent review in a court of law. Artificially high standards of proof, such as that advanced by the Federal Circuit, undermine the effectiveness of this review by impeding the ability of parties—especially parties engaged in developing free and open source software—to present effective challenges. As a result, the system, and the important bargain between intellectual property and the public interest, suffers.

This amicus brief makes three points. First, software and computer-related patents have started to make up a larger percentage of litigated patents. See generally, John Allison, et al, Valuable Patents, 92. Geo. L.J. 435, 472 (2004). This development in turn disproportionately harms Free and Open Source Software (together, "FOSS") projects, both of which tend to lack substantial, stand-alone litigation budgets. In recent years, FOSS projects—which involve the open development and exchange of source code—have become mainstream and are now critical to computer and Internet technology. Federal Trade Commission, To Promote Innovation:

3

The Proper Balance of Competition and Patent Law and Policy ("FTC Report") Chap. 3, at 51 (2003)*2 ("software patentability has introduced new costs, such as the cost of obtaining a patent, determining whether a patent is infringed, defending a patent infringement suit, or obtaining a patent license . . . may disproportionally affect small firms and individual programmers and the open source community"). By impeding FOSS growth in particular, the upward trend in patent litigation serves as a detriment to innovation in general.

Second, the Federal Circuit's heightened standard of proof of invalidity creates an especially pernicious effect in computer software patent cases. Software patent plaintiffs often argue that it is necessary to use the source code of the prior art software product to prove a software patent invalid. However, that source code is frequently unavailable when needed, which is often years after the product in question was in use. While software patent plaintiffs can use the accused infringer's current source code to prove infringement by a preponderance of the evidence, if the prior art source code is unavailable it will be difficult for the defendant to prove invalidity by that same preponderance, let alone by clear and convincing evidence. Although the unavailability of the source code does not foreclose an invalidity defense, given the complex technical issues and the heightened standard, the practical effect is that plaintiffs are given free rein to argue that the alleged infringer cannot meet its heightened standard of proof without

4

the source code.

The sharp increase in the number of issued patents and number of patent lawsuits since the Federal Circuit's creation exacerbates this problem and further inhibits innovation in the software industry.

Third, the statutory language of 35 U.S.C. § 282 does not contain the Federal Circuit's enhanced standard of proof. Following the statute's plain meaning and this Court's precedent, the proper standard of proving patent invalidity should be preponderance of the evidence.

ARGUMENT

I. THE CLEAR AND CONVINCING
EVIDENCE STANDARD IMPEDES THE
DEVELOPMENT OF OPEN SOURCE
SOFTWARE

Started several decades ago by a few core groups of programmers, FOSS has blossomed into a valuable and large segment of the information technology industry, with companies such as IBM, Novell, Sun Microsystems, and Red Hat offering products built on the FOSS development process. That process "invite[s] computer programmers from around the world to view software code and make changes and improvements to it. Through such collaboration, software programs can often be written and debugged faster and at lower cost than if the copyright holder were required to do all of the work independently." Jacobsen v. Katzer, 535 F.3d 1373, 1379 (Fed. Cir. 2008). FOSS technologies are now widely used by public and private entities, from

5

the United States government to private corporations such as IBM Corporation, Sun Microsystems, and Google, Inc. See Yochai Benkler,The Wealth of Networks: How Social Production Transforms Markets and Freedom 64 (2006).

In FOSS projects, unlike the closed and proprietary software developed by Petitioner, software develops openly and transparently. The conversations, the computer code, and each stage of development are accessible and open to the public, maximizing access to scientific and industrial knowledge in the community and spurring further productivity and innovation. In addition, most FOSS collaborations involve contributors from a wide variety of companies, groups, and countries, many of whom volunteer their time and ingenuity out of passion and dedication instead of financial reward.

And therein lies the rub. Because these collaborations are forged primarily through community rather than capital investment, many FOSS projects lack the funding to pay for patent counsel, much less litigation. The FOSS business model ensures that FOSS developers generally do not make the kind of money required to successfully mount patent litigation defenses, especially when those defenses require the search for long-lost or arcane source code.

Even if the FOSS community had the resources to litigate, FOSS developers face an additional hurdle: the FOSS business model makes it nearly impossible to collect prior art in a format that makes it useful as potentially invalidating under current Federal Circuit guidelines. To fend off

6

patent threats, FOSS projects often depend on the collective knowledge of their members and the documentation of the projects as prior art, to the extent that such documents exist.

Much of this collective knowledge, however, arguably could not be considered as evidence under the Federal Circuit's current standard requiring alleged infringers to provide invalidity by "clear and convincing" evidence. Indeed, the opinion below may be read to hold that, without obtaining a full set of source code, a party could not rely on evidence of the operation of the source code to invalidate a patent.

In the FOSS context, that full set may be extremely difficult to assemble. For example, consider various emails exchanged between developers all over the world, each with different snippets of code and comments. Some of those developers may archive their email; other will not, or will not do so in an easily searchable form.

Moreover, if the culture of software development tends to be informal, FOSS development is still more informal. FTC Report, supra, Chap. 3, at 54. Documentation is likely to take the form of emails or postings to internet message boards and newsgroups that are much more informal than traditional academic research or industry publications. Further, more often than not, no party is tasked with maintaining copies of the source code that makes up the FOSS and it often gets lost and becomes unobtainable at a later date when needed in litigation.

Thus, holders of patents that are unnecessarily virtually indestructible because of the inflated standard for proving invalidity pose a

7

particular threat to FOSS. That, in turn, threatens the public interest in promoting the innovative activities that would take place but for these lawsuits and the mere threat of these suits.

II. FINDING CLEAR AND CONVINCING
EVIDENCE OF PATENT INVALIDITY IS
A RECURRING PROBLEM IN COMPUTER SOFTWARE PATENT
CASES

A. Patent Owners Assert that Accused
Infringers Must Use the Prior Art's
Source Code to Prove Invalidity,
But that Source Code is Often
Unavailable Years After the Fact
The problems Microsoft faced in this case are both common and pernicious. In a software patent case, proving whether an accused program infringes or whether a prior art program invalidates can involve an examination of the program's source code.3 In many software patents, some claim limitations may be practiced by the source code. Therefore, the source code is compared to the claims to establish infringement or, as in this case, invalidity. Although the unavailability of the source

8

code does not foreclose an invalidity defense, given the complex technical issues and the heightened standard, the practical effect is that plaintiffs are given free rein to argue that the alleged infringer cannot meet its heightened standard of proof without the source code.

For example, in this case, respondent i4i argued, and both lower courts agreed, that Microsoft was unable to prove its invalidity case without the relevant prior art's source code. Microsoft cert. petition at 9, 25; i4i Ltd. Partnership v. Microsoft Corp., 598 F.3d 831, 848 (Fed. Cir. 2010), Pet. App., 22a (i4i's expert "opined that it was impossible to know whether the claim limitation was met without looking at [the prior art's] source code."); see also Pet. App., 139a (district court stated that the testimony of i9i's expert "that no one could assess whether S9 met the claims of the '449 patent without the relevant source code was compelling").

In most cases, the patent owner can easily get the accused infringer's current source code in discovery, and prove infringement by a mere preponderance that way. See, e.g., Patent L.R. 3-9(a) for the Northern District of California;*4 P.R. 3-9(a) for the Eastern District of Texas*5 (both requiring the accused infringer to produce its source code early in the case).

9

In contrast, the source code for prior art is often unavailable. First, "undocumented prior art" in software is not published as in other scientific fields, and in fact "[frequently, the source code itself is never released at all." Mark A. Lemley & Julie E. Cohen, Patent Scope and Innovation in the Software Industry, 89 Cal. L. Rev. 1, 13, 42-44 (2001) ("Lemley & Cohen"). As one software company explained in a public hearing:

Unlike most other technologies—such as pharmaceuticals, chemicals, and industrial design—there are no extensive, comprehensive databases where software prior art can be reliably found. In the computing arts, particularly in the open source community, a great amount of innovation has been and is produced by individuals who never publish in industry journals. . . . Thus, diligent searches for business methods and software are often unreliable and costly. . . . the burden typically falls to the public and small-scale innovators to consider expensive and time-consuming litigation.

Webbink, "Red Hat's Comments To The Joint FTC-DOJ Hearing on Competition and Intellectual Property Law," March 20, 2002,*6 at pages 2-3. What is worse, for confidentiality reasons, non-open source

10

third-party companies (or even parties who later litigate these issues) often carefully guard their source code as valuable trade secrets.

Even when a software company does patent its technology, such patents often do not disclose the source code. The Federal Circuit has held that a high-level functional description will suffice, thereby negating the need to disclose source code, flowcharts, or detailed descriptions of the patented program. See Fonar Corp. v. General Electric Co., 107 F.3d 1593, 1599 (Fed. Cir. 1997); Northern Telecom, Inc. v. Datapoint Corp., 908 F.2d 931, 941-42 (Fed. Cir. 1990); Lemley & Cohen, 89 Cal. L. Rev. at 24-25; FTC Report, Chap. 5 at 7 ("difficulties are particularly acute when non-patent prior art is important and in new areas of technology, e.g., software and biotechnology, and new fields of patenting activity, e.g., business methods").

Further, while the open source code discussed above is not kept secret at the outset, it, too, can be difficult to locate when it becomes relevant during a patent lawsuit. Thus, for all forms of source code, the mere passage of time means that such source code will be difficult if not impossible to find and introduce as possible prior art. See, e.g., i4i v. Microsoft, 598 F.3d at 846-47, Pet. App., 20a (source code was destroyed before the litigation began). Thus, software patent litigation will necessarily be skewed against alleged infringers, because they will simply be unable to obtain all of the evidence that could be used in their defense.

All of the above tends to reduce software patent litigation to a game of "gotcha." The patent owner argues that it proved infringement by a

11

preponderance of the evidence, using the very source code the accused infringer was required to produce in discovery. At the same time, the patent owner prejudicially argues to the jury that the accused infringer did not (and cannot) prove invalidity because the prior art source code isn't available. See, e.g., Pet. App., 138a-139a (i4i's expert attacked Microsoft's expert for rendering an invalidity opinion without reviewing the unavailable code). Even in cases where source code is not necessary to prove invalidity, when the code isn't available the patent owner will prejudicially argue that the accused infringer can't even offer the same quantum of proof of invalidity as the patent owner did for infringement — let alone provide the added proof that is clear and convincing. That is what the lower courts concluded here. i4i v. Microsoft, 598 F.3d at 848, Pet. App., 22a (Microsoft failed to meet the clear and convincing standard of proof because the source code was missing).

B. The Growth in the Number of
Issued Patents and of Patent
Lawsuits Since the Formation of
the Federal Circuit Exacerbates
the Problem
The creation of the Federal Circuit in 1982 coincides with both a sharp increase in the number of patents issued and in the amount of patent litigation. The following table shows the number of issued patents per year since 1980:*7

12

The number of patent lawsuits likewise showed a “dramatic” increase since the early 1980’s:*8

13

The increase in issued patents and patent litigation has had serious consequences for the software industry, particularly after the Federal Circuit expanded patent protection for software. In re Alappat, 33 F.3d 1526 (Fed. Cir. 1994); State Street Bank & Trust v. Signature Financial Group, 149 F.3d 1368 (Fed. Cir. 1998), cert. denied, 525 U.S. 1093 (1999) (both Alappat and State Street greatly expanded the definition of patentable subject matter under 35 U.S.C. § 101 so as to include computer software);*9Lemley & Cohen, 89 Cal. L. Rev. at 10-11.

Principal among these consequences has been disincentive to innovation, as software companies find themselves forced to devote more resources to litigation rather than development. As one study explained:

14

Most of the rapid increase in patent litigation hazards over the 90s cannot be explained by firm patenting rates, R&D spending, firm value or industry composition. Looking at a variety of explanations, we conclude that legal changes may be the dominant factor driving this increase. This implies that the increase in patent litigation represents a growing disincentive to R&D that is not likely offset by growth in the number or value of innovations. Furthermore, we find evidence that this disincentive is borne by firms not only in their roles as patent holders, but also as innovators having to defend against patent lawsuits. We find that the more R&D a firm performs, the more likely it is to be sued. In most industries, this pattern of litigation is inconsistent with the view that most defendants in patent lawsuits are simple pirates or imitators. Instead, patent defendants are, to a large degree, innovators themselves, spending as much on R&D as the plaintiffs. . . .Thus an important part of the burden of patent disputes falls on defending firms. . . . Also, as Lanjouw and Schankerman (2004) find, the risk of litigation falls disproportionately on small firms.
James Bessen & Michael J. Meurer, The Patent Litigation Explosion, Boston University School Of Law Working Paper Series, Law And Economics

15

Working Paper No. 05-18 (2005), 10 at 27-28.

These effects are exacerbated by the many non-practicing entities (sometimes called "patent trolls") that have built a cottage industry in obtaining spurious patents and then using them to extract settlements. Justice Kennedy's concurring opinion in eBay Inc. v. MercExchange, L.L.C., described the practice:

An industry has developed in which firms use patents not as a basis for producing and selling goods but, instead, primarily for obtaining licensing fees. See FTC, To Promote Innovation: The Proper Balance of Competition and Patent Law and Policy, ch. 3, pp. 38-39 (Oct. 2003), available at http://www.ftc.gov/os/2003/10/innovationrpt.pdf (as visited May 11, 2006, and available in Clerk of Court's case file). For these firms, an injunction, and the potentially serious sanctions arising from its violation, can be employed as a bargaining tool to charge exorbitant fees to companies that seek to buy licenses to practice the patent.

547 U.S. 388, 396 (2005).

One way of mitigating the impact of this increase in software patent grants and resulting

16

litigation would be to level the playing field for challenging improper patents. An even-handed standard for proving validity would be a step in the right direction.

III. THE COURT SHOULD INTERPRET
SECTION 282 OF THE PATENT ACT
ACCORDING TO ITS PLAIN MEANING
AND THE COURT'S PRECEDENTS

Congress created the Federal Circuit in order to "strengthen the United States patent system." Markman v. Westview Instruments, Inc., 517 U.S. 370, 390 (1996), citing H.R. Rep. No. 97-312, at 2023 (1981). However, it is essential to ensure that, in carrying out this task, the Federal Circuit does not exceed Congress' statutory mandate.

For example, in eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2005), the Court reversed the Federal Circuit's implementation of its "general rule that courts will issue permanent injunctions against patent infringement absent exceptional circumstances." 401 F.3d 1323, 1339 (2005). Instead, this Court relied on the plain language of 35 U. S. C. § 283, which states that if a patent owner wins a trial, injunctions "may" issue "in accordance with the principles of equity" and held that "the Court of Appeals erred in its categorical grant" of automatic injunctions. 547 U.S. at 394.

Later, in KSR Int'l Co. v. Teleflex Inc., 550 U.S. 398, 127 S. Ct. 1727 (2007), the Court considered the obviousness standard in 35 U.S.C. § 103. The Federal Circuit had read into § 103 a heightened standard, "under which a court will only find a patent claim obvious if 'some motivation or

17

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." Id. at 407, 127 S. Ct. at 1734. In its roughly 20-year history in the Federal Circuit, this standard greatly favored patent owners; it was often difficult or impossible for an accused infringer to prove obviousness by showing a "teaching, suggestion, or motivation."

This Court unanimously reversed, holding that the Federal Circuit's "fundamental misunderstandings" of the Patent Act led the lower court to analyze the obviousness standard "in a narrow, rigid manner inconsistent with § 103" and this Court's precedents. Id. at 422, 428, 127 S. Ct. at 1743, 1746.

As with its eBay and KSR rulings, the Federal Circuit has once again interpreted the Patent Statute and relevant case law to include an unnecessary heightened standard that disproportionately burdens the defense. In this case, the relevant statute does not require the standard of proving invalidity to be by clear and convincing evidence; rather, 35 U.S.C. § 282 merely states that the "burden of establishing invalidity of a patent or any claim thereof shall rest on the party asserting such invalidity." Of course, if Congress wanted to require proving invalidity by clear and convincing evidence, it could have included that language in § 282. It did not.

Normally, the standard of proof in civil cases is preponderance of the evidence. In Grogan v. Garner, 498 U.S. 279 (1991), for example, the Court considered a section of the Bankruptcy Code

18

providing that a debtor would not be discharged from a debt obtained by actual fraud. The question was whether a creditor seeking to prevent discharge had to prove his claim of fraud by clear and convincing evidence, or by a preponderance of the evidence.

As here, the code section was silent on the standard of proof. Id. at 282. The Eighth Circuit held that the standard was one of clear and convincing evidence. Id. This Court reversed, id. at 286, stating:

Because the preponderance-of-the-evidence standard results in a roughly equal allocation of the risk of error between litigants, we presume that this standard is applicable in civil actions between private litigants unless "particularly important individual interests or rights are at stake," citing Herman & MacLean v. Huddleston, 459 U. S. 375, 389-390 (1983). The Court found no such "important" interests in Grogan, even though it dealt with the desirable goal of permitting a debtor to obtain a "fresh start" under the Bankruptcy Code. 498 U.S. at 286-87.

The same result should obtain here because, in the normal course, a civil action between private parties over the validity of a patent also will not raise the "important" interests with which the Court was concerned with in Grogan. In Herman & MacLean v. Huddleston, for example, the Court compared the types of cases where important interests were involved (such as proceedings to terminate parental rights or involuntary

19

commitment proceedings) with cases where they were not (such as securities fraud). 459 U. S. 375, 389-390 (1983). A patent suit, while an important exercise in striking an appropriate balance between intellectual property and the public interest, clearly falls into the latter category, where the preponderance of the evidence standard applies.

In this case, the Federal Circuit has incorrectly interpreted a clear statute. This Court should grant certiorari to correct the Federal Circuit's misreading of § 282.

CONCLUSION

The standard of proving patent invalidity is an important issue of nationwide importance. The petition for a writ of certiorari should be granted.

Respectfully submitted,

Michael Barclay
Counsel of Record
Julie P. Samuels
Corynne McSherry
James S. Tyre
ELECTRONIC FRONTIER FOUNDATION
[address, phone, email]

Attorneys for Amici Curiae
Electronic Frontier Foundation

20

Of Counsel:

Sherwin Siy
PUBLIC KNOWLEDGE
[address, phone, email]

Matt Schruers
COMPUTER & COMMUNICATIONS
INDUSTRY ASSOCIATION
[address, phone, email]

Lawrence Rosen
The APACHE SOFTWARE
FOUNDATION
Rosenlaw & Einschlag
[address, phone, email]

September 29, 2010

____________________

1 No counsel for a party authored this brief in whole or in part, and no such counsel or party made a monetary contribution intended to fund the preparation or submission of this brief. No person other than the amici curiae, or their counsel, made a monetary contribution intended to fund its preparation or submission. (Petitioner Microsoft Corp. is a member of CCIA, but did not author this brief in whole or in part, or make a monetary contribution intended to fund its preparation.) Pursuant to Supreme Court Rule 37.2(a), amici curiae provided at least ten days’ notice of their intent to file this brief to counsel of record for all parties. The parties have consented to the filing of this brief. Petitioner’s blanket consent and respondents’ blanket consent were filed with the Court on September 13 and 17, 2010, respectively.

*2Available at:
http://www.ftc.gov/os/2003/ 10/innovationrpt.pdf

*3 Source code is the “‘human readable’ programming language” in which computer programmers write their programs. Source code “is then generally converted by the computer into a ‘machine readable code’ or ‘machine language’ expressed in a binary format.” Microsoft Corp. v. AT&T Corp., 550 U.S. 437, 459, 127 S. Ct. 1746, 1760 (2007) (Alito, J., concurring). Commercial software companies such as Microsoft generally distribute their programs in machine readable code, not source code.

*4 Available at:
http://www.cand.uscourts.gov/ cand/LocalRul.nsf/fec20e 529a5572f0882569b6006607e0/ 5e313c0b7e4cd680882573e2006 2dbcf?OpenDocument

*5 Available at:
http://www.txed.uscourts.gov/Rules/LocalRules/Docume nts/Appendix%20M.pdf

*6 Available at:
http://www.ftc.gov/opp/ intellect/020320webbink.pdf

*7 D. Crouch, “USPTO Patent Grant Numbers,” Patently-O Blog, August 19, 2010, available at:
http://www.patentlyo.com/ patent/2010/08/uspto-patent- grant-numbers.html.

(The Patently-O Blog is recognized as one of the leading patent law blogs, if not the leading blog. See, e.g.:
http://blawgit.com/2009/08/ 11/50-best-patent-blogs/ and
http://ipwatchdog.com/ 2009/02/11/the-top-25-patent-blogs/id=2015/)

*8 D. Crouch, “Patent Litigation Statistics: Number of Patents Being Litigated,” Patently-O Blog, March 17, 2008 (noting “an increasing trend to include more defendants in a single complaint”), available at:
http://www.patentlyo.com/ patent/2008/03/patent-litigati.html

*9 State Street was probably overruled in part, at least sub silentio, by this Court in Bilski v. Kappos, 561 US __, 130 S. Ct. 3218 (2010). However, State Street permitted the issuance of broad software patents by being the law for over 10 years.

*10 Available at:
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=831685

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