While America’s top court deliberates on a long-fought court case between U.S. tech giants Oracle Inc. and Alphabet Inc.'s Google, experts say Canada’s software sector should be watching closely and take steps to navigate the U.S. legal system more strategically.
Oracle claims Google owes it more than US$8-billion in copyright damages in the decade-old dispute that received an oral hearing of more than 90 minutes before the U.S. Supreme Court last Wednesday. Oracle, which owns the programming language Java, argues that Google plagiarized when it lifted more than 11,000 lines of computer code from Java to create its now ubiquitous Android operating system for mobile devices.
Oracle has argued in legal filings that Google’s actions were akin to swiping the structure of one of J.K. Rowling’s Harry Potter novels – copying the chapter titles and topic sentences of each paragraph while paraphrasing the remainder.
Google, meanwhile, has compared its use of Java to following a standard system of organization, such as a filing cabinet, drawers and hanging folders. It says this was “fair use” and followed a long-standing practice in the software industry of reusing interfaces.
While both companies have scored victories at lower courts, Google has continued to enjoy the benefits of its original use of the Java technology as the legal process drags out.
A final ruling in the battle of the tech titans will not directly apply to Canada, but the case should serve as a warning to the country’s software sector, which is primarily composed of small and medium-sized businesses, said Natalie Raffoul, managing partner of Ottawa-based intellectual property law firm Brion Raffoul.
Many early-stage companies rely on open-source products to build their own technology, she said, and often don’t know or follow the rules around licensing. On the flip side, Canadian businesses might not be aggressive enough about protecting their own proprietary software code.
“This is a cautionary tale for our technology companies.” Ms. Raffoul said "We need to make sure our companies are savvy when it comes to copyright. I think for the most part, a lot of our companies think copyright has to do with artistic works and forget the extent to which it really applies to the software realm.”
Jim Hinton, an IP lawyer and founder of legal and business strategy firm Own Innovation, said Canadian companies should study Google’s playbook and how it uses the legal system to its advantage. While other players had paid Oracle to license the use of the Java code, he said, “Google made a business decision to say, ‘We’ll take our chances in court.’ ”
Canadian companies following the Oracle-Google dispute should make note of how “integrated the parties to this case are with the legal system itself," Mr. Hinton said. “This is how IP is played. It’s about influencing the rules to affect the outcome, not just taking the rules and sort of thinking, ‘Well, that’s that.’ ”
“You have to know it and navigate it," he said, saying that with the dominance of the U.S. and China in global technology markets, Canadian companies need to be aware of the IP landscape in those countries and more strategically navigate the legal systems to their advantage.
This all makes Canada’s own copyright rules less significant for Canadian software companies, Mr. Hinton said.
“The great thing about software is you create it once and sell it 1,000 times for no additional cost. So you want it to be global, you want it to be at scale. So who cares about domestic [Canadian] balance in copyright?”
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