Amicus Curiae Brief — Microsoft Corp. v. AT & T CORP.

0 SOA

2) | FILED

No. 05-1056 | OFC 15 2006

In the OFFICE OF THE CLERK

| SUPREME COURT, U.S.

Supreme Court of the Un es

MICROSOFT CORPORATION,

Petitioner,

V.

AT&T CORPORATION,

Respondent.

On Writ of Certiorari to the

United States Court of Appeals

for the Federal Circuit

BRIEF FOR AMICUS CURIAE

AUTODESK, INC. IN SUPPORT OF PETITIONER

ROBERT E. HILLMAN JOHN DRAGSETH

FRANK E. SCHERKENBACH = Counsel of Record

225 Franklin Street STEPHEN SCHAEFER

Boston, MA 02110 FISH & RICHARDSON P.C.

60 South Sixth Street

Suite 3300

Minneapolis, MN 55402

Attorneys for Amicus Curiae

2006 - Bachman Legal Printing & (612) 339-9518 @ 1-800-715-3582 @ Fax (612) 337-8053

TABLE OF CONTENTS

Ee CIT iichictiiatitintinretncsiinvegrcemicinsiiiecmiaiinniis i

TABLE OF AL TIIORE TERS. .....00ce.coccrcceressevecsvensszecevesecveneosss il

INTEREST OF THE AMICUS CURIAE ........cccceccccsssssseseeeee ]

SUMMARY OF THE ARGUMENT..............ccccessseerseeseesenes 2

SIO -seiniccscnteititacnanisnilaliiiiciniadhnivnataipaaniuhstiisiaiccvaialinidibie 2

A. Section 271(f) Requires That the Component Supplied

From the United States Be the Very Same Component

Sy ris cncnsinseiitingsnstscanitamcdniainmvagatibicnninegietuibiien 2

B. The Federal Circuit Majority Never Distinguished

Between “Software” as an Idea And “Software” as a

IN I IIR csisc tnsssnishapitndcnalietesmdienniicniamidgindebstinngtietbeaainiotan 4

REAP ETED sieiicntiniadbicesiningsintecsaipeimididagsentiassanioniaeiee 1]

TABLE OF AUTHORITIES

Cite

Cases

AT&T Corp. v. Microsoft Corp.,

414 F.3d 1366 (Fed. Cir. 2005)... eee

Deepsouth Parking Co. v. Laitram Corp.,

TI OR a

Eolas Techs. Inc. v. Microsoft Corp.,

399 F.3d 1325 (Fed. Cir. 2005) .....cccsssssecssssseeee

In re Lowry,

32 F.3d 1579 (Fed. Cir. 1994)............cccscessssssees

Pellegrini v. Analog Devices, Inc.,

375 F.3d 1113 (Fed. Cir. 2004)... ccc eeeeeeeeees

Symbol Techs., Inc. v. Opticon, Inc.,

935 F.2d 1569 (Fed. Cir, 1991) ........cccseeesceeeees

Federal Statutes

PP lass AT WE siicsninnicnaginitinaiehinasiongbbiacnisnisiniialesh

1

INTEREST OF THE AMICUS CURIAE '

This case has been framed by the parties and the

Federal Circuit as a case about “software,” and the

amicus certainly knows software very well. Auto-

desk is the developer of numerous two-dimension

and three-dimension computer design and drafting

software applications, with over 7 million registered

users throughout the world. Autodesk’s AutoCAD

applications make up the preeminent platform for

design and drafting. And its other products extend

the design process in numerous directions that en-

able its customers to create structures they could

never before create, and to communicate those struc-

tures in even further new and useful ways.

With all that said, the amicus does not believe

this case should be viewed as a “software” case. That

is because the term “software” poorly frames the le-

gal issue on appeal, and because the amicus believes

the Federal Circuit majority has created a software-

specific rule where there is no basis in the statute or

logic for such a special rule. The amicus does not

take any position on the specific factual merits of the

patent or defenses asserted in the present case.

1 Counsel for a party did not author this brief in

_ whole or in part, and no party other than Amicus

made a contribution toward the preparation and

submission of this brief. All parties have consented

in writing to the filing of this brief, and their letters

of consent have been filed with the Clerk.

SUMMARY OF THE ARGUMENT

Autodesk writes to clarify two points that led the

Federal Circuit’s two-judge majority off track. First,

the Federal Circuit, by focusing only on a so-called

“component” isste in its Eolas decision, and then fo-

cusing on a so-called “supplied” issue in the present

appeal, failed to read the entire statute together—

which requires that the component that is supplied

from the United States be the very same compo-

nent that is combined in a foreign country. Second,

by framing its analysis entirely around the general

concept of “software,” which describes several differ-

ent things, the Federal Circuit missed a fundamental

distinction between “software” as a non-physical

idea, and “software” as a physical product—a distinc-

tion that makes all the difference in this case. In

combination, these two errors caused the Federal

Circuit majority to find liability even though the only

possible “component” in this case is a golden master

disk, and that disk is never combined outside the

United States.

The amicus believes that the other issues on ap-

peal have been well-raised by the parties, and there-

fore does not comment on them.

ARGUMENT

A. Section 271(f) Requires That the Component

Supplied From the United States Be the

Very Same Component Combined Overseas

The Federal Circuit has addressed Section 271(f)

in two appeals that are key here—and each time it

3

addressed only part of the statute. In Eolas Tech-

nologies, Inc. v. Microsoft Corp., 399 F.3d 1325, 1339

(Fed. Cir. 2005), the Federal Circuit considered

whether software could be a “component” of a pat-

ented invention, while in the present appeal, it con-

sidered whether software could be “supplied” from

the United States. Each time, it answered the ques-

tion in the affirmative.

But this parsed reading of the statute fails to ad-

dress the fact that Section 271(f), when read in full,

connects the component that is supplied to the exact

same component that is combined overseas:

Whoever without authority supplies or

causes to be supplied in or from the United

States all or a substantial portion of the

components of a patented invention,

where such components are uncombined in

whole or in part, in such manner as to ac-

tively induce the combination of such

components outside of the United States in

a manner that would infringe the patent if

such combination occurred within the United

States, shall be liable as an infringer.

35 U.S.C. § 271(f(1).2

Applying the statute in its entirety to this case,

the golden master disk is never one of “such compo-

nents” that is combined outside of the United States

even if it is considered a “component” that is “sup-

plied” from the United States. Rather, the informa-

* Sub-section 2 of the statute is to the same effect. See 35

U.S.C. § 271(f)(2) (“...that such component will be com-

bined outside of the United States...” (emphasis added)).

4

tion on the disk is copied onto a separate disk that

then goes into the foreign-made computer.

Judge Rader recognized this problem in his dis-

sent below. He expressed his belief that, when he

was authoring the Eolas decision, he was only being

asked to determine whether the golden master disk

could be a “component” of a patented invention.

When he was asked to address the rest of the stat-

ute, he understood that it could not be properly ap-

plied because Microsoft’s supply of master disks was

distinct from any supplying of copied disks that ac-

tually went into the computers. AT&T Corp. v. Mi-

crosoft Corp., 414 F.3d 1366, 1373-75 (Fed. Cir. 2005)

(Rader, J., dissenting).

The way in which the majority below appears to

have gotten around this problem is the second—and

more fundamental—point of confusion by the major-

ity below.

B. The Federal Circuit Majority Never Distin-

guished Between “Software” as an Idea And

“Software” as a Physical Product

The Federal Circuit majority’s conclusion in this

case flowed directly from its statement that “soft-

ware code” is patentable. See 414 F.3d at 1369-72.

Under the majority’s rationale, software can be a

patentable invention, so a portion of the software can

be a “component” and can be “supplied” from the

United States under Section 271(f).

All of that may be true, but it fails to distinguish

between software as an idea or information, and soft-

ware as an actual, physical product in the form of a

golden master disk. Software as an idea or informa-

5

tion is intangible, while software as a product is tan-

gible, in the form of bits stored on a particular piece

of media (e.g, CD ROM, hard drive, Flash USB

drive, and memory chips).

The distinction is important, because to find li-

ability, the majority had to have considered software

in its tangible, product sense—i.e., the golden master

disk itself—as the “component,” but to have consid-

ered software in its intangible, idea sense for the rest

of the statute, because only the ideas (as copied onto

another disk), and not the physical product, are ever

combined into a complete apparatus outside the

United States. In the end, the majority centered its

lexicon, and by natural extension, its analysis,

around a term—‘“software”’—that is singularly con-

fusing and non-descriptive in the context of this case.

Like other terms in this appeal that have been ban-

died about—e.g., “code” and “programs’—the term

“software” can be viewed by some as the non-

actionable information, and by others as actual,

physical product.

Numerous other descriptors that distinguish an

idea or information from the product that carries

forth the idea or information are much more descrip-

tive and useful here than are terms such as “soft-

ware’ or “code.” For example, each pairing below

clearly distinguishes between that which might be a

“component,” from that which is embodied, but is dif-

ferent from, the component:

Idea, information Product, implementa-

: tion, embodiment, in-

stantiation

Non-physical Physical

Mere algorithm Application of the al-

gorithm

Mere data Use of the data

Intangible Tangible

If the majority had recognized the key distinction

between software as an idea, on the one hand, and

software as a physical product on the other, it would

have encountered numerous problems with its

analysis, and not just those pointed out by Judge

Rader in his dissent.

First, a prior Federal Circuit panel had already

recognized in 2004 that exporting ideas or informa-

tion does not violate Section 271(f). In Pellegrini v.

Analog Devices, Inc., 375 F.3d 1113, 1117-18 (Fed.

Cir. 2004), the exported information was designs and

instructions for-making computer chips, and the Fed-

eral Circuit indicated that more was required than

supply of intangible information (though carried on

tangible paper or electronic storage devices) for cre-

ating tangible products overseas:

[Section] 271(f) is clear on its face. It

applies anly where components of a

patent invention are physically pre-

sent in the United States and then

either sold or exported ‘in such a

manner as to actively induce the com-

bination of such components outside

the Untied States in a manner that

would infringe the patent if such com-

bination occurred within the United

States.’

x**xe«eek

7

“{SJuppl[{ying] or causfing] to be

supplied” in §271(f) clearly refers to

physical supply of components, not

simply to the supply of instructions or

corporate oversight.

375 F.3d at 1117-18 (emphasis added).

The Federal Circuit majority here brushed Pelle-

grini aside by noting that it involved export of in-

structions for making a component, but not the com-

ponent itself. AT&T, 414 F.3d at 1370. But because

of the majority’s non-discriminating view of “soft-

ware,” it failed to recognize that it is the intangible

instructions from the golden master that produce

the disk that is ultimately combined outside the

United States, and not the tangible golden master

itself. In short, the court’s distinction over Pellegrini

was wholly circular and was tied to its misuse of the

term “software.”

_

Second, even if intangible information or ideas

could, in theory, be “components” of a patented in-

vention, they definitely cannot in this case. As both

Microsoft and AT&T have recognized, the invention

in this case is a “speech-encoding apparatus.” See,

e.g., AT&T Brief in Opposition, at i. Claim 24 of the

patent defines that invention:

24. Apparatus for encoding a speech pattern

comprising

means for partitioning a speech pattern

into successive time frames;

means responsive to the frame speech pat-

tern for generating for each frame a set of

speech parameter signals;

8

means responsive to said frame speech pa-

rameter signals and said frame speech pat-

tern for generating a signal representative of

the differences between said frame speech

pattern and said frame speech parameter

signal set;

means responsive to said frame speech pa-

rameter signals and said differences repre-

sentative signal for generating a first signal

corresponding to said frame speech pattern;

means responsive to said frame speech pa-

rameter signals for generating a second

frame corresponding signal;

means for generating a signal correspond-

ing to the differences between said first and

second frame corresponding signals; and

means responsive to said frame differences

corresponding signal for producing a third

signal to modify said second signal to reduce

the frame differences corresponding signal.

The claimed apparatus is physical because

“means” limitations recite physical structure.’ Thus,

a component, or sub-part, of the apparatus would

also have to be physical. While the ideas or informa-

> Each of the separate so-called “means” limitations indi-

rectly incorporates particular physical structures from the

patent specification under the dictates of 35 U.S.C. § 112,

para. 6. See, e.g., Symbol Techs., Inc. v. Opticon, Inc., 935

F.2d 1569, 1575 (Fed. Cir. 1991) (“[Tjhe scope of [a claim

that recites a ‘means’ for performing a function] is confined

to structures expressly disclosed in the specification and cor-

responding equivalents.’’).

9

tion of the software may be implemented by por-

tions of the apparatus, those non-physical ideas or

information cannot be viewed logically as compo-

nents, or sub-parts, of the physical apparatus. The

AT&T claims also fit into the larger world because

this Court and the Federal Circuit have repeatedly

announced that software as a mere idea is not pat-

entable because it does not fit into any of the catego-

ries of patentable subject matter under 35 U.S.C. §

101. See, e.g., In re Lowry, 32 F.3d 1579, 1583 (Fed.

Cir. 1994) (distinguishing non-patentable subject

matter of “merely the information content of mem-

ory” from patentable subject matter of claims that

“require specific electronic structural elements which

impart a physical organization on the information

stored in memory’).

At bottom, the Federal Circuit majority—focusing

on the term “software,” rather than on the “patented

invention” as commanded by Section 271(f)—never

addressed the actual claims of the patent, which de-

fine the invention. The court never identified the

“invention”—a necessary predicate to identifying the

components of the “patented invention.” If it had, it

would have recognized that “the invention” is physi-

cal, so that the ideas and information represented by

“software” cannot be considered to be “components”

in this case.

In the end, the Federal Circuit majority has built

a special rule for software, where the statute pro-

vides no basis for such a rule. The proper and gen-

eral rule is that, while physical products can be com-

ponents that are supplied and are combined over-

seas, ideas or information cannot. In short, the

Pellegrini panel got it right.

10

This distinction—between information and prod-

ucts, between tangible and intangible, between the

physical and the meta-physical—is a sensible rule

that applies uniformly to all technologies (just like

Section 271(f) does), including to areas that are not

as admittedly complex to conceptualize as is soft-

ware. Thus, for example, the export of a tire mold

that “encodes” a particular functional and patented

tire tread does not produce infringement for every

single tire made overseas, where the mold itself is

not combined overseas. The export of blueprints that

encode information for building a device that might

be covered by a patent does not produce infringe-

ment. And the e-mailing of a patent (which pre-

sumably contains information needed to practice the

patent) to someone outside the United States does

not give rise to liability either.4 The underlying dis-

tinction between ideas and information, on the one

hand, and physical products, on the other, provides a

uniform construct for analyzing Section 271(f), and is

fully consistent with the focus on physical compo-

nents in Deepsouth Packing Co. v. Laitram Corp.,

406 U.S. 518 (1972), and the enactment of Section

271(f) in response to Deepsouth.

* The Federal Circuit majority brushed aside an analogy like

these by asserting that software is “a different type of tech-

nology.” 414 F.3d at 1372. It certainly is different, but not in

any way that affects the proper Section 271(f) analysis or

otherwise makes a difference. Indeed, compact disks them-

selves encode data in molded or burned pits. The analogies

are thus very important to understand whether Section 271(f)

is being read in a manner that is logical and can be applied

consistently in the future.

11

CONCLUSION

For the foregoing reasons, the Amicus urges the

reversal by this Court of the Federal Circuit's deci-

sion finding liability under Section 271(f).

Respectfully submitted,

ROBERT E. HILLMAN JOHN DRAGSETH

FRANK E. SCHERKENBACH Counsel of Record

Fish & RICHARDSON P.C. STEPHEN SCHAEFER

225 Franklion St. FISH & RICHARDSON P.C.

Boston, MA 02110 60 S. 6 St. — Suite 3300

Minneapolis, MN 55402

Attorneys for Amicus Curiae