AT&T sued Microsoft for patent infringement and wants to collect damages for foreign sales under Section 271(f) of the patent act. That section calls for infringement of a US patent if "components" of a patented invention are supplied abroad to be combined as in a would-be infringing manner. Microsoft ships software code abroad that is then copied before being installed in an infringing manner. Microsoft argues that its actions do not satisfy 271(f) because (1) software code itself (separated from a physical disk) cannot be a component because it is not physical and (2) only copies of the code are installed. Notes from the transcript:
Patentable Subject Matter:
MR. OLSON [For Microsoft]: The '580 patent is a program, as I understand it, that's married to a computer, has to be married to a computer in order to be patented.
JUSTICE SCALIA: You can't patent, you know, on-off, on-off code in the abstract, can you?
MR. OLSON: That's correct, Justice Scalia.
JUSTICE SCALIA: There needs to be a device.
MR. OLSON: An idea or a principle, two plus two equals four can't be patented. It has to be put together with a machine and made into a usable device.
JUSTICE BREYER: I take it that we are operating under the assumption that software is patentable? We have never held that in this Court, have we?
MR. JOSEFFER: No, but . . . that's not relevant here . . .
JUSTICE STEVENS: Your time is up, but I want to ask you one yes or no question. In your view is software patentable?
MR. JOSEFFER: Standing alone in and of itself, no.
. . .
MR. WAXMAN [For AT&T]: The code is not patentable.
What is a Component:
MR. JOSEFFER [For the Government]: I think the most important point here is that the components of patented inventions do not have to be patentable. Many patented inventions are comprised of a bunch of parts where the parts themselves would not be patentable because say they were standard off the shelf parts.
MR. OLSON: Physical things must be components under 271(f) because they must be supplied from somewhere. Ideas have no physical from. They're in the air. The words used, "supplied from" tells us that it must be a physical thing combined with. Ideas don't combine with physical things to make a patented invention. Physical things do.
JUSTICE SCALIA: I hope we can continue calling it the golden disk. It has a certain Scheherazade quality that really adds a lot of interest to this case.
Scared that AT&T will Control our Thoughts:
JUSTICE BREYER: But I then would be quite frightened of deciding for you and discovering that all over the world there are vast numbers of inventions that really can be thought of in the same way that you're thinking of this one, and suddenly all kinds of transmissions of information themselves and alone become components. So I'm asking you, is there any outside the computer field analogous instance where the transmission of information has itself been viewed as the transmission of a component?
- The major trouble with Mr. Waxman's argument is that he failed to give a clear enough response that delineates software code from blueprints. I.e., why software code is a "component" of an invention while the blueprints are merely plans for how to make the invention.
- Read the Transcript Here: http://www.supremecourtus.gov/oral_arguments/argument_transcripts/05-1056.pdf