CHAMPAIGN, Ill. – Four cases before the U.S. Supreme Court focus on issues involving intellectual property, the specialty of University of Illinois law professor Paul Heald, who offers his take on each case:
- Alice Corp. v. CLS Bank
Heald said he hopes the Supreme Court reinvigorates the “machine or transformation” test.
“The Supreme Court and the U.S. Court of Appeals for the Federal Circuit have been grappling with software patents for a long time,” said Heald, the Richard W. and Marie L. Corman Research Professor of Law at Illinois. “The federal circuit finally came up with a workable test in Bilsky v. Kappos a few years ago – the machine or transformation test.”
According to Heald, in order to be a patentable subject matter, you have to claim you’ve invented a machine or a method that transforms one thing into something else.
“The Supreme Court said that test is too narrow, but didn’t provide lower courts with a new test,” he said. “Chaos ensued, but hopefully the court will clear things up with the Alice Corp. case, which, to my mind would entail going back to this machine and transformation test. That also would have the benefit of harmonizing us with the European Union, which is pretty important. That way, we would both have the same test for patentable subject matter. It’s confusing now, but it could be very simple if the Supreme Court sees fit.”
- Limelight Networks v. Akamai Technologies
Heald said an innovative ruling by the federal circuit could have ramifications for increasing the scope of patent infringement liability.
“The rule has always been, sensibly, that there has to be a direct infringer. You can’t be secondarily liable when nobody actually violated the patent,” he said. “But the federal circuit changed that rule in Limelight. In theory, no one can be indirectly liable for patent infringement without a direct infringer. But the federal circuit found a situation where it’s possible, and found an inducement of patent infringement even if technically there’s no one who committed a direct infringement. That could open the floodgates to all sorts of new infringement claims. It will be interesting to see what the Supreme Court does with it.”
- POM Wonderful v. Coca-Cola
The popular maker of pomegranate juice is suing the beverage behemoth for selling a pomegranate and blueberry drink that contained less than 1 percent pomegranate and blueberry.
“It’s a false advertising claim – and a pretty strong one – against Coke,” Heald said. “Coke replies that under FDA labeling rules, what we’ve done is permissible. It’s OK under FDA rules to have a nonprimary ingredient be listed prominently on your label. POM says you have to comply with false advertising and FDA labeling regulations because we need to protect consumers.”
According to Heald, a misguided ruling could potentially do away with a raft of false advertising suits.
“If the court rules in Coke’s favor, you could see a really important layer of consumer protection from false advertising stripped away,” he said.
- ABC v. Aereo
In ABC v. Aereo, the court will consider a provision of the Copyright Act – specifically, what constitutes a public performance.
“On its face, this case seems like an easy win for ABC,” Heald said. “You can’t just publicly rebroadcast all of the major networks and charge consumers to see the programs on your website. So you would think that this case would have been over a long time ago.”
But Aereo argues that their service isn’t a public broadcast, based on the language of the Copyright Act and some precedent. And their argument is actually somewhat plausible, Heald said.
“Their service describes a little button for each of their subscribers that acts as a mini-dish that picks up a signal,” he said. “Aereo argues that what they’re doing is not publicly performing any of these shows – they’re just doing 100,000 private performances to each of these individual consumers.”
Aereo’s reasoning may sound unorthodox, except it’s essentially the same argument that allows cable TV subscribers to have digital video recorders, Heald said.
“That’s the argument that Aereo is making: We’re just like Comcast with their DVR boxes,” he said. “So everyone is up in arms about this: No one wants their DVRs to go away but most people also think what Aereo is doing is particularly sleazy. And it’s difficult in the Copyright Act or in prior precedent to distinguish that.”
One of the questions the court may consider is if Aereo is really hurting ABC, Heald said.
“You could argue that Aereo is increasing advertising revenue for ABC, so maybe they’re not hurting anyone at all,” Heald said.
Overall, it really just demonstrates the problem with the Copyright Act, which is that there’s no real good definition of what a public performance is, Heald said.
“The Supreme Court is kind of stuck with all this old language and case law that doesn’t really fit the problem at hand,” he said. “Eventually, Congress is going to have to figure it out, because the statute was drafted way before we had things like DVRs and satellite broadcast.”
To contact Paul Heald, call 217-265-5422; email heald@illinois.edu.
