No. 18-956
`
`IN THE
`
`fiupreme Qtnurt at the mutter: States
`
`GCCCLE LLC,
`
`V.
`
`Petitioner,
`
`ORACLE AMERICA, INC.
`
`Respondent.
`
`ON WRIT OF CERTIORARI TO THE UNITED STATES
`
`COURT OF APPEALS FOR THE FEDERAL CIRCUIT
`
`BRIEF AMICUS CURIAE FOR THE AMERICAN
`LEGISLATIVE EXCHANGE COUNCIL IN
`SUPPORT OF RESPONDENT
`
`J ONATHON P. HAUENSCHILD
`
`Counsel of Record
`BARTLETT CLELAND
`
`AMERICAN LEGISLATIVE
`
`EXCHANGE COUNCIL
`
`2900 Crystal Dr., Ste. 600,
`
`Arlington, VA 22202
`
`Main - (703) 873-0933
`
`jhauenschild@alec.0rg
`
`Counsel for Amicus Curiae
`
`
`
`IN THE
`
`fiupreme Qtnurt at the mutter: States
`
`GCCCLE LLC,
`
`V.
`
`Petitioner,
`
`ORACLE AMERICA, INC.
`
`Respondent.
`
`ON WRIT OF CERTIORARI TO THE UNITED STATES
`
`COURT OF APPEALS FOR THE FEDERAL CIRCUIT
`
`BRIEF AMICUS CURIAE FOR THE AMERICAN
`LEGISLATIVE EXCHANGE COUNCIL IN
`SUPPORT OF RESPONDENT
`
`J ONATHON P. HAUENSCHILD
`
`Counsel of Record
`BARTLETT CLELAND
`
`AMERICAN LEGISLATIVE
`
`EXCHANGE COUNCIL
`
`2900 Crystal Dr., Ste. 600,
`
`Arlington, VA 22202
`
`Main - (703) 873-0933
`
`jhauenschild@alec.0rg
`
`Counsel for Amicus Curiae
`
`
`
`i
`
`TABLE OF CONTENTS
`
`TABLE OF CONTENTS .............................................. i
`
`TABLE OF AUTHORITIES ...................................... iii
`
`IDENTITY AND INTERESTS OF AMICUS CURIAE
`
`...................................................................................... 1
`
`SUMMARY OF ARGUMENT .................................... 8
`
`ARGUMENT ............................................................... 9
`
`A. State Economies and the American Economy
`Benefit from Strong Intellectual Property
`Protections ............................................................... 9
`
`B. Property Rights as the Foundation of Copyright
`................................................................................ 14
`
`C. Property Rights and the Progress of Science .. 17
`
`D. Congress Intended for The Plain Text of the
`Copyright Act to Protect Computer Programs ..... 20
`
`E. The Constitution Grants Congress the
`Authority to Change Copyright Standards,
`Including the Definition of Computer Program... 23
`
`F. Originality, the Idea-Expression Dichotomy, and
`the Merger Doctrine .............................................. 24
`
`G. Fair Use is an Equitable Question that
`Requires a Case-by-Case Analysis ....................... 26
`
`1. Fair Use Factor One — The Purpose and
`Character of the Use, Including Whether the
`Use is for a Commercial or Non-Profit Purpose27
`
`2. Fair Use Factor Two — The Nature of the
`
`Copyrighted Work .............................................. 29
`
`3. Fair Use Factor Three — Amount and
`
`Substantiality of the Portion Used In Relation to
`the Copyrighted Work as a Whole .................... 80
`
`
`
`ii
`
`4. Fair Use Factor Four — The Effect of the Use
`
`Upon the Potential Market for or Value of the
`Copyrighted Work .............................................. 82
`
`CONCLUSION .......................................................... 88
`
`
`
`iii
`
`TABLE OF AUTHORITIES
`
`Cases
`
`A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004
`(9th Cir. 2001) .................................................. 27, 29
`
`Apple Computer, Inc. v. Formula International, Inc.,
`725 F.2d 521 (9th Cir. 1984) ........................... 24, 29
`
`Apple Computer, Inc. v. Franklin Computer Corp.,
`714 F.2d 1240 (3rd Cir. 1983) ..................... 6, 22, 29
`
`Atari Games Corp. 1). Nintendo ofAmerica Inc., 975
`F.2d 832 (Fed. Cir. 1992) ....................................... 25
`
`Campbell v. Acuff-Rose Music, Inc., 510 US. 569
`(1994) .............................................................. passim
`
`CDNInc v. Kapes, 197 F.3d 1256 (9th Cir. 1999)
`
`25
`
`E. Bement & Sons 1). National Harrow Co., 186 US.
`70 (1902) ................................................................. 18
`
`Feist Publications, Inc. v. Rural Telephone Services
`Co., Inc., 499 US. 340 (1991) .......................... 24, 30
`
`Harper & Row Publishers, Inc. v. Nation Enterprises,
`471 US. 539, 549 (1985) ............................... passim
`
`Mazer v. Stein, 347 US. 201 (1954) ......................... 24
`
`Oracle America, Inc. v. Google LLC, 886 F.3d 1179
`(Fed. Cir. 2018) ................................................ 19, 28
`
`Oracle America, Inc. v. Google Inc., 750 F.3d 1339
`(Fed. Cir. 2014) .................................. 9, 19, 23,
`28
`
`Sega Enterprises Ltd. v. Accolade, Inc., 977 F.2d
`1510, 1519 (9th Cir. 1992) ........................... 7, 23, 26
`
`Sony Corp. ofAmerica 1). Universal City Studios,
`Inc., 464 US. 417 (1984) ............................... passim
`
`
`
`iV
`
`Statutes
`
`17 U.S.C. § 101 .......................................... 7, 20, 21, 28
`
`17 U.S.C. § 102(a) ................................................ 20, 21
`
`17 U.S.C. § 102(b) .................................................. 7, 25
`
`17 U.S.C. § 107 ...................................................... 8, 27
`
`Other Authorities
`
`ADAM SEGAL, THE HACKED WORLD ORDER (2016).... 13
`
`American Legislative Exchange Council, Resolution
`in Support of Intellectual Property Rights
`Protection (October 16, 2012, reapproved
`November 16, 2017), httpS://WWW.alec.org/model-
`policy/resolution-in-support-Of-intellectual-
`property-rights-protection/ ...................................... 4
`
`BUREAU OF LABOR STATISTICS, OCCUPATIONAL
`EMPLOYMENT AND WAGES FOR COMPUTER
`
`PROGRAMMERS 15-811 (May 2018),
`httpS://WWW.blS.gov/oes/current/oes151131.htm#(1)
`................................................................................ 12
`
`Commission on New Technological Uses of Copyright
`(CONTU), Final Report, 3 Computer L.J. 53 (1981)
`........................................................................ passim
`
`Curt Bramble, Patent trolls spell trouble for
`America’s economy, Reuters, (NOV. 18, 2018),
`http://blogs.reuters.com/great-
`deb ate/20 18/1 1/18/patent-trolls-spell-trouble-for-
`americaS-economy/ .................................................. 2
`
`JAMES GRIFFITHS, THE GREAT FIREWALL OF CHINA
`(2019) ...................................................................... 10
`
`
`
`V
`
`JESSICA NICHOLSON, US. DEPARTMENT OF
`COMMERCE, DIGITAL TRADE IN NORTH AMERICA,
`(January 5, 2018),
`https://www.commerce.gov/sites/default/files/media
`/files/2018/digital-trade-in-north-america.pdf ..... 11
`
`JOHN LOCKE, SECOND TREATISE OF GOVERNMENT
`(Barnes & Noble Books, ed. 2004) (1690) ............. 15
`
`Organization for Economic Co-operation and
`Development (OECD), Enquiries into Intellectual
`Property’s Economic Impact, (2015),
`https://WWW.oecd.org/sti/ieconomy/Chapter5-
`KBC2-IP.pdf............................................................. 8
`
`Randolph J. May and Seth L. Cooper, Liberty of
`Contract and the Free Market Foundations of
`Intellectual Property, Free State Foundation (July
`29, 2016), https://freestatefoundation.org//Wp-
`content/uploads/2019/06/Liberty-of-Contract-and-
`the-Free-Market-Foundations-of—Intellectual-
`
`Property-072916.pdf .......................................... 5, 18
`
`Randolph J. May and Seth L. Cooper, The
`Constitutional Foundations of Intellectual
`Property, Free State Foundation (October 5, 2015),
`https://freestatefoundation.org//Wp-
`content/uploads/2019/06/The-Constitutional-
`Foundations-of—Intellectual-Property-100515.pdf
`............................................................................ 5, 15
`
`Randolph J. May and Seth L. Cooper, The Public
`Contract Basis of Intellectual Property Rights, Free
`State Foundation (April 19, 2016),
`https://freestatefoundation.org//Wp-
`content/uploads/2019/06/The-Public-Contract-
`Basis-of—Intellectual-Property-Rights-041816.pdf.
`................................................................................ 16
`
`
`
`v1
`
`Resolution on the Importance of International
`Intellectual Property Rights Protections, American
`Legislative Exchange Council (September 4, 2015),
`https://WWW.alec.org/model-policy/resolution-on-
`the-importance-of—international-intellectual-
`property-rights-protections/ ................................ 3, 4
`
`US. Chamber of Commerce Global Innovation Policy
`Center, Human Progress: Sustaining the Wave,
`Innovation & Creativity Barometer 2019 Report
`(2019), https://WWW.theglobalipcenter.com/Wp-
`content/uploads/2019/12/028644_GIPC_Barometer
`_Report_20 19_FINv2_WEB.pdf............................ 1 1
`
`US. Chamber of Commerce, Global Innovation
`Policy Center Art of the Possible: U. S. Chamber
`International IP Index, 8th Ed. (2020),
`https://WWW.theglobalipcenter.com/Wp-
`content/uploads/2020/02/GIPC_IP_IndeX_2020_Ful
`lReport.pdf ......................................................... 4, 10
`
`US. CHAMBER OF COMMERCE, GLOBAL INNOVATION
`POLICY CENTER, EMPLOYING INNOVATION ACROSS
`
`AMERICA, https://WWW.theglobalipcenter.com/ip-
`employs-innovation/#ranking (last visited,
`February 13, 2020) ................................................ 11
`
`US. DEPARTMENT OF COMMERCE, INTELLECTUAL
`PROPERTY AND THE US. ECONOMY: 2016 UPDATE
`
`(2016),
`https://WWW.commerce.gov/sites/default/files/migra
`ted/reports/ip-and-the-us-economy-september-
`2016.pdf.................................................................. 12
`
`Constitutional Provisions
`
`US. Const. Art. 1, Sec. 8 .......................................... 14
`
`
`
`IDENTITY AND INTERESTS OF AMICUS
`
`CURIAE
`
`the
`37,
`to Supreme Court Rule
`Pursuant
`American Legislative Exchange Council respectfully
`submits this brief amicus curiae in support of
`Respondent Oracle America, Inc.1
`
`The American Legislative Exchange Council
`(ALEC)
`is a nonprofit,
`tax exempt corporation
`headquartered in the Commonwealth of Virginia for
`the purpose educating state legislators and operating
`as a forum for the exchange of ideas, developing real,
`state-based solutions to encourage growth, preserve
`economic
`security
`and
`protect
`hardworking
`taxpayers. Roughly 25 percent of all state legislators
`are members.
`
`Intellectual property (IP), and the innovation that
`underpins it, are vital US economic drivers and are
`indirectly responsible for millions of American jobs
`that pay higher than average wages. Intellectual
`property rights are property rights and, consistent
`with America’s founding fathers,
`they are natural
`rights. America’s founders linked IP protections to
`natural rights and the social contract underpinning
`
`
`to this Court’s Rule 37.3(a), all parties have
`1 Pursuant
`provided blanket consent to the filing of amicus briefs, which
`consent is on file with the Clerk’s office.
`
`Pursuant to Rule 37.6, Amicus Curiae affirms that no counsel
`for any party authored this brief in whole or in part, and no
`counsel or party made a monetary contribution intended to
`fund the preparation or submission of this brief. No person
`other than Amicus Curiae, its members, or its counsel made a
`monetary contribution to its preparation or submission.
`
`
`
`2
`
`functional governance. They reasoned that inventors
`create property in its tangible and intangible forms
`and the government has a duty to protect both.
`
`For more than a decade, ALEC has provided state
`legislators with information about every facet of IP,
`from the importance of
`incorporating strong IP
`provisions when negotiating trade frameworks to
`fighting counterfeits. While IP protections are the
`responsibility of
`the federation government,
`the
`benefits of strong IP protections are felt in states and
`among the constituencies of ALEC state legislators.
`The employers, innovators, and consumers in each
`state legislative district benefit from the trillions of
`dollars in IP created over the past few decades.
`
`state
`by
`enjoyed
`the benefits
`of
`Because
`legislators’ constituencies, ALEC has highlighted the
`difficulties of protecting trade secrets including from
`leaks by careless federal government agencies and
`offered state legislators a nuanced approach on how
`to deal with patent
`trolls.2 ALEC has submitted
`comments to foreign governments criticizing policies
`that were inconsistent with protecting intellectual
`property within their own nations and globally and
`through a resolution proposed by its state legislative
`members has called for increased funding to the US
`State Department
`to
`strengthen America’s
`International
`IP Attaché program. 3 ALEC state
`
`
`trouble for America’s
`spell
`2 Curt Bramble, Patent
`18,
`2013),
`(Nov.
`economy,
`Reuters,
`http://blogs.reuters.com/great-debate/ZO 1 3/1 1/ 18/patent-trolls-
`spell-trouble-for-americas-economy/.
`
`trolls
`
`3 Resolution on the Importance of International Intellectual
`Property Rights Protections, American Legislative Exchange
`
`
`
`8
`
`link
`also understand the
`legislative members
`between strong IP protections
`and a nation’s
`economic performance. OECD has reported that
`countries with strong IP regimes experience more
`robust economic growth.4 And because Federalism is
`a guiding ALEC principle, ALEC has worked hard to
`ensure that members understand the high regard
`America’s Founders (many of whom held patents)
`had for IP.
`
`While state legislators rarely have jurisdiction
`over IP issues, their constituents include innovators,
`creators, programmers,
`and others who
`enjoy
`protections under
`IP law. Any weakening of IP
`protections will have significant
`impacts in their
`districts, potentially harming both the economies in
`those districts and their constituents. Additionally,
`state legislators often serve as an important conduit
`for
`information both to and from the federal
`
`government to their constituents.
`
`SUMMARY OF ARGUMENT
`
`The United States leads the world in economic
`
`activity related to Intellectual Property (IP) rights
`and protections. U.S. Chamber of Commerce, Global
`Innovation Policy Center (GIPC) Art of the Possible:
`U.S. Chamber International IP Index, 8th Ed. (2020),
`
`
`https://www.a1ec.org/model-
`2015),
`4,
`(September
`Council
`policy/resolution-on-the-importance-of—internationa1-
`intellectual-property-rights-protections/.
`
`4 Organization for Economic Co-operation and Development
`(OECD), Enquiries
`into Intellectual Property’s Economic
`Impact, (2015), Ch. V, Copyright in the Digital Era: Country
`Studies
`https://www.oecd.org/sti/ieconomy/Chapter5-KBC2-
`IP.pdf
`
`
`
`4
`
`https://www.theglobalipcenter.com/wp-
`content/uploads/2020/02/GIPC_IP_Index_2020_FullR
`eport.pdf. As recognized by state legislators through
`the Resolution in Support of Intellectual Property
`Rights Protection of
`the American Legislative
`Exchange Council
`(ALEC),
`“U.S.
`intellectual
`property-intensive industries generate nearly $7.7
`trillion in gross output and account for more than
`60% of total US. exports.”5
`
`The positive impact of strong IP rights and
`protection systems benefits each state. States like
`California, Texas, New York, Pennsylvania, and
`Ohio have enjoyed billions, if not trillions, of dollars
`in trade and investment, tens of millions of jobs, and
`so on. See Employing Innovation Across America,
`US. Chamber of Commerce Global Innovation Policy
`Center,
`https://www.theglobalipcenter.com/ip-
`employs-innovation/.
`
`Many of these benefits can be traced, directly or
`indirectly,
`to decisions in the late 1970s and early
`
`
`
`5 American Legislative Exchange Council, Resolution in
`Support of Intellectual Property Rights Protection (October 16,
`2012,
`reapproved
`November
`16,
`2017),
`https://www.alec.org/model-policy/resolution-in-support-of-
`intellectual-property-rights-protection/,
`accord,
`ALEC
`Resolution on the Importance of International
`Intellectual
`Property Rights Protections, n.3, above (“IP-intensive jobs now
`make up a significant portion of the economy, sustaining
`millions of jobs and adding trillions of dollars to GDP across
`vast sections of the world; and... studies have found that
`nations with laws protecting IPR also perform strongly in
`economic indicators such as Household Income, Gross Domestic
`Product and Foreign Direct Investment”).
`
`
`
`5
`
`1980s to ensure computer programs were subject to
`copyright protections. See Commission on New
`Technological Uses of Copyright
`(CONTU), Final
`Report, 3 Computer L.J. 53, 78-80 (1981)6 (“One of
`the hallmarks of a competitive industry is the ease
`with which
`entrepreneurs may
`enter
`into
`competition with firms already doing business. The
`absence of significant barriers
`to entering the
`program-writing market is striking... New software
`firms may be formed with few people and little
`money; entry into the market has thus far been fairly
`easy” id. at 79). The decisions to extend protections
`to computer programs were rooted in the founder’s
`desire to extend IP rights to inventors and authors.
`
`The founders incorporated the Lockean labor
`theory of property and a general liberty of contract in
`the Constitution. See Randolph J. May and Seth L.
`Cooper, Liberty of Contract and the Free Market
`Foundations of Intellectual Property, Free State
`Foundation
`(July
`29,
`2016),
`https://freestatefoundation.org//wp-
`content/uploads/2019/06/Liberty-of—Contract-and-the-
`Free-Market-Foundations-of—Intellectual-Property-
`072916.pdf and The Constitutional Foundations of
`Intellectual Property, Free State Foundation (October
`5,
`2015),
`https://freestatefoundation.org//wp-
`content/uploads/2019/06/The-Constitutional-
`Foundations-of—Intellectual-Property-100515.pdf.
`
`Property rights and a general liberty of contract
`also form the basis of a free market. When people are
`free to assign or
`sell certain economic rights,
`
`
`6 This brief references the version of the final report found in
`the Computer Law Journal.
`
`
`
`6
`
`economies flourish. The free market works to provide
`benefits to all involved. Innovators are free to sell
`
`protected works, the right to use protected works, or
`the protections themselves.
`
`law seek to
`The Constitution and copyright
`achieve a balance: protect property rights while
`incentivizing innovation. Oracle, and its predecessor
`in interest Sun Microsystems, developed tiered
`licenses
`that
`protected
`property
`rights
`and
`maximized innovation. The tiered licenses provide
`maximum flexibility for software developers, save
`them valuable time and effort, expand the devices
`available for these developers, and protect IP rights
`from competitors.
`
`software
`the
`in
`change
`of
`Google warns
`development market unless this Court overturns the
`Federal Circuit’s decision and rules either that the
`
`Copyright Act of 1976, and its 1980 amendments,7 do
`not protect Application Programming Interfaces
`(APIs) or that fair use protects Google’s copying of
`the Java code.
`
`to
`the Copyright Act
`intended for
`Congress
`protect computer programs. Apple Computer, Inc. v.
`Franklin Computer Corp., 714 F.2d 1240, 1247 (8rd
`Cir.
`1983)
`(“Although section 102(a) does not
`expressly list computer programs
`as works of
`authorship,
`the legislative history suggests that
`programs were considered copyrightable as literary
`works”) This
`intention is evident
`through the
`expansive definition of “literary work,” the 1980
`addition of a definition for “computer program,” and
`
`
`7 17 U.S.C. §§101, et seq.
`
`
`
`7
`
`1980
`the
`that
`understanding
`Congress’s
`amendments adopted the reasoning of the CONTU
`Final Report. Id.
`
`law does not distinguish between
`Copyright
`classes of computer programs including APIs or
`declaring code, instead defining computer programs
`as “a set of statements or instructions to be used
`
`directly or indirectly in a computer in order to bring
`about a certain result.” 17 U.S.C.
`§ 101, Sega
`Enterprises Ltd. v. Accolade, Inc., 977 F.2d 1510 (9th
`Cir. 1992). While copyright law does not distinguish
`between classes of computer programs, just because
`something is created does not mean that it qualifies
`for copyright protection. The law provides that “[i]n
`no case does copyright protection for an original work
`of authorship extend to any idea, procedure, process,
`system, method of operation, concept, principle, or
`discovery,
`regardless of the form in which it
`is
`described, explained, illustrated, or embodied in such
`work.” 17 U.S.C. § 10200).
`
`The Constitution reserves patent and copyright
`standards for Congress. Only Congress can say what
`is, or is not, protected. While Google, or its amici, ask
`the Court to make a determination as to whether the
`
`code in question is subject to copyright protections,
`they could also seek to carve interfaces out from
`under copyright protection via Congressional action.
`CONTU recommended Congress periodically review
`copyright
`law to determine whether the law was
`keeping pace with technological advances.
`
`Any legislation enacted as a result of these
`recommendations
`should be
`subject
`to a
`periodic review to determine its adequacy in
`the light of continuing technological change.
`
`
`
`8
`
`This review should especially consider the
`impact of such legislation on competition and
`consumer
`prices
`in
`the
`computer
`and
`information industries and effect on cultural
`
`values of including computer programs within
`the ambit of copyright.
`
`8 Computer L.J. at 54.
`
`Fair use requires a case-by-case analysis of the
`facts and law. Section 107 of the Copyright Act
`provides the court with a non-exhaustive list of
`factors to weigh when a defendant raises fair use.
`See, Harper & Row Publishers,
`Inc.
`v. Nation
`Enterprises, 471 U.S. 539 (1985). The enumerated
`four factors include:
`
`the purpose and character of the use,
`(1)
`including whether such use is of a commercial
`nature
`or
`is
`for
`nonprofit
`educational
`purposes;
`
`(2) the nature of the copyrighted work;
`
`the amount and substantiality of the
`(3)
`portion used in relation to the copyrighted
`work as a whole; and
`
`(4) the effect of the use upon the potential
`market for or value of the copyrighted work.
`
`17 U.S.C. § 107.
`
`The parties disagree on the specific copyright
`question before the Court with Google phrasing the
`question as “whether copyright protection extends to
`software
`interfaces”
`and Oracle phrasing the
`question as whether “the Copyright Act protects the
`code and organization that Google concedes were
`original and creative and that Oracle could have
`
`
`
`9
`
`written in countless ways to perform the same
`function.” The circuit court had even a slightly
`different take, deciding that “the declaring code and
`the structure, sequence, and organization of the 87
`Java API packages
`are
`entitled to
`copyright
`protection.” Oracle America, Inc. v. Google Inc, 750
`F.3d 1339, 1354 (Fed. Cir. 2014) (hereafter “Oracle
`1”).
`
`ARGUMENT
`
`A. State Economies and the American Economy
`Benefit from Strong Intellectual Property
`Protections
`
`is essential for “protecting computer
`Copyright
`programs, particularly those of small entrepreneurs
`who create their works for individual consumers and
`
`who can neither afford nor properly use other forms
`of protection.” CONTU Final Report, 3 Computer
`L.J. at 67.
`
`Compared to many other industries, computer
`programming is a unique opportunity for individual
`innovators
`to
`enter
`the market
`and
`do
`so
`
`successfully. An innovator need only access to a
`computer, understand how programming languages
`work, and the internet to access other helpful tools.
`“One of the hallmarks of a competitive industry is
`the ease with which entrepreneurs may enter into
`competition with firms already doing business. The
`absence of significant barriers
`to entering the
`program-writing market is striking.” Id. at 79.
`
`This Court’s decision could have a significant
`impact
`on
`innovation within
`the
`computer
`programming field. The Court’s decision will impact
`property rights and determine the effectiveness of
`
`
`
`10
`
`the
`or
`tiered licenses. Licensing requirements,
`freedom to contract, form part of the backbone of the
`American IP system and the foundation of a free
`market generally. Licensing agreements establish
`perimeters, allow innovators access
`to protected
`works, and allow them to build upon those protected
`works. Third,
`the decision is likely to impact the
`United States’ ability to protect IP rights globally. It
`is well known that certain foreign nations—such as
`Russia, China, Kuwait, and Saudi Arabia, among
`others—misappropriate IP routinely and to the
`detriment of the US. economy as well as to all US.
`citizens.8 A decision that would effectively expand
`fair use would be problematic and risk enabling
`copyright theft by bad actors.
`
`IP protection regime has
`The United States’
`inured the economy greatly. The United States is a
`global
`leader in IP and IP protection. Art of the
`Possible, at 253-258. The broad IP field in the United
`States accounts for 45 million jobs and represents
`approximately 38% of GDP. US. Chamber of
`Commerce GIPC, Human Progress: Sustaining the
`
`
`and
`stealing,
`example, has been hacking,
`for
`8 China,
`appropriating IP held by western companies for years. In 2014,
`the US. Department of Justice indicted a number of Chinese
`military personnel
`for economic espionage. At
`the time,
`Attorney General Holder noted the damage such IP theft did to
`the market and stated that “[s]uccess in the global market place
`should be based solely on a company’s ability to innovate and
`compete, not on a sponsor government’s ability to spy and steal
`business secrets.” JAMES GRIFFITHS, THE GREAT FIREWALL OF
`CHINA 189 (2019). Kuwait and Saudi Arabia, on the other hand,
`tend to be hotspots
`for unlicensed software, with some
`estimates of unlicensed software use hovering between 32% and
`57%. See Art of the Possible at 52.
`
`
`
`11
`
`Innovation & Creativity Barometer 2019
`Wave,
`at
`13
`(2019),
`Report
`httpS://www.theglobalipcenter.com/wp-
`content/uploads/2019/12/028644_GIPC_Barometer_R
`eport_2019_FINv2_WEB.pdf. Computer
`software
`represented, aS Of 2016, about $36 billion in exports.
`JESSICA
`NICHOLSON, US.
`DEPARTMENT
`OF
`
`COMMERCE, DIGITAL TRADE IN NORTH AMERICA at 4,
`(January
`5,
`2018),
`httpS://www.commerce.gov/siteS/default/fileS/media/fi
`les/2018/digital-trade-in-n0rth-america.pdf.
`
`specifically
`and more
`Intellectual property,
`economies.
`copyright,
`positively
`benefit
`states’
`Innovators in states like California, Texas, and New
`York hold more than 20,000 patents, copyrights, and
`trademarks in each state.9 Innovators in states like
`
`Pennsylvania, Virginia, Ohio, and Colorado hold
`between 5,000 and 20,000 IP rights in each state.10
`
`significant
`to
`translate
`IP holdings
`These
`economic benefits. For example, California has over
`7.5 million jobs related to IP,
`realizes nearly a
`trillion dollars in sales, and sees over $100 billion
`
`invested in research and development.11 Similarly,
`Texas can claim over 5 million jObS related tO IP,
`realizes about $750 billion in saleS, and sees over $20
`billion invested in research and development.
`
`
`9 US. CHAMBER OF COMMERCE, GLOBAL INNOVATION POLICY
`CENTER,
`EMPLOYING
`INNOVATION
`ACROSS
`AMERICA,
`httpS://www.theglobalipcenter.com/ip-employs-
`innovation/#ranking (last visited, February 13, 2020).
`
`10 Id.
`
`11 Id. at R&D Map.
`
`
`
`12
`
`Pennsylvania can trace over 2.5 million jobs related
`to IP, almost $270 billion in sales, and $14.6 billion
`invested in research and development.
`
`The Bureau of Labor Statistics estimates that as
`
`computer
`230,000
`over
`there were
`2018,
`of
`programming jobs in the United States. BUREAU OF
`LABOR STATISTICS, OCCUPATIONAL EMPLOYMENT AND
`WAGES FOR COMPUTER PROGRAMMERS 15-311 (May
`2018),
`httpS://www.blS.gov/oes/current/oeS151131.htm#(1).
`The number may be higher, as this figure excludes
`those whO are self-employed.
`
`Computer programmers are paid well, with the
`median annual wage of nearly $85,000 per year,
`roughly 46 percent higher than “non-IP-intenSive
`industries). See,
`id.
`and U.S. DEPARTMENT OF
`COMMERCE,
`INTELLECTUAL PROPERTY AND THE US.
`ECONOMY:
`2016
`UPDATE
`at
`19
`(2016),
`httpS://www.commerce.gov/siteS/default/fileS/migrate
`d/reportS/ip-and-the-uS-economy-september-2016.pdf.
`For states like California, Texas, New York, and
`Pennsylvania,
`this means
`that
`their economies
`benefit from between 5,530 and 29,740 well-paying
`jobs. OCCUPATIONAL EMPLOYMENT AND WAGES FOR
`COMPUTER PROGRAMMERS, above.
`
`Because of the benefit from strong IP protections
`that stateS enjoy,
`the Court’s decision is likely to
`Significantly impact their economies, aS well as the
`United StateS’ economy. Any change to the status
`quo is likely to inject uncertainty into the field,
`discourage innovation, and harm America’s status as
`a leader protecting and promoting IP rights.
`
`Changes to the status quo, additionally, are likely
`to have Significant impacts on global IP rights. The
`
`
`
`13
`
`past decade or so has witnessed one of the largest
`involuntary transfers of IP ever. In countries like
`Kuwait, Saudi Arabia,
`and Qatar, people and
`companies pirate
`software—that
`is
`they copy
`software
`and
`distribute
`it
`to
`others
`in
`an
`
`unauthorized manner. China and Russia simply
`steal valuable IP. In 2011, one report claimed that
`“an amount of intellectual property larger than that
`contained in the Library of Congress is stolen from
`networks maintained
`by US.
`businesses,
`universities,
`and government departments
`and
`agencies.” ADAM SEGAL, THE HACKED WORLD ORDER
`65-66 (2016).
`
`Regardless of how the IP theft occurs, it harms
`businesses. For example, American Semiconductor
`controlled the rights to a computer program that
`controlled the flow of electricity from wind turbines.
`The Chinese government was able to steal
`the
`computer program’s
`code
`and,
`consequently,
`it
`“stopped making
`purchases,
`and American
`Semiconductor soon had to announce it had lost its
`
`responsible for close to $210
`biggest customer,
`million in revenue.” Id. at 152. This loss of business
`
`not only harmed the US. economy, it also harmed
`the economy of the state legislative districts in which
`the company was located.
`
`Recently, the United States and China executed
`“Phase One of the Economic and Trade Agreement
`between the United States of America and the
`
`People’s Republic of China.” Through this agreement,
`China has promised to “better define and protect
`rights-holders’ legal interests.” Art of the Possible at
`24.
`
`
`
`14
`
`The ability to prosecute IP theft globally hangs in
`the balance. A wrong step could harm the United
`States’ ability to protect computer program rights-
`holders in the international IP market, providing
`foreign
`nations with
`an
`excuse
`to
`ignore
`international treaties, agreements and standards. An
`inability to prosecute IP rights globally will have a
`significant impact on state economies, job markets,
`and revenue.
`
`B. Property Rights as the Foundation of
`Copyright
`
`“The purpose of copyright is to create incentives
`creative work.” Sony Corp. of America
`v.
`for
`Universal City Studios,
`Inc., 464 U.S. 417, 450
`(1984).
`
`The Constitution grants Congress the power to
`create the national, legal framework for intellectual
`property protections. “Congress shall have power
`to... promote the progress of science and useful arts,
`by securing for
`limited times
`to authors and
`inventors the exclusive right
`to their
`respective
`writings and discoveries.” U.S. Const. Art. 1, Sec. 8.
`
`The idea to promote the progress of science and
`useful arts by granting property interests to authors
`and inventors was not a new idea to the founders.
`
`Instead, they drew upon the ideas of John Locke in
`his Second Treatise on Government. According to
`Locke,
`the roots of property may be traced to the
`fruits of a man’s labor.
`
`Though the earth and all inferior creatures be
`common to all men, yet every man has a
`“property” in his own “person.” This nobody
`was any right to but himself. The “labour”
`
`
`
`15
`
`[sic] of his body and the “work” of his hands,
`we may say are property his. Whatsoever,
`then, he removes out of the state that Nature
`hath provided and left it in, he hath mixed his
`labour with it, and joined to it something that
`is his own, and thereby makes it is property.”
`
`JOHN LOCKE, SECOND TREATISE OF GOVERNMENT 17
`
`(Barnes & Noble Books, ed. 2004) (1690).
`
`The founders expounded, and expanded, upon
`Locke’s ideas. The ideas of the founders eventually
`found their way into the Constitution. Shortly after
`the Constitution’s ratification, James Madison wrote
`an essay entitled “On Property.” In that essay, he
`“offered a broad definition of property, which, he
`said,
`‘in its larger and juster
`[sic] meaning
`embraces everything to which a man may attach a
`value and have a right.’ According to Madison,
`‘A
`man has property in his opinions and the free
`communication
`of
`them.’”
`The Constitutional
`
`above.
`Property,
`Intellectual
`of
`Foundations
`According to the authors,
`through “On Property,”
`Madison demonstrated that the founders “applied to
`intellectual property the Lockean idea that a person
`has a natural right to enjoy the fruits of his or her
`labor,
`regardless of whether
`those
`fruits
`take
`tangible or intangible form.” Id.
`
`the
`As property rights are the foundation for
`Constitution’s Intellectual Property Clause, so also
`are property rights the foundation of the free market.
`The founders understood that “[a] person’s natural
`right to property also includes a natural right to
`assign it or exchange it by contract.” Randolph J.
`May and Seth L. Cooper, The Public Contract Basis
`of
`Intellectual
`Property Rights,
`Free
`State
`
`
`
`16
`
`19,
`
`2016),
`
`(April
`Foundation
`https://freestatefoundation.org//wp-
`content/uploads/ZO19/06/The-Public-Contract-Basis-
`of—Intellectual-Property-Rights-041816.pdf.
`The
`market is nothing more than ability to transfer all,
`or some portion, of rights to another. An author or
`inventor is free to assign IP rights, license them, or
`retain them as he or she sees fit. The Intellectual
`
`Property Clause of the Constitution protects someone
`who progresses science or the useful arts and while
`placing guidelines for protection of the market.
`
`Congress fulfills its constitutional responsibilities
`to pro
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