By Ross Todd, From The Recorder

After six years of fighting over smartphone technology, Oracle Corp. and Google Inc. have never been further apart—nearly $9 billion to put a number on it.
The two giants of Silicon Valley are also at polar extremes when it comes to interpreting the central legal principle in their case and the affect of the U.S. Court of Appeals for the Federal Circuit’s 2014 ruling on it. Beginning Monday, those fights will be aired as Oracle takes its copyright infringement claims against Google to trial for a second time before U.S. District Judge William Alsup of the Northern District of California.
Much has changed at the companies and in the case since the two sides last squared off before a jury in Alsup’s courtroom in 2012. The root of the dispute, however, remains unchanged: Google engineers used basic elements of the Java computer programing language to build the Android mobile operating system and did so without taking a license from Oracle or its predecessor Sun Microsystems, which developed Java.
Although there’s already been one jury verdict, a decision from the Federal Circuit, and court-mandated settlement talks, the companies still have profoundly divergent views of the dispute and its potential dollar value.
Both sides are bringing legal firepower, though some of the roles have shuffled. This time Oracle will be backed by Orrick, Herrington & Sutcliffe, while Google’s trial team, led by Robert Van Nest of Keker & Van Nest, is getting a second shot at trying the case.
In Oracle’s view, Google pilfered copyrighted software code that it should have paid to license when its engineers built Android. With Android’s overwhelming market success, Oracle is seeking as much as $8.8 billion, the amount its expert says the infringement contributed to Google’s bottom line.
Google’s lawyers, on the other hand, contend that its use of Oracle’s copyrighted material in Android was transformative and a fair use under copyright law. Oracle only claimed copyright protection, they contend, after it failed to develop its own Java-based smartphone technology. Even if the jury finds infringement, Google’s expert suggests that the copyrighted material was worth $203 million at most.
The case comes as “technology pushes the boundaries of copyright law,” said Nancy Mertzel, the chair of the intellectual property group at Herrick Feinstein in New York. Should Oracle finally land a verdict, she said, there will be consequences beyond the two companies. “Any time you have a large damages award,” Mertzel said, “it provides some ammunition for plaintiffs to rattle their sabers.”
BACK TO THE FUTURE
Quick history lesson: The companies’ first trial in 2012 was a who’s who of Silicon Valley, with Oracle CEO Larry Ellison and Google leaders Eric Schmidt and Larry Page among those testifying. A jury ruled that Google infringed Oracle’s copyright but deadlocked on fair use. Alsup then upended the muddled verdict, determining that Oracle’s intellectual property—37 packages of Java application program interfaces or so-called APIs—was strictly functional and therefore not copyrightable.
The Federal Circuit reversed Alsup in 2014 but stopped short of deciding whether Google’s copying constituted a fair use, setting up the case for another jury trial.
Orrick appellate expert Joshua Rosenkranz argued for Oracle and his revival of the case on appeal helped land his firm a plum role in the retrial. Orrick has essentially replaced Michael Jacobs of Morrison & Foerster and David Boies of Boies, Schiller & Flexner, who took the lead for Oracle in the initial trial.
In response to questions about Jacobs and Boies, who have been absent from recent hearings, Oracle spokesperson Deborah Hellinger said in an email: “While the other firms continue to assist us, Orrick is our primary trial counsel.” Orrick’s Peter Bicks has done most of the speaking for the company in recent hearings, although partners Annette Hurst and Lisa Simpson have also played prominent roles.
Google, meanwhile, has stuck with its veteran legal team led by Van Nest. His partner Christa Anderson and King & Spalding partner Bruce Baber are poised to reprise significant roles they had in the earlier trial. Both companies have dedicated phalanxes of attorneys and support staff to the case.
With the Federal Circuit having already decided infringement, the trial will tee off by asking the very question that divided the prior jury—is Google’s copying of Java APIs protected as fair use.
As the plaintiff, Oracle will present its opening statement first. But Alsup has allowed Google the first shot to put on its evidence and to give closing arguments, since the company bears the burden to show that its copying was a fair use.
If the jury decides against Google on fair use, the proceedings will advance to a damages phase. Alsup has given each side 15 hours to present testimony during the fair-use phase and five hours for damages.
A 10-person jury will be chosen Monday morning starting, as is customary for Alsup, at 7:30 a.m. At the judge’s urging, both sides have agreed to forego the aggressive Internet research on potential jurors that generally takes place during voir dire.
‘TWO FLAVORS OF KOOL-AID’
Deciding fair use in a copyright case involves evaluating four equally weighted factors: the purpose and character of the use including whether it’s commercial, the nature of the copied work itself, how much material was copied and how substantive it was, and the effect of the copying upon the potential market for the original work.
Google’s lawyers intend to call some of the architects of Android as witnesses in hopes of showing what a small portion the copied API packages are to Android—roughly 0.08 percent of the total code. They’ll also seek to show that the copied material was more functional than creative, and subject to a lower level of protection under the copyright laws—a point on which Alsup quite clearly agrees.
When Android launched, the Google lawyers will explain, Sun Microsystems executives didn’t sue, but publicly and enthusiastically supported Android.
Oracle’s lawyers will counter with internal Google emails that discussed the need to take a license to use the Java APIs in Android. Google, they hope to show, knew it needed to take a license, but instead plowed ahead without one. Potential witnesses include Schmidt and Page, now chairman and CEO at Google’s parent company Alphabet Inc., and Oracle’s Ellison, as well as Oracle co-CEO Safra Catz, Android creator Andy Rubin, and former Sun CEO Jonathan Schwartz.
UC-Berkeley School of Law professor Peter Menell points out that this will be a rare occasion when a fair-use case has been tried to a jury. Menell said that the analysis, which often turns on how transformative the infringing use is to the original, can be tough even for academics.
“There are two flavors of Kool-Aid being served to this jury,” Menell said. “Jury trials are often about who is better at telling their stories” and has the most convincing witnesses, Menell said.
Software industry watchers say the case is bound to have a profound impact on the debate about the value of APIs, which allow software engineers to write programs that can operate across multiple platforms.
Ben Depoorter, a professor at UC-Hastings College of the Law, said that the Federal Circuit’s decision on the copyrightability of the Java APIs was seen as detrimental to small developers who wanted to incorporate existing APIs to make programs interoperable. Defending a copyright infringement claim, even with a strong fair-use defense, is an expensive prospect for a small developer and could stifle innovation, he said.
On the other hand, some large software companies such as Microsoft-backed Oracle’s position on APIs arguing that copyright protection provides economic incentive to innovators and deters IP thievery.
Even if Google now prevails on fair use, it won’t set back the clock, Depoorter said. “A fair-use win for Google is very different than what a win in the Federal Circuit would have been.”
DOUBLE THE EXASPERATION
The return trip to Alsup’s courtroom has once again put the judge in the role of referee, taskmaster and potential decider. As in the first trial, Alsup has opted to try infringement and damages in separate phases.
In the run-up to trial, he has issued orders that ooze exasperation with the companies and their counsel. “Both sides,” he scolded, “have repeatedly tried to squeeze too much out of” the appellate decision in the case. And responding to the companies’ volumes of pretrial motions, he reflected, “It would have helped immensely had counsel stipulated to certain needlessly contentious points” rather than fighting over every little thing.Alsup referred the case to U.S. Magistrate Judge Paul Grewal for settlement talks before both trials, and he fared no better in getting the companies and their lawyers to break their impasse.
Grewal aptly summed up the state of play in April: “After an earlier run at settling this case failed, the court observed that some cases just need to be tried,” Grewal wrote. “This case apparently needs to be tried twice.”
For more on this story go to: http://www.therecorder.com/id=1202757105206/Huge-Sums-at-Stake-in-OracleGoogle-Rematch#ixzz48AKB2UYh