JOLT Digest

Fifth Circuit Reverses Summary Judgment for Plaintiffs’ Breach of Contract Claim
By Nathan Lovejoy – Edited by Avis Bohlen

The Compliance Source, Inc. v. GreenPoint Mortgage Funding, Inc., __ F.3d __, 2010 WL 4056112, No. 09-10726 (5th Cir. Oct. 18, 2010)
Slip Opinion

In Compliance Source, Inc. v. GreenPoint Mortgage Funding, Inc., the United States Circuit Court for the Fifth Circuit reversed and remanded the decision of the United States District Court for the Northern District of Texas, which had granted summary judgment in favor of the defendant, a software licensee, on the plaintiffs’ claim for breach of contract. The court also affirmed the district court’s grant of summary judgment to the plaintiffs on the defendant’s counterclaim for breach of their settlement agreement.

The Fifth Circuit held that the license agreement for licensor’s database technology did not permit the licensee to authorize third-party use, even if such use was on behalf or for the benefit of the licensee. In so holding, the court took a narrow approach to its interpretation of the agreement, distinguishing the license in GreenPoint from earlier cases in light of its clear withholding of rights not expressly given.

The Internet Cases blog provides a brief overview of the case. WTN News features an analysis that discusses how the decision might leave open the possibility that a breach claim could extend to situation where third parties merely access software or technology licensed under similar terms. (more…)

Fifth Circuit Limits DMCA by Distinguishing Circumvention to Access Software and Circumvention to Violate Copyright
By Ian B. Brooks – Edited by Helen He

MGE UPS Systems, Inc. v. GE Consumer and Indus. Inc., No. 08-10521 (5th Cir. July 20, 2010)
Slip Opinion

The Fifth Circuit affirmed the ruling of the District Court for the Northern District of Texas, which dismissed MGE UPS Systems Inc.’s (“MGE”) Digital Millennium Copyright Act (“DMCA”) claim against Power Maintenance International, Inc. (“PMI”) and General Electric Company (“GE”) pursuant to Fed. R. Civ. P 50(a).

The Fifth Circuit held that the DMCA’s provisions apply to protections designed to prevent infringement of copyrighted material and not protection from mere access to that material.  Thus, the circumvention of a protection measure that fails to shield the copyrighted material from being read and copied is not a violation of the DMCA.  The court further noted that once a protection measure has been circumvented, the DMCA no longer applies to the use of that work.

Barry Sookman provides an overview of the case and an analysis of the court’s ruling.  Info/Law has a critical discussion of the DMCA in light of this case’s holding. (more…)

By Kassity Liu JD ’12
Edited by Joey Seiler
Editorial Policy

On October 6, 2009, Eolas Technologies Inc., a research and development company specializing in web solutions, filed a federal lawsuit in the Eastern District of Texas against 23 prominent companies in the software and Internet industry. Eolas claims that these companies are infringing two of its patents, U.S. Patent No. 5,838,906 (’906 Patent) and U.S. Patent No. 7,599,985 (’985 Patent). These two patents cover technology that enables websites to act as platforms for fully integrated embedded applications. The ’906 Patent was granted in November 1998. It defines a system that would allow Internet users to access and execute an embedded program. The ’985 Patent, which was granted on the same day that the company filed its present lawsuit, extends the reach of the older patent to AJAX (asynchronous JavaScript and XML) applications.

The present suit is not Eolas’ first. In a previous patent infringement suit, Eolas targeted Microsoft, claiming that the company had infringed its ‘906 Patent. Eolas alleged that its invention, which was first demonstrated at a SIGWEB meeting in 1994, was the “first instance where interactive applications were embedded in Webpages.”[1] The district court sided with Eolas, and the jury awarded Eolas $521 million in damages.[2] Microsoft appealed this decision, but after unsuccessful attempts at moving the case to the Supreme Court and invalidating the patent, the software giant chose to settle with Eolas. (more…)

Court extends application of Bilski and invalidates patents
By Kate Wevers – Edited by Amanda Rice

H&R Block Tax Servs., Inc. v. Jackson Hewitt Tax Service, Inc., No. 6:08-cv-37 (E.D. Tex. Nov. 10, 2009)
Slip Opinion (hosted by Patently O)

Magistrate Judge Love, sitting in the United States District Court for the Eastern District of Texas, found several of H&R Block’s financial instrument patents invalid, and recommended that Jackson Hewitt’s motion for summary judgment be granted-in-part.

The court applied the machine-or-transformation test from In re Bilski, 545 F.3d 943 (Fed. Cir. 2008), cert. granted 77 U.S.L.W. 3656 (U.S. Jun. 1, 2009) (No. 08-964), to H&R Block’s computerized systems patents as well as to its methods patents. In so doing, the court extended Bilski beyond process patents. Only one of the patents survived the machine-or-transformation test and the remaining patents were held invalid under 35 U.S.C. § 101.

The original complaint is available here. Patent Storm has a helpful explanation of one of the patents. Patently O and the 271 Patent Blog both provide brief summaries of the case. (more…)

Content by Vera Ranieri

Google Sued for Use of Trademarked Terms in Adwords Program

A class action was filed against Google on May 11, 2009 in federal court in Texas challenging its use of trademarked terms in its adwords program. The New York Times covered the case and surrounding issues. Ars Technica analyzes Google’s new AdWords policy.

ACLU Challenges Constitutionality of Gene Patents

The ACLU filed suit in the Southern District of New York challenging the patenting of genes and genetic tests as unconstitutional. The New York Times reported on the suit and the ACLU’s plaintiff. Patently-O provides further analysis and links to the ACLU blog and the complaint.