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District of California is appeal number 171118.

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The case returns to us after an earlier visit here and following a remand and a retrial.

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It's my understanding that you want to reserve five minutes for rebuttal.

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Is that correct, Mr. Rosenkrantz?

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Yes, Your Honor.

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Okay.

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You may begin.

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Thank you, Your Honor.

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May it please the court, Josh Rosencrantz representing Oracle.

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Your Honor, I'd like to spend my time this afternoon focusing on two topics.

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The first is Jamal unfair use, which I will get to in a moment.

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The second is the one-two punch of the district court's decision to cut key evidence of key markets out of the case, followed by Google's misrepresentation, which together

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left the jury with less than half the story on the two most important fair use factors.

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To start with Jamal, there is no case upholding fair use where an infringer copied so much, put it in a competing commercial product, admitted that the whole point of the use was to appeal to the fan base, and in particular what was familiar to the fan base,

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and then succeeded in borrowing the original author from a lucrative new market.

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In any other context, a competitor simply cannot do what Google did.

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You can't take the most recognizable portion of a short story, adapt it into a film, and then defend by saying you were in books, we were in films, different context.

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Or you could not have made a good movie anyway, so where's your production facility, for example?

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Did you ask the court to instruct the jury that merely moving the use from one vehicle to another is not sufficient to make it transformative?

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Yes, Your Honor.

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I mean, there were all sorts of fair use, transformative use instructions that we raised to the district court.

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And the district court went with sort of a montage of this court's instructions,

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But I would hasten to add what matters under Ninth Circuit law for purposes of Jamal is what the law is, not what the jury instructions were.

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And the question of transformative use is a pure issue of law.

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There is literally not a single fact that is in dispute here that would change the answer to the transformative use question.

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Well, and that's important, because as I understand, the Ninth Circuit

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with respect to how we review these questions, all the historical facts are to be reviewed with deference, but the ultimate legal conclusion is review de novo.

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So the question is, what are the historical facts?

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When we've got a black box verdict, it's difficult to clear them out.

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Well, Your Honor, so first I'll preface by pointing out that fair use cases almost never get to juries in the Ninth Circuit, actually, or anywhere else, and precisely

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what you said, Your Honor, which is Ninth Circuit law is exactly what you just quoted.

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So historical facts.

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Historical facts are the who, what, where, when, how, how much.

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None of that is disputed.

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At least I should say there is no dispute of material fact, which this Court focused on last time around, no dispute that would change the answer to any fair use factor, much less

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the balance among all of the factors.

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So this court, to say it more... Can you address specifically the potential market?

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It's practically a factor by itself, but anyway, it's written expressly into factor four.

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Is that a historical fact, whether Oracle had a potential market in the carry-around devices?

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There are contexts in which there can be historical facts here.

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Here, there's no dispute of historical fact.

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I mean, the facts about where we were and where we were in.

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Is it a fact question whether the smartphones and tablets were a potential market for Oracle?

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The answer is no.

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Let me put it this way.

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You might think that it is a fact question that has only one reasonable answer.

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I'm asking a threshold question.

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Is it a fact question?

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The question whether it was a potential market.

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The answer is no.

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It is the question whether it was a potential market is something you answer based upon other historical facts like where were you, where were you intending to head.

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I mean, a very good example.

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is worldwide church.

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There was a potential market there.

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It was a market for taking this liturgy and providing commentary on it.

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It was a decision that was made by worldwide church not to go ahead and do that.

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For nine years, they didn't do it.

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But the fact that they considered it made it a potential market.

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Stewart's another great example.

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I alluded to it earlier.

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So there, it's a short story that turns into a film.

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There was no way that publishing company had the capability to actually turn it into a film.

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They were a publishing company.

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Let's come back to this case, Mr. Rosen.

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Yes, sir.

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I'm a little slow, so I need your help in understanding some of this.

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We have a jury verdict to deal with.

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And I'm sure that we'll hear from Google that the jury verdict has to be upheld unless there's no substantial evidence in the record to support it.

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I would assume that that's the standard litany that we will get.

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I'm a little confused now by your discussion between facts and law and what the ultimate conclusion is.

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Let's look at the jury instructions.

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Let's look at what the jury was told in this case.

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I'm talking now, of course, about the trial on fair use, not the earlier trial.

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This is what the trial court told the jury.

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It is your duty to determine the facts from all the evidence in the case.

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To those facts, you will apply the law as I give it to you.

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That's on page 2 of his instructions.

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And on page 20 of his instructions, he said, I'm sorry, on page 19, he said, it is up to you, talking to the jury again, it is up to you to decide whether all relevant factors, when considered fully and together,

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favor or disfavor fair use.

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In other words, he put the whole issue of fair use in their hands.

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According to the record, both Oracle and Google participated in the development of these instructions.

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And in fact, I gather there was quite a bit of going back and forth until finally the charging conference when you all agreed.

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Did you agree to those instructions?

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Well, Your Honor, there was a lot of back and forth on the instructions, as you said.

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I followed all of that.

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My question is, did you agree to those instructions?

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And if you didn't, where in the record is your objection?

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Your Honor, we agreed to give the whole case to the jury.

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That was the Ninth Circuit pattern instructions.

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But all that means is that there is a black box verdict to which this court applies its role, to use a quote from Reeves,

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the guardian of the law and determine the consequence of a black box verdict is that this Court takes all of the facts that are undisputed, layers on top of them any material dispute of historical fact.

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That is the universe of facts to which this Court applies the law.

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That is the Ninth Circuit law when there's a summary judgment.

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That's the Ninth Circuit law when there is a jury verdict.

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Even when you've told the jury

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that it is determining fair use.

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Well, he then gave the jury, he said, I will give you a special verdict form to guide your deliberations.

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That form is one question.

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Yes.

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Who wins?

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Yes.

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Now, there are four factors that we ordinarily will want to look at.

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What was the jury's fact findings on each of those four factors?

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Well, Your Honor, we have to assume... Don't tell me what we have to assume.

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Tell me what the jury found on each of those four factors.

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We have no idea.

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No idea, do we?

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Yeah.

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It is a black box, just like this court reviews.

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I know obviousness is very different.

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So we can fantasize about what the jury did as well as you can.

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Is that clear?

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Yes, of course.

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And as to any historical fact, this court can assume the jury decided against us.

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So let me give you an example.

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No, I do think your obviousness analogy is actually a good one.

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Because as we said in kinetic concepts, you take the jury verdict.

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You have to assume that every fact that's relevant, every underlying historical fact, was found in favor of Google.

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And then determine whether there's sufficient evidence to support those facts.

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And then finally, on those facts, is fair use able to be determined based on those facts?

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And so what I am trying to understand is you say transformativeness and whether something's transformative is a question of law, not a question of fact.

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Now what is your, yes, we see that discussed a lot of times that way, but it does seem to have a lot of factual components to it.

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So what's your authority for the proposition that it's always a question of law?

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Well, the authority for the proposition that's always a question of law is, so first there's Harper that fair use is a mixed question of law, in fact.

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Fisher versus Dee said statutory factors are legal in nature.

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Mattel versus Walking Mountain says transformative use, there was a parody, quote, is a question of law.

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But let me explain how this works in the context of transformative use.

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So last time we were here, this court concluded that there was a disputed fact on whether Google's use of the declaring code serves a different function from the function it serves in Java.

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That was a critical piece of the transformative use inquiry.

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Now Google concedes, and the district court found,

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that the declaring code serves the same purpose in both.

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That fact alone.

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Communicating to app writers what words they should use with what punctuation to get the computer to perform certain functions.

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I would put it a different way.

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The purpose of the overall SSO is to communicate to app writers how you use this platform in order to create an app.

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Now, that fact alone, the fact that the expression means the same thing in both, there is no other disputed fact that can override the fact that the expression means the same thing in both.

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But there is an additional undisputed fact.

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Google concedes that it used Oracle's work to attract Java programmers to Android so that they would not have to, quote, learn something completely new.

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You put those two together, you can ask

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Google, what additional historical fact is relevant to transformative use?

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Don't they assert as part of this element, probably others too, but at least this element, that they transformed it into a wireless program?

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Your Honor, they make a, that is their argument, that they transformed it from PCs and laptops

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into a platform that was suitable to... And I take it your argument about that is that that's true but irrelevant.

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Our argument is that's false but irrelevant.

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False as a matter of law but also irrelevant.

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I'll explain why it's irrelevant.

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The focus has to be... False because of Target?

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False because we were in tablets, Amazon.

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False because we were in smartphones.

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As a matter of undisputed fact we were in

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Danger danger sidekick.

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Yes, danger sidekick was a smartphone Their chief of Android admitted that it was a smart phone We were in early versions of smartphones, but to get to the legal question also the case that they were into desktops or other kinds of equipment as well

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At the time Android wasn't, Android now is, but we were.

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And so basically the transformative use argument is, look at this transformation.

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We took something that was suitable for portable mobile laptops, so one type of small mobile computer, and moved it over to tablets, a different type of mobile computer.

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That's not a transformation of the sort

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that courts recognize.

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And that is one of the factors that the trial court cited to.

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But the trial court also cited to the fact that they combined it with a whole different package of programming code that effectively changed the nature of the work.

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What's your response to that?

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Well, Your Honor, yes.

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They combined it with an operating system that they got from someone else.

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That's not transformative.

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Ours was always combined with someone's operating system.

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And the fact, I mean, this court said it last time around, the fact that you add more material to that which you've copied, if what you copied is not transformative, adding more material doesn't make it transformative.

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If you take, let's take Stuart.

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Stuart's a great example.

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20% of the movie was from the book.

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The other 80% was added on top of that.

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That didn't make it transformative.

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You have to look at, and Ninth Circuit law is clear on this, Dr. Seuss says it very clearly, you have to look at that which is taken and ask, does it express something different?

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That code means the same thing.

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It was conceded by Google.

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It means the same thing in Java as in Android.

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Oh, I see my time is up, but I did want to talk about the new trial.

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Yes, we'll give you one minute to do that, and then I'll give you your five minute rebuttal back.

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So talk about the new trial.

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OK, so if this court does not resolve this case as a matter of law, there has to at least be a new trial.

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And to understand both new trial arguments, you have to understand one key fact.

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The same exact copyrighted work that is our APIs is in the same versions of Android, say Android Marshmallow, which is in multiple devices.

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smartphones, tablets, cars, now PCs and laptops.

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When Section 107 says you have to consider the effect of the use, you have to consider the entire effect, not some of it.

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The district court's decision to silo different sorts of harm into different cases was based upon a fundamentally miss, a fundamental misunderstanding of law.

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It misunderstood

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What infringed, the act of infringement, was the copying of our APIs into the Google platform, into Marshmallow, for example.

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The fact that various manufacturers then took that and put it into different devices, that just means it's different markets.

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But was there clear evidence that the Android system that was being used in those other devices actually did use these same

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Same packages?

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Yes, Your Honor.

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There's no dispute.

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That's the difference between the declaratory part and the implementing part?

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I would say no, Your Honor.

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It's our 37 packages were indisputedly and conceded by Google to be in every version of Android that is accused all the way up through Marshmallow.

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Our APIs were in there.

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if that's what your honor's question was.

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There's no dispute about that.

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In fact, after the district court accepted our complaint challenging all of the additional, that is the supplemental complaint, challenging all of the additional versions of Android up through Lollipop, Google then stipulated that Marshmallow also had those same APIs.

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Did you ask that those other devices be included

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for purposes of seeking damages with respect to that infringement, or simply that you be permitted to introduce evidence with respect to those other devices so that you could argue that that evidence is relevant to factors one and four?

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Both, Your Honor, but certainly the latter.

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By the time the district court was saying those devices are out of the case, we were saying, wait a minute.

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You can't atomize market harm.

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You can't say, well, for this case on Marshmallow,

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We will consider these markets and not look at other markets where we clearly were overlapping.

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I mean, we were in autos.

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We were in TV to the tune of 125 million TVs.

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And there is no way Google could have made the argument to the jury that it made to the jury no big deal.

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We're in this market.

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Oracle is in that market.

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Never the twain shall meet, when in fact there were markets that were overlapping in both

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the purpose and the effect would have been viewed by the jury as fundamentally different.

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Let me pursue this a little bit further with you.

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What was the point of your supplemental complaint?

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Your Honor, the point was, like any supplemental complaint, was to update the case after two and a half years of being away.

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And the district court accepted the complaint.

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We conducted, and without any objection by Google, we conducted six months of discovery on those, Marcus.

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In that complaint, you mentioned TV, you mentioned auto.

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Wearables, auto, yes.

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Were those issues not in the case before that?

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Were they not brought up in the infringement

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part of the litigation?

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Well, Your Honor, I think that the most important thing to understand legally about this issue is that we accused the platforms of infringement, not particular devices.

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Those other devices didn't exist the first time around.

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So the first time around, Android was new, and it was only in smartphones and tablets.

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But we updated the case.

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That update was accepted.

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We did discovery about it.

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There were expert reports about it.

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And then 10 days before trial, the district court announced, I am lopping off these markets and this evidence, even to the extent it bears on purpose.

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And again,

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And if you listen to Google's argument about their purpose, they say their purpose was about adapting to smartphones, and our purpose was about PCs.

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I'm puzzled because I would have thought that this last discussion we're having would have been your main point of argument, that you didn't get a fair trial because all of this material never got to the jury in a useful way.

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But that's not your point, I take it.

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It had to be your point when you brought in that supplemental complaint.

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This was devastating.

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This is our main new trial argument.

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We have a Jamal argument that says we don't even need a new trial, because as a matter of law, Google did not demonstrate fair use on any particular factor, much less this Court's job is clearly to analyze the factors

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unmask and figure out how they weigh against each other.

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I think we've gone way over so I'll give you some more time to force you to use more time too when we get to that point.

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Thank you.

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I'll give you five minutes back.

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Good afternoon and may it please the court.

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This court was right the first time when it denied Jamal found there were disputed questions of fact in all four factors and remanded for a new jury trial in fair use.

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The jury then heard evidence from 29 witnesses across nine days and heard conflicting testimony.

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You talked about the transformative piece.

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Of course.

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I mean, we know we have a jury trial and a law trial.

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God, it would be awful to do this again and all the usual stuff, right?

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But let's talk about the specifics.

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Transformative, one question.

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How does your theory of transformative preserve, in a robust way, the exclusive right to derivative works?

[00:22:32] Speaker 04:
Well, sure.

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First, as you know, the exclusive rights of derivative works is, by statute, subject to the fair use defense.

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So it's one of many rights.

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It's not that likely that these would be contradictory, right?

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So you want to give them some robust meaning.

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And derivative work has the word transform in part of the definition, doesn't it?

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The statutory definition of derivative, yes, for some other, which is directed at the underlying right, does have transform in it.

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So it gets confusing.

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in that respect.

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So the fact that you took a set of packages, the copyrighted material that's now at issue here, and made it into a robust smartphone and tablet platform or programming environment for app writers, assume that, which I think, assume that you did that, why was that

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How can you say that that's transformative without eliminating, effectively eliminating their right to make a derivative work for smartphones and tablets?

[00:23:40] Speaker 04:
Well, they have a right to make derivative works for certain.

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Whether this is, but many works that you could, there are many works where I could take part of an existing work, add some new things, call it a derivative work.

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I mean, how can that be true here?

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Being transformative.

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How can that be so here?

[00:23:57] Speaker 04:
Well, because what Google did here on the fax is so incredibly transformative.

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I mean, it took a little bit of J2SE, less than one half of 1%.

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It added 100 new packages.

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The parts that you thought was key to the new devices.

[00:24:09] Speaker 02:
I think key is that your witnesses were right.

[00:24:11] Speaker 02:
Well, actually, your briefs were.

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Those were the ones that Google understood that programmers would want to be able to use in the context of mobile device, the ones with overlap.

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But again, just for purposes of

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programmers using their established familiarity with the Java programming language so that they could use those method headers, the shorthand commands.

[00:24:33] Speaker 02:
Did you have evidence that all of the stuff that you took and put into Android was necessary for programmers to use the Java language?

[00:24:42] Speaker 02:
I thought there was at least a stipulation about some very small portion.

[00:24:47] Speaker 02:
Was there further evidence that you put on a trial that quite a lot of or even all of the 37 packages and their structure

[00:24:55] Speaker 02:
was essentially necessary for programmers to use the Java language?

[00:25:01] Speaker 04:
Right.

[00:25:01] Speaker 04:
Well, the distinction is between technically and practically necessary.

[00:25:04] Speaker 04:
The stipulation said that at least some of them were technically necessary, and Oracle agreed that those were necessary.

[00:25:10] Speaker 04:
Oracle agreed those were fair uses as a matter of law.

[00:25:13] Speaker 04:
With respect to others, there was evidence that, the evidence, Google's argument has always been that they're practically necessary.

[00:25:20] Speaker 01:
Right, but you agreed that they're not technically necessary.

[00:25:24] Speaker 04:
Not technically, in the sense that you could do some things with Java.

[00:25:28] Speaker 04:
But again, the idea would be then what are you going to do?

[00:25:30] Speaker 04:
Instead of using a shorthand command to pull up the code to implement a function, the programmer's not going to type up his own implementations of all of these functions.

[00:25:38] Speaker 04:
And Google could, instead, have come up with totally different declarations.

[00:25:42] Speaker 04:
But then none of those shorthand commands would have worked.

[00:25:44] Speaker 04:
And so then, it's what the discard talked about, is it's just scrambling all of these systems.

[00:25:50] Speaker 01:
So all right, we went through that part the last time.

[00:25:52] Speaker 01:
Let me focus on that.

[00:25:54] Speaker 01:
the issues that I think that where Judge Toronto was trying to direct you, which is, what is it that you used these for purposes of creating a programming language, correct?

[00:26:11] Speaker 04:
We use these as part of the new operating system.

[00:26:14] Speaker 01:
As part of creating the new operating system, creating the programming language for the new operating system.

[00:26:19] Speaker 04:
I mean, the programming language is Java,

[00:26:22] Speaker 04:
I'm sorry, I was going to say the programming language is Java.

[00:26:25] Speaker 04:
I don't mean to quote what was created.

[00:26:28] Speaker 01:
How do you get around the Ninth Circuit law that says merely using something and putting it into essentially a different context does not equate to transformativeness?

[00:26:43] Speaker 04:
The Ninth Circuit cases stand for the proposition that if I have, it's not a different context, if I just have a different medium, if I

[00:26:50] Speaker 04:
At J2SC, stored on one type of storage medium, I move it to another type of storage medium, that's not going to be a fair use.

[00:26:56] Speaker 02:
Right, but if you take a short story and make a movie out of that, that's got to be a different context.

[00:27:01] Speaker 02:
And that's classically something that you can't do and just say, oh, the guy in the Brooklyn apartment who wrote the story, whoever it was, he doesn't have a movie studio and lights and all that stuff.

[00:27:14] Speaker 02:
He can't do that.

[00:27:16] Speaker 04:
Well, let's assume that on the facts, that would be a different new context, right?

[00:27:19] Speaker 04:
It's still the factual question of what's a different context.

[00:27:22] Speaker 04:
And here on the computer side, it can be different.

[00:27:23] Speaker 04:
The jury heard a lot of evidence that the operating system for smartphones was an entirely different context from an operating system for computers, for personal computers.

[00:27:32] Speaker 03:
So for example... What was key then to your transformation position, wasn't it, that you all were engaged in smartphones

[00:27:40] Speaker 03:
they were engaged in computers, wasn't that?

[00:27:43] Speaker 04:
That was absolutely the transformative purpose.

[00:27:45] Speaker 03:
That was your whole key to the transformation issue.

[00:27:50] Speaker 01:
But aren't you supposed to be transforming the work, not just the... Well, this was going to be one of my key points.

[00:27:59] Speaker 04:
When the question is, they talk about the line of computer code having the same purpose in two programs, that's not the right level of which to look at it.

[00:28:06] Speaker 04:
Because the question is whether you transformed one original work

[00:28:10] Speaker 04:
into another work.

[00:28:12] Speaker 04:
And so that is Campbell talks about transformation of the works, Seltzer of the original work.

[00:28:19] Speaker 04:
And that's the transformation here.

[00:28:20] Speaker 04:
You start off with JTSE.

[00:28:25] Speaker 04:
You take less than one half of 1% of it, which is declarations which are predominantly functional.

[00:28:30] Speaker 04:
You then add all of these new declarations for the mobile environment.

[00:28:33] Speaker 04:
You then add all of this new implementing code for this new environment.

[00:28:37] Speaker 04:
and come up with what the witnesses consistently testified, including Java's witnesses, was an incredible new creation.

[00:28:44] Speaker 03:
Even assuming, for argument's sake, that that's transformative, the difference between using your APIs for smartphones versus using them in a computer setting,

[00:29:04] Speaker 03:
Is it the case that after that supplemental complaint was filed, that distinction disappeared in the case?

[00:29:14] Speaker 03:
Is that not true?

[00:29:16] Speaker 03:
No.

[00:29:16] Speaker 03:
You all didn't object to the filing of the supplemental complaint, did you?

[00:29:22] Speaker 04:
Not the filing of the complaint, no.

[00:29:23] Speaker 03:
And everyone I take it agreed to the instructions to the jury at that time.

[00:29:32] Speaker 03:
But by that time, the distinction between smartphones and computers had disappeared from the factual basis of the case.

[00:29:47] Speaker 04:
Just to be clear on what we're talking about, you mean things like Android Auto, Brillo for the internet of things, refrigerators, that type of thing?

[00:29:53] Speaker 03:
By that time, Oracle had established that these were the things it was doing, and it was overlapping with the things that you were doing.

[00:30:02] Speaker 04:
Well, there are two things, important things.

[00:30:05] Speaker 04:
First, it is important that this court had already was remanding for a new trial.

[00:30:10] Speaker 04:
And when district court has remand for a new trial, under Ninth Circuit precedent, there's very broad discretion to determine whether to expand the issues, arguments, evidence in the case.

[00:30:19] Speaker 04:
The district court here, on page 55, 58, was worried about juror confusion from blowing the scope wide open relative to what it already had.

[00:30:27] Speaker 04:
But even apart from that,

[00:30:30] Speaker 04:
It's not the case, because the uses have to be assessed.

[00:30:32] Speaker 04:
You have to look at this in a work-by-work basis on a use-by-use basis.

[00:30:35] Speaker 04:
And there are two key failures of proof here.

[00:30:38] Speaker 04:
One is the notion that came up before, that there's just one Android operating system.

[00:30:43] Speaker 04:
Anything that's got the name Android in it, it's got that in it.

[00:30:46] Speaker 04:
One is false.

[00:30:47] Speaker 04:
But two, there's also no evidence of it.

[00:30:49] Speaker 04:
Oracle assured the court it could do that quickly.

[00:30:52] Speaker 04:
They never even put in an offer of proof.

[00:30:54] Speaker 04:
So there's no evidence that any product with Android in the name has that same Android operating system in it.

[00:31:00] Speaker 04:
And going a little bit out of the rocket here, it's not the case.

[00:31:03] Speaker 02:
Can I take you back to the Jamal piece and focus in particular on this?

[00:31:11] Speaker 02:
You don't dispute that for a few years or over the course of a few years, Oracle was voluntarily and in good faith negotiating with Google.

[00:31:24] Speaker 02:
Didn't work out, but that was happening.

[00:31:27] Speaker 04:
There were negotiations with Sun over a much broader development partnership, I mean over a lot else.

[00:31:32] Speaker 02:
But specifically, I thought it was specifically referenced in testimony by Andy Rubin and emails and whatnot.

[00:31:41] Speaker 02:
So why does that fact alone not suffice to establish as a matter of law that this market that they were interested in was a potential market for

[00:31:56] Speaker 02:
for Sun Oracle.

[00:31:58] Speaker 04:
Well, Campbell squarely rejected the argument that failed licensing negotiations.

[00:32:01] Speaker 02:
No, not failed.

[00:32:02] Speaker 02:
Not failed.

[00:32:04] Speaker 02:
That was rejecting the argument that failed licensing on the part of the defendant tells you something about they kind of knew they had to do it, and they went ahead and did it.

[00:32:13] Speaker 02:
I'm talking about the question of whether these wireless devices, the tablets and the smartphones, were a potential market for Oracle, for Sun Oracle,

[00:32:27] Speaker 02:
They negotiated for four years or something before the whole thing ended.

[00:32:34] Speaker 02:
Doesn't that establish that they were interested in that market?

[00:32:38] Speaker 02:
Not perhaps not to do it themselves.

[00:32:44] Speaker 02:
But the guy in Brooklyn with the story isn't going to make the movie either.

[00:32:47] Speaker 02:
The potential market is a market for him to license somebody else to do.

[00:32:53] Speaker 04:
What's wrong with that?

[00:32:55] Speaker 04:
I mean, Oracle was interested in engaging in licensing negotiations with Google when Drake in very reasonably determined just means that Oracle was interested in trying to make money if Google would give it to it.

[00:33:08] Speaker 04:
But what you then have, though, is for.

[00:33:10] Speaker 02:
I'm sorry.

[00:33:10] Speaker 02:
I don't think I even quite heard.

[00:33:12] Speaker 04:
Well, the fact that Oracle engaged in licensing discussions with Google, I mean, of course it did.

[00:33:16] Speaker 02:
Doesn't it show that it was interested in the market that was the subject of the negotiations?

[00:33:24] Speaker 04:
We know it was interested in making money from a Google partnership.

[00:33:27] Speaker 02:
For wireless devices.

[00:33:30] Speaker 04:
Yes, but all of the evidence here shows that it wasn't just that Sun was not able to do this itself.

[00:33:35] Speaker 04:
It's that Java 2SE, or Java generally, was not situated to be moved into the mobile environment.

[00:33:41] Speaker 04:
And the jury heard a lot of evidence that could have agreed on that.

[00:33:43] Speaker 04:
Sun's internal documents said it had, quote, no solution for smartphones.

[00:33:47] Speaker 04:
It's appendix page 555-40.

[00:33:48] Speaker 01:
Well, obviously, portions of it were suitable for moving into the mobile environment, or you wouldn't have taken it.

[00:33:55] Speaker 04:
But what was taken was less than one-tenth of 1% of Android.

[00:33:58] Speaker 04:
So it's a tiny portion of what was taken was less than one-half of 1%.

[00:34:01] Speaker 01:
Well, that's plenty of case law that says that that's irrelevant.

[00:34:04] Speaker 04:
Well, it's not irrelevant to transformation, because in transformation, you're looking at what the defendant added.

[00:34:09] Speaker 04:
The defendant adds something new, add value, such that you have a new creation and a new context.

[00:34:13] Speaker 04:
So you have to look to what was added for that purpose.

[00:34:16] Speaker 04:
Maybe not for others, but for that purpose.

[00:34:18] Speaker 04:
And what you have there is Google added all of this new and fluctuating between market harm and transformation because there's some relationship.

[00:34:28] Speaker 04:
But remember, Oracle's own witness testified the move to smartphones was the greatest technological evolution he'd ever seen.

[00:34:34] Speaker 04:
Smartphones were unprecedented.

[00:34:36] Speaker 04:
Oracle's former Eric Schmidt testified he'd never seen anything like Android.

[00:34:40] Speaker 04:
It was completely different from any other approach.

[00:34:42] Speaker 04:
Oracle's bar testified that Android embodied a major shift in the market that transformed the status quo in significant ways.

[00:34:49] Speaker 04:
And the reason was that, as Dr. Astrakhan testified, tiny phones with vastly different functionality differ a lot from big PCs with, again, very different functionality.

[00:34:58] Speaker 02:
Tell me why there isn't an obvious counterpart to that when the movies were invented, or talkies were invented, or Technicolor, or streaming

[00:35:12] Speaker 02:
You know, so that they can get the guy with the story, right?

[00:35:16] Speaker 02:
If it's, wow, you can put this on the screen and people can see it.

[00:35:20] Speaker 02:
They don't have to imagine it when reading the words.

[00:35:22] Speaker 04:
Right.

[00:35:22] Speaker 04:
But if it's just another way of delivering the same content, here's a movie, here's a movie.

[00:35:26] Speaker 02:
Well, very reasonable to conclude.

[00:35:28] Speaker 02:
Except in Stuart.

[00:35:29] Speaker 02:
I mean, I take it.

[00:35:31] Speaker 02:
Mr. Rosencrantz said that, was that Rear Window?

[00:35:34] Speaker 02:
Is that the movie?

[00:35:37] Speaker 02:
Stuart Against Avond?

[00:35:39] Speaker 02:
Yeah.

[00:35:39] Speaker 02:
So that, what, 80% of the material was new.

[00:35:42] Speaker 02:
and not just the actors and the Hitchcock.

[00:35:48] Speaker 04:
It's a factual question.

[00:35:49] Speaker 04:
Take L.A.

[00:35:49] Speaker 04:
News.

[00:35:50] Speaker 04:
You had a film clip involving the Rodney King meeting, very well known.

[00:35:54] Speaker 04:
Ninth Circuit Hall, it was very used to take a very well-recognizable and popular, well-recognized known clip of that.

[00:36:00] Speaker 02:
I thought that it was very used to use it for one purpose, not for two of the other purposes.

[00:36:05] Speaker 02:
Ninth Circuit had that three times, I started to think.

[00:36:10] Speaker 04:
I know.

[00:36:10] Speaker 04:
But all of this purpose is involved showing that video on television, is my point.

[00:36:15] Speaker 04:
So it's not just enough to say that, OK, it's a video.

[00:36:17] Speaker 04:
You're showing a video.

[00:36:19] Speaker 04:
It's on television.

[00:36:20] Speaker 04:
You've got two different contexts.

[00:36:21] Speaker 04:
In the same case, that's two different contexts, depending on what you're doing.

[00:36:24] Speaker 01:
Right.

[00:36:24] Speaker 01:
But the fact that it was on television was not relevant.

[00:36:27] Speaker 01:
In other words, the fact that it was shown on television or shown in a movie theater, that wasn't relevant to why the Ninth Circuit felt that there was a transformation of the material.

[00:36:37] Speaker 02:
That's what they were doing with it and here what Google was doing with it was again was providing app writers a efficient way for them to write programs to do to perform functions and that's what the Java version did.

[00:36:53] Speaker 04:
Except the same purpose.

[00:36:55] Speaker 04:
So for transformation we are supposed to be looking to

[00:36:58] Speaker 04:
the transformation of the original work as a whole to the new work as a whole, not just narrowly at whether the defined portion of it will do the same thing.

[00:37:05] Speaker 01:
Do you agree that transformation is a question of law?

[00:37:08] Speaker 04:
Not in this case.

[00:37:09] Speaker 04:
I mean, the summary judgment case is everything is a question of law.

[00:37:13] Speaker 04:
But here, I mean, transformation, I mean, whether you're going to take

[00:37:18] Speaker 04:
whether you have added to it such that you have a new creation and a new context is an inherently fact-specific question.

[00:37:24] Speaker 04:
Not always, but here.

[00:37:27] Speaker 01:
I think there's a lot of case law that says the statutory factors are questions of law.

[00:37:34] Speaker 01:
So when you were here last time, and you argued that if we found a copyrightable, it had to get remanded when Google was here, it had to be remanded because there were

[00:37:45] Speaker 01:
disputed historical facts.

[00:37:47] Speaker 01:
And so what I'm trying to determine is, what do you think the historical facts are?

[00:37:52] Speaker 01:
It's not helpful for either side to just say, well, whether it was transformative or not, because it's the facts that underlie that conclusion that are the important ones.

[00:38:01] Speaker 01:
So what are the facts?

[00:38:03] Speaker 04:
Number one is, we're smartphones, a new context.

[00:38:09] Speaker 04:
uh... which turns in part on some of the evidence i was discussing about how it starts with some credible technological evolution there's also on on all sun's documents saying that it's right i mean it wasn't for lack of ability it was uh... sun's witnesses brenda for example said he tried and failed to build a mobile platform using these a p i s ellison testified oracle never had a product if you think that the story writer in the brooklyn apartment

[00:38:36] Speaker 02:
tries his hand at writing a screenplay and tries it several times.

[00:38:41] Speaker 02:
And everybody in the movie business who knows anything about it looks at the screenplay and says, you are in the wrong medium.

[00:38:48] Speaker 02:
Great story.

[00:38:48] Speaker 02:
You don't know how to do dialogue.

[00:38:50] Speaker 02:
You don't know how to do pacing.

[00:38:52] Speaker 02:
Does he lose his right to prevent somebody else from Robert Town or somebody from writing a screenplay about it?

[00:38:59] Speaker 04:
Not if it's a traditional, reasonable, or likely to be developed market for the original work.

[00:39:03] Speaker 04:
But two things, which is important because that's the Seltzer standard.

[00:39:06] Speaker 04:
It's not just anything you might do with it.

[00:39:08] Speaker 04:
That gets too broad.

[00:39:09] Speaker 04:
I mean, if someone does something incredibly transformative, you know, to be given credit for the fair use, you can't say, well, it's in a market that it's, you know, in a market that's a little far removed.

[00:39:18] Speaker 04:
But again, here on the facts, first, since the software company.

[00:39:20] Speaker 01:
So if we took the Beatles song and live streamed it on the computer, that would be transformative?

[00:39:27] Speaker 04:
No, it's the exact same content just in a different medium, like taking Java 2SC and copying it to a different storage device.

[00:39:32] Speaker 04:
Of course not.

[00:39:33] Speaker 04:
But here, one, it's this incredibly new environment.

[00:39:37] Speaker 04:
And two, all of Sun's witnesses recognized that it wouldn't work.

[00:39:42] Speaker 04:
Stahl testified in his video deposition that you have to modernize the API significantly in order to make them work for smartphones.

[00:39:49] Speaker 04:
And so the point is, one, in terms of your question before that, I mean, one, Sun's a software company.

[00:39:53] Speaker 04:
It knows how to do software.

[00:39:55] Speaker 04:
And two, the jury can at least infer as a fact that the problem wasn't Sun's lack of ability with software.

[00:40:00] Speaker 04:
But instead, it was this incredible transformation

[00:40:03] Speaker 04:
that wasn't, that therefore qualified as a fair use.

[00:40:06] Speaker 04:
Otherwise, you'd end up with nothing's a fair use, because someone could always take the product and do something else with it.

[00:40:11] Speaker 03:
When did Google start using Android in desktops and laptops, as well as using it in smartphones?

[00:40:22] Speaker 04:
Sure.

[00:40:22] Speaker 04:
So the ARC program is what's discussed here.

[00:40:26] Speaker 04:
It's the application runtime for Chrome, where you have the Chrome operating system, and then there's this add-on that allows them to

[00:40:32] Speaker 04:
run some.

[00:40:33] Speaker 04:
ARC went back to, sorry I'm not sure exactly, the important thing about ARC though is that it was, it's been presented as a discovery misconduct issue.

[00:40:42] Speaker 04:
Google disclosed ARC throughout fact discovery.

[00:40:45] Speaker 04:
It was discussed in depositions.

[00:40:47] Speaker 04:
But this is ARC++.

[00:40:48] Speaker 04:
Right, which is just the latest iteration.

[00:40:50] Speaker 04:
So ARC throughout discovery, it's in expert reports, it's in depositions, they knew all about it.

[00:40:56] Speaker 04:
This is the district court's point.

[00:40:57] Speaker 04:
ARC++ is just the latest iteration to try to do that better.

[00:41:00] Speaker 04:
so that all apps could run on it.

[00:41:03] Speaker 04:
That started in September of 2015.

[00:41:04] Speaker 04:
The discovery responses in question were in December of 2015, and they included documents concerning the latest update of our plus plus.

[00:41:13] Speaker 04:
Well, the trial was still on.

[00:41:15] Speaker 04:
Well, here's, so this was six months before trial in December, the documents about the technical details and goals.

[00:41:21] Speaker 04:
It wasn't finished, though.

[00:41:23] Speaker 04:
The code wasn't finished until a month after the trial in June of 2016, which then is when

[00:41:30] Speaker 04:
It was first rolled out to developers a month after the trial.

[00:41:33] Speaker 04:
It was working on it.

[00:41:34] Speaker 03:
May of 2016, Google announced that this is where it was done.

[00:41:39] Speaker 04:
It was going to be that R++, the new version, was going to be coming out.

[00:41:42] Speaker 04:
It would be releasing it through developer channels.

[00:41:44] Speaker 04:
A month later, it actually finished the code and did that.

[00:41:47] Speaker 04:
All these facts are in the declaration of one of Google's attorneys that the district court relied on.

[00:41:54] Speaker 04:
That's why the district court, after looking into this incredibly carefully, taking affidavits and all,

[00:41:58] Speaker 04:
So he thought Google had fostered a major, you know, was fostering a misimpression with a totally unfair argument, which is correct.

[00:42:03] Speaker 04:
Oracle.

[00:42:05] Speaker 01:
You mean Oracle.

[00:42:06] Speaker 01:
Oracle.

[00:42:08] Speaker 04:
Oracle.

[00:42:08] Speaker 04:
I'm sorry.

[00:42:08] Speaker 04:
I misspoke, obviously.

[00:42:10] Speaker 01:
Sorry.

[00:42:11] Speaker 01:
You're going to have to wrap up.

[00:42:12] Speaker 01:
We did give you a lot of extra time.

[00:42:14] Speaker 01:
OK.

[00:42:16] Speaker 01:
It's easy to control the lawyers.

[00:42:17] Speaker 02:
It's not so easy to control these guys.

[00:42:21] Speaker 02:
Am I right that in this case, at least at this stage, we don't have

[00:42:26] Speaker 02:
the particular kind of interoperability concern that looms so large 25 years ago or something in Lotus Against Borland, namely, there's an installed base on end users' computers of files written in a language that, the Lotus 123 there, that in order that the new software really would

[00:42:55] Speaker 02:
it would be important for any new competitive software to be able to run those programs or end users are going to stick with 123.

[00:43:03] Speaker 02:
That was the theory, obviously.

[00:43:06] Speaker 04:
The compatibility issue here is different.

[00:43:08] Speaker 04:
It's compatibility for programmers.

[00:43:10] Speaker 04:
If programmers, Java said go use, Java encouraged everyone to use the language.

[00:43:17] Speaker 04:
It also repeatedly said that the declarations are free for anyone to use without a license.

[00:43:21] Speaker 04:
There's tremendous testimony about that in the record, which is also important.

[00:43:24] Speaker 04:
But the point is that once developers did that, once they developed their fluency with Java, then they should be able to sit down and use the language and the familiar shorthand commands in programming in this new context.

[00:43:36] Speaker 04:
And that's what Google was looking to allow them to do for the packages that did have overlap that would also be relevant to this new context.

[00:43:43] Speaker 04:
Because remember, the smartphones have tremendous amounts of functionality you don't get in a PC, phone, camera.

[00:43:49] Speaker 04:
flashlight, GPS, all those things.

[00:43:51] Speaker 04:
Similarly, PCs have all sorts of issues that the mobiles don't.

[00:43:55] Speaker 04:
So you have different packages.

[00:43:56] Speaker 04:
But for that overlap, the point is just that in order to encourage, first, consistent with Sun's repeated business model, which was to make the declarations free and then compete on implementations and services.

[00:44:07] Speaker 04:
But then, two, in terms of promoting the progress of the sciences and the useful arts, the idea is people should be able to use the required fluency to create new

[00:44:17] Speaker 04:
original works in this brand new environment.

[00:44:23] Speaker 01:
OK.

[00:44:24] Speaker 01:
I think you're done.

[00:44:26] Speaker 04:
Thank you.

[00:44:30] Speaker 00:
Your Honor, Judge Amali asked, I think, a really important question, asking for the help of the lawyers on identifying the facts that control the outcomes.

[00:44:41] Speaker 00:
So if you give me one minute, I can tell you

[00:44:45] Speaker 00:
the undisputed facts on the basis of which each factor has to be decided, regardless of any additional historical fact that Google might point out.

[00:44:57] Speaker 00:
Factor one, Google made $42 billion on Android that makes it commercial.

[00:45:03] Speaker 00:
The declaring code has the same purpose in both platforms that makes it non-transformative.

[00:45:10] Speaker 00:
Java ran tablets, that's Amazon.

[00:45:14] Speaker 00:
smartphones in danger, and a full stack mobile platform, that's Savage, before Android.

[00:45:22] Speaker 00:
So Google's view of transformation is wrong as a matter of law anyway.

[00:45:28] Speaker 00:
Oracle intended to license in smartphones.

[00:45:31] Speaker 00:
That means it's a potential market, and it is a natural, reasonable market for us to look at.

[00:45:37] Speaker 00:
Factor two.

[00:45:39] Speaker 00:
There is a vast number of ways to write and organize the APIs.

[00:45:42] Speaker 00:
That makes it creative.

[00:45:44] Speaker 00:
Only 170 lines of code were necessary to write Android in the Java language.

[00:45:51] Speaker 00:
That makes everything else technically.

[00:45:55] Speaker 00:
Technically.

[00:45:56] Speaker 00:
But this court already addressed the relevance of the non-technically piece to creativity, still on factor to

[00:46:07] Speaker 00:
Google did not need to copy the APIs in order to write the platform in the Java language, to your point about technically versus.

[00:46:15] Speaker 01:
I mean, the fact that it was creative doesn't mean that it doesn't also have some functional aspects.

[00:46:20] Speaker 00:
Absolutely.

[00:46:21] Speaker 00:
And the law in the Ninth Circuit and from the Supreme Court is clear.

[00:46:25] Speaker 00:
The question is whether it's creative.

[00:46:27] Speaker 00:
If it also serves a function, that does not withdraw the creativity.

[00:46:31] Speaker 00:
I mean, that is Stein, Mazer.

[00:46:34] Speaker 00:
Factor three.

[00:46:36] Speaker 00:
Google copied 100% of the SSO from those 37 packages.

[00:46:41] Speaker 00:
Google copied, quote, to leverage the existing.

[00:46:45] Speaker 02:
I thought that the works in question here are the two registered JSE, whatever.

[00:46:51] Speaker 02:
Your Honor, the interest.

[00:46:55] Speaker 02:
If the question is in some quantitative sense, not a qualitative sense, did they copy a large or small amount of the work?

[00:47:04] Speaker 02:
copyrighted works.

[00:47:05] Speaker 02:
As alleged in the complaint, the answer is small.

[00:47:09] Speaker 00:
Quantitatively correct.

[00:47:11] Speaker 00:
Small as to the declaring code.

[00:47:14] Speaker 00:
Huge as to the SSO.

[00:47:16] Speaker 00:
It was everything in those 37 packages.

[00:47:19] Speaker 00:
And look at Harper and Row.

[00:47:21] Speaker 00:
That was 300 words out of 655 pages.

[00:47:25] Speaker 00:
Quantitative is not the end all and be all.

[00:47:28] Speaker 00:
Just to continue the litany, I'm still on factor three.

[00:47:33] Speaker 00:
The declaring code was valuable even if Google says it was not the most important.

[00:47:38] Speaker 00:
Factor four.

[00:47:40] Speaker 00:
And this is really, really important because we did not talk about either actual harm or we talked a little bit about potential harm.

[00:47:49] Speaker 00:
Five facts.

[00:47:50] Speaker 00:
Amazon cited Android as the basis for demanding a 97.5% discount.

[00:47:57] Speaker 00:
That was since the last case on the Kindle.

[00:48:00] Speaker 00:
And we went from, this is undisputed,

[00:48:03] Speaker 00:
Java in generation of Kindle 1, 2, Android in the next generation of Kindle, to this 97% discount on Java in generation 3.

[00:48:15] Speaker 00:
Third, sorry, second fact, Java SE competed directly with Android in the smartphone market.

[00:48:24] Speaker 00:
That's danger and savage.

[00:48:26] Speaker 00:
Third, Android caused Savage to lose investment.

[00:48:30] Speaker 00:
That is undisputed.

[00:48:32] Speaker 01:
Wasn't there evidence that Savage wasn't really a smartphone?

[00:48:35] Speaker 01:
Couldn't the jury have accepted that proposition?

[00:48:38] Speaker 00:
There was no evidence that Savage was not really a smartphone.

[00:48:43] Speaker 00:
Rubin, the Android chief, agreed it was a smartphone.

[00:48:49] Speaker 00:
There was evidence that it was not a very good one.

[00:48:53] Speaker 00:
But the film producer doesn't get to say

[00:49:00] Speaker 00:
I plagiarized your work because you were going to make a lousy film, or I did a better sequel than you.

[00:49:06] Speaker 00:
Fourth fact, Samsung cited Android to extract a $39 million discount.

[00:49:13] Speaker 00:
Final fact, for harm, Android made it impossible for Oracle to enter the market with a Java SE derivative.

[00:49:22] Speaker 00:
Now, let's look.

[00:49:23] Speaker 01:
Was Java SE in Savage in Danger?

[00:49:27] Speaker 00:
Yes, Your Honor.

[00:49:29] Speaker 00:
Java ME, I have not even talked about Java ME, which was in all the other mobile devices, which makes it so obvious that we were in a position to either license for or create another mobile platform.

[00:49:42] Speaker 00:
Java SE was in Savage.

[00:49:46] Speaker 00:
That is actually a transposition of Java SE.

[00:49:50] Speaker 00:
And it was no question in danger.

[00:49:53] Speaker 00:
It is in the phone danger.

[00:49:55] Speaker 00:
That was a smartphone.

[00:49:56] Speaker 00:
It was one of the most

[00:49:58] Speaker 00:
popular smartphones of its day.

[00:50:01] Speaker 00:
It was sidekick.

[00:50:02] Speaker 00:
So Mr. Joseph identifies, let's go to transformative use.

[00:50:06] Speaker 00:
Factual disputes, he calls them, on transformative use.

[00:50:10] Speaker 00:
The smartphone was a new context.

[00:50:13] Speaker 00:
That's not a factual dispute.

[00:50:14] Speaker 00:
That's a legal question on whether it's relevant.

[00:50:17] Speaker 00:
Sun failed to develop smartphones.

[00:50:19] Speaker 00:
We disagree on whether the fact has been established doesn't matter.

[00:50:22] Speaker 00:
Well, it doesn't matter.

[00:50:24] Speaker 00:
If you did not make a very good sequel, or you don't have a film company to make your movie for you, that does not mean that you don't have a potential licensing market.

[00:50:37] Speaker 00:
We were in the licensing business to the tune of $100 million with Java.

[00:50:43] Speaker 00:
And that was the market that was the potential for the smartphone.

[00:50:47] Speaker 00:
And to Judge Taranto's point, you are absolutely right.

[00:50:50] Speaker 00:
Our negotiations with Google

[00:50:52] Speaker 00:
for Google to create the next big Java SE-based platform is definitive evidence that we had a potential market for the next Java SE-based platform for smartphones.

[00:51:07] Speaker 00:
It's just that they then moved into it, occupied it, and made it impossible for us to license to anyone else, which was exactly the savage story.

[00:51:17] Speaker 01:
OK, we need to wrap up.

[00:51:18] Speaker 00:
OK, thank you, Your Honor.

[00:51:22] Speaker 00:
I'll just close with this.

[00:51:26] Speaker 00:
If copyright protection for code is going to mean anything, it must mean that a competitor cannot use copyrighted code for the identical purpose in competition with the copyright holder.

[00:51:40] Speaker 00:
Such a competitive use bears no resemblance to the sorts of fair uses that are described in the statute.

[00:51:47] Speaker 00:
It doesn't look like criticism.

[00:51:48] Speaker 00:
It doesn't look like comment.

[00:51:49] Speaker 00:
It doesn't look like research.

[00:51:51] Speaker 00:
All of those things

[00:51:52] Speaker 00:
do not substitute for you in the market.

[00:51:55] Speaker 00:
This does.

[00:51:56] Speaker 00:
Now, remember how pathbreaking Java was.

[00:51:58] Speaker 00:
And remember that without Java, there'd be no Android.

[00:52:03] Speaker 00:
No software company is ever going to invest the hundreds of billions of dollars that it takes to create the next groundbreaking platform if their competitors can stand on the sidelines.

[00:52:15] Speaker 01:
We don't need the policy arguments, OK?

[00:52:16] Speaker 00:
Thank you, Your Honor.

[00:52:17] Speaker 01:
All right, thanks.

[00:52:20] Speaker 01:
This Court is adjourned.

[00:52:23] Speaker 00:
All rise.