AT&T Corporation, an American multinational telecommunications establishment, possessed a patent that protected speech recognition software in the United States. Similarly, Microsoft, an American multinational technology company, created code to make a computer program that also recognized speech, but instead decided to sell it in foreign countries. Essentially, Microsoft found a complex loophole in Section 271(f) of the United States’ Patent Act and was eventually able to legally sell their speech recognition program in foreign countries. However, AT&T believed Microsoft to be held liable for infringement because Microsoft stole their software program and earned money off of what was originally AT&T’s idea. The Microsoft Corporation versus AT&T Corporation went through three courts and two appeals, eventually making its way to the Supreme Court. AT&T held patent number 4472832 which protected a program that could digitally recognize speech and encode it. Microsoft created a computer program called NetMeeting and proceeded to send, either electronically or by mail, the computer coding required for NetMeeting to a foreign manufacturer. The foreign manufacturer generated copies of NetMeeting and installed it onto computers, which they sold to other countries. When AT&T caught wind of Microsoft’s scheme, they filled a law suit that eventually made its way to the Supreme Court (Chicago-Kent College of Law). However, Section 271(f) of the United States Patent Act states that no “component of a patented machine, manufacture, combination or composition, or a material or apparatus” can be sold by any other cooperation other than the one holding the patent (Legal Information Institute). So Microsoft found a loophole by only sending the speech recognition program’s code, which does not qualify as a component, machine, manufacture, or any other items listed in Section 271(f). Furthermore, in 2001, AT&T filed a law suit against Microsoft Corporation because AT&T believed Microsoft to be liable for patent infringement.
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AT&T’s suit won over the district court and found Microsoft liable for infringement. However, Microsoft disliked the district court’s ruling at appealed the case to the Federal Circuit, which is the only appellate court with the authority to hear appealed patent cases, only to be charged as liable for a second time. The Federal Circuit looked at one of the few similar cases that was heard in the past, Deepsouth Packing Co. v. Laitram Corp. Laitram Corporation held a patent on a shrimp cleaning machine and Deepsouth Packing proceeded to send a similar machine abroad to be copied by foreign manufacturers. When Laitram filed a law suit against Deepsosuth, Laitram won because Deepsouth sent a machine, an item covered in Section 271(f), and Deepsouth was convicted of infringement. Again, Microsoft questioned the credibility of the two court’s rulings and appealed the case to the Supreme Court. In 2006, the Supreme Court finally agreed to hear Microsoft’s petition and granted it a writ of certiorari (Legal Information Institute). In result, Microsoft Corporation won the Supreme Court’s vote seven to one because the company merely sent NetMeeting’s code, which is not covered in Section 271(f) (Chicago-Kent College of Law). Contrarily, when AT&T initially filed a law suit against Microsoft, the District Court ruled in favor of AT&T, stating that Section 271(f) of the Patent Act stated “components” of the patent are protected, which is not limited to machinery and other items listed in Section 271(f). The District Court also stated that the copies of NetMeeting made abroad were supplied from the United States because the coding was created in the U.S., holding Microsoft liable of infringement. The Federal Circuit ruled in favor of AT&T as well, stating that software code was protected under Section 271(f) because it is classified as an invention. However, the Federal Circuit also explained that AT&T’s solution lied in the foreign country’s law, not the United States’ law. Nevertheless, the Federal Circuit ruled in favor of AT&T. Meanwhile, Microsoft contended that software code cannot be protected under the Patent Act because it cannot be a component of an invention. Microsoft supporters stated that if AT&T were to win the suit, new patent laws would be set in place, making software created in the United States more expensive which would lead to a decline in foreign software competition. Others supporters, including the Supreme Court, stated that the software coding in question
AT&T’s suit won over the district court and found Microsoft liable for infringement. However, Microsoft disliked the district court’s ruling at appealed the case to the Federal Circuit, which is the only appellate court with the authority to hear appealed patent cases, only to be charged as liable for a second time. The Federal Circuit looked at one of the few similar cases that was heard in the past, Deepsouth Packing Co. v. Laitram Corp. Laitram Corporation held a patent on a shrimp cleaning machine and Deepsouth Packing proceeded to send a similar machine abroad to be copied by foreign manufacturers. When Laitram filed a law suit against Deepsosuth, Laitram won because Deepsouth sent a machine, an item covered in Section 271(f), and Deepsouth was convicted of infringement. Again, Microsoft questioned the credibility of the two court’s rulings and appealed the case to the Supreme Court. In 2006, the Supreme Court finally agreed to hear Microsoft’s petition and granted it a writ of certiorari (Legal Information Institute). In result, Microsoft Corporation won the Supreme Court’s vote seven to one because the company merely sent NetMeeting’s code, which is not covered in Section 271(f) (Chicago-Kent College of Law). Contrarily, when AT&T initially filed a law suit against Microsoft, the District Court ruled in favor of AT&T, stating that Section 271(f) of the Patent Act stated “components” of the patent are protected, which is not limited to machinery and other items listed in Section 271(f). The District Court also stated that the copies of NetMeeting made abroad were supplied from the United States because the coding was created in the U.S., holding Microsoft liable of infringement. The Federal Circuit ruled in favor of AT&T as well, stating that software code was protected under Section 271(f) because it is classified as an invention. However, the Federal Circuit also explained that AT&T’s solution lied in the foreign country’s law, not the United States’ law. Nevertheless, the Federal Circuit ruled in favor of AT&T. Meanwhile, Microsoft contended that software code cannot be protected under the Patent Act because it cannot be a component of an invention. Microsoft supporters stated that if AT&T were to win the suit, new patent laws would be set in place, making software created in the United States more expensive which would lead to a decline in foreign software competition. Others supporters, including the Supreme Court, stated that the software coding in question