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Oracle Court Win Creates Tech Primal Scream

Stocks in this article: ORCL GOOG AAPL MSFT

NEW YORK (TheStreet) -- The technology press has issued a primal scream following Oracle's (ORCL - Get Report) win over Google (GOOG) at the U.S. Circuit Court of Appeals.

To the financial press, it looks like an ordinary copyright case. The technology press considers it a direct attack on both innovation and the work of making software work together. The Electronic Frontier Foundation called the decision dangerous. 

A court in California, where both companies are based, had ruled for Google that Application Program Interfaces (APIs), which list what programs do and enable connections between programs, cannot be copyrighted.

APIs are considered essential to making programs compatible, Judge William Alsup had ruled in 2012, and thus should not be subject to copyright. But the three-judge panel at the Court of Appeals either didn't understand that or didn't care, according to the tech press.

The repercussions could be immense. Open-source programs such as Samba, which has provided interoperability between Apple (AAPL) Macintoshes and Microsoft (MSFT) Windows machines for over two decades, could become illegal.

Java had been made open source in the last decade by Sun Microsystems to encourage people to write programs once and run them anywhere. That effort succeeded, but after Oracle bought Sun it used the copyright claims to retroactively make everything proprietary again.

To lawyers who work in technology, the case should never have gone to trial. The case of Baker vs. Selden, decided by the Supreme Court in 1880, should have protected Google's use of the copy-written code, he wrote this weekend. 

To the technology press, this decision risks making every open-source license conditional, with a future owner of the code able to demand monopoly rents on old functions by enforcing copyright. It could also make "reverse engineering" code, to get at its functions, illegal.

To Timothy Lee at Vox, for instance, this is precisely what the court has done in enabling patent trolls, which is estimated to cost the economy $60 billion per year.  Failed inventions are re-interpreted to fit actual inventions and whole industries become subject to a legal shakedown.

In the near term, the ruling means Oracle can demand money from Google for using Java in its Android operating system, unless Google can now prove that its use of the APIs falls under the "fair use doctrine," the way this column would be treated in regards Oracle's Java copyright claims.

The decision could move the case back to California courts to consider that question, or Google could appeal the latest decision to the full court, even to the Supreme Court. So far it has had no impact on the price of either stock.

That could change.

>>Read More: IBM Unveils Watson Technology for Enterprise

>>Read More: Beats Doesn't Make Sense for Apple

At the time of publication the author owned shares of Google and Apple.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

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