Software companies are not immune from patent infringement lawsuits.  In discovery, these companies often do not want to produce their source or object code because of its highly confidential nature and the risk that copies of the code could be leaked outside of the litigation.  In order to prevent disclosure of the source code, software companies often argue that their user manuals and the like are sufficient to show how the product operates for the purpose of patent infringement.    While this argument often persuades the court , one court recently ruled that its local patent rules expressly require that the accused software source code be produced regardless of confidentiality concerns.

In Ioli Trust et al. v. Avigilon Corp (.pdf), 2012 WL 5830711 (E.D. Tex. Nov. 16, 2012), Judge Gilstrap ruled that Local Patent Rule 3-4 alone requires that source code be produced when it is accused of infringement.   Local Patent Rule 3-4(a) provides that “the party opposing a claim of patent infringement must produce or make available for inspection and copying: (a) Source code, specifications, schematics, flow charts, artwork, formulas, or other documentation sufficient to show the operation of any aspects or elements of an Accused Instrumentality identified by the patent claimant in its P.R. 3–1(c) chart.”

The defendant argued that the plain text of P.R. 3–4(a) mentions “source code” but does not require its production because of the disjunctive “or” used in the rule which authorizes seven other distinct categories of documents by which the defendant can comply with the rule.   In opposition, the plaintiff argued that that among the 21 “technical” documents produced by the defendant, only two described the functionality of the accused software, and that those two documents did not provide sufficient descriptions of the operation of the accused software.  In his ruling, Judge Gilstrap reasoned that Local Rule 3–4(a) requires that the alleged infringer produce any and all documents describing the operation of any aspects or elements of an accused instrumentality. “P.R. 3–4(a) clearly covers source code, regardless of what additional materials may exist to disclose the functionality of the technology at issue.”  The rules require the defendant ”to produce more than the bare minimum of what it believes is sufficient including but not limited to any and all source code….” (emphasis in original)   What may be saving a saving grace to future software defendants in this District was Judge Gilstrap’s recognition that the software defendant did not offer any declarations or the like explaining why its non-source code disclosures were sufficient.

Key Takeaway:

Software companies accused of patent infringement in Eastern District of Texas should be prepared to disclose their source code pursuant to the local patent rules, or at least offer persuasive declarations that explain why source code need not be produced.