good afternoon may please the or the court my name's criticizing burke for palance it's gassing drew again or the injunction in this case was issued based on a click track clip click crap agreement and the interpretation and that was clearly erroneous the district court's interpretation itself also would run afoul of anti competitive statutes and rules of the new york state in arguing with any of the facts by the court you disputing any of the facts so i wouldn't is better at least from my perspective are you suggesting that any of the facts found by the court are clearly erroneous we believe that the that the process used of not looking at or not filtering out evidence that is in the public domain and is not proprietary that relying on that is erroneous in other words the six components that of this technology that the court relied on for saying this was derived from there are ones that are clearly in the public realm and are things in which there is no proprietary interest by broker genius and so therefore relying on those as your succeed but that as a matter of law the requirement under a under the court's interpretation so first if they if the court is erroneous in not applying the copyright one o six standards and saying a derivative work is just a derivative work within the meaning of a copyright law copyright law has a very clear order for it is this the right laws allies this is a contract a user contract that's right but these it clearly erroneous first of all is don't we have to find it's clearly erroneous that your client signed on to the fine and that your client signed onto that no because we are proceeding on this appeal on the basis that there is an agreement in place a judge stein writes that both sides asked him to use the merriam webster definition of derived for the purpose of construing that provision so whether or not on a clean record the argument would have been that derivative work has a term of art copyright meaning didn't both sides including yours tell him no this ought to be defined in this way and the corollary is after he said that did you seek reconsideration on the ground that you had been misquoted when he said that both parties asked that the dictionary definition be used both parties did not in fact i think that same footnote that you're referring to he clearly states that our argument proceeded both on a pre hearing and post hearing on the derivative work argument in other words that in fact says you know that we argued it and said that prior art for instance would preclude as a matter of law and we were going off request that he applied the copyright analysis to have how copyright law could actually inform this there is at this stage no copyright claim in the case that's right there isn't and this determination that the court was asked to make was not being made on the basis of any claim that the plaintiff program was copyrightable at all is that right their program was actually the code itself is is copyrighted the reason why the copyright claim was withdrawn by them they did originally proceed on that was because their claim would fail under that copyright  process no doubt it would so at this point we're operating on the assumption that there is no comedy right claim there is no claim before the court actually that any element of this program is copyright purposes but you can't make any derivative work from that and the work in the first place is not copyrightable for any of a hundred reasons how would one even go about asking what could it mean to say a derivative work as informed by the copyright law if what i'm handing you isn't copyrightable in the first place there would be no elements there be no such thing as a derivative work then isn't that right i'm sorry i may have misunderstood your question earlier in responding to it there clearly are elements of their claim that are subject to a copyright we can't simply go and this claim is and in other words the contract claim the question is what does the contract mean by a derivative work the supposed the contract did not refer to a copyrightable element at all does the mere use of the term derivative work mean there can't be a derivative work because that's a copyright term and you haven't got something copyrightable no under the con under a contract analysis one looks at what a reasonable reader would view they're the ones who drafted this they put it in it's a standard form actually and someone looking at this and saying what am i prohibited by from this clause from doing would as judge stein did in the first case in this all to case look at this and say all of these things are copyright terms of art and if you plug it into a computer what comes up is that copy of a derivative work is something in the copyright context and so someone looking at this would say ah the copyright holder here has the right to control whether or not to brantley a to the right to create a derivative work and in doing so what they're saying in this license is no you don't have that right to create a derivative work as it's used in the copyright context what what the judge did in taking out of the copyright context is also something that even if you look at it just in terms of using the words derivative derived from still ha to take and filter out items that are in the public realm if something is is a proper is not a property right that broker genius has if something has been put into the public realm and here we have the patent we have the judge determining that this is not a trade secret everybody else in the world would have the ability and the right to do this except for mr again isn't that true of any contract that anyone else in the world can do promised not to do x therefore i have an obligation that everybody else in the world doesn't have that's why this is not a claim to a monopoly in the idea if i tell you if this happens all the time i think in the development of computer programs and all kinds of other things i say to you look i'll share with you what i've got but you have to promise me you're not going to use that to create some new work based on my idea well we're obligated not to make anything based on my idea even if i could not claim against the rest of the world a copyright in the idea but if that idea has already been made public ruckelshaus says you have no particular property right and it has been extinguishe violation of public policy to form a contract like that well this court has said that in the cry vs duro case last year which says exactly that that a a former licensee who agrees not to then make this sort of good going forward that that is an unreasonable restriction that because the contract can restrict you from using proprietary information of course that's a standard non competition provision but if it goes beyond that and says i'm also going to try to protect stuff that's in the public realm that i have no property right and then that is an unreasonable restriction that the restriction cry versus dura six eighty nine f says looking to the new york law you have to have a covenant protecting a legitimate business interest which here if the rest of the world can do this and if they have created a patent and published it which as the court knows creates the enable anyone else can build this using this blueprint and then it also would have to be reasonable in terms of its time and its scope this here is a lifelong ban apparently on mr gainer from using something that is in  non compete clause in effect was that an argument was made in the district court ark our answer does say that this would be an unconscionable interpretation however we were dealing with an interpretation and in fact on appeal here they recognize this and have scaled back their argument on page forty eight their claim is simply that this should be interpreted to to prevent the copying of proprietary technology so in other words they aren't claiming that this even extends to nonproprietary technology because they know that would transfer across the boundary into a non compete non compete so the question then is is this proprietary technology and i think on our brief on page fourteen we have a chart that shows exactly that every single component that the district court cited is something that is in the public domain and the six widgets the architecture and the scale ability all of those components are things that in two thousand and fifteen were put into the public domain and according to the ruckelshaus decision their profit and their property interest in that has been extinguished and according to the you know the federal court saying that that's part of the patent bargain that when you say this is how you do it these are the components this is the enablement clause of how you go about building it the rest of the world could do it and if you interpret this agreement not to be restricted to their proprietary technology as as they are now trying to argue but to expand beyond that to include stuff that is obvious that is you know not proprietary then that becomes that runs afoul of the restrictions on competition correct this is a contract case it's a contract with an ambiguous language both sides agreed that it was voluntarily entered into and mr gainer agreed not to make a derivative product of broker genius's author price or in order to get access to that product if he didn't agree to that he wasn't going to get access but but that begs the question of what he's agreeing what one of the arguments that at the time he clicked through it before copyright claims have been made in disposed of in this litigation the word derivative work had a term of art meaning  and its surrounding terms are also familiar from the world of copyright but that's not true and there is no term of art meaning here when judge starr looked at this language in terms of use in the sultana case which was a trade secret case he was looking that to see whether that clause provided a confidentiality requirement he did not import the copyright law to supplant contract law he didn't implant the copyright law to interpret this contract and he makes that clear in fruit no fourteen in the preliminary injunction order what mr rushton is not really what judge stein did but just as and original matter if you looked at that clause one way of looking at it is to use the dictionary definition of the merriam webster another way would be to if you know that the clause takes on meaning from the surrounding words and i guess the question is in original matter why is one why is your position more right well for the other for the reason that that's not the only clause that talks about you can't make a derivative work when mr kreiner signed signed onto this contract there was an ownership of that content and grant of conditional license section one part of that says you maine you agree that you will not otherwise attempt to derive any source code or underlying ideas or algorithms of any part of the site or the apps i'd also it also to do right imagines is picking up on their other derived language yes and then it goes on to say you may not reproduce modify that originates from something else and defendants are expert miss martin defined derived as something that originates from something else the truth is here the public demand that is not true the components that are in the software the individual components that are put together to make this innovative out of price of product we are not claiming that they're not in the public to mean we are not saying they're patentable copyrightable trade secret what we are saying is the combination the special combination of both components results in a very special specific architecture that allows this product to have a unique user interface and user experience broke out in that simplistically for my simple mind there are a number of things out there in the public domain but what is being protected here is the way that those have been put together in order to achieve a final product roca genius that four million dollars and many many years developing what's known as requirements and generic where you put it together one way you get customer feedback it's a trial and error process it's a roadmap to get the optimized product when mr gainor used quick point pencil company at four forty us to fifty seven thousand nine hundred seventy nine and there the court refused to supplant percent royalty if the patent issued within five years and two and a half percent if it didn't issue well as it turned out the patent didn't issue and the supreme court sat that the or a probable grant will and this is important because as it stands broker genius is proprietary technology may not be considered encourage invention in areas where patent law does not reach and will prompt the independent individual innovator to proceed with the discovery and exploitation of this invention competition is fostered and the public is not deprived of the use of valuable if not quite patentable invention there is nothing anticompetitive about broeker genius having a terms of use one a former customers who copied their product two of them at freely admitted and accepted a permanent injunction admitted that they had copied the third is  scott's broker genius has never brought a suit against any other company using another type of pricing to everybody is free to use these components what you're not free to rosenberg very briefly the argument that the unique components are a trade secret was dispensed by judge the judge in the salt a decision he said users are free to take their particular user interface and broadcast it to the world and so the argument that somehow there is something some secret that mr gainer gained access to that he otherwise would not have been able to that is a trade secret and is proprietary is just incorrect and judge stein held that it was incorrect the other thing that runs counter to the argument about this being proprietary or somehow the unique combination argument is it was presented exactly to the patent office on page eleven through thirteen of our reply brief we present side by side each component that the judge identified in his decision here as the basis for what was copied and the corresponding part in the patent office which goes through in greater detail the exact unique combination of these things of how you do this and that ultimate conclusion of the patent office the trained examiners somebody who deals with this technology all the time is that this was obvious it says simply using a process that has been used by ticket brokers all the time is not something that makes it you know i obvious and the finding of obviousness separate from the disclosures later on you can have a right and then lose it but an obviousness determination precludes as a matter of law i claim a derivation is it correct that your expert argument about derivation and said for purposes of the of this i will look at this under the definition of derivation r briefs however as i said if you go back our chapter and verse on the the reasonable interpretation as the judge found that if someone looks at this term of at this and says what does derivative works mean at a minimum they would say it's in the context of what does a derivative work in the copyright means i can't copy the site and but otherwise even under the word derive more derived from any law requires you to filter out stuff that's in the public domain because they don't have the right to that anymore do you just tell us what is the state of play in the district court now is there a trial scheduled or what's what's happening yes we have a trial scheduled for december seventeenth and we are still enjoined at this point and out of business and is  that a bench trial because basically for an injunction or is there more to it you know no this is the judge a full jury trial on the contract and in the definition of that term is settled in that trial from the