Vienna - January 23, 2020

An API is an essential tool that functions as a shortcut for allowing developers to use existing codes and integrate functions into their own programs rather than re-writing them. The level of IP protection of an API varies between different jurisdictions.

For example, the Oracle Case in the United States has firmly established that APIs are entitled to copyright protection with the exception of fair use of such APIs, which is determined by a competent court on a case-by-case basis (e.g. transformative use).

On the other side of the pond, the European Union Court of Justice has ruled against copyright protection (SAS v. VPL case) in order to prevent the monopolization of ideas that may curtail technological industrial progress. And what about the different Patent Law regimes and use of APIs that are within patented processes?

Many clients are often rightfully puzzled by the legislative differences when their APIs are used in a cross-border setting. Indeed, for instance, it is impossible to protect APIs in Europe through a unified cross-border patent registration process. That is why, we think that putting in place comprehensive API License Agreement and Terms of Service for End-Users is critically necessary. Indeed, these types of agreements may mitigate such disparities between national jurisdictions and allow you to protect your business’ IP and third-party information in a tailored manner.

The extent of protection

Does your business model allow mashups as well as commercial use of related-third party and your web services? In the event that it does, the API provider should be accurately credited. If it does not, then the conditions of use of the API should be drawn out in detail.

When drafting an API License Agreement, it is also prudent to implement clauses that unequivocally prohibit Reverse Engineering for Data Protection. Our longstanding professional experience in this field demonstrates that License Agreements as such help our clients to proactively make decisions in determining to what extent end users and developers are authorized to use their data and services, with the additional benefit of eliminating liability for unlawful use of such data.

We also usually suggest inserting in these agreements a strong Warranty Clause as it is imperative in common practice, since availability of services may not be constant due to various circumstances.

If you wish to learn more about how you can protect your IP assets, please do not hesitate to contact us, we will be happy to help!

Kanije Hablemitoglu MEDUNA