## Facts

- AT&T owned a U.S. patent covering an apparatus for digitally encoding and compressing recorded speech.
- Microsoft’s Windows operating system included software code (including a speech codec) that, when installed, enabled a computer to perform the patented speech-processing functions.
- Microsoft sent a small number of “master” copies of Windows from the United States to foreign computer manufacturers, by disk or encrypted electronic transmission.
- Foreign manufacturers made multiple copies abroad from the masters and installed those copies on computers manufactured and sold outside the United States.
- None of the computers at issue were sold in the United States.
- AT&T sued Microsoft alleging infringement under 35 U.S.C. § 271(f) based on Microsoft’s alleged supply from the United States of components of a patented invention for combination abroad.

## Issues

1. Whether software code can be a “component” of a patented invention under 35 U.S.C. § 271(f).
2. Whether foreign-made copies of software, created abroad from a master sent from the United States, are “supplied … from the United States” under § 271(f).

## Decision

- The Supreme Court reversed the Federal Circuit and held Microsoft not liable under § 271(f).
- The Court ruled that Microsoft did not “suppl[y] … from the United States” the “components” installed on the foreign-made computers because the installed copies were made abroad.
- The Court emphasized the territorial limits of U.S. patent law and treated § 271(f) as a narrow statutory exception that should not be expanded by judicial interpretation.
- The Court reasoned that abstract, uninstalled software code is akin to a blueprint; Windows becomes relevant to infringement only when embodied for installation and actually installed to make a computer capable of performing the patented function.
- The Court concluded that the foreign act of copying from the master was an essential step occurring outside the United States, placing the conduct outside § 271(f) as written.

## Legal Principles

- U.S. patent law generally does not apply to making and selling products abroad; § 271(f) is a limited exception covering the supply from the United States of components for combination abroad.
- For § 271(f) liability, the relevant “components” must be the items actually combined abroad; exporting a master that is not itself installed does not amount to supplying the foreign-made installed copies from the United States.
- Uninstalled software code, standing alone, is treated as intangible instructions rather than a physical component for purposes of determining what is supplied for combination; installation/embodiment in the combined product is central to infringement analysis.
- Any broader extraterritorial reach for U.S. patent law in the software-copying context is a matter for Congress, not courts; protection against foreign copying typically depends on obtaining and enforcing foreign patents.

## Conclusion

The Court held that § 271(f) did not reach foreign installations of Windows where only a master copy was sent from the United States and the copies installed on foreign-made computers were created abroad, reaffirming the territorial limits of U.S. patent law and leaving further expansion of § 271(f) to Congress.


Microsoft Corp. v. AT&T Corp., 550 U.S. 437 (2007)