GitHub, Microsoft Had No Contractual Obligation to Programmers Whose Code They Used to train Copilot

ARGUMENT

IV. PLAINTIFFS’ TORT AND UCL CLAIMS FAIL.

B. Plaintiffs Do Not Plausibly Allege A Contract Or Business Expectancy, Nor Defendants’ Knowledge Of One As Required For An Interference With Economic Advantage Claim.

Plaintiffs’ tortious interference claim (Count III) against GitHub and Microsoft is deficient in multiple other ways. “Tortious interference with contractual relations requires (1) the existence of a valid contract between the plaintiff and a third party; (2) the defendant’s knowledge of that contract; (3) the defendant’s intentional acts designed to induce a breach or disruption of the contractual relationship; (4) actual breach or disruption of the contractual relationship; and (5) resulting damage.” Ixchel Pharma, LLC v. Biogen, Inc., 9 Cal. 5th 1130, 1141 (2020) (quotation marks omitted). The Complaint falls short on every element.

Although Plaintiffs label their claim one for tortious interference with contract, they identify no contractual relationship between themselves and anyone else—much less a contract that GitHub and Microsoft knew about. See Compl. ¶¶ 188-93; see also Bed, Bath & Beyond of La Jolla, Inc. v. La Jolla Vill. Square Venture Partners, 52 Cal. App. 4th 867, 878 (1997) (plaintiff must allege an existing, enforceable contract). While Plaintiffs allege that they deposited materials in public GitHub repositories subject to open source licenses, they do not allege that any third party ever entered into a contract with them in regard to those materials. Nor do Plaintiffs plausibly allege that GitHub or Microsoft committed “intentional acts designed to induce a breach or disruption” or “actual breach or disruption” with respect to an open source license granted by Plaintiffs to any unidentified third party. Ixchel, 9 Cal. 5th at 1141. All they allege is that “[a]t GitHub’s upcoming yearly conference, GitHub Universe 2022, it will host a presentation called ‘How to compete with open source—and win.’” Compl. ¶ 190. Plaintiffs construct their claim on a tortured interpretation of this title, as though the presentation provides a blueprint on how to compete against open source, when the more natural reading is that it is about how to compete effectively using open source. But in all events, this is hardly an allegation of a specific act to knowingly interfere with specific contracts. And in any event, “compet[ing]” and “win[ning]” is not a tort. See Ixchel, 9 Cal. 5th at 1142. The Complaint therefore states no claim for intentional interference with contract against GitHub or Microsoft.

The Complaint also fails to state a claim for the related tort of interference with prospective economic advantage. Although “[t]ortious interference with prospective economic advantage does not depend on the existence of a legally binding contract,” it still requires a plaintiff to “show that the defendant knowingly interfered with an economic relationship between the plaintiff and some third party, which carries the probability of future economic benefit to the plaintiff.” Ixchel, 9 Cal. 5th at 1141 (cleaned up). Specific known relationships must be identified. Westside Ctr. Assocs. v. Safeway Stores 23, Inc., 42 Cal. App. 4th 507, 523-28 (1996); Rosen v. Uber Techs., Inc., 164 F. Supp. 3d 1165, 1178-79 (N.D. Cal. 2016).

Here, Plaintiffs fail to allege any specific relationship with a reasonably likely economic benefit that GitHub and Microsoft knew about and intended to interfere with. The Complaint merely asserts that “Defendants have wrongfully interfered with the business interests and expectations of Plaintiffs and the Class by improperly using Copilot to create Derivative Works that compete against OSC.” Compl. ¶ 189. This conclusory “the-defendant-unlawfully-harmedme accusation,” Iqbal, 556 U.S. at 678, does not identify the “economic relationship” supposedly interfered with or plausibly allege the “probability of future economic benefit” claimed to be disrupted. Nor does the Complaint allege “actual disruption” or specific “harm,” two additional elements of the claim. Korea Supply Co. v. Lockheed Martin Corp., 29 Cal. 4th 1134, 1153 (2003). As a result, the Complaint does not state a claim for any economic interference tort.