MPL section 2.2, and patent grants on derivative works

[Brian Behlendorf]

Apologies if this is retreading old ground, and off-topic since it's not
about approval of a license, but we're working on the next version of the
Apache license and are looking at the patent language in various licenses.

I'm trying to tell if the patent grants by Contributors described in
section 2.2 apply to derivative works, either published by the same entity
as the Original Code, or a third party).  My read of 2.2 (IANAL, etc)
suggest that the patent grant *only* applies to the specific Contributor
Version, e.g. the Original Code plus the Contribution to which the patent
applies.  E.g.:

  Each Contributor hereby grants You a world-wide, royalty-free,
  non-exclusive license [...] under Patent Claims infringed by the making,
  using, or selling of Modifications made by that Contributor either alone
  and/or in combination with its Contributor Version (or portions of such
  combination), to make, use, sell, offer for sale, have made, and/or
  otherwise dispose of: 1) Modifications made by that Contributor (or
  portions thereof); and 2) the combination of  Modifications made by that
  Contributor with its Contributor Version (or portions of such
  combination).

What happens to a derivative work of the Contributor Version?  E.g., the
developers at Mozilla.org merrily commit the patch corresponding to that
Modification from said Contributor, and then make another commit, and
another, then make a release.  Given the language in the license, how does
that patent grant apply to this new work?  This new work is not the
"Modification alone", nor is it the "Contributor version", nor really "a
portion of such combination" - it contains the Modification, but even that
Modification may end up modified at some point.

2.2(d)(3)(i) appears to suggest that "third-party [who's a third party?]
modifications of Contributor Version" don't get that patent grant; neither
do those who "combine with other software".  Yikes!  That only further
confuses the situation.  Does putting Mozilla on a CD with some "other
software" and calling that a product constitute combination, and thus
lose the patent grants?

The root question for us (Apache) is, does a contributor grant need to
explicitly state that a grant of a patent license on a contribution
applies to derivative works of the resulting "contributor version".  If
that's the case, some say we need to limit the types of derivative works
it can apply to, since allowing any derivative work to carry the patent
grant would mean that anyone with a commercial product who wanted to use
that patent without paying could do so by pulling the right Apache code
into their own.  Limiting it to derivative works published by the ASF is
one option, published under any open source license is another.  But we'd
really prefer not to invent new language here, so I'm trying to understand
language like this in existing licenses.

	Brian

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