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This article was first published by E-Commerce Law & Policy on 1August 2012, and is reproduced by kind permission.

May 2012 was an important month for copyright judgments in relation to software development and what aspects of a computer program can be protected by copyright, both in the UK and the US. Philip James, Partner at Pitmans SK SPort & Entertainment LLP, assesses both the UK and US decisions and compares the issues under contention in each case.

The UK Perspective

On 2 May the European Court of Justice (ECJ) decided in case C-406/10 that the functionality of a computer program and the programming language cannot be protected by copyright. In SAS Institute Inc. (SAS) v World Programming Limited (WPL), the High Court referred questions to the ECJ regarding the scope of the legal protection conferred by EU law on computer programs and whether the protection extended to programming language.

SAS is the developer of the SAS System, the statistical analysis software, and the SAS Language introduced to enable users to write their own application programmes (scripts) to personalise the SAS System. SAS claimed that WPL had infringed SAS’ copyright by copying and reproducing the functionality of the SAS System to create an alternative software, the ‘World Programming System’, capable of executing application programmes written in the SAS Language (WPS Programmes). In so doing, WPL acquired copies of the Learning Edition of the SAS System supplied under a licence which restricted usage to non-production purposes. WPL then studied the functionality of the SAS System to develop the WPS Programmes; WPL did not have access to the source code of the SAS System components or copied any of the text or the structural design of that source code.

The ECJ ruled that formatting of data files used in computer program to exploit its functions, functionality of a computer program and the programming language does not constitute a form of expression and as such fell outside of the protection conferred by the Council Directive 91/250/EEC in relation to  the legal protection of computer programs. They went on to say that any contractual provision restricting the right of a purchaser of a software licence to observe, study and test the software to determine the idea and principals which underlie any element of the program is null and void.

The ECJ concluded that, ‘to accept that the functionality of a computer program can be protected by copyright would amount to making it possible to monopolise ideas, to the detriment of technological progress and industrial development’.  A word of warning: it is important to note that the fact that a developer does not have access to the underlying source code does not mean that someone who replicates a program’s functionality may not infringe an original developer or licensor’s rights in the prior program. The case will be decided on its facts and, where a developer has had access to a sufficiently detailed specification, manuals or designs from which the relevant program was borne (i.e. not just high level designs but plans which are only ‘one-step removed’ from the software itself, following the decision in Bezpečnostní softwarová asociace case (No. C-393/09) ), this form of reproduction may still constitute copyright infringement. In addition, the case followed the principle established in Infopaq International A/C v Danske Dagblades Forening (No. C-5/08), namely that:

(a) where something is the author’s own intellectual creation, it is protectable as a copyright work; and

(b) part of a work will be protected by copyright if it contains elements which are the author’s own intellectual creation.

For this reason, software developers need to be vigilant and carefully manage the processes and environment in which programs are developed where such programs are intended to replicate prior existing software. Consequently, the case has returned to the High Court in London and the dispute between the parties will be decided in the UK accordingly.

The US Perspective:

The ECJ decision was reported when the trial on resembling issues between two American giants Oracle America Inc. (Oracle) v Google Inc. (Google) was underway in San Francisco (a battle which is akin to two sparring America’s Cup boats). On the very last day of May 2012, a judge in the District Court in the Northern District of California delivered a decision following a six weeks trial of the first of the co-called ‘smartphone war’ cases per judge’s own description.

In 2010 Oracle acquired Sun Microsystems, Inc., the developer of Java programming language and Java platform. Oracle subsequently accused Google of infringing Oracle’s copyright in Java by replicating 37 application programming interfaces (APIs) in Google’s Java-programmed Android platform. Oracle did not allege that Google had copied the 37 API packages (apart from the eight files of code which Google admitted to have copied, but which was not part of Android). Instead, that Google had developed its own version for Android.

The main question at issue was the extent to which elements of the structure, sequence and organization of the Java API replicated in Google’s Android platform were protected as a copyright work and, in particular, whether the elements of a platform (Java in this case), which had been copied (albeit in the absence of copying the underlying Java code) constituted works which infringed Oracle’s copyright or, unless patented, were free for others to use.

As the trial in California unravelled, the analysts, software start-up investors and independent programmers observed it in a state of panic, posting warnings in blogs and other media that a judgment in Oracle’s favour would result in an irresolvable conflict between European and US concepts of copyright protection.

A decision in Oracle v Google was delivered much ahead of schedule (the trial was expected to last till the end of June). The case has highlighted the stark contrast between copyright and patent protection in software development.  Oracle has since indicated it will appeal.

The Judge Hon William Alsup wrote an astonishingly clear and technically flawless decision, having revealed at trial that he does a fair bit of programming himself. In reviewing Oracle’s copyright infringement claim, the learned Judge ruled that the following principles should be applied:

• where there is only one (or a limited few) ways to express something, then no one can claim ownership of such expression by copyright – this is called the ‘Merger Doctrine’;

• names and short phrases (like class names used in Java and replicated by Google in Android) are not copyrightable – the ‘Names Doctrine’;

• copyright protection does not extend to any idea, procedure, process, system or method of operation or concept regardless of its form;

• functional elements essential for interoperability are not copyrightable;

• copyright protection should not be offered merely to reward an investment made in a body of intellectual property.

The judge readily recognised that the design of methods of Java’s API was a creative endeavour but concluded that such inventions at the concept and functionality level should only be protectable by patent. Significantly, the method specifications were not infringed because the rules of the Java programming language required these to be identical for the Android API to ‘talk’ to Java.

The resulting order holds that under US copyright law no matter how creative or imaginative a Java method specification may be the entire world is entitled to use the same method specification (inputs, outputs, parameters) so long as the line-by-line implementations are different.  Similarly, the Judge rejected Oracle’s argument that the arrangement of methods in classes in Java is a taxonomy and its repetition infringes copyright; instead the court found that the arrangement of methods of operation, despite being original and creative, merely resembles a taxonomy but is not such and can only be protected under a patent, but not in copyright. ‘To accept Oracle’s claim would be to allow anyone to copyright one version of code to carry out all or part of the same commands. No holding has ever endorsed such a sweeping proposition’.

It should be noted that the court held that this decision was very fact-specific and should not read to mean ‘that Java API packages were free for all to use without licence, neither that that structure, sequence and organisation of all computer programmed may be stolen’.

Summary

The decision of the ECJ and the Northern District Court of California suggests that software developers may wish to consider whether or not to patent the elements of their method specifications, structure, sequence and organisation of the software products. In so doing, however, it will be necessary to weigh up the advantages and disadvantages of seeking such patent protection e.g. the cost, as well as the requirement to disclose such methods may, in itself, justify a decision not to proceed with a patent application strategy and corresponding patent protection.

Both decisions underline the need for developers to undertake a detailed risk assessment before investing in developing software products that run a significant risk of replicating similar technology and elements of software programs. In the absence of making such an assessment, developers (and licensees in turn) may be running the risk of gambling whether their resulting products may be found to infringe copyright in prior programs, despite there being no copyright in a functionality of a computer program. Managing the development process and deploying techniques during production may also help to minimise such risks.

Philip James
Partner, Pitmans SK Sport & Entertainment LLP
T: 0207 634 4655
E: pjames@pitmans.com