The Failure of Software Copyright Law
C1C David Croft
Law 420
Major Schmitt
19 April 1990
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A Definition
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With the Copyright Act of 1980, the following was added
to the existing copyright laws:
A "computer program" is a set of statements
or instructions to be used directly or indirectly
in a computer in order to bring about a certain
result.1
A "program" or "software" instructs the "hardware," the
computer, in its task of adding, storing, exchanging data,
etc.2 At the base level, a program is simply a mathematical
algorithm, a stream of on/off states, which the hardware
uses.
Copyright and patent law has generally excluded
mathematical algorithms from legal protection due to the
social benefits of their widespread dissemination.3
Software, however, is primarily protected by copyright law
under the premise that an author is entitled to the
financial incentive. The debate is this: "Is there a way
to protect innovators without strangling further
innovation?"4
The Harms of Protection
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Early makers of computers handed out free accompanying
software particular to their machines.5 Their thought was
that this would encourage the purchase of their hardware.
Soon, however, software producers began to copyright their
products and the result was that each computer-maker had
incompatible software.6 A company with sufficient lead-time
over its competitors would push its particular version of
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software on the consumers in the hope that it would become
an industry standard. Once this had occurred, the company
would have a virtual monopoly -- held in place by legal
protection.
The effect is as though someone were to patent the
"QWERTY" format of a keyboard. Unless competing typewriter
manufacturers wanted to come up with their own keyboard,
they would be shut out. However, this is exactly what they
did -- each developed its own software.7 The harm to
society is in learning time. "Users" of software are more
productive on "user-friendly" programs -- which generally
tend to be those they are more accustomed to. Think of the
cost of retraining a secretary to type on a non-standard
keyboard every time you buy a typewriter from a different
company.8 The social needs for the benefits of industry
standardization are pressing: "If you want to get something
done, you don't want to have 50 different [program]
languages."9 Without legal protections, incompatible
software would normally be an automatic market failure.10
A degree of compatibility allows innovations on
existing works to appear, unless the original work is
copyrighted. Progress in the software industry is primarily
based on the rapid assimilation of new ideas; the key word
is rapid.11 Copyright law grants protection for up to 75
years after the death of the author -- an extremely long
duration in which programs are developing by orders of
magnitude every few years.12,13 Apple Computers introduced
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an "icon" system of file management in which users simply
point to a pictured trash can to erase a file. When
Microsoft and Hewlett-Packard attempted to emulate, Apple
sued and the software users lost out.14 When Fox Software
created a version of dBase's database program that was more
than twice as fast, dBase sued and the users lost again.15
If the protection is interpreted too broadly by the
courts, a company may have a virtual monopoly over an idea.
If the author of the first word processor had been able to
copyright that type of program, word processors today would
be less developed and more expensive -- as expected of a
monopoly product.16,17 Progression is based on past
experience: "We stand on the shoulders of other giants."18
Whether copyright law is as expansive as to disuade
improvement is the decision of the courts which interpret
it.19
The legal costs which protection promotes is high.
Many defendants in copyright infringement cases are
countersuing; they claim that the plaintant companies are
using the suit as a delay tactic.20 Ashton-Tate and Lotus
appear to be using their lawsuit against competitors as a
stopgap in order to gain time to work out the flaws of their
own software.21 Smaller companies which cannot afford the
litigation run the possibility of going bankrupt while the
courts hold their product out of the market. The legal
costs of all this litigation, of course, are passed on to
the consumer.22 The inability to rapidly resolve these
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conflicts may swing the leading tide of innovation to
foreign competitors, particularly Japan.23,24
The Benefits of Protection
__________________________
Thomas Jefferson said of the newly founded patent laws,
"The issue of patents for new discoveries has given a spring
to invention beyond my conception."25 Software company
Ashton-Tate argues that it has spent millions of dollars in
research and has a right to enjoy the financial fruits of it
labors.26 It has long been recognized that without a
limited legal protection after distribution, the incentive
to produce is stymied by research and production costs.
Legal production promotes originality and efficiency in
competing software producers. While most typists prefer the
"QWERTY" keyboard, it is the least efficient set-up for the
English language.27 Since competitors must avoid
copyrighted industry standards, they are forced to produce
original, and usually more efficient, products. In time,
the industry standard seeks better methods in a Darwinian
fashion.
Legal protection protects the small producer. Once a
software author has copyrighted his product, he is free to
show demonstrations to large corporations and software
marketers without fear that his work will be stolen.
Although there is still somewhat of a risk, legal
recompensation is significant enough to disuade most
software thieves.28
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Alternative Forms of Protection
_______________________________
Many professionals do not consider the illegal copying
of intellectual property as they would any other theft.29
This is unfortunate as most software can be easily and
rapidly copied by anyone. It was estimated that for every
one copy of a program sold, eight copies were made.30
Copy-protection was seen as one method of slowing this
trend. The software developer makes the sold program
virtually impossible to copy by encrypting its transmission
media.31 The drawback of this was that consumers could not
excercise their right under the 1980 Copyright Act to make a
back-up copy.32 If they lost or damaged their first copy,
they would have to re-purchase the software license along
with another copy. One developer stated that 30% of his
customer service calls regarded copy-protection problems.33
Because of the inconvenience of copy-protection, the defense
industry has refused to purchase any copy-protected
programs. In addition, computer "pirates" were developing
ways to defeat copy-protection systems just as fast as new
ones were developed. Less and less software developers are
relying on copy-protection as a substitute or even as a
complement to legal protection. "To introduce a new product
that is copy-protected would be suicide today."34
Another alternative is to scramble the program code.35
The program continues to function properly on the surface
but it actually making convoluted leaps in its instructions
to confuse any competing developer that might want to trace
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its workings. While copyright registration is still needed
to protect against verbatim copying, it does slow down those
who would wish to "reverse-engineer" the program by
emulating its functions.
Trade secret laws have been held by the courts to be
inapplicable in situations where copyright protection is
available.36 In addition, a product protected under trade
secret laws may be legally reverse-engineered.37 Even
though the exact workings of a program may be a secret,
ingenious developers are finding it easier and easier to
reverse-engineer a product. The Semiconductor Chip
Protection Act of 1984 even promotes reverse-engineering to
spur improved versions of computer instructions.38
A patent protects "the physical embodiments of novel
ideas".39 Until just recently, this has excluded the non-
physical computer programs under U.S. law. The current
standard for a software patent requires a "state of the art"
improvement -- a standard above most typical programs.40
Software Copyright Law
______________________
In 1978, a special committee was formed to consider the
best form of legal protection for computer programs. The
result was the Copyright Act of 1980.41 Copyright
registration is simple; to register, one simply mails the
first and last 25 pages of the code to the Copyright Office
along with the easily-obtained form.42 Since only the
printed code or "expression" is being registered, and not an
"idea" as with a patent, the registration is almost always
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automatically accepted. In addition, a software author may
claim a copyright without registration simply by including
"Copyright Year Name" somewhere within the program.43 An
author may copyright a work up to five years prior to and
after distribution.44 The ease with which copyrights are
obtained facilitates the developer in regards to time and
money.
The problem with copyright is that software developers
are requesting from courts broader rights than merely
"expression"; they are requesting the right to safeguard
their "ideas". Take for example Gone with the Wind: it is
__________________
a literary work ideal for copyright protection. If the
author chooses to restrict her expression of the novel, the
consumer may simply purchase another civil war book. But
what if someone copyrighted the wheel? The consumer would
be restricted from the "idea," and thus cars, for up to 75
years after the inventor's death.45 With a literal
interpretation of the 1980 Copyright Act, only verbatim
copying of software would be restricted and the innovative
ideas would still be available for dissemination to the
public.46 Copyright law states:
In no case does copyright protection for an
original work of authorship extend to any idea,
procedure, process, system, method of operation,
concept, principle, or discovery, regardless of
the form in which it is described, explained,
illustrated, or embodied in such work.47
The courts, however, have not been uniform in their
judgments on such matters.48 The first generation of
infringement suits involved direct copying of computer code,
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usually imbedded in hardware.49 The second generation,
however, involved "look and feel" issues such as the
appearance of characters in a video game.50 The difficulty
lay in the fact that a program was more of "utilitarian"
product than an "expression," and thus was entitled to
"neighboring rights" -- the rights usually granted with a
patent.51 Dependent upon case law and statuatory language,
the courts were making new law as they went along:
"Managers are in the difficult position of
having to run 21st century businesses with
guidance from a 19th-century legal system."52,53
The general trend of the courts was a broad
interpretation which tended to include "idea" into its
protections.54 One court ruled that a "[c]omputer software
developer's internal method . . . [was] entitled to
______
copyright protection.55 A standard that evolved was that a
"look" was copyrightable if there were alternative methods
of implementing the function.56,57,58,59 Thus, if a screen
of data could be displayed by a competitor in another way
that was reasonable, a developer could copyright the "look"
of his programs.60 The problem with this is analogous to a
cookbook: if a competitor can organize his chapters in
another fashion, then a cookbook author may copyright the
"appetizers, main dishes, desserts" order of presentation.61
Possible Solutions
__________________
Peter S. Menell suggests that the courts should require
defendants in "look and feel" infringement lawsuits to show
that their inclusion of the plaintiff's "ideas" was for the
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purpose of developing the most efficient program they could
produce.62 As the software industry progresses, innovative
ideas, such as trash-can deletion, would surface. Copyright
law, protecting only "expression," would not limit the
dissemination of those ideas. The plaintiff, on the other
hand, would have the burden of proving that the "look and
feel" of their program was mostly "expressive" -- that it is
not the most efficient program that could have possibly been
made. One such case developed when a plaintiff proved that
the defendant had gone so far as to copy an error in his
program.63 If this sounds unreasonable, consider that the
standards for good programming techniques are beginning to
include lists of user-friendly techniques normally
considered "look and feel" functions by their original
authors.64 An example of this might be using a function
key, a key that calls up a computer process when pressed,
instead of having to type out the name of the function
desired. This method of judgment would protect against
verbatim copying and promote research into more efficient
programming which would build upon previously successful
programs.65
A second alternative is to allow all "look and feel"
copying and restrict verbatim copying for a ten year period
while allowing reverse-engineering in the interim.66 This
is a software version of the Semiconductor Chip Protection
Act of 1984.67 Intel corporation, whose 8088 microprocessor
chip was reverse-engineered by NEC corporation, is pleased
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by this as their future generation microprocessors will be
nearly impossible to copy by reverse-engineering due to
their complexity.68 It is argued that the software
developer will have sufficient lead-time in the marketplace
to reap the rewards of his innovation before the competitors
catch up or the program becomes verbatim copiable.69
Additional benefits for being first include name recognition
and long term contract establishment -- especially with
regard to larger systems such as mainframe computers.70
This method would be more in accord with the original intent
of the legal protection system: to promote innovation and
progress.
The third alternative is to give a strict
interpretation of copyright law, which would only protect
verbatim copying, and allow limited-duration patents,
perhaps as short as five years, on "idea" innovations.
Already this is occurring to a limited extent as software
developers begin to seek the additional protection of
patents as more and more courts begin to hand down judgments
in favor of the infringement defendants.71 The high
standards of a granted patent mandate that all but the most
novel innovations will be refused -- thus allowing the
dissemination of most "look and feel" creations and barring
blanket copyrighting in an effort to lock-up the market.
Additionally, those developers who do get the limited-
duration patents for their ideas will be recompensated for
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the extraordinary research and development costs of
producing something "novel".
Software copyright law has created considerable
controversy since its beginnings. While there is a need to
disseminate the "utilitarian" value of programs, the
software developer must maintain a profit motive to produce.
Courts have stretched the copyright law with their
interpretations in order to seek a viable balance. The
solution is a strict interpretation of copyright law
combined with a special law regarding the "look and feel"
rights of a computer program.
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Notes
1 United States Copyright Office, Copyright Law of the
____________________
United States of America (March 1989) 7.
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2 "Software Protection in the EEC," California Law
______________
Review March 1987: 641.
______
3 Ca. L. R., 643.
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4 Kathleen K. Wiegner and John Heins, "Can Las Vegas
sue Atlantic City?" Forbes March 6, 1989: 137.
______
5 Wiegner, 130.
6 ibid.
7 Peter S. Menell, "An Analysis of the Scope of
Copyright Protection for Application Programs," Stanford Law
____________
Review (Stanford, May 1989), 1067.
______
8 ibid.
9 Weigner, 131.
10 Menell, 1067.
11 "Don't use copyright to shackle software," Business
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Week March 29, 1989: 122.
____
12 Menell, 1085.
13 Keith Hammonds, "Don't bury software's promise in a
legal bog," Business Week May 22, 1989: 86.
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14 Weigner, 136.
15 Weigner, 132.
16 Menell, 1067.
17 Weigner, 132.
18 Hammonds, 86.
19 Menell, 1047.
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20 John C. Dvorak and Jim Seymour, "Copyright
protection: help or hindrance?" PC/Computing May 1989: 30.
____________
21 Weigner, 136.
22 Dvorak, 30.
23 Weigner, 130.
24 Weigner, 136.
25 Weigner, 130.
26 Weigner, 136.
27 Menell, 1070.
28 Dvorak, 29.
29 Victor Rosenberg, "Software Theft and Copy
Protection," Library Journal February 1, 1989: 46.
_______________
30 Philip Elmer-DeWitt, "A Victory for the Pirates?"
Time October 20, 1986: 86.
____
31 ibid.
32 U.S. Copyr. Off., Copyr. Law, 39.
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33 Rosenberg, 46.
34 Elmer-DeWitt, 86.
35 Dvorak, 29.
36 West's Federal Practice Digest, 3d ed., Vol. 21,
______________________________
(St. Paul, Minnesota: West Publishing Co., 1984) 10.4.
37 Ca. L. R., 643.
________
38 Menell, 1078.
39 Ca. L. R., 643.
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40 Weigner, 133.
41 Menell, 1046.
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42 United States Copyright Office, Copyright
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Registration for Computer Programs, October 1989.
__________________________________
43 ibid.
44 West's Federal Practice Digest, 3d and 4th,
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February 1990 (St. Paul, Minnesota: West Pub. Co.) 423.
45 Weigner, 133.
46 Ca. L. R., 643.
_________
47 U.S. Copyr. Off., Copyr. Law, 7-8.
__________
48 Ca. L. R., 645.
_________
49 Menell, 1049.
50 Weigner, 133.
51 Ca. L. R., 644.
_________
52 ibid.
53 Weigner, 133.
54 Menell, 1049.
55 West's Feb. '90, 422.
______
56 Menell, 1074.
57 West's Feb. '90, 425-6.
______
58 West's 3d, 10.4.
______
59 West's Feb. '90, 308.
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60 ibid., 422.
61 Menell, 1084.
62 Menell, 1088.
63 Menell, 1087.
64 Menell, 1082.
65 Menell, 1088.
66 Weigner, 137.
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67 Menell, 1078.
68 Barinaga, Marcia, "Computer microcode instructions
judged within copyright," Nature 16 February 1989: 591.
______
69 Business Week, 122.
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70 Menell, 1060.
71 Hammonds, 86.