Lexmark, Watermarks, Skylink and Marketplaces: Misuse and Misperception of the Digital Millenium Copyright Act's Anticircumvention Provision

The Digital Millennium Copyright Act was not intended to curb circumvention for purposes of reverse-engineering that leads to technical interoperability. As an Act meant to mend some of the awkward bridges between an analog culture and a digital culture, the Digital Millennium Copyright Act has been shown to contain some ambiguous language that courts have interpreted inconsistently. Recent case law demonstrates opposite conclusions regarding reverse-engineering for purposes of attaining interoperability; the correct interpretation continues to allow for it, just as traditional copyright law would The Digital Millennium Copyright Act [hereinafter "DMCA"] provides that "no person shall circumvent a technological measure that effectively controls access to a work protected under this title."1 According to Congress, the DMCA was designed "to facilitate the robust development and world-wide expansion of electronic commerce, communications, research, development, and education in the digital age." 2 Furthermore, the DMCA was meant to "provide certainty for copyright owners and Internet service providers with respect to copyright infringement liability online." 3 The DMCA is necessary in an age when material can be illegally copied and distributed over the Internet without the need for technological expertise. However, when the DMCA is 1 The Digital Millennium Copyright Act, 17 U.S.C. § 1201. 2 Mr. Hatch, from the Committee on the Judiciary, 10 5 h Congress Report, Senate 2d session, May 11, 1998. 3 Id. improperly applied and traditional copyright law is trumped by excising the fair use provision, the DMCA adversely effects technological innovation. 4 The "work" referred to in the DMCA is simply something that can be copyrighted under the original Copyright Act. However, regardless of the form or format in which it is described or explained, copyright protection for an original work of authorship never extends to an idea, procedure, process, system, method of operation, concept, principle, or discovery. 5 The Copyright Act includes a subset of subject matter referred to as "literary works," such as computer programs in object or source code. 6 The DMCA provides for a ban related to use controls in § 1201(b)(1), which has been described as "a deliberate attempt by Congress to allow for fair use."7 If this were not Congress' intent, when an underlying act of copying is lawful--such as when there is a fair use--a prohibition on the act of circumventing a use control would functionally prohibit the permissible use. 8 The DMCA is an improper conduit through which the marketplace of digital technologies is altered. The reverse-engineering provision in the DMCA, section 1201(f), is an exception that "permits circumvention, and the development of 4 Calling on Congress to Amend the Digital Millennium Copyright Act andImprove Trade with Chile, Singapore and Other Trading Partners, quoting Rep. Boucher, available at http://www.house.gov/boucher/docs/lofgren.htm (last visited Feb. 28, 2004). 5 17 U.S.C. § 102(b). 6 Apple Computer, Inc. v. Franklin Computer Corp., 714 F.2d 1240, 1249 (3d Cir. 1983). 7 Robert P. Taylor and Ethan B. Andelman, Anticircumvention under the DMCA: Where Do We Stand After Five Years?, The Computer & Internet Lawyer, Vol. 21, No. 3, March 2004, at 2, citing U.S. v. Elcom, Ltd., 203 F. Supp. 2d 1111, 1120 (N.D. Cal. 2000) 8 R. Anthony Reese, Will MergingAccess Controls andRights Controls Undermine the Structure of Anticircumvention Law?, 18 BERKELEY TECH L. J. 619, 647 352 (2003). technological means for such circumvention, by a person who has lawfully obtained a right to use a copy of a computer program for the sole purpose of identifying and analyzing elements of the program necessary to achieve interoperability with other programs .... ,9 There is no provision in the DMCA that provides new rules for the digital marketplace; circumvention is still permissible. Given this fundamental notion, and coupled with this skeletal framework for copyright law, this writing will critique the recent case Lexmark International, Inc., v. Static Control Components, Inc.,l0 which unjustifiably chilled marketplace competition when the court held that the defendant's copying of the plaintiffs' programs did not constitute fair use. The Lexmark case will then be related to legislative materials and compared with other recent literature. With those materials as a backdrop, new formats for digital rights management will be examined, and their legitimacy will be discussed through a filter of economic reasoning. Finally, it will be shown that the decision in Chamberlain Group v. Skylink Technologies" better interprets the pith of the DMCA than does the Lexmark case. I. The Lexmark Case Lexmark, Inc. [hereinafter "Lexmark"] produces, inter alia, laser printers and toner cartridges. Lexmark manufactures two different kinds of cartridges, an expensive version that works interchangeably with other toner brands and a less-expensive version 9U.S. Copyright Office Summary of the Digital Millennium Copyright Act of 1998, at 5. 10 253 F. Supp. 2d 943 (E.D. Ky. 2003). "1292 F. Supp. 2d 1040 (N.D. I11. 2003). that must be sent back to Lexmark upon its expiry for replacement.12 This latter version is equipped with a computer code on a microchip that prevents other brands of toner from being compatible with the cartridge. Static Control Components, Inc. [hereinafter "Static"] is a company that manufactures and sells, inter alia, components for remanufactured toner cartridges, including the "Smartek" chip. The Smartek chip enabled Lexmark customers to forego purchasing a new box of Lexmark toner for the less-expensive cartridge. 13 Lexmark filed a complaint in December of 2002, asserting that the "Smartek" chip manufactured by Static infringed Lexmark's DMCA copyright protection in its Toner Loading Program. The program involves a sequence of technological communications that authenticate a toner after determining whether the toner is compatible with the Lexmark hardware. Static "acknowledge[d] that it specifically designed its Smartek microchip to circumvent Lexmark's authentication sequence."' 14 Static argued that the purpose of the DMCA was to prevent software piracy, and not to affect efforts to make different companies' hardware compatible, i.e., interoperable, with each other. In March of 2003, the Lexmark court disagreed with Static's argument, finding that Static's activity was "wholesale, identical copying of Lexmark's Toner Loading Programs for commercial exploitation and profit."' 15 However, the Lexmark court did not adequately incorporate the reasoning from the 1992 Ninth Circuit case 12 Jesse Walker, Static Controls: Copyrights and Printer Cartridges, ASAP, Gale Group, Oct. 1, 2003. 13 Lexmark v. Static Control, supra note 10, at 946.