Source: http://ifosslawbook.org/united-states-of-america/
Timestamp: 2019-04-19 03:14:48+00:00

Document:
Rights in software in the United States arise from a mixture of federal and state law and the interpretation of those laws by the various courts. Software may be protected by a combination of copyright, patent, trademark, and trade secret law. Further, the licensing of rights in software is subject to contract law, bankruptcy law, antitrust (competition) law, uniform state laws, tax law, export control law, and other specialized federal and state statues.
Copyright and patent protection of software arises under Section 8, Article 1 of the U.S. Constitution.2 The Copyright Act is embodied in Title 17 of the U.S. Code, the statutes that implement the Constitutional directive.3 The Patent Act is embodied in Title 35 of the U.S. Code.4 Both copyright and patent law fall within the exclusive jurisdiction of the U.S. Federal government.
To the extent the publisher of software claims a trademark applicable to that software, such trademark rights may arise under federal trademark law, state trademark law, or common law rights in trademarks. Federal trademark law is embodied in the Lanham Act, Title 15, Chapter 22 of the U.S. Code.5 State trademark law is generally embodied in state statutes of the various states. In the U.S. rights in a trademark may arise under common law from mere usage.
Of the remaining areas of law that may govern a software license, none is more important than contract law. Contract law in the U.S. is largely within the purview of state law, and U.S. courts give contracting parties a great deal of deference in determining the contractual terms that will govern their relationship. As a consequence, parties may, within limits, contract away rights and/or protections otherwise granted under copyright, patent, trademark or trade secret law.
Section 102 of the U.S. Copyright Act (the “Act”) provides copyright protection for “original works of authorship fixed in any tangible medium of expression.”14 Nothing more is required. Thus, whatever ownership interests exist in the copyright commences with the reduction of the expression to some tangible medium, whether paper or an electronic file.
Section 201(a) of the Act provides that copyright protection in a work “vests initially in the author or authors of the work.”15 In the case of a sole developer, copyright in the software code will vest with her as the sole owner upon fixation of the code in a tangible medium of expression. That is, once she types and saves the code, fixing it in the computer’s memory, she now owns the copyright in that code. Nothing more is required of the developer to own the copyright.
In the case of a developer writing software code within the scope of her employment, the resulting work is known as a “work made for hire.” With a work made for hire, “the employer or other person for whom the work was prepared is considered the author for purposes of [the Act],” and the owner of the copyright in the work.16 The developer and her employer may agree otherwise, where ownership remains with the developer, through an express agreement in a written instrument signed by both parties.17 The intention of the developer and her employer, expressed before the code is written, will dictate who owns the copyright in the resulting work.
So long as the intent to create a joint work exists prior to the commencement of work, it is even possible for joint authorship to occur “even though the joint authors do not work together in their common design, do not make their respective contributions during the same period, and indeed even if they are complete strangers to each other.”27 This situation is common among developers working independently in developing software modules that are to be included in a unified open-source project. The intent and timing of these developers will dictate who owns the copyright in the resulting work.
The joint authors are the co-owners of a single copyright in the joint work.28 However, joint authorship is not the only means by which joint ownership of a work may arise.
Finally, the Act protects interests in compilations, including collective works.39 A compilation is “a work formed by the collection and assembling of preexisting materials or of data that are selected, coordinated, or arranged in such a way that the resulting work as a whole constitutes an original work of authorship.”40 The preexisting materials or data incorporated in a compilation may or may not, on their own, be capable of being protected by copyright.41 For example, a program created by stringing together a set of basic functions (which in themselves are not protected by copyright) may receive copyright protection in the selection, coordination, and arrangement of such basic functions.
Those compilations that do, however, incorporate preexisting material capable of receiving copyright protection are known as collective works.42 The Act defines a collective work as “a work, such as a periodical issue, anthology, or encyclopedia, in which a number of contributions, constituting separate and independent works in themselves, are assembled into a collective whole.”43 For example, a program that includes preexisting modules (which in themselves protected by copyright) may receive copyright protection in the selection, coordination, and arrangement of the modules.
Functional elements may also be dictated by the nature of the program being developed. In Computer Associates, “the district court found that the overlap exhibited between the list of services required for both ADAPTER and OSCAR 3.5 was determined by the demands of the operating system and of the applications program to which it was to be linked through ADAPTER or OSCAR.”59 These aspects of the program’s structure are therefore functional in nature and not copyrightable.
Applied to computer programs, the merger and scènes à faire doctrines suggest that if a limited number of options exist to achieve a given function efficiently, interoperate with another application, or run in a given environment, copyright will not permit exclusive control over those program elements.89 Scènes à faire is distinguishable from the merger doctrine because, the merger doctrine holds that when there are so few ways of expressing an idea, not even the expression is protected by copyright.90 The idea and expression are in essence, fused. In contrast, scènes à faire relates to alleged similarities that follow obviously from the unprotected idea.91 The focus in scènes à faire is not on the merged idea and expression or the limited number of ways to express the idea, but on the similarities between expression in question which are a natural result of the idea being expressed.
Moreover, scènes à faire is also distinguishable from the functionality exception to copyright protection. While scènes à faire is expression that relates to stock scenes or elements which are necessary to the idea such as frequently asked questions or readme files, functionality relates to aspects of a program’s structure which are dictated by the nature of other programs with which they were designed to interact,92 such as hardware or software standards. As software development languages become more and more sophisticated in the ready-made tools they provide developers and as more and more developers, especially open source developers, reuse standard or stock bits of code to carry out standard functions, we will see the scènes à faire doctrine applied with greater regularity in software to deny copyright protection.
“In no case does copyright protection for an original work of authorship extend to any … discovery, regardless of the form in which it is described, explained, illustrated, or embodied in such work.”103 Nimmer explains that the discoverer merely finds and records.
Originally developed by the courts through caselaw, certain uses or reproductions of a work protected by copyright are considered to be fair, and thus, not an infringement of the owner’s exclusive rights granted by copyright law.110 In other words, fair use is a defense to copyright infringement.
Unlike the copyright laws of many European nations, the United States does not generally recognize moral rights in copyrighted works. The exception lies with works of visual arts, such as posters, maps, globes, motion pictures, electronic publications, and applied art.115 As a consequence, the ability to assert moral rights under copyright in computer programs would be rare.
In the United States the duration of copyright in computer programs is dependent on the nature of the authorship. Where the computer program was written by a single author on or after January 1, 1978, the copyright expires 70 years following the death of the author.116 If a work was created by joint authors, the 70-year period is calculated from the date of the death of the last surviving author.117 Where the computer program was written anonymously, under a pseudonym, or as a work made for hire, the copyright endures for a term of 95 years from the year of its first publication, or a term of 120 years from the year of its creation, whichever expires first. Should the author or his/her legal successor record his/her identity with the U.S. Copyright Office prior to the date of expiration, the copyright term is calculated under the general rules for known authors.118 As to derivative works, compilations or collective works, there is no special rule as both the author of the preexisting works (if any) and the author of the derivative work, compilation or collective work hold independent copyrights. Thus, each protection term is calculated separately under the general rule.
Apart from the right to bring an action for infringement, licensor’s of software may also bring an action for breach of contract where the subject matter of the breach does not relate to rights granted under copyright. As examples, the failure to pay license fees in a timely manner, royalty rates, and a breach of warranty all constitute contract claims. Unlike an action for copyright infringement, in a breach of contract action only money damages are generally available and not injunctive relief. A general exception to this rule would be in an action for specific performance under the contract. Most importantly, unlike copyright infringement where injunctive relief is a matter of right, injunctive relief will only be granted in breach of contract actions where such breach would result in irreparable harm that could not be adequately remedied by money damages.
Unlike copyright, patent protection of software is not automatic, and such protection is largely limited to the jurisdiction issuing the patent. Whether inventions contained in software constitute patentable subject matter has been the subject of a great deal of debate and evolving law in the U.S. Prior to the 1980’s it was generally believed that one could not obtain a patent on inventions embodied in software, as such software consisted primarily of algorithms and, by law, algorithms were deemed unpatentable subject matter. This view first changed in 1981 in the Diamond v. Diehr case when the U.S. Supreme Court held that the use of an algorithm in software does not preclude it as patentable subject matter so long as the claimed invention related solely to the use of the software to solve a specific technological problem and did not preclude all other uses of the algorithm.137 While interpretations of patent eligibility of software inventions have continued to evolve, the U.S. Supreme Court in the case of In re Bilski138 held that the machine or transformation test previously adopted by the U.S. Court of Appeals for the Federal Circuit, i.e., “[a] claimed process is surely patent-eligible under § 101 if: (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing,” constituted a test, although not the sole test, of whether a process is patent eligible.139 In any case, inventions embodied in software remain largely patent eligible in the U.S.
A scope of a patent is defined by the claims asserted in the patent. In patents related to software such claims generally define the broad outline of the invention in terms of a process. Thus, the claims are not limited to a particular embodiment of that process (or, like copyright, to a specific set of written instructions) but may apply to an unlimited number of embodiments so long as each embodiment incorporates each element of one of the claims asserted in the patent. As a consequence, patents related to software may be infringed by numerous computer programs, and any computer program may infringe the claims of numerous patents.
A patent holder in the U.S. has the exclusive right to make, have made, use, sell, or import any product made by means of a claimed process or product embodying the claimed invention.140 As with copyright, these rights may be assigned or licensed to another either in whole or in part.
Adams v. Burke141 – claims that are directly infringed by the product are exhausted at the time of sale.
Univis Lens142 – implied license in claims necessary to finish an incomplete product.
Intel v. ULSI143 – implied license accompanies the sale of infringing goods by a licensed manufacturer.
Cyrix v. Intel144 – implied license in claims necessary to make a complete product commercially viable (use for intended purpose).
In addition to these cases specifically related to patent claims, licenses may be implied by courts for a variety of other legal and equitable reasons. For example, the conduct of the two parties may be construed as establishing a license. Also, equitable estoppel may be found where a party knowingly infringes and the patent holder, knowing of the infringement and objecting to such infringement, takes no action to halt the infringement, misleading the infringer into believing the patent holder will not act. Finally, a court may impose legal estoppel on a patent holder who has licensed or assigned a right, received consideration, and then sought to derogate from the right granted.
Patent protection in the U.S. is granted for a term of 20 years measured from the date of the filing of the patent application for all patents issued on or after June 9, 1995.145 For patents issued prior to that date the term is the longer of 20 years from the date of filing or 17 years from the date of issue; this transition term phasing out on June 9, 2012.
Sec. 271(f) of the Patent Act146 extends infringement liability to any party who “without authority supplies or causes to be supplied in or from the United States all or a substantial portion of the components of a patented invention, where such components are uncombined in whole or in part, in such manner as to actively induce the combination of such components outside of the United States in a manner that would infringe the patent if such combination occurred within the United States.” This provision had been read to imply that the making outside the U.S. of copies from of an infringing gold master provided by a U.S. software developer would constitute additional infringing acts increasing the liability of the U.S. developer. In the case of AT&T v. Microsoft147 the Supreme Court held that so long as the copies were made outside the U.S. from a gold master provided from the U.S. no liability accrued where the infringing act arises from the actual loading of the software onto a computer or the operation of the software on that computer.
Under principles of contract law parties may agree to limit the scope of liability that may be imposed on a party under a license agreement, and such limitations are generally held to be valid.
Although there are numerous other laws that are applicable to the licensing of software, we only make mention of one here – export control. U.S. law prohibits the exporting of software incorporating cryptographic code except under a license issued by the Bureau of Industry and Security.156 Obligations and liability under the statute extend beyond the original distributor to any downstream party that redistributes the software. As a consequence, most original distributors include in their license a notice of such obligations and liability.
Rights in FOSS under copyright, patent, and trademark law and the enforcement of such rights does not differ from other forms of licensing. The principle question to be addressed in each instance, particularly with respect to the exercise of rights granted under the FOSS license is whether any of such rights are subject to conditions. Absent such conditions applicable to the exercise of the right in question, such FOSS licenses will be interpreted exclusively under principles of contract law, and as a consequence, injunctive relief (the most valuable tool available to a FOSS licensor) is likely to be unavailable. Consequently, when considering the selection and enforcement of a FOSS license, the licensor will want to give due consideration as to whether a court would likely find a condition limiting the exercise of such right (e.g., the obligations imposed by the GNU General Public License (GPL) on any party distributing code licensed under the GPL) or no such condition (e.g., arguably the Berkeley Software Distribution (BSD) and MIT licenses impose no such conditions).
A more detailed discussion of license laws and principles applicable to FOSS will be provided in the future.
There have been few cases in the U.S. that have addressed the enforcement of free and open source licenses. Many of the so-called free and open source cases have dealt primarily with trademark issues.
Jacobsen v. Katzer157 is undoubtedly the most important of the cases addressing free and open source software in the U.S. At issue was the provision of the Artistic license that requires licensees to include both copyright notices and a tracking of modifications in derivative works.
Although the Jacobsen case later settled, this Federal Circuit ruling clearly established the enforceability of free and open source licenses containing at least one condition limiting a licensee’s right to exercise one or more rights granted under a copyright license.
1Visiting Professor, New York Law School, http://www.nyls.edu/faculty/faculty_profiles/mark_webbink. The author would also like to acknowledge the significant contributions of two of his students, Omar Johnny and Marc Miller. Material portions of this article were taken from the paper written by these authors and published in the International Free and Open Source Law Review at: http://www.ifosslr.org/ifosslr/article/view/30.
317 U.S. Code may be found at http://www.law.cornell.edu/uscode/html/uscode17/usc_sup_01_17.html.
435 U.S. Code may be found at http://www.law.cornell.edu/uscode/html/uscode35/usc_sup_01_35.html.
515 U.S. Code Chapter 22 may be found at http://www.law.cornell.edu/uscode/15/usc_sup_01_15_10_22.html.
6For example, the Uniform Trade Secrets Act as embodied in California state law may be found at http://www.leginfo.ca.gov/cgi-bin/displaycode?section=civ&group=03001-04000&file=3426-3426.11.
7The Economic Espionage Act of 1996 found at 18 U.S. Code §§1831-1839, http://www.law.cornell.edu/uscode/18/1831.html.
8World Intellectual Property Copyright Treaty of 1996 found at http://www.wipo.int/treaties/en/ip/wct/trtdocs_wo033.html#P45_2379.
9The final report of the National Commission on New Technological Uses of Copyrighted Works found at http://digital-law-online.info/CONTU/contu1.html.
10The U.S. Copyright Act of 1976 found at http://en.wikisource.org/wiki/Copyright_Act_of_1976.
11Public Law 96-517 found at http://law.copyrightdata.com/amendments.php.
221-6 Melville B. Nimmer, Nimmer on Copyright §6.03. Nimmer is only available in hard copy from LexisNexis or in electronic form from either the LexisNexis or Westlaw legal research services. Nimmer is widely considered the authoritative treatise on U.S. copyright law.
36Lothar Determan, Dangerous Liaisons – Software Combinations as Derivative Works? Distribution, Installation, and Execution of Linked Programs Under Copyright Law, Commercial Licenses, and the GPL, 21 Berkeley Tech. L. J. 1421, 1430 (2006).
441-3 Nimmer § 3.03[A] (citing Feist Publications, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340, 348, 111 S. Ct. 1282, 113 L. Ed. 2d 358 (1991); Siegel v. Time Warner Inc., 496 F. Supp. 2d 1111, 1151 (C.D. Cal. 2007); Sherry Mfg. Co. v. Towel King of Fla., Inc., 753 F.2d 1565 (11th Cir. 1985); Montgomery v. Noga, 168 F.3d 1282, 1290 n.12 (11th Cir. 1999); Moore Pub., Inc. v. Big Sky Mktg., Inc., 756 F. Supp. 1371, 1374, 1378 (D. Idaho 1990)).
56Computer Assoc., 982 F.2d at 714.
58See, Computer Assoc., 982 F.2d at 715.
60Apple Computer, Inc v. Microsoft Corp., 35 F.3d 1435, 1445 (9th Cir. 1994).
61See, Lotus Dev. Corp. v. Borland Int’l,, 49 F.3d 807, 819 (1st Cir. 1995).
68Whelp Assoc., Inc. v. Jaslow Dental Lab, Inc., 797 F.2d 1222, 1236 (3rd Cir. 1986).
69Computer Assoc., 982 F.2d at 708.
71See, BUC Int’l Corp. v. Int’l Yacht Council Ltd., 489 F.3d 1129, 1143 (11th Cir. 2007).
76See, Computer Assoc., 982 F.2d at 715.
77See, Computer Assoc., 982 F.2d at 715.
82See, John William See v. Christopher Durang and LA. Stage Co., 711 F.2d 141, 143 (9th Cir. 1983).
85Mist-On Sys. v. Gilley’s European Tan Spa, 303 F. Supp. 2d 974, 978 (W.D. Wis. 2002).
87Mist-On Sys., 303 F. Supp. 2d at 976 (W.D. Wis. 2002).
89Computer Assocs., 982 F.2d at 709-10.
90BUC Int’l Corp. v. Int’l Yacht Council Ltd., 489 F.3d 1129, 1143 (11th Cir. 2007).
91See v. Durang, 711 F.2d at 143.
92Computer Assoc., 982 F.2d at 715.
97See, Computer Assocs., 982 F.2d at 710.
102Feist Publ’ns, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340, 350-351 (1991).
105Feist, 499 U.S. at 350 (1991).
107Assessment Techs. of WI, LLC v. WIREdata, Inc., 350 F.3d 640 (7th Cir. 2003).
Visual Artists Rights Act of 1990, 17 U.S. Code §106A.
Eden Toys, 697 F.2d at 32 (1982).
Wooster v. Crane & Co., 147 F. 15 (8th Cir. 1906).
In re Bilski, 130 S. Ct. 3218 (2010).
In re Bilski, 130 S. Ct. at 3226 (2010).
United States v. Univis lens, 316 U.S. 241 (1942).
Intel Corp. v. ULSI System Technology, 995 F.2d 1566 (Fed. Cir. 1993).
Cyrix Corp. v. Intel Corp., 77 F.3d 1381 (Fed. Cir. 1996).
AT&T v. Microsoft, 550 U.S. 437 (2007).
Microsoft v. I4I, cert granted, (U.S. Nov. 29, 2010)(No. 10-290).
Magnuson-Moss, 15 U.S.C. §2301 et seq..
15 Code of Federal Regulations §742.15.
Jacobsen v. Katzer, 535 F.3d 1373 (Fed. Cir. 2008).
3-10 Nimmer on Copyright §10.15 .
Jacobsen, 535 F.3d at 1381 (2008).
Wallace v. International Business Machines Corp., 467 F.3d 1104 (CA 7 2006).
Wallace, 467 F.3d at 1107 (2006).

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