Opinion ID: 659340
Heading Depth: 2
Heading Rank: 1

Heading: Copyright Issues

Text: 11 Concluding that LSI's MPO program infringed K-T's Licensed Materials, the district court awarded K-T damages and enjoined LSI from further copying, producing, distributing, and/or selling the MPO program. The court also concluded that a modified version of the MPO program infringed K-T's Licensed Materials. This modified MPO program resulted from LSI's efforts to remove all infringing language from the original MPO program. The injunction covers this modified program too. Finally, the court enjoined all future modifications and improvements of the MPO program. For clarity, these programs--(1) the MPO program, (2) the modified MPO program, and (3) all future modifications of the MPO program, are discussed separately.
12 The district court concluded that LSI's MPO program infringed K-T's Licensed Materials. To reach that conclusion, the court had to find that (1) K-T owned a valid copyright over the Licensed Materials, (2) LSI copied portions of the Licensed Materials when it made the MPO program, and (3) among the portions copied were substantial protectable elements of the Licensed Materials. 2 LSI does not contest that K-T's Licensed Materials are covered by a valid copyright. Indeed, Vroom--a 50% partner in LSI--applied to register the V-Y Model materials that were subsequently licensed to K-T, evidently reflecting his belief that those materials were the proper subject of copyright protection. 3 Rather, LSI insists that (1) K-T failed to prove that LSI had actually copied K-T's licensed materials, and (2) the court erred in extending copyright protection to inherently unprotectable elements of K-T's materials. 13
14 LSI argues that the district court erred in finding that it had actually copied K-T's Licensed Materials, rather than copying other materials--possessed by third parties--that contained the same information. We find this argument to be without merit. 15 As direct evidence of copying is uncommon, plaintiffs generally demonstrate copyright infringement indirectly or inferentially by proving that (1) defendants had access to the copyrighted works, and (2) there is a substantial similarity between infringed and infringing works. 4 These copyright issues of access and substantial similarity are findings of fact and are consequently reviewed under the clearly erroneous standard. 5 In this case, the district court found that both Vroom and Jago had access to the Licensed Materials. As Vroom helped develop and write those materials, and as Jago relied on them in developing the MPO program, that finding is not clearly erroneous. Indeed, it is factually correct. 16 LSI, however, insists that K-T never demonstrated that LSI literally copied the specific materials that were licensed to K-T. But LSI's dogged insistence is nonsensical. Even if LSI did lift the offending expression from third party sources, its reproduction of that expression for commercial purposes may be infringing. Language copied from those third party sources was itself copied or derived from K-T's Licensed Materials, and its legality depends on copyright law. In other words, even if LSI copied a copy of K-T's Licensed Materials, such copying may still constitute infringement. Copying a copy of copyrighted materials is a cognizable contravention of the Copyright Code. 6 17 LSI does not dispute that there is substantial similarity between the MPO program and K-T's Licensed Materials. Indeed, LSI admits that the MPO program incorporates the same eight questions and five processes that the district court characterized as the heart and soul of the V-Y Model, which was licensed to K-T. Thus, the district court's finding that MPO is substantially similar to K-T's Licensed Materials is not clearly erroneous. In summary, neither the district court's finding that LSI had access to K-T's Licensed Materials, nor its finding that MPO program was substantially similar to those materials is clearly erroneous. Consequently, the district court's finding that LSI copied K-T's Licensed Materials is not clearly erroneous. 18
Copyrighted Materials 19 LSI argues nonetheless that the portions of K-T's licensed materials that it allegedly copied are but unprotectable ideas or facts, and that the district court therefore erred in holding that LSI infringed K-T's copyright. LSI is correct that the mere fact that K-T's Licensed Materials are copyrighted does not mean that all aspects of those materials are automatically protected. 7 Specifically, LSI rightly observes that copyright law protects tangible, original expressions of ideas, not ideas themselves. 8 [N]o author may copyright facts or ideas. The copyright is limited to those aspects of the work--termed 'expression'--that display the stamp of the author's originality. 9 Thus, if we conclude that LSI only copied unprotectable elements of K-T's materials, we must reverse the district court's judgment. 20 Unfortunately, the line between idea and expression is hard to draw. Additionally, when an idea can be expressed in very few ways, copyright law does not protect that expression, because doing so would confer a de facto monopoly over the idea. In such cases idea and expression are said to be merged. 10 To determine the scope of copyright protection in a close case, a court may have to filter out ideas, processes, facts, idea/expression mergers, and other unprotectable elements of plaintiff's copyrighted materials to ascertain whether the defendant infringed protectable elements of those materials. In this case, however, we disagree with LSI's contention that such a filtration process leads to the conclusion that the district court erred in finding that LSI's MPO program infringed K-T's Licensed Materials. 21 Although there is no evidence that the district court undertook a rigorous abstraction-filtration-comparison analysis of the sort approved by courts for sophisticated treatment of copyright cases, 11 such an analysis was not absolutely necessary here. The district court carefully juxtaposed selections from K-T's Licensed Materials with selections from the MPO program, thereby demonstrating a damning similarity--nay identity--of organization and language. This comparison of literal language or expression provided strong evidence for the court's finding that the MPO program infringed K-T's Licensed Materials. 22 Seizing upon the court's statement that the questions and processes of the Vroom-Yetton model are its heart and soul, LSI argues that these elements are inherent in the leadership management theory ... of the Vroom models, implying that questions and processes that comprise the V-Y Model are unprotectable ideas. LSI contends that there is no protectable expression remaining in K-T's licensed materials, once all unprotectable elements are filtered out. But this is absurd. 23 Each question and process in the V-Y Model is presented in a paragraph of text. There are countless ways of expressing the content of each paragraph, 12 so there was no need for the MPO screen text to copy exactly the language of K-T's materials. Even if each of the eight questions and five processes conveys unprotectable ideas, the specific words, phrases, and sentences selected to convey those ideas are protectable expression under any reasonable abstraction analysis. As LSI's MPO program copied those words, phrases, and sentences verbatim, we conclude that--far from being clearly erroneous--the district court's finding that the MPO program infringed K-T's Licensed Materials was correct and must be affirmed. 13
24 The district court also concluded that LSI's modified MPO program infringed K-T's Licensed Materials. As noted above, the modified MPO program was the end result of LSI's surgical efforts to remove only the infringing language from the original MPO program. As this effort was partially successful, we cannot affirm the district court's conclusion that the modified MPO program infringes K-T's copyright merely by making a cursory comparison of the modified MPO program's language with that of K-T's materials. 25 As with the original MPO program, there is no doubt that LSI copied K-T's materials in creating its modified MPO program. As noted above, evidence of LSI access to K-T's materials and the substantial similarity of the original MPO program overwhelmingly suggest copying. The same is true for the modified MPO program, which is just a post factum rearrangement of the original MPO program, itself a wholesale plagiarism of the definitions and processes that were licensed to K-T. Our finding of copying does not, however, lead automatically to the conclusion of infringement: the question remains whether LSI's modified MPO program copied any protectable elements of K-T's Licensed Materials. 14 We conclude that it did. 26 The main purpose or function of K-T's Licensed Materials is to teach managers how to analyze their own decision making, and how to make the best decision in each decision-making context. Clearly this basic idea of a management training program is unprotectable. 15 Likewise unprotectable is the more specific idea of training managers by asking them a series of questions about their decision-making landscape, and then--based on their answers--suggesting a preferred decision-making process. 27 At the other end of the abstraction spectrum, the specific words, phrases, and sentences used to formulate the questions and processes clearly constitute protected expression. 16 But the intermediate levels of abstraction, consisting of such factors as the structure, sequence, and organization of a copyrighted work, are more problematic: courts' judgments about the protectability vel non of such elements are inevitably ad hoc and fact specific. 17 In this case, we conclude that the modified MPO program copied substantial protectable elements of K-T's Licensed Materials and thus infringed K-T's copyright. 28 Like the district court, we are unimpressed by LSI's shallow efforts to remove infringing language from the MPO program. Although it is true that the modified MPO program does not identically trace the language of the definitions and processes contained in K-T's Licensed Materials (as did the original MPO program), the modified MPO program's language is still substantially similar to that of K-T's materials. True, you solve the problem yourself has been replaced with you reach a solution alone. And you consult one-to-one with those that report to you replaces you share the problem with relevant subordinates. But such modifications do not completely dispel the similarity of expression shared by infringed and infringing materials. 29 LSI argues that the modified MPO program is merely substantially similar to unprotectable conceptual elements of K-T's materials, that the modified MPO program communicates the same concepts as K-T's Licensed Materials, but with different expression. We disagree. 30 As an analogy, consider the familiar quote from Romeo and Juliet: O Romeo, Romeo! wherefore art thou Romeo? 18 Reformulating this quote in a manner analogous to LSI's modification of K-T's copyrighted language, we might write: Ah Romeo, Romeo! Why did you have to be born Romeo? Are these two quotes alike only in conceptual substance? Obviously not! Yes, they both express the same concept: why did Juliet have to fall in love with Romeo, scion of Montague--her family's bitterest foe? But they are also quite alike in expression. They are not identical, but they are alike. Both sentences embrace the dramatic repetition of Romeo's name. Both sentences are phrased as questions. Both have the quality of a sigh: the gasping resignation of a woman marvelling at the fateful irony of life. Although the two sentences are not identical, they are manifestly similar in expression, as well as in conceptual content. 31 The language of LSI's modified MPO program is likewise similar to that of K-T's materials: their paragraphs are about the same size, their phrases are similar, their ideas are presented in the same order; in short, parts of the modified MPO program are but a transparent, syntactic rearrangement of portions of K-T's copyrighted materials. While no longer identical to those materials, the modified MPO program still bears many telltale signs of its origins. It is still a copy--still a child of infringement. 32 Additionally, we conclude that the modified MPO program infringes upon elements of K-T's materials, which--although existing at a higher level of organizational abstraction--are nonetheless protectable under copyright law. As we have noted, generalizing about the degree of copyright protection owed to intermediate levels of abstraction, such as the structure, sequence, and organization of copyrighted works, is difficult. A fairly broad consensus has emerged, however, that such non-literal elements of computer programs and other copyrightable works may be protected. 19 Generally speaking, we join that consensus. 20 33 LSI argues that the V-Y Model, which was described in the materials licensed to K-T, amounts to a law of nature like Newton's Law of Gravitation, the constant W (for discussing the geometry of circles and spheres) or Einstein's E = MC 2 . Specifically, LSI contends that the eight definitions and five processes that comprise the V-Y Model are fundamental, ineluctable aspects of a managerial relationship--that intelligent discussion of managerial decision-making is impossible without specific reference to these universal definitions and processes. Although there is a kernel of truth in this assertion, it is a small kernel: in the main, we disagree with LSI's self-aggrandizing characterization of the V-Y Model. 34 Some unprotectable fundamental concepts are undoubtedly buried in the definitions and processes of the V-Y Model. For example, the idea that a manager can make a decision without consulting his subordinates is unprotectable: it is simply one of the relational possibilities that exist between managers and subordinates. As noted above, however, the specific ways that the questions and processes are formulated--the exact words, phrases, and sentences used to describe decision-making processes or questions--are protectable expression. And other, more abstract organizing principles of the V-Y Model are protectable as well. 35 In dissecting the problems of management decision-making into five processes and eight questions, Vroom and Yetton unquestionably originated a useful model of managerial decision-making. Yet, they obviously did not discover the single, unique, unavoidable description of human managerial relations. In creating the MPO program, for example, Jago added four more questions to the eight that were part of the V-Y Model. Such an expansion of the original theory indicates that the first eight questions did not exhaustively and uniquely portray human management relations. 36 Close analysis of the V-Y processes and questions reveals that the ideas they encapsulate can be packaged in different ways. For example, one process (designated AII) instructs a manager to gather information from subordinates, then make the relevant management decision himself. The process states that the manager may or may not tell subordinates the nature of the problem in getting information from them. This makes two separate logical possibilities, so this process could--in a different model--be broken into two different processes. In short, not only does the V-Y Model fail to describe all conceivable features of the management decision-making landscape, it also fails to organize and package its managerial truisms in a single, unique, ineluctable way: there are many ways of organizing those same insights. 37 This point is driven home by examining the way different processes and questions are designated in the V-Y Model. The five processes of that model are designated respectively AI, AII, CI, CII, and GII. How did LSI designate the five processes of its modified--and putatively non-infringing--MPO program? Not surprisingly, AI, AII, CI, CII, and GII. Are these designations fundamental constants supplied by nature, like W for a circle or Planck's constant in quantum physics? Clearly not, they are arbitrarily selected characters: the V-T Model would work just as well if its processes were designated a, b, c, d, and e! These features of the V-Y Model are thus original, protectable expression, not fundamental constants of nature; and LSI's copying of these features--and other related features--is thus technically infringing. 21 38 LSI obviously uses V-Y Model designations in its modified MPO program, and does so intentionally. The V-Y Model has been wildly successful, and the MPO program could benefit from that success by incorporating recognizable, original expression from the V-Y Model, whether that expression is the verbatim formulation of questions and processes, the organization of the model, or the arbitrary designations of the model's constituent parts. But the MPO program is not supposed to benefit from such incorporation. It was precisely the right to benefit from such copying that Vroom and Yetton licensed exclusively to K-T for half a million dollars. 39 LSI attempts to obscure this point by noting that the V-Y Model is reproduced, discussed, and described all over the United States, suggesting that the V-Y Model is in the public domain and thus unprotectable. But protected expression does not lose its protection simply because it is widely disseminated. If the V-Y Model is widely discussed, described, and reproduced, it is presumably with the permission of the copyright holder. Alternatively, it is because such discussion, description, and reproduction constitutes fair use. 22 [F]air use of a copyrighted work ... for purposes such as criticism, comment, new reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright. 23 Conspicuously absent from the list of fair uses is use for commercial purposes, which is exactly the sort of use LSI wants us to approve. 40 When Vroom and Yetton sold K-T an exclusive license to copyrighted materials, which included the V-Y Model, they signed away the right to copy, at least for commercial purposes, protectable elements of the V-Y Model. LSI may not now incorporate substantially similar expression into computer programs for commercial sale: it was precisely the right to make such commercial use of the V-Y Model that Vroom and Yetton sold to K-T for hundreds of thousands of dollars. 41 In summary, we conclude that the district court did not err in holding that the modified MPO program infringed K-T's Licensed Materials. As LSI was partially successful in removing infringing expression from the MPO program, the judgment that the modified MPO program infringes K-T's copyright is a fairly close one. Nonetheless, we agree with the district court that, although the modified MPO program does not identically trace the language of the definitions and processes delineated in K-T's Licensed Materials, it infringes substantial portions of the protected expression contained in those materials. 42
43 We are uncertain whether the district court really intended to enjoin all future modifications of the MPO program, and if so, what it meant by such an injunction. The court's language in its Findings of Fact and Conclusions of Law is certainly broad enough to suggest that it enjoined all future modifications and improvements of the MPO program. But the Judgment obscures the court's intentions by enjoining all modifications [of MPO] ... which are the subject of the Temporary Restraining Order (TRO) issued March 15, 1990, because no MPO modifications were expressly the subject of the TRO. Indeed, no modifications of MPO existed at the time the TRO was entered: no legal action by K-T had yet compelled such modifications. We hold, however, that whatever the court intended in that regard, it lacked the authority to enjoin generically all future modifications of MPO. Rather, the most that it could enjoin were future modifications and improvements of MPO that are substantially similar to K-T's copyrighted Materials. 24 44 Under copyright law, the district court could enjoin only those future versions of MPO that are substantially similar to K-T's Licensed Materials. LSI is free to continue its efforts to devise a non-infringing management training program, notwithstanding any expansive language in the district court's opinion to the contrary. 25