In software, where does creativity end and copyright infringement begin?

Information Strategies

See You In Court -- In software, where does creativity end and copyright infringement begin?

John J. Xenakis
InformationWeek

September 17, 1990

The software industry is spending a lot of time on a rather unfamiliar type of documentation these days: depositions, briefs, and other weighty texts that accompany litigation.

The end of the '80s and beginning of the '90s has witnessed a burst of contentious legal activity among software companies attempting to protect their product copyrights and patents-in other words, their market share. Some of the largest and most dominant firms-Apple Computer Inc., Lotus Development Corp., Ashton-Tate Co.-are making frequent trips to court, charging that the cheaper products offered by smaller niche vendors infringe on copyrighted user interfaces. (Apple has set its legal sights higher to include major players such as Microsoft Corp. and Hewlett-Packard Co.).

Conventional wisdom holds that the rash of lawsuits is a sign of maturation in the software industry. When the number of unfilled market niches dwindles and revolutionary, market-widening products become rare, the emphasis switches to protecting existing products and market share. That means suing the pants off competitors touting demonstrably similar products. In a market where litigation is now an acceptable method of gaining competitive advantage, a software company's legal department, rather than its R&D unit, can suddenly look like the star.

This internecine squabbling could indirectly affect corporate users if it forces some smaller software vendors to close up shop or chills the development climate at others, thus cutting down the number of purchasing options for IS. It also threatens what used to be standard practice in the

computer industry: implementing programs that are compatible with the competition, which often means mimicking, to some degree, the way data is presented on-screen. The result, according to the recently formed League for Programming Freedom, will be greater incompatibility between computer systems-exactly what users don't want.

Some argue that users could be even more directly affected if the vendors' litigious wrath should be shifted on them.huh? Several lawyers are warning that IS managers may be as vulnerable to charges of copying a user interface as they were in the past to copying code.

OTHER WORRIES

Not all users are convinced that there is cause for concern-yet.

"Maybe I'm being myopic, but we go 24 hours a day, seven days a week, worrying about new business, outsourcing, stuff like that," says George DiNardo, executive VP for information management resources at Mellon Bank Corp. in Pittsburgh. "I can't be worried about who Lotus sues." He adds that the lack of low-cost clones is not an issue either. "To be honest, I tried the cheap clones, and they didn't turn me on."

But a copyright lawyer argues differently, saying that there may be some potential booby traps for IS managers as a result of Lotus's smashing victory over Paperback Software Int'l, in which a federal judge ruled last June that Paperback's VP-Planner infringed on 1-2-3's user interface copyright. A hearing has been scheduled for Nov. 12 to assess damages. Paperback will probably be enjoined from selling any more copies of VP-Planner and may be required to pay damages to Lotus.

Flushed with victory, Lotus promptly sued Borland International Inc. and The Santa Cruz Operation Inc., alleging that those two companies' spreadsheet products, Quattro Pro and Professional, respectively, also violated 1-2-3's copyright.

"There are two sources of exposure to the MIS department" as a result of the Paperback decision, says Daniel Brooks of the law firm Cadwalader, Wickersham & Taft in Washington. A company now developing applications using Quattro Pro, for example, could have those copies confiscated. "I don't understand that any of the parties to the current lawsuits are disposed to play hardball on this issue," he adds. "However, as a tactical choice in its case, Lotus could ask the court for a confiscation order, based on probable success of their case. That's exactly what was done in the video game cases."

The cases that Brooks refers to occurred in the mid-'80s and were cited by Lotus as an important precedent. The software company argued that the user interface of 1-2-3 is protected by copyright just as the user interface of a video game is protected. Although the circumstances differ significantly, the confiscation of user software is not unprecedented; for example, the Software Publishers Association in Washington has advocated raiding user sites to retrieve pirated software.Michael Simmons, executive VP of technology and operations at Bank of Boston Corp., minimizes the prospect of software confiscation. "Some companies have disseminated copies of programs like Quattro Pro all over the world with site licenses," he says, "so it would be technically hard to do. I can't imagine someone trying to remove one file from every PC in the company." Even if the court ordered such a confiscation, it wouldn't pose too big a problem for users, Simmons adds. "Most of those products can be supplanted by another product with only a little re-entry and a little work," he says. "If you knew you were going to move from, say, Quattro Pro to Lotus, you could handle it with a little training. It wouldn't be fun, but if told by the court, and given a reasonable chance to do it, it shouldn't be hard."

BEWARE OF BAD PRESS

Ron Brzezinski, a partner who heads the information technology strategy and planning practice at New York-based accounting firm Coopers & Lybrand and former IS

director at Quaker Oats Co., argues that "a company like Lotus won't do it {confiscate} unless it wants to go out of business in one stroke because of the bad press."

The second potential problem attorney Brooks cites has to do with users who adopt the user interface of some other software product when developing their own in-house code. "If he's {the developer} going to sell the software to other people {outside his company}, he has a serious problem," Brooks notes. "But if he's building it only for in-house use, the problem is largely theoretical."

Most users agree that they see no problem if such software is kept for internal use. "If it's a problem, no one realizes that it's a problem," says Jerry Marino, systems design engineer at Raytheon Corp.'s Missile Systems Division in Tewksbury, Mass. "No one believes that Lotus will come down on the Raytheons of the world."

But, under the law, it is just as much copyright infringement to copy someone's user interface in in-house software as it is to use an office copier to copy an entire book for in-house use. Although he hasn't "heard of anyone being threatened, much less sued," Peter Marx, chairman of the Marx Group, a computer law firm in Wellesley, Mass., says, "everyone that develops software has to abide by the copyright laws."

The applicability of copyright law to users was further confirmed by a district court judge in Philadelphia last week in a case between Allen-Myland Inc. and IBM. The upshot of that ruling is that computer users don't have an unrestricted right to duplicate copyrighted software, even if it is for their own use.

Dave Steffens, chief engineer at Boston's Massachusetts Eye and Ear Infirmary, learned the hard way that copyright and patent law can affect users' internal development. "We were developing a computer-aided anatomical system, involving 3-D reconstruction of brain sections," he explains, when his development team hit upon a new method that would dramatically improve the reconstruction algorithm. "We put in a proposal for a government grant to do further work, and it turned out that another group in North Carolina had obtained a software patent on the idea."

Steffens says his team ended up having to pay a license fee to the other group. "Our lawyer said we'd probably win if we fought it, but we wouldn't get the grant for five years. We had to pay what we thought was a bribe to get our grant released." He points out that the same thing could happen with a software copyright as easily as with a software patent.

Steffens agrees, however, with the general thrust of the Lotus court decision. "Paperback Software should not be allowed to do it, especially since they advertised it as a clone of 1-2-3," he says. "When you actually say it's a duplicate of something else, and it's the same, keystroke for keystroke, then that shouldn't be allowed."Lotus's suit against Borland, though, is not as clear cut as that against Paperback. Borland's Quattro Pro is functionally different from 1-2-3 and has its own user interface. Lotus's only complaint with Borland is that the company provides an optional user interface that looks like the interface to 1-2-3.

The copyright infringement debate becomes even more complex when vendors attempt to copyright not only user interfaces but also programming languages, as is the case with Ashton-Tate in its pending 1987 case against Fox Software Inc. of Perrysburg, Ohio. Ashton-Tate is attempting to enforce a copyright on the entire dBase programming language and, encouraged by Lotus's victory over Paperback, is contemplating lawsuits against other dBase clone vendors.

The company is even eyeing competitors such as Computer Associates Int'l Inc. of Garden City, N.Y., whose CA-DB:cBase, a dBase-compatible program for IBM mainframes, is expected to be released within the next few months, according to Stanley Witkow, Ashton-Tate's general counsel.

Witkow believes that an Ashton-Tate victory will benefit the industry as a whole because it will encourage innovation. He foresees some sort of licensing arrangement whereby Ashton-Tate will collect royalties from clone-makers, much as other companies collect royalties on patents. "The challenge is for companies that own these proprietary rights to handle them appropriately," Witkow concludes.

Nonetheless, it's not at all clear whether it's possible to copyright an entire programming language. At one point, the Lotus decision implies that a programming language might be copyrightable; at another, it says that Microsoft Excel's macro translator, which translates 1-2-3 macros into Excel macros, is not a copyright infringement. Since a dBase clone is simply another translator, it is difficult to guess how the court will rule.

The Lotus/Paperback decision does provide answers to some of the questions posed by puzzled vendors and corporate software developers regarding when one program infringes upon another's user interface, but it leaves others unanswered. Is copying someone's file format an infringement? Is it infringement when one corporation copies another's enterprisewide objects while implementing, say, IBM's AD/Cycle Repository?

In the meantime, Mellon Bank's DiNardo has some advice for concerned IS managers: "Why would I copy someone else's user interface? Why would I copy anything? We all got burned in the past doing that.

"I make people sign an oath that they won't take anybody else's code or ideas, and they promise not to take any code or ideas developed here and give them to someone else." After all is said and done, the simplest approach may be the best.