ILAW: Fisher on Software--Proprietary Legal Strategies
Professor William "Terry" Fisher speaks next, on "Computer Software: Proprietary Legal Strategies."
[Also see weblog notes and commentary from participants Frank Field, Aaron Swartz and Jim Flowers; they're catching what I miss.]
Terry: The original plan for the day was disrupted, so we had the debate between Larry and Jason at 2:00 p.m. Let me fill in the legal background for the debate we just had.
Proprietary strategies for software. Various protection regimes: 1/trade secret law, 2/copyright law, 3/patent law and 4/contract law.
Proposition: as between these varying systems, my view is not as clear as Larry's with regard to patent law and software. If patent is construed appropriately, it might be better, not worse than other means. Contract, meanwhile, might be worse.
Trade secret law is potentially a vehicle for protecting software because of the distinction between object and source code.
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What do you have to do to protect a trade secret? It's essential that it be secret from the outset. The firm must make reasonable efforts to keep the secret.
Under what circumstances would you be able to sue someone to get hold of it? 1/breach of confidence, and 2/secret was discovered through improper means.
Like what? Things that are themselves independently illegal. But also includes some kinds of activities that are not necessarily illegal but improper.
Critical thing that weakens this for software: reverse engineering is permissable. If you buy software and use decompilers, you can ascertain the underlying source code. There is no legal problem; no violation.
Second strategy: copyright law. Extended in most jurisdictions to software. Software is treated like a novel or a painting. Author enjoys the standard entitlements. They are limited by important exceptions: 1/the fair use doctorine, 2/"merger." To address the doctorine of merger, we address the idea/expression dichotomy. When there is only one way of expressing an idea, they merge and the product is not protectable.
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Apple v. Franklin: Franklin copied the Apple OS. Apple brought suit. Franklin says, yes, we copied. But there is only one way to make a computer support the Apple applications--it is to copy the OS. The merger doctorine protects us. Third Court of Appeals said no; Franklin went out of business.
TRIPS--extends this principle around the world. Both source and object code must be protected. Exceptions must be limited.
It has been suggested that the American fair use doctorine violates this exceptions clause in TRIPS.
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What distinguishes TRIPS from something like Berne is that a government can compel another government to ante up.
Why am I suggesting that copyright as a protection for software is declining? You can carry out: 1/nonliteral copying of features of a program (Altai test, Nichols pattern test) 2/reverse engineering for the purposes of interoperability, 3/copy menu hierarchies...about which Jonathan has a story.
JZ: I was programming manager for Excel 3.0. It was my job at MS to come up with synonyms for words in hierarchy--with the same first letter.
Terry: Lastly, there is 4/ineffective enforcement. [Cites BSA piracy reports. Makes very amusing correlation between states that vote for Bush or Gore and piracy rates.]
Patent protection for software: three Supreme Court decisions, then leave to federal circuit. Gradual relaxation of the rules. Pretty much any piece of software is patentable.
How is patent applied here? 1/utility, 2/novelty, 3/obviousness, 4/disclosure. In the software context, the obviousness factor is raised.
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You don't have to reveal source code to get the patent.
JZ: How much of a big deal would it be to yank patent from the set of protections?
Terry: Anyone have an answer?
Participant: I'm not sure how we answer that question. People would still write software, but without protection, new activities would be undertaken at a lower rate.
2nd participant: Or people will fall back on contract.
Terry: Exactly where we are about to go.
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Before moving on to contract, let me say I disagree with Larry about patents on software. At minimum it is harder to get than copyright. Also narrower in the sense that copyright law requires only substantial similarity. The standard for patents is "make, use or sell." That's harder to show.
However, there are some respects in which patent law could be improved. Change rules so as to compell applicants to reveal source code. Patent misuse defense. Main point: with some adjustment, patent law might be better than copyright law. But copyright law is set in stone, via TRIPS. Patent law is not. Easier to cut back on patents.
Contract law is much more protective than anything we've looked at before: Typical shrink-wrap overrides first sale, overrides fair use, etc.
Are contracts enforceable? Unclear, unstable legal doctorine: 1/UCITA (only adopted in two states), 2/Pro-CD, 3/Vault, 4/Bowers v. Baystate.
Does state law (contract) beat federal law (copyright)? Disagreement in the courts.
Contract law the real threat here.
[Final Q&A, concluding remarks; end of session.]