DATA CASH Systems, Inc. v. JS&A Group, Inc., et al.

U.S.Dist.Ct, N.Dist. Ill, Eastern Div.

480 F. Supp. 1063 (1979)

FLAUM, J. This action for copyright infringement and unfair competition is brought by the creator of a computer program against the corporations and the officers of these corporations which are allegedly reproducing, importing, distributing, selling, marketing and advertising copies of plaintiff's computer program. Plaintiff has filed a motion for a preliminary injunction and defendants JS&A Group, Inc. ("JS&A"), Joseph Sugarman ("Sugarman"), and Mary Stanke ("Stanke") have filed a motion for summary judgment. For the reasons set forth below, the motion of defendants JS&A, Sugarman and Stanke for summary judgment is granted on Count I of the First Amended Complaint for Infringement of Copyright ***

Before discussing the facts in this case, it is necessary to set forth what exactly a computer program is. A computer program has been defined generally as a set of precise instructions that tells the computer how to solve a problem. *** Normally , a computer program consists of several phases which may be summarized as follows. The first phase is the development of a flow chart which is a schematic representation of the program's logic. It sets forth the logical steps involved in solving a given problem. The second phase is the development of a "source program" which is a translation of the flow chart into computer programming language, such as FORTRAN or COBOL. Source programs may be punched on decks of cards or imprinted on discs, tapes or drums. The third phase is the development of an "assembly program" which is a translation of the programming language into machine language, I.e., mechanically readable computer language. Unlike source programs, which are readable by trained programmers, assembly programs are virtually unintelligible except by the computer itself. Finally, the fourth phase is the development of an "object program" which is a conversion of the machine language into a device commanding a series of electrical impulses. Object programs, which enter into the mechanical process itself, cannot be read without the aid of special equipment and cannot be understood by even the most highly trained programmers. ***

Thus, at some point in its development, a computer program is embodied in material form and becomes a mechanical device which is engaged in the computer to be an essential part of the mechanical process. At different times, then, a given program is both "source" and "object". The "source program" is a writing while the "object program" is a mechanical tool or machine part.

In this case plaintiff retained an independent consultant, D. B. Goodrich and Associates, to design and develop a computer program for a computerized chess game, CompuChess, which was to be manufactured and sold by plaintiff. From September 1976 to April 1977 D. B. Goodrich and Associates designed and developed the basic instructions which told the computer how to play chess at six different levels of difficulty. This process involved the four phases in the development of a computer program discussed above. The instructions were translated into programming language, the source program, which then was translated into machine language, the assembly program. This assembly program was then used to create the object program, the Read Only Memory (the "ROM"). This ROM was then installed in the computer as part of its circuitry.

Thus, CompuChess is a hand-held computer which uses keyboard and data display devices to input and output information. The human player enters his move on the keyboard device by pressing certain keys and the computer relays its move on the data display device by displaying certain letters and numbers.

In late 1977 plaintiff began to market the CompuChess. No copyright notice appeared anywhere on the ROM, the CompuChess itself, its packaging, or its accompanying literature. The copyright notice did appear, however, on the source program and all copies thereof. In November of 1978 the source program was filed with the Register of Copyrights and on November 28, 1978 a Certificate of Copyright Registration was issued to plaintiff.

In late 1978 defendants JS&A, Sugarman and Stanke began marketing the JS&A Chess Computer. The ROM in the JS&A Chess Computer is identical to the ROM in plaintiff's CompuChess. In early 1979 plaintiff filed this action for copyright infringement and unfair competition.

Where, as here, the pleadings, depositions, answers to interrogatories and affidavits show that there is no genuine issue as to any material fact, then summary judgment should go to the party entitled to judgment as a matter of law. ***

Since the ROM in the JS&A Chess Computer is identical to the ROM in plaintiff's CompuChess, the court can assume that there was direct copying of plaintiff's ROM. However, the undisputed facts show that defendants JS&A, Sugarman and Stanke have a complete defense as a matter of law with respect to plaintiff's claim of copyright infringement.

Count I of the First Amended Complaint, the count alleging copyright infringement by defendants JS&A, Sugarman and Stanke, is brought under the Copyright Act of 1976, 17 U.S.C. @ 101 Et seq. (App.1976) (the "1976 Act"). Although this action should be brought under the 1976 Act, the 1976 itself does not apply.(1) Section 117 of the 1976 Act states:

this title (title 17) does not afford to the owner of copyright in a work any greater or lesser rights with respect to the use of the work in conjunction with automatic systems capable of storing, processing, retrieving, or transferring information, or in conjunction with any similar device, machine or process, than those afforded to works under the law, whether title 17 or the common law or statutes of a State, in effect on December 31, 1977, as held applicable and construed by a court in an action brought under this title.

The legislative history for section 117 explains that this section was enacted because the problems in the area of computer uses of copyrighted works are not sufficiently developed for a definitive legislative solution. Thus, the purpose of section 117 is to preserve the Status quo. It is not intended to cut off any rights that existed on December 31, 1977 or to create new rights that might be denied under the predecessor to the 1976 Act, the Copyright Act of 1909 ***

Therefore, a court, in deciding the scope of exclusive rights in the computer area, first must determine the applicable law, whether state statutory or common law or the 1909 Act. After determining which law is applicable, the court's decision must depend upon its interpretation of what that law was on December 31, 1977. ***

If, as of the date of the alleged act of infringement, the computer program allegedly infringed had been neither published nor registered in the copyright office, then the common law copyright rule should be applied. Otherwise, the law under the 1909 Act should be applied. Prior to the complete revision of the 1909 Act, the American law of copyright had been the subject of a dichotomy between federal and state law. Unpublished works were automatically protected by state law, referred to somewhat inaccurately as common law copyright. Such protection began at the moment of creation and terminated upon publication when common law copyright was lost. Thereafter, protection was available, if at all, only through federal, or as it is generally known, statutory copyright. ***

The parties have assumed that the ROM is a "copy" of the computer program created by plaintiff within the meaning of both the common law and the 1909 Act.(2) The court does not agree. Both at common law and under the 1909 Act, a "copy" must be in a form which others can see and read.

At common law the author's property in his unpublished work included the right to publish, or to refrain from publishing, at his option, and the right of restraining others from publishing without his consent. The original manuscript and the incorporeal right of first publication were the private and exclusive property of the author. He had the sole right of first printing and publishing it for sale. Thus, the unauthorized publication of an author's work was a violation of the author's common law right to the "copy". *** At common law the noun "copy" signified a tangible object that was a reproduction of the original work. Although any mode of reproduction, whether by printing, writing, photography, or by some other method not yet invented, constituted a copying, to be a "copy" there must have been an appeal to the eye. Thus, the term "copy" has been defined as that which comes so near to the original as to give to every person seeing it the idea created by the original. ***

This same conclusion is reached under the 1909 Act. The 1909 Act and its predecessors gave authors the exclusive right, Inter alia, to copy the copyrighted work. *** In White-Smith Music Publishing Co. v. Apollo Co., 209 U.S. 1, 28 S. Ct. 319 (1908), the Supreme Court held that a piano roll was not a "copy" of the musical composition recorded thereon and therefore, that the defendant, in making an unauthorized piano roll of plaintiff's musical composition, had not infringed plaintiff's "right to copy". After quoting the definition of copy set forth in Boosey v. Whight, the Supreme Court defined a copy of a musical composition as "a written or printed record of it in intelligible notation". 209 U.S. at 17, 28 S. Ct. at 323. In reaching this result the Court stated:

"It may be true that in a broad sense a mechanical instrument which reproduces a tune copies it; but this is a strained and artificial meaning. When the combination of musical sounds is reproduced to the ear it is the original tune as conceived by the author which is heard. These musical tones are not a copy which appeals to the eye. In no sense can musical sounds which reach us through the sense of hearing be said to be copies as that term is generally understood, and as we believe it was intended to be understood in the statutes under consideration." 209 U.S. at 17, 28 S. Ct. at 323.

Noting that the perforated rolls were parts of a machine which, when duly applied and properly operated in connection with the mechanism to which they were adopted, produced musical tones in harmonious combination, the Supreme Court concluded that they were not "copies" within the meaning of the copyright act then in existence.

Congress in the 1909 Act implicitly adopted the White-Smith definition of "copy". *** Thus, since the ROM is not in a form which one can "see and read" with the naked eye, it is not a "copy" within the meaning of the 1909 Act. In its object phase, the ROM, the computer program is a mechanical tool or a machine part but it is not a "copy" of the source program. ***

Even assuming that the ROM in plaintiff's CompuChess was copied by defendants JS&A, Sugarman and Stanke, the ROM is not a "copy" of plaintiff's computer program and therefore the copying is not actionable. Since a complete defense as a matter of law with respect to plaintiff's claim of copyright infringement exists, the motion of defendants JS&A, Sugarman and Stanke for summary judgment *** is granted on Count I of the First Amended Complaint. ***

1. Even if the 1976 Act did apply, copying of the ROM would not be actionable. Under the 1976 Act "copies" are defined as

"material objects, other than phonorecords, in which a work is fixed by any method now known or later developed, and from which the work can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device. The term "copies" includes the material object, other than a phonorecord, in which the work is first fixed." 17 U.S.C. @ 101 (App.1976).

While the new definition of copy encompasses works which may be perceived "with the aid of a machine or device," the court believes that the 1976 Act applies to computer programs in their flow chart, source and assembly phases but not in their object phase, I.e., the ROM, for the following reasons:

(1) Proposed Regulation @ 201.20, which sets forth the suggested methods of affixing and positioning the copyright notice on various types of works in order to satisfy the requirement in section 401(c) of the 1976 Act, @ 401(c) (App.1976), that the copyright notice "be affixed to the copies in such manner and location as to give reasonable notice of the claim of copyright," states:

"(g) Works Reproduced in Machine-Readable Copies. For works reproduced in machine-readable copies (such as magnetic tapes or disks, punched cards, or the like) from which the work cannot ordinarily be visually perceived except with the aid of a machine or device, the following constitute examples of acceptable methods of affixation and position of the notice:

(1) A notice embodied in the copies in machine-readable form in such a manner that on visually perceptible printouts it appears either with or near the title, or at the end of the work;

(2) A notice that is displayed at the user's terminal at sign on;

(3) A notice that is continuously on terminal display;

(4) A permanently legible notice reproduced on a gummed or other label securely affixed to the copies or to a box, reel, cartridge, cassette, or other container used as a permanent receptacle for the copies."

(2) In its object phase, the computer program is a mechanical device which is engaged in the computer to become an essential part of the mechanical process. *** Mechanical devices which cannot qualify as pictorial, graphic or sculptural works are not writings and may not obtain copyright protection. ***

2. Since the parties have assumed that the ROM is a "copy" of plaintiff's computer program, they have perceived the issue here to be whether the sale of the CompuChess, which contains the ROM, was a publication of the computer program. Since the court concludes that the ROM is not a "copy" of the computer program, it need not reach this issue.