Computer software derivative works: the calm before the storm.

• Author: Heineman, Natalie

1. Introduction

   Every generation believes they live in the most exciting times of continued social and technological advancement. Since the advent of computers and the internet, however, the present is a time in which progress seems unrivaled. While the law races to catch up with technology, the area of law requiring the fastest runners may be that of computer software derivative works under current copyright law. An author's exclusive right to prepare derivative works is particularly challenged in the software environment where innovation often involves references to and incorporation of other preexisting works. Without definitive cases on point or specifically tailored legislation to guide the analysis, however, the scope of this note is simply to help define the issues presented, thereby drawing attention to what looks to be the calm before the impending storm.

   This note considers the challenge posed by computer software derivative works. The note first discusses the definition of derivative works under the current Copyright Act, and analyzes how the courts have interpreted derivative works in analogous contexts. Because defining a derivative work necessarily considers whether it has infringed the underlying work, the note then discusses how the courts make infringement analyses. The infringement analysis focuses primarily on the abstraction-filtration method as it has developed in computer software cases. Finally, the note considers trends in cases and legislation that suggest an increasingly broad interpretation of derivative rights. This section emphasizes the Open Source movement which will no doubt have a significant impact on the future of computer software derivative works.

2. Defining Derivative Works & Software in the Copyright Act

   1. The Acts of 1790, 1870 and 1909

      The exclusive right to prepare derivative works is relatively new to the law of copyright. The Act of 1790 protected only specific kinds of works, namely maps, charts and books and did not provide any protection for derivative works. (1) At the time, copyright law was intended to protect the physical works themselves as opposed to the author's right against copying or distribution. (2) Congress, perhaps in response to technological changes, expanded copyright in 1870 to include dramatizations and translations. (3) The 1909 Act added that making variations to protected works was an exclusive right granted to the author. (4) Congress limited the scope of this right by identifying specific variations that were protected based on their respective underlying work. (5) Although a limited right, the addition was significant. Prior to the enactment of the 1909 Copyright Act, the courts interpreted derivative works through the lens of the idea-expression dichotomy. (6) As a result, courts decided the less precise issue of whether the underlying work was copyrightable and if so, whether the defendant had violated the plaintiff's right to reproduce the work. (7) This approach left a gap for works that were similar to the underlying work, but which had changed form or function enough to avoid being characterized as strictly reproduci ng it. (8)

   2. The Copyright Act of 1976: Derivative Works & Software

      The Copyright Act of 1976 expressly provides for an author's exclusive right to prepare derivative works from her original, underlying work. (9) Subject to applicable limitations in Sections 107 through 120 of the Act, Section 106 grants to an author of a copyrighted work the exclusive right to "prepare derivative works based upon the copyrighted work." (10) Section 103 provides that derivative and collaborative works, if sufficiently original, are independently copyrightable. (11) It provides:

      The subject matter of copyright as specified by section 102 includes compilations and derivative works, but protection for a work employing preexisting material in which copyright subsists does not extend to any part of the work in which such material has been used unlawfully. The copyright in a compilation or derivative work extends only to the material contributed by the author of such work, as distinguished from the preexisting material employed in the work, and does not imply any exclusive right in the preexisting material. The copyright in such work is independent of, and does not affect or enlarge the scope, duration, ownership, or subsistence of, any copyright protection in the preexisting material. (12)

      Section 101 of the Copyright Act of 1976 provides the following definition:

      A "derivative work" is a work based upon one or more preexisting works, such as a translation, musical arrangement, dramatization, fictionalization, motion picture version, sound recording, art reproduction, abridgment, condensation, or any other form in which a work may be recast, transformed, or adapted. A work consisting of editorial revisions, annotations, elaborations, or other modifications which, as a whole, represent an original work of authorship, is a "derivative work." (13) Nimmer defines a derivative work as consisting of "a contribution of original material to a preexisting work so as to recast, transform or adapt the preexisting work." (14) An interesting philosophical argument concerning the nature of derivation itself was posited by Justice Story more than a century ago in Emerson v. Davies. (15) He argued that in truth all works are derivative works since no act of creativity takes place in a vacuum and unaffected by ideas that already abound in the world. (16) While Justice Story's oft-quoted opinion deals more squarely with the idea-expression dichotomy, it speaks to the fundamental issue of what is properly viewed under the law of copyright as an original contribution by one author to the work of another. (17)

      The Act of 1976 as enacted did not, however, expressly protect software, although the House Report expressly intended that the scope of Section 102 include computer programs. (18) Meanwhile, Congress established the National Commission on New Technological Uses of Copyrighted Works ("CONTU") for the express purpose of studying computer technology and making recommendations for potential revisions to the 1976 Act. (19) The CONTU Final Report recommended that the Copyright Act be amended to make it explicit that computer programs are copyrightable subject matter. (20) The Report reasoned that the cost of making computer software is far greater than the cost or ease of copying them, and recognized that, in order to provide an incentive for continued software development, the law should provide more tailored protection. (21) CONTU recommended that Section 101 of the 1976 Act be amended to include a definition of computer programs, and suggested the following definition: "a set of statements or instructions to be used directly or indirectly in a computer in order to bring about a certain result." (22) Congress incorporated the CONTU definition verbatim in 1980. (23) One court has concluded that, in light of the scarce legislative history accompanying the 1980 revision, the CONTU Final Report should be considered instructive as to Congressional intent. (24) It is noteworthy, however, that the decision to protect software under the copyright laws did not pass without its critics. (25)

      Software has many definitions, but as Section 101 contemplates, most definitions share the underlying concept that software is essentially comprised of instructions designed to cause a certain result, or of data structures that allow information to be manipulated. (26) More specifically, unlike a computer's hardware whose elements are physical, software is essentially comprised of logic, most fundamentally in the form of algorithms. (27) The programming process begins in a high level language such as BASIC and uses English words or phrases to describe the programmer's desired commands in shorthand. (28) The computer's hardware, however, cannot understand these English instructions. (29) The programmer therefore must write a lower level "assembly" language or source code, which is comprised of symbols that prepare instructions for the computer's understanding. (30) Since computers operate on machine code, even the symbols of the assembly language must be translated into machine-readable object code by an assembler or compiler. (31)

      As is further discussed below, recent decisions have established that the copyright protection afforded computer programs applies to both object and source code. (32) In addition, a program's "look and feel," as well as all visual outputs including graphic user interfaces ("GUIs") are now protectable. (33) The protectability of computer software derivative works, however, has not been as well defined. Defining the scope of protection for software derivative works presents a problem that may not be swept under the rug. The computer software industry is said to progress by a "stepping stone improvement process, with each innovation building on past innovations to produce an improved product." (34) The creative process for works of technology is incremental, and it is more common that new developments build on prior works rather than introducing an entirely new concept. (35) The very impetus behind the Open Source movement was to protect the right to use such a process without the intervention of the copyright laws to withhold access to prior works. (36) Without a directly applicable statute or cases on point, analysis of the problem may only be made by analogy and in light of policy considerations. The following sections of this note set out to make such an analysis

3. The Primary Elements of Derivative Works

   1. Originality of Derivative Work

      The material contributed to or used to adapt a preexisting work must be original in its own right. (37) The Second Circuit interpreted the 1909 Act as requiring a "substantial variation" from the underlying work to support copyright in a work adapted from it. (38) Specifically, the court held that a...