Brief Amicus Curiae of Law Professors in Support of Appellant

CERTIFICATE OF INTEREST

The undersigned counsel of record for the signatories of this brief furnishes the following information in compliance with Fed. R. App. Proc. 29.

1. Amici curiae are professors of law at various law schools throughout the United States. They teach, write about, or have an interest in the proper resolution of questions of copyright and computer law. To the best of their knowledge, they have no financial interest in the outcome of this case nor are they affiliated in any way with any of the parties to this case.

2. Amici are interested in the proper application of copyright law. They are filing this brief in order to assist this Court in applying the proper legal rule on an important issue of copyright remedies.

3. Amici have received the consent of all parties to this case to the filing of this brief, and have therefore filed it without a separate Motion for Leave.

4. While amici are employed by various law schools, they do not represent or speak for their institutions in this matter, and institutional affiliations are listed for identification purposes only.

5. Although the undersigned is Of Counsel to Fish & Richardson, he has authored this brief in his individual capacity.

Amici respectfully request that this Court reverse the decision below. There are numerous grounds for reversal on the merits. The district court opinion misconstrued copyright's fair use doctrine by applying an outmoded "presumption" that commercial uses are unfair, despite the Supreme Court's rejection of that presumption in Campbell v. Acuff-Rose Music, Inc., 114 S. Ct. 1164 (1994). The district court failed to acknowledge the uniquely transformative nature of Connectix's intermediate copying, which produced an end product that contained no infringing material. And it failed to give proper respect to this Court's decision in Sega Enter. Ltd. v. Accolade, Inc., 977 F.2d 1510 (9^th Cir. 1992), which held that the nature of a computer program justified precisely the sort of intermediate copying that is at issue here. We believe, therefore, that there is ample reason to reject the district court's conclusion on the me rits of the fair use defense.

Even if this Court were to affirm the district court's conclusion on fair use, however, it should reverse the grant of a preliminary injunction. The injunction the district court granted is unprecedented in its scope. By enjoining what is admittedly a noninfringing product, the district court has not only departed from precedent, but has introduced a dangerous and potentially corrosive remedial concept into copyright law.

The district court readily concedes that the product it enjoins "does not contain any copyrighted material." Dist. Ct. Opinion at 26-27. Sony's theory of the case all along has been that Connectix used Sony copyrighted material to develop a new BIOS. But as the district court itself concluded, the Connectix VGS is not itself infringing because it contains no copyrighted code. Nonetheless, the court enjoined not only the making of further intermediate copies of Sony's BIOS, but the sale and distribution of the noninfringing VGS product. The court reasoned that "the only effective remedy for [] intermediate infringement is to enjoin the end product. If not, an intermediate infringer could always avoid the consequences of illegal copying and use by editing the protected code out of its final product." Dist. Ct. Opinion at 27.

We urge this Court to reject the district court's conclusion for three reasons. First, there is simply no support in copyright law for enjoining a noninfringing product because the people who made it infringed a copyrighted work at a different point in time. Second, the principle adopted by the district court will have damaging effects on the balance struck by copyright law. Finally, the district court was simply incorrect to suggest that there is no other effective remedy for intermediate infringement.

1. Copyright Law Does Not Support Such a Remedy

The copyright statute offers no support for the district court's remedial theory. 17 U.S.C. sec. 502(a), which authorizes injunctions in copyright cases, permits such injunctions only in order "to prevent or restrain infringement of a copyright." It does not contemplate enjoining noninfringing material. The legislative history to the 1976 Copyright Act specifically limits injunctive relief and impoundment to infringing materials. The House Report provides that courts have the power to grant preliminary injunctions "to prevent or stop infringements of copyright." H.R. Rep. No. 1476, 94^th Cong., 2d Sess. 160 (1976). Similarly, the House Report's discussion of impoundment remedies discusses "the courts' power to impound allegedly infringing articles . . . and to order the destruction or other disposal of articles found to be infringing." Id. Congress simply did not grant courts the power to enjoin or impound noninfringing materials.

Further, the only cases to have considered the question have concluded that there is no such authority. In Kepner-Tregoe, Inc. v. Leadership Software, Inc., 12 F.3d 527, 538 (5^th Cir. 1994), the district court had enjoined not only the first copy the defendants had made of the plaintiff's computer program, but also any present and future modifications of that program by the defendant. On appeal, the Fifth Circuit evaluated the modified software carefully to determine whether it was itself infringing before deciding whether to enjoin it. Id. at 534-38. And it flatly rejected the district court's injunction against "all future modifications" of the program. The Fifth Circuit's reasoning is instructive. It wrote: "We hold that whatever the court intended . . ., it lacked the authority to enjoin generically all future modifications of [the program]. Rather, the most that it could enjoin were future modifications and improvements of [ the program] that are substantially similar to K-T's copyrighted Materials." Id. at 538 (emphasis added). It further explained that a court would have to look at the modified programs the defendant developed in the future to determine whether those modified programs were themselves infringing. Only if the programs were themselves infringing could they be enjoined. Id. at 538 nn. 24-25.

Further support for this position can be inferred from the seminal software copyright case of Computer Associates v. Altai, Inc., 982 F.2d 693 (2d Cir. 1992). In that case, the defendants' first version of their software (OSCAR 3.4) admittedly copied substantial expression from the plaintiff's program. The defendants then revised that version to produce OSCAR 3.5, which they sold in the marketplace. The Second Circuit held that OSCAR 3.5 was noninfringing, and therefore ruled for the defendants, permitting it to be sold. But under the district court's reasoning in this case, OSCAR 3.5 should have been enjoined even though noninfringing, because it was developed using the infringing OSCAR 3.4 program. See also See v. Durang, 711 F.2d 141, 142 (9^th Cir. 1983) ("Copying [in an intermediate version] deleted or so disguised as to be unrecognizable [in the final version] is not copying."); In re Capital Cities/ABC, Inc., 918 F.2d 140, 144 (11^th Cir. 1990) (granting "surgically fashioned injunctive relief" against an upcoming television broadcast that enjoined only those portions of the broadcast which actually infringed the plaintiff's copyright).

The district court cited no precedent whatsoever for enjoining a noninfringing product as a sanction for copyright infringement. The one case it cited, Sega v. Accolade, 977 F.2d at 1519, merely held that intermediate infringement can in some circumstances be illegal. It emphatically did not hold that noninfringing end products based on that infringement could be enjoined even after trial, much less on a motion for preliminary injunction. There is simply no legal support for enjoining noninfringing works.

Nor is it correct to describe the Connectix BIOS or VGS as "derivative works" which might themselves violate the copyright law. Ninth Circuit law is quite clear that a work is "derivative" of a copyrighted work -- and therefore infringing -- only if the derivative work is substantially similar in protected expression to the plaintiff's work. Litchfield v. Spielberg, 736 F.2d 1352 (9^th Cir. 1984); accord Vault Corp. v. Quaid Software Ltd., 847 F.2d 255, 267 (5^th Cir. 1988). Because Connectix's final product is clearly not "substantially similar" to Sony's copyrighted code, it is simply not a derivative work.

B. It Would Be Unwise to Create a New Right to Enjoin Noninfringing Works

Section 502(a) limits injunctions to infringing works for good reason. Granting an injunction that extends to noninfringing works would have troubling consequences. As an initial matter, the district court's reasoning would seem quite hard to contain. Many copyrighted works are used in producing other works. Historians rely on the works of prior historians in writing their own books. Scientists rely on journal articles in designing their own experiments, and engineers in building products. This brief was written with a copyrighted Microsoft word processor. Each of these activities has heretofore been legal for the simple reason that the works these actors have produced do not contain any copyrighted material, and so they are not infringing. But the district court's injunction casts that fundamental assumption into doubt. Under the district court's approach, if an automotive engineer photocopies a scientific journal article for her research rather th an buying it, that engineer may risk not only liability for the unlawful copying, but an injunction against building or selling a car. This approach extends copyright law beyond its bounds in a troubling way. Copyright owners could use their copyright to control writings, products, and markets well beyond the scope of their copyright. This is not -- and should not be -- the law.

Nor should it matter whether Connectix would have been able to produce its products without intermediate copying. The Nimmer treatise treats this question directly in the following passage:

Nimmer on Copyright sec. 14.06[C], at 14-123 to 14-124. Cf. 2 Paul Goldstein, Copyright sec. 11.0, at 11:2 (2d ed. 1996) (enjoining defendant's original work "is surely overkill" even when it does contain some infringing material).

The policies articulated in the Nimmer treatise have particular resonance in this case because the district court issued a preliminary rather than a permanent injunction. The district court's decision on the merits is at the least controversial; it may well be that at trial Connectix will prevail on its fair use defense, just as Accolade did. Granting any preliminary injunction in such a circumstance is troubling, because it precludes the defendant from exercising its First Amendment rights. But the injunction the district court granted is far more troubling, because it is absolutely certain that Connectix's products do not themselves infringe Sony's copyrights.

Copyright's complex rules are designed as a compromise between the desires of authors and those of users. Stewart v. Abend, 495 U.S. 207, 225 (1990). The Copyright Act grants certain exclusive rights to authors, but it also contains limiting doctrines that prevent copyright owners from expanding the statute beyond its bounds. Fundamental among those limiting doctrines are the idea-expression dichotomy, 17 U.S.C. sec. 102, the doctrine of originality, Feist Publications Inc. v. Rural Tel. Serv. Co., 499 U.S. 340 (1991), and the rule that a copyright is infringed only by "substantial similarity not only of the general ideas but of the expressions of those ideas as well." Sid & Marty Krofft Television Prods. v. McDonald's Corp., 562 F.2d 1157 (9^th Cir. 1977). The district court's creation of a new right to enjoin noninfringing material threatens to upset the "scheme of carefully balanced property rights" at the heart of cop yright law. The district court enjoined the sale and distribution of products that did not contain any protectable expression, and were admittedly not substantially similar to Sony's copyrighted works. In doing so, the court effectively removed the idea-expression and substantial similarity limits -- two of the most important pillars upon which the balance of copyright rests.

C. Sony Has Other Remedies Available to It.

The district court enjoined the noninfringing Connectix products in large part because it felt there would be no effective remedy for Sony otherwise. In this, the court was simply mistaken. Sony has a wide variety of remedies available to it if it prevails on its theory of intermediate infringement. It can enjoin the act of intermediate copying, and the sale of any products that actually embody copyrighted material. 17 U.S.C. sec. 502(a). Should it prevail at trial, Sony is entitled to its damages resulting from the infringement, or Connectix's profits attributable to infringement, whichever is greater. Alternatively, Sony can choose to elect statutory damages, which must be granted by the court even if Sony can prove no harm whatsoever. 17 U.S.C. sec. 504. It is also entitled to attorneys' fees and costs in an appropriate case. 17 U.S.C. sec. 505.

The remedial powers of the courts in copyright cases have been spelled out in great detail in the Copyright Act. The Act gives copyright owners a wide range of remedies. It also provides for criminal penalties in appropriate cases to deter willful infringement. 17 U.S.C. sec. 506. The remedies provided in the Act do not include the sort of injunction the district court issued here. The court should not be permitted to rewrite the statute in order to create a new category of relief.

We believe that Connectix should prevail in this litigation on fair use grounds. Even if it does not, we urge this Court to reject the unprecedented remedy ordered by the district court in this case.