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U.S. Intellectual Property and New Media Law Update WEST WENT DOWN Matthew Bender & Co. et al. v. West Publishing Co. et al. (Second Cir. - November 3, 1998) COLONEL CLINK WINS Hogan Systems, Inc. v. Cybresource Int’l., Inc., et al. (5th Cir. 1998) IBM KEEPS EXPANDING WWW.IBM.COM/PATENTS (November 1, 1998) THE NEXT CHAT ON THE INTERNET MAY BE WITH THE PTO U.S. Patent & Trademark Office - October 20, 1998 WEST WENT DOWN Matthew Bender & Co. et al. v. West Publishing Co. et al. (Second Cir. - November 3, 1998) This is actually two Court of Appeals decisions arising from the same case and two interesting, but we think incorrect, dissents by Judge Sweet. As we all know from our mis-spent youth in law libraries, Defendant West publishes compilations and reports of judicial opinions. Each case report contains the text of the opinion combined with certain enhancements including a syllabus, headnotes, key numbers, parallel citations, identification of counsel, and, in some cases, information on subsequent procedural history. Hyperlaw, Inc. produces CD-ROMs which contain reproductions of the factual information, the text of the opinion, including parallel or alternate citations to cases, attorneys' information and data on subsequent procedural histories. It does not include the independently composed features such as the syllabus, headnotes and key numbers. Hyperlaw, Inc. sought confirmation that its conduct was proper in reproducing cases on its CD- ROM. West claimed that its rearrangement of information, its specification of the parties, courts and date of decision, the addition of certain information concerning counsel, the annotation reflecting subsequent procedural developments such as amendments and denials of hearings and editing parallel and alternate citations are copyrightable. All of these alterations involve the additions or arrangement of facts or the rearrangement of data already included in the opinion. The Second Circuit noting that the only creativity could be in West's selection and arrangement of the information found the actual arrangement to be obvious, lacking even minimal creativity. It therefore affirmed the District Court's finding that West's case reports are not copyrightable. This opinion can be found at: http://laws.findlaw.com/2nd/977430.html Judge Sweet, sitting by designation, dissented. Judge Sweet found that the West version required some thought and was sufficiently creative to satisfy the modicum of creativity necessary for copyrightability. The dissent can be seen at: http://laws.findlaw.com/2nd/977430dis.html In a second, related opinion in the same case, the Court found that Matthew Bender & Co.'s system of star citation, that is, insertion of citation within Bender's version of judicial opinions to show the location of particular text in Defendant's printed version of the opinion did not infringe West's copyright in their compilations. West conceded that the specification of the initial page of the West case reporter is permissible under the fair use doctrine, but maintained that later pages in each opinion weren't. Bender's CD-ROM is clearly not arranged in the same order as the West citations. West's primary contention on appeal was that Bender's star pagination allows a user of their CD-ROM product to perceive West's copyright protected arrangement of cases and, thus, the product with star pagination is an unlawful copy of the West arrangement arising from its copyright in the compilation. In order to reconstruct the West volume, one would have to go to the first case in a West book as ascertained by inputting, for example, 300 F.2d 1. Then, go to the end of the case and click on the star pagination to obtain the next case. By so doing for however many cases were in that volume, one would then create electronically a duplicate volume of the West book. No one explained why any sane person would want to do this. The Second Circuit found that the pagination was done by a computer and, therefore, lacked creativity and was not an original creation of the compiler. Since the arrangement is equivalent to the West arrangement only if the material on the CD-ROM is rearranged, the Court found no infringement. Equally, it found no contributory infringement because the CD-ROM disc is capable of substantially non-infringing use. The opinion can be seen at: http://laws.findlaw.com/2nd/977910.html Judge Sweet also disagreed with this opinion. Sweet felt that the ability to rearrange the CD-ROM into the same order as the West book was essentially making a copy and that the majority's opinion eviscerated copyright protection for compilations. The dissent can be seen at: http://laws.findlaw.com/2nd/977910dis.html COLONEL CLINK WINS Hogan Systems, Inc. v. Cybresource Int’l., Inc., et al. (5th Cir. 1998) Plaintiff, Hogan Systems, Inc. ("Hogan") is the developer and owner of copyrighted data processing software used by major banks worldwide. Its employees enter into secrecy agreements. The individual Defendants are former Hogan Heroes who defected and formed Cybresource Int'l. Cybresource entered into an agreement with Hogan which included trade secret status protection for the Hogan software. This agreement was in anticipation of the Defendants' performing maintenance services for Hogan. Cybresource thereafter entered into an agreement with Norwest, a licensee of Hogan, to maintain Hogan's programs without the consent required by the Cybresource-Hogan Agreement. The current battle ensued. First, Hogan claimed copyright infringement. Both the District Court and the Fifth Circuit found that Hogan's Norwest license sheltered Cybresource's activity since the agreement authorized third party contractors to provide consulting services on Hogan produced software. The Hogan-Norwest License specifically provided that information could be disclosed to third parties under the agreement. The Court then dealt with a number of possible interpretations presented by the Plaintiff in an attempt to find that the conduct was unauthorized by the license agreement. The most interesting one was that the individual Defendants had improper off-site access to software and that one of the Defendants regularly worked on software from an off-site location and, as such, necessitated copying and removing the software from Norwest's premises. The Court found that the copying simply consisted of remote viewing and offered proof that it never removed the software from any Norwest terminal. It merely displayed it from the Norwest mainframe. Such use does not constitute copying under Federal copyright law. The Court also kicked out the trade secret counts since it was, in fact, general knowledge, skill and experience rather than specific confidential information of the Plaintiff's. The District Court awarded attorneys' fees and costs. The losing Plaintiff maintained that this was in violation of the standards laid out by the Supreme Court in Fogerty v. Fantasy, Inc., 510 U.S. 517 (1994). The Fifth Circuit found that its standard of discretionary, but routinely awarding such fees, was in conformity with Fogerty and affirmed the award of attorneys' fees. The decision can be viewed at: http://www.ca5.uscourts.gov/opinions/pub/97/97-10645-CV0.HTM IBM KEEPS EXPANDING WWW.IBM.COM/PATENTS (November 1, 1998) IBM has expanded its patent database to include European patents and applications as well as international patent applications covered by the International Patent Cooperation Treaty (PCT). The new references came on-line on November 1, 1998. While searching and viewing patents remains free, there is a fee for delivery of the copies. The web site can be accessed at: http://www.ibm.com/patents THE NEXT CHAT ON THE INTERNET MAY BE WITH THE PTO U.S. Patent & Trademark Office - October 20, 1998 The PTO has requested comments on its proposed Internet usage policy for communications with applicants or for informational searches regarding applications by the PTO. Communications via Internet e-mail is up to the discretion of the applicant who must submit a written request for such. The proposed Internet usage policies can be seen at: http://www.uspto.gov/web/offices/com/sol/notices/fr981020.htm |
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