In the recent judgment by European Court of Justice in the SAS Institute Inc. v World Programming Ltd. case the court determined the level of copyright protection in the functionality, as opposed to the code, of computer programs. The decision will make it harder for owners of copyright to enforce their rights when the alleged infringer has no access to the source code, and has only reproduced the functionality of a program.

The Claimant, SAS Institute Inc (“SAS”), was a software developer. It had developed an integrated set of analytical software systems over the past 35 years which enabled its users to perform a wide range of data processing and analysis. The SAS program allowed users to write their own application programs in a specific computer language (“SAS Language”) in order to adapt the system to work with the user’s data.

The alleged infringer, World Programming Ltd (“WPL”), identified a possible market for alternative software capable of executing application programs written in SAS Language. WPL tried to emulate the functionality of the SAS software in their own program, the “WPL Program” but crucially did not have access to the SAS source codes.

SAS brought proceedings against WPL for copyright infringement. It disputed recent case law which suggested that it is not a breach of copyright to study how a computer program functions and then to write a similar program to reproduce the functionality. SAS also alleged that WPL copied a SAS manual to create the WPL Program, and its accompanying manual copied vital SAS program components and breached the terms of a licence agreement.

The ECJ ruled that:

  • the functionality of a computer program, its programming language and the format of the data files used are not protected by copyright  
  • a person who has lawfully obtained a copy of a computer program under a licence is allowed to observe, study and test the program’s functioning without needing further authorisation from the copyright owner, provided that in so doing that person only carries out acts which are either permitted in the licence to use the program or are otherwise allowed by law. Such acts will not breach copyright and cannot be contractually prohibited in a licence agreement. This will only be the case where the owner’s copyright in the program is not infringed
  • the reproduction of an original user manual in another computer program or accompanying manual may be a breach of copyright in the manual if the original user manual was the intellectual creation of the author. The ECJ ruled that it is for national courts to decide whether a reproduction of such elements in the new manual or program constituted the reproduction of the original author’s intellectual creation, and so infringed the copyright in that original manual.

The case has now been sent back to the High Court for a final ruling on the facts of the case.

Given the difficulties in obtaining valid patent protection for software inventions, there has been pressure from some software developers for the law of copyright to develop to fill the gap. The following key points to be taken from the judgment are:

  • this decision of the ECJ marks a clear set back to those hopes. Non-textual copying of software which merely imitates the functionality of a computer program in another program will not amount to an infringement of copyright. A breach of copyright will only occur when a substantial part of the source code or object code has been copied.
  • a copyright owner cannot prevent a licensee from observing, studying and testing the program in order to produce a program which has similar functionality. However, a licensee will only benefit from such protection so long as any reproduction does not go any further than the normal loading and running of the program.

This judgment is in accordance with the existing view of the law in this area. It confirms that it is difficult for copyright owners to enforce their copyright when they suspect that the functionality of their computer program has been copied, without copying of the actual code (or text of a user manual).

However, infringement of copyright can still occur where non-literal copying of source code occurs, for example the copying of the structure or functional distribution within a program. Copyright owners may therefore still be able to take action against possible infringers who have had access to the source code of their programs, even if none of that code is reproduced in the infringer’s program.