The Court of Appeals of the state of São Paulo recently declared the illegality of counterfeit software for internet services on the grounds of improper use, unfair competition and violation of authorship rights in a creative work.

The plaintiff claimed ownership of rights relating to a website's software graphics and HTML (Hypertext Markup Language) coding. The defendant was accused of plagiarism for violation of copyright as well as infringement of software exclusivity rights.

At first instance, the defendant was prohibited from using the software in question and ordered to pay the plaintiff R20,000 (approximately $6,000). Both parties appealed, the defendant requesting a reversal of the decision and the plaintiff requesting an increase in the fine.

The appellate court ruled in the plaintiff's favour in light of domestic laws regarding the protection of exclusivity rights for the authors of computer software and registration thereof. The court recognized computer software as an intellectual work deserving copyright protection.

The court ruled that (i) the defendant had displayed an identical website to its users, without title to the relevant rights, and (ii) the defendant had copied the HTML coding of the website in question.

Based on these facts, the Court of Appeals concluded that (i) infringement had occurred, and (ii) a computer program is deemed to be a copy not only because it has the same function or purpose as another program, but also because of the way in which that function or purpose was obtained. A partial copy can constitute a counterfeit.

The court added that the defendant was guilty of a marketing infringement, since the plaintiff had paid for the software in order to obtain exclusivity in its commercial activities. The defendant's use of the software was intended to lure customers away from the plaintiff, and such business strategies should be discouraged.

For further information on this topic please contact Ricardo Barretto, Taìs Cristina Tesser or Luciana Freire Nordi at Barretto Ferreira, Kujawski, Brancher e Gonçalves – Sociedade de Advogados by telephone (+55 11 3066 5999) or by fax (+55 11 3167 4735) or by email ([email protected] or [email protected] or [email protected]).