A Federal Court of Appeal in the US held last month that the breach of an open source software licence constituted copyright infringement. It is the first time that a senior US court has held that open source licence obligations are generally enforceable and that normal copyright rules apply to them.

Open source software is licensed in a very different way to traditional proprietary software. Generally, users are granted access to the source code of the software and given rights to amend and re-distribute it, subject to certain restrictions. Typical restrictions include the requirement to include appropriate copyright notices within the software and the obligation to make available, both to the original licensor and to other users, full details of any amendments made to the licensed software.

This case, Robert Jacobsen v Mathew Katzer and Kamind Associates Inc, concerned the Artistic Licence, one of a number of standard form open source licences in the market. The claimant, Robert Jacobsen, had created a program which allowed model railway enthusiasts to use a PC to control their model trains. He made the software available to users as an internet download, which was free of charge but subject to the terms of the Artistic Licence. The defendants, Mathew Katzer and Kamind Associates Inc, later used some of the material from Mr Jacobsen's software in a commercial product without adhering to the provisions of the Artistic Licence requiring attribution of the origins of the software and also the provision of a trackchanges version showing the changes made to it.

These facts were not disputed and the discussion in the US courts therefore centred around whether Katzer and Kamind's breach of the Artistic Licence conditions was a simple breach of contract or constituted infringement of copyright in Jacobsen's software.

Overturning a ruling of the District Court, the Court of Appeal held that the terms of the Artistic Licence were conditions of that licence and that breaking those conditions resulted in copyright infringement. Whilst the Court reiterated the position stated in a previous dispute involving Sun and Microsoft, that generally a copyright owner who has granted a non-exclusive licence to use a copyright material has waived his right to sue the licensee for copyright infringement and can only sue for breach of contract, it went on to find that if a licence is limited in scope and the licensee acts outside that scope, then the licensor can bring an action for copyright infringement.

One important point arising from the judgment was the Court's disagreement with the argument that copyright could not be infringed in a transaction where no money changed hands. The Court accepted that copyright is an economic right but held that there should be no presumption that there is no economic consideration in open source licensing merely because no money is exchanged. It was recognised that there are substantial benefits, including economic benefits, to the creation and distribution of copyright works under public licences. The Court listed generation of market share for the program in question and increase in national and international reputation by incubating open source projects as examples of such benefits.

This is an important finding in terms of establishing the nature and enforceability of open source licences and has been received with interest by the open source community.