The anti-circumvention provision of the Digital Millennium Copyright Act, 17 U.S.C. § 1201, continues to challenge courts in the context of computer software. Section 1201(a)(1) prohibits “circumvent[ing] a technological measure that effectively controls access to a work protected under” Title 17. 17 U.S.C. § 1201(a)(1)(A). A recent decision of the Fifth Circuit Court of Appeals, relying on a 2004 Federal Circuit decision, holds that in this provision “access” means more than access.

In MGE UPS Systems, Inc. v. GE Consumer and Industrial, Inc. et al., No. 08-10521, 2010 WL 2820006 (5th Cir. July 20, 2010) (PDF), the court affirmed the district court’s dismissal of MGE’s claim that defendant Power Maintenance International, Inc., acquired by GE in 2001, violated § 1201 by circumventing an external hardware security key (a “dongle”) that enables and limits (with a password, an expiration date, and maximum number of uses) the use of software helpful for servicing MGE’s uninterruptible power supply machines. A group of employees of PMI, which services MGE machines, had acquired the unsecured MGE software from an unknown source after hackers had defeated the security key’s features, permitting unlimited use of the software.

Defendants admitted that the PMI employees had used the software on a number of occasions but argued that the DMCA had not been violated, because the dongle did not prevent copying of MGE’s software but only access to it, and once such access was obtained there was no technological obstacle to copying the software. The PMI employees had therefore not, defendants argued, engaged in the sort of “access” that § 1201 was designed to prevent. The court agreed, holding that “[t][he DMCA prohibits only forms of access that would violate or impinge on the protections that the Copyright Act otherwise affords copyright owners.” In doing so it followed the construction of § 1201(a)(1)(A) adopted in Chamberlin Group Inc. v. Skylink Technologies, Inc., 381 F.3d 1178 (Fed. Cir. 2004).

Under § 1201(a)(3)(A), applicable to § 1201(a), to “circumvent a technological measure” means “to descramble a scrambled work, to decrypt an encrypted work, or otherwise to avoid, bypass, remove, deactivate, or impair a technological measure, without the authority of the copyright owner,” and a technological measure “effectively controls access to a work” if “the measure, in the ordinary course of its operation, requires the application of information, or a process or a treatment, with the authority of the copyright owner, to gain access to the work.” The “antitrafficking provisions” of the DMCA distinguish between gaining access to a work and exercising rights of the copyright owner, for § 1201(a)(2) prohibits trafficking in any technology primarily designed or produced for the purpose of “circumventing a technological measure that effectively controls access to a work protected under” Title 17, whereas § 1201(b)(1) prohibits trafficking in any technology primarily designed or produced for the purpose of “circumventing protection afforded by a technological measure that effectively protects a right of a copyright owner under” Title 17. 17 U.S.C. §§ 1201(a)(2) & (b)(1) (emphases added.).

MGE argued that gaining “access” to a work means being able to view or use the work. The court rejected that meaning as too broad, since it “would permit liability under § 1201(a) for accessing a work simply to view it or use it within the purview of ‘fair use’ permitted under the Copyright Act.” Following the Federal Circuit in Chamberlin, the court concluded that the DMCA did not introduce a new property right (presumably referring to a right not to have a work viewed after circumvention of a technological measure), so there is no violation of § 1201(a) absent a “link between ‘access’ and ‘protection’ of the copyrighted work”: “The owner’s technological measure must protect the copyrighted material against infringement of a right that the Copyright Act protects, not from mere use or viewing.”

The court’s conclusion seems difficult to reconcile with the distinction in § 1201 between technological measures protecting access to a work and those protecting the rights of copyright owners and its prohibition of the circumvention only of technological measures protecting the former – a distinction made, as the Copyright Office’s December 1998 Summary of the DMCA noted, because unauthorized copying of a work may be fair use, but unauthorized access to it is not. Nonetheless, the court found that MGE’s dongle protected only access to its software but gave no further protection once access was obtained, so it did not protect against infringement of any rights of the copyright owner (by, for example, copying the unlicensed software). “Because the dongle does not protect against copyright violations, the mere fact that the dongle itself is circumvented does not give rise to a circumvention violation within the meaning of the DMCA.” (emphasis in original) The court buttressed its conclusion that § 1201(a)(1) had not been violated by noting that the section did not apply after a technological measure had been violated, and there was no evidence that any PMI or GE employee had circumvented the technological measure, as opposed to using the software after the dongle was circumvented by others. Accordingly, the court affirmed the district court’s dismissal of MGE’s DMCA claim.

Defendants were nonetheless liable for copyright infringement of the unlicensed unsecured software, and the jury had rendered an award for infringement as well as for misappropriation of trade secrets and unfair competition. However, the appellate court found that MGE had failed to prove damages from any of those violations and reversed the district court’s denial of defendants’ motion for judgment as a matter of law under Rule 50(a). The court did, however, affirm the district court’s grant of a permanent injunction against use of MGE’s software.

Copyright owners seeking to use technological measures to protect their software from unlicensed access should recognize that, despite the distinction made in Section 1201 between technological measures that protect access and those that protect a right of a copyright owner, courts following MGE UPS Systems and Chamberlin will not find a violation of that section in the circumvention of a technological measure that protects access to software without at the same time protecting the software against being used or copied, although it remains to be seen just how the two must be linked. Of course, a copyright owner may still rely on its remedies under the Copyright Act against unlicensed copying, but, as MGE UPS Systems also demonstrates, care must be taken in pursuing such remedies.