The U.S. Court of Appeals for the Sixth Circuit reversed and remanded a preliminary injunction enjoining Static Control Components, Inc. (SCC) from selling its SMARTEK chip that enabled remanufacture of replacement laser printer toner cartridges. Lexmark Int’l, Inc. v. Static Control Components, Inc., Case No. 03-5400 (6th Cir. Oct. 26, 2004) (Sutton, J.). The Court of Appeals interpreted the Digital Millennium Copyright Act (DMCA) as preserving consumers’ rights to use purchased products for their intended purposes.
Lexmark manufactures printers and toner cartridges. Lexmark toner cartridges contain a microchip that communicates with the printer. If a code calculated by the microchip matches a code calculated by the printer the printer functions normally. If the two codes do not match, the printer will not allow use of the Printer Engine Program, which resides on the printer and controls a variety of printer functions, and, thus, the printer will not operate. The SCC SMARTEK chip, which includes an identical copy of Lexmark’s Toner Loading Program, breaks Lexmark’s “secret code” and permits third-party printing cartridge remanufacturers to recycle Lexmark toner cartridges as a low-cost alternative to new Lexmark toner cartridges. The Toner Loading Program is a short program that measures toner levels, while the Printer Engine Program is a much larger and complicated program.
Alleging three theories of liability, Lexmark brought suit against SCC seeking to enjoin SCC from distributing the SMARTEK chips. Lexmark claimed SCC infringed Lexmark’s copyright by copying the Toner Loading Program on the SMARTEK chips; violated the Digital Millennium Copyright Act, 17 U.S.C. § 1201(a)(2), by selling a product that circumvents access controls on the Toner Loading Program; and violated the DMCA by selling a product that circumvents access to the Printer Engine Program.
Reasoning the computer programs were literary works and entitled to copyright protection, the district court concluded Lexmark would likely prevail on the merits and issued a preliminary injunction. The court held the Toner Loading Program was not a “lock-out code,” and even if the Toner Loading Program were a lock-out code, copyright infringement had taken place because “[s]ecurity systems are just like any other computer program and are not inherently unprotectable.”
The Sixth Circuit found the district court committed three related legal errors in determining Lexmark had a likelihood of prevailing on its copyright claims with respect to the Toner Loading Program: 1) refusing to consider whether external factors such as compatibility requirements, industry standards and efficiency constrained the number of ways the Toner Loading Program could be written; 2) considering under the correct legal standard for distinguishing protectable expression from unprotectable ideas the constraints on the Toner Loading Program established by the evidence; and 3) concluding that the Toner Loading Program was not being used as a lock-out code.
Applying the doctrines of merger and scènes à faire, the Sixth Circuit reversed the district court. The Sixth Circuit reasoned the determining factor should be not whether any alternative ways of writing the program theoretically exist but whether such options were practical under the circumstances. The court found Lexmark failed to prove it was likely to prevail on its claim that the Toner Loading Program was protected by copyright, in light of evidence the Toner Loading Program was expressed in the most straightforward way and any substantial differences in the code, in light of the existing constraints, would be inefficient.
Noting if any single byte of the Toner Loading Program was altered, the printer would not function, the appellate court determined the Toner Loading Program also functioned as a lock-out code. Therefore, SCC’s use of the Toner Loading Program as a key to the lock-out function was a fair use dictated by functional compatibility requirements. The court rejected Lexmark’s claim that SCC could have discovered through reverse engineering ways to change the lock-out code, in light of evidence that the trial-and-error testing that would be required (without access to Lexmark secrets) would be computationally impossible.
Addressing Lexmark’s claims under the DMCA, the Sixth Circuit presumed the Printer Engine Program was protected by copyright. The court opined it was the purchase of a Lexmark printer that “controls access” to the Printer Engine Program, not Lexmark’s authentication program. The court explained that “effectively controlling access” under the DMCA referred to the prevention of access to the copyrightable expression (i.e., the code) of a copyrighted software program. Because Lexmark had not limited access to read and copy the Printer Engine Program but only prevented its use (which functions are not protected by copyright), Lexmark could not claim to have put in place a technological measure that effectively controls access to a protected work.
Considering the intent of the DMCA, the court supported its construction of “controls access” by noting that Congress enacted the DMCA to combat the threat of massive piracy of digital works due to the ease with which they could be copied and distributed. The court determined Congress did not intend to create liability for the circumvention of technological measures designed to prevent consumers from using consumer goods while leaving the copyrighted work unprotected. The decision comes soon after another case in which the U.S. Court of Appeal for the Federal Circuit held the anticircumvention provisions of the DMCA did not prevent the sale of replacement garage door openers. Chamberlain v. Skylink Technologies, Inc., Case No. 04-1118 (Fed. Cir. Aug. 31, 2004), discussed in IP Update (October 2004).