English High Court Applies European Software Ruling in SAS v WPL
First appeared in Intellectual Property Magazine, 1 March 2013
SAS Institute Inc v World Programming Ltd  EWHC 69 (Ch)
The English High Court has dismissed a number of claims of copyright infringement brought by SAS Institute Inc against a rival developer (SAS Institute Inc v World Programming Ltd). Software proprietors and developers have followed the case closely through the English courts and all the way to the Court of Justice of the European Union (CJEU), since SAS's claim raised important questions about which elements of a computer program are protected by copyright, and which are not.
In a judgment on 25 January 2012, the High Court applied the CJEU ruling to SAS's claim and confirmed that copyright in a computer program:
- Does not protect the functionality of the computer program from being copied
- Does not prevent others from using the same programming language
- Does not protect data file formats (interfaces)
SAS owns the copyright in a software environment called Base SAS. SAS customers can use Base SAS to write and run applications in "SAS Language".
World Programming Limited ("WPL") developed a rival system – the World Programming System ("WPS") – that was capable of executing SAS applications. WPS emulated the functionality of the SAS system, producing the same outputs from the same inputs as the SAS system.
In developing WPS, WPL's developers did not have access to SAS source code. Instead, they studied and observed a "Learning Edition" of the SAS system. They also referred closely to SAS manuals, effectively using the manuals as a functional specification for WPS.
SAS claimed that WPL had infringed SAS copyright by:
- Copying the SAS manuals into WPL's manuals (this was the only part of SAS's claim that the High Court upheld)
- Copying a substantial part of the functionality of the SAS system
- Copying SAS manuals into the source code of WPL's competing system
- Indirectly copying SAS's Learning Edition.
The High Court's confirmation that copyright does not extend to the functionality of a computer program is welcome. The functionality of a computer program is essentially an "idea", and the law of copyright does not protect ideas; only the way in which ideas are expressed. Had the English courts extended copyright protection to functionality, this would have have had a serious impact on the development practices across the software industry, potentially stifling innovation and competition.
Studying a program to understand its functionality
Software licensees have an overriding right, under the EU Software Directive, to observe, study and test the functioning of a computer program in order to determine its underlying ideas and principles. It is now clear that software proprietors cannot use their licence terms to prevent a licensee from exercising this right. Even if the software licence restricts the purpose for which the licensee can use the software – for example, if the licence permits "non-commercial use" only – this will not curtail the licensee's right to observe and study the program. Moreover, the licensee can use the knowledge that it gains as a result to create a rival program.
Compilations of mathematical formulae, keywords, syntax etc
Software developers should review their development processes and ensure that their development teams are aware of the risks of using third party materials.
Copying a rival's source code will be infringing. Copying other third party materials – such as user manuals or design materials - could be infringing, depending on what is copied. For example, elements in a user manual that are not individually protected by copyright – such as mathematical formulae, keywords, syntax and options – could be protected by copyright when combined. This will depend on whether the compilation of these elements is "original" – or in the CJEU's words the "expression of the author's intellectual creation".
In this case, the High Court said that WPL had not infringed copyright in the SAS manuals when it produced WPS. Even if the statistical methods that WPL copied from the SAS manuals were a "compilation", they were not "original" because the authors of the SAS manual had copied them from the SAS system. In any case, the court said, the collection of statistical methods within the SAS system was not a "compilation" in the copyright sense. Formulae had been added to the SAS system, amended and supplemented over a long period of time without any formal design or plan.
Programming languages and interfaces
It is now clear that programming languages and data file formats are not protected by copyright as computer programs. However, last year's CJEU ruling left open the possibility that programming languages and data file formats might be protected by copyright as distinct "works" in their own right. It is a pity that the High Court ruling leaves this important question unanswered. SAS did not plead the point in time, and the Court refused to allow it to amend its claim late in the day.
Hamish Sandison is a Partner and Emily Parris is a Senior Associate (PSL) in the Technology & Outsourcing Group at Fieldfisher.