Posted: 10/19/1998

Assignment #6

I. The Agenda (Fact & Other Public Domain Works Cont'd)

This week we'll continue the topic we began two weeks ago, turning from the acquisition to the protection side. Next week we'll return to the acquisitions side extending the range of materials our hypothetical electronic publishers seek to include in their sports, restaurant sales, historic data collection. But for this week we'll stick with compiled sports statistics and other data our clients plan to gather from public domain sources and then sell via the Web and also, some of it, on CD-ROM.

Like ProCD our clients want to engage in price discrimination charging one sum for the single user and a much larger sum for institutional or commercial licensees. Their restaurant sales database, for example, they imagine selling both to individuals looking to buy or sell and to large brokers.

They are not worried about one year's database competing with the next year's because the degree of new data and the users' need to an up-to-date database should assure strong demand for the most recent version. But they do worry about individuals buying at the single user price and then sharing with others or, heaven forbid, putting the data on the Internet.

Before next week's CUSEEME class, I want each member of the class to prepare a short paragraph describing the key operative terms they would include in the "license" that should accompany the CD-ROM delivering the restaurant database to customers -- key terms and the legal effect they are intended to achieve. For example, should our clients characterize the transaction as a sale or something else, should the data be called software or something else. Our attention will be at least as much on the Copyright Act as on the contract law doctrine we saw operating in ProCD. Consider as well the extent to which you would use different license language for Web distribution of the same data.

Some of the legal questions underlying this assignment are these:

• What is the difference (in applicable law, consequences, or forum) between exceeding the bounds of a license that applies to copyright protected material and one that applies to unprotected material such as facts?
• Can public domain material be combined with copyright protected material in a way that the latter provides effective copyright protection for the former because of how it is licensed?
• Does it make any difference whether the licensee ends up owning the medium on which the data are delivered?
• In terms of the Copyright Act are "data" and "software" treated at all differently? If so, what is the critical definition?
• Do what extent can license terms alter the "fair use" zone created by § 107?

II. Readings

In addition to reviewing the Act itself with these questions in mind, see especially, §§ 101, 109, 117, and looking at the license on one or more disk-based digital products accessible to you I'd like you to read the following cases:

• DSC Communications Corp. v. DGI Technologies, Inc., 81 F.3d 597 (5th Cir. 1996) LEXIS | WESTLAW
• Triad Systems Corp. v. Southeastern Express, 64 F.3d 1330 (9th Cir. 1995) LEXIS | WESTLAW
• Mai Systems Corp. v. Peak Computer, 991 F.2d 511 (9th Cir. 1993) LEXIS | WESTLAW
• footnote 7 from Step-Saver Data Systems, Inc. v. Wyse Technology, 939 F.2d 91 (3d Cir. 1991)
• DSC Communications Corp. v. Pulse Communications Inc., 976 F. Supp. 359 (E.D. Va. 1997) LEXIS | WESTLAW
• Microsoft Corp. v. Harmony Computers & Electronics, Inc., 846 F. Supp. 208 (E.D.N.Y. 1994) LEXIS | WESTLAW

Not assigned but recommended as background reading is Mark A. Lemley, Intellectual Property and Shrinkwrap Licenses, 68 S. Cal. L. Rev. 1239 (1995) LEXIS | WESTLAW

III. How We'll Proceed

While I want you to decide on what license terms you would recommend, I'll not collect those recommendations. Instead, later in this week I'll post some proposed license terms in the Webboard conference for response.