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Tuesday, 29 January 2013

"Save Analytical Software"? That's not what SAS stands for ...

Another night could not be allowed to pass without this weblog recording a decision which crept up on this Kat without warning and which he feels a bit guilty about not having recorded earlier. The case in question is SAS Institute Inc v World Programming Ltd [2013] EWHC 69 (Ch), decided last Friday by Mr Justice Arnold, on the return of that case from its "holiday" in Luxembourg.

To remind readers of the facts, the following brief summary may be useful.  SAS developed its own SAS analytical software system, this being an integrated set of programs that let users perform a wide range of data-processing and other tasks -- especially statistical analysis. The SAS software had been in use for some 35 years, generating income of more than £2 billion. At its heart was "Base SAS", which let users write and run application programs ("scripts"), written in SAS language, in order to manipulate their data.

Base SAS's functionality could be extended by using additional components -- in this case SAS/ACCESS, SAS/GRAPH and SAS/STA. Over the years, SAS's customers had created thousands of apps in the SAS Language. Some of these apps were short and simple, while others were vast. Anyone wanting to run their existing apps or create new ones had to take a licence to the SAS components. Other suppliers of analytical software existed in the market, but anyone wanting to change to another software would have to rewrite all its apps in another language, which would be a pain (and an expensive one, too).

World Programming, having recognised the huge potential market for software to execute SAS-based apps for use elsewhere, developed its own World Programming System (WPS) -- which inevitably emulated much of the functionality of SAS's components in order to ensure that they worked the same. It was not alleged that World Programming had access to SAS's source code or copied it, or even that it copied any of the structural design of the components' source code. World Programming also created a WPS manual, which described the functionality of various elements briefly by reference to syntax diagrams, plus a set of WPS guides --four quick reference guides which simply listed elements of the SAS language and indicated whether the current edition of WPS supported it.

In September 2009 SAS commenced proceedings, alleging copyright infringement in its software and in its own manuals, as well as breach of SAS's licence terms with regard to the Learning Edition of the SAS System.  In July 2010 Arnold J, hearing the case, referred a series of questions to the Court of Justice of the European Union for a preliminary ruling.  After the Advocate General gave his Opinion and the CJEU pronounced its ruling, back came the case for Arnold J to finish off.

Mr Justice Arnold offered  SAS only a small crumb of comfort, rejecting all its copyright infringement claims except for that relating to the copying of the SAS manual in WPS Manual -- which he had already established to be the case back in 2010.

* First, he declared that the CJEU's answer to the first five questions amounted to an endorsement of Pumfrey J's interpretation of Article 1(2) of the Software Directive ("Protection in accordance with this Directive shall apply to the expression in any form of a computer program. Ideas and principles which underlie any element of a computer program, including those which underlie its interfaces, are not protected by copyright under this Directive") in Navitaire Inc v easyJet Airline Co Ltd.  Basically this means that copyright in a computer program protects neither the programming language in which it is written nor its interfaces and functionality. This in turn means that World Programming had not infringed copyright in the SAS components by producing WPS.

* He then rejected the argument that the SAS language was in itself a work that was its author's own intellectual creation and thus protectable under the Information Society Directive. Based on the evidence which was adduced at trial, and a general understanding of the position, the court's provisional view was that a programming language such as the SAS Language was not capable of being a work [Told you so, says the IPKat to a number of people who have been arguing with him on this point].

* In any event SAS could not assert that the SAS language was a copyright work in its own right without an amendment to its particulars of claim -- and no such amendment should be permitted at such a late stage of the proceedings. To allow it would be to raise new factual and legal issues for investigation.

* The position of SAS's data file formats was no different to that of of the SAS language.

* It could not be said that World Programming had reproduced the expression of the intellectual creation of the author of the SAS manuals, whether by producing or testing WPS.

* Further, the use by World Programming of the SAS Learning Edition fell within Article 5(3) of the Software Directive ("The person having a right to use a copy of a computer program shall be entitled, without the authorisation of the right­ holder, to observe, study or test the functioning of the program in order to determine the ideas and principles which underlie any element of the program if he does so while performing any of the acts of loading, displaying, running, transmitting or storing the program which he is entitled to do"), and none of World Programming's actions was a breach of the licence contract or an infringement of copyright.

This weary Kat hopes he has got the case right. He knows that he will hear from lots of readers if he hasn't.


Japser said...

Time for a new home; they may want to sell their
castle in the Netherlands to pay their legal expenses...

> In any event SAS could not assert that the SAS language was a copyright work in its own right without an amendment to its particulars of claim -- and no such amendment should be permitted at such a late stage of the proceedings. To allow it would be to raise new factual and legal issues for investigation.

Pity. If they would have filed a claim with such particulars, it would have been an even more interesting case.

Ken Moon said...

I support your view. It is not the function of copyright to protect software functionality (pun intended). Only a patent should do that, if allowable.

The New Zealand High Court in Fisher & Paykel v Karum has very recently followed Arnold J's first judgment in the SAS case and Pumphrey J's judgment in Navitaire.

Joseph Saviri said...

Good summary Jeremy and thoughtful points from Japser and Moon - am intrigued though. Would re-drafting particulars delay or lead to a qualification of the principles?

Anonymous said...

While I don't disagree that the decision says that a language or file format is not itself capable of being a copyright work (and that also fits with my gut feeling on what "ought" to be the legal situation), on my initial reading it did seem that it would be possible to define a language or file format the use of which would necessarily infringe copyright. This is because there seems to be nothing to stop an element of the language/format attracting copyright; the decision just says that assembling sets of elements doesn't lead to the assemblage (i.e. language/format) being a work itself.

To give a simple example for a file format, take a copyright work - e.g. a paragraph of prose you've made up - and then define your file format so that all files in that format necessarily begin with that copyright of work. As far as I can see, it must then be the case that any program that produces data files of that format necessarily infringes copyright in the paragraph. (Reading such files might not necessarily infringe, I suppose.)

An example for a programming language is more contrived, but take an essential command/function, and make the "word" for it the copyright work above. It's then going to be pretty tricky at best to write something that is able to use that language, without having a copy of the copyright work in the code somewhere in order to identify when it's being used (and what about the manual?).

As I say, the programming language point is very contrived and unlikely to arise in practice - no one is going to use a language which requires them to write a paragraph of text when they need to use a common command. But data file formats are invisible to an end user, so there may well not be any particular downside to embedding a short copyright work within those ...

Anonymous said...

Yet another example of an English Court referring a case to Luxembourg and then taking the judgment of the Europeam Court and finding reasons to hold that the European Court agreed with them all along and any previous English case law.

An interesting point of procedure is raised by the judgment. As the European Court has absolute jurisdiction to make findings of law even if not specifically argued in the particulars of claim before or even referred by the national court, it seems that those findings can be ingnored when the case returns to the national court (on the basis that they were not argued or evidence adduced)even where the findings of the European Court can affect the outcome of the case.

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