John

This is a well written letter, informative and well thought out. No emotion

and no personal attacks.

Had your posts to this list been more along these lines you may not have

created so many enemies.

Jerry Cotton, MCP

(252)466-4854 mailto:cottonjp@2mawcp.usmc.mil

Custom software. Fast, Cheap, Reliable...Choose two.

> -----Original Message-----

> From: John V. Petersen [mailto:John.V.Petersen@comcast.net]

> Sent: Friday, May 02, 2003 8:15 AM

> To: John@interactionlaw.com

> Cc: profox@leafe.com

> Subject: Commentary on your article: Microsoft Risks

> Copyright Impotence

>

>

> Mr. Mitchell..

>

> In your article entitled "Microsoft Risks Copyright Impotence",

> http://interactionlaw.com/interactionlaw/id12.html you cited a case. I

> would like to share some commentary with you.

>

> Lasercomb America, Inc. v. Reynolds, (911 F.2d 970) (1990)

>

> According to your article, this case stands for the proposition that

> copyright owner cannot enforce its copyright while at the same time,

> engaging in misuse. I agree that this is the holding of the case.

> However, it begs the question of what is defined as

> "copyright misuse".

> Based on the Lasercomb's facts, there was a software vendor

Mr. Mitchell..

In your article entitled "Microsoft Risks Copyright Impotence",

http://interactionlaw.com/interactionlaw/id12.html you cited a case. I

would like to share some commentary with you.

Lasercomb America, Inc. v. Reynolds, (911 F.2d 970) (1990)

According to your article, this case stands for the proposition that

copyright owner cannot enforce its copyright while at the same time,

engaging in misuse. I agree that this is the holding of the case.

However, it begs the question of what is defined as "copyright misuse".

Based on the Lasercomb's facts, there was a software vendor (plaintiff)

and a steel die manufacturer (defendant) who copied the software

vendor's software. The plaintiff sued for damages and the defendant

proffered an affirmative defense - that a copyright owner cannot enforce

its copyright when it is engaged in misuse of that copyright. The

offending language of the EULA stated that no licensee could create

their own CAD/CAM die-making software. The court agreed that this was

overly broad. The Lasercomb cites another case: Compton v. Metal

Products, Inc., 453 F.2d 38 (4th Cir.1971) in which the court held that

a license to use a patent required the licensee to not engage in certain

businesses.

Clearly, the facts of this case are distinguishable since MS is not

restricting the rights of people to develop their own software that

could in effect, compete with MS. Specifically, there is nothing in the

VFP EULA that states that a licensee is prohibited from developing

software that would compete with VFP. Further, MS is not saying that you

cannot run VFP on a non-MS OS.

Also, it is important to note that while the 4th Circuit is a step below

the Supreme Court, the case is only binding on the 4th. Circuit. Many of

your readers I am sure are non-lawyers and may not realize that fact.

Further, it bears emphasizing that the 11th. Circuit has failed to adopt

the rule in Lasercomb Bellsouth Advertising & Pub. Corp. v. Donnelley

Information Pub., Inc., 933 F.2d 952. Further, it also bears noting that

MS has already been involved in a case that applied Lasercomb. Microsoft

Corp. v. BEC Computer Co., Inc., 818 F.Supp. 1313. In this central

district of CA case, the court distinguished MS's license terms from

those in Lasercomb.

In my opinion, the properly framed question is this: Does requiring

difference licenses for different operating systems constitute misuse of

copyright?

Further, because your argument contains a threshold issue, specifically

the legal standards for what constitutes mis-use of copyright, you were

compelled to discuss that issue to determine if mis-use occurred in this

case. If the answer is no, the Lasercomb Case becomes inapplicable. On

the substantive issue, MS prevailed in that case. Specifically, MS's

licensing agreements were found to not offend public policy or

anti-trust law.

Mr. Mitchell, software vendors are entitled to earn a return on their

investment. Just because a software vendor decides to draw a line

between where you can distribute royalty free and where you have to pay

a license fee, that does not create a prima facie case of copyright

mis-use.

John V. Petersen

Rutgers University School of Law-Camden Campus - 3L

Visual Foxpro Developer

this list passim:

The 8 EULA has explicit language that says you can only distribute the

runtimes on Windows... < JVP >

...again

The EULA requires simultaneous running of the Windows platform with the

redistributables...< JVP >

actually: "in conjuction with" (conjuction n. the condition of being

joined) - AndyD

...but now:

MS is not saying that you cannot run VFP on a non-MS OS. < JVP >

I note, I offer no comment**, I am after all only an idiot programmer who

writes freaking emulators!

**other than to say that if the apparant contradiction is supposed to be

explained by:

The limitation does not mention the VFP Dev environment...< JVP >

then am I the only person who believes that "design, develop and test"

*specifically* does not include "run"?

AndyD <sorry!> 8-)#

**********************************************************************

This email and any files transmitted with it are confidential and

intended solely for the use of the individual or entity to whom they

are addressed. If you have received this email in error please notify

the system manager.

This footnote also confirms that this email message has been swept

for the presence of computer viruses.

Please contact internet.administrators@notes.manchester.gov.uk

with any queries.

John,

Thank you very much for this real contribution to our world.

As you point out, other opinions - notably Microsoft's - are on the table,

but from the sounds of your argument and your research, the law may well

come to our (and as you also point out, our customer's) rescue here.

Here's hoping that VFP is helping you in some way now, and more so in the

future.

Bill

> On May 2, John Peterson took issue with my article at

> http://interactionlaw.com/interactionlaw/id12.html (Microsoft Risks

> Copyright Impotence). As a student of the law, he was apparently

> unimpressed by the fact that I cited only one case in support of my

> position. On Sunday, Mr. Peterson sent a terse e-mail chiding my

> failure to respond. I do so now, with apologies to non-lawyers for the

> length and the legalese.

...

John

John,

Thank you for spending the time to going into such detail.

Are you a lawyer that sometimes works with VFP, or a VFPer that sometimes

practices law?

Anthony

----- Original Message -----

From: "John T. Mitchell" <John@InteractionLaw.com>

On May 2, John Peterson took issue with my article at

http://interactionlaw.com/interactionlaw/id12.html (Microsoft Risks

Copyright Impotence). As a student of the law, he was apparently

unimpressed by the fact that I cited only one case in support of my

position. On Sunday, Mr. Peterson sent a terse e-mail chiding my

failure to respond. I do so now, with apologies to non-lawyers for the

length and the legalese.

.....

Greetings Mr. Mitchell,

Thank you, twice over. First for the detailed explanation of your

reasoning, and second for helping "all" of us who are not (yet) in the legal

profession to better understand the value of a polished attorney with the

level of experience you bring to the table. Further, knowing you offered

your insights while "not on the meter" makes your response all the more

appreciated.

My father, a physician, once told me there are many levels of competence and

incompetence in any profession. That pointedly included the medical and

legal professions. It is refreshing to hear from one of the "competent

ones", as opposed to the babbling of a wanna-be, gonna-be someday, 1-2-3

Look At Me, knock-off.

With respect to the computer industry, I find those who profess themselves

to be "know all, be all, experts", and speak loudly and boldly in excess,

are often those who understand far less than they know. It is as though

brutality somehow offsets an obvious lack of understanding. I am certain

that holds true for any profession.

The real trick to my successes has come in large part in acknowledging I do

not know or understand all there is to my trade, hence always being alert to

soaking up additional information to better myself. Sharing back with

purpose is equally important. I do know when to turn to folks more

experienced than I, and whose opinions I respect and trust. It is the ones

who are constantly on the attack, rather than trying to help their

professional community grow in understanding, that I opt to not listen to.

It is within this contextual spirit that I read the background "message" of

your dissertation, whether such "message" was intentional or not. I choose

to believe you to be intentionally clever enough to get your point across

amidst the explanation you offered. I am certain this is not lost upon

others.

Well done. And certainly performed more diplomatically than warranted. You

are a gentleman indeed.

Gil

Gilbert M. Hale

New Freedom Data Resources

Pittsford, NY

585-359-8085

gil@gilhale.com

> -----Original Message-----

> From: profox-bounces@leafe.com [mailto:profox-bounces@leafe.com]On

> Behalf Of John T. Mitchell

> Sent: Monday, May 05, 2003 12:51 AM

> To: profox@leafe.com

> Cc: 'John V. Petersen'

> Subject: RE: Commentary on your article: Microsoft Risks Copyright

> Impotence

>

>

> On May 2, John Peterson took issue with my article at

> http://interactionlaw.com/interactionlaw/id12.html (Microsoft Risks

> Copyright Impotence). As a student of the law, he was apparently

> unimpressed by the fact that I cited only one case in support of my

> position. On Sunday, Mr. Peterson sent a terse e-mail chiding my

> failure to respond. I do so now, with apologies to non-lawyers for the

> length and the legalese.

>

> Mr. Peterson seeks to re-frame the question as “Does requiring

> difference licenses for different operating systems constitute misuse of

> copyright?” What Mr. Peterson fails to appreciate is that when

> Microsoft purports to license a particular use, it must be a use it has

> a right to license. In this case, Microsoft is attempting to license

> the private performance of its works, but that’s like me licensing

> people to use the sidewalk in front of my house. I may find people

> willing to pay, but that does not mean I have the right to license such

> use, nor that anyone who walks along the sidewalk without paying me is

> doing anything illegal. The law doesn’t change just because I happen to

> be Microsoft and say “you can only use my software if you promise to not

> walk on the sidewalk in front of Bill gates’ house.”

>

> Of crucial importance here is the fact that no one – not even a thief or

> a pirate – can infringe upon any of the exclusive rights of a copyright

> owner by making a non-public performance of a work. Copyright owners

> enjoy an exclusive right to perform a work publicly, but have no right

> to exclude anyone from performing a work privately. Twentieth Century

> Music Corp. v. Aiken, 422 U.S. 151, 155 (1975). A few years earlier,

> the Supreme Court had explained: “The Copyright Act does not give a

> copyright holder control over all uses of his copyrighted work.

> Instead, [Section 106] of the Act enumerates several ‘rights’ that are

> made ‘exclusive’ to the holder of the copyright. If a person, without

> authorization from the copyright holder, puts a copyrighted work to a

> use within the scope of one of these ‘exclusive rights,’ he infringes

> the copyright. If he puts the work to a use not enumerated in [Section

> 106], he does not infringe.” Fortnightly Corp. v. United Artists

> Television, Inc., 392 U.S. 390, 393-95 (1968) (footnotes omitted).

>

> In his dissent in the Betamax case (where the videocassette recorder

> survived a legal challenge), Justice Blackmun explained: “Section

> 106(4) grants a copyright owner the exclusive right to perform the work

> ‘publicly,’ but does not afford the owner protection with respect to

> private performances by others. A motion picture is ‘performed’

> whenever its images are shown or its sounds are made audible. § 101.

> Like ‘[singing] a copyrighted lyric in the shower,’ Twentieth Century

> Music Corp. v. Aiken, 422 U.S. 151, 155 (1975), watching television at

> home with one's family and friends is now considered a performance.

> Home television viewing nevertheless does not infringe any copyright –

> but only because § 106(4) contains the word ‘publicly.’” (Sony Corp. of

> America v. Universal City Studios, Inc., 464 U.S. 417, 468-69 (1984),

> Blackmun, J., dissenting (footnotes and citations omitted).) And you

> can watch those programs on the television of your own choosing!

>

> The private performance of a lawfully reproduced copy of Microsoft

> software is not an infringement of any of the exclusive rights of the

> copyright holder, and Microsoft may not use its exclusive rights to gain

> control over the public’s rights. “A copyright owner may not enforce

> its copyright to . . . use it in any manner violative of the public

> policy embodied in the grant of a copyright.” Tricom, Inc. v. Electronic

> Data Systems Corp., 902 F. Supp. 741 (E.D. Mich. 1995) (citations

> omitted). Leveraging copyright power to control behavior which Congress

> intended remain outside of the copyright owner’s control is the type of

> conduct condemned in United States v. Paramount Pictures, Inc., 334 U.S.

> 131 (1948); Morton Salt Co. v. G.S. Suppiger Co., 314 U.S. 488 (1942);

> Motion Picture Patents Co. v. Universal Film Mfg. Co., 243 U.S. 502

> (1917), and Lasercomb Am., Inc. v. Reynolds, 911 F.2d 970 (4th Cir.

> 1990).

>

> The public policy granting copyrights “excludes from it all that is not

> embraced” in the original copyrighted work, and “equally forbids the use

> of the copyright to secure an exclusive right or limited monopoly”

> beyond the scope of the Copyright Act and which is “contrary to public

> policy to grant.” (Lasercomb America, Inc. v. Reynolds, 911 F.2d 970,

> 977 (4th Cir. 1990) (quoting with revisions from Morton Salt, 314 U.S.

> at 492) (brackets omitted).) Mr. Peterson has suggested that this

> Fourth Circuit decision is not good enough, so I have relied more on

> Supreme Court cases. Let’s see a little more of where the Supreme Court

> stands.

>

> In 1917, the Supreme Court took on the issue of private enlargement of

> copyright in the Motion Picture Patents case. It determined that the

> owner of an intellectual property monopoly – in that case a patented

> motion picture film projector – could not lawfully use a “licensing”

> mechanism like Microsoft is using to obligate purchasers of the machine

> to use it solely with motion pictures containing another patent which

> the company also owned. (Motion Picture Patents Co. v. Universal Film

> Mfg Co., 243 U.S. 502.) On page 519, the court stated: “A restriction

> which would give to the plaintiff such a potential power for evil over

> an industry which must be recognized as an important element in the

> amusement life of the nation . . . is plainly void, because wholly

> without the scope and purpose of our patent laws, and because, if

> sustained, it would be gravely injurious to that public interest, which

> we have seen is more a favorite of the law than is the promotion of

> private fortunes.” This position was followed in Carbice Corp. of Am.

> v. Am. Patents Dev. Corp., 283 U.S. 27 (1931) (owner of a patented

> package that used solid carbon dioxide could not obligate licensees to

> use its own solid carbon dioxide).

>

> The relevance of the Supreme Court’s analysis in Motion Picture Patents

> Co. is inescapable. If it is unlawful to extend the statutory monopoly

> by limiting the use of a patented motion picture projector to films

> containing other intellectual property owned by the licensor, then it

> stands to reason that it is equally unlawful to license only on

> condition that it not be used in conjunction with an operating system of

> choice.

>

> In Morton Salt Co. v. G.S. Suppiger Co., 314 U.S. 488 (1942), the

> Supreme Court examined the use of the patent monopoly in a machine for

> depositing salt tablets to force licensees to use only salt tablets

> manufactured by the patent holder. The court said: “The public policy

> which includes inventions within the granted monopoly excludes from it

> all that is not embraced in the invention. It equally forbids the use

> of the patent to secure an exclusive right or limited monopoly not

> granted by the Patent Office and which it is contrary to public policy

> to grant. (Id. at 492.)

>

> And this line of reasoning is not limited to patent and trademark law.

> Morton Salt itself noted with approval the application of this doctrine

> to copyrights. (Id. at 494.) In United States v. Paramount Pictures,

> Inc., 334 U.S. 131 (1948), the Supreme Court further explained the

> limitations on copyright power in the context of “block booking” – “the

> practice of licensing, or offering for license, one feature or group of

> features on condition that the exhibitor will also license another

> feature or group of features released by the distributors during a given

> period.” (Id. at 156.) Like patent law, the exclusive right granted

> under the Copyright Act does not include any privilege to “add to the

> monopoly of the copyright in violation of the principle of the patent

> cases involving tying clauses.” (Id. at 158.)

>

> >From these foundations, the doctrine of copyright misuse has developed

> both as a violation of antitrust law and as an affirmative defense

> against copyright infringement when the copyright holder, by means of an

> over-reaching license or other method of control, tries “to secure an

> exclusive right or limited monopoly not granted by the [Copyright]

> Office and which it is contrary to public policy to grant.” (Lasercomb

> Am., Inc. v. Reynolds, 911 F.2d 970, 976 (4th Cir. 1990), quoting from

> Morton Salt, 314 U.S. at 491.) Moreover, copyright misuse is such a

> violation of public policy that some courts will not require that the

> person against whom the misuse is directed be a party to the litigation.

> “[T]he fact that appellants here were not parties to one of Lasercomb’s

> standard license agreements is inapposite to their copyright misuse

> defense.” Lasercomb, 911 F.2d at 979.)

>

> United States courts have a long history of recognizing that licensing

> terms which have the purpose and effect of voiding the boundary around

> the exclusive rights of the copyright holder, thereby enlarging the

> copyright holder’s universe of control, constitute misuse of copyrights

> and should be void as against public policy. The same should be true

> where EULAs are used to the same end. “Sound policy rationales support

> the analysis of those courts that have found shrinkwrap licenses to be

> unenforceable. A system of ‘licensing’ which grants software publishers

> this degree of unchecked power to control the market deserves to be the

> object of careful scrutiny.” (Softman Prods. Co. v. Adobe Sys., Inc.,

> 171 F. Supp. 2d 1075, 1091 (C.D. Cal. 2001).) The Softman court was

> quite critical of Adobe’s efforts to compel third-parties to relinquish

> the rights they enjoy under the Copyright Act through use of an end-user

> license agreement – in that case, a “license” that purported to make the

> third party waive its rights under Section 109 to resell lawfully made

> copies without Adobe’s consent. “The Court finds that the provisions

> contained in Adobe’s EULA purport to diminish the rights of customers to

> use the software in ways ordinarily enjoyed by customers under copyright

> law. Therefore, these restrictions appear to be inconsistent with the

> balance of rights set forth in intellectual property law.” (Id. at 1090

> (footnote omitted).)

>

> Indeed, a contrary result would be untenable, for it would manage “to

> transform a contractual term that software purveyors unilaterally

> include in their contracts into a binding provision on the world – even

> on parties who are not in privity of contract – and one that, moreover,

> undoes the dictates of Congress by undermining an essential feature of

> the Copyright Act!” 2 M. Nimmer & D. Nimmer, NIMMER ON COPYRIGHT §

> 8.12[B][1][d][i] (2002) (exclamation point in original).

>

> The United States is not alone in this. In the United Kingdom, the

> Commission on Intellectual Property Rights recently concluded that

> “Where suppliers of digital information or software attempt to restrict

> ‘fair use’ rights by contract provisions associated with the

> distribution of digital material, the relevant contract provisions may

> be treated as void.” (Commission on Intellectual Property Rights,

> Integrating Intellectual property Rights and Development Policy:

> Executive Summary, September 2002, at 22.)

>

> In Australia, the Copyright Law Review Committee recommends that the

> Australian Copyright Act “be amended to provide that an agreement, or a

> provision of an agreement, that excludes or modifies, or has the effect

> of excluding or modifying, the operation of [certain limitations upon

> the rights of copyright holders] has no effect.” (Recommendation 7.49,

> Copyright Law review Committee, Copyright and Contract, Commonwealth of

> Australia 2002.)

>

> It is not my custom to go into this much detail when I’m not “on the

> meter,” but I feel deeply that it is not just developers who may lose

> out if these bogus licenses are allowed to prevail. It is also the

> public, that stands to gain from the innovative new works and uses

> created by the developers, who would suffer as well. But one

> disclaimer: Mr. Peterson will likely soon be licensed to practice law,

> and he obviously has an opinion different from mine, so don’t take this

> as legal advice – check with a lawyer whose judgment you trust before

> thumbing your nose at an offensive EULA.

>

> John

> __________________

> John T. Mitchell

> http://interactionlaw.com

>

>

> -----Original Message-----

> From: John V. Petersen [mailto:John.V.Petersen@comcast.net]

> Sent: Friday, May 02, 2003 8:15 AM

> To: John@interactionlaw.com

> Cc: profox@leafe.com

> Subject: Commentary on your article: Microsoft Risks Copyright Impotence

>

> <snip>

>

>

[excessive quoting removed by server]

On May 2, John Peterson took issue with my article at

http://interactionlaw.com/interactionlaw/id12.html (Microsoft Risks

Copyright Impotence). As a student of the law, he was apparently

unimpressed by the fact that I cited only one case in support of my

position. On Sunday, Mr. Peterson sent a terse e-mail chiding my

failure to respond. I do so now, with apologies to non-lawyers for the

length and the legalese.

Mr. Peterson seeks to re-frame the question as "Does requiring

difference licenses for different operating systems constitute misuse of

copyright?" What Mr. Peterson fails to appreciate is that when

Microsoft purports to license a particular use, it must be a use it has

a right to license. In this case, Microsoft is attempting to license

the private performance of its works, but that's like me licensing

people to use the sidewalk in front of my house. I may find people

willing to pay, but that does not mean I have the right to license such

use, nor that anyone who walks along the sidewalk without paying me is

doing anything illegal. The law doesn't change just because I happen to

be Microsoft and say "you can only use my software if you promise to not

walk on the sidewalk in front of Bill gates' house."

Of crucial importance here is the fact that no one - not even a thief or

a pirate - can infringe upon any of the exclusive rights of a copyright

owner by making a non-public performance of a work. Copyright owners

enjoy an exclusive right to perform a work publicly, but have no right

to exclude anyone from performing a work privately. Twentieth Century

Music Corp. v. Aiken, 422 U.S. 151, 155 (1975). A few years earlier,

the Supreme Court had explained: "The Copyright Act does not give a

copyright holder control over all uses of his copyrighted work.

Instead, [Section 106] of the Act enumerates several 'rights' that are

made 'exclusive' to the holder of the copyright. If a person, without

authorization from the copyright holder, puts a copyrighted work to a

use within the scope of one of these 'exclusive rights,' he infringes

the copyright. If he puts the work to a use not enumerated in [Section

106], he does not infringe." Fortnightly Corp. v. United Artists

Television, Inc., 392 U.S. 390, 393-95 (1968) (footnotes omitted).

In his dissent in the Betamax case (where the videocassette recorder

survived a legal challenge), Justice Blackmun explained: "Section

106(4) grants a copyright owner the exclusive right to perform the work

'publicly,' but does not afford the owner protection with respect to

private performances by others. A motion picture is 'performed'

whenever its images are shown or its sounds are made audible. § 101.

Like '[singing] a copyrighted lyric in the shower,' Twentieth Century

Music Corp. v. Aiken, 422 U.S. 151, 155 (1975), watching television at

home with one's family and friends is now considered a performance.

Home television viewing nevertheless does not infringe any copyright -

but only because § 106(4) contains the word 'publicly.'" (Sony Corp. of

America v. Universal City Studios, Inc., 464 U.S. 417, 468-69 (1984),

Blackmun, J., dissenting (footnotes and citations omitted).) And you

can watch those programs on the television of your own choosing!

The private performance of a lawfully reproduced copy of Microsoft

software is not an infringement of any of the exclusive rights of the

copyright holder, and Microsoft may not use its exclusive rights to gain

control over the public's rights. "A copyright owner may not enforce

its copyright to . . . use it in any manner violative of the public

policy embodied in the grant of a copyright." Tricom, Inc. v. Electronic

Data Systems Corp., 902 F. Supp. 741 (E.D. Mich. 1995) (citations

omitted). Leveraging copyright power to control behavior which Congress

intended remain outside of the copyright owner's control is the type of

conduct condemned in United States v. Paramount Pictures, Inc., 334 U.S.

131 (1948); Morton Salt Co. v. G.S. Suppiger Co., 314 U.S. 488 (1942);

Motion Picture Patents Co. v. Universal Film Mfg. Co., 243 U.S. 502

(1917), and Lasercomb Am., Inc. v. Reynolds, 911 F.2d 970 (4th Cir.

1990).

The public policy granting copyrights "excludes from it all that is not

embraced" in the original copyrighted work, and "equally forbids the use

of the copyright to secure an exclusive right or limited monopoly"

beyond the scope of the Copyright Act and which is "contrary to public

policy to grant." (Lasercomb America, Inc. v. Reynolds, 911 F.2d 970,

977 (4th Cir. 1990) (quoting with revisions from Morton Salt, 314 U.S.

at 492) (brackets omitted).) Mr. Peterson has suggested that this

Fourth Circuit decision is not good enough, so I have relied more on

Supreme Court cases. Let's see a little more of where the Supreme Court

stands.

In 1917, the Supreme Court took on the issue of private enlargement of

copyright in the Motion Picture Patents case. It determined that the

owner of an intellectual property monopoly - in that case a patented

motion picture film projector - could not lawfully use a "licensing"

mechanism like Microsoft is using to obligate purchasers of the machine

to use it solely with motion pictures containing another patent which

the company also owned. (Motion Picture Patents Co. v. Universal Film

Mfg Co., 243 U.S. 502.) On page 519, the court stated: "A restriction

which would give to the plaintiff such a potential power for evil over

an industry which must be recognized as an important element in the

amusement life of the nation . . . is plainly void, because wholly

without the scope and purpose of our patent laws, and because, if

sustained, it would be gravely injurious to that public interest, which

we have seen is more a favorite of the law than is the promotion of

private fortunes." This position was followed in Carbice Corp. of Am.

v. Am. Patents Dev. Corp., 283 U.S. 27 (1931) (owner of a patented

package that used solid carbon dioxide could not obligate licensees to

use its own solid carbon dioxide).

The relevance of the Supreme Court's analysis in Motion Picture Patents

Co. is inescapable. If it is unlawful to extend the statutory monopoly

by limiting the use of a patented motion picture projector to films

containing other intellectual property owned by the licensor, then it

stands to reason that it is equally unlawful to license only on

condition that it not be used in conjunction with an operating system of

choice.

In Morton Salt Co. v. G.S. Suppiger Co., 314 U.S. 488 (1942), the

Supreme Court examined the use of the patent monopoly in a machine for

depositing salt tablets to force licensees to use only salt tablets

manufactured by the patent holder. The court said: "The public policy

which includes inventions within the granted monopoly excludes from it

all that is not embraced in the invention. It equally forbids the use

of the patent to secure an exclusive right or limited monopoly not

granted by the Patent Office and which it is contrary to public policy

to grant. (Id. at 492.)

And this line of reasoning is not limited to patent and trademark law.

Morton Salt itself noted with approval the application of this doctrine

to copyrights. (Id. at 494.) In United States v. Paramount Pictures,

Inc., 334 U.S. 131 (1948), the Supreme Court further explained the

limitations on copyright power in the context of "block booking" - "the

practice of licensing, or offering for license, one feature or group of

features on condition that the exhibitor will also license another

feature or group of features released by the distributors during a given

period." (Id. at 156.) Like patent law, the exclusive right granted

under the Copyright Act does not include any privilege to "add to the

monopoly of the copyright in violation of the principle of the patent

cases involving tying clauses." (Id. at 158.)

>From these foundations, the doctrine of copyright misuse has developed

both as a violation of antitrust law and as an affirmative defense

against copyright infringement when the copyright holder, by means of an

over-reaching license or other method of control, tries "to secure an

exclusive right or limited monopoly not granted by the [Copyright]

Office and which it is contrary to public policy to grant." (Lasercomb

Am., Inc. v. Reynolds, 911 F.2d 970, 976 (4th Cir. 1990), quoting from

Morton Salt, 314 U.S. at 491.) Moreover, copyright misuse is such a

violation of public policy that some courts will not require that the

person against whom the misuse is directed be a party to the litigation.

"[T]he fact that appellants here were not parties to one of Lasercomb's

standard license agreements is inapposite to their copyright misuse

defense." Lasercomb, 911 F.2d at 979.)

United States courts have a long history of recognizing that licensing

terms which have the purpose and effect of voiding the boundary around

the exclusive rights of the copyright holder, thereby enlarging the

copyright holder's universe of control, constitute misuse of copyrights

and should be void as against public policy. The same should be true

where EULAs are used to the same end. "Sound policy rationales support

the analysis of those courts that have found shrinkwrap licenses to be

unenforceable. A system of 'licensing' which grants software publishers

this degree of unchecked power to control the market deserves to be the

object of careful scrutiny." (Softman Prods. Co. v. Adobe Sys., Inc.,

171 F. Supp. 2d 1075, 1091 (C.D. Cal. 2001).) The Softman court was

quite critical of Adobe's efforts to compel third-parties to relinquish

the rights they enjoy under the Copyright Act through use of an end-user

license agreement - in that case, a "license" that purported to make the

third party waive its rights under Section 109 to resell lawfully made

copies without Adobe's consent. "The Court finds that the provisions

contained in Adobe's EULA purport to diminish the rights of customers to

use the software in ways ordinarily enjoyed by customers under copyright

law. Therefore, these restrictions appear to be inconsistent with the

balance of rights set forth in intellectual property law." (Id. at 1090

(footnote omitted).)

Indeed, a contrary result would be untenable, for it would manage "to

transform a contractual term that software purveyors unilaterally

include in their contracts into a binding provision on the world - even

on parties who are not in privity of contract - and one that, moreover,

undoes the dictates of Congress by undermining an essential feature of

the Copyright Act!" 2 M. Nimmer & D. Nimmer, NIMMER ON COPYRIGHT §

8.12[B][1][d][i] (2002) (exclamation point in original).

The United States is not alone in this. In the United Kingdom, the

Commission on Intellectual Property Rights recently concluded that

"Where suppliers of digital information or software attempt to restrict

'fair use' rights by contract provisions associated with the

distribution of digital material, the relevant contract provisions may

be treated as void." (Commission on Intellectual Property Rights,

Integrating Intellectual property Rights and Development Policy:

Executive Summary, September 2002, at 22.)

In Australia, the Copyright Law Review Committee recommends that the

Australian Copyright Act "be amended to provide that an agreement, or a

provision of an agreement, that excludes or modifies, or has the effect

of excluding or modifying, the operation of [certain limitations upon

the rights of copyright holders] has no effect." (Recommendation 7.49,

Copyright Law review Committee, Copyright and Contract, Commonwealth of

Australia 2002.)

It is not my custom to go into this much detail when I'm not "on the

meter," but I feel deeply that it is not just developers who may lose

out if these bogus licenses are allowed to prevail. It is also the

public, that stands to gain from the innovative new works and uses

created by the developers, who would suffer as well. But one

disclaimer: Mr. Peterson will likely soon be licensed to practice law,

and he obviously has an opinion different from mine, so don't take this

as legal advice - check with a lawyer whose judgment you trust before

thumbing your nose at an offensive EULA.

John

__________________

John T. Mitchell

http://interactionlaw.com

-----Original Message-----

From: John V. Petersen [mailto:John.V.Petersen@comcast.net]

Sent: Friday, May 02, 2003 8:15 AM

To: John@interactionlaw.com

Cc: profox@leafe.com

Subject: Commentary on your article: Microsoft Risks Copyright Impotence

<snip>

Hi Anthony,

I am neither. I cannot (nor have I done so here) practice law. However,

I can provide commentary (just as you can) such as I am doing here. I

can and will write a law review article on this.

I am a VFP developer who goes to law school and has an intense interest

in the areas of IP/Copyrights.

< JVP >

<<

John,

Thank you for spending the time to going into such detail.

Are you a lawyer that sometimes works with VFP, or a VFPer that

sometimes

practices law?

Anthony

<<

Mr. Mitchell,=20

Thanks for the reply. One quick point, my last name is Petersen, not

Peterson. Not a big deal but I thought I would point it out nonetheless.

With respect to my critique of your article, it had nothing to do with

the fact that you cited only one case. Rather, I took issue with the

fact that the facts of that case are easily distinguishable from the

facts at hand. Further, in the one MS case that attempted to apply

Lasercomb to a MS EULA, MS won the substantive issues in that case.=20

As I see it, your argument is that MS is misusing its copyright because

it seeks to expand the reach of the copyright beyond what Congress

intended. Specifically, your contention is that MS is violating the

boundaries between public and private use. This begs the following

questions:

1. What differentiates between public and private use?

2. In the facts at hand, do we have a public or private use?

3. Once classified, do the facts at hand constitute mis-use of

copyright?

I am going to take a few days to research the SCOTUS jurisprudence you

have cited, but at the outset, I want to share a few comments. As far

as the law is concerned, I question how much on-point case law is

available. Copyright/Anti-Trust law and the case law in my opinion, has

lagged behind the technology curve for far too long. This is one of the

reasons I decided to go to law school.=20

I don't consider people that work in the commercial sector, deploying

applications (consultants) to be working in the private arena or to be

private actors. On the other hand, if I wanted to conduct research in

private and not for financial gain, I would indeed agree that this would

constitute a "private performance".=20

A good example is a DVD - which would enjoy the protections of

copyright. As a private actor, I should be allowed to burn a copy for

myself in case the original gets damaged or in the case of protecting

the original. Here, I am acting completely in private. However, if I

started making multiple copies and handed them out to my friends, I

think you and I, and everyone else would agree that this would be a

violation of copyright. Further, consider the case of me inviting 10

friends over to watch a DVD. Again, I am a private actor here and it is

none of the copyright owner's business what I am doing. On the other

hand, charging admission at the door to allow people to watch the movie

could be a problem. On the other hand, if I rented the DVD at

Blockbuster and wanted folks to chip in (assuming I was really cheap!!)

- I could do that. Further, if it were a pay-per-view event and a group

of us wanted to split the costs, we could do that. Ultimately, it is a

mixed bag and the law needs to catch up to the digital age.

Comparing to this context, if I want to tinker around to see if I can

get the royalty free distributables to work in Linux, I don't see the

harm in that. I am in the private context and MS should not care.

Well...MS may care but I don't think there is much that could be done

about it. On the other hand, If I want to enter the stream of commerce

and start selling that solution, then that is another matter altogether.

No longer am I acting privately. Here Mr. Mitchell is where I see your

private vs. pubic argument falling apart.

I do agree that there are affirmative limits on how far software vendors

can reach in their EULA's. For example, placing anti-competitive

language that would run afoul of anti-trust laws would be impermissible.

This is essentially what the holding of the Lasercomb Case stands for. I

also agree that EULA's have played fast and loose at times with the

first amendment (the absence of the State Action Doctrine

notwithstanding). Like any contract, EULA's have to be fair, not against

the law, and further, not against public policy. My disagreement with

your position is that what MS seeks to do here is not against the law,

is fair, and does not offend public policy. This was the essntial

holding in Lasercomb - non-analogous scnenario nothwithstanding.

I believe there are some important facts here that you are not aware of.

In these facts, there are two components. First, there is the Visual

FoxPro development environment. Every developer is allowed to install it

on one and only one machine. If MS were to limit this aspect of the EULA

to only Windows - I would agree that this would be impermissible. Many

people are running Office under Linux today and MS apparently does not

have a problem with that. MS rang the register with the sale of the box

- so that should be the end of the story. With Visual FoxPro and for

that matter, with .NET and MSDE, OLE-DB, etc. there is royalty free

distribution. To date, I have only read the VFP and .NET EULA's. And, as

far as the royalty-free distributable is concerned, those can only be

run on the Windows platform. It is important to note that MS is under no

obligation to offer royalty free distribution in the first place and

could end support for that tomorrow. As I see it, Windows subsidizes

this effort. And, if that subsidy is not present, MS has the right to

require payment in the form of a royalty fee. Others have attempted to

make a product tying argument here. That analogy does not apply since

the end user has alternatives. As has been stated before, people wishing

to purchase the full development version of Visual FoxPro and run that

on Linux may do so and in turn, would be in compliance with the EULA.=20

A company that spends $5 BILLION annually on Research and Development

and that employs over 100K people world wide is entitled to realize a

return on the fruits of it labor. I agree that how a company goes about

realizing that return must do so within the boundaries of the law

(copyright, anti-trust, etc.). It is good for the company, the

employees, the stockholders, and perhaps most importantly, it is good

for our country and the economy.=20

For what its worth, I believe that if the DCMA had been in effect in

1980, the software industry would not be where or what it is today.

However, it is not 1980 anymore and given the investment dollars at

stake, clearly the rules have to be different. A lot of parralels can be

drawn between the software industry and other technologies when they

were in the early stages of their life-cycles. I don't agree with

everything software vendors try to do, but for the most part, I am in

their camp.=20

Best regards - and lastly, I do appreciate the opportunity to discuss

and debate the issue with a lawyer...

I'll be in touch...

< JVP >

-----Original Message-----

From: John T. Mitchell [mailto:John@InteractionLaw.com]=20

Sent: Monday, May 05, 2003 12:51 AM

To: profox@leafe.com

Cc: 'John V. Petersen'

Subject: RE: Commentary on your article: Microsoft Risks Copyright

Impotence

On May 2, John Peterson took issue with my article at

http://interactionlaw.com/interactionlaw/id12.html (Microsoft Risks

Copyright Impotence). As a student of the law, he was apparently

unimpressed by the fact that I cited only one case in support of my

position. On Sunday, Mr. Peterson sent a terse e-mail chiding my

failure to respond. I do so now, with apologies to non-lawyers for the

length and the legalese.

Mr. Peterson seeks to re-frame the question as =93Does requiring

difference licenses for different operating systems constitute misuse of

copyright?=94 What Mr. Peterson fails to appreciate is that when

Microsoft purports to license a particular use, it must be a use it has

a right to license. In this case, Microsoft is attempting to license

the private performance of its works, but that=92s like me licensing

people to use the sidewalk in front of my house. I may find people

willing to pay, but that does not mean I have the right to license such

use, nor that anyone who walks along the sidewalk without paying me is

doing anything illegal. The law doesn=92t change just because I happen =

to

be Microsoft and say =93you can only use my software if you promise to =

not

walk on the sidewalk in front of Bill gates=92 house.=94=20

Of crucial importance here is the fact that no one =96 not even a thief =

or

a pirate =96 can infringe upon any of the exclusive rights of a =

copyright

owner by making a non-public performance of a work. Copyright owners

enjoy an exclusive right to perform a work publicly, but have no right

to exclude anyone from performing a work privately. Twentieth Century

Music Corp. v. Aiken, 422 U.S. 151, 155 (1975). A few years earlier,

the Supreme Court had explained: =93The Copyright Act does not give a

copyright holder control over all uses of his copyrighted work. Instead,

[Section 106] of the Act enumerates several =91rights=92 that are made

=91exclusive=92 to the holder of the copyright. If a person, without

authorization from the copyright holder, puts a copyrighted work to a

use within the scope of one of these =91exclusive rights,=92 he =

infringes

the copyright. If he puts the work to a use not enumerated in [Section

106], he does not infringe.=94 Fortnightly Corp. v. United Artists

Television, Inc., 392 U.S. 390, 393-95 (1968) (footnotes omitted). =20

In his dissent in the Betamax case (where the videocassette recorder

survived a legal challenge), Justice Blackmun explained: =93Section

106(4) grants a copyright owner the exclusive right to perform the work

=91publicly,=92 but does not afford the owner protection with respect to

private performances by others. A motion picture is =91performed=92

whenever its images are shown or its sounds are made audible. =A7 101.

Like =91[singing] a copyrighted lyric in the shower,=92 Twentieth =

Century

Music Corp. v. Aiken, 422 U.S. 151, 155 (1975), watching television at

home with one's family and friends is now considered a performance. Home

television viewing nevertheless does not infringe any copyright =96 but

only because =A7 106(4) contains the word =91publicly.=92=94 (Sony =

Corp. of

America v. Universal City Studios, Inc., 464 U.S. 417, 468-69 (1984),

Blackmun, J., dissenting (footnotes and citations omitted).) And you

can watch those programs on the television of your own choosing! =20

The private performance of a lawfully reproduced copy of Microsoft

software is not an infringement of any of the exclusive rights of the

copyright holder, and Microsoft may not use its exclusive rights to gain

control over the public=92s rights. =93A copyright owner may not =

enforce

its copyright to . . . use it in any manner violative of the public

policy embodied in the grant of a copyright.=94 Tricom, Inc. v. =

Electronic

Data Systems Corp., 902 F. Supp. 741 (E.D. Mich. 1995) (citations

omitted). Leveraging copyright power to control behavior which Congress

intended remain outside of the copyright owner=92s control is the type =

of

conduct condemned in United States v. Paramount Pictures, Inc., 334 U.S.

131 (1948); Morton Salt Co. v. G.S. Suppiger Co., 314 U.S. 488 (1942);

Motion Picture Patents Co. v. Universal Film Mfg. Co., 243 U.S. 502

(1917), and Lasercomb Am., Inc. v. Reynolds, 911 F.2d 970 (4th Cir.

1990).

The public policy granting copyrights =93excludes from it all that is =

not

embraced=94 in the original copyrighted work, and =93equally forbids the =

use

of the copyright to secure an exclusive right or limited monopoly=94

beyond the scope of the Copyright Act and which is =93contrary to public

policy to grant.=94 (Lasercomb America, Inc. v. Reynolds, 911 F.2d 970,

977 (4th Cir. 1990) (quoting with revisions from Morton Salt, 314 U.S.

at 492) (brackets omitted).) Mr. Peterson has suggested that this

Fourth Circuit decision is not good enough, so I have relied more on

Supreme Court cases. Let=92s see a little more of where the Supreme =

Court

stands. =20

In 1917, the Supreme Court took on the issue of private enlargement of

copyright in the Motion Picture Patents case. It determined that the

owner of an intellectual property monopoly =96 in that case a patented

motion picture film projector =96 could not lawfully use a =

=93licensing=94

mechanism like Microsoft is using to obligate purchasers of the machine

to use it solely with motion pictures containing another patent which

the company also owned. (Motion Picture Patents Co. v. Universal Film

Mfg Co., 243 U.S. 502.) On page 519, the court stated: =93A =

restriction

which would give to the plaintiff such a potential power for evil over

an industry which must be recognized as an important element in the

amusement life of the nation . . . is plainly void, because wholly

without the scope and purpose of our patent laws, and because, if

sustained, it would be gravely injurious to that public interest, which

we have seen is more a favorite of the law than is the promotion of

private fortunes.=94 This position was followed in Carbice Corp. of Am.

v. Am. Patents Dev. Corp., 283 U.S. 27 (1931) (owner of a patented

package that used solid carbon dioxide could not obligate licensees to

use its own solid carbon dioxide).

The relevance of the Supreme Court=92s analysis in Motion Picture =

Patents

Co. is inescapable. If it is unlawful to extend the statutory monopoly

by limiting the use of a patented motion picture projector to films

containing other intellectual property owned by the licensor, then it

stands to reason that it is equally unlawful to license only on

condition that it not be used in conjunction with an operating system of

choice.

In Morton Salt Co. v. G.S. Suppiger Co., 314 U.S. 488 (1942), the

Supreme Court examined the use of the patent monopoly in a machine for

depositing salt tablets to force licensees to use only salt tablets

manufactured by the patent holder. The court said: =93The public policy

which includes inventions within the granted monopoly excludes from it

all that is not embraced in the invention. It equally forbids the use

of the patent to secure an exclusive right or limited monopoly not

granted by the Patent Office and which it is contrary to public policy

to grant. (Id. at 492.)

And this line of reasoning is not limited to patent and trademark law.

Morton Salt itself noted with approval the application of this doctrine

to copyrights. (Id. at 494.) In United States v. Paramount Pictures,

Inc., 334 U.S. 131 (1948), the Supreme Court further explained the

limitations on copyright power in the context of =93block booking=94 =96 =

=93the

practice of licensing, or offering for license, one feature or group of

features on condition that the exhibitor will also license another

feature or group of features released by the distributors during a given

period.=94 (Id. at 156.) Like patent law, the exclusive right granted

under the Copyright Act does not include any privilege to =93add to the

monopoly of the copyright in violation of the principle of the patent

cases involving tying clauses.=94 (Id. at 158.)

>From these foundations, the doctrine of copyright misuse has developed

both as a violation of antitrust law and as an affirmative defense

against copyright infringement when the copyright holder, by means of an

over-reaching license or other method of control, tries =93to secure an

exclusive right or limited monopoly not granted by the [Copyright]

Office and which it is contrary to public policy to grant.=94 =

(Lasercomb

Am., Inc. v. Reynolds, 911 F.2d 970, 976 (4th Cir. 1990), quoting from

Morton Salt, 314 U.S. at 491.) Moreover, copyright misuse is such a

violation of public policy that some courts will not require that the

person against whom the misuse is directed be a party to the litigation.

=93[T]he fact that appellants here were not parties to one of =

Lasercomb=92s

standard license agreements is inapposite to their copyright misuse

defense.=94 Lasercomb, 911 F.2d at 979.)

United States courts have a long history of recognizing that licensing

terms which have the purpose and effect of voiding the boundary around

the exclusive rights of the copyright holder, thereby enlarging the

copyright holder=92s universe of control, constitute misuse of =

copyrights

and should be void as against public policy. The same should be true

where EULAs are used to the same end. =93Sound policy rationales =

support

the analysis of those courts that have found shrinkwrap licenses to be

unenforceable. A system of =91licensing=92 which grants software =

publishers

this degree of unchecked power to control the market deserves to be the

object of careful scrutiny.=94 (Softman Prods. Co. v. Adobe Sys., Inc.,

171 F. Supp. 2d 1075, 1091 (C.D. Cal. 2001).) The Softman court was

quite critical of Adobe=92s efforts to compel third-parties to =

relinquish

the rights they enjoy under the Copyright Act through use of an end-user

license agreement =96 in that case, a =93license=94 that purported to =

make the

third party waive its rights under Section 109 to resell lawfully made

copies without Adobe=92s consent. =93The Court finds that the =

provisions

contained in Adobe=92s EULA purport to diminish the rights of customers =

to

use the software in ways ordinarily enjoyed by customers under copyright

law. Therefore, these restrictions appear to be inconsistent with the

balance of rights set forth in intellectual property law.=94 (Id. at =

1090

(footnote omitted).)=20

Indeed, a contrary result would be untenable, for it would manage =93to

transform a contractual term that software purveyors unilaterally

include in their contracts into a binding provision on the world =96 =

even

on parties who are not in privity of contract =96 and one that, =

moreover,

undoes the dictates of Congress by undermining an essential feature of

the Copyright Act!=94 2 M. Nimmer & D. Nimmer, NIMMER ON COPYRIGHT =A7

8.12[B][1][d][i] (2002) (exclamation point in original).=20

The United States is not alone in this. In the United Kingdom, the

Commission on Intellectual Property Rights recently concluded that

=93Where suppliers of digital information or software attempt to =

restrict

=91fair use=92 rights by contract provisions associated with the

distribution of digital material, the relevant contract provisions may

be treated as void.=94 (Commission on Intellectual Property Rights,

Integrating Intellectual property Rights and Development Policy:

Executive Summary, September 2002, at 22.)

In Australia, the Copyright Law Review Committee recommends that the

Australian Copyright Act =93be amended to provide that an agreement, or =

a

provision of an agreement, that excludes or modifies, or has the effect

of excluding or modifying, the operation of [certain limitations upon

the rights of copyright holders] has no effect.=94 (Recommendation =

7.49,

Copyright Law review Committee, Copyright and Contract, Commonwealth of

Australia 2002.) =20

It is not my custom to go into this much detail when I=92m not =93on the

meter,=94 but I feel deeply that it is not just developers who may lose

out if these bogus licenses are allowed to prevail. It is also the

public, that stands to gain from the innovative new works and uses

created by the developers, who would suffer as well. But one

disclaimer: Mr. Peterson will likely soon be licensed to practice law,

and he obviously has an opinion different from mine, so don=92t take =

this

as legal advice =96 check with a lawyer whose judgment you trust before

thumbing your nose at an offensive EULA.

John

__________________

John T. Mitchell

http://interactionlaw.com

-----Original Message-----

From: John V. Petersen [mailto:John.V.Petersen@comcast.net]=20

Sent: Friday, May 02, 2003 8:15 AM

To: John@interactionlaw.com

Cc: profox@leafe.com

Subject: Commentary on your article: Microsoft Risks Copyright Impotence

<snip>

>>It is not my custom to go into this much detail when I’m not “on the

meter,” but I feel deeply that it is not just developers who may lose

out if these bogus licenses are allowed to prevail. It is also the

public, that stands to gain from the innovative new works and uses

created by the developers, who would suffer as well.

<JVP swipe removed :)>

Great reply. All of his talk about on the meter, I'd guess he was an

attorney.

Stephen Russell

S.R. & Associates

Memphis TN 38115

901.246-0159

-----Original Message-----

From: profox-bounces@leafe.com [mailto:profox-bounces@leafe.com]On

Behalf Of John T. Mitchell

Sent: Sunday, May 04, 2003 11:51 PM

To: profox@leafe.com

Cc: 'John V. Petersen'

Subject: RE: Commentary on your article: Microsoft Risks Copyright

Impotence