District Court Finds Failure to Demonstrate Circumvention of a Technological Measure in DMCA Claim Involving User Detection Feat

Plaintiff Auto Inspection Services, Inc. (“AIS”) owns the copyright to an automotive inspection program (“AIS’s Program”) that contains a quality control feature designed to track unauthorized use of the program. Defendants Flint Auto Auction, Inc., Inviso, Inc., and Priority Inspections, Inc. (collectively “FAA”) are in the automotive inspection business. FAA obtained a non-exclusive license of AIS’s Program to perform inspection of cars for GMAC in 2003. When an alleged unauthorized user attempted to use FAA’s license for AIS’s Program in 2004, AIS terminated FAA’s license. AIS alleged that FAA continued to make use of AIS’s Program in violation of copyrights following termination of their license. FAA claimed that they hired Technical Edge to independently develop a program (“FAA’s Program”) that complied with GMAC’s requirements and accomplished the same functions as AIS’s Program.

AIS alleged copyright infringement and violation of the Digital Millennium Copyright Act (“DCMA”) in seeking a preliminary injunction against FAA. The Court focused on copying as a matter of fact and copying as a matter of law to address the copyright infringement claim. In the analysis of copying as a factual matter, the Court found little direct or circumstantial evidence demonstrating that FAA had access to AIS’s Program source code through accessibility features on FAA computers or through FAA or Technical Edge employees. The Court also found no evidence that the alleged infringing software was substantially similar to AIS’s Program given that FAA’s software was written in a different computer language and relied on independent sources. Because both programs were designed to meet industry needs and were written in conformance with GMAC’s functionality requirements, the Court found it likely that the programs would have similar screen displays and use similar terminology. The Court further discounted testimony by AIS’s President that the speed of FAA’s program development indicated copying—relying instead on the testimony of Technical Edge’s programmer.

In assessing copying as a matter of law, the Court emphasized that “[t]he doctrines of merger, scenes a faire, and public domain limit the portions of the Program that are protected.” The Court again found FAA’s evidence credible and compelling—particularly testimony that FAA’s Program was written in a different language drawn from stock sources and that “other external factors such as efficiency, hardware standards, compatibility requirements, and ease of use seriously limit the ways in which vehicle inspection software can be written.” The Court concluded that AIS failed to demonstrate substantial similarity of the programs by failing to provide evidence from “a person with specialized knowledge in computer programming” and by failing to break down AIS’s Program into its constituent parts for comparison with FAA’s Program.

The DCMA states that “‘no person shall circumvent a technological measure that effectively controls access to a work protected under this title.’” Although the Court found little evidence that FAA had access to AIS’s Program source code, it proceeded to determine whether a user detection feature that alerted AIS to users of AIS’s Program constituted a technological measure that “controls access to a protected work.” A technological measure effectively controls access to a work “‘if the measure in the ordinary process of its operation, requires the application of information or a process or a treatment…to gain access to the work.’” Because AIS’s Program user detection feature is part of AIS’s Program itself, does not prevent access to the protected work (i.e., to the source code), and only functions after a user has already performed an inspection, the Court found it “questionable” that AIS’s Program user detection feature met the requirement for control of access under the DMCA.

Notwithstanding the issue of controlled access, the Court further assessed whether FAA circumvented a technological measure to gain access to AIS’s Program. Circumventing a technological measure “means ‘to descramble a scrambled work, to decrypt an encrypted work, or otherwise bypass, remove, deactivate, or impair a technological measure.” The Court found no evidence of access to or modification of AIS’s Program source code by FAA. Although AIS argued that ceasing to receive information from FAA indicated circumvention of AIS’s Program user detection function, the Court found that this observation could have also resulted from FAA’s independent creation of a separate program. Because the user detection feature did not function to control access to AIS’s Program source code and because AIS failed to demonstrate that FAA even gained access to AIS’s Program source code, the Court found that AIS failed to show a strong likelihood of success under the DMCA claim.

In concluding the analysis for preliminary injunction, the Court found that AIS was not entitled to a presumption of irreparable harm given the “weak showing” for copyright infringement. The Court further found that AIS’s lost business could not be linked to unauthorized use of AIS’s Program by FAA and that AIS failed to demonstrate a risk of FAA concealing or destroying evidence. The Court also noted the fact that AIS waited over two years to seek a TRO. In contrast, the Court weighed heavily the harm that would befall FAA if they were unable to perform a software update required by GMAC on the day following the hearing—resulting in FAA being unable to provide inspections for GMAC. The Court therefore dissolved a TRO against FAA and denied AIS’s motion for a preliminary injunction.

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