SPREADSHEET PROGRAM'S MENU COMMANDS ARE NOT PROTECTABLE:
U.S. SUPREME COURT AFFIRMS LOTUS v. BORLAND
By Carol Anne Been and Ronald S. Bell(1)
Sonnenschein Nath & Rosenthal
Chicago, Illinois
The United States Supreme Court recently voted 4-4 to affirm a First Circuit Court of Appeals decision holding that Lotus Development Corporation ("Lotus") cannot copyright the menu commands in its popular Lotus 1-2-3 spreadsheet software. Lotus Development Corp. v. Borland Int'l, Inc., 116 S.Ct. 804, reh'g denied 116 S.Ct. 1062 (1996). Although widely expected to clarify the scope of copyright protection in this closely-watched area, the justices wrote no opinion. Justice Stevens recused himself without explanation.
Plaintiff Lotus, newly under the control of International Business Machines, is the nation's No. 3 software manufacturer, with reported revenues of $971 million in 1994. Its Lotus 1-2-3 spreadsheet helped propel the sale of personal computers in the 1980s and retains more than a third of the spreadsheet market. Defendant Borland International, Inc. ("Borland"), a Lotus competitor, markets the Quattro Pro line of software.
In the lawsuit, Borland admitted to copying from Lotus 1-2-3 some 469 commands, arranged in more than 50 menus, into Quattro Pro. Borland defended its copying by claiming that spreadsheet users familiar with the Lotus program would not need to learn new commands to operate Borland's Quattro Pro spreadsheet product. While Borland did not copy Lotus's computer code, it acknowledged mimicking the 1-2-3 command hierarchy purely for commercial reasons, rather than as a technical necessity.
At trial, the district court held that Borland's copying constituted infringement of Lotus' protectable copyright and permanently enjoined distribution of Quattro Pro. The district court found that the choice and arrangement of commands on Lotus's menus were protected by copyright because competitors could create innumerable different menus and command hierarchies to operate their own programs. Lotus Development Corp. v. Borland Int'l, Inc., 799 F. Supp. 203 (D.Mass 1992).
On appeal, Borland argued that the menu command hierarchy could not be protected because it was a "method of operation" foreclosed by the Copyright Act:
In no case does copyright protection for an original work of authorship extend to any idea, procedure, process, system, method of operation, concept, principle, or discovery, regardless of the form in which it is described, explained, illustrated, or embodied in such work.
17 U.S.C. 102(b). Borland also claimed that the facts of its case resembled Baker v. Selden, 101 U.S. 99 (1879), the landmark Supreme Court decision which denied copyright protection to a system of grids printed on a bookkeeping form. In Baker, the Court held that Selden's copyright in a book containing those forms gave him no copyright interest in the bookkeeping system which employed the forms. Borland contended that the user interface in Lotus was like the system of forms in Baker -- unprotectable by copyright.
The First Circuit Court of Appeals rejected the comparison to Baker, noting that Lotus claimed a monopoly over spreadsheet commands, not an accounting "system." However, the First Circuit found the "method of operation" argument dispositive. Lotus Development Corp. v. Borland Int'l, Inc., 49 F.3d 807 (1st Cir. 1995). It compared the menu command hierarchy in Lotus's software to the buttons which control and operate videocassette recorders. Although manufacturers may arrange and label these buttons, that does not make them a protectable "expression," the court said; on the contrary, the buttons themselves would constitute an uncopyrightable "method of operation" even though they contain expressive elements.
Because the Lotus case involved deliberate and literal copying, the First Circuit also declined to follow the abstraction-filtration-comparison test set forth in Computer Associates Int'l, Inc. v. Altai, Inc., 982 F.2d 693 (2d Cir. 1992), which the Second Circuit has applied to identify copyright infringement in cases involving non-literal copying. See also Gates Rubber Co. v. Bando Chem. Indus., Ltd., 9 F.3d 823 (10th Cir. 1993) (endorsing the Altai test for assessing whether software menus are copyrightable). In Altai, the Second Circuit described software as possessing an "essentially utilitarian nature" which must be considered to determine whether copyright infringement has occurred. 982 F.2d at 704. By contrast, in Lotus, the court noted that the fundamental issue was not whether copying had occurred but whether menu displays could be copyrighted at all.
The Supreme Court, by its affirmance without opinion, accepted the First Circuit decision and with it Borland's argument that it would be "absurd" if manufacturers who gained copyright monopolies on the arrangement of software controls could thereby force users to learn new controls for every program. However, the First Circuit did not reject the idea that patent law could protect such uncopyrightable processes and methods. Therefore, this case leaves open the possibility of patent protection for software which "controls" or "operates" a computer system.
With the affirmance of the First Circuit decision, competitors who are "second-comers" now
may copy the "operational" elements of existing computer software to make their programs
compatible with the copied software for the convenience of their users without fear of
incurring copyright infringement liability. However, it may be difficult to predict which, if
any, other elements of software may be held unprotectable in the future as being
"operational" dispute their expressive features. Further, whether the outcome of Lotus will
discourage software developers from striving to lead, rather than follow, the market remains
to be seen.
©1996 American Bar Association. All Rights Reserved.
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