FEDERAL PROSECUTION OF
VIOLATIONS OF INTELLECTUAL
PROPERTY RIGHTS

(COPYRIGHTS, TRADEMARKS AND TRADE SECRETS)


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II.     THE PROTECTION OF COPYRIGHTS





A.     INTELLECTUAL PROPERTY ENTITLED TO COPYRIGHT PROTECTION



The substantive copyright laws are codified in Title 17 of the United States Code, which sets forth requirements and procedures for obtaining copyrights. Copyright protection only extends to certain types of property, defined by statute and subject to constitutional limitations. These constitutional and statutory constraints are discussed below.



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1.     Historical Grounds for Copyright Protection




The Constitution gives Congress the power to enact laws designed "[t]o Promote the Progress of Science and Useful Arts, (9) by securing for Limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries." U.S. CONST. art. I, § 8, cl. 8. The first Copyright Act that Congress passed under this power only protected "books," "maps" and "charts." See Act of May 31, 1790, ch. 15, 1 Stat. 124. The Supreme Court has since made it clear, however, that Congress' constitutional authority in the area extends well beyond written works to other media. As the Court has noted, this authority is not defined in a "narrow literal sense but, rather, with the reach necessary to reflect the broad scope of constitutional principles." Goldstein v. California, 412 U.S. 546, 561 (1973). Thus, the term "Author," in its constitutional sense, has been read to denote an "originator," or one "to whom anything owes its origin." Id. (quoting Burrow-Giles Lithographic Co. v. Sarony, 111 U.S. 53, 58 (1884)). Similarly the word "writings" has been construed broadly "to include any physical rendering of the fruits of creative intellectual or aesthetic labor." Id. Thus, Congress' constitutional authority to establish copyrights reaches all tangible media of artistic expression, including photographs, motion pictures and sound recordings. See Goldstein, 412 U.S. at 562 n.17. Congress has exercised this authority, providing federal copyright protection to an increasingly broad range of intellectual properties. See Goldstein v. California, 412 U.S. 546, 562 n.17 (1973).

Congress initially relied upon civil sanctions to protect copyrights. Beginning in 1909, however, Congress also imposed criminal penalties for certain types of copyright infringement. See Act of March 4, 1909, ch. 28, 35 Stat. 1082. Adopting a "step-by-step, carefully considered approach," Congress has gradually expanded the role of federal law enforcement in this field. Dowling v. United States, 473 U.S. 207, 225 (1985).(10)

Prior to 1976, copyrights were protected in this country through a dual system. The federal government provided limited statutory rights for intellectual property, while state statutory and common laws established roughly equivalent protection for a range of intellectual properties. This dual system was, quite accurately, characterized as "anachronistic, uncertain, impractical, and highly complicated." H.R. Rep. No. 1476, 94th Cong., 2d Sess. 1, 130, reprinted in 1976 U.S. Code Cong. & Admin. News, 5659, 5745 (1976). Under this system, federal statutory copyright protection differed from common law copyrights, and state statutory and common law copyrights varied from jurisdiction to jurisdiction.

In 1976, Congress fundamentally changed this system by introducing a single preemptive federal statute. 17 U.S.C. § 301. (11) "Section 301 in effect establishes a two-pronged test to be applied in preemption cases." Crow v. Wainwright, 720 F.2d 1224, 1225 (11th Cir. 1983), cert. denied, 469 U.S. 819 (1984). See also Daboub v. Gibbons, 42 F.3d 285 (5th Cir. 1995); Rosciszewski v. Arete Associates, Inc., 1 F.3d 225 (4th Cir. 1993). Under this preemption test, the states are precluded from enforcing penalties for copyright violations if (1) the intellectual property at issue falls within the "subject matter of copyright" as defined by federal law and

(2) the claimed property rights are "equivalent to" the exclusive rights provided by federal copyright law. Wainwright, 720 F.2d at 1225-26. The copyright act now precludes state criminal prosecutions for acts of copyright infringement. In all instances criminal prosecution for a copyright violation is possible only within the federal system.

In recent years, Congress has significantly broadened the scope of federal copyright protection. Federal law now protects artistic expression fixed on new types of media. For example, federal copyright protection now extends to sound recordings, computer software, and other forms of electronic data. See 17 U.S.C. §§ 102(a)(7), 117; see also Apple Computer, Inc. v. Franklin Computer Corp., 714 F.2d 1240, 1246-49 (3d Cir. 1983), cert. denied, 464 U.S. 1033 (1984). Video games are also now entitled to federal copyright protection. See Atari Games Corp. v. Oman, 888 F.2d 878 (D.C. Cir. 1989); United States v. O'Reilly, 794 F.2d 613, 614 (11th Cir. 1986) (citing Midway Mfg. Co. v. International Inc., 704 F.2d 1009 (7th Cir.), cert. denied, 464 U.S. 823 (1983)); Williams Elecs, Inc. v. Arctic Int'l., Inc., 685 F.2d 870, 873-74 (3d Cir. 1982).

Finally, Congress has acted to significantly enhance criminal penalties. The penalties for criminal infringement of certain copyrights were increased dramatically in 1982, under 17 U.S.C. § 506 and 18 U.S.C. § 2319, and were extended in 1992 to cover all types of copyrighted works. Copyright infringement now may constitute a felony under federal law if at least ten infringing copies of any type of copyrighted work with a value of $2,500 or more are made or distributed in a 180-day period. See 18 U.S.C. § 2319. Further, on September 13, 1994, Congress made a violation of 18 U.S.C. § 2319 a "specified unlawful activity" for the purposes of the money laundering statute, 18 U.S.C. § 1956, and on July 2, 1996, Congress amended 18 U.S.C. § 1961 to include copyright violations as predicate offenses under RICO. Table of Contents





2.     Requirements for Copyright Protection




"As the text of the Constitution makes plain, it is Congress that has been assigned the task of defining the scope of the limited monopoly that should be granted to authors . . . in order to give the public appropriate access to their work product." Sony Corp. v. Universal City Studios, Inc., 464 U.S. 417, 429 (1984). Thus "the protection given to copyrights is wholly statutory," id. at 431 (citation omitted), while the remedies for copyright infringement remain confined to "only those prescribed by Congress." Thompson v. Hubbard, 131 U.S. 123, 151 (1889).

As of today, Congress has exercised this authority to provide copyright protection to all "original works of authorship fixed in any tangible medium of expression, now known or later developed, from which they can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device." 17 U.S.C. § 102(a). There are two primary components to this statutory definition. First, a work must be "original." In addition, that work must be "fixed in any tangible medium of expression." The requirements of originality and fixation set the outer limits of federal copyright protection. Finally, while copyright protection exists from the time of the creation of a work, see 17 U.S.C. §§ 101, 102(a), infringement actions may only be brought with respect to those works which have been registered with the Register of Copyrights. Therefore, this section also briefly explores copyright registration, and the (now optional) inclusion of the copyright notice on the work itself.

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a.     Originality




Originality is the "sine qua non" of copyright protection. Feist Publications, Inc. v. Rural Telephone Service Co., 499 U.S. 340, 348 (1991). However, the standard for originality is minimal. The originality necessary to qualify for copyright protection calls for independent creation, not novelty. As one court has stated, "[o]riginal in reference to a copyrighted work means that the particular work owes its origin to the author. No large measure of novelty is necessary." Alfred Bell & Co. v. Catalda Fine Arts, Inc., 191 F.2d 99, 103 (2d Cir. 1951). A work is not "original" if it is simply a copy of some other work existing in the public domain; however, for a work to be "original," an author needs only to contribute something more than a "merely trivial" variation -- something recognizably his or her own. See, e.g., Sid & Marty Krofft Television v. McDonald's Corp., 562 F.2d 1157, 1163 n.5 (9th Cir. 1977); L. Batlin & Son, Inc. v. Snyder, 536 F.2d 486, 490 (2d Cir.), cert. denied, 429 U.S. 857 (1976). Even the particular arrangement of otherwise non-copyrightable information may be copyrighted. See e.g., West Publishing Co. v. Mead Data Central, Inc., 799 F.2d 1219 (8th Cir. 1986) (upholding the district court's issuance of a preliminary injunction prohibiting Mead Data Central, the owner of LEXIS, from including Westlaw's "star pagination" keyed to West's case reports in the LEXIS system of computer-assisted legal research), cert. denied, 479 U.S. 1070 (1987); Kregos v. Associated Press, 937 F.2d 700, 706-07 (2d Cir.)(the selection of nine statistical categories for use on a baseball pitching form is copyrightable), cert. denied 510 U.S. 1112 (1994).

Note, however, that to qualify for protection the arrangement must be something out of the ordinary. The alphabetical listing of names in the white pages of a phone book, for instance, does not meet the requirement of originality. Feist Publications Inc. v. Rural Telephone Service Co., 499 U.S. 340 (1991). This originality requirement does not involve any assessment of the artistic quality of a work. An author's contribution may be copyrightable if it is in some way original, without regard to how poorly the artist's work may be viewed. See Gelles-Widmer Co. v. Milton Bradley Co., 313 F.2d 143, 146-47 (7th Cir.), cert. denied, 373 U.S. 913 (1963).

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b.     Fixed medium of expression




The fixation requirement of a copyright is defined by 17 U.S.C. § 101:

A work is "fixed" in a tangible medium of expression when its embodiment in a copy or phonorecord, by or under the authority of the author, is sufficiently permanent or stable to permit it to be perceived, reproduced, or otherwise communicated for a period of more than transitory duration. A work consisting of sounds, images, or both, that are being transmitted, is "fixed" for the purposes of this title if a fixation of the work is being made simultaneously with its transmission.

Within the broad parameters set by the originality and fixation requirements, all works of authorship are entitled to copyright protection. These works include, but are not limited to:

(1) literary works; (12) (2) musical works; (3) dramatic works; (4) pantomimes; (5) pictoral, graphic, and sculptural works; (13) (6) motion pictures; (14) (7) sound recordings; (15) and (8) architectural works. (16) 17 U.S.C. § 102(a).

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c.     Registration and notice




While an author's copyright is technically created at the moment a particular work is fixed, registration of a copyright is a prerequisite to any infringement action, civil or criminal. See 17 U.S.C. § 411(a); see also United States v. Backer, 134 F.2d 533, 535 (2d Cir. 1943). A work need not be registered prior to an act of infringement, but rather before a civil or criminal case is filed. However, to be entitled to recover statutory damages and attorney's fees in a civil case, the work must have been registered prior to commencement of the infringement for which such remedies are sought. See 17 U.S.C. § 412.

Registration requires only the completion of an application, a $20 filing fee, see 17 U.S.C. § 708, and deposit of the work (or significant portions of the work) with the Library of Congress. See 17 U.S.C. § 408. While the process of registration normally takes several months, industry associations and representatives are often capable of assisting individual copyright holders in expediting the process in anticipation of litigation. A certificate of registration, if obtained within five years of the date of first publication, constitutes prima facie evidence of the validity of a copyright. 17 U.S.C. § 410(c).

Publishing a notice of copyright on the work itself, while formerly a prerequisite for registration, is now optional for works published in the United States after March 1, 1989. Though optional, the copyright notice can be used as evidence of defendants' willfulness in criminal cases when the notice was displayed prominently on a work that has been infringed.

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3.     Nature of the Rights Protected by Copyrights




In addition to describing the works that are entitled to copyright protection, Congress has defined the exclusive rights that a copyright confers on the owner. Federal law grants the owner of a copyright the exclusive right to reproduce, distribute, and publicly display or perform the copyrighted work, as well as to prepare derivative works based upon the original copyrighted work. 17 U.S.C. § 106(1)-(5). "An unlicensed use of the copyright is not an infringement unless it conflicts with one of the[se] specific exclusive rights conferred by the copyright statute." Sony Corp. v. Universal City Studios, Inc., 464 U.S. 417, 447 (1984) (citing Twentieth Century Music Corp. v. Aiken, 422 U.S. 151, 154-55 (1975)). (17) Therefore, these five exclusive rights establish the universe of acts which may constitute copyright infringement.

The monopoly established by a copyright is limited in scope. A copyright is simply an exclusive right to a particular work, i.e., to the expression of some idea in a specific format. It does not confer any monopoly in or rights to the underlying ideas, concepts or principles embodied in that work. See 17 U.S.C. § 102(b) ("In no case does copyright protection . . . extend to any idea, procedure, process, system, method of operation, concept, principle, or discovery . . ."). (18) Therefore, the rights of a copyright owner are infringed only by the copying or direct appropriation of a particular work, and not by the use of similar ideas or concepts in a different work. (19) Similarity in expression is not infringing to the extent that the underlying idea dictates the manner in which it is expressed. In such cases ideas and expression are said to be "merged" and copyright protection is unavailable in order to prevent the de facto monopoly over the idea. Kepner-Tregoe Inc. v. Leadership Software Inc., 12 F.3d 527, 533 (5th Cir.) cert.denied U.S. , 115 S. Ct. 82 (1994); see also Merritt Forbes & Co. v. Newman Inv. Secs., Inc., 604 F. Supp. 943, 951 (S.D.N.Y. 1985) ("where an underlying idea may only be conveyed in a more or less stereotyped manner, duplication of that form of expression does not constitute infringement, even if there is word for word copying.") (citation omitted).

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4.     Limitations on Exclusive Rights




The exclusive rights conferred by 17 U.S.C. § 106 are subject to a series of statutory limitations. The first set of limitations is described in 17 U.S.C. § 107 through § 120. Essentially these sections provide that certain specific uses of a copyrighted work do not violate the copyright. For the most part, these narrow statutory exemptions do not present problems of proof in criminal cases. Indeed, only one of these exemptions has constituted a significant issue in criminal prosecutions. That exemption is the "first-sale doctrine." This doctrine, which is now codified at 17 U.S.C. § 109, is discussed in detail at "The first sale doctrine in criminal cases," infra p. 27.

The monopoly created by a copyright is limited in another respect. The Constitution authorizes Congress to enact legislation "securing for limited times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries." U.S. CONST. art.1, § 8, cl.8 (emphasis added). Thus, Congress is explicitly prohibited from creating monopolies in perpetuity over intellectual property and legislation providing for such monopolies must be limited in duration.

Historically, the American copyright system set these limits by providing copyright protection for a fixed period beginning from the date of either publication or registration of the work. In 1976, however, Congress departed from this statutory scheme and adopted a system in which copyright protection began with the creation of the work and "endure[d] for a term consisting of the life of the author and fifty years after the author's death." 17 U.S.C. § 302(a). This rule now generally defines the duration of copyrights obtained on works created after January 1, 1978. In addition, Congress has provided special rules relating to works created prior to January 1, 1978, but not published or copyrighted until after that date, and to works copyrighted prior to January 1, 1978. See 17 U.S.C. §§ 303-04. Copyrights owned by corporations are accorded special treatment under the "works made for hire" provision of the Copyright Act. 17 U.S.C. § 101. (20) The employer or the corporation is considered the author of a work made for hire by an employee of the corporation. 17 U.S.C. § 201(b). See also Trenton v. Infinity Broadcasting Corp., 865 F. Supp. 1416, 1426 (C.D. Cal. 1994). Because the life of a corporate author cannot be fixed, the duration of a corporate copyright created on or after January 1, 1978, instead of a life plus fifty term, endures for a term of seventy-five years from the year of first publication of such work, or a term of one hundred years from the year of its creation, whichever expires first. See 17 U.S.C. § 302.

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5.     Computer software(21)




It is now clear, particularly since passage of the Computer Software Copyright Act of 1980, (22) that computer software is entitled to copyright protection. (23) While computer programs are generally treated as literary works for copyright purposes, Whelan Associates, Inc. v. Jaslow Dental Library, Inc., 797 F.2d 1222, 1234 (3d Cir. 1986), cert. denied, 479 U.S. 1031 (1987), in some cases they may qualify as audiovisual works. They almost certainly qualify as such in the form of video games. See Red Baron-Franklin Park v. Taito Corporation, 883 F.2d 275, 278 (4th Cir. 1989), cert. denied, 493 U.S. 1058 (1990). Computer software is copyrightable in both its source code (24) and object code (25) and without regard to whether it is used to facilitate human interaction or merely used to give operating instructions to computers. See Apple Computer, Inc. v. Franklin Computer Corp., 714 F.2d 1240, 1246-49 (3rd Cir. 1983), cert. denied, 464 U.S. 1033 (1984). It also can be copyrighted without regard to the medium in which it is fixed, whether on magnetic or optical media, or printed on paper, or embedded in a computer chip. Id. at 1249. Thus, criminal charges may arise not only from infringing copies on traditional magnetic storage media like disks and tapes, but also from illegal copies of computer code contained on computer "chips." See, e.g., United States v. Hayes, 800 F. Supp. 1575 (S.D. Ohio 1992) (copying code to blank chips), aff'd in part, vacated in part, 995 F.2d 1066 (6th Cir. 1993), appeal after remand, 16 F.3d 1222 (6th Cir. 1994); United States v. Hux, 940 F.2d 314, 319 (8th Cir. 1991) (court upheld defendant's conviction under § 506(a) for copying 205 bytes from a computer chip which contained 16,384 bytes). Even the temporary loading of an unlicensed copy of a copyrighted computer program in a computer's random access memory (RAM) has been held to constitute an infringing reproduction of copyrighted software. See, e.g., MAI Systems Corp. v. Peak Computer, Inc., 991 F.2d 511 (9th Cir.), cert. denied, 510 U.S. 1033 (1994); Advanced Computer Services v. MAI Systems Corp., 845 F. Supp. 356 (E.D. Va. 1994). Similarly, the law is likely to be applied to so-called "multi-media" works, which are similar to audiovisual creations.

Further, protections for digitally encoded works have become greater. The October 1992 revisions to the Copyright Act create a felony for some willful infringements of copyrighted software. See 17 U.S.C. § 506, 18 U.S.C. § 2319. For a detailed discussion of 18 U.S.C. § 2319, see "CRIMINAL COPYRIGHT INFRINGEMENT: 17 U.S.C. § 506(a) and 18 U.S.C. § 2319," infra, p.17.

Software violations are by no means limited to "over the counter" sales of computer diskettes containing infringing products. Rather, owing to the efficient manner in which computer software can be reproduced, stored and transferred, investigators can expect to encounter a full range of violations that make varied use of these characteristics from private, individual infringements to complex, commercial criminal operations. (26) For example, pirate copies need not be distributed "over the counter," but may change hands electronically through e-mail, electronic bulletin board systems or over the Internet. Infringing copies might also be distributed through "rental" schemes, in which legitimately purchased copies may be rented, for short periods of time, with the understanding that the software is to be copied and returned. (27)

In some instances, copyright violations may occur in conjunction with otherwise legitimate sales or business transactions. Some computer hardware dealers may engage in a deceptive form of copyright infringement called "hard disk loading," i.e., loading unauthorized copies of software onto computers they sell as a way to cut costs and as an incentive for purchasers to buy the computers.

Some violations may be more complex, such as those involving Original Equipment Manufacturers (OEMs). An OEM is a hardware manufacturer that buys assorted computer components and builds complete systems. Many OEMs have licenses with the major software vendors which allow them to sell their computer systems along with a specified number of licensed programs. The OEMs, however, are not permitted to sell the software without the hardware, known as a "standalone" version. Copyright problems may arise, however, if an OEM were to willfully exceed the number of copies authorized by their agreement with the copyright holder or if the OEM sells standalone versions of the software. These circumstances, with the exception of rental arrangements falling within the scope of 17 U.S.C. § 109(b)(1)(A), may constitute criminal violations of the copyright act. (28)

Many instances of software copyright infringement are difficult to detect and trace, as they may never involve the public sale or trading of infringing products. Rather, business entities or groups might make multiple pirate copies of software solely for their own internal use. Such internal use may still fall well within the reach of the applicable criminal provisions, which extend to those who, as will be discussed in more detail later, "infringe[] a copyright willfully and for purposes of commercial advantage or private financial gain." 17 U.S.C § 506(a). An entity that purchases a single-use copy of a popular software application, and then copies and uses that program on more than one workstation, not only commits copyright infringement, but also benefits economically from its savings by not having to purchase individual copies or a more expensive site license of the same computer program. If the program is used by employees on behalf of the business, the company would be hard-pressed to argue that its infringement was not "for purposes of commercial advantage or private financial gain." 17 U.S.C. § 506(a).

Similarly, reproducing and distributing copyrighted materials electronically may also give rise to criminal infringement charges. This is true whether copies of infringing software are reproduced for transmission by direct modem-to-modem file transfer, through the use of electronic mail (e-mail), through the use of a computer bulletin board system (BBS), or are transmitted over the Internet.

We caution, however, that the underlying civil laws defining "infringement" in an electronic environment have not yet been fully developed. Substantial doubt exists, for example, as to whether the mere electronic transmission of copyrighted works actually infringes a copyright owner's right of "distribution" which by the terms of 17 U.S.C. § 106(3) is limited to the "sale or other transfer of ownership, or by rental, lease, or lending." There is little doubt, however, that the electronic reproduction of copyrighted works in preparation for transmission clearly violates a copyright holder's well-settled rights. Therefore, absent the passage of a legislative amendment that would make "transmission" a protected act, we encourage investigators and prosecutors to treat cases that arise through the electronic transmission of copyrighted works as violations of the copyright holder's rights of reproduction, to present the evidence along these lines, and to charge these cases accordingly.

The majority of criminal copyright cases that implicate the use of computers and advanced technology will, for at least the next few years, probably focus on software rather than other digital works. But, as mentioned, the very same methods by which pirated software is reproduced and transmitted today are also being increasingly used to transmit most other forms of copyrighted works, including sound recordings, motion pictures, photographs, textual works, and even multi-media creations. Thus, the same techniques that are being developed for use against software pirates will become applicable to those other types of copyright cases arising in an electronic environment.
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----- footnotes ------

9.     Under usage of the time, "Science" was the subject matter of copyright, "Useful Arts" the subject matter of patents.

10.     Prosecutors are advised to check the current status of 17 U.S.C. § 506 and 18 U.S.C. § 2319, the core criminal copyright statutes. At the time this manual was being prepared, Congress was considering several bills which would again amend the criminal copyright statute and its penalty provisions.

11.     The federal preemption provision, 17 U.S.C. § 301(a), provides that:

On and after January 1, 1978, all legal or equitable rights that are equivalent to any of the exclusive rights within the general scope of copyright as specified by § 106 in works of authorship that are fixed in a tangible medium of expression and come within the subject matter of copyright as specified by §§ 102 and 103, whether created before or after that date and whether published or unpublished, are governed exclusively by this title. Thereafter, no person is entitled to any such right or equivalent right in any such work under the common law or statutes of any State.

12.     " 'Literary works' are works, other than audiovisual works, expressed in words, numbers, or other verbal or numerical symbols or indicia, regardless of the nature of the material objects, such as books, periodicals, manuscripts, phonorecords, film, tapes, disks, or cards, in which they are embodied." 17 U.S.C. § 101. Computer software is protected as a "literary work." See Apple Computer, Inc. v. Franklin Computer Corp., 714 F.2d 1240, 1246-49 (3d Cir. 1983); 17 U.S.C. § 117.

13.     " 'Pictoral, graphic, and sculptural works' include two-dimensional and three-dimensional works of fine, graphic, and applied art, photographs, prints and art reproductions, maps, globes, charts, diagrams, models, and technical drawings, including architectural plans." 17 U.S.C. § 101.

14.     " 'Motion pictures' are audiovisual works consisting of a series of related images which, when shown in succession, impart an impression of motion, together with accompanying sounds, if any." 17 U.S.C. § 101. Video games are often treated as audiovisual works. See Atari Games Corp. v. Oman, 888 F.2d 878 (D.C. Cir. 1989); United States v. O'Reilly, 794 F.2d 613, 614 (11th Cir. 1986) (collecting cases).

15.     " 'Sound recordings' are works that result from the fixation of a series of musical, spoken, or other sounds, but not including the sounds accompanying a motion picture or other audiovisual work, regardless of the nature of the material objects, such as disks, tapes, or other phonorecords, in which they are embodied." 17 U.S.C. § 101.

16.     "An 'architectural work' is the design of a building as embodied in any tangible medium of expression, including a building, architectural plans, or drawings. The work includes the overall form as well as the arrangement and composition of spaces and elements in the design, but does not include individual standard features." 17 U.S.C.

§ 101.

17.     Twentieth Century has been superseded by statute on other grounds.

18.     As a leading treatise on copyright law explains:

The policy rationale underlying the Act's exclusion of ideas from copyright protection is clear. To grant property status to a mere idea would permit withdrawing the idea from the stock of materials that would otherwise be open to other authors, thereby narrowing the field of thought open for development and exploitation. This effect, it is reasoned, would hinder rather than promote the professed purpose of the copyright laws, i.e., "the progress of science and useful arts."

3 MELVILLE NIMMER, DAVID NIMMER, Nimmer on Copyright § 13.03[B] at 13-69 to -70 (footnotes omitted).

19.     This dichotomy between idea and expression can be illustrated by an example. A playwright, like William Shakespeare, could copyright a particular work, Romeo and Juliet. That copyright would protect the playwright from direct theft of his work. However, the copyright would not give Shakespeare the exclusive right to use the concept of star-crossed lovers in plays or to exclude others from writing a play based on that idea. See PAUL GOLDSTEIN, Copyright's Highway, The Law and Lore of Copyright from Gutenberg to the Celestial Jukebox, 205 (1994).

20.     17 U.S.C. § 101 defines a "work made for hire" as "a work prepared by an employee within the scope of his or her employment."

21.     Prosecutors should be aware that investigating and prosecuting computer software cases is fundamentally different from cases based on the more traditional copyright schemes, like those involving the illegal copying and distribution of copyrighted motion pictures and sound recordings. Many of these differences arise from the fact that computer software is reproduced and distributed in a digital, as opposed to an analog, recording format. Digital information can be reproduced, stored, and transported in ways that are qualitatively different from the ways we are accustomed to reproducing, storing, and transporting analog technologies.

Analog technologies, such as those employed to create phonograph records, analog sound tapes, or videocassette tapes, operate by capturing electromagnetic patterns that represent (or are analogous to) the sounds or pictures themselves. Those patterns are then captured on some storage media capable of representing these rapidly changing patterns. For example, to produce a phonograph record, sounds are converted into the motion of an instrument that literally "carves" representations of those sounds into a master copy. Almost identical copies of the master are then reproduced, whereupon, on playback, the motion of the stylus is retranslated back into sounds for listening. One result of this method is that the recording is invariably an inferior reproduction of the original performance, and each successive copy of a copy is invariably slightly inferior to the copy from which it was made.

Recordings made through digital media, by contrast, depend on an intermediate translation process, whereby individual sights or sounds are interpreted into a string of binary characters -- "1's" and "0's" -- which are recorded not as constantly varying analog representations, but as successive binary characters. Thus, recording a digitally encoded signal is simply a matter of recording the successive strings of binary characters, the "1's" and "0's," in the same order in which they appeared in the original. As a result, recordings can be reliably and accurately accomplished by relatively inexpensive equipment. Additionally, duplication does not have to take place in anything approximating "real time," and so high quality copies can be produced in seconds.

Perhaps the most significant consequence is that, to one who receives a digitally encoded recording, there is no discernable degradation in quality from the original. That is, if the binary strings are faithfully reproduced in the copy, then the end product -- be it a computer program, sound recording, or motion picture -- will be identical in quality to the original. This fact carries consequences for those seeking to investigate and prosecute crimes involving digital technology. For one thing, it is no longer a relatively simple matter to determine, by reference to the recording itself, whether it is a copy or an original, or where it might fall along the duplication chain. It also follows that, unfortunately for the victim of pirating offenses, there is no natural end to the distribution chain: there is no point at which successive generations of digital duplicates will become qualitatively unacceptable to the consumer.

22.     Pub. L. No. 96-517, § 10, 94 Stat. 3028 (1980) (codified at 17 U.S.C. §§ 101, 117).

23.     For an overview of some of the challenges of proof encountered in copyright litigation pertaining to computer software, see Ronald L. Johnston, Toward an Effective Strategy in Software Copyright Litigation, 19 Rutgers Comp. & Tech. L.J. 91 (1993). Particularly useful to criminal prosecutors and investigators are the author's discussions of detecting and proving infringement, id. at 103, and evidence of copying, id. at 107.

24.     Source code is the original symbolic coding which programmers use to write computer programs. It is comprehensible to humans, but not to the computer that must execute it. Someone who steals source code can see how the program works and cannot only duplicate the program, but can modify it. The source code for a program can be also an extremely valuable trade secret.

25.     Object code (also called executable code) is the form to which source code must be converted for it to be executed by a computer. It is comprehensible to computers but not to most humans. This is the form in which computer programs are sold or licensed to the public.

26.     Another consequence of digital recording technology is that a binary string of 1's and 0's can be stored --and hence concealed -- in any number of electronic devices. More and more household devices are being built to provide electronic storage capabilities, such as computer, telephone, and television components. Digital storage technology, coupled with digital communications technology, make off-site storage of information not only a possibility, but a reality that must be accounted for in investigations. It may no longer be sufficient, in some investigations, to conduct a search of a suspect's home or workplace. It may also be necessary to gather information from remote computers to which a suspect is known to have access. See Federal Guidelines to Searching and Seizing Computers, Department of Justice, Computer Crime and Intellectual Property Section, July 1994.

27.     Rental schemes, while often resulting in the proliferation of infringing copies for a commercial purpose, are nonetheless outside the reach of existing criminal statutes. See Computer Software Rental Amendments Act of 1990, 17 U.S.C. § 109(b)(1)(A) (prohibiting the unauthorized rental, lease or lending of legitimately purchased copies of a phonorecord or computer program); and § 109(b)(4) (declaring that violations of § 109(b)(1) "shall not be a criminal offense under section 506 or cause such person to be subject to the criminal penalties set forth in section 2319 of title 18.").

28.     In contrast to the federal anti-counterfeiting statute, 18 U.S.C. § 2320, the federal criminal copyright scheme contains no exemption for "overrun" goods, that is, goods produced by a licensed manufacturer but produced in amounts exceeding the scope of the license. Thus, willful violations of contractual conditions may deserve consideration under the criminal copyright laws. Prosecutors, in such instances, should carefully scrutinize whether the infringing copies might have been produced as a result of an honest error, such as a disagreement arising from unclear licensing terms, in which case the infringement would not be "willful." See "The Elements of Criminal Copyright Infringement," infra,

p. 18.