04-1118
THE CHAMBERLAIN GROUP, INC.,
Plaintiff-Appellant,
v.
SKYLINK TECHNOLOGIES, INC.,
Defendant-Appellee.
Karl
R. Fink, Fitch, Even, Tabin & Flannery, of
Richard
de Bodo, Irell & Manella LLP, of
Jonathan
Band, Morrison & Foerster, LLP, of
Jennifer
M. Urban, Samuelson Law, Technology and Public Policy Clinic, University of
California at Berkeley School of Law (Boalt Hall), of Berkeley, California, for
amicus curiae Consumers Union. With her
on the brief was Jason M. Schultz, Electronic Frontier Foundation, of
Appealed from:
Judge Rebecca R. Pallmeyer
04-1118
THE CHAMBERLAIN GROUP, INC.,
Plaintiff-Appellant,
v.
SKYLINK TECHNOLOGIES, INC.,
Defendant-Appellee.
________________________
DECIDED:
________________________
Before GAJARSA, LINN, and PROST, Circuit Judges.
GAJARSA, Circuit Judge.
The Chamberlain Group, Inc. (“Chamberlain”) appeals the November
13, 2003 summary judgment of the United States District Court for the Northern
District of Illinois (“District Court”) in favor of Skylink Technologies, Inc.
(“Skylink”), finding that Skylink is not violating the anti-trafficking
provisions of the Digital Millennium Copyright Act (“DMCA”), 17 U.S.C. § 1201
et seq., and dismissing all other claims, including claims of patent
infringement. Chamberlain Group, Inc. v.
Skylink Techs., Inc., 292 F. Supp. 2d 1040 (N.D.
Chamberlain’s claims at issue stem
from its allegation that the District Court incorrectly construed the DMCA as placing a burden upon
Chamberlain to prove that the circumvention of its technological measures
enabled unauthorized access to its copyrighted software. But Skylink’s accused device enables only
uses that copyright law explicitly authorizes, and is therefore presumptively
legal. Chamberlain has neither proved
nor alleged a connection between Skylink’s accused circumvention device and the
protections that the copyright laws afford Chamberlain capable of overcoming
that presumption. Chamberlain’s failure
to meet this burden alone compels a legal ruling in Skylink’s favor. We therefore affirm the District Court’s
summary judgment in favor of Skylink.
Chamberlain sued Skylink, alleging
violations of the patent and copyright laws.
Chamberlain’s second amended complaint, dated
The District Court’s ruling, along with the appellate briefs that the parties and amici filed with this court, raise numerous provisions of the DMCA for our consideration. The key provisions at issue, however, are all in § 1201(a).
§ 1201.
Circumvention of copyright protection systems
(a)
Violations regarding circumvention of technological measures.
(1) (A) No person shall circumvent a technological measure
that effectively controls access to a work protected under this title. . . .
(2)
No person shall manufacture, import, offer to the public, provide, or otherwise
traffic in any technology, product, service, device, component, or part
thereof, that—
(A) is primarily designed or produced for the purpose of circumventing a
technological measure that effectively controls access to a work protected
under this title;
(B) has only limited commercially significant purpose or use other than to
circumvent a technological measure that effectively controls access to a work
protected under this title; or
(C) is marketed by that person or another acting in concert with that person
with that person’s knowledge for use in circumventing a technological measure
that effectively controls access to a work protected under this title.
(3)
As used in this subsection—
(A) to “circumvent a technological measure” means to descramble a scrambled
work, to decrypt an encrypted work, or otherwise to avoid, bypass, remove,
deactivate, or impair a technological measure, without the authority of the
copyright owner; and
(B) a technological measure “effectively controls access to a work” if the
measure, in the ordinary course of its operation, requires the application of
information, or a process or a treatment, with the authority of the copyright
owner, to gain access to the work.
17 U.S.C. § 1201(a).
The District Court reviewed the basic facts and the underlying technology in its dismissal of Chamberlain’s motion for summary judgment. Though the parties emphasize different aspects of the District Court’s factual discussion, neither one questions its general accuracy.
The technology at issue involves Garage Door Openers (GDOs). A GDO typically consists of a hand-held portable transmitter and a garage door opening device mounted in a homeowner’s garage. The opening device, in turn, includes both a receiver with associated signal processing software and a motor to open or close the garage door. In order to open or close the garage door, a user must activate the transmitter, which sends a radio frequency (RF) signal to the receiver located on the opening device. Once the opener receives a recognized signal, the signal processing software directs the motor to open or close the garage door.
When a homeowner purchases a GDO system, the manufacturer provides both an opener and a transmitter. Homeowners who desire replacement or spare transmitters can purchase them in the aftermarket. Aftermarket consumers have long been able to purchase “universal transmitters” that they can program to interoperate with their GDO system regardless of make or model. Skylink and Chamberlain are the only significant distributors of universal GDO transmitters.[1] Chamberlain places no explicit restrictions on the types of transmitter that the homeowner may use with its system at the time of purchase. Chamberlain’s customers therefore assume that they enjoy all of the rights associated with the use of their GDOs and any software embedded therein that the copyright laws and other laws of commerce provide.
This dispute involves Chamberlain’s Security+ line of GDOs and Skylink’s Model 39 universal transmitter. Chamberlain’s Security+ GDOs incorporate a copyrighted “rolling code” computer program that constantly changes the transmitter signal needed to open the garage door. Skylink’s Model 39 transmitter, which does not incorporate rolling code, nevertheless allows users to operate Security+ openers. Chamberlain alleges that Skylink’s transmitter renders the Security+ insecure by allowing unauthorized users to circumvent the security inherent in rolling codes. Of greater legal significance, however, Chamberlain contends that because of this property of the Model 39, Skylink is in violation of the anti-trafficking clause of the DMCA’s anticircumvention provisions, specifically § 1201(a)(2).
The code in a standard (i.e., non-rolling code) GDO transmitter is unique but fixed. Thus, according to Chamberlain, the typical GDO is vulnerable to attack by burglars who can open the garage door using a “code grabber.” According to Chamberlain, code grabbers allow burglars in close proximity to a homeowner operating her garage door to record the signal sent from the transmitter to the opener, and to return later, replay the recorded signal, and open the garage door. Chamberlain concedes, however, that code grabbers are more theoretical than practical burgling devices; none of its witnesses had either firsthand knowledge of a single code grabbing problem or familiarity with data demonstrating the existence of a problem. Nevertheless, Chamberlain claims to have developed its rolling code system specifically to prevent code grabbing.[2]
The essence of the rolling code system is that the transmitted signals are broken into fixed and variable (or “rolling”) components. The entire transmitted signal is a bit string. The fixed component serves to identify the transmitter. The rolling component cycles through a lengthy cycle of bit strings only some of which are capable of opening the door at any given time, ostensibly so that a burglar replaying a grabbed code is unlikely to send a valid signal—and therefore unlikely to open the garage door.
A user wishing to set up a new transmitter for use with her Security+ GDO must switch the opener to “program mode” and send a signal from the transmitter to the opener. The opener stores both the fixed and rolling components of the transmitted signal. When the user switches the opener back to “operate mode,” the system is set and the user may operate the opener with the newly programmed transmitter. In Chamberlain’s transmitter, a computer program increases the rolling code by a factor of three each time the user activates the transmitter. When the transmitted signal reaches the receiver, a program in the opener checks to see whether the rolling code received was identical to one of the most recently received 1,024 rolling codes (the “rear window”). If so, it will not activate the motor. If, on the other hand, the rolling code received is among the next 4,096 binary signals (the “forward window”), the receiver will activate the motor.
Not all recognized binary rolling signals are in either the forward or rear windows. If the transmitter sends a single signal outside of either window, the receiver will ignore it. If, however, the transmitter sends two signals outside either window in rapid succession, the opener will again access its programming, this time to determine whether the two signals together comprise a “resynchronization” sequence. If the signals differ by three, the receiver will reset the windows and activate the motor. According to Chamberlain, resynchronization accommodates the possibility that homeowners using the same transmitter for multiple residences may transmit so many signals while out of range of the opener that they exhaust the entire forward window.
Skylink began marketing and selling universal transmitters in 1992. Skylink designed its Model 39, launched in August 2002, to interoperate with common GDOs, including both rolling code and non-rolling code GDOs.[3] Although Chamberlain concedes that the Model 39 transmitter is capable of operating many different GDOs, it nevertheless asserts that Skylink markets the Model 39 transmitter for use in circumventing its copyrighted rolling code computer program. Chamberlain supports this allegation by pointing to the Model 39’s setting that operates only Chamberlain’s rolling code GDOs.
Skylink’s Model 39 does not use rolling code technology. Like Chamberlain’s products, however, the Model 39’s binary signal contains two components. The first corresponds to the Chamberlain’s fixed component identifying the transmitter, and the second simulates the effect of the Chamberlain’s rolling code. Like the Chamberlain fixed component, the primary role of the Model 39’s identifying component is in programming; a homeowner wishing to use a Model 39 in conjunction with a Chamberlain GDO must program the opener to recognize his newly purchased transmitter. When the homeowner actually uses the transmitter, it broadcasts three fixed codes in rapid succession. The first binary signal combines the identifying component with an arbitrary binary sequence. The second binary signal subtracts 1800 from the first signal. The third signal adds three to the second signal. The combination of these three codes transmitted with every press of the Model 39 transmitter button will either cause the Chamberlain GDO to operate in response to the first fixed code or cause the GDO to resynchronize and operate in response to the second and third fixed codes. Chamberlain characterizes this procedure as a circumvention of an important security measure; a code grabber that recorded the Model 39’s three codes could later play them back and activate a Chamberlain rolling code GDO without authorization.
These facts frame the dispute now before us on appeal. Though only Chamberlain’s DMCA claim is before us, and though the parties dispute whether or not Skylink developed the Model 39 independent of Chamberlain’s copyrighted products,[4] it is nevertheless noteworthy that Chamberlain has not alleged either that Skylink infringed its copyright or that Skylink is liable for contributory copyright infringement. What Chamberlain has alleged is that because its opener and transmitter both incorporate computer programs “protected by copyright” and because rolling codes are a “technological measure” that “controls access” to those programs, Skylink is prima facie liable for violating § 1201(a)(2). In the District Court’s words, “Chamberlain claims that the rolling code computer program has a protective measure that protects itself. Thus, only one computer program is at work here, but it has two functions: (1) to verify the rolling code; and (2) once the rolling code is verified, to activate the GDO motor, by sending instructions to a microprocessor in the GDO.” Chamberlain I, 292 F. Supp. 2d at 1028.
The District Court first considered
Chamberlain’s motion for summary judgment on its DMCA claim. Chamberlain I. Chamberlain sued Skylink under 17 U.S.C. §
1201(a)(2), a statutory provision that neither the Seventh Circuit nor any
previous District Court in the Seventh Circuit had ever considered. To date, in fact, only the Second Circuit has
construed § 1201(a)(2), and that construction focused on First Amendment issues
rather than on an application of the statute to case-specific facts.
At the end of this review, the
District Court denied Chamberlain’s motion for summary judgment. Chamberlain does not appeal this denial. The District Court, however, did refer back
to its discussions numerous times in its consideration and grant of Skylink’s motion
for summary judgment, the subject of the current appeal. In fact, the District Court’s discussion of
Skylink’s motion began by “assum[ing] the reader’s familiarity with [its]
earlier decision.” Chamberlain II,
292 F. Supp. 2d at 1042. Understanding
the District Court’s denial of Chamberlain’s summary judgment motion is
therefore critical to understanding its grant of Skylink’s summary judgment motion.
Chamberlain’s argument, submitted in both summary judgment motions, rests on its interpretation of the statute’s “plain language.” Chamberlain contends first, that Skylink “primarily designed or produced [the Model 39] for the purpose of circumventing [Chamberlain’s rolling code] technological measure that effectively controls access to [Chamberlain’s copyrighted computer programs],” contravening § 1201(a)(2)(A); second, that the Model 39 “has only limited commercially significant purpose or use other than to circumvent [Chamberlain’s rolling code] technological measure that effectively controls access to [Chamberlain’s copyrighted computer programs],” contravening § 1201(a)(2)(B); and third, that Skylink marketed the Model 39 “for use in circumventing [Chamberlain’s rolling code] technological measure that effectively controls access to [Chamberlain’s copyrighted computer programs],” contravening § 1201(a)(2)(C). Chamberlain I, 292 F. Supp. 2d at 1035.
Skylink submitted several defenses,
arguing that: (1) the Model 39 transmitter serves a variety of functions that
are unrelated to circumvention; (2) Chamberlain has failed to demonstrate that
its GDOs contain a computer program protected by copyright; (3) consumers use
the Model 39 transmitter to activate the Security+ GDOs with Chamberlain’s
consent; (4) Skylink has not violated the DMCA because it falls within a safe
harbor provision per § 1201(f);[5]
and (5) Chamberlain’s rolling code computer program does not protect a
copyrighted computer program, but instead protects an uncopyrightable
process.
Chamberlain submitted two arguments
in response to Skylink’s assertion that Chamberlain authorized its customers to
use the Model 39. First, Chamberlain
argued that Skylink bore the burden of proving that its behavior was
authorized, and that Skylink’s argument was therefore, at best, an affirmative defense
rather than a defect in its own pleadings.
Chamberlain II, 292 F. Supp. 2d at 1044. Second, Chamberlain noted that it never gave
consumers explicit authorization to program competing universal
transmitters into its rolling code openers, at least in part because it never
anticipated that any competitor would crack its code. Skylink did not dispute this point, but
asserted simply that in the absence of an explicit restriction, consumers must
be free to infer that they have purchased the full range of rights that
normally accompany consumer products—including those containing copyrighted embedded
software.
In assessing the authorization
issue, the District Court noted that according to the statute’s internal
definitions, “circumvent a technological measure” means to “descramble a
scrambled work, to decrypt an encrypted work, or otherwise to avoid, bypass,
remove, deactivate, or impair a technological measure, without the authority of the copyright owner.”
According to undisputed facts, a
homeowner who purchases a Chamberlain GDO owns it and has a right to use it to
access his or her own garage. At the
time of sale, Chamberlain does not place any explicit terms or condition on use
to limit the ways that a purchaser may use its products. A homeowner who wishes to use a Model 39 must
first program it into the GDO. Skylink
characterizes this action as the homeowner’s authorization of the Model 39 to
interoperate with the GDO. In other
words, according to Skylink, Chamberlain GDO consumers who purchase a Skylink
transmitter have Chamberlain’s implicit permission to purchase and to use any
brand of transmitter that will open their GDO.
The District Court agreed that Chamberlain’s unconditioned sale implied
authorization.
Chamberlain also argued that its
web page and warranty implied restrictions on the use of competing
transmitters. The District Court,
however, refused to read an implicit restriction from the mere absence of
competing products discussed on Chamberlain’s web page, particularly given the
longstanding industry practice of marketing universal transmitters. The District Court rejected the alleged
implications of Chamberlain’s warranties even more strongly, noting that
consumers are always free to forego the benefits of a product’s warranty and to
use consumer products in any way that they choose. The District Court similarly rejected
Chamberlain’s reiteration of the arguments that had proved unpersuasive in its
own summary judgment motion to defend itself against Skylink’s summary judgment
motion.
The District Court further noted
that under Chamberlain’s proposed construction of the DMCA, not only would
Skylink be in violation of § 1201(a)(2) (prohibiting trafficking in
circumvention devices), but Chamberlain’s own customers who used a Model 39
would be in violation of § 1201(a)(1) (prohibiting circumvention). The District Court declined to adopt a
construction with such dire implications.
See Chamberlain I, 292 F. Supp. 2d at 1039-40.
In short, the District Court concluded that because Chamberlain never restricted its customers’ use of competing transmitters with its Security+ line, those customers had implicit authorization to use Skylink’s Model 39. Because of that implicit authorization, Chamberlain could not possibly meet its burden of proving that Skylink trafficked in a device designed to circumvent a technological measure to gain unauthorized access to Chamberlain’s copyrighted computer programs. The District Court therefore granted Skylink’s motion for summary judgment on Chamberlain’s DMCA claim. Chamberlain timely appealed only the District Court’s final judgment in favor of Skylink on Chamberlain’s DMCA claim, not the District Court’s denial of its own summary judgment motion.
Though we have jurisdiction
to hear this appeal under 28 U.S.C. § 1295(a)(1), that finding rests upon a
detailed jurisdictional inquiry.
Chamberlain’s initial complaint described “an action for patent
infringement arising under the Patent Laws of the
Chamberlain argues, with some justification, that this characterization
of its complaint alone is enough to confer appellate jurisdiction on this
court. According to Chamberlain, the
Supreme Court’s emphasis of the well-pleaded complaint rule in determining our
jurisdiction requires us to inquire only whether the District Court’s
jurisdiction “arose under” the patent laws, at least in part. See Holmes Group v. Vornado Air
Circulation Sys., 535
The District Court first dismissed one of Chamberlain’s patent claims,
Count II, “without prejudice to Plaintiff’s reasserting its ‘703 patent claims
if the Federal Circuit reverses Judge Conlon’s decision in Chamberlain
Group, Inc. v. Interlogix, Inc., No. 01 C6157.” Chamberlain and Interlogix settled their case
while it was on appeal.
This court then remanded the matter for “the purpose of allowing the District
Court to consider the parties’ motion to vacate its judgment.” Chamberlain Group, Inc. v. Interlogix,
Inc., 75 Fed. Appx. 786 (Fed. Cir. 2003).[6] Though the Interlogix trial court
subsequently denied that motion, Chamberlain Group, Inc. v. Interlogix, Inc.,
No. 01-C6157, 2004 U.S. Dist. LEXIS 9851 (N.D. Ill., May 27, 2004), that denial
in no way disturbed the settlement. As a
result, there is no longer any set of circumstances under which this court
could “reverse Judge Conlon’s decision.”
Chamberlain can no longer reassert Count II in any forum. The District Court’s dismissal of Count II,
though styled as “without prejudice subject to a condition subsequent,” has
ripened into a dismissal with prejudice, and therefore serves as an adjudication
on the merits of Count II.
The District Court’s
effective adjudication of Count II confirmed Federal Circuit jurisdiction to
hear all appeals from the final judgment in this matter, 28 U.S.C. § 1295(a)(1), by assuring that the
District Court’s own jurisdiction arose in part under the patent laws. See Holmes, 535
Counts IV
through
patent claims in the
Counts I, II, and
VIII were the only patent claims in the Second Amended Complaint. This broad dismissal rendered the District
Court’s summary judgment for Skylink on the DMCA claim a final judgment from
which Chamberlain could appeal.
Though we have never before had to consider our jurisdiction over matters
in which a trial court dismissed all patent claims using precisely the language
that this District Court did in dismissing Claims I, II, and VIII, our
precedent is clear. Federal Circuit
jurisdiction depends on whether the plaintiff’s complaint as amended raises
patent law issues. Gronholz
v. Sears, Roebuck & Co., 836 F.2d 515, 519 (Fed. Cir.
1987); see also Holmes, 535
Dismissals without prejudice are de facto amendments to the
complaint. Gronholz, 836 F.2d at
519. For the purposes of determining
Federal Circuit jurisdiction, we do not differentiate between actual and constructive
amendments; both divest us of jurisdiction if they eliminate all issues of
patent law. See id. Dismissals with prejudice are
adjudications on the merits, and not constructive amendments to the
complaint. Zenith Elecs. Corp.
v. Exzec, Inc., 182 F.3d 1340, 1346 (Fed. Cir. 1999). In
all such cases, we retain jurisdiction to hear all appeals on all issues. See id.
Taken together, whenever the complaint
included a patent claim and the trial court’s rulings altered the legal status
of the parties with respect to that patent claim, we retain appellate
jurisdiction over all pendent claims in the complaint. See Atari, Inc. v. JS & A
Group, Inc., 747 F.2d 1422, 1432 (Fed. Cir. 1984) (en banc)
overruled on other grounds by, Nobelpharma AB v. Implant Innovation, Inc.
141 F.3d 1059 (1998) (en banc in relevant part); Zenith, 182 F.3d at 1346; Nilssen, 203 F.3d at 785. In other words, if all patent claims
raised in the amended complaint were dismissed without prejudice, the
dismissal would divest us of jurisdiction; dismissals with prejudice
would not. Nilssen, 203 F.3d at
785. Neither the specific rule
under which the District Court dismissed the claims nor the wording of the
dismissal alters the fundamental basis of our jurisdiction.
Our jurisdiction in the present matter therefore hinges on whether one or more of the District Court’s dismissals altered the legal positions of Chamberlain and Skylink vis-à-vis the dismissed claim. The Supreme Court has defined the difference between dismissals with and without prejudice:
The primary meaning of “dismissal without prejudice,” we think, is dismissal without barring the defendant from returning later, to the same court, with the same underlying claim. That will also ordinarily (though not always) have the consequence of not barring the claim from other courts, but its primary meaning relates to the dismissing court itself. Thus, Black’s Law Dictionary (7th ed. 1999) defines “dismissed without prejudice” as “removed from the court’s docket in such a way that the plaintiff may refile the same suit on the same claim,” id. at 482, and defines “dismissal without prejudice” as “[a] dismissal that does not bar the plaintiff from refiling the lawsuit within the applicable limitations period, ibid.”
Semtek Int’l Inc. v. Lockheed Martin Corp., 531
On appeal, the parties have raised a number of issues that we must address both as matters of statutory construction and as they relate to the factual disposition of this case. Chamberlain argues that “Skylink violates the prima facie requirement of anti-trafficking § 1201(a)(2).” According to Chamberlain, “Skylink did not seriously dispute that the operation of its transmitters bypasses Chamberlain’s rolling code security measure to gain access to Chamberlain’s copyrighted GDO receiver operating software, but instead focuses on an ‘authorization’ defense.” Given that “plain language” interpretation of the statute, Chamberlain also argues that the District Court erred in assigning the plaintiff the burden of proving that access was unauthorized rather than placing the burden on the defendant to prove that the access was authorized. Finally, with the burden thus shifted, Chamberlain argues that Skylink has not met its burden, and that the District Court’s grant of summary judgment was therefore in error.
Skylink primarily urges us to adopt
both the District Court’s construction and its application of its construction
to the facts of this case. In
particular, Skylink urges us not to place the burden of proving
authorization on defendants, arguing that it would be tantamount to reading a new
“authority” requirement into the DMCA.[8] To
resolve this dispute, we must first construe the relevant portions of the DMCA,
and then apply the statute, properly construed, to the specific facts at issue.
To resolve issues of substantive copyright
law, this court applies the law as interpreted by the regional circuits, in
this case the Seventh Circuit. See
Atari Games Corp. v. Nintendo of Am., Inc., 975 F.2d 832, 837 (Fed. Cir.
1992). Because this matter came to us following a summary judgment, we must
apply the Seventh Circuit’s standard of review for summary judgments. This standard does not differ from circuit to
circuit. Fed. R. Civ. P. 56; Anderson
v. Liberty Lobby, Inc., 477
Our task is essentially one
of statutory construction. It is also a
matter of first impression. For us to
determine whether or not Skylink was entitled to summary judgment that its
Model 39 universal transmitter does not violate the DMCA, we must first
determine precisely what § 1201(a)(2) prohibits. The
Seventh Circuit has considered the DMCA only once, in In re Aimster
Copyright Litigation, 334 F.3d 643, 655 (7th Cir. 2003). That case involved provisions of the DMCA
other than those at issue here. To the
extent that the Seventh Circuit provided any useful guidance to our
consideration of the DMCA, it can be captured in two simple sentences: “The
DMCA is an attempt to deal with special problems created by the so-called
digital revolution. . . . The Act does not abolish contributory infringement.”
The general methodology guiding a court’s construction of a statute is
well established, and is the same in the Seventh Circuit as it is in the
Federal Circuit. Compare Bethlehem
Steel Corp. v. Bush, 918 F.2d 1323, 1327 (7th Cir. 1990), with
The essence of the DMCA’s
anticircumvention provisions is that §§ 1201(a),(b) establish causes of action
for liability. They do not establish a
new property right. The DMCA’s text
indicates that circumvention is not infringement, 17 U.S.C. § 1201(c)(1) (“Nothing in this section shall affect rights,
remedies, limitations, or defenses to copyright infringement, including fair
use, under this title.”), and the statute’s structure makes the point even
clearer. This distinction between
property and liability is critical.
Whereas copyrights, like patents, are property, liability protection
from unauthorized circumvention merely creates a new cause of action under
which a defendant may be liable. The
distinction between property and liability goes straight to the issue of
authorization, the issue upon which the District Court both denied
Chamberlain’s and granted Skylink’s motion for summary judgment.
A plaintiff alleging copyright
infringement need prove only “(1) ownership of a valid copyright,
and (2) copying of constituent elements of the work that are original.” Feist Pub., Inc. v. Rural Tel. Serv. Co.,
499
The distinction between property and liability also addresses an important policy issue that Chamberlain puts into stark focus.[10] According to Chamberlain, the 1998 enactment of the DMCA “renders the pre-DMCA history in the GDO industry irrelevant. By prohibiting the trafficking and use of circumvention technology, the DMCA fundamentally altered the legal landscape. . . . Any analysis of practices within the GDO industry must now be undertaken in light of the DMCA.” Chamberlain reiterated and strengthened this assertion at oral argument, claiming that the DMCA overrode all pre-existing consumer expectations about the legitimate uses of products containing copyrighted embedded software. Chamberlain contends that Congress empowered manufacturers to prohibit consumers from using embedded software products in conjunction with competing products when it passed § 1201(a)(1). According to Chamberlain, all such uses of products containing copyrighted software to which a technological measure controlled access are now per se illegal under the DMCA unless the manufacturer provided consumers with explicit authorization. Chamberlain’s interpretation of the DMCA would therefore grant manufacturers broad exemptions from both the antitrust laws and the doctrine of copyright misuse.
Such an exemption, however, is only plausible if the anticircumvention provisions established a new property right capable of conflicting with the copyright owner’s other legal responsibilities—which as we have already explained, they do not. The anticircumvention provisions convey no additional property rights in and of themselves; they simply provide property owners with new ways to secure their property. Like all property owners taking legitimate steps to protect their property, however, copyright owners relying on the anticircumvention provisions remain bound by all other relevant bodies of law. Contrary to Chamberlain’s assertion, the DMCA emphatically did not “fundamentally alter” the legal landscape governing the reasonable expectations of consumers or competitors; did not “fundamentally alter” the ways that courts analyze industry practices; and did not render the pre-DMCA history of the GDO industry irrelevant.
What the DMCA did was introduce new grounds for liability in the context of the unauthorized access of copyrighted material. The statute’s plain language requires plaintiffs to prove that those circumventing their technological measures controlling access did so “without the authority of the copyright owner.” 17 U.S.C. § 1201(3)(A). Our inquiry ends with that clear language. We note, however, that the statute’s structure, legislative history, and context within the Copyright Act all support our construction. They also help to explain why Chamberlain’s warranty conditions and website postings cannot render users of Skylink’s Model 39 “unauthorized” users for the purposes of establishing trafficking liability under the DMCA.
The specific statutory provision here at issue is § 1201(a)(2) of the DMCA. The structure of the DMCA follows logically from the textual provisions distinguishing circumvention from infringement. The provisions relevant to circumvention are all in a new chapter of the Copyright Act, Chapter 12, titled “Copyright Protection and Management System.” Violators may be subject to the new civil penalties of § 1203 and the criminal penalties of § 1204, but they are not necessarily liable for copyright infringement.
The Second Circuit, as a precursor to its constitutional analysis, summarized the statute’s history and structure:
The DMCA was enacted in 1998 to implement the
World Intellectual Property Organization Copyright Treaty (“WIPO Treaty”),
which requires contracting parties to “provide adequate legal protection and
effective legal remedies against the circumvention of effective technological
measures that are used by authors in connection with the exercise of their
rights under this Treaty or the Berne Convention and that restrict acts, in
respect of their works, which are not authorized by the authors concerned or permitted
by law.”[11] Even before the treaty,
Congress had been devoting attention to the problems faced by copyright
enforcement in the digital age. Hearings
on the topic have spanned several years. . . . This legislative effort
resulted in the DMCA.
The Act
contains three provisions targeted at the circumvention of technological
protections. The first is subsection 1201(a)(1)(A), the anti- circumvention
provision. This provision prohibits a
person from “circumvent[ing] a technological measure that effectively controls
access to a work protected under [Title 17, governing copyright].” . . .
The second and
third provisions are subsections 1201(a)(2) and 1201(b)(1), the “anti-trafficking
provisions.” . . . Subsection 1201(a)(1) differs from both of these anti-trafficking
subsections in that it targets the use of a circumvention technology, not the
trafficking in such a technology.
The DMCA
contains exceptions, . . . [id. §§ 1201(d),(f),(g)] . . . creates civil remedies, id. § 1203, and
criminal sanctions, id. § 1204. It specifically authorizes a court to “grant
temporary and permanent injunctions on such terms as it deems reasonable to
prevent or restrain a violation.”
Corley, 273 F.3d at 440-41 (footnote appears as text in original; internal footnotes from original omitted).
Here, as in Corley, the
primary statutory clause at issue is § 1201(a)(2) of the DMCA, though other
subsections of § 1201 are also implicated.
Unlike the Second Circuit in Corley, which provided only enough
of the statutory construction to address constitutional challenges, however, we
must construe the full boundaries of anticircumvention and anti-trafficking
liability under the DMCA. We must determine the Congressional intent
embodied in the statute’s language, and then enforce the correctly construed
statute to the facts at hand. See
Because the DMCA is a complex
statute creating several new causes of action, each subject to numerous
exceptions, we must also ensure that our construction makes sense given the
statute’s entirety. We must therefore
consider briefly the relationship among the liabilities created under §§
1201(a)(1), (a)(2), and (b). Statutory
structure and legislative history both make it clear that § 1201 applies only to circumventions
reasonably related to protected rights.
Defendants who traffic in devices that circumvent access controls in
ways that facilitate infringement may be subject to liability under §
1201(a)(2). Defendants who use such devices
may be subject to liability under § 1201(a)(1) whether they infringe or
not. Because all defendants who traffic
in devices that circumvent rights controls necessarily facilitate infringement,
they may be subject to liability under § 1201(b). Defendants who use such devices may be
subject to liability for copyright infringement. And finally, defendants whose circumvention
devices do not facilitate infringement are not subject to § 1201 liability.
The key to understanding this relationship lies in § 1201(b),[12] which prohibits trafficking in devices that circumvent technological measures tailored narrowly to protect an individual right of the copyright owner while nevertheless allowing access to the protected work. Though § 1201(b) parallels the anti-trafficking ban of § 1201(a)(2), there is no narrowly tailored ban on direct circumvention to parallel § 1201(a)(1). This omission was intentional.
The prohibition in 1201(a)(1) [was] necessary because prior to [the DMCA], the conduct of circumvention was never before made unlawful. The device limitation in 1201(a)(2) enforces this new prohibition in conduct. The copyright law has long forbidden copyright infringements, so no new prohibition was necessary. The device limitation in 1201(b) enforces the longstanding prohibitions on infringements.
S. Rep. No. 105-90 at 12 (1998).
Prior to the DMCA, a copyright owner would have had no cause of action
against anyone who circumvented any sort of technological control, but did not
infringe. The DMCA rebalanced these
interests to favor the copyright owner; the DMCA created circumvention
liability for “digital trespass” under § 1201(a)(1). It also created trafficking liability under §
1201(a)(2) for facilitating such circumvention and under § 1201(b) for facilitating
infringement (both subject to the numerous limitations and exceptions outlined
throughout the DMCA).[13]
The importance of “rebalancing” interests in light of recent
technological advances is manifest in the DMCA’s legislative history. Though the Supreme Court has
recognized that interim industrial developments may erode the “persuasive
effect of legislative history,” New York v. FERC, 535
The most significant and consistent
theme running through the entire legislative history of the anticircumvention
and anti-trafficking provisions of the DMCA, §§ 1201(a)(1),(2), is that
Congress attempted to balance competing interests, and “endeavored to specify,
with as much clarity as possible, how the right against anti-circumvention
would be qualified to maintain balance between the interests of content
creators and information users.” H.R.
Rep. No. 105-551, at 26 (1998). The
Report of the House Commerce Committee concluded that § 1201 “fully respects
and extends into the digital environment the bedrock principle of ‘balance’ in
American intellectual property law for the benefit of both copyright owners and
users.”
The crux of the present dispute over statutory construction therefore stems from a dispute over the precise balance between copyright owners and users that Congress captured in the DMCA’s language.
Defendants argue . . . that the DMCA should not be construed to reach their conduct [or product] . . . because the DMCA, so applied, could prevent those who wish to gain access to technologically protected copyrighted works in order to make . . . non-infringing use of them from doing so. . . . Technological access control measures have the capacity to prevent fair uses of copyrighted works as well as foul. Hence, there is a potential tension between the use of such access control measures and fair use, [as well as the much broader range of explicitly noninfringing use]. . . . As the DMCA made its way through the legislative process, Congress was preoccupied with precisely this issue. Proponents of strong restrictions on circumvention of access control measures argued that they were essential if copyright holders were to make their works available in digital form because digital works otherwise could be pirated too easily. Opponents contended that strong anticircumvention measures would extend the copyright monopoly inappropriately and prevent many fair uses of copyrighted material. Congress struck a balance. . . .
Reimerdes, 111 F. Supp. 2d at 304 (citations omitted). We must understand that balance to resolve this dispute.
Congress crafted the new anticircumvention and anti-trafficking
provisions here at issue to help bring copyright law into the information
age. Advances in digital technology over
the past few decades have stripped copyright owners of much of the
technological and economic protection to which they had grown accustomed. Whereas large-scale copying and distribution of
copyrighted material used to be difficult and expensive, it is now easy and inexpensive. The Reimerdes court correctly noted
both the economic impact of these advances and their consequent potential
impact on innovation. Congress therefore
crafted legislation restricting some, but not all, technological measures
designed either to access a work protected by copyright, § 1201(a), or to infringe
a right of a copyright owner, § 1201(b).
Though as noted, circumvention is not a new form of infringement
but rather a new violation prohibiting actions or products that facilitate
infringement, it is significant that virtually every clause of § 1201 that
mentions “access” links “access” to “protection.” The import of that linkage may be less than
obvious. Perhaps the best way to
appreciate the necessity of this linkage—and the disposition of this case—is to
consider three interrelated questions inherent in the DMCA’s structure: What
does § 1201(a)(2) prohibit above and beyond the prohibitions of § 1201(b)? What is the relationship between the sorts of
“access” prohibited under § 1201(a) and the rights “protected” under the
Copyright Act? and What is the relationship between anticircumvention liability
under § 1201(a)(1) and anti-trafficking
liability under § 1201(a)(2)? The
relationships among the new liabilities that these three provisions, §§
1201(a)(1),(a)(2),(b), create circumscribe the DMCA’s scope—and therefore allow
us to determine whether or not Chamberlain’s claim falls within its purview. And the key to disentangling these
relationships lies in understanding the linkage between access and protection.
Chamberlain urges us to read the DMCA as if Congress simply created a
new protection for copyrighted works without any reference at all either to the
protections that copyright owners already possess or to the rights that the
Copyright Act grants to the public.
Chamberlain has not alleged that Skylink’s Model 39 infringes its
copyrights, nor has it alleged that the Model 39 contributes to third-party
infringement of its copyrights.
Chamberlain’s allegation is considerably more straightforward: The only way for the Model 39 to interoperate
with a Security+ GDO is by “accessing” copyrighted software. Skylink has therefore committed a per se
violation of the DMCA. Chamberlain urges
us to conclude that no necessary connection exists between access and copyrights. Congress could not have intended such a broad
reading of the DMCA. Accord Corley,
273 F.3d at 435 (explaining that Congress passed the DMCA’s anti-trafficking
provisions to help copyright owners protect their works from piracy
behind a digital wall).
Chamberlain derives its strongest
claimed support for its proposed construction from the trial court’s opinion in
Reimerdes, a case involving the same statutory provision. See Reimerdes, 111 F.
Supp. 2d at 304. Though Chamberlain is
correct in considering some of the Reimerdes language supportive, it is
the differences between the cases, rather than their similarities, that is most
instructive in demonstrating precisely what the DMCA permits and what it
prohibits.
The facts
here differ greatly from those in Reimerdes. There, a group of movie studios sought an
injunction under the DMCA to prohibit illegal copying of digital versatile discs
(DVDs). Reimerdes, 111 F. Supp.
2d at 308. The plaintiffs presented
evidence that each motion picture DVD includes a content scrambling system
(CSS) that permits the film to be played, but not copied, using DVD players
that incorporate the plaintiffs’ licensed decryption technology.
Chamberlain’s proposed construction of the DMCA ignores the significant differences between defendants whose accused products enable copying and those, like Skylink, whose accused products enable only legitimate uses of copyrighted software. Chamberlain’s repeated reliance on language targeted at defendants trumpeting their “electronic civil disobedience,” id. at 303, 312, apparently led it to misconstrue significant portions of the DMCA. Many of Chamberlain’s assertions in its brief to this court conflate the property right of copyright with the liability that the anticircumvention provisions impose.
Chamberlain relies upon the DMCA’s
prohibition of “fair uses . . . as well as foul,” Reimerdes, 111 F. Supp. 2d at 304, to argue
that the enactment of the DMCA
eliminated all existing consumer expectations about the public’s rights to use purchased
products because those products might include technological measures controlling
access to a copyrighted work. But Chamberlain appears to have overlooked the
obvious. The possibility that § 1201
might prohibit some otherwise noninfringing public uses of copyrighted
material, see, e.g. RealNetworks,
Inc. v. Streambox, Inc., No. 2:99CV02070, 2000 U.S. Dist. LEXIS
1889, at *23, (W.D. Wash., Jan. 18, 2000);
Reimerdes, 111 F. Supp. 2d at 323, arises simply because the
Congressional decision to create liability and consequent damages for making,
using, or selling a “key” that essentially enables a trespass upon
intellectual property need not be identical in scope to the liabilities and
compensable damages for infringing that property; it is, instead, a
rebalancing of interests that “attempt[s]
to deal with special problems created by the so-called digital
revolution.” Aimster, 334 F.3d at
655.
Though Reimerdes is not the only case that Chamberlain cites for
support, none of its other citations are any more helpful to its cause. In three other cases, Lexmark International,
Inc. v. Static Control Components, Inc., 253 F. Supp. 2d 943, 969 (E.D. Ky.
2003), Sony Computer Entertainment America, Inc. v. Gamemasters, 87 F.
Supp. 2d 976 (N.D. Cal. 1999), and RealNetworks, 2000 U.S. Dist. LEXIS 1889, the trial courts did grant preliminary injunctions under the DMCA using
language supportive of Chamberlain’s proposed construction. None of these cases, however, is on
point. In Lexmark, 253 F. Supp.
2d at 971, the trial court ruled that the defendant’s conduct constituted
copyright infringement. In Sony,
87 F. Supp. 2d 987, the plaintiff’s allegations included both trademark and
copyright infringement, and the defendant conceded that its product made “temporary
modifications” to the plaintiff’s copyrighted computer program. In RealNetworks, the defendant’s
product allegedly disabled RealNetworks’ “copy switch,” RealNetworks’
technological measure designed to let the owner of copyrighted material being
streamed over RealNetworks’ media player either enable or disable copying upon
streaming. RealNetworks, 2000
Furthermore, though the severance of access from protection appears
plausible taken out of context, it would also introduce a number of
irreconcilable problems in statutory construction. The seeming plausibility arises because the
statute’s structure could be seen to suggest that § 1201(b) strengthens a
copyright owner’s abilities to protect its recognized rights, while § 1201(a)
strengthens a copyright owner’s abilities to protect access to its work
without regard to the legitimacy (or illegitimacy) of the actions that the
accused access enables. Such an
interpretation is consistent with the Second Circuit’s description: “[T]he focus
of subsection 1201(a)(2) is circumvention of technologies designed to prevent
access to a work, and the focus of subsection 1201(b)(1) is circumvention
of technologies designed to permit access to a work but prevent
copying of the work or some other act that infringes a copyright.” Corley, 273 F.3d at
440-41 (emphasis in original).
It is unlikely, however, that the Second Circuit meant to imply anything
as drastic as wresting the concept of “access” from its context within the
Copyright Act, as Chamberlain would now have us do. Were § 1201(a) to allow copyright owners to
use technological measures to block all access to their copyrighted
works, it would effectively create two distinct copyright regimes. In the first regime, the owners of a typical
work protected by copyright would possess only the rights enumerated in 17
U.S.C. § 106, subject to the additions, exceptions, and limitations outlined
throughout the rest of the Copyright Act—notably but not solely the fair use
provisions of § 107.[14] Owners who feel that technology has put those
rights at risk, and who incorporate technological measures to protect those
rights from technological encroachment, gain the additional ability to hold traffickers
in circumvention devices liable under § 1201(b) for putting their rights back
at risk by enabling circumventors who use these devices to infringe.
Under the second regime that Chamberlain’s proposed construction implies,
the owners of a work protected by both copyright and a
technological measure that effectively controls access to that work per §
1201(a) would possess unlimited rights to hold circumventors liable
under § 1201(a) merely for accessing that work, even if that access
enabled only rights that the Copyright Act grants to the public. This second implied regime would be
problematic for a number of reasons.
First, as the Supreme Court recently explained, “Congress’ exercise of
its Copyright Clause authority must be rational.” Eldred v. Ashcroft, 537
That apparent irrationality, however, is not the most significant
problem that this second regime implies.
Such a regime would be hard to reconcile with the DMCA’s statutory
prescription that “[n]othing in this section shall affect rights, remedies,
limitations, or defenses to copyright infringement, including fair use, under
this title.” 17 U.S.C. §
1201(c)(1). A provision that prohibited
access without regard to the rest of the Copyright Act would clearly affect
rights and limitations, if not remedies and defenses. Justice Souter has remarked that “[n]o canon
of statutory construction familiar to me specifically addresses the situation
in which two simultaneously enacted provisions of the same statute flatly
contradict one another. We are, of
course, bound to avoid such a dilemma if we can, by glimpsing some
uncontradicted meaning for each provision.” Reno v. American-Arab
Anti-Discrimination Comm., 525
Chamberlain’s proposed severance of “access” from “protection” in § 1201(a) creates numerous other problems. Beyond suggesting that Congress enacted by implication a new, highly protective alternative regime for copyrighted works; contradicting other provisions of the same statute including § 1201(c)(1); and ignoring the explicit immunization of interoperability from anticircumvention liability under § 1201(f);[15] the broad policy implications of considering “access” in a vacuum devoid of “protection” are both absurd and disastrous. Under Chamberlain’s proposed construction, explicated at oral argument, disabling a burglar alarm to gain “access” to a home containing copyrighted books, music, art, and periodicals would violate the DMCA; anyone who did so would unquestionably have “circumvent[ed] a technological measure that effectively controls access to a work protected under [the Copyright Act].” § 1201(a)(1). The appropriate deterrents to this type of behavior lie in tort law and criminal law, not in copyright law. Yet, were we to read the statute’s “plain language” as Chamberlain urges, disabling a burglar alarm would be a per se violation of the DMCA.
In a similar vein, Chamberlain’s
proposed construction would allow any manufacturer of any product to add a
single copyrighted sentence or software fragment to its product, wrap the
copyrighted material in a trivial “encryption” scheme, and thereby gain the
right to restrict consumers’ rights to use its products in conjunction with
competing products.[16] In other words, Chamberlain’s construction of
the DMCA would allow virtually any company to attempt to leverage its sales
into aftermarket monopolies—a practice that both the antitrust laws, see Eastman Kodak Co. v. Image Tech. Servs., 504 U.S. 451, 455 (1992), and the doctrine of copyright misuse, Assessment Techs. of WI, LLC v. WIREdata, Inc., 350 F.3d 640, 647 (7th Cir. 2003),
normally prohibit.
Even were we to assume
arguendo that the DMCA’s anticircumvention provisions created a new property
right, Chamberlain’s attempt to infer such an exemption from copyright misuse
and antitrust liability would still be wrong. We have noted numerous times that as a
matter of Federal Circuit law, “[i]ntellectual property rights do not confer a
privilege to violate the antitrust laws.
But it is also correct that the antitrust laws do not negate [a]
patentee’s right to exclude others from patent property.” CSU, L.L.C. v. Xerox Corp., 203 F.3d
1322, 1325 (Fed. Cir. 2000) (citations omitted). In what we previously termed “the most
extensive analysis of the effect of a unilateral refusal to license copyrighted
expression,” id., among our sister Circuits, the First Circuit explained
that: “[T]he Copyright Act does not explicitly purport to limit the scope of
the
Because nothing in Seventh Circuit law contradicts Data General,
we similarly conclude that it is the standard that the Seventh Circuit would
most likely follow. The DMCA, as part of
the Copyright Act, does not limit the scope of the antitrust laws, either
explicitly or implicitly.
The Supreme Court
has considered the issue of implied repeal of the antitrust laws in the context of a variety of regulatory schemes and procedures. Certain axioms of construction are now clearly established. Repeal of the antitrust laws by implication is not favored and not casually to be allowed. Only where there is a plain repugnancy between the antitrust and regulatory provisions will repeal be implied.
Gordon v. N.Y. Stock Exch., Inc., 422
Finally, the requisite “authorization,” on which the District Court granted Skylink summary judgment, points to yet another inconsistency in Chamberlain’s proposed construction. The notion of authorization is central to understanding § 1201(a). See, e.g., S. Rep. 105-90 at 28 (1998) (“Subsection (a) applies when a person has not obtained authorized access to a copy or a phonorecord that is protected under the Copyright Act and for which the copyright owner has put in place a technological measure that effectively controls access to his or her work.”). Underlying Chamberlain’s argument on appeal that it has not granted such authorization lies the necessary assumption that Chamberlain is entitled to prohibit legitimate purchasers of its embedded software from “accessing” the software by using it. Such an entitlement, however, would go far beyond the idea that the DMCA allows copyright owner to prohibit “fair uses . . . as well as foul.” Reimerdes, 111 F. Supp. 2d at 304. Chamberlain’s proposed construction would allow copyright owners to prohibit exclusively fair uses even in the absence of any feared foul use. It would therefore allow any copyright owner, through a combination of contractual terms and technological measures, to repeal the fair use doctrine with respect to an individual copyrighted work—or even selected copies of that copyrighted work. Again, this implication contradicts § 1201(c)(1) directly. Copyright law itself authorizes the public to make certain uses of copyrighted materials. Consumers who purchase a product containing a copy of embedded software have the inherent legal right to use that copy of the software. What the law authorizes, Chamberlain cannot revoke.[17]
Chamberlain’s proposed severance of
“access” from “protection” is entirely inconsistent with the context defined by
the total statutory structure of the Copyright Act, other simultaneously
enacted provisions of the DMCA, and clear Congressional intent. See Tidewater Oil, 409
We therefore reject Chamberlain’s
proposed construction in its entirety.
We conclude that 17 U.S.C. § 1201 prohibits only forms of access that
bear a reasonable relationship to the protections that the Copyright Act
otherwise affords copyright owners.
While such a rule of reason may create some uncertainty and consume some
judicial resources, it is the only meaningful reading of the statute. Congress attempted to balance the
legitimate interests of copyright owners with those of consumers of copyrighted
products. See H.R. Rep.
No. 105-551, at 26 (1998). The courts
must adhere to the language that Congress enacted to determine how it attempted
to achieve that balance. See Gwaltney, 484
As we have seen, Congress chose to create new
causes of action for circumvention and for trafficking in circumvention
devices. Congress did not choose to
create new property rights. That is the
choice that we have identified. “It is
not for us to resolve the issues of public policy implicated by the choice we
have identified. Those issues are for
Congress.” Corley, 273 F.3d at
458. Were we to interpret Congress’s
words in a way that eliminated all balance and granted copyright owners carte
blanche authority to preclude all use, Congressional intent would remain
unrealized.
Congress chose words
consistent with its stated intent to balance two sets of concerns pushing in
opposite directions. See H.R.
Rep. No. 105-551, at 26 (1998).[18] The statute lays out broad categories of
liability and broad exemptions from liability.
It also instructs the courts explicitly not to construe the anticircumvention
provisions in ways that would effectively repeal longstanding principles of
copyright law. See § 1201(c).[19] The courts must decide where the balance
between the rights of copyright owners and those of the broad public tilts subject
to a fact-specific rule of reason. Here,
Chamberlain can point to no protected property right that Skylink
imperils. The DMCA cannot allow
Chamberlain to retract the most fundamental right that the Copyright Act grants
consumers: the right to use the copy of Chamberlain’s embedded software that
they purchased.
The proper construction of § 1201(a)(2) therefore makes it clear that Chamberlain cannot prevail. A plaintiff alleging a violation of § 1201(a)(2) must prove: (1) ownership of a valid copyright on a work, (2) effectively controlled by a technological measure, which has been circumvented, (3) that third parties can now access (4) without authorization, in a manner that (5) infringes or facilitates infringing a right protected by the Copyright Act, because of a product that (6) the defendant either (i) designed or produced primarily for circumvention; (ii) made available despite only limited commercial significance other than circumvention; or (iii) marketed for use in circumvention of the controlling technological measure. A plaintiff incapable of establishing any one of elements (1) through (5) will have failed to prove a prima facie case. A plaintiff capable of proving elements (1) through (5) need prove only one of (6)(i), (ii), or (iii) to shift the burden back to the defendant. At that point, the various affirmative defenses enumerated throughout § 1201 become relevant.
The District Court analyzed Chamberlain’s allegations in precisely the appropriate manner—a narrow focus on Skylink’s behavior, intent, and product within the broader context of longstanding expectations throughout the industry. The District Court assumed that Chamberlain met the first element, copyright ownership, and for the purposes of its summary judgment motions accepted Chamberlain’s evidence of the second element, technological access control. The District Court granted Skylink’s motion for summary judgment because Chamberlain failed to meet its burden on the fourth element, the lack of authorization. Chamberlain emphatically contests this conclusion on appeal, though mostly by reiterating arguments that the District Court correctly rejected.
Chamberlain, however, has failed to
show not only the requisite lack of authorization, but also the necessary fifth
element of its claim, the critical nexus between access and protection.
The DMCA does not create a new property right for copyright owners. Nor, for that matter, does it divest the public of the property rights that the Copyright Act has long granted to the public. The anticircumvention and anti-trafficking provisions of the DMCA create new grounds of liability. A copyright owner seeking to impose liability on an accused circumventor must demonstrate a reasonable relationship between the circumvention at issue and a use relating to a property right for which the Copyright Act permits the copyright owner to withhold authorization—as well as notice that authorization was withheld. A copyright owner seeking to impose liability on an accused trafficker must demonstrate that the trafficker’s device enables either copyright infringement or a prohibited circumvention. Here, the District Court correctly ruled that Chamberlain pled no connection between unauthorized use of its copyrighted software and Skylink’s accused transmitter. This connection is critical to sustaining a cause of action under the DMCA. We therefore affirm the District Court’s summary judgment in favor of Skylink.
Each party shall bear its own costs.
[1] Chamberlain’s
product, the “Clicker,” interoperates with both Chamberlain and non-Chamberlain
GDOs.
[2] According
to Skylink, Chamberlain introduced rolling codes to prevent inadvertent GDO
activation by planes passing overhead, not as a security measure.
[3] The
Model 39 interoperates with at least 15 different brands and dozens of
different GDO models, only a few of which include Chamberlain’s rolling
code. One of the Model 39’s settings
interoperates only with Chamberlain rolling code GDOs.
[4] According
to Chamberlain, the transmitter program is registered with the United States
Copyright Office as No. TX5-533-065, and the computer program in the receiver
is registered with the United States Copyright Office as No. TX5-549-995. The parties dispute whether the code used in
the program is precisely the registered code or a slight variation thereof,
possibly qualifying as a derivative work.
Because this appeal is of a summary judgment favoring Skylink, however,
we view all disputed facts in the light most favorable to Chamberlain, and therefore
assume that all programs in question are fully protected by the copyright laws.
[5] §
1201. Circumvention of copyright protection systems. . .
(f) Reverse engineering.
(1)
Notwithstanding the provisions of subsection (a)(1)(A), a person who has
lawfully obtained the right to use a copy of a computer program may circumvent
a technological measure that effectively controls access to a particular
portion of that program for the sole purpose of identifying and analyzing those
elements of the program that are necessary to achieve interoperability of an
independently created computer program with other programs. . . to the extent any such acts of identification
and analysis do not constitute infringement under this title. . . .
(4)
For purposes of this subsection, the term “interoperability” means the ability
of computer programs to exchange information, and of such programs mutually to
use the information which has been exchanged.
17 U.S.C. § 1201(f). Computer
and Communications Industry Association (CCIA), first as an amicus to the District
Court and now as an amicus to this court, submitted § 1201(f) as an alternative
basis for finding in favor of Skylink.
[6] Unpublished
opinions of the Federal Circuit may not be cited as precedent, but are
nevertheless binding on the parties.
Because of the wording of the District Court’s dismissal, this
particular unpublished opinion is critical to determining the status of Count
II in the present matter.
[7] According
to the District Court, Chamberlain also argued that it never authorized its
customers to use Model 39 transmitters in a separate action in front of the
International Trade Commission (“ITC”). In the Matter of Certain Universal
Transmitters for Garage Door Openers (“Matter of GDOs”), Inv. No. 337-TA-497, 2003 WL, slip
op. at 39, 41-42 (Nov. 4, 2003). The ITC’s
Administrative Law Judge rejected the argument.
See Chamberlain II, 292 F. Supp. 2d at 1044-45. That matter is the subject of a separate
appeal still pending.
[8] Two
amici urging us to affirm raised additional arguments that warrant
mention. Amicus Computer and
Communications Industry Association (CCIA) urges us to consider the import of §
1201(f), which explicitly allows circumvention for the purposes of achieving
interoperability. Amicus Consumers Union
(CU) urges us to consider the policy implications of Chamberlain’s proposed
construction to consumers and to aftermarket competitors. According to CU, Chamberlain’s proposed
construction of the DMCA would enable copyright owners to engage in a number of
practices that would otherwise be considered copyright misuse, an antitrust
violation, or a violation of state unfair competition laws. At oral argument, Chamberlain conceded that
its proposed construction would, indeed, alter virtually all existing consumer
expectations concerning the public’s rights to use purchased products
containing copyrighted software protected by a technological
measure—effectively confirming CU’s fears.
[9] Both
parties relied on the trial court’s decision in this case, rather than the
Second Circuit’s decision, presumably because the trial court, but not the
Court of Appeals, addressed § 1201(a)(2)(A).
[10] Amicus
CU also raised this issue in its brief to this court.
[11] WIPO
Treaty,
[12] “No
person shall manufacture, import, offer to the public, provide, or otherwise
traffic in any technology, product, service, device, component, or part
thereof, that . . . [circumvents] a technological measure that effectively
protects a right of a copyright owner under this title in a work or a
portion thereof.” 35 U.S.C. § 1201(b)(1)
(emphasis added).
[13] For obvious reasons, §
1201(a)(2) trafficking liability cannot exist in the absence of § 1201(a)(1)
violations—much as this court has often explained that “indirect [patent]
infringement, whether inducement to infringe or contributory infringement, can
only arise in the presence of direct infringement, though the direct infringer
is typically someone other than the defendant accused of indirect infringement.” Dynacore Holdings Corp. v. U.S. Philips
Corp., 363 F.3d 1263, 1272 (Fed. Cir. 2004).
[14] We do
not reach the relationship between § 107 fair use and violations of §
1201. The District Court in Reimerdes
rejected the DeCSS defendants’ argument that fair use was a necessary
defense to § 1201(a), Reimerdes, 111 F.Supp. 2d at 317; because any
access enables some fair uses, any act of circumvention would embody its own
defense. We leave open the question as
to when § 107 might serve as an affirmative defense to a prima facie violation
of § 1201. For the moment, we note only
that though the traditional fair use doctrine of § 107 remains unchanged as a
defense to copyright infringement under
§ 1201(c)(1), circumvention is not infringement.
[15] Amicus
CCIA expanded on this argument in its amicus briefs to both the District Court
and this court. Though the District
Court found this argument at least superficially persuasive, it did not reach
it. On the facts of this case, neither
can we. Because § 1201(f) is an affirmative defense, it
becomes relevant only if Chamberlain can prove a prima facie case and shift the
burden of proof to Skylink.
[16] Amicus
CU expanded on this policy implication in its brief to this court.
[17] It
is not clear whether a consumer who circumvents a technological measure
controlling access to a copyrighted work in a manner that enables uses
permitted under the Copyright Act but prohibited by contract can be subject to
liability under the DMCA. Because
Chamberlain did not attempt to limit its customers’ use of its product by
contract, however, we do not reach this issue.
[18] See
also David Nimmer, A Riff on Fair Use in the Digital Millennium
Copyright Act, 148 U. Pa. L. Rev. 673 (2000).
[19] See also Recent Cases: Copyright Law, 114 Harv.
L. Rev. 1390 (2001).