Federal Circuit Holds That Open Source Code Licensors Are Entitled to Copyright Protection Governing Use of Code

Holding:

In a cutting edge case involving open source programming code licensing, the U.S. Court of Appeals for the Federal Circuit held that distributors of free open source programs can rely on copyright law and sue for monetary damages if the terms of their use licenses are violated. In this case, plaintiff-appellant Robert Jacobsen ("Jacobsen"), who held a copyright to a computer programming code, made that code available for free public download from a website pursuant to an "open source", or public license (the “Artistic License”). In the underlying case, the U.S. District Court for the Northern District of California denied Jacobsen’s motion for a preliminary injunction against defendants-appellees Matthew Katzer and Kamind Associates, Inc.(collectively "Katzer/Kamind") whom Jacobsen accused of copying copyrighted code from his website and incorporating it into Katzer/Kamind's software packages in violation of the Artistic License. The District Court ruled that Jacobsen’s Artistic License precluded copyright infringement liability. On appeal, the Federal Circuit reversed, holding that copyright holders who engage in open source licensing have the right to control the modification and distribution of their copyrighted material whether or not the license is provided free or charge. The language of the Artistic License at issue put conditions on the use of the open source programming code, and a violation of those conditions gave rise to a proper claim here. On such basis, the Federal Circuit vacated the denial of the motion for preliminary injunction, and remanded the case back to the District Court for further review.

Detailed Summary:

The issue in this case was whether a copyright holder who made certain copyrighted programming code available for free public use could validly enforce an “open source” copyright license to control the distribution and modification of that software.  Plaintiff-appellant Jacobsen appealed from an order denying his motion for preliminary injunction. Opinion, p.1, citing Jacobsen v. Katzer, No. 06-CV-01905 JSW, 2007 WL 2358628 (N.D. Cal. Aug. 17, 2007). Jacobsen held the copyright to his computer programming code and made that code available for free public download as part of his open source software group, Java Model Railroad Interface (“JMRI”). Though provided free of charge to the public, the downloadable files contained copyright notices and referred users to a “COPYING” file, which clearly set forth the terms of the Artistic License.

Defendant-appellee Katzer/Kamind develop commercial software products for the model train industry.  Jacobsen accused Katzer/Kamind of copying certain materials from Jacobsen’s website and incorporating them into one of Katzer/Kamind’s software packages for sale without following the terms of the Artistic License. Jacobsen brought an action for copyright infringement and moved for a preliminary injunction. Id., p.2.

In the underlying case before the U.S. District Court for the Northern District of California, the District Court held that the open source Artistic License created an “intentionally broad”, nonexclusive license which was unlimited in scope and thus did not create liability for copyright infringement.  The District Court reasoned that “(d)efendants’ alleged violation of the conditions of the license may have constituted a breach of the nonexclusive license, but does not create liability for copyright infringement where it would not otherwise exist.”  Id., citing Jacobsen, 2007 WL 2358628 at *7. On this basis, the District Court denied the motion for a preliminary injunction.

In this appeal, the Federal Circuit vacated and remanded the District Court’s decision. The Federal Circuit held that copyright holders who engage in open source licensing have the right to control the modification and distribution of copyrighted material.  The Federal Circuit noted, “Copyright licenses are designed to support the right to exclude; money damages alone do not support or enforce that right.” Id., pp. 12-13.  Because a calculation of damages is inherently speculative, these types of license restrictions might well be rendered meaningless absent the ability to enforce them through injunctive relief, the Federal Circuit added. Id. p. 13.

More specifically, the Federal Circuit held that it was outside the scope of the Artistic License for Katzer/Kamind to modify and distribute the copyrighted materials without copyright notices and a tracking of modifications from the original computer files.  Of note, if a downloader does not assent to the conditions stated in the COPYING file, he or she is instructed to “make other arrangements with the Copyright Holder.” Id., pp. 13-14.  Here, Katzer/Kamind did not make any such “other arrangements.”

Therefore, because the clear language of the Artistic License created conditions which governed the rights to modify and distribute the open source programming code, the use of the programming code in Katzer/Kamind’s downloadable software package was unlawful. On the basis of the foregoing, the Federal Circuit reversed the District Court’s decision denying plaintiff-appellant’s application for a preliminary injunction, and ordered remand to the District Court in accordance with its opinion.

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