Landmark court of appeal decision on computer software
Petraware is the creator and distributor of a similar market data-capturing software, known as pTransformer.
Readsoft’s claim was not for any infringement of its source or object codes, and the dispute in this case was not concerned with the copyright of both codes. Rather, Readsoft claimed that Petraware had infringed the graphic user interface (GUI), the system flow of the modules, and the terms employed in its FORMS 5-3 software.
On September 30, 2012, the High Court judge delivered the judgment in favour of Readsoft, on the grounds that the literary components of a computer program are capable of being protected and that there were sufficient objective similarities between the FORMS 5-3 GUI, system flow and terms and the pTransformer software’s corresponding elements.
Dissatisfied with the decision, Petraware appealed to the Court of Appeal, which on September 6, 2013 reversed the High Court decision. The Court of Appeal held that to accord copyright protection to logical flowcharts will be to allow basic scientific ideas to be monopolised, and will thus impede research and scientific advancement of such ideas for the good of the general public.
It was held that provided the concrete expressions of these ideas are not copied—such as the copying of source and object codes—others should be allowed to study, advance and reformulate these basic ideas and create newer, and perhaps better, software programs. The court relied on Section 7(2A) of the Copyright Act 1987, which excludes protection to any idea, procedure, method of operation or mathematical concept.
As a result, Readsoft was not accorded monopoly over terms employed by the FORMS 5-3 software that were deemed ordinary English words, such as ‘forms definition’, ‘batch definition’, ‘job description’, ‘data field’, and ‘adjustment field’. Even if it were to be assumed that the terms could be described as ‘artistic works’, the software lacked the essential element of originality. Relying on Section 7(3) of the Copyright Act 1987, there was insufficient effort expended to make the work original in character.
The Court of Appeal went on to hold that the GUI of FORMS 5-3 was not infringed in the pTransformer software. Based on an objective assessment of the comparative screenshots of the GUIs, the court ruled that while there were some similarities, they looked different when viewed as a whole.
Last, the court ruled that Readsoft failed to prove subsistence of its copyright in the system flow, terms and GUI of the FORMS 5-3 Software, as it failed to annex a true copy of each to the statutory declaration evidencing ownership of copyright.
Since the reversed judgment, Readsoft has applied to the Federal Court for leave to appeal against the Court of Appeal decision. The application for leave was heard on February 5, 2014 and the Federal Court refused leave as there was no question of law that required clarification by it.
The Court of Appeal decision has a significant impact on the software industry in Malaysia as this is the first case that comprehensively touches on all copyright-protected elements of a computer’s software. The decision is testament that our courts recognise copyright protection for non-literal and literal parts of a computer program.
This is consistent with the position adopted in the UK, and regardless of whether non-literal parts are classified as literary or artistic works, it is still important to question whether the works were original in the first place. In determining originality, courts would consider whether sufficient effort had been expended to make the work original in character.
If owners of copyright in software intend to allege that the non-literal portion of their software has been infringed, they should be prepared to demonstrate that the non-literal work is original and that sufficient effort, skill and labour had gone into creating the non-literal aspects of the software.
