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Interoperability and the Copyright Office’s Section 1201 Report

· July 6, 2017

In its recent report on Section 1201 of Title 17, the Copyright Office amended—in a positive way—its prior interpretation of the interoperability exception in section 1201(f). The Office corrected its assertion in recent section 1201 rulemakings that section 1201(f) does not permit a consumer’s acts of circumvention in order to achieve interoperability between two computer programs. Although this is a highly technical issue, it could have reverberations throughout the economy.

Section 1201 prohibits the circumvention of technological protection measures (TPMs) that restrict access to copyrighted works. It also prohibits the development and distribution of the tools necessary to achieve this circumvention.

Section 1201 contains a variety of exceptions, including section 1201(f), which is entitled “Reverse Engineering.” Section 1201(f)(1) clearly permits the circumvention of a TPM that control access to a computer program for the 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.” That is, section 1201(f)(1) permits circumvention of a digital lock on a computer program for the purpose of reverse engineering the program to achieve interoperability with that program. Section 1201(f)(2) permits the development of the tools necessary to perform the circumvention– to unlock the TPMs.

However, during the rulemakings the Copyright Office has conducted to adopt temporary exemptions to section 1201, the question has arisen whether section 1201(f)(3) permits the circumvention of a TPM on an ongoing basis to achieve interoperability. In other words, after a firm unlocks a TPM to reverse engineer a software platform, may the firm market an application that unlocks the TPM each time it runs on that platform? And may a consumer then unlock the TPM whenever she runs the application?

In the 2003 rulemaking cycle, the Copyright Office answered those questions in the affirmative. Static Control Components had sought an exemption from section 1201 to allow its toner cartridges to circumvent TPMs on Lexmark’s Printer Engine Program. The Register of Copyrights recommended against this exemption, finding it was not necessary because “it appears that the congressional scheme sufficiently enables the noninfringing use sought without requiring the assistance of an exemption in this rulemaking.” After closely reviewing its language, the Register noted that section 1201(f) “has the capacity to satisfy interoperability with computer programs, such as the Printer Engine Program, in the marketplace….” The Register added that “if reverse engineering is conducted under the statutory exemption, a competitor may not only reverse engineer a computer program in order to create an independently interoperable computer program, but may also make the information or means of interoperability available to others….”

In later rulemakings, however, the Copyright Office interpreted section 1201(f) more narrowly. In the 2010 rulemaking, the Electronic Frontier Foundation sought an exemption to permit the “jailbreaking” of the Apple iPhone so that iPhone owners could install applications from sources other than the iTunes App Store. The Register, in her recommendation, first considered the applicability of section 1201(f). She found that “an iPhone user who ‘jailbreaks’ does not fall within the four corners of the statutory exception in section 1201(f).” This was because the iPhone consumer was not the person who reverse engineered the iPhone operating system to figure out how to achieve interoperability. Rather, the consumer was the beneficiary of the reverse engineer’s efforts. In other words, the Register interpreted section 1201(f) as permitting only the reverse-engineering party to use the means of achieving interoperability that he uncovered.

This created a legal paradox. In the 2003 rulemaking, the Register found that section 1201(f) permitted the reverse-engineering party to market the means of achieving interoperability. But in 2010, the Register held that 1201(f) did not permit a consumer to employ those means. The Register resolved that paradox by granting the iPhone consumer an exemption. The Register reasoned: “Since Congress determined that it is lawful to make such tools and provide them to others for such purposes, it is difficult to imagine why Congress would nevertheless have wished to make it unlawful for others to use the tools for the purposes for which they were lawfully provided.”

In the 2012 rulemaking, the Register once again granted the jailbreaking exemption after finding that section 1201(f) did not permit a consumer to employ the means of achieving interoperability developed by a third party. And in the 2015 rulemaking, the Register repeated this same reasoning when granting exemptions for jailbreaking, abandoned video game software, and 3D printer stock.

But in the recently released section 1201 study, the Copyright Office reversed course. The Office noted that the main question concerning section 1201 “is the extent to which section 1201 allows circumvention of access controls to achieve interoperability generally….” It observed that the Owners’ Rights Initiative (an organization which includes CCIA among its members) argued that section 1201 “makes clear that software that enables interoperability can be developed and distributed to users, who can then use that software.” The Office repeated its analysis from the 2010, 2012, and 2015 rulemakings that “section 1201(f) is unclear whether a person may circumvent for interoperability purposes if that person does not also perform identification and analysis of the programmatic elements necessary to achieve interoperability.”

However, the report states that after considering the legislative history and the purpose of the exception, “the Office now believes that section 1201’s meaning is fairly clear.” The Office now interprets section 1201(f) to permit a consumer to circumvent to achieve interoperability even when a third party develops the means of achieving interoperability.

The Copyright Office rooted its analysis in the Ninth Circuit’s Sega v. Accolade decision. The Office recognized that “multiple legislative history reports state that section 1201was intended to preserve the effects of existing case law in this area, including specifically the Ninth Circuit’s decision in Sega Enterprises Ltd. v. Accolade, Inc.” In that case, Accolade reverse engineered the object code in Sega game cartridges in order to determine the interface specifications that allowed the Sega games to run on the console. Then, Accolade replicated those interface specifications, including a small segment of initialization code, in its game cartridges. The Ninth Circuit found that the fair use doctrine permitted any copying that occurred during the course of reverse engineering.

The Copyright Office then reviewed section 1201(f) in light of Accolade. It noted that “the effect of the Accolade decision, in protecting Accolade’s inclusion of circumvention code in games offered to consumers, also implicitly authorized consumers to use this code to play Accolade games on Sega consoles.” The Office stated that “Congress codified this result in section 1201(f)(3).” The Office concluded that “while the statute is not free from ambiguity, the Office believes that section 1201(f)(3)’s authorization to make circumvention tools and information available to other for the purpose of achieving interoperability must be read to correspondingly authorize recipients—including individual consumers—to use the tools for that purpose….”

Why is this new interpretation important? The Office acknowledged that it would allow consumers to jailbreak their smartphones, without requiring an exemption. It likely would render unnecessary the exemption sought for 3D printer feedstock. Thus, parties that previously sought exemptions will not have to in the rulemaking cycle the Copyright Office just announced.

More broadly, the Office’s earlier interpretation cast a shadow over the development of competitive products. While it was lawful for a firm to manufacture a compatible aftermarket product that unlocked a TPM, the legal paradox caused by the Copyright Office’s previous interpretation of section 1201(f) meant that it might be unlawful for a consumer to use the product, absent an exemption. The uncertainly over the lawfulness of consumer circumvention, combined with the uncertainly over whether an exemption could be secured in the section 1201 rulemaking process, undoubtedly caused firms to abandon development projects. The new interpretation lifts this shadow of uncertainty.

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