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Reverse Engineering Software to Achieve Compatibility is Fair Use

January 1993

Until recently an issue of profound legal and economic significance to the computer software industry remained unanswered under U.S. copyright law. This was whether it is a copyright violation to decompile the object code of a copyrighted program, not for the purpose of copying protectible expression in the code, but to examine the program’s unprotected ideas and elements.

Now, within a month of each other, two federal appeals courts have held that under certain circumstances it is “fair use” for software companies to reverse engineer a program in order to examine and copy its ideas and any unprotected expression. Coincidentally, the two cases involved Sega and Nintendo, two competitive giants of the home computer video game industry. In both cases the issue was whether video game authors — Accolade in the case of Sega and Atari in the case of Nintendo — had the right to reverse engineer the software contained in computer game consoles to learn the security code necessary for game cartridges to operate on the consoles. Both courts held that reverse engineering may constitute fair use, and the court handling the case against Accolade found that fair use was a complete defense against Sega’s charges. However the court handling the case against Atari found that in addition to reverse engineering Nintendo’s program, Atari had obtained in unauthorized copy of the program and had copies protected expression. Therefore, the court upheld a trial court’s preliminary finding that Atari had infringed Nintendo’s copyright.

 

Sega Enterprises Ltd. v. Accolade, Inc.

Sega manufactures the Genesis video game console. The console contains a “lock-out” feature: unless the machine finds a security code segment present in a video game cartridge — consisting of about 25 bytes of data — it will not run the cartridge.

Accolade disassembled object code stored in read-only memory (“ROM”) chips in Sega’s console, and uncovered the utilization code segment. It incorporated that code into its own game programs (which otherwise were completely original), enabling them to operate on the Genesis consoles.

Sega filed suit, complaining that Accolade, by reverse engineering the Sega software contained in its console, had violated Sega’s copyright. The Ninth U.S. Circuit Court of Appeals held that disassembly of copyrighted object code is a fair use of the copyrighted work if “disassembly provides the only means of access to those elements of the code not protected by copyright and the copier has a legitimate reason for seeking such access.” The court ruled that Sega’s reason for reverse engineering, access to the Nintendo computers, was legitimate. Although Accolade might have been able to obtain the code by licensing it from Sega, that would have required Accolade to enter into an exclusive business relationship with Sega, a condition to access that the court considered to be unreasonable. Accordingly, Accolade satisfied the requirements for fair use.

 

Atari Games Corp. v. Nintendo of America, Inc.

Nintendo is a competitor of Sega, and like Sega its video game system contains a software feature that prevents a console from accepting a game cartridge that does not contain a security code. Atari took two actions in order to overcome this lock-out feature: it reverse engineered the Nintendo home video system console and, to assist it in that process, it obtained copies of parts of the Nintendo code from the Copyright Office under false pretenses.

The U.S. Circuit Court of Appeals for the Federal Circuit held that reverse engineering an authorized copy of object code was a fair use of the work. However, in order to use the fair use defense in a case involving reverse engineering the copier must begin with a legitimate copy. Because Atari had used “purloined” code obtained from the Copyright Office, fair use was unavailable to it. Nevertheless, the Court left no mistake about its position on reverse engineering in cases using authorized copies: “when the nature of a work requires intermediate copying to understand the ideas and processes in a copyrighted work, that nature supports a fair use for intermediate copying.”

Another difference in the facts of the two cases contributed to the holding against Atari. In the Sega case Accolade had copied only the 25 byte code segment necessary for its game cartridges to work on the Sega consoles. The court viewed this as an unprotected functional element of the program, which Accolade was entitled to copy.

In the Nintendo case Atari did not copy the security code itself, but rather the program which generated the security code. The court held that this program reflected “creative organization” not required by external factors, noting that there were a “multitude of different ways to generate a data stream” which would unlock Nintendo’s consoles. Because Atari had copied a computer program protected by copyright law, it had infringed Nintendo’s program.

TLB Comment : Last year we commented extensively on the trend the courts have demonstrated toward narrowing the scope of copyright protection for computer software, thereby permitting broader access to what might, only a short while ago, have been considered protectible expression. (See the discussion of Computer Associates v. Altai in our July 1992 issue). The decisions in Sega and Nintendo show that the trend toward providing greater access to the unprotected elements of computer software is continuing. We believe that the fair use doctrine will be applied to permit reverse engineering not only for the limited purpose of achieving compatibility, as the Sega court held, but also for the purpose of understanding and copying unprotected ideas, as the Nintendo court suggested.