Monday, August 11, 2008


Like a fire escape, a loophole lets us escape from something . . . legal liability, a job assignment we don’t want, etc.

In a recent case from the U.S. Court of Appeals for the Federal Circuit, the U.S. government exploited a kind of loophole to avoid being held liable for copyright infringement and for violating the Digital Millennium Copyright Act (the DMCA).

The case is Blueport Co. v. U.S., 2008 WL 2854127 (Fed. Cir. 2008). You can find the opinion on the Federal Circuit’s website: here. Look for opinion number 07-5140.pdf.

Here are the facts in the case:
Blueport claims that the Government . . . infringed Blueport's copyright on . . . `the AUMD program.’ The AUMD program was written by Air Force Technical Sergeant Mark Davenport. On March 6, 2000, Davenport assigned all his rights in the AUMD program to Blueport.

When Davenport wrote the AUMD program, he was employed as a manager of the Air Force Manpower Data System (`MDS’), a database containing manpower profiles for each unit in the Air Force. In his capacity as an MDS Manager, Davenport updated the MDS with new data and provided reports . . . to Air Force personnel. . . . Davenport was also a member of the Air Force's Manpower User Group, . . . who provided guidance on the use of the MDS. Based on his experience with the MDS, Davenport concluded that the software the Air Force used . . . was inefficient and began seeking ways to redesign the software. . . . [He] learned the . . . programming . . . necessary to write the AUMD program on his own time and with his own resources. Davenport then wrote the source code for the AUMD program while at home on his personal computer. Although he wrote the program solely at his home and at his own initiative, Davenport's intent in writing the program was that other Air Force manpower personnel would use it.

Davenport shared an early version . . . with a . . . coworker, and both tested the program on the MDS at work during regular business hours. Based on the. . . testing Davenport made changes to the source code . . . on his home computer. Davenport did not . . . at any time . . . bring the . . . source code to work or copy it onto Air Force computers.

Davenport began sharing . . . the AUMD program with other colleagues. At first, [he] shared [it] . . . by giving them a computer disk containing the program or . . . installing the program on their computers. Later, [he] posted the AUMD program on an Air Force web page so that Air Force manpower personnel could download it directly. As the program became popular within the Air Force manpower community, Davenport's superiors asked him to train additional personnel in its use. . . . [H]e continued to modify the program based on feedback . . . and . . . improved its functionality and eliminated programming errors. At some point, Davenport added an automatic expiration date to each new version of the AUMD program so that users were required to download the newest version when the older one expired.

In September 1998, Davenport gave a presentation to senior Air Force manpower officers . . . and. . . `absolutely sold his audience’ on the AUMD program. . . .

[T]he Air Force . . . decided it was becoming too dependent on Davenport for access to the program. . . . Davenport's superiors asked him to turn over the source code . . . which Davenport . . . kept on his home computer. When he refused . . ., his superiors threatened him with a demotion and a pay cut, and excluded him from the Manpower User Group's advisory authority.

Davenport assigned all his rights in the AUMD program to Blueport, [which offered to license the program to the Air Force.] The Air Force refused . . . and solicited other contractors to recreate the AUMD program. The Air Force . . . contracted with Science Applications International Corporation. At the request of the Air Force, SAIC programmers modified the AUMD program's object code to extend its expiration date. This modification allowed Air Force . . . personnel to continue to use the AUMD program despite Davenport's refusal to provide the source code.
Blueport Co. v. U.S. supra.

Blueport sued the government, claiming the Air Force (i) infringed its copyright in the AUMD program and (iii) violated the DMCA by extending the expiration date in the AUMD program's object code, thus circumventing measures took Blueport to prevent its unauthorized use. The government moved to dismiss the case for lack of jurisdiction, and the Court of Federal Claims (the CFC is the court you go to if you’re suing the federal government) granted the motion. Blueport appealed to the Federal Circuit Court of Appeals, which is what this opinion is about.

Jurisdiction, as I’ve noted before, is a court’s power to hear and decide a particular case. Courts are usually assumed to have power to decide a particular case, and will do so unless there is some reason why a particular defendant is immune from suit. In the U.S., for example, law enforcement officers have a qualified immunity from suit in cases claiming, say, excessive use of force; that means they are presumed to be immune, but the plaintiff can eliminate that immunity by showing there’s a reason it shouldn’t apply in this particular case. What the U.S. government did in this case is similar: It raised the issue of sovereign immunity from suit.

Sovereign immunity is a neat little principle that derives from English common law. It says sovereigns – the U.S. government, a state government, a county, local or city government – cannot be sued unless they agree. It apparently dates back to the time when the king “could no wrong,” literally, because the king (the sovereign) basically owned everything and everyone and was, after all, the one who made the laws. If you make the laws, you pretty much don’t have to let yourself be sued for breaking them.

In this case, the U.S. government didn’t deny (or admit) any of the claims Blueport made; it simply said it could not be sued because it hadn’t waived its sovereign immunity from suit. The statute at issue was 18 U.S. Code § 1498(b) -- the statute in which the U.S. government waives some of its sovereign immunity in copyright cases. In § 1498(b), the federal government agrees to be sued for copyright infringement and/or under the DMCA EXCEPT when certain circumstances exist. Here are the two provisions that were at issue in the Blueport case:

[A] Government employee shall have a right of action against the Government under this subsection except where he was in a position to order, influence, or induce use of the copyrighted work by the Government:
[T]his subsection shall not confer a right of action on any copyright owner . . . with respect to any copyrighted work prepared by a person while in the employment or service of the United States, where the copyrighted work was prepared as a part of the official functions of the employee, or in the preparation of which Government time, material, or facilities were used.

18 U.S. Code § 1498(b).

Can you see where this is going? The government argued that it had not waived sovereign immunity in this case because (i) Davenport was in a position to “order influence, or induce use of” the AUMD program by the government; and/or (ii) he prepared it as part of his official duties and/or used government time, material and facilities to do so. Blueport Co. v. U.S. supra.

Like the lower court (the CFC), the Federal Circuit Court of Appeals held that the first option applied, which meant the government had not waived its sovereign immunity in this case (and it didn’t need to consider the second option).
[T[he CFC found that Davenport's position as a member of the Air Force manpower community gave him access and authority to distribute the AUMD program freely to his colleagues. . . . [T]he CFC found that Davenport distributed the AUMD program both by sharing individual copies with his colleagues and by posting the program on an Air Force web page so that . . . people in the Air Force manpower community could access it. The CFC also found that Davenport demonstrated the AUMD program to senior Air Force manpower personnel and was part of the Manpower User Group's advisory authority. . . . In addition, the CFC concluded . . . Davenport was in a position to influence and induce the Air Force's use of the program. We agree. Because Blueport's rights in the AUMD program are derived from Davenport, . . . Blueport's copyright infringement claim against the Government is precluded by the `order, influence, or induce’ proviso.
Blueport Co. v. U.S. supra. That was the court’s decision on the ordinary copyright infringement claims. As to the DMCA circumvention claim, it found that nothing in the DMCA waives the government’s sovereign immunity from suit. Blueport Co. v. U.S. supra. Since there is no waiver in the DMCA, the government cannot be sued under that statute, either. Blueport Co. v. U.S. supra. So Blueport can’t sue, at all . . . it’s over.

It’s good to be the king.

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