Page:Sony Computer Entertainment, Inc. v. Connectix Corporation.pdf/7

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203 FEDERAL REPORTER, 3d SERIES

Station for Windows. Order on Mot. for Prelim. Inj. at 27. The district court also impounded all Connectix’s copies of the Sony BIOS and all copies of works based upon or incorporating Sony BIOS. Id. at 27–28. Connectix now appeals from this order.

II. Discussion

To prevail on its motion for injunctive relief, Sony was required to demonstrate “either a likelihood of success on the merits and the possibility of irreparable injury or that serious questions going to the merits were raised and the balance of the hardships tip sharply in its favor.” Cadence Design Sys., Inc. v. Avant! Corp., 125 F.3d 824, 826 (9th Cir.1997) (internal quotation marks and bracket omitted), cert. denied, 523 U.S. 1118, 118 S.Ct. 1795, 140 L.Ed.2d 936 (1998). We reverse the grant of a preliminary injunction only when “the district court abused its discretion or based its decision on an erroneous legal standard or on clearly erroneous findings of fact.” Roe v. Anderson, 134 F.3d 1400, 1402 n. 1 (9th Cir.1998) (internal quotation marks omitted), aff’d on other grounds, sub nom. Saenz v. Roe, 526 U.S. 489, 119 S.Ct. 1518, 143 L.Ed.2d 689 (1999). We review the scope of injunctive relief for an abuse of discretion. SEC v. Interlink Data Network of L.A., Inc., 77 F.3d 1201, 1204 (9th Cir.1996).

Connectix admits that it copied Sony’s copyrighted BIOS software in developing the Virtual Game Station but contends that doing so was protected as a fair use under 17 U.S.C. § 107. Connectix also challenges the district court’s conclusion that Sony has established a likelihood that Connectix’s Virtual Game Station tarnishes the PlayStation trademark. We consider each of these claims below.

A. Fair use

The fair use issue arises in the present context because of certain characteristics of computer software. The object code of a program may be copyrighted as expression, 17 U.S.C. § 102(a), but it also contains ideas and performs functions that are not entitled to copyright protection. See 17 U.S.C. § 102(b). Object code cannot, however, be read by humans. The unprotected ideas and functions of the code therefore are frequently undiscoverable in the absence of investigation and translation that may require copying the copyrighted material. We conclude that, under the facts of this case and our precedent, Connectix’s intermediate copying and use of Sony’s copyrighted BIOS was a fair use for the purpose of gaining access to the unprotected elements of Sony’s software.

The general framework for analysis of fair use is established by statute, 17 U.S.C. § 107.[1] We have applied this statute and the fair use doctrine to the disassembly of computer software in the case of Sega Enterprises, Ltd. v. Accolade, Inc., 977 F.2d 1510 (9th Cir.1992) (amended opinion). Central to our decision today is the rule set forth in Sega:

[W]here disassembly is the only way to gain access to the ideas and functional elements embodied in a copyrighted computer program and where there is a legitimate reason for seeking such access, disassembly is a fair use of the copyrighted work as a matter of law.

Id. at 1527–28 (emphasis added). In Sega, we recognized that intermediate copying could constitute copyright in-

  1. The factors for determining fair use include:
    (1) the purpose and character of the use, including whether such use is of a commercial natural or is for nonprofit educational purpose;
    (2) the nature of the copyrighted work;
    (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
    (4) the effect of the use upon the potential market for or value of the copyrighted work.

    17 U.S.C. § 107.