Open source software license enforcement actions on the rise

Editor’s note: This is the latest in a series of "Executive Insight” columns, a regular feature for Local Tech Wire as part of its partnership with the Triangle Technology Executives Council and MMI Public Relations..

By Nichelle N. Levy, special to Local Tech Wire.

Editor’s note: Nichelle N. Levy is an attorney with Robinson, Bradshaw & Hinson. Her practice includes corporate and commercial law, intellectual property (with a focus on trademark and copyright related matters), and sports and entertainment. Levy will discuss this topic at TTEC’s next monthly luncheon on Dec. 8 at Brier Creek Country Club.

RESEARCH TRIANGLE PARK, N.C. - What do Verizon, Cisco Systems, Bell Microproducts, Super Micro Computer, Monsoon Multimedia, Xterasys Corp, High-Gain Antennas and Extreme Networks have in common? All of these companies were sued by the Free Software Foundation (FSF) or the Software Freedom Law Center (SFLC), a law firm affiliated with FSF, for open source software license violations.

The FSF, SFLC and other licensors have recently taken a more active approach to enforcement of open source software licenses, leading to a host of enforcement actions against companies that incorporate open source software into their products.

What is Open Source Software?

Software is generally distributed in object code form. However, software developers can choose to distribute their software in source code form, which is human-readable and allows those receiving it to understand how the software operates and modify it. An open source software license is generally a conditional license grant in which the software developer distributes the software in source code form to the licensee at little or no monetary cost. The big condition is usually that if the licensee redistributes the software or a modified version of it, then the licensee must do so under the same open source terms.

Recent Open Source Software Enforcement Actions

In late 2007 and early 2008, the SFLC filed and settled a series of lawsuits on behalf of the principal developers of BusyBox software (BB Software). These cases are notable for being the first litigation involving enforcement of the General Public License (GPL). BB Software is licensed under the GPLv2, which requires that redistributors provide end users with access to the BB Software source code. Plaintiffs in these actions accused the defendants of failing to do so. Each defendant settled for an undisclosed amount of money and also agreed to comply with the GPL, undertake "substantial” efforts to notify previous recipients of defendants’ products of their violation of the GPL and appoint an "Open Source Compliance Officer” within their organizations to monitor and ensure GPL compliance. The FSF filed a similar lawsuit against Cisco Systems, Inc. in December 2008, which settled on May 20, 2009 on similar terms.

As a result of the lack of legal decisions involving enforcement of open source licenses, their potency had been in doubt. Last August, in Jacobsen v. Katzer, the Court of Appeals for the Federal Circuit confirmed the enforceability of open source licenses and also addressed the remedies available to open source licensors.

The case involves Robert Jacobsen, a leading member of the Java Model Railroad Interface Project (JMRI), an online open source community that develops model train software. Jacobsen accused Matthew Katzer, CEO and chairman of the board of directors of Kamind Associates, Inc., of copyright infringement because Katzer’s company included the JMRI software in its software but failed to comply with the attribution requirements of the Artistic License, an open source license.

On appeal from denial of Jacobsen’s request for a preliminary injunction, the Federal Circuit held that the Artistic License is a valid license that imposes enforceable copyright conditions. That is, use of the JMRI software in violation of the Artistic License can amount to a copyright infringement rather than a mere breach of contract – which can expose the violator to more drastic remedies. The Federal Circuit emphasized that even though open source licensors may not reap direct economic benefit, they still can suffer economic harm when licensees do not comply with the license terms. Economic harm can include loss of reputational benefits and the benefits of rapid product improvements gained through the open source process. The Federal Circuit then sent the case back to the district court for reconsideration in light of the guidelines it had established.

The district court agreed to hear Jacobsen’s copyright claims, but again denied his request for a preliminary injunction due to a lack of evidence that any specific harm had been suffered or was imminent as a result of the alleged copyright infringement. The court also found that Jacobsen failed to identify with particularity the extent of his copyright ownership of the disputed source code. The case is set for trial in the district court in March 2010.

These enforcement actions reinforce the importance of understanding what open source software is included in products distributed by your company, and establishing policies and procedures to ensure your company’s compliance with the distribution terms of any applicable open source licenses.

About the author: Nichelle N. Levy is an attorney with Robinson, Bradshaw & Hinson. Her practice includes corporate and commercial law, intellectual property (with a focus on trademark and copyright related matters), and sports and entertainment. She was previously Director of Business Affairs for Time Warner Global Marketing, Inc. and associated with Loeb & Loeb LLP, in its New York Entertainment Department. Prior to attending law school, Ms. Levy gained experience in advertising and brand management with Leo Burnett, Philip Morris and EMI Music.