Situation Management Systems, Inc. v. Asp. Consulting LLC
560 F.3d 53, 90 U.S.P.Q. 2d (BNA) 1095, 2009 U.S. App. LEXIS 5755 (2009)
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Rule of Law:
The originality requirement for copyright protection demands only independent creation and a minimal degree of creativity, not novelty or creative merit. While 17 U.S.C. § 102(b) excludes un-copyrightable ideas, processes, and systems, the specific expression, selection, and arrangement used to describe them remains copyrightable.
Facts:
- Situation Management Systems, Inc. (SMS) creates and sells copyrighted training materials teaching techniques for workplace communication and negotiation.
- Several key SMS employees, including Dane Harwood and Alexander Moore, who had helped author SMS materials, left the company after it was acquired by Sharon Malouf in 2001.
- In 2003, after his noncompete period ended, Harwood, along with Moore and another individual, founded ASP. Consulting LLC (ASP), a direct competitor to SMS.
- Harwood and Moore had intimate familiarity with SMS's works and access to them; Harwood kept copies of SMS's materials in his attic after leaving the company.
- ASP quickly produced its own training materials on the same topics as SMS's works, with one version being prepared in as little as six days.
- An SMS European licensee contacted SMS to report that ASP's new training program was 'the same' as SMS's program.
Procedural Posture:
- Situation Management Systems, Inc. (SMS) sued ASP. Consulting LLC (ASP) for copyright infringement in the U.S. District Court for the District of New Hampshire.
- The New Hampshire district court dismissed the suit for lack of personal jurisdiction over ASP.
- SMS then filed a new suit against ASP for copyright infringement in the U.S. District Court for the District of Massachusetts.
- After the district court denied cross-motions for summary judgment, the parties agreed to proceed on a 'case stated' basis, submitting the dispute to the judge on the existing record.
- The district court found that ASP had factually copied SMS's works but entered a judgment of noninfringement, concluding the works were not 'substantially similar' because most of SMS's content was unprotectable material.
- SMS (appellant) appealed the district court's judgment of noninfringement to the U.S. Court of Appeals for the First Circuit.
- ASP (appellee) cross-appealed the district court's denial of its motion for attorneys' fees.
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Issue:
Does the description of a process or system in training materials lack copyright protection under 17 U.S.C. § 102(b), and does the originality requirement under 17 U.S.C. § 102(a) require novelty or creative merit?
Opinions:
Majority - Lynch, Chief Judge.
No, the description of a process or system does not lack copyright protection, and the originality requirement does not demand novelty or creative merit. The district court committed two fundamental errors of law. First, it improperly conflated copyright's originality requirement with patent law's novelty standard and wrongly injected its subjective assessment of the works' creative worth. Citing Feist, the court reiterated that originality requires only independent creation and a 'minimal degree of creativity,' a standard SMS's works easily meet. Second, the district court misinterpreted 17 U.S.C. § 102(b) by excluding the descriptions of processes from protection. This section codifies the idea/expression dichotomy, meaning the underlying process is not copyrightable, but the author's original expression in describing that process—including its structure, selection, and arrangement—is protected. Because the district court erroneously excluded large portions of SMS's works from its analysis, its finding of no substantial similarity was based on an incorrect legal framework and must be vacated.
Analysis:
This decision strongly reaffirms two core tenets of copyright law: the low bar for originality and the inviolability of the idea/expression dichotomy. It serves as a crucial clarification for lower courts to avoid conflating originality with novelty and to refrain from making subjective judgments about a work's creative value. The ruling provides significant protection for the creators of instructional and 'how-to' materials, a multi-billion dollar industry, by confirming that their unique expression and arrangement of ideas and processes are copyrightable. By cautioning against 'over-dissecting' a work, the court ensures that the copyrightability of the work as a whole is not lost by focusing only on its unprotectable components.
