Sixth Circuit Clears Lexis Nexis of Copyright Infringement
FindLawBy Kevin Fayle
The Sixth Circuit Court of Appeals has affirmed a district court's dismissal of copyright infringement claims by a Michigan law firm against Lexis Nexis regarding legal forms and the software for filling them out. The decision cleared Lexis of infringement, but re-instated a breach-of-contract claim that the district court had dismissed on the pleadings.
The firm - Ross, Brovins & Oehmke, P.C. - had contracted with Lexis as LawMode to produce automated Michigan legal forms. Under the contract, LawMode would make templates that would collect information from users in order to populate the selected forms. LawMode created and modified the templates using Lexis' proprietary "HotDocs Pro" software, and Lexis published the templates and forms as a CD or as downloadable software. There were 576 forms altogether, and most of the forms used in the final product were approved by the Michigan State Court Adminstrative Office (SCAO) and in the public domain.
Lexis ended the contract with LawMode in February 2002. According to the terms of the contract, LawMode owned the templates it had created, and the company registered a copyright for them in June of 2003.
In July 2002, Lexis put out a similar product containing 406 SCAO forms and templates. Three hundred and fifty of the forms were also forms that LawMode had selected for inclusion in the previous product. LawMode argued that Lexis copied their templates, while Lexis maintained that the new templates were created independently of the LawMode product.
Lexis had access to the LawMode templates, but instructed its programmers to ignore the old templates unless they became "really confused about something." Still, LawMode posited that the two sets of templates were so similar as to constitute infringement.
The court did not agree. While recognizing that LawMode's templates were a compilation that fell under copyright protection, the court adopted the district court's analysis that Lexis' selection of forms did not rise to the level of infringement. Moreover, the programming involved in making the forms interactive was not copyrightable since it did not display enough creativity.
The Similarity of the Selections
The Sixth Circuit concluded that Lexis displayed sufficient independent judgment and creativity to demonstrate that the two compilations were not copies of each other. This determination arose out of the fact that Lexis did not copy all of the forms, or even a high percentage of a relevant subset of the forms. According to Feist Publ'ns, Inc. v. Rural Tel. Serv. Co., compilers may use the facts contained in a compilation (in this case, the forms themselves) so long as they don't feature the same selection and arrangement.
Here, Lexis only used around 61% of the forms chosen by LawMode. Lexis also arranged and classified the forms in such a way that set their compilation apart from LawMode's. Lexis' independent professional judgment concerning which forms to use also weighed in favor of a finding of non-infringement. The two works, according to the court, were so "substantially dissimilar" that no two reasonable jurists could disagree as to the absence of infringement.
The Interactivity of the Forms
A more interesting question in the case was whether the interactivity of Lexis' templates violated LawMode's copyright. Again, the answer was no, but this time the court determined that LawMode did not even have a valid copyright in the form-automation since the processes and displays used by the templates were not sufficiently original.
LawMode first claimed that Lexis' dialog boxes for the templates directly copied LawMode's, and thus violated its copyright. The court pointed out, however, that LawMode used the default settings when creating its template in HotDocs. This choice rendered the appearance of the dialog boxes unoriginal, since the "choice" of the default settings was too trivial. In addition, since the determination of how the default settings would appear was made by Lexis, LawMode's decision to copy that choice would not be copyrightable.
LawMode next claimed a violation of its copyright in the "interrelation of variables" in templates. Again, the court determined that LawMode did not have a valid copyright here because the claimed item was unoriginal. The court reasoned that the interrelation of the items in the form was a function of the requirements of the form itself. Thus, when a template deactivated certain options based on the type of underlying form, it was the requirements of the form, and not any creativity on the part of the template's creators, that determined the interrelationship of the items. Because LawMode added no creative exression to the interrelationship, it could not claim a copyright in the interactivity of the templates.
Still on the Hook?
While Lexis has avoided the infringement claims for now, the Sixth Circuit reinstated LawMode's claim for breach-of-contract. The district court dimissed the contract claim based on Federal Rule of Civil Procedure 12(c), which allows dismissal where the plaintiff can prove no set of facts in support of her claims. Here, the Sixth Circuit ruled, LawMode has stated a claim that Lexis has continued to sell its templates in violation of the agreement that expressly prohibited Lexis from doing so. While it is true that Lexis has not violated LawMode's copyright, it is possible that Lexis is still selling templates that LawMode created, which would ostensibly violate the terms of the agreement. Further hearings are required to determine whether this is the case, so for now we'll have to wait and see what the future holds for this suit.
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