HQ 450068: Copyright infringement of an IBM registered and recordedcopyright of an EGA Code BIOS program (Registration TX 1-869-411and Headquarters Issuance Number 86-207)

Native CBP ruling rendition. Applicability is fact-specific; modification/revocation relationships and original publisher date are retained. Publisher sentinel year0001 means unknown date, not a historical legal adoption.

                            HQ 450068

                         August 24, 1990


TRA CO:R:P IPR 450068 TPT

CATEGORY:  Copyright

District Director of Customs
Los Angeles, California 90731

RE:  Copyright infringement of an IBM registered and recorded
copyright of an EGA Code BIOS program (Registration TX 1-869-411
and Headquarters Issuance Number 86-207)

Dear Sir:

     This is in reply to your May 10, 1990 letter forwarding a
case  file in a matter involving potential copyright infringement
with regard to the importation of Prolite 286 Laptop Computers.

FACTS:

     CAF Technology, Inc., imported a shipment of 100 Prolite 286
Laptop computers.  The merchandise was entered on January 2,
1990, and is valued at $171,400.  A sample was sent to the
Customs laboratory in Los Angeles for possible infringement of a
registered and recorded copyright.  The Customs laboratory
determined that the computer graphics EGA code BIOS was 39.61
percent similar overall with IBM's EGA code BIOS.

     Pursuant to Customs regulations, 19 C.F.R. 133.43, the
shipment of computers was detained on suspicion of copyright
infringement.  The importer denied piracy.  IBM posted the
required surety bond in the amount of $205,680 and submitted a
written demand for exclusion of the suspected merchandise.  The
importer and copyright owner submitted written materials for
their respective positions to the Customs district director.  The
file was sent to Headquarters for a decision on the issue of
copyright infringement.

     Subsequent to the detention of this shipment of laptop
computers, a Customs inspector interviewed Mr. Eric Huang, vice
president and general manager of CAF.  During the interview, Mr.
Huang stated that CAF bought the BIOS program from Genoa and
thereafter CAF technicians made modifications to the program  so
it would meet CAF specifications.  Mr. Huang stated that the
modifications were approved by Genoa.

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ISSUE:

     Whether the EGA Code BIOS programs resident in the Eproms of
the imported laptop computers infringe the above-referenced IBM
copyright?

LAW AND ANALYSIS:

     Section 602(b) of the Copyright Law (17 U.S.C. 602(b))
prohibits the importation of articles infringing a copyright and
section 603(c) of the Copyright Law (17 U.S.C. 603(c)) provides
that such articles are subject to seizure and forfeiture in the
same manner as property imported in violation of Customs revenue
laws.  However, the articles may be returned to the country of
export whenever it is shown to the satisfaction of the Secretary
of the Treasury (Customs) that the importer had no reasonable
grounds for believing that his or her acts constituted a
violation of law (19 C.F.R.  133.47).  The burden of proof shall
be upon the party claiming that the article is in fact an
infringing copy (19 C.F.R. 133.43(c)(1)).

     The basic test for determining whether a copyrighted work
has been infringed is to establish that unauthorized copying has
occurred.  Whelan Associates, Inc. v. Jaslow Dental Laboratory,
Inc., 797 F.2d 1222 (3d Cir. 1986), cert. denied, 479 U.S. 1,031
(1987); Atari, Inc. v. North American Philips Consumer
Electronics Corp., 672 F.2d 607, 614 (7th Cir. 1982), cert.
denied, 459 U.S. 880 (1982).  Since direct evidence of copying is
often unavailable, copying may be proved by inference by showing
that the alleged infringer had access to the copyrighted work and
by evidence of substantial similarity between the copyrighted
work and the alleged infringing work.  Whelan at 1232.  

     The specific inquiry is whether the alleged infringing work
is so similar to the protected work that an ordinary reasonable
person would conclude that the alleged infringer fully
appropriated the protected work by taking material of substance
and value.  Atari at 614.  It is not a defense to infringement to
claim that slight differences or variations exist between the
protected work and the alleged copy.  E.F. Johnson Co. v. Uniden
Corporation of America, 623 F. Supp. 1485, 1492 (D. Minn. 1985). 
Furthermore, it is a basic tenet of copyright law that only the
expression of an idea may be granted copyright protection, not
the idea.  Atari at 615.

     The importer argues that it does not believe that the EGA
BIOS licensed to it from Genoa Systems Corporation is an
infringement of IBM's copyright.  The importer states that its
belief of non-infringement is based upon a release of a October,
1989 shipment of the same type of merchandise after analysis by a
Customs   

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laboratory.  The importer contends that documents supplied to
Customs in connection with the October, 1989 shipment indicate
that it is a legal licensee of Genoa who in turn is a legal
licensee of Award Software.  The importer states that a license
agreement between its parent, Fontex Corporation, and IBM and a
sales history have been presented to Customs for resolving this
matter.        

     The importer has submitted a laboratory report from Genoa.
The importer states that the report demonstrates how the object
code of Genoa's BIOS was modified so that the program would work
on the laptop computers.

     The importer submitted a November 16, 1989 letter from Mr.
Walter Lin, Director of Engineering, Genoa Systems Corporation,
to Mr. Jeff Flink of Award Software.  This letter concerned the
October, 1989 shipment of laptop computers of the same type prior
to the one in question.  In the letter the discussion centers on
the Award EGA BIOS.  

     Based upon the release of the earlier shipment, the importer
avers that it is an innocent party and it had no reasonable
grounds to believe that the EGA BIOS licensed to CAF would
infringe IBM's copyright.  The importer requests that Customs
permit exportation of the merchandise to the country of
exportation.

     IBM contends that the Genoa BIOS code resident in the laptop
computer infringes its EGA BIOS.  IBM states that the EGA BIOS
became available commercially in October, 1984.  IBM states that
others are free to write programs that will work with or replace
the IBM EGA BIOS, but others are not free to copy without IBM's
consent.

     IBM argues that, although the Genoa BIOS is intended to be
compatible with the IBM EGA BIOS, it would have been impossible
for the Genoa BIOS to be written without the programmer having
access to the information about the IBM EGA BIOS contained in
IBM's copyrighted Technical Reference Manual Options and Adapters
Volume 2.
 
     IBM was provided a sample of the imported Genoa BIOS.  IBM
conducted a test and compared the imported BIOS with the IBM EGA
BIOS ROM.  IBM contends that there is an overwhelming similarity
between the key modules and concludes that it could not be
independently created.  IBM also asserts that major portions were
copied.  IBM states that its EGA BIOS contains approximately
2,574 instructions.  In its side-by-side analysis, IBM compared
1,247 instructions with the Genoa BIOS.  IBM found 578
instructions (46.3 percent) copied identically in the Genoa BIOS. 
IBM contends that this constitutes a substantial taking
sufficient to establish infringement.  Further, IBM argues that
at least another 503 instructions (40.3 percent) are equivalent
to the IBM EGA BIOS.

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     IBM obtained its copyright registration for the EGA Code
BIOS on June 10, 1986.  The importer, while arguing that it
believes that infringement does not exist, does not address the
issue of access to the protected work.  Therefore, we conclude
that the importer did have access to IBM's copyrighted work.  

     The importer states that it has submitted documents to
Customs showing the existence of a license agreement between its
parent, Fontex, and IBM and between it and Genoa.  First, the
file does not include any documents indicating license agreements
between any entities.  Additionally, the importer's reference
that it is a licensee of Genoa who in turn is a licensee of Award
software does not establish any connection with IBM.  Further,
based upon the assertions of the importer, Customs Headquarters
made inquiries into the existence of such documents by contacting
the district office; however, no copyright licensing agreement
was found as a result of the district search into documents the
importer submitted related to this shipment or the October, 1989
shipment.

     Independent of the EGA code BIOS analyses submitted by the
importer and IBM, Customs's laboratory analysis of the imported
EGA code BIOS found 39.61 percent similarity overall with the
protected work.  In view of our conclusion that the importer had
access to the protected work and the laboratory's results as to
the level of overall similarity, we find that this gives rise to
a conclusion of copyright infringement since the importer,
notwithstanding its statements, has not produced any documents
demonstrating IBM's grant of authority to make copies or import
this merchandise.

HOLDING:

     We conclude that the EGA Code BIOS, resident in the imported
laptop computers, infringes IBM copyright, TX 1-869-411 (Customs
Issuance No. 86-207), and that the importation of the EGA Code
BIOS is an unauthorized importation under 17 U.S.C. 602 and is
subject to seizure and forfeiture under 17 U.S.C. 603.  The
laptop computers are subject to seizure and forfeiture under
title 19, United States Code, section 1595a(a), for facilitating
the importation of articles contrary to law.  Under 19 C.F.R.
133.43(d), the district director may now seize the detained









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articles and proceed to forfeiture in accordance with 19 C.F.R.
Part 162 or permit the importer to return the articles to the
country of export if the conditions of 19 C.F.R. 133.47 are met. 
The district director is advised to return the bond to the
copyright owner.

                              Sincerely,
 



                              John F. Atwood, Chief
                              Intellectual Property Rights 
                              Task Force