United States District Court, S.D. West Virginia, Charleston Division
MEMORANDUM OPINION AND ORDER
R. GOODWIN, UNITED STATES DISTRICT JUDGE
before the court is the Defendants' Motion for Summary
Judgment [ECF No. 123]. For the following reasons, the
Defendants' Motion is GRANTED in part
and DENIED in part.
February 23, 2016, CSS, Inc. (“CSS”) filed a
Complaint [ECF No. 1] against Christopher Herrington, Gene
Yoho, and Compiled Technologies, LLC (collectively,
“Defendants”). On September 16, 2016, CSS filed
its First Amended Complaint [ECF No. 59] against the
Defendants, alleging copyright infringement, breach of
contract, violation of the duty of loyalty, tortious
interference with business relationships, unjust enrichment,
and misappropriation of trade secrets.
a company that provides software and related support services
to county clerks' offices in West Virginia. See
Hr'g Tr., Jan. 25, 2017, Auburn Direct, 28:1-9. For over
twenty years, CSS has provided software solutions that
include a land records indexing package, an estate management
package, utility billing, and sheriff's tax collection
applications, among others. See Id. at 28:1-4.
Herrington began his employment with CSS in October 1991.
See Hr'g Tr., Feb. 23, 2017, C. Herrington
Direct, 157:8-12, 190:14-15. Herrington worked in the
computer software, applications, and programming business
related to county government information and document
management systems. See Id. at 157:8-12. For the
majority of his employment with CSS, Herrington worked as a
programmer/developer. See Hr'g Tr., Jan. 25,
2017, Auburn Direct, 14:14-23, 16:22- 17:5. Herrington's
work consisted of the development of CSS's software, bug
fixes, modifications, and providing support services for
CSS's software packages. Id. at 14:14-23,
15:13-23, 16:22-17:5. Specifically, his duties included
programming and support responsibilities for both the land
indexing software and the estate management software.
Id. at 16:2-9.
Herrington resigned as an employee of CSS on August 23, 2014.
See Hr'g Tr., Feb. 23, 2017, C. Herrington
Direct, 190:14-15. On September 6, 2014, Herrington returned
to CSS. See Id. at 203:22-24. On September 12, 2014,
CSS required Christopher Herrington to sign a Confidentiality
Agreement. See Hr'g Tr., Jan. 25, 2017, Auburn
Direct, 44:14-45:2. Prior to September 12, 2014, CSS had
never required Herrington to sign a confidentiality
agreement. See Hr'g Tr., Feb. 23, 2017, McCasker
Redirect, 97:6-17. CSS employed Christopher Herrington until
June 5, 2015. See Hr'g Tr., Feb. 23, 2017, C.
Herrington Direct, 203:22-24.
Yoho formed Compiled Technologies, LLC (“CT”), on
August 12, 2015. See Hr'g Tr., Feb. 24, 2017, C.
Herrington Direct, 43:19-44:5. Gene Yoho and Christopher
Herrington operate CT. See Id. CT provides licensing
for custom computer software applications, including one
program for land records recording and indexing and one
program for estate management. See Id. at 44:3-5. CT
also provides support services to county clerks' offices
related to these applications. See Hr'g Tr.,
Feb. 24, 2017, C. Herrington Cross, 242:9-11. CT competes
with CSS for contracts with West Virginia county clerks.
See Hr'g Tr., Feb. 24, 2017, C. Herrington
First Amended Complaint, CSS alleges that the Defendants
infringed various copyrights relating to its computer
software code for the land indexing and estate management
applications. First Am. Compl. ¶¶ 32-39.
Specifically, CSS alleges that CT's software programs,
which were developed by Christopher Herrington, are
substantially similar to CSS's copyrighted programs. CSS
also alleges that Christopher Herrington breached the
Confidentiality Agreement by using confidential information
to create, market, and sell software and support services to
CSS's customers. Id. at ¶ 43. CSS alleges
that Herrington violated the duty of loyalty by creating
competing products, and soliciting CSS's customers to use
those competing products, while still employed by CSS.
Id. at ¶¶ 47-50. In addition, CSS alleges
that the Defendants tortiously interfered with CSS's
business relationships with actual and potential customers,
that the Defendants misappropriated CSS's trade secrets,
and that the Defendants were unjustly enriched by their
unlawful use and disclosure of confidential information.
Id. at ¶¶ 52-65. Finally, CSS seeks a
declaratory judgment that, under the “works for
hire” doctrine, CSS is the author of any computer
programs developed by Christopher Herrington during his
employment with CSS. Id. at ¶ 75.
November 23, 2016, CSS filed Plaintiff's Motion for
Preliminary Injunction [ECF No. 65], wherein it asserted that
it was likely to succeed on the merits of its copyright
infringement, misappropriation of trade secrets, and breach
of contract claims. The court conducted a hearing on the
Plaintiff's Motion on January 25, February 23, and
February 24, 2017. On August 1, 2017, the court issued a
Memorandum Opinion and Order [ECF No. 209] denying the
Plaintiff's Motion. On August 4, 2017, the court issued
an Amended Memorandum Opinion and Order (“Prelim. Inj.
Op.”) [ECF No. 213] that corrected clerical errors in
the earlier Opinion. In denying the Plaintiff's Motion,
the court found that CSS was not likely to succeed on its
claims for copyright infringement, misappropriation of trade
secrets, or breach of contract.
April 27, 2017, the Defendants filed a Motion for Summary
Judgment [ECF No. 123] and a Memorandum in Support of the
motion [ECF No. 124]. On May 11, 2017, CSS filed a Response
to Defendants' Motion for Summary Judgment [ECF No. 130].
On May 18, 2017, the Defendants filed their Reply [ECF No.
134]. Thus, the Defendants' Motion is ripe for
obtain summary judgment, the moving party must show that
there is no genuine dispute as to any material fact and that
the moving party is entitled to judgment as a matter of law.
Fed.R.Civ.P. 56(a). In considering a motion for summary
judgment, the court will not “weigh the evidence and
determine the truth of the matter.” Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 249 (1986). Instead,
the court will draw any permissible inference from the
underlying facts in the light most favorable to the nonmoving
party. Matsushita Elec. Indus. Co. v. Zenith Radio
Corp., 475 U.S. 574, 587-88 (1986).
the court will view all underlying facts and inferences in
the light most favorable to the nonmoving party, the
nonmoving party nonetheless must offer some “concrete
evidence from which a reasonable juror could return a
verdict” in his or her favor. Anderson, 477
U.S. at 256. Summary judgment is appropriate when the
nonmoving party has the burden of proof on an essential
element of his or her case and does not make, after adequate
time for discovery, a showing sufficient to establish that
element. Celotex Corp. v. Catrett, 477 U.S. 317,
322-23 (1986). The nonmoving party must satisfy this burden
of proof by offering more than a mere “scintilla of
evidence” in support of his or her position.
Anderson, 477 U.S. at 252. Likewise, conclusory
allegations or unsupported speculation, without more, are
insufficient to preclude the granting of a summary judgment
motion. See Dash v. Mayweather, 731 F.3d 303, 311
(4th Cir. 2013); Stone v. Liberty Mut. Ins. Co., 105
F.3d 188, 191 (4th Cir. 1997).
protection subsists . . . in original works of authorship
fixed in any tangible medium of expression . . . from which
they can be perceived, reproduced, or otherwise communicated,
either directly or with the aid of a machine or
device.” 17 U.S.C. § 102(a). Computer programs can
be protected as “literary works.” See
H.R. Rep. No. 1476, 94th Cong., 2d Sess. 54 (1976),
reprinted in 1976 U.S.C.C.A.N. 5659, 5667
(“The term ‘literary works' does not connote
any criterion of literary merit or qualitative value: it
includes . . . computer data bases, and computer programs to
the extent that they incorporate authorship in the
programmer's expression of original ideas, as
distinguished from the ideas themselves.”). Indeed,
“copyright protection can extend to both literal and
non-literal elements of a computer program.” Oracle
Am., Inc. v. Google Inc., 750 F.3d 1339, 1355 (Fed. Cir.
2014). “The literal elements of a computer program are
the source code and object code.” Id.
“The non-literal components of a computer program
include, among other things, the program's sequence,
structure, and organization, as well as the program's
user interface.” Id. at 1355-56.
“[t]he mere fact that a work is copyrighted does not
mean that every element of the work may be protected.”
Feist Publ'ns, Inc. v. Rural Tel. Serv. Co., 499
U.S. 340, 348 (1991). “In no case does copyright
protection for an original work of authorship extend to any
idea, procedure, process, system, method of operation,
concept, principle, or discovery, regardless of the form in
which it is described, explained, illustrated, or embodied in
such work.” 17 U.S.C. § 102(b). In the case of
computer programs, this limitation “is intended, among
other things, to make clear that the expression adopted by
the programmer is the copyrightable element in a computer
program, and that the actual processes or methods embodied in
the program are not within the scope of the copyright
law.” H.R. Rep. No. 1476, 94th Cong., 2d Sess. 54
(1976), reprinted in 1976 U.S.C.C.A.N. 5659, 5670.
remains the sine qua non of copyright; accordingly,
copyright protection may extend only to those components of a
work that are original to the author.” Feist,
499 U.S. at 348. “[H]owever, the originality
requirement is not particularly stringent.”
Id. at 358. “Original, as the term is used in
copyright, means only that the work was independently created
by the author (as opposed to copied from other works), and
that it possesses at least some minimal degree of
creativity.” Id. at 345.
CSS's and CT's Computer Programs
claims of copyright infringement pertain to three of its
computer programs: CSS-Index, CSS-Estate, and CSS-Search.
Each of these programs corresponds, in terms of function, to
one of CT's programs: CT-Index, CT-Estate, and CT-Search,
respectively. The Index programs create and maintain indexes
for recorded documents. Mot. by Defs. for Leave to File Under
Seal Ex. 1, at 3 [ECF No. 70-1] (“McCasker Expert
Report”). The Estate programs process information
related to decedents. Id. The Search programs allow
the public to search for indexed documents online.
CSS's and CT's programs use a client/server
architecture. Client/server describes “a program
relationship in which one program (the client) requests a
service or resource from another program (the server).”
Mot. by Defs. for Leave to File Under Seal Ex. 2
(“Zeidman Expert Report”), Ex. J at 1 [ECF No.
70-2]. The “client side” is also called the
“front end, ” while the “server side”
is also called the “back end.”
parties' programs use three programming languages: COBOL,
Microsoft Visual Basic Version 6 (“VB6”), and C#.
COBOL is an early programming language, introduced in 1959,
that was widely used in the 1970s and 1980s. See
Zeidman Expert Report 3; McCasker Expert Report 25. COBOL is
“exclusively owned, developed and maintained by Micro
Focus, ” and thus is not the intellectual property of
any of the parties in this case. Defs.' Mem. Opp.
Pl.'s Mot. Prelim. Inj. Ex. 9, at 2 [ECF No. 68-9]
(“Letter from Courtney Wood, Associate General Counsel
for Micro Focus”). The server sides of both CSS's
and CT's programs are written in COBOL. Specifically, CSS
uses RM/COBOL version 11, and CT uses RM/COBOL version 12.
CSS's client-side applications are written in VB6, while
CT's client-side applications are written in C#.
contains the following architecture components:
• CSS-Index Client Application: presents the screens and
other user interface components; accepts user inputs;
displays responses back to the user.
• CSS-Search Client Application: launches when a user
clicks “Inquiry” from within the CSS-Index Client
• CSS Network Communication Interface (VanGUI): bridges
communication between the client application and the back-end
COBOL programs; runs over Transmission Control Protocol
(“TCP”) sockets; built using VanGUI interface.
• CSS-Index Application Server: reads, writes, updates,
and deletes records in the permanent COBOL data files; writes
records to temporary COBOL data files.
• CSS-Index Persistent Data Repository: comprises the
permanent COBOL data files. When a user enters information in
the CSS-Index Client Application and clicks “save,
” the information is sent to a COBOL program that
manipulates the information and saves it into one or more
permanent data files.
• CSS Report Engine (Crystal Reports): uses report
definition files to execute reports, which in turn access
data using an Open Database Connectivity (“ODBC”)
• CSS Data Bridge (Relativity Server): provides an
application with access to COBOL data files via an ODBC
• CSS-Index Reporting Data Repository: temporary data
files that contain the data that will be used in a report
requested by the user.
McCasker Expert Report 7-9.
contains the following architecture components: CT-Index
Client Application; CT-Search Client Application; CT Network
Communication Interface (Louis); CT-Index Application Server;
CT-Index Persistent Data Repository; CT Report Engine
(Crystal Reports); CT Data Bridge (Relativity Server);
CT-Index Reporting Data Repository. Id. at 9-11. The
description of each of these components is essentially the
same as that of the corresponding component of CSS-Index
described above. See Id. One notable difference is
that the CSS Network Communication Interface uses the
communication middleware VanGUI, while the CT Network
Communication Interface uses Louis.
is a communication middleware that allows back-end
applications written in COBOL to communicate with graphical
user interface (“GUI”) front-end applications
written in programming languages that support VB6. Letter
from Courtney Wood, Associate General Counsel for Micro Focus
6-7. VanGUI is a third-party component that is not the
intellectual property of any of the parties in this case.
Louis is an interface builder that works in conjunction with
COBOL platforms and GUIs. Louis is “exclusively owned,
developed and maintained by Micro Focus, ” and
therefore is not the intellectual property of any of the
parties in this case. Id. at 2.
other third-party components used by both of these programs
are Relativity and Crystal Reports. Relativity is a data
access middleware product that improves access to data stored
in COBOL applications. Id. at 4-5. Specifically,
Relativity is an ODBC-accessible relational database
management system. Id. It is a COBOL-specific
database engine/driver that is “exclusively owned,
developed and maintained by Micro Focus.” Id.
at 2. Crystal Reports is a business intelligence application
that helps generate reports, and is not the intellectual
property of any of the parties in this case. Zeidman Expert
Report, Ex. H at 2.
CSS-Search program can either be launched from within the
CSS-Index program, or it can run independently. McCasker
Expert Report 13. The same is true of the CT-Search program.
Id. The architecture components of these two
programs have already been described within the description
of the CSS-Index and CT-Index programs. See Id. The
architecture components of the CSS-Estate and CT-Estate
programs are very similar to those of the CSS-Index and
CT-Index programs, as described above, so I will not repeat
them here. Id. at 14-15.
particular features of these programs require further
explanation. First, both companies' programs contain a
name search algorithm that allows a user to search for
records stored on the server using an individual's name.
Id. at 23. Both programs store an individual's
name in the permanent COBOL data files in two different ways:
exactly as entered by the user (e.g., first, middle, and last
names), and with all spaces and punctuation removed
(“letters-only”). Id. When a user
initiates a search using the individual's first, middle,
and/or last name, the server converts the name into the
letters-only version to conduct the search through the data
both companies' programs contain a single entry point to
perform both login validation and password change.
Id. at 24. In both cases, the client application
requests the following information from the user: username,
password, new password, confirm new password. Id. at
23-24. The server then validates the login by comparing the
username and password against records in a COBOL data file.
Id. at 24. If the login is validated, the program
looks to see if a new password was entered. Id. If
so, the program compares the “new password” entry
with the “confirm new password” entry.
Id. If the entries match, the server updates the
password in the COBOL data files with the new password and
then exits. Id.
CSS's Copyright Ownership and the Defendants'
establish a claim for copyright infringement, a plaintiff
must prove that it owned a valid copyright and that the
defendant copied the original elements of that
copyright.” Humphreys & Partners Architects,
L.P. v. Lessard Design, Inc., 790 F.3d 532, 537 (4th
Cir. 2015) (quoting Lyons P'ship, L.P. v. Morris
Costumes, Inc., 243 F.3d 789, 801 (4th Cir. 2001)). A
certificate of copyright registration is prima facie evidence
of the validity of the copyright. 17 U.S.C. § 410(c).
the registered owner of three copyrights relating to its
computer programs: Document Indexing and Imaging for Counties
2015 (TX 8-230-758) (i.e., CSS-Index), Estate Management 2015
(TX 8-230-809) (i.e., CSS-Estate), and Web Inquiry 2013 (TX
8-230-816) (i.e., CSS-Search). The Defendants do not dispute
the validity of these copyrights in their Motion for Summary
Judgment or Memorandum in Support. Therefore, I
FIND that CSS owns valid copyrights in its
computer programs, and I turn to the issue of copying.
alleges that the Defendants committed copyright infringement
by copying the non-literal elements of its computer
software. To establish copying through
circumstantial evidence, CSS must prove that the Defendants
“had access to the work and that the supposed copy is
substantially similar to [CSS's] original work.”
Humphreys, 790 F.3d at 537 (quoting Bouchat v.
Balt. Ravens, Inc., 241 F.3d 350, 353-54 (4th Cir.
2001)). The Defendants do not dispute that they had access to
CSS's software code, and the evidence of such access is
clear. Christopher Herrington worked for CSS as a
programmer/developer for almost twenty-four years. He was
responsible for developing computer programs, programming
software solutions, and servicing the software for CSS's
clients. In the course of his employment with CSS,
Christopher Herrington worked directly with CSS's
copyrighted computer programs. Accordingly, I
FIND that the Defendants had access to
CSS's copyrighted works. I now must determine whether the
Defendants' computer programs are substantially similar
to CSS's original works.
Substantial Similarity and the AFC Test
argues that CT's software programs copy the structure,
architecture, and transactional flow of CSS's software
programs. In his report, CSS's expert, Andrew McCasker,
found that the two Index programs use the same architecture,
the two Estate programs use the same architecture, and the
two Search programs use the same architecture. Id.
at 26. In addition, CSS notes that both companies'
programs contain the following elements: use of the COBOL
programming language on the back end, COBOL data files,
temporary data files, Crystal Reports, Relativity, “the
same or nearly identical network interface used to
communicate with the back end, ” “the same
grouping for its business logic and reporting logic, ”
“the same unique back-end structure to [their] log-in
and password change functions, ” “and a unique
name stripping search algorithm.” Pl.'s Resp.
Defs.' Mot. Summ. J. 16.
begin by noting “that the application of copyright law
in the computer context is often a difficult task.”
Oracle Am., 750 F.3d at 1354. The Fourth Circuit has
not yet established a test for determining substantial
similarity of the non-literal elements of computer
programs. Many jurisdictions endorse the Second
Circuit's abstraction-filtration-comparison test
(“AFC Test”) to address this issue. See
Comput. Assocs. Int'l, Inc. v. Altai, Inc., 982 F.2d
693, 706-11 (2d Cir. 1992) (outlining the AFC test). The
Fifth, Ninth, Tenth, and Eleventh Circuits apply the AFC
Test. See Gen. Universal Sys., Inc. v. Lee, 379 F.3d
131, 142 (5th Cir. 2004); MiTek Holdings, Inc. v. Arce
Eng'g Co., 89 F.3d 1548, 1559 (11th Cir. 1996);
Gates Rubber Co. v. Bandon Chem. Indus., Ltd., 9
F.3d 823, 833 (10th Cir. 1993); Sega Enters. Ltd. V.
Accolade, Inc., 977 F.2d 1510, 1525 (9th Cir. 1992). The
Sixth Circuit also uses a similar test. See Lexmark
Int'l, Inc. v. Static Control Components, Inc., 387
F.3d 522, 534 (6th Cir. 2004). The First Circuit, in a case
of first impression, viewed the AFC Test favorably, but
ultimately did not rely on it because the case involved
literal (rather than non-literal) infringement of computer
software. See Lotus Dev. Corp. v. Borland Int'l
Inc., 49 F.3d 807, 814-15 (1st Cir. 1995).
Second Circuit designed the AFC Test to address the
complexities of determining substantial similarity that
“result from the hybrid nature of a computer program,
which, while it is literary expression, is also a highly
functional, utilitarian component in the larger process of
computing.” Comput. Assocs. Int'l, 982
F.2d at 712. Essentially, the test is applied as follows:
In ascertaining substantial similarity under this approach, a
court would first break down the allegedly infringed program
into its constituent structural parts. Then, by examining
each of these parts for such things as incorporated ideas,
expression that is necessarily incidental to those ideas, and
elements that are taken from the public domain, a court would
then be able to sift out all non-protectable material. Left
with a kernel, or possible kernels, of creative expression
after following this process of elimination, the court's
last step would be to compare this material with the
structure of an allegedly infringing program. The result of
this comparison will determine whether the protectable
elements of the programs at issue are substantially similar
so as to warrant a finding of infringement.
Id. at 706.
Second Circuit recognized, “[t]his approach breaks no
new ground; rather, it draws on such familiar copyright
doctrines as merger, scenes a faire, and public
domain.” Id. Indeed, the AFC Test “has
the major advantage of being entirely consistent with the
infringement calculus used for infringement issues concerning
other types of works. In effect, it is an adaptation of the
traditional infringement test to the medium of computer
programs.” Howard B. Abrams, Copying of
Protected Expression-Technology, Functionality and
the Ordinary Observer Test- Commentary, 2 The Law of
Copyright § 14:33 (2016). Accordingly, I will apply the
AFC Test to determine whether CT's software programs are
substantially similar to the protectable elements of
CSS's software programs.
Step One: Abstraction
first step in determining whether the non-literal elements of
the computer programs are substantially similar is
Initially, in a manner that resembles reverse engineering on
a theoretical plane, a court should dissect the allegedly
copied program's structure and isolate each level of
abstraction contained within it. This process begins with the
code and ends with an articulation of the program's
ultimate function. Along the way, it is necessary essentially
to retrace and map each of the designer's steps-in the
opposite order in which they were taken during the
Comput. Assocs. Int'l, 982 F.2d at 707.
At the lowest level of abstraction, a computer program may be
thought of in its entirety as a set of individual
instructions organized into a hierarchy of modules. At a
higher level of abstraction, the instructions in the
lowest-level modules may be replaced conceptually by the
functions of those modules. At progressively higher levels of
abstraction, the functions of higher-level modules
conceptually replace the implementations of those modules in
terms of lower-level modules and instructions, until finally,
one is left with nothing but the ultimate function of the
program. . . . A program has structure at every level ...