Although SAS Institute Inc v World Programming Ltd.  EWHC 1829 (Ch) (23 July 2010) ended inconclusively (and some say disappointingly) with a preliminary reference to the Court of Justice of the European Union under art 267 of the Treaty on the Functioning of the European Union, this case broke new ground. That is because the trial judge Mr. Justice Arnold held that art 9 (2) of TRIPS and art 2 of the WIPO Copyright Treaty now require courts in the UK to interpret the Copyright Designs and Patents Act1988 so as to protect “expressions” and not “ideas, procedures, methods of operation and mathematical concepts as such”. That is in contrast to the position taken by Mr. Justice Jacob (as he then was) in response to my submissions in Ibcos Computers Ltd v Barclays Mercantile Highland Finance Ltd  FSR. 275 based on the American cases Lotus Dev. Corp. v. Borland Int’l, Inc., 788 F.Supp. 78 and Computer Associates International, Inc. v. Altai, Inc., 982 F.2d 693.
In SAS the defendant, World Programming Ltd (“WPL”), perceived that there would be demand for software that could be able to execute application programs written in the SAS Language. The SAS language is a language in which the claimant, SAS Institute Inc. (“SAS”), had written an integrated set of programs that enabled users to process and analyze data. WPL therefore created a product called World Programming System or WPS to do this. In developing WPS, WPL sought to emulate as much of the functionality of the SAS software as possible. In particular, it set out to ensure that the same inputs produced the same outputs. There was no suggestion that WPL had access to SAS’s source code, that WPL have copied any of the text of that code or that WPL had copied any of its structural design.
The case against WPS was that:
- WPL had copied the manuals for the SAS System published by SAS Institute (“the SAS Manuals”) when creating WPS and thereby infringed the copyright in the SAS Manuals;
- by copying the SAS manuals when creating WPS, WPL had indirectly copied the programs comprising the SAS Components and thereby infringed the copyright in the SAS Components;
- WPL had used a version of the SAS System known as the Learning Edition in contravention of the terms of its licences, and thereby both acted in breach of the relevant contracts and infringed the copyright in the Learning Edition; and
- WPL had infringed the copyright in the SAS Manuals in creating its own documentation, namely a manual (“the WPS Manual”) and some “quick reference” guides.
None of the allegations of fact was seriously challenged.
Relying heavily on Mr. Justice Pumfrey’s decision in Navitaire Inc v easyJet Airline Co Ltd.  EWHC 1725 (Ch),  RPC 3 his lordship was of opinion that, notwithstanding the replication of a large part of the functionality of the SAS Components, there had been no infringement of copyright in those components. WPL had not even reproduced the design of the components let alone the actual source code. As the SAS licence agreement permitted the licensee to use the software on one workstation at a time for self-training and non-production purposes only, the judge took the view that the licence had been exceeded. However, those conclusions were subject to the extent of the protection for computer programs provided by the Software Directive (Council Directive 91/250/EEC of 14 May 1991 on the legal protection of computer programs) and the Information Society Directive (European Parliament and Council Directive 2001/29/EC of 22 May 2001 on the harmonization of certain aspects of copyright and related rights in the information society).
The judge’s conclusions were as follows:
“i) Although I am not persuaded that Pumfrey J was wrong to conclude in Navitaire that, on the true interpretation of Article 1(2) of the Software Directive, copyright in computer programs does not protect programming languages from being copied, I agree with him that this is a question on which guidance from the ECJ is required (see paragraphs 211-218 above).
ii) Although I am not persuaded that Pumfrey J was wrong to conclude in Navitaire that, on the true interpretation of Article 1(2) of the Software Directive, copyright in computer programs does not protect interfaces from being copied where this can be achieved without decompiling the object code, I consider this is also a question on which guidance from the ECJ is required (see paragraphs 219-227 above).
iii) Although I am not persuaded that Pumfrey J was wrong to conclude in Navitaire that, on the true interpretation of Article 1(2) of the Software Directive, copyright in computer programs does not protect the functions of the programs from being copied, and although his decision on that point was upheld by the Court of Appeal in Nova, I consider that this is also a question on which guidance from the ECJ is required (see paragraphs 228-238 above).
iv) On the assumption that Pumfrey J’s interpretation of Article 1(2) of the Software Directive was correct, WPL has not infringed SAS Institute’s copyrights in the SAS Components by producing WPS (see paragraphs 245-250 above).
v) I consider that the reasoning which supports Pumfrey J’s interpretation of Article 1(2) of the Software Directive also applies to Article 2(a) of the Information Society Directive, but again this is a question on which guidance from the ECJ is required (see paragraphs 251-256 above).
vi) On the assumption that Article 2(a) of the Information Society Directive is to be interpreted in the same manner as Article 1(2) of the Software Directive, WPL has not infringed SAS Institute’s copyright in the SAS Manuals by producing or testing WPS (see paragraphs 257-267 above).
vii) WPL’s use of the SAS Learning Edition falls outside the scope of the terms of the relevant licences (see paragraphs 276-290 above).
viii) The interpretation of Article 5(3) of the Software Directive is another question on which guidance from the ECJ is required (see paragraphs 291-311 and 314 above).
ix) On the interpretation of Article 5(3) which I favour, WPL’s use of the Learning Edition is within Article 5(3), and to the extent that the licence terms prevent this they are null and void, with the result that none of WPL’s acts complained of was a breach of contract or an infringement of copyright except perhaps one (see paragraphs 313-315 above).
x) WPL has infringed the copyrights in the SAS Manuals by substantially reproducing them in the WPL Manual (see paragraphs 317-319 above).
xi) WPL has not infringed the copyrights in the SAS Manuals by producing the WPS Guides (see paragraphs 320-329 above).”
23 July 2010 SAS Press Release “Court finds World Programming Ltd. infringed ….”