Just in time for the 4th of July, a Third Circuit Court of Appeals panel struck down a preliminary injunction that protected a Pennsylvania company, Pyrotechnics Management Inc., from a Romanian competitor, FireTek. Pyrotechnics makes hardware and software used for fireworks displays. Pyrotechnics Management, Inc. vs. XFX Pyrotechnics LLC, FireTek, 3d Cir. No. 21-1695 (June 29, 2022). Pyrotechnics sued in federal court to block the distribution of a FireTEK product the U.S. maker said infringed its copyrights. Pyrotechnics developed a proprietary fireworks communications system and protocol used in its Fire One® control panels for launching fireworks field displays.
Blowing Up Copyright Protection of Pennsylvania Pyrotech Company
Just in time for the 4th of July, a Third Circuit Court of Appeals panel struck down a preliminary injunction that protected a Pennsylvania company.
Catherine Cavella, ESQ.
Court of Appeals panel strikes down injunction protecting PA Fireworks Company
Just in time for the 4th of July, a Third Circuit Court of Appeals panel struck down a preliminary injunction that protected a Pennsylvania company, Pyrotechnics Management Inc., from a Romanian competitor, FireTek. Pyrotechnics makes hardware and software used for fireworks displays. Pyrotechnics Management, Inc. vs. XFX Pyrotechnics LLC, FireTek, 3d Cir. No. 21-1695 (June 29, 2022).
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Pyrotechnics sued in federal court to block the distribution of a FireTEK product the U.S. maker said infringed its copyrights. Pyrotechnics developed a proprietary fireworks communications system and protocol used in its Fire One® control panels for launching fireworks field displays.
The communications system used certain digital messages and digital message formats to relay information between the control panel and the field modules. Pyrotechnics alleged FireTek reverse-engineered Pryotechnics’ hardware and then copied it, including copying its proprietary communications system. FireTek used Pyrotechnics’ communications system in a competing control panel product for use with Pyrotechnics’ field modules. Pyrotechnics’ complaint alleged copyright infringement as well as unfair competition and tortious interference.
The District Court granted Pyrotechnic a preliminary injunction on copyright grounds, preventing FireTek from distributing its copycat product. FireTek appealed, arguing Pyrotechnic had no valid copyright in the communications system. The Third Circuit Court of Appeals agreed and vacated the preliminary injunction, citing Southco v. Kanebridge, a 2004 decision holding that Southco’s part numbering system was an unprotectible idea with insufficient creativity to be protected under U.S. Copyright law.
The decision is a blow to U.S. companies with valuable innovations falling in the gray areas between patent, copyright, and trademark law. Patent law protects new, non-obvious, innovations and designs within the boundaries of the granted patent claims; trade secrets law protects valuable ideas and processes that can be kept secret; trademark law protects branding and non-functional, source-identifying aspects of a product; and copyright law protects original creative expression, including software code, but not short words and phrases.
No tool of intellectual property protects mere ideas, methods or processes that are disclosed to the public. But copyright often is the last bulwark of efforts for such protection.
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Copyright does protect compilation, organization, and display of information so long as it involves minimal creative expression. And copyright protection is available under the “merger doctrine”: while copyright does not protect ideas or processes themselves, ideas that have “merged” with copyrightable expression are protected.
As one might expect, interpretations involving the doctrine of merger are highly subjective. In this case, the Court held that the digital messages and message protocol, while original, were insufficiently expressive but were dictated by fixed rules driven by the functional ideas embodied in the Pyrotechnic protocol.
The Court points out two facts weighing heavily in its decision: 1) Pyrotechnics did not seek to register the copyright in the computer code underlying the communications protocol, only the protocol and digital messages themselves, which the Court said “reads like a manual”; and 2) Pyrotechnics filed its copyright registration application 25 years after publication of the communications protocol, too late to benefit from the presumption of validity its copyright would have enjoyed had it filed its application within five years of publication.
Hindsight advice: It is quite possible Pyrotechnic’s copyright would have been upheld if it had sought to register, and deposited, the source or object code driving the communications system. And because registration of computer code covers the screens that are displayed when that code is run, copyright in the code may have been enough to support infringement claims against fireTEK even if Firetek’s code was different – there may have been enough similarity to find a likelihood of success on Pyrotechinc’s copyright infringement claim and affirm the injunction.
With the benefit of hindsight, we can all learn from this case and avoid this unfortunate result. Interpretation of copyright law in the gray areas has been narrowing significantly. Going forward, we practitioners are advised to draft more conservatively and away from the shrinking boundaries of copyright protection.
The Takeaways?
- If you have developed a valuable method, process, or system you cannot keep secret, seriously consider pursuing patent protection before launching, or at least within the first year of disclosure;
- Register copyrights in your valuable computer code within 5 years of release, preferably within 90 days (about 3 months) to enjoy statutory damages; and
- Do not rely on copyright law to protect your “gray area” systems and protocols, forms, and formats, at least in the Third Circuit (Pennsylvania, New Jersey, and Delaware).
Catherine Cavella
