High Court dismisses application for summary judgment on copyright infringement claim in relation to software for digital signage

HomeInsightsHigh Court dismisses application for summary judgment on copyright infringement claim in relation to software for digital signage

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The claimant, Oysterware Ltd, supplied the defendant, Intentor Ltd, with hardware, software and IT support relating to digital signage. The signage was used in clinical, mainly dental, surgeries. Oysterware brought various claims against Intentor, including for copyright infringement. Oysterware claimed that Intentor had copied the design of its “Embedded Product”, which it defined as “a single homogenous runtime image (as distinct from an operating system) comprising Microsoft code, third party code (e.g. applications and drivers) and the [Oysterware’s] code”.

Oysterware compared the single runtime image to a combination of an app plus an operating system required to run that particular app, as opposed to an operating system, such as Windows, which is used to run a whole computer. It said that Intentor gained unauthorised access to the Embedded Product and then locked Oysterware out from its servers and unlawfully copied the design of the Embedded Product. Oysterware applied for summary judgment on its copyright infringement claim.

Examining what the relevant work was, i.e. what exactly was meant by the “Embedded Product”, and whether copyright subsisted in that work, Recorder Douglas Campbell QC said that the position on the pleadings was “not satisfactory”. Oysterware had provided a definition of the design of the Embedded Product in its skeleton argument, which consisted of a list of components, but in no part of the pleadings did it state that the work relied on was a compilation. Oysterware instead said that it was implicit that it was relying on copyright in a compilation by the reference to “structure” in its amended Particulars of Claim. Recorder Campbell dismissed this argument, saying that the point about copyright in a compilation was the intellectual creation involved in selecting individual elements, which might be standard in themselves. Relying on copyright in a single homogeneous runtime image suggested that all that mattered was the single image, not its components. In addition, Recorder Campbell said that the witness evidence only dealt with a single homogeneous runtime image, which was inconsistent with a claim based on a compilation. Overall, it was not entirely clear exactly what the copyright work being relied on was.

Notwithstanding the lack of clarity on the work, Recorder Campbell went on to consider what, assuming the work was as defined in Oysterware’s skeleton argument, the intellectual creation of the relevant author was in respect of that work. However, again, the evidence was not clear. In fact, Recorder Campbell said that Oysterware had not adduced any specific evidence of any intellectual creation. It had merely set out a list of the steps taken, and an opinion from the ex-employee designer of the “work”.

Recorder Campbell concluded that there was a triable issue as to whether copyright subsisted in the Embedded Product, and he did not believe that Oysterware’s case was so clear-cut that he should grant summary judgment. The application failed on the facts.

As for infringement, and in particular whether the alleged infringement copied the form of expression of the relevant intellectual creation, Recorder Campbell said that, essentially, Intentor had gone through the image removing the Oysterware-specific parts and replaced them with others. He understand Oysterware’s complaint that this amounted to infringement, but he agreed with Intentor that whether infringement was established depended on what gave the software its originality in the first place. Intentor’s evidence showed that about 30% of the software was Oysterware specific and the remaining 70% was standard Microsoft Windows.

Oysterware said that this evidence was not fatal to its case in copyright infringement for two reasons: (i) precise percentages were irrelevant and it did not accept the premise that one could simply split out 30%; and (ii) Oysterware did not only rely on the 30%, which was said to be Oysterware specific. It said that it could win on the basis of the 70% that Intentor had dismissed as standard Microsoft Windows, which had been retained in the Intentor product, because it retained the structure that had been created by the Oysterware designer.

However, in Recorder Campbell’s view, that brought the argument back to Oysterware’s failure to identify precisely what the structure relied upon was and, more substantively, Oysterware’s failure to establish why the development of that particular structure involved any intellectual creation. There was also therefore a triable issue on infringement for the same reasons that there was a triable issue on subsistence.

Before concluding, Recorder Campbell said that he agreed with Intentor that there was a material and significant dispute as to whether what Oysterware was really seeking to protect was, in substance, the functionality of its software. This possibly raised a further issue that also needed to be tried, he said.

The application for summary judgment was dismissed. (Oysterware Ltd v Intentor Ltd [2020] EWHC 2125 (Ch) (21 July 2020) — the judgment is available in full on the Lawtel website).