The circular route of intellectual property

15 years reviewed: Ken Moon.

Ken Moon

In 1986 the big issue for my law firm AJ Park and for me in particular was whether software developers could be protected against piracy. The Copyright Act then in force said nothing about computer programs.

At the time I was advising IBM on what they might do about the importation of clones of their XT and AT personal computers (remember them?). The clones we were after were those which had BIOS chips which used copied IBM BIOS code. One importer of such machines refused to stop and in what was my biggest case we obtained a decision of the High Court that source code was “literary work” under the Copyright Act and therefore protected and copies of adaptations (object code) of that work infringed copyright. (IBM v Computer Imports).

It is interesting today to see that IBM is putting substantial investment into “open source” whereas the cloning problem of the 1980's was due to its deliberate choice to adopt the then new concept of “open architecture”.

Despite a new Copyright Act coming into being as recently as 1995 I find myself again scrutinising our copyright law to assess its shortfalls in protecting authors in the internet age. The Ministry of Economic Development has sought comment in response to an issues paper which may lead to amendments to the Copyright Act. One of the most important issues raised is whether the Copyright Act gives to authors the exclusive right to control the communication of their works through the internet.

For decades at AJ Park we had found ourselves advising engineers that if they implemented a control function in hardware, the investment involved could be protected by a patent, but if they implemented using a program-controlled microprocessor, patent protection may not be available. This was due to a long-standing policy of the New Zealand Patent Office (now Intellectual Property Office) in refusing to grant patents for software inventions. It was therefore with some satisfaction that at a hearing in 1995 I managed to persuade the hearing officer that software inventions should be patentable in New Zealand (Hughes Aircraft Corporation’s patent applications). More controversially, the rise of e-commerce has prompted today’s issue of whether business methods should be patentable.

One area which has changed less dramatically is that of software contract law. This moves forward incrementally as new business models arise. A website developer agreement is not vastly different from a software development agreement. Nonetheless in the late 1970's, when I first started drafting software agreements, there were very few people in New Zealand to learn from and to discuss problems.

I am fortunate to currently be vice chairman of one of the forums of IT law that has thankfully arisen since, namely the International Bar Association’s E-Commerce Law Committee. I am sure it is of some comfort to New Zealand IT industry to know that today the lawyers they consult no longer need to give advice and draft agreements off the seat of their pants.

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