CITE:  49 F.3d 807
CMON:  March 1995
PLAIN: Lotus Development Corporation
DEFND: Borland International
COURT: United States Court of Appeals for the First Circuit
DATE:  March 9, 1995
HISTORY:

Appeal from the United States District Court for the District of
Massachusetts. Hon. Robert E. Keeton, U.S. District Judge.  Decision
corrected March 23, 1995.

SUMMARY:
  User interface menu hierarchies are methods of operation, and not
  copyrightable.  "Expressive choices" for menu names do not 
  "magically" make uncopyrightable menu hierarchies copyrightable.
  Many ways of operating a computer program does not make any one
  way copyrightable.

JUDGE: STAHL, Circuit Judge
Before Torruella, Chief Judge, Boudin and Stahl, Circuit Judges.

DECISION:

This appeal requires us to decide whether a computer menu command hierarchy
is copyrightable subject matter. In particular, we must decide whether,
as the district court held, plaintiff-appellee Lotus Development
Corporation's copyright in Lotus 1-2-3, a computer spreadsheet program,
was infringed by defendant-appellant Borland International, Inc., when
Borland copied the Lotus 1-2-3 menu command hierarchy into its Quattro
and Quattro Pro computer spreadsheet programs. See Lotus Dev. Corp. v.
Borland Int'l, Inc., 788 F. Supp. 78 (D. Mass. 1992) ("Borland I");
Lotus Dev. Corp. v. Borland Int'l, Inc., 799 F. Supp. 203 (D. Mass. 1992)
("Borland II"); Lotus Dev. Corp. v. Borland Int'l, Inc., 831 F. Supp. 202
(D. Mass. 1993) ("Borland III"); Lotus Dev. Corp. v. Borland Int'l, Inc.,
831 F. Supp. 223 (D. Mass. 1993) ("Borland IV").


I.

Background

Lotus 1-2-3 is a spreadsheet program that enables users to perform
accounting functions electronically on a computer. Users manipulate
and control the program via a series of menu commands, such as "Copy",
"Print", and "Quit".  Users choose commands either by highlighting them
on the screen or by typing their first letter. In all, Lotus 1-2-3 has
469 commands arranged into more than 50 menus and submenus.

Lotus 1-2-3, like many computer programs, allows users to write what are
called "macros." By writing a macro, a user can designate a series of command
choices with a single macro keystroke. Then, to execute that series of
commands in multiple parts of the spreadsheet, rather than typing the whole
series each time, the user only needs to type the single pre-programmed
macro keystroke, causing the program to recall and perform the designated
series of commands automatically. Thus, Lotus 1-2-3 macros shorten the time
needed to set up and operate the program.

Borland released its first Quattro program to the public in 1987, after
Borland's engineers had labored over its development for nearly three years.
Borland's objective was to develop a spreadsheet program far superior to
existing programs, including Lotus 1-2-3. In Borland's words, "from the
time of its initial release . . . Quattro included enormous innovations
over competing spreadsheet products."

The district court found, and Borland does not now contest, that Borland
included in its Quattro and Quattro Pro version 1.0 programs "a virtually
identical copy of the entire 1-2-3 menu tree".  Borland III, 831 F. Supp.
at 212 (emphasis in original).  In so doing, Borland did not copy any of
Lotus's underlying computer code; it copied only the words and structure
of Lotus's menu command hierarchy. Borland included the Lotus menu command
hierarchy in its programs to make them compatible with Lotus 1-2-3 so that
spreadsheet users who were already familiar with Lotus 1-2-3 would be able
to switch to the Borland programs without having to learn new commands or 
rewrite their Lotus macros.

In its Quattro and Quattro Pro version 1.0 programs, Borland achieved
compatibility with Lotus 1-2-3 by offering its users an alternate user
interface, the "Lotus Emulation Interface".  By activating the Emulation
Interface, Borland users would see the Lotus menu commands on their screens
and could interact with Quattro or Quattro Pro as if using Lotus 1-2-3,
albeit with a slightly different looking screen and with many Borland
options not available on Lotus 1-2-3. In effect, Borland allowed users to
choose how they wanted to communicate with Borland's spreadsheet programs:
either by using menu commands designed by Borland, or by using the commands
and command structure used in Lotus 1-2-3 augmented by Borland-added
commands.

Lotus filed this action against Borland in the District of Massachusetts
on July 2, 1990, four days after a district court held that the Lotus
1-2-3 "menu structure, taken as a whole -- including the choice of command
terms [and] the structure and order of those terms", was protected expression
covered by Lotus's copyrights.  Lotus Dev. Corp. v. Paperback Software Int'l,
740 F. Supp. 37, 68, 70 (D. Mass. 1990) ("Paperback"). {n1}  Three days
earlier, on the morning after the Paperback decision, Borland had filed
a declaratory judgment action against Lotus in the Northern District of
California, seeking a declaration of non-infringement. On September 10,
1990, the district court in California dismissed Borland's declaratory
judgment action in favor of this action.

Lotus and Borland filed cross motions for summary judgment; the district
court denied both motions on March 20, 1992, concluding that "neither party's
motion is supported by the record."  Borland I, 788 F. Supp. at 80.
The district court invited the parties to file renewed summary judgment
motions that would "focus their arguments more precisely" in light of
rulings it had made in conjunction with its denial of their summary
judgment motions.  Id. at 82. Both parties filed renewed motions for
summary judgment on April 24, 1992. In its motion, Borland contended that
the Lotus 1-2-3 menus were not copyrightable as a matter of law and that
no reasonable trier of fact could find that the similarity between its
products and Lotus 1-2-3 was sufficient to sustain a determination of
infringement. Lotus contended in its motion that Borland had copied
Lotus 1-2-3's entire user interface and had thereby infringed Lotus's
copyrights.

On July 31, 1992, the district court denied Borland's motion and granted
Lotus's motion in part. The district court ruled that the Lotus menu
command hierarchy was copyrightable expression because

    [a] very satisfactory spreadsheet menu tree can be constructed using
    different commands and a different command structure from those of
    Lotus 1-2-3. In fact, Borland has constructed just such an alternate
    tree for use in Quattro Pro's native mode. Even if one holds the
    arrangement of menu commands constant, it is possible to generate
    literally millions of satisfactory menu trees by varying the menu
    commands employed.

Borland II, 799 F. Supp. at 217. The district court demonstrated this by
offering alternate command words for the ten commands that appear in Lotus's
main menu. Id. For example, the district court stated that "the 'Quit' command
could be named 'Exit' without any other modifications", and that "the 'Copy'
command could be called 'Clone', 'Ditto', 'Duplicate', 'Imitate', 'Mimic',
'Replicate', and 'Reproduce', among others." Id. Because so many variations
were possible, the district court concluded that the Lotus developers'
choice and arrangement of command terms, reflected in the Lotus menu
command hierarchy, constituted copyrightable expression.

In granting partial summary judgment to Lotus, the district court held that
Borland had infringed Lotus's copyright in Lotus 1-2-3:

    As a matter of law, Borland's Quattro products infringe the Lotus
    1-2-3 copyright because of (1) the extent of copying of the 
    "menu commands" and "menu structure" that is not genuinely disputed in
    this case, (2) the extent to which the copied elements of the "menu
    commands" and "menu structure" contain expressive aspects separable
    from the functions of the "menu commands" and "menu structure", and
    (3) the scope of those copied expressive aspects as an integral part
    of Lotus 1-2-3.

Borland II, 799 F. Supp. at 223 (emphasis in original). The court nevertheless
concluded that while the Quattro and Quattro Pro programs infringed Lotus's
copyright, Borland had not copied the entire Lotus 1-2-3 user interface, as
Lotus had contended. Accordingly, the court concluded that a jury trial was
necessary to determine the scope of Borland's infringement, including whether
Borland copied the long prompts {n2} of Lotus 1-2-3, whether the long prompts
contained expressive elements, and to what extent, if any, functional
constraints limited the number of possible ways that the Lotus menu command
hierarchy could have been arranged at the time of its creation. See Borland
III, 831 F. Supp. at 207. Additionally, the district court granted Lotus
summary judgment on Borland's affirmative defense of waiver, but not on its
affirmative defenses of laches and estoppel.  Borland II, 799 F. Supp. at
222-23.

Immediately following the district court's summary judgment decision,
Borland removed the Lotus Emulation Interface from its products.
Thereafter, Borland's spreadsheet programs no longer displayed the Lotus
1-2-3 menus to Borland users, and as a result Borland users could no
longer communicate with Borland's programs as if they were using a more
sophisticated version of Lotus 1-2-3. Nonetheless, Borland's programs
continued to be partially compatible with Lotus 1-2-3, for Borland
retained what it called the "Key Reader" in its Quattro Pro programs.
Once turned on, the Key Reader allowed Borland's programs to understand
and perform some Lotus 1-2-3 macros. {n3}  With the Key Reader on, the
Borland programs used Quattro Pro menus for display, interaction, and macro
execution, except when they encountered a slash ("/") key in a macro (the
starting key for any Lotus 1-2-3  [*812]  macro), in which case they
interpreted the macro as having been written for Lotus 1-2-3. Accordingly,
people who wrote or purchased macros to shorten the time needed to perform
an operation in Lotus 1-2-3 could still use those macros in Borland's
programs. {n4}  The district court permitted Lotus to file a supplemental
complaint alleging that the Key Reader infringed its copyright.

The parties agreed to try the remaining liability issues without a jury.
The district court held two trials, the Phase I trial covering all
remaining issues raised in the original complaint (relating to the
Emulation Interface) and the Phase II trial covering all issues raised
in the supplemental complaint (relating to the Key Reader). At the Phase
I trial, there were no live witnesses, although considerable testimony
was presented in the form of affidavits and deposition excerpts. The
district court ruled upon evidentiary objections counsel interposed.
At the Phase II trial, there were two live witnesses, each of whom 
demonstrated the programs for the district court.

After the close of the Phase I trial, the district court permitted Borland
to amend its answer to include the affirmative defense of "fair use".
Because Borland had presented all of the evidence supporting its fair-use
defense during the Phase I trial, but Lotus had not presented any evidence
on fair use (as the defense had not been raised before the conclusion of
the Phase I trial), the district court considered Lotus's motion for
judgment on partial findings of fact. See Fed. R. Civ. P. 52(c). The
district court held that Borland had failed to show that its use of the
Lotus 1-2-3 menu command hierarchy in its Emulation Interface was a fair
use. See Borland III, 831 F. Supp. at 208.

In its Phase I-trial decision, the district court found that "each of the
Borland emulation interfaces contains a virtually identical copy of the 1-2-3
menu tree and that the 1-2-3 menu tree is capable of a wide variety of
expression." Borland III, 831 F. Supp. at 218. The district court also
rejected Borland's affirmative defenses of laches and estoppel.  Id. at
218-23.

In its Phase II-trial decision, the district court found that Borland's
Key Reader file included "a virtually identical copy of the Lotus menu
tree structure, but represented in a different form and with first letters
of menu command names in place of the full menu command names." Borland
IV, 831 F. Supp. at 228. In other words, Borland's programs no longer
included the Lotus command terms, but only their first letters. The
district court held that "the Lotus menu structure, organization, and
first letters of the command names . . . constitute part of the
protectable expression found in [Lotus 1-2-3]." Id. at 233. Accordingly,
the district court held that with its Key Reader, Borland had infringed
Lotus's copyright.  Id. at 245. The district court also rejected Borland's
affirmative defenses of waiver, laches, estoppel, and fair use. Id. at
235-45. The district court then entered a permanent injunction against
Borland, id. at 245, from which Borland appeals.

This appeal concerns only Borland's copying of the Lotus menu command
hierarchy into its Quattro programs and Borland's affirmative defenses
to such copying. Lotus has not cross-appealed; in other words, Lotus does
not contend on appeal that the district court erred in finding that
Borland had not copied other elements of Lotus 1-2-3, such as its
screen displays.


II.


Discussion

On appeal, Borland does not dispute that it factually copied the words
and arrangement of the Lotus menu command hierarchy. Rather, Borland
argues that it "lawfully copied the unprotectable menus of Lotus 1-2-3".
Borland contends that the Lotus menu command hierarchy is not copyrightable
because it is a system, method of operation, process, or procedure
foreclosed from protection by 17 U.S.C. 102(b). Borland also raises a
number of affirmative defenses.


A. Copyright Infringement Generally


To establish copyright infringement, a plaintiff must prove "(1) ownership
of a valid copyright, and (2) copying of constituent elements of the work
that are original".  Feist Publications, Inc. v. Rural Tel. Serv. Co.,
499 U.S. 340, 361, 113 L. Ed. 2d 358, 111 S. Ct. 1282 (1991); see also
Data Gen. Corp. v. Grumman Sys. Support Corp., 36 F.3d 1147, 1160 n.19
(1st Cir. 1994); Concrete Mach. Co. v. Classic Lawn Ornaments, Inc., 
843 F.2d 600, 605 (1st Cir. 1988). To show ownership of a valid copyright
and therefore satisfy Feist's first prong, a plaintiff must prove that
the work as a whole is original and that the plaintiff complied with
applicable statutory formalities. See Engineering Dynamics, Inc. v.
Structural Software, Inc., 26 F.3d 1335, 1340 (5th Cir. 1994). "In judicial
proceedings, a certificate of copyright registration constitutes prima facie
evidence of copyrightability and shifts the burden to the defendant to
demonstrate why the copyright is not valid." Bibbero Sys., Inc. v. Colwell
Sys., Inc., 893 F.2d 1104, 1106 (9th Cir. 1990); see also 17 U.S.C. 410(c);
Folio Impressions, Inc. v. Byer California, 937 F.2d 759, 763 (2d Cir. 1991)
(presumption of validity may be rebutted).

To show actionable copying and therefore satisfy Feist's second prong, a
plaintiff must first prove that the alleged infringer copied plaintiff's
copyrighted work as a factual matter; to do this, he or she may either
present direct evidence of factual copying or, if that is unavailable,
evidence that the alleged infringer had access to the copyrighted work
and that the offending and copyrighted works are so similar that the 
court may infer that there was factual copying (i.e., probative similarity).
Engineering Dynamics, 26 F.3d at 1340; see also Concrete Mach., 843 F.2d
at 606. The plaintiff must then prove that the copying of copyrighted
material was so extensive that it rendered the offending and copyrighted
works substantially similar. See Engineering Dynamics, 26 F.3d at 1341.

In this appeal, we are faced only with whether the Lotus menu command
hierarchy is copyrightable subject matter in the first instance, for Borland
concedes that Lotus has a valid copyright in Lotus 1-2-3 as a whole {n5}
and admits to factually copying the Lotus menu command hierarchy. As a
result, this appeal is in a very different posture from most copyright
infringement cases, for copyright infringement generally turns on whether
the defendant has copied protected expression as a factual matter. Because
of this different posture, most copyright infringement cases provide only
limited help to us in deciding this appeal. This is true even with respect
to those copyright infringement cases that deal with computers and
computer software.


B. Matter of First Impression

Whether a computer menu command hierarchy constitutes copyrightable subject
matter is a matter of first impression in this court. While some other courts
appear to have touched on it briefly in dicta, see, e.g., Autoskill, Inc. v.
National Educ. Support Sys., Inc., 994 F.2d 1476, 1495 n.23 (10th Cir.),
cert. denied, 126 L. Ed. 2d 254, 114 S. Ct. 307 (1993), we know of no cases
that deal with the copyrightability of a menu command hierarchy standing
on its own (i.e., without other elements of the user interface, such as
screen displays, in issue). Thus we are navigating in uncharted waters.

Borland vigorously argues, however, that the Supreme Court charted our
course more than 100 years ago when it decided Baker v. Selden, 101 U.S.
99, 25 L. Ed. 841 (1879). In Baker v. Selden, the Court held that Selden's
copyright over the textbook in which he explained his new way to do
accounting did not grant him a monopoly on the use of his accounting
system. {n6}  Borland argues:

    The facts of Baker v. Selden, and even the arguments advanced by
    the parties in that case, are identical to those in this case. The
    only difference is that the "user interface" of Selden's system
    was implemented by pen and paper rather than by computer.

To demonstrate that Baker v. Selden and this appeal both involve accounting
systems, Borland even supplied this court with a video that, with special
effects, shows Selden's paper forms "melting" into a computer screen and
transforming into Lotus 1-2-3.

We do not think that Baker v. Selden is nearly as analogous to this appeal
as Borland claims. Of course, Lotus 1-2-3 is a computer spreadsheet, and
as such its grid of horizontal rows and vertical columns certainly
resembles an accounting ledger or any other paper spreadsheet. Those
grids, however, are not at issue in this appeal for, unlike Selden,
Lotus does not claim to have a monopoly over its accounting system.
Rather, this appeal involves Lotus's monopoly over the commands it uses
to operate the computer. Accordingly, this appeal is not, as Borland
contends, "identical" to Baker v. Selden.


C. Altai

Before we analyze whether the Lotus menu command hierarchy is a system,
method of operation, process, or procedure, we first consider the
applicability of the test the Second Circuit set forth in Computer Assoc.
Int'l, Inc. v. Altai, Inc., 982 F.2d 693 (2d Cir. 1992). {n7}  The Second
Circuit designed its Altai test to deal with the fact that computer
programs, copyrighted as "literary works", can be infringed by what is
known as "nonliteral" copying, which is copying that is paraphrased or
loosely paraphrased rather than word for word. See id. at 701 (citing
nonliteral-copying cases); see also 3 Melville B. Nimmer & David Nimmer,
Nimmer on Copyright Section 13.03[A][1] (1993). When faced with
nonliteral-copying cases, courts must determine whether similarities
are due merely to the fact that the two works share the same underlying
idea or whether they instead indicate that the second author copied the
first author's expression. The Second Circuit designed its Altai test
to deal with this situation in the computer context, specifically with
whether one computer program copied nonliteral expression from another
program's code.

The Altai test involves three steps: abstraction, filtration, and comparison.
The abstraction step requires courts to "dissect the allegedly copied
program's structure and isolate each level of abstraction contained within
it." Altai, 982 F.2d at 707. This step enables courts to identify the
appropriate framework within which to separate protectable expression
from unprotected ideas. Second, courts apply a "filtration" step in which
they examine "the structural components at each level of abstraction to
determine whether their particular inclusion at that level was 'idea' or
was dictated by considerations of efficiency, so as to be necessarily
incidental to that idea; required by factors external to the program
itself; or taken from the public domain." Id. Finally, courts compare
the protected elements of the infringed work (i.e., those that survived
the filtration screening) to the corresponding elements of the allegedly
infringing work to determine whether there was sufficient copying of
protected material to constitute infringement.  Id. at 710.

In the instant appeal, we are not confronted with alleged nonliteral
copying of computer code. Rather, we are faced with Borland's deliberate,
literal copying of the Lotus menu command hierarchy. Thus, we must
determine not whether nonliteral copying occurred in some amorphous
sense, but rather whether the literal copying of the Lotus menu command
hierarchy constitutes copyright infringement.

While the Altai test may provide a useful framework for assessing the alleged
nonliteral copying of computer code, we find it to be of little help in
assessing whether the literal copying of a menu command hierarchy constitutes
copyright infringement. In fact, we think that the Altai test in this context
may actually be misleading because, in instructing courts to abstract the
various levels, it seems to encourage them to find a base level that includes
copyrightable subject matter that, if literally copied, would make the copier
liable for copyright infringement. {n8}  While that base (or literal)
level would not be at issue in a nonliteral-copying case like Altai,
it is precisely what is at issue in this appeal. We think that abstracting
menu command hierarchies down to their individual word and menu levels
and then filtering idea from expression at that stage, as both the Altai
and the district court tests require, obscures the more fundamental
question of whether a menu command hierarchy can be copyrighted at all.
The initial inquiry should not be whether individual components of a
menu command hierarchy are expressive, but rather whether the menu
command hierarchy as a whole can be copyrighted. But see Gates Rubber Co.
v. Bando Chem. Indus., Ltd., 9 F.3d 823 (10th Cir. 1993) (endorsing Altai's
abstraction-filtration-comparison test as a way of determining whether
"menus and sorting criteria" are copyrightable).


D. The Lotus Menu Command Hierarchy: A "Method of Operation"

Borland argues that the Lotus menu command hierarchy is uncopyrightable
because it is a system, method of operation, process, or procedure
foreclosed from copyright protection by 17 U.S.C. 102(b). Section 102(b)
states: "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."
Because we conclude that the Lotus menu command hierarchy is a method
of operation, we do not consider whether it could also be a system,
process, or procedure.

We think that "method of operation", as that term is used in 102(b),
refers to the means by which a person operates something, whether it be
a car, a food processor, or a computer. Thus a text describing how to
operate something would not extend copyright protection to the method
of operation itself; other people would be free to employ that method
and to describe it in their own words.  Similarly, if a new method of
operation is used rather than described, other people would still be
free to employ or describe that method.

We hold that the Lotus menu command hierarchy is an uncopyrightable "method
of operation".  The Lotus menu command hierarchy provides the means by which
users control and operate Lotus 1-2-3. If users wish to copy material, for
example, they use the "Copy" command. If users wish to print material, 
they use the "Print" command. Users must use the command terms to tell
the computer what to do. Without the menu command hierarchy, users would
not be able to access and control, or indeed make use of, Lotus 1-2-3's
functional capabilities.

The Lotus menu command hierarchy does not merely explain and present Lotus
1-2-3's functional capabilities to the user; it also serves as the method
by which the program is operated and controlled. The Lotus menu command
hierarchy is different from the Lotus long prompts, for the long prompts
are not necessary to the operation of the program; users could operate
Lotus 1-2-3 even if there were no long prompts. {n9}  The Lotus menu
command hierarchy is also different from the Lotus screen displays, for
users need not "use" any expressive aspects of the screen displays in
order to operate Lotus 1-2-3; because the way the screens look has little
bearing on how users control the program, the screen displays are not part
of Lotus 1-2-3's "method of operation". {n10}  The Lotus menu command
hierarchy is also different from the underlying computer code, because
while code is necessary for the program to work, its precise formulation
is not. In other words, to offer the same capabilities as Lotus 1-2-3,
Borland did not have to copy Lotus's underlying code (and indeed it did
not); to allow users to operate its programs in substantially the same
way, however, Borland had to copy the Lotus menu command hierarchy. Thus
the Lotus 1-2-3 code is not a uncopyrightable "method of operation". {n11}

The district court held that the Lotus menu command hierarchy, with
its specific choice and arrangement of command terms, constituted an
"expression" of the "idea" of operating a computer program with commands
arranged hierarchically into menus and submenus.  Borland II, 799 F. Supp.
at 216. Under the district court's reasoning, Lotus's decision to employ
hierarchically arranged command terms to operate its program could not
foreclose its competitors from also employing hierarchically arranged
command terms to operate their programs, but it did foreclose them from
employing the specific command terms and arrangement that Lotus had used.
In effect, the district court limited Lotus 1-2-3's "method of operation"
to an abstraction.

Accepting the district court's finding that the Lotus developers made some
expressive choices in choosing and arranging the Lotus command terms, we
nonetheless hold that that expression is not copyrightable because it is
part of Lotus 1-2-3's "method of operation"  We do not think that "methods
of operation" are limited to abstractions; rather, they are the means
by which a user operates something. If specific words are essential to
operating something, then they are part of a "method of operation" and,
as such, are unprotectable. This is so whether they must be highlighted,
typed in, or even spoken, as computer programs no doubt will soon be
controlled by spoken words.

The fact that Lotus developers could have designed the Lotus menu command
hierarchy differently is immaterial to the question of whether it is a
"method of operation".  In other words, our initial inquiry is not whether
the Lotus menu command hierarchy incorporates any expression. {n12}  Rather,
our initial inquiry is whether the Lotus menu command hierarchy is a
"method of operation". Concluding, as we do, that users operate Lotus
1-2-3 by using the Lotus menu command hierarchy, and that the entire
Lotus menu command hierarchy is essential to operating Lotus 1-2-3, we
do not inquire further whether that method of operation could have been
designed differently. The "expressive" choices of what to name the command
terms and how to arrange them do not magically change the uncopyrightable
menu command hierarchy into copyrightable subject matter.

Our holding that "methods of operation" are not limited to mere abstractions
is bolstered by Baker v. Selden. In Baker, the Supreme Court explained that

    the teachings of science and the rules and methods of useful art
    have their final end in application and use; and this application
    and use are what the public derive from the publication of a book
    which teaches them. . . . The description of the art in a book,
    though entitled to the benefit of copyright, lays no foundation
    for an exclusive claim to the art itself. The object of the one
    is explanation; the object of the other is use. The former may be
    secured by copyright. The latter can only be secured, if it can be
    secured at all, by letters-patent.

Baker v. Selden, 101 U.S. at 104-05. Lotus wrote its menu command hierarchy
so that people could learn it and use it. Accordingly, it falls squarely
within the prohibition on copyright protection established in Baker v.
Selden and codified by Congress in 102(b).

In many ways, the Lotus menu command hierarchy is like the buttons used to
control, say, a video cassette recorder ("VCR"). A VCR is a machine that
enables one to watch and record video tapes. Users operate VCRs by pressing
a series of buttons that are typically labelled "Record, Play, Reverse,
Fast Forward, Pause, Stop/Eject".  That the buttons are arranged and
labeled does not make them a "literary work", nor does it make them an
"expression" of the abstract "method of operating" a VCR via a set of
labeled buttons.  Instead, the buttons are themselves the "method of
operating" the VCR.

When a Lotus 1-2-3 user chooses a command, either by highlighting it on the
screen or by typing its first letter, he or she effectively pushes a button.
Highlighting the "Print" command on the screen, or typing the letter "P",
is analogous to pressing a VCR button labeled "Play".

Just as one could not operate a buttonless VCR, it would be impossible to
operate Lotus 1-2-3 without employing its menu command hierarchy. Thus the
Lotus command terms are not equivalent to the labels on the VCR's buttons,
but are instead equivalent to the buttons themselves. Unlike the labels
on a VCR's buttons, which merely make operating a VCR easier by indicating
the buttons' functions, the Lotus menu commands are essential to operating
Lotus 1-2-3. Without the menu commands, there would be no way to "push"
the Lotus buttons, as one could push unlabeled VCR buttons. While Lotus
could probably have designed a user interface for which the command terms
were mere labels, it did not do so here. Lotus 1-2-3 depends for its
operation on use of the precise command terms that make up the Lotus
menu command hierarchy.

One might argue that the buttons for operating a VCR are not analogous to
the commands for operating a computer program because VCRs are not
copyrightable, whereas computer programs are. VCRs may not be copyrighted
because they do not fit within any of the Section 102(a) categories of
copyrightable works; the closest they come is "sculptural work".  Sculptural
works, however, are subject to a "useful-article" exception whereby "the
design of a useful article . . . shall be considered a pictorial, graphic,
or sculptural work only if, and only to the extent that, such design
incorporates pictorial, graphic, or sculptural features that can be
identified separately from, and are capable of existing independently of,
the utilitarian aspects of the article." 17 U.S.C. 101. A "useful article"
is "an article having an intrinsic utilitarian function that is not merely
to portray the appearance of the article or to convey information." Id.
Whatever expression there may be in the arrangement of the parts of a VCR
is not capable of existing separately from the VCR itself, so an ordinary
VCR would not be copyrightable.

Computer programs, unlike VCRs, are copyrightable as "literary works".
17 U.S.C. 102(a). Accordingly, one might argue, the "buttons" used to
operate a computer program are not like the buttons used to operate a VCR,
for they are not subject to a useful-article exception. The response,
of course, is that the arrangement of buttons on a VCR would not be
copyrightable even without a useful-article exception, because the buttons
are an uncopyrightable "method of operation".  Similarly, the "buttons" of
a computer program are also an uncopyrightable "method of operation".

That the Lotus menu command hierarchy is a "method of operation" becomes
clearer when one considers program compatibility. Under Lotus's theory, if a
user uses several different programs, he or she must learn how to perform
the same operation in a different way for each program used. For example,
if the user wanted the computer to print material, then the user would
have to learn not just one method of operating the computer such that
it prints, but many different methods. We find this absurd. The fact that
there may be many different ways to operate a computer program, or even
many different ways to operate a computer program using a set of
hierarchically arranged command terms, does not make the actual method
of operation chosen copyrightable; it still functions as a method for
operating the computer and as such is uncopyrightable.

Consider also that users employ the Lotus menu command hierarchy in writing
macros. Under the district court's holding, if the user wrote a macro to
shorten the time needed to perform a certain operation in Lotus 1-2-3,
the user would be unable to use that macro to shorten the time needed
to perform that same operation in another program. Rather, the user would
have to rewrite his or her macro using that other program's menu command
hierarchy. This is despite the fact that the macro is clearly the user's
own work product. We think that forcing the user to cause the computer
to perform the same operation in a different way ignores Congress's
direction in Section 102(b) that "methods of operation" are not
copyrightable. That programs can offer users the ability to write macros
in many different ways does not change the fact that, once written, the
macro allows the user to perform an operation automatically. As the Lotus
menu command hierarchy serves as the basis for Lotus 1-2-3 macros, the
Lotus menu command hierarchy is a "method of operation".

In holding that expression that is part of a "method of operation" cannot
be copyrighted, we do not understand ourselves to go against the Supreme
Court's holding in Feist. In Feist, the Court explained:

     The primary objective of copyright is not to reward the labor of
     authors, but to promote the Progress of Science and useful Arts.
     To this end, copyright assures authors the right to their original
     expression, but encourages others to build freely upon the ideas
     and information conveyed by a work.

Feist, 499 U.S. at 349-50 (quotations and citations omitted). We do not
think that the Court's statement that "copyright assures authors the
right to their original expression" indicates that all expression is
necessarily copyrightable; while original expression is necessary for
copyright protection, we do not think that it is alone sufficient.
Courts must still inquire whether original expression falls within one
of the categories foreclosed from copyright protection by Section 102(b),
such as being a "method of operation".

We also note that in most contexts, there is no need to "build" upon other
people's expression, for the ideas conveyed by that expression can be
conveyed by someone else without copying the first author's expression.
{n13}  In the context of methods of operation, however, "building" requires
the use of the precise method of operation already employed; otherwise,
"building" would require dismantling, too. Original developers are not
the only people entitled to build on the methods of operation they
create; anyone can. Thus, Borland may build on the method of operation
that Lotus designed and may use the Lotus menu command hierarchy in
doing so.

Our holding that methods of operation are not limited to abstractions goes
against Autoskill, 994 F.2d at 1495 n.23, in which the Tenth Circuit
rejected the defendant's argument that the keying procedure used in a
computer program was an uncopyrightable "procedure" or "method of
operation" under Section 102(b). The program at issue, which was designed
to test and train students with reading deficiencies, id. at 1481,
required students to select responses to the program's queries "by pressing
the 1, 2, or 3 keys." Id. at 1495 n.23. The Tenth Circuit held that, "for
purposes of the preliminary injunction, . . . the record showed that
[this] keying procedure reflected at least a minimal degree of creativity",
as required by Feist for copyright protection. Id. As an initial matter,
we question whether a programmer's decision to have users select a
response by pressing the 1, 2, or 3 keys is original. More importantly,
however, we fail to see how "a student selecting a response by pressing
the 1, 2, or 3 keys", id., can be anything but an unprotectable method
of operation. {n14}


III.


Conclusion

Because we hold that the Lotus menu command hierarchy is uncopyrightable
subject matter, we further hold that Borland did not infringe Lotus's
copyright by copying it. Accordingly, we need not consider any of
Borland's affirmative defenses. The judgment of the district court is

REVERSED.


Concurrence follows. BOUDIN, Circuit Judge, concurring. The importance of
this case, and a slightly different emphasis in my view of the underlying
problem, prompt me to add a few words to the majority's tightly focused
discussion.


I.

Most of the law of copyright and the "tools" of analysis have developed in
the context of literary works such as novels, plays, and films. In this
milieu, the principal problem -- simply stated, if difficult to resolve --
is to stimulate creative expression without unduly limiting access by
others to the broader themes and concepts deployed by the author. The
middle of the spectrum presents close cases; but a "mistake" in providing
too much protection involves a small cost: subsequent authors treating
the same themes must take a few more steps away from the original expression.

The problem presented by computer programs is fundamentally different in
one respect. The computer program is a means for causing something to happen;
it has a mechanical utility, an instrumental role, in accomplishing the
world's work. Granting protection, in other words, can have some of the
consequences of patent protection in limiting other people's ability to
perform a task in the most efficient manner. Utility does not bar copyright
(dictionaries may be copyrighted), but it alters the calculus.

Of course, the argument for protection is undiminished, perhaps even
enhanced, by utility: if we want more of an intellectual product, a
temporary monopoly for the creator provides incentives for others to
create other, different items in this class. But the "cost" side of the
equation may be different where one places a very high value on public
access to a useful innovation that may be the most efficient means of
performing a given task. Thus, the argument for extending protection
may be the same; but the stakes on the other side are much higher.

It is no accident that patent protection has preconditions that copyright
protection does not -- notably, the requirements of novelty and
non-obviousness -- and that patents are granted for a shorter period than
copyrights. This problem of utility has sometimes manifested itself in
copyright cases, such as Baker v. Selden, 101 U.S. 99 (1879), and been
dealt with through various formulations that limit copyright or create
limited rights to copy. But the case law and doctrine addressed to utility
in copyright have been brief detours in the general march of copyright law.

Requests for the protection of computer menus present the concern with
fencing off access to the commons in an acute form. A new menu may be a
creative work, but over time its importance may come to reside more in
the investment that has been made by users in learning the menu and in
building their own mini-programs -- macros -- in reliance upon the menu.
Better typewriter keyboard layouts may exist, but the familiar QWERTY
keyboard dominates the market because that is what everyone has learned
to use. See P. David, CLIO and the Economics of QWERTY, 75 Am. Econ.
Rev. 332 (1985). The QWERTY keyboard is nothing other than a menu
of letters.

Thus, to assume that computer programs are just one more new means of
expression, like a filmed play, may be quite wrong. The "form" -- the
written source code or the menu structure depicted on the screen -- look
hauntingly like the familiar stuff of copyright; but the "substance"
probably has more to do with problems presented in patent law or, as
already noted, in those rare cases where copyright law has confronted
industrially useful expressions. Applying copyright law to computer
programs is like assembling a jigsaw puzzle whose pieces do not quite
fit.

All of this would make no difference if Congress had squarely confronted
the issue, and given explicit directions as to what should be done. The
Copyright Act of 1976 took a different course. While Congress said that
computer programs might be subject to copyright protection, it said this
in very general terms; and, especially in Section 102(b), Congress adopted
a string of exclusions that if taken literally might easily seem to
exclude most computer programs from protection. The only detailed
prescriptions for computers involve narrow issues (like back-up copies)
of no relevance here.

Of course, one could still read the statute as a congressional command
that the familiar doctrines of copyright law be taken and applied to
computer programs, in cookie cutter fashion, as if the programs were
novels or play scripts. Some of the cases involving computer programs
embody this approach. It seems to me mistaken on two different grounds:
the tradition of copyright law, and the likely intent of Congress.

The broad-brush conception of copyright protection, the time limits, and
the formalities have long been prescribed by statute. But the heart of
copyright doctrine -- what may be protected and with what limitations
and exceptions -- has been developed by the courts through experience
with individual cases. B. Kaplan, An Unhurried View of Copyright 40
(1967). Occasionally Congress addresses a problem in detail. For the
most part the interstitial development of copyright through the courts
is our tradition.

Nothing in the language or legislative history of the 1976 Act, or at least
nothing brought to our attention, suggests that Congress meant the courts
to abandon this case-by-case approach. Indeed, by setting up Section 102(b)
as a counterpoint theme, Congress has arguably recognized the tension and
left it for the courts to resolve through the development of case law.
And case law development is adaptive: it allows new problems to be solved
with help of earlier doctrine, but it does not preclude new doctrines
to meet new situations.


II.

In this case, the raw facts are mostly, if not entirely, undisputed.
Although the inferences to be drawn may be more debatable, it is very
hard to see that Borland has shown any interest in the Lotus menu except
as a fall-back option for those users already committed to it by prior
experience or in order to run their own macros using 1-2-3 commands. At
least for the amateur, accessing the Lotus menu in the Borland Quattro
or Quattro Pro program takes some effort.

Put differently, it is unlikely that users who value the Lotus menu for
its own sake -- independent of any investment they have made themselves
in learning Lotus' commands or creating macros dependent upon them --
would choose the Borland program in order to secure access to the Lotus
menu. Borland's success is due primarily to other features. Its rationale
for deploying the Lotus menu bears the ring of truth.

Now, any use of the Lotus menu by Borland is a commercial use and deprives
Lotus of a portion of its "reward", in the sense that an infringement claim
if allowed would increase Lotus' profits. But this is circular reasoning:
broadly speaking, every limitation on copyright or privileged use diminishes
the reward of the original creator. Yet not every writing is copyrightable
or every use an infringement. The provision of reward is one concern of
copyright law, but it is not the only one. If it were, copyrights would be
perpetual and there would be no exceptions.

The present case is an unattractive one for copyright protection of the
menu. The menu commands (e.g., "print," "quit") are largely for standard
procedures that Lotus did not invent and are common words that Lotus
cannot monopolize. What is left is the particular combination and
sub-grouping of commands in a pattern devised by Lotus. This arrangement
may have a more appealing logic and ease of use than some other
configurations; but there is a certain arbitrariness to many of the choices.

If Lotus is granted a monopoly on this pattern, users who have learned the
command structure of Lotus 1-2-3 or devised their own macros are locked
into Lotus, just as a typist who has learned the QWERTY keyboard would be
the captive of anyone who had a monopoly on the production of such a
keyboard. Apparently, for a period Lotus 1-2-3 has had such sway in the
market that it has represented the de facto standard for electronic
spreadsheet commands. So long as Lotus is the superior spreadsheet --
either in quality or in price -- there may be nothing wrong with this
advantage.

But if a better spreadsheet comes along, it is hard to see why customers
who have learned the Lotus menu and devised macros for it should remain
captives of Lotus because of an investment in learning made by the users
and not by Lotus.  Lotus has already reaped a substantial reward for
being first; assuming that the Borland program is now better, good reasons
exist for freeing it to attract old Lotus customers: to enable the old
customers to take advantage of a new advance, and to reward Borland in
turn for making a better product. If Borland has not made a better
product, then customers will remain with Lotus anyway.

Thus, for me the question is not whether Borland should prevail but on what
basis. Various avenues might be traveled, but the main choices are between
holding that the menu is not protectable by copyright and devising a new
doctrine that Borland's use is privileged. No solution is perfect and no
intermediate appellate court can make the final choice.

To call the menu a "method of operation" is, in the common use of those
words, a defensible position. After all, the purpose of the menu is not
to be admired as a work of literary or pictorial art. It is to transmit
directions from the user to the computer, i.e., to operate the computer.
The menu is also a "method" in the dictionary sense because it is a
"planned way of doing something", an "order or system", and (aptly here)
an "orderly or systematic arrangement, sequence or the like." Random House
Webster's College Dictionary 853 (1991).

A different approach would be to say that Borland's use is privileged
because, in the context already described, it is not seeking to
appropriate the advances made by Lotus' menu; rather, having provided
an arguably more attractive menu of its own, Borland is merely trying
to give former Lotus users an option to exploit their own prior investment
in learning or in macros. The difference is that such a privileged use
approach would not automatically protect Borland if it had simply copied
the Lotus menu (using different codes), contributed nothing of its own,
and resold Lotus under the Borland label.

The closest analogue in conventional copyright is the fair use doctrine.
E.g., Harper & Row, Publishers, Inc. v. Nation Enters., 471 U.S. 539,
(1985). Although invoked by Borland, it has largely been brushed aside
in this case because the Supreme Court has said that it is "presumptively"
unavailable where the use is a "commercial" one. See id. at 562. But see
Campbell v. Acuff-Rose Music, Inc., 127 L. Ed. 2d 500, 114 S. Ct. 1164, 1174
(1994). In my view, this is something less than a definitive answer;
"presumptively" does not mean "always" and, in any event, the doctrine
of fair use was created by the courts and can be adapted to new purposes.

But a privileged use doctrine would certainly involve problems of its own.
It might more closely tailor the limits on copyright protection to the
reasons for limiting that protection; but it would entail a host of
administrative problems that would cause cost and delay, and would also
reduce the ability of the industry to predict outcomes. Indeed, to the
extent that Lotus' menu is an important standard in the industry, it
might be argued that any use ought to be deemed privileged.

In sum, the majority's result persuades me and its formulation is as good,
if not better, than any other that occurs to me now as within the reach of
courts. Some solutions (e.g., a very short copyright period for menus)
are not options at all for courts but might be for Congress. In all events,
the choices are important ones of policy, not linguistics, and they should
be made with the underlying considerations in view.

FOOTNOTES:

{n1}  Judge Keeton presided over both the Paperback litigation and this
case.

{n2}  Lotus 1-2-3 utilizes a two-line menu; the top line lists the
commands from which the user may choose, and the bottom line displays
what Lotus calls its "long prompts".  The long prompts explain, as a sort
of "help text", what the highlighted menu command will do if entered. For
example, the long prompt for the "Worksheet" command displays the submenu
that the "Worksheet" command calls up; it reads "Global, Insert, Delete,
Column, Erase, Titles, Window, Status, Page".  The long prompt for the
"Copy" command explains what function the "Copy" command will perform:
"Copy a cell or range of cells".  The long prompt for the "Quit" command
reads, "End 1-2-3 session (Have you saved your work?)."

Prior to trial, the parties agreed to exclude the copying of the long prompts
from the case; Lotus agreed not to contend that Borland had copied the long
prompts, Borland agreed not to argue that it had not copied the long prompts,
and both sides agreed not to argue that the issue of whether Borland had
copied the long prompts was material to any other issue in the case. See
Borland III, 831 F. Supp. at 208.

{n3}  Because Borland's programs could no longer display the Lotus menu
command hierarchy to users, the Key Reader did not allow debugging or
modification of macros, nor did it permit the execution of most interactive
macros.

{n4}  See Borland IV, 831 F. Supp. at 226-27, for a more detailed
explanation of macros and the Key Reader.

{n5}  Computer programs receive copyright protection as "literary works".
See 17 U.S.C. 102(a)(1) (granting protection to "literary works") and
17 U.S.C.  (defining "literary works" as "works . . . expressed in
words, numbers, or other verbal or numerical symbols or indicia, regardless
of the nature of the material objects, such as books, periodicals,
phonorecords, film, tapes, disks, or cards, in which they are embodied"
(emphasis added)); see also 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' . . . 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.").

{n6}  Selden's system of double-entry bookkeeping is the now
almost-universal T-accounts system.

{n7}  We consider the Altai test because both parties and many of the amici
focus on it so heavily. Borland, in particular, is highly critical of the
district court for not employing the Altai test. Borland does not, however,
indicate how using that test would have been dispositive in Borland's favor.
Interestingly, Borland appears to contradict its own reasoning at times
by criticizing the applicability of the Altai test.

{n8}  We recognize that Altai never states that every work contains
a copyrightable "nugget" of protectable expression. Nonetheless, the
implication is that for literal copying, "it is not necessary to determine
the level of abstraction at which similarity ceases to consist of an
'expression of ideas', because literal similarity by definition is
always a similarity as to the expression of ideas."  3 Melville B. Nimmer
& David Nimmer, Nimmer on Copyright Section 13.03[A](2) (1993).

{n9}  As the Lotus long prompts are not before us on appeal, we take no
position on their copyrightability, although we do note that a strong
argument could be made that the brief explanations they provide "merge"
with the underlying idea of explaining such functions. See Morrissey v.
Procter & Gamble Co., 379 F.2d 675, 678-79 (1st Cir. 1967) (when the
possible ways to express an idea are limited, the expression "merges"
with the idea and is therefore uncopyrightable; when merger occurs,
identical copying is permitted).

{n10}  As they are not before us on appeal, we take no position on whether
the Lotus 1-2-3 screen displays constitute original expression capable
of being copyrighted.

{n11}  Because the Lotus 1-2-3 code is not before us on appeal, we take no
position on whether it is copyrightable. We note, however, that original
computer codes generally are protected by copyright. See, e.g., Altai,
982 F.2d at 702 ("It is now well settled that the literal elements of
computer programs, i.e., their source and object codes, are the subject
of copyright protection.") (citing cases).

{n12}  We think that the Altai test would contemplate this being the
initial inquiry.

{n13}  When there are a limited number of ways to express an idea,
however, the expression "merges" with the idea and becomes
uncopyrightable. Morrissey, 379 F.2d at 678-79.

{n14}  The Ninth Circuit has also indicated in dicta that "menus, and
keystrokes" may be copyrightable. Brown Bag Software v. Symantec Corp.,
960 F.2d 1465, 1477 (9th Cir.), cert. denied, BB Asset Management, Inc.
v. Symantec Corp., 121 L. Ed. 2d 141, 113 S. Ct. 198 (1992). In that
case, however, the plaintiff did not show that the defendant had copied
the plaintiff's menus or keystrokes, so the court was not directly
faced with whether the menus or keystrokes constituted an unprotectable
method of operation. Id.