Vault Corp. v. Quaid Software Ltd.
| Vault Corporation v. Quaid Software Limited | |
|---|---|
 |
|
| Court | United States Court of Appeals for the Fifth Circuit |
| Full case name | Vault Corporation v. Quaid Software Limited |
| Decided | June 20 1988 |
| Citation(s) | 847 F.2d 255 (5th Cir. 1988) |
| Case history | |
| Prior action(s) | 655 F.Supp. 750 (E.D.La.1987) |
| Holding | |
| Quaid's RAM copies are not infringing and Quaid's software is not a derivative work. Quaid is not liable for contributory infringement because its software can be used for making fair use archival copies of software. The Louisiana License Act's clause prohibiting decompilation or disassembly is unenforceable because it is preempted by federal copyright law. | |
| Court membership | |
| Judge(s) sitting | Thomas Morrow Reavley, Carolyn Dineen King, Jerry Edwin Smith |
| Case opinions | |
| Majority | Thomas Morrow Reavley |
| Laws applied | |
| 17 U.S.C. §101 et seq. (Copyright Act of 1976) | |
Vault Corporation v Quaid Software Ltd. 847 F.2d 255 (5th Cir. 1988) is a case heard by the United States Court of Appeals for the Fifth Circuit that tested the extent of software copyright. The court held that making RAM copies as an essential step in utilizing software was permissible under §117 of the Copyright Act even if they are used for a purpose that the copyright holder did not intend. It also applied the "substantial noninfringing uses" test from Sony Corp. of America v. Universal City Studios, Inc. to hold that Quaid's software, which defeated Vault's copy protection mechanism, did not make Quaid liable for contributory infringement. It held that Quaid's software was not a derivative work of Vault's software, despite having approximately 30 characters of source code in common. Finally, it held that the Louisiana Software License Enforcement Act clause permitting a copyright holder to prohibit software decompilation or disassembly was preempted by the Copyright Act, and was therefore unenforceable.
Vault Corporation created and held the copyright for a program called PROLOK, which provided copy protection for software on floppy disks. Software companies purchased PROLOK from Vault in order to protect their software from end users making unauthorized copies. PROLOK worked by having an indelible "fingerprint" on each PROLOK protected disk in addition to the PROLOK software and the software to be protected. The PROLOK protected program allowed the software to function only if the fingerprint was present on the disk.
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