November 4, 2005 | By Fred von Lohmann

DMCA Used to Stymie Competition...Again

As we've noted before, the DMCA has increasingly been used to block competition, rather than to stop "piracy." First it was printer toner cartridges, then garage door openers, and today, in Storage Technology v. Custom Hardware Engineering, it's being used in an effort to tie hardware sales to post-sale service contracts. Today, EFF filed an amicus brief in this case, currently pending before the Federal Circuit.

Here are the facts: a vendor of high-density storage solutions wants to dominate the aftermarket for maintenance and service of its products. Nothing new here - vendors would love to lock you into using them for service. Thankfully, independent service providers have traditionally been able to offer some competition, to the benefit of consumers.

Years ago, computer vendors started trying to use copyright law to block competition - if independent service providers need to turn on the computers, they must be making unauthorized copies! Gotcha! Ultimately, Congress had to amend the Copyright Act to make it clear that independent service providers could turn on your computer to service it without fear of copyright retribution.

Now the bad guys at it again, this time with the DMCA. By putting a rudimetary "protection measure" on their maintenance code, StorageTek hoped to lure independent service vendors into a DMCA trap - aha, even if the Copyright Act lets you turn on the computer, now we've got you for "circumvention"!

Fortunately, the Federal Circuit Court of Appeals wasn't buying it. A few months ago, it ruled that the independent service provider, Custom Hardware, was not violating the DMCA because merely activating the maintenance code had no nexus with any potential copyright infringement. After all, it's not as though Custom Hardware was going to make a hundred copies and carry them off to sell at the local swap meet! They were just using code that StorageTek's customers already had on their systems.

Now StorageTek has petitioned the full Federal Circuit, asking that the earlier ruling be overturned and that the Federal Circuit's decision last year in Chamberlain v. Skylink (the DMCA v. universal garage door opener case) be thrown out. Joining them, not surprisingly, was the entire copyright cabal (RIAA, MPAA, AAP, NMPA, SIIA, ESA).

Well, we think that the Federal Circuit was right to rule that the DMCA ought not block competition in garage door openers. And we think they were right not to let the DMCA block competition for computer maintenance. Read our brief to learn more.


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