Lotus Development Corp. v. Borland Intern., Inc., Civ. A. No. 90-11662-K.

• Decision Date: 19 August 1993
• Docket Number: Civ. A. No. 90-11662-K.
• Citation: 831 F. Supp. 202
• Parties: LOTUS DEVELOPMENT CORPORATION, Plaintiff, v. BORLAND INTERNATIONAL, INC., Defendant.
• Court: U.S. District Court — District of Massachusetts

831 F. Supp. 202

LOTUS DEVELOPMENT CORPORATION, Plaintiff, v. BORLAND INTERNATIONAL, INC., Defendant.

Civ. A. No. 90-11662-K.

United States District Court, D. Massachusetts.

June 30, 1993.

As Amended August 19, 1993.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

James C. Burling, Jeffrey B. Rudman, Hale & Dorr, Boston, MA, Henry B. Gutman, Kerry L. Konrad, O'Sullivan, Graev & Karabell, New York City, for plaintiff.

Peter E. Gelhaar, Donnelly, Conroy & Gelhaar, Boston, MA, Gary L. Reback, Peter N. Detkin, Andrew G. Konstantaras, Isabella E. Fu, Wilson, Sonsini, Goodrich & Rosati, Palo Alto, CA, for defendant.

OPINION

KEETON, District Judge.

On July 31, 1992, the court allowed, in part, a motion for summary judgment filed by plaintiff Lotus Development Corporation ("Lotus") and denied the cross motion for summary judgment by defendant Borland International, Incorporated ("Borland"). After extended procedural maneuvering, the parties agreed to try remaining liability issues without a jury. An explanation of the proceedings leading up to the trial is essential to precise identification of the issues raised by the parties in the nonjury trial of February 1-3 and March 31 — April 2, 1993.

I. Earlier Proceedings.

A. Partial Summary Judgment.

This Opinion assumes the reader's familiarity with the Memorandum and Order allowing, in part, Lotus's motion for summary judgment. That document was published as Lotus Dev. Corp. v. Borland Int'l, Inc., 799 F.Supp. 203 (D.Mass.1992) (July 31 Memorandum and Order). In addition, the terminology used in this Opinion follows the terminology set forth in detail in the earlier Memorandum and Order. Id. at 206-208. Background information appears in two earlier documents issued by this court. The first is a Memorandum and Order in this case, Lotus Dev. Corp. v. Borland Int'l, Inc., 788 F.Supp. 78 (D.Mass.1992). The second is an opinion in a related case involving claims of infringement of copyrights for the Lotus 1-2-3 program. Lotus Dev. Corp. v. Paperback Software Int'l, 740 F.Supp. 37 (D.Mass.1990).

The July 31 Memorandum and Order explained the standard to be applied in this case for determining copyrightability issues:

FIRST, in making the determination of "copyrightability," the decisionmaker must focus upon alternatives that counsel may suggest, or the court may conceive, along the scale from the most generalized conception to the most particularized, and choose some formulation, some conception of the "idea," "system," "process," "procedure," or "method" — for the purpose of distinguishing between the idea, system, process, procedure, or method and its expression.

. . . . .

SECOND, the decisionmaker must focus upon whether an alleged expression of the idea, system, process, procedure, or method is limited to elements essential to expression of that idea, system, process, procedure, or method (or is one of only a few ways of expressing the idea, system, process, procedure, or method) or instead includes identifiable elements of expression not essential to every expression of that idea, system, process, procedure, or method.

THIRD, having identified elements of expression not essential to every expression of the idea, system, process, procedure, or method, the decisionmaker must focus on whether those expressive elements, taken together, are a substantial part of the allegedly copyrightable "work."

Borland, 799 F.Supp. at 211 (quoting Borland, 788 F.Supp. at 90 (quoting Lotus Dev. Corp. v. Paperback Software Int'l, 740 F.Supp. 37, 60-61 (D.Mass.1990)) (all emphases omitted)).

Applying this test, I determined that the "idea," "system," "process," "procedure," or "method" of the Lotus 1-2-3 program is a menu-driven electronic spreadsheet whose

user interface involves a system of menus, each menu consisting of less than a dozen commands, arranged hierarchically, forming a tree in which the main menu is the root/trunk of the tree and submenus branch off from higher menus, each submenu being linked to a higher menu by operation of a command, so that all the specific spreadsheet operations available in Lotus 1-2-3 are accessible through the paths of the menu command hierarchy.

Id. at 216-17. (The meanings of menu command, menu structure and menu tree are explained at greater length below.) I concluded also that

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.

Id. at 223 (original emphasis).

Nevertheless, I concluded that determining the scope of relief in this case depends on resolution of disputed factual contentions because Lotus contended and Borland disputed "that the copying of separable expressive elements of the Lotus 1-2-3 user interface into the Quattro programs was greater than the minimum essential to constituting a substantial part of the Lotus 1-2-3 work," which I had determined on motion for summary judgment not to be genuinely in dispute. Id. In other words, there is no genuine dispute of fact that the Quattro and Quattro Pro programs infringe, but fact issues remain as to the scope of impermissible copying. Specific fact issues apparent on the record at that time concerned (1) whether Borland copied the long prompts of Lotus 1-2-3, (2) whether the long prompts contain expressive elements, and (3) the extent (if any) that functional constraints limit the number of possible ways that the Lotus menu command hierarchy could have been arranged at the time of its creation. See Order Regulating Jury Trial, September 30, 1992 (Docket No. 232) at 20.

In addition, I concluded that Lotus was entitled to summary judgment against Borland on the affirmative defense of waiver, but not on the affirmative defenses of laches and estoppel. See Borland, 799 F.Supp. at 222-23.

B. Further Proceedings Before Trial.

Up to the time of the court's ruling of July 31, 1992, the parties' contentions concerned issues raised in the allegations of the "original complaint" filed July 2, 1990, concerning infringement of Lotus 1-2-3 by Quattro and Quattro Pro's "emulation interface." Trial for the remaining liability issues in the original complaint was scheduled before a jury. In January 1993, this court permitted Lotus to file a supplemental complaint alleging copyright infringement by Borland in programs containing a "Key Reader" feature (which is described in some detail in the August 12, 1993 Opinion that addresses the issues of the "Key Reader" phase of the trial) — specifically in Quattro Pro versions 2.0, 3.0, 4.0, SE, 4.01 and Quattro Pro for Windows. See Docket 250, Exh. A.

After these developments and as the parties were preparing for trial of issues raised in the original complaint, the parties entered into a series of stipulations that altered the nature of the proceedings. See Stipulation and Order Regulating Trial (Docket No. 330); Stipulation and Order Regulating Key Reader Trial (Docket No. 349).

The first set of stipulations concerned trial of issues raised in the original complaint. These stipulations

govern the trial of all issues not previously finally decided by way of summary judgment concerning Borland's alleged liability herein, and all its defenses thereto, excluding the issues raised by Lotus' Supplemental Complaint concerning the "Key Reader" feature (the "Phase I Trial").

Docket No. 330, ¶ 1. With respect to issues raised in the original complaint, the parties waived jury trial for the liability issues that had previously been scheduled for the Phase I trial.

With respect to the long prompts, the parties stipulated that:

1. The order of display of the long prompts within the "1-2-3-compatible" modes of Quattro and Quattro Pro follows the order of display of the menu commands within those modes, and each such long prompt provides a short textual description of the command to which it relates.

2. Lotus shall not contend, in this action or any appeal therefrom, that Borland has copied the long prompts of Lotus 1-2-3 in Quattro or Quattro Pro.

3. Borland shall not contend, in this action or any appeal therefrom, that Borland has not copied the long prompts of Lotus 1-2-3 in Quattro or Quattro Pro.

4. Neither party shall contend, in this action or any appeal therefrom, that the issue of whether or not Borland copied the long prompts of Lotus 1-2-3 in either Quattro or Quattro Pro is material to any other issue that has been or will be resolved in this case.

Docket No. 330, Exh. A, ¶¶ 1-4.

The second set of stipulations "governs the trial of all liability issues (including any defenses thereto) raised by Lotus' Supplemental Complaint concerning the `Key Reader' feature (the `Phase II Trial')." Docket No. 349, ¶ 1. For trial of the liability issues raised by the supplemental complaint, the parties waived their rights to trial by jury. Id.

C. Summary of Issues Before the Court.

Phase I of the trial was held on February 1-3, 1993. At that time, the issues before the court were the scope of infringement by Borland and Borland's affirmative defenses of laches and estoppel (the affirmative defense of waiver having been resolved at summary judgment). After the close of Borland's evidence, however, Borland was allowed leave to amend its answer to assert an affirmative defense of fair use. See Memorandum and Order, March 30, 1993 (Docket No. 353). In response, Lotus moved for judgment on partial findings. See Fed. R.Civ.P. 52(c). After hearing in open court and for the reasons stated on the record, I allowed Lotus's motion for judgment on the issue of Borland's fair use defense to the original...