On December, 2009, NEON Enterprise Software formally prosecuted IMB for anticompetitive behavior that IBM applied erroneous statements to force its customers to reject zPrime, a type of mainframe-related software produced by NEON. However, IMB countersued NEON of infringing upon IMB’s intellectual property and “inducing IMB’s customers to violate their agreements with IBM.” Finally, in 2011, the legal dispute is settled by NEON losing its operating rights for zPrime.
The well-known case brought a heated topic on intellectual property protection on intangible property, especially software copyright. In the case, the official judgment was that NEON Enterprise Software illegally implied the source code of IMB mainframe’s systems, which are zIIP and zAAP, to design zPrime. Therefore NEON broke the Intellectual Property Law and had to pay the punishment. By 1876, the United States had promulgated a series of Intellectual Property Law to legitimate various rights, including copyright, trademarks, patents and some design rights. With technological development, intellectual property protection confronts new challenges and a relatively important one of them is the software copyright because the software copyright infringement is difficult to be tracked, be evaluated and even be proved.
Historically, software, or called computer program, was not under protection for a very long time, since the computer program was not viewed as a “fixed and tangible” product. In other words, technically, software copyright is designated by the object code, which is an intangible good, produced from source code. Thus, to detect software copyright infringement needs comparisons of two programs’ source codes and object codes. The goal was very hard to achieve because, generally, designers have a strict security system to protect the source code from exposure; thereby others cannot obtain the code easily. For instance, there are two software implying exact the same source code; however, the outlook, manipulation and function are totally different, so, since the one cannot obtain other one’s source code without a legal authority, it is very hard to know that one commit software copyright infringement.
Also, the case of NEON Enterprise Software vs. IBM showed how important to protect the source code. When IBM just countersued NEON for hijacking IBM’s intellectual property, they had no evidences to prove that NEON illegally used reverse engineering to obtain their source code. In other word, IBM suspected that NEON designed zPrime which is directly based on IBM’s operating system because zPrime functioned as eliminating a huge amount of routine workloads running on the IBM mainframe’s central processor. Simultaneously, NEON improperly altered and dismissed zPrime’s development records to make infringement hard to be detected. Even though IBM successfully found evidences to sue NEON, the process took time and was grueling. However, if IBM had a more secure guard to prevent source code from reverse engineering the case would not exist. Therefore, the vital factor to protect software copyright is the source code protection; however, in the software field, the copyright only protects “expression”, but not “function”.
Protecting expression aims to protect idea’s expression. In other words, the copyright can protect the output of an idea, but not idea itself. Sometimes, the word “expression” can be considered as the source code. However, since there is no safety guard for the idea, the method of operating is not copyrightable, meaning that the function of software is not under protection. Moreover, the source codes of some small and medium software are relatively easy to be obtained by using reverse engineering, a technique that can get access to the ideas and functional elements. However, designers needs legitimate reason for using reverse engineering. For example, in the NEON Enterprise Software vs. IBM…