Computer Associates Int. Inc. V. Altai Inc. - Decision

Decision

The court reexamined the district court's process and found no significant fault with it. After taking out all functional elements and elements from the public domain, only a few lists and macros in OSCAR 3.5 were similar to ADAPTER, and their impact on the program was not large enough to declare copyright infringement. The court found that the similarity in services required by the operating system was due to the nature of the operating system, thus it was not protected by copyright. Similarly, the flow charts were found to be an element dictated by external factors following from the nature of the work, also unprotectable by copyright law. In light of this analysis, the court upheld the district courts finding that there was no copyright infringement by OSCAR 3.5.

CA's second argument for the appeal concerned trade secret misappropriation. The district court determined that the allegation of misappropriation was based on Altai's use of the infringing material, therefore the copyright infringement claim preempted the misappropriation claim according to 17 U.S.C. § 301. Upon revisiting the matter of trade secret misappropriation, the court found that with Arney's potential breach of confidentiality and Altai's potential liability for improper trade secret acquisition, these extra elements differentiate the trade secret misappropriation claim from the copyright infringement claim. The court vacated the district court's preemption ruling and remanded the case back to the district court.