Abstraction, Filtration, Comparison, Oh My! - 11th Circuit Provides In-Depth Analysis of the Abstraction/Filtration Test and Burden Shifting in Complicated Software and Source Code Infringement Case
Compulife Software Inc. v. Newman, No. 18-12004, 2020 WL 2549505 (11th Cir. May 20, 2020)
There’s nothing easy about this case. The facts are complicated, and the governing law is tangled. At its essence, it’s a case about high-tech corporate espionage. The very short story: Compulife Software, Inc., which has developed and markets a computerized mechanism for calculating, organizing, and comparing life-insurance quotes, alleges that one of its competitors lied and hacked its way into Compulife’s system and stole its proprietary data. The question for us is whether the defendants crossed any legal lines—and, in particular, whether they infringed Compulife’s copyright or misappropriated its trade secrets, engaged in false advertising, or violated an anti-hacking statute.
With the parties’ consent, a magistrate judge was tasked with tackling these thorny issues in a bench trial. He determined that Compulife had failed to prove any legal violation. We conclude, however, that in finding that Compulife hadn’t demonstrated either copyright infringement or trade-secret misappropriation, the magistrate judge made several discrete legal errors and, more generally, failed to adequately explain his conclusions. Accordingly, we vacate the judgment in part and remand with instructions to make new findings of fact and conclusions of law.
Compulife and the defendants are direct competitors in a niche industry: generating life-insurance quotes. Compulife maintains a database of insurance-premium information—called the “Transformative Database”—to which it sells access. The Transformative Database is valuable because it contains up-to-date information on many life insurers’ premium-rate tables and thus allows for simultaneous comparison of rates from dozens of providers. Most of Compulife’s customers are insurance agents who buy access to the database so that they can more easily provide reliable cost estimates to prospective policy purchasers. Although the Transformative Database is based on publicly available information—namely, individual insurers’ rate tables—it can’t be replicated without a specialized method and formula known only within Compulife.
Compulife sells two different kinds of access to the Transformative Database—a “PC version” and an “internet-engine version”—each run by its own piece of software and each accompanied by its own type of license. Both pieces of software contain an encrypted copy of the database. The PC-version software—called the “PC quoter”—is sold along with a PC license that allows licensees to install copies of the quoter on their personal computers and other devices for (depending on the number of devices) a cost of either $180 or $300 per year. The PC quoter uses its local copy of the Transformative Database to generate insurance-rate estimates corresponding to demographic information entered by the end user.
A PC licensee can purchase an add-on called the “web quoter” for an extra $96 per year. The web-quoter feature allows the PC licensee to put a quoter on its own website, which it can then use as a marketing tool to attract customers. Once a licensee’s website is equipped with the web quoter, prospective life-insurance purchasers can enter demographic information into fields on the licensee’s site and receive quotes directly from the licensee. Unlike the PC quoter—which contains its own local copy of the Transformative Database—the web quoter generates quotes by communicating with an internet-quote engine hosted on Compulife’s server. The HTML source code of the web quoter is protected by a registered copyright.
A second kind of license—the “internet-engine” license—permits a licensee to host Compulife’s internet-quote engine, which includes the Transformative Database, on its own server and to integrate it with additional features of its own creation. (Naturally, it’s more expensive—it costs $1200 per year.) An internet-engine licensee can then sell access to “its” product—which is an amalgamation of Compulife’s internet-quote engine with any accoutrements that the licensee has seen fit to add. Importantly, though, internet-engine licensees can sell access only to Compulife’s PC licensees. This arrangement allows an internet-engine licensee to include Compulife’s internet-quote engine—again, with the Transformative Database—as a part of its own product, while simultaneously ensuring that it doesn’t compete with Compulife for potential insurance-agent customers. Compulife also permits an internet-engine licensee to provide its web-quoter HTML code to the licensee’s customers so that the customers’ websites can retrieve quotes from the licensee’s server. This is the same copyrighted HTML code that Compulife provides to PC licensees with the web quoter add-on.
In addition to the PC-version and internet-engine products that it licenses to agents and that contain the Transformative Database, Compulife also provides consumers with direct access to life-insurance quotes through its Term4Sale internet site, www.term4sale.com. Term4Sale communicates with essentially the same internet-quote engine that PC licensees’ web quoters access and that internet-engine licensees are permitted to maintain on their own servers. Anyone can use the Terms4Sale site to receive free life-insurance quotes directly from a copy of the Transformative Database that Compulife hosts on its own server. The Term4Sale site refers prospective life-insurance purchasers to insurance agents with whom Compulife partners, who in turn pay Compulife for the referrals.
Now, to the defendants, who are also in the business of generating life-insurance quotes—primarily through a website, www.naaip.org. “NAAIP” stands for National Association of Accredited Insurance Professionals, but as the court below found, “NAAIP is not a real entity, charity, not-for-profit, or trade association, and is not incorporated anywhere.” Compulife Software, Inc. v. Rutstein, No. 9:16-cv-80808, 2018 U.S. Dist. LEXIS 41111 at *15 (Mar. 12, 2018). Through naaip.org, the defendants offer a service similar to—and, the evidence shows, at least partially copied from—Compulife’s web quoter, which they call a “Life Insurance Quote Engine.” Any insurance agent can sign up for a free website located on the domain naaip.org—for example, “http://naaip.org/tmatteson77.”
The defendants host thousands of these sites on a server in Israel and equip each one with the Life Insurance Quote Engine. Prospective life-insurance purchasers can then obtain quotes on any of these NAAIP-hosted websites by entering demographic information, just as they could on the website of any Compulife PC licensee with a web quoter add-on. Each NAAIP site includes a link that allows consumers to purchase insurance through One Resource Group, Inc., a brokerage firm with which the defendants have partnered. If a visitor to an NAAIP site uses the link to buy insurance, the defendants receive a part of One Resource’s brokerage fees in exchange for the referral.
The defendants also operate the BeyondQuotes website, www.beyondquotes.com, which includes a Life Insurance Quote Engine like the ones on participating NAAIP websites. BeyondQuotes operates similarly to Compulife’s Term4Sale site, generating revenue by selling referrals to affiliated insurance agents.
First, the misplaced burden. To properly frame this error, a little background is in order. The magistrate judge misallocated the burden of proof applicable to the filtration step of the substantial-similarity analysis. Filtration, again, refers to the process of separating the protectable elements of a copyrighted work from elements that, for one reason or another, aren’t protected.
The notion that unprotected material should be disregarded when comparing two works is at least a century old. See Int’l News Serv. v. Associated Press, 248 U.S. 215, 234, 39 S.Ct. 68, 63 L.Ed. 211 (1918). Conceiving of filtration as a distinct step in the infringement analysis, however, came into the law relatively recently, in the Second Circuit’s seminal decision in Computer Assocs. Int’l, Inc. v. Altai, Inc., 982 F.2d 693 (2d Cir. 1992). We have adopted a version of Altai’s test, see Bateman, 79 F.3d at 1543–46, which has three steps: (1) abstraction, (2) filtration, and (3) comparison. Altai, 982 F.2d at 706. In order to “ascertain[ ] substantial similarity under this approach, a court ... first break[s] down the allegedly infringed program into its constituent structural parts”—that’s abstraction. Bateman, 79 F.3d at 1544 (quoting Altai, 982 F.2d at 706). Next, the court “sift[s] out all non-protectable material”—filtration. Id. The “last step [is] to compare” any remaining “kernels[ ] of creative expression” with the “allegedly infringing program” to determine if there is in fact a substantial similarity—comparison. Id. Although we have observed that Altai, by its terms, dealt only with a narrow category of copying, see MiTek, 89 F.3d at 1555 n.16, “a parallel type of analysis”—including filtration, or its equivalent—applies more generally, see Bateman, 79 F.3d at 1545. Here, we focus on the filtration step because that’s where we conclude the magistrate judge went astray.
Filtration can be tricky because copied material may be unprotectable for a wide variety of reasons. First, for instance, copyright protection extends only to a work’s expressive elements, not to any underlying “idea, procedure, process, system, method of operation, concept, principle, or discovery” expressed therein. 17 U.S.C. § 102; see also Baker v. Selden, 101 U.S. 99, 102, 25 L.Ed. 841 (1879) (“[T]here is a clear distinction between the book, as such, and the art which it is intended to illustrate.”). Courts call this the “idea-expression” dichotomy, with the term “idea” standing in “as a metonym for all eight categories” of unprotectable material. 1 Nimmer on Copyright § 2A.06; see, e.g., Oravec v. Sunny Isles Luxury Ventures, L.C., 527 F.3d 1218, 1224 (11th Cir. 2008). Second, and separately, some expression may be so intrinsic to the communication of an idea—or procedure, process, etc.—that it is considered to have “merged” into the idea. According to the merger doctrine, where there are sufficiently “few ways of expressing an idea, not even the expression is protected by copyright.” BUC, 489 F.3d at 1143. In one seminal example, the First Circuit determined that a written rule governing a sweepstakes—requiring, for instance, that “[e]ntrants should print name, address and social security number on a boxtop, or a plain paper”—wasn’t protectable because the ideas it expressed were “so straightforward and simple” that “at best only a limited number” of possible modes of expression could exist to convey them. Morrissey v. Procter & Gamble Co., 379 F.2d 675, 678–79 (1st Cir. 1967).
Third—and this is easier to understand—material taken from the public domain is unprotected, even if incorporated into a copyrighted work. See Stewart v. Abend, 495 U.S. 207, 234, 110 S.Ct. 1750, 109 L.Ed.2d 184 (1990) (holding that an author “may receive protection only for his original additions,” not “elements ... already in the public domain”). Fourth, material may be unprotected if it constitutes scènes à faire—that is “[i]ncidents, characters, or settings that are indispensable or standard in the treatment of a given topic.” Corwin v. Walt Disney Co., 475 F.3d 1239, 1251 (11th Cir. 2007) (alteration in original) (quoting Herzog v. Castle Rock Entm't, 193 F.3d 1241, 1248 (11th Cir. 1999)); see also Beal v. Paramount Pictures Corp., 20 F.3d 454, 459 (11th Cir. 1994) (describing scènes à faire as “stock scenes that naturally flow from a common theme”). For example, we have noted that there is “no protection for common elements in police fiction, such as ‘drunks, prostitutes, vermin and derelict cars’ and ‘foot chases and the morale problems of policemen, not to mention the familiar figure of the Irish cop.’ ” Corwin, 475 F.3d at 1251 (quoting Walker v. Time Life Films, Inc., 784 F.2d 44, 50 (2d Cir. 1986)). Finally, certain ways of arranging information—say, alphabetically—are entirely unoriginal, and therefore unprotectable. See Feist, 499 U.S. at 363, 111 S.Ct. 1282 (explaining that presenting data in alphabetical order is “so commonplace that it has come to be expected as a matter of course”).
How might these categories of unprotectability apply in a case like this one? Well, for one, by analogy to merger and scènes à faire, elements of computer source-code expression “dictated by external factors” aren’t entitled to copyright protection. Bateman, 79 F.3d at 1547. Frequently, “compatibility requirements and industry demands ... [can make it] ‘virtually impossible to write a program to perform particular functions in a specific computing environment without employing standard techniques.’ ” Id. at 1546–47 (quoting Altai, 982 F.2d at 709). The author of a copyrighted code can’t obtain protection for such standard modes of expression, lest he effectively monopolize an underlying “idea.”
In any event, many species of unprotectability may be at issue in a single case, and the filtration process must eliminate all of them so that only protectable material is considered when deciding—at the comparison step—whether two works are substantially similar. Bateman, 79 F.3d at 1545 (“[F]iltration should eliminate from comparison the unprotectable elements of ideas, processes, facts, public domain information, merger material, scènes à faire material, and other unprotectable elements.” (alteration in original)).
With that background, we come to the magistrate judge’s first error. In his opinion, the magistrate judge implicitly placed on Compulife the burden of proving that the elements of its HTML code that the defendants copied were protectable. In particular, he faulted Compulife for having “made no attempt to identify the protectable elements of the 2010 HTML Source Code.” Compulife Software, 2018 U.S. Dist. LEXIS 41111, at *38. Although we haven’t previously done so, we now clarify that after an infringement plaintiff has demonstrated that he holds a valid copyright and that the defendant engaged in factual copying, the defendant bears the burden of proving—as part of the filtration analysis—that the elements he copied from a copyrighted work are unprotectable. That is so for two main reasons. First, assigning this burden to the defendant is consonant with our existing precedent, and it enjoys the support of the foremost copyright treatise. See Bateman, 79 F.3d at 1542 (“[T]he plaintiff must also respond to any proof advanced by the defendant that the portion of the copyrighted work actually taken does not satisfy the constitutional requirement of originality as set forth in Article I, § 8, cl. 8.” (emphasis added)); 4 Nimmer on Copyright § 13.03[F][3] (“Although [a] plaintiff’s failure to present proof about [merger and scènes à faire] could defeat a plaintiff’s application for a preliminary injunction, it would seem that defendant must go forward at trial with appropriate evidence as to those doctrines.”).
Second, placing the burden to prove protectability on the infringement plaintiff would unfairly require him to prove a negative. Protectability can’t practicably be demonstrated affirmatively but, rather, consists of the absence of the various species of unprotectability. If the plaintiff had the burden of proving protectability, he would have to preemptively present evidence negating all possible theories of unprotectability just to survive a motion for summary judgment. Cf. Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1116 (11th Cir. 1993) (noting that a summary-judgment movant “simply may ... point[ ] out ... that there is an absence of evidence to support the non-moving party’s case” where the non-moving party bears the burden of proof). And, of course, some types of unprotectability can be negated only by presenting practically infinite evidence. A plaintiff, for instance, can’t be expected to present the entirety of the public domain as it existed when he authored his copyrighted material in order to show that no elements of his work were taken from it. Nor could a plaintiff reasonably introduce the entire corpus of relevant, industry-standard techniques just to prove that none of the material copied from his work constituted scènes à faire. Placing the burden of proving protectability on the plaintiff would seemingly require just these kinds of impossibilities.
Placing the burden on the defendant, by contrast, merely requires him to identify the species of unprotectability that he is alleging and to present supporting evidence where appropriate. If, for instance, the defendant believes that some part of the copyrighted work is in the public domain, he must narrow the inquiry by indicating where in the public domain that portion of the work can be found. Similarly, if he thinks that what he copied amounts to usual industry practice, he must indicate the standards that dictate that technique. The plaintiff then faces the manageable task of “respond[ing],” Bateman, 79 F.3d at 1542, to the appropriately narrowed issue. Placing the burden on the defendant, therefore, isn’t just consistent with our own precedent and leading scholarly commentary, but also fairer and more efficient.
In light of these considerations, copyright-infringement analysis should proceed as follows: Once the plaintiff has proven that he has a valid copyright and that the defendant engaged in factual copying, the defendant may seek to prove that some or all of the copied material is unprotectable. If the defendant carries this burden as to any portion of the copied material, that material should be filtered out of the analysis before comparing the two works. After filtration is complete, the burden shifts back to the plaintiff to prove substantial similarity between any remaining (i.e., unfiltered) protectable material and the allegedly infringing work. If the defendant demonstrates—at the filtration stage—that it copied only unprotectable material, such that no substantial similarities remain after filtration, the defendant is entitled to summary judgment. See Home Design Servs., Inc. v. Turner Heritage Homes Inc., 825 F.3d 1314, 1322 (11th Cir. 2016). But because the defendant bears the burden to demonstrate unprotectability, the mere failure of the plaintiff to present evidence of protectability—assuming that a valid copyright and factual copying have already been established—isn’t a sufficient reason to give judgment to the defendant. Rather, where the defendant’s evidence is insufficient to prove that a particular element is unprotectable, the court should simply assume that the element is protectable and include that element in the final substantial-similarity comparison between the works.
The magistrate judge committed errors of law and made insufficient findings, which tainted his conclusion that Compulife’s copyright was not infringed. He also erred in his analysis of trade-secret misappropriation, both by failing to consider the application of several species of misappropriation and by committing legal error. Accordingly, we vacate the judgment as to copyright infringement and trade-secret misappropriation and remand for new findings of fact and conclusions of law. We find no reversible error in the magistrate judge’s rejection of Compulife’s other claims and affirm the remainder of the judgment.
AFFIRMED in part, VACATED in part, and REMANDED for new findings of fact and conclusions of law on the claims of copyright infringement and trade-secret misappropriation.
Compulife Software Inc. v. Newman, No. 18-12004, 2020 WL 2549505 (11th Cir. May 20, 2020)
Topic: Abstraction/Filtration Anaylsis & Burden Shifting
Takeaway: After an infringement plaintiff has demonstrated that he holds a valid copyright and that the defendant engaged in factual copying, the defendant bears the burden of proving—as part of the filtration analysis—that the elements he copied from a copyrighted work are unprotectable.
Overall, this is a very in depth and complicated case that involves multiple aspects of IP law. As such, this post is limited to the issue of copyright infringement and protectability under the abstraction/filtration test. Check back next week for part 2 regarding the trade-secret issues!
naaip.org/logo
compulife.com
Background & Parties
There’s nothing easy about this case. The facts are complicated, and the governing law is tangled. At its essence, it’s a case about high-tech corporate espionage. The very short story: Compulife Software, Inc., which has developed and markets a computerized mechanism for calculating, organizing, and comparing life-insurance quotes, alleges that one of its competitors lied and hacked its way into Compulife’s system and stole its proprietary data. The question for us is whether the defendants crossed any legal lines—and, in particular, whether they infringed Compulife’s copyright or misappropriated its trade secrets, engaged in false advertising, or violated an anti-hacking statute.
With the parties’ consent, a magistrate judge was tasked with tackling these thorny issues in a bench trial. He determined that Compulife had failed to prove any legal violation. We conclude, however, that in finding that Compulife hadn’t demonstrated either copyright infringement or trade-secret misappropriation, the magistrate judge made several discrete legal errors and, more generally, failed to adequately explain his conclusions. Accordingly, we vacate the judgment in part and remand with instructions to make new findings of fact and conclusions of law.
Compulife and the defendants are direct competitors in a niche industry: generating life-insurance quotes. Compulife maintains a database of insurance-premium information—called the “Transformative Database”—to which it sells access. The Transformative Database is valuable because it contains up-to-date information on many life insurers’ premium-rate tables and thus allows for simultaneous comparison of rates from dozens of providers. Most of Compulife’s customers are insurance agents who buy access to the database so that they can more easily provide reliable cost estimates to prospective policy purchasers. Although the Transformative Database is based on publicly available information—namely, individual insurers’ rate tables—it can’t be replicated without a specialized method and formula known only within Compulife.
Compulife sells two different kinds of access to the Transformative Database—a “PC version” and an “internet-engine version”—each run by its own piece of software and each accompanied by its own type of license. Both pieces of software contain an encrypted copy of the database. The PC-version software—called the “PC quoter”—is sold along with a PC license that allows licensees to install copies of the quoter on their personal computers and other devices for (depending on the number of devices) a cost of either $180 or $300 per year. The PC quoter uses its local copy of the Transformative Database to generate insurance-rate estimates corresponding to demographic information entered by the end user.
A PC licensee can purchase an add-on called the “web quoter” for an extra $96 per year. The web-quoter feature allows the PC licensee to put a quoter on its own website, which it can then use as a marketing tool to attract customers. Once a licensee’s website is equipped with the web quoter, prospective life-insurance purchasers can enter demographic information into fields on the licensee’s site and receive quotes directly from the licensee. Unlike the PC quoter—which contains its own local copy of the Transformative Database—the web quoter generates quotes by communicating with an internet-quote engine hosted on Compulife’s server. The HTML source code of the web quoter is protected by a registered copyright.
A second kind of license—the “internet-engine” license—permits a licensee to host Compulife’s internet-quote engine, which includes the Transformative Database, on its own server and to integrate it with additional features of its own creation. (Naturally, it’s more expensive—it costs $1200 per year.) An internet-engine licensee can then sell access to “its” product—which is an amalgamation of Compulife’s internet-quote engine with any accoutrements that the licensee has seen fit to add. Importantly, though, internet-engine licensees can sell access only to Compulife’s PC licensees. This arrangement allows an internet-engine licensee to include Compulife’s internet-quote engine—again, with the Transformative Database—as a part of its own product, while simultaneously ensuring that it doesn’t compete with Compulife for potential insurance-agent customers. Compulife also permits an internet-engine licensee to provide its web-quoter HTML code to the licensee’s customers so that the customers’ websites can retrieve quotes from the licensee’s server. This is the same copyrighted HTML code that Compulife provides to PC licensees with the web quoter add-on.
In addition to the PC-version and internet-engine products that it licenses to agents and that contain the Transformative Database, Compulife also provides consumers with direct access to life-insurance quotes through its Term4Sale internet site, www.term4sale.com. Term4Sale communicates with essentially the same internet-quote engine that PC licensees’ web quoters access and that internet-engine licensees are permitted to maintain on their own servers. Anyone can use the Terms4Sale site to receive free life-insurance quotes directly from a copy of the Transformative Database that Compulife hosts on its own server. The Term4Sale site refers prospective life-insurance purchasers to insurance agents with whom Compulife partners, who in turn pay Compulife for the referrals.
Now, to the defendants, who are also in the business of generating life-insurance quotes—primarily through a website, www.naaip.org. “NAAIP” stands for National Association of Accredited Insurance Professionals, but as the court below found, “NAAIP is not a real entity, charity, not-for-profit, or trade association, and is not incorporated anywhere.” Compulife Software, Inc. v. Rutstein, No. 9:16-cv-80808, 2018 U.S. Dist. LEXIS 41111 at *15 (Mar. 12, 2018). Through naaip.org, the defendants offer a service similar to—and, the evidence shows, at least partially copied from—Compulife’s web quoter, which they call a “Life Insurance Quote Engine.” Any insurance agent can sign up for a free website located on the domain naaip.org—for example, “http://naaip.org/tmatteson77.”
The defendants host thousands of these sites on a server in Israel and equip each one with the Life Insurance Quote Engine. Prospective life-insurance purchasers can then obtain quotes on any of these NAAIP-hosted websites by entering demographic information, just as they could on the website of any Compulife PC licensee with a web quoter add-on. Each NAAIP site includes a link that allows consumers to purchase insurance through One Resource Group, Inc., a brokerage firm with which the defendants have partnered. If a visitor to an NAAIP site uses the link to buy insurance, the defendants receive a part of One Resource’s brokerage fees in exchange for the referral.
The defendants also operate the BeyondQuotes website, www.beyondquotes.com, which includes a Life Insurance Quote Engine like the ones on participating NAAIP websites. BeyondQuotes operates similarly to Compulife’s Term4Sale site, generating revenue by selling referrals to affiliated insurance agents.
Abstraction/Filtration Test & Burden Shifting
First, the misplaced burden. To properly frame this error, a little background is in order. The magistrate judge misallocated the burden of proof applicable to the filtration step of the substantial-similarity analysis. Filtration, again, refers to the process of separating the protectable elements of a copyrighted work from elements that, for one reason or another, aren’t protected.
The notion that unprotected material should be disregarded when comparing two works is at least a century old. See Int’l News Serv. v. Associated Press, 248 U.S. 215, 234, 39 S.Ct. 68, 63 L.Ed. 211 (1918). Conceiving of filtration as a distinct step in the infringement analysis, however, came into the law relatively recently, in the Second Circuit’s seminal decision in Computer Assocs. Int’l, Inc. v. Altai, Inc., 982 F.2d 693 (2d Cir. 1992). We have adopted a version of Altai’s test, see Bateman, 79 F.3d at 1543–46, which has three steps: (1) abstraction, (2) filtration, and (3) comparison. Altai, 982 F.2d at 706. In order to “ascertain[ ] substantial similarity under this approach, a court ... first break[s] down the allegedly infringed program into its constituent structural parts”—that’s abstraction. Bateman, 79 F.3d at 1544 (quoting Altai, 982 F.2d at 706). Next, the court “sift[s] out all non-protectable material”—filtration. Id. The “last step [is] to compare” any remaining “kernels[ ] of creative expression” with the “allegedly infringing program” to determine if there is in fact a substantial similarity—comparison. Id. Although we have observed that Altai, by its terms, dealt only with a narrow category of copying, see MiTek, 89 F.3d at 1555 n.16, “a parallel type of analysis”—including filtration, or its equivalent—applies more generally, see Bateman, 79 F.3d at 1545. Here, we focus on the filtration step because that’s where we conclude the magistrate judge went astray.
Filtration can be tricky because copied material may be unprotectable for a wide variety of reasons. First, for instance, copyright protection extends only to a work’s expressive elements, not to any underlying “idea, procedure, process, system, method of operation, concept, principle, or discovery” expressed therein. 17 U.S.C. § 102; see also Baker v. Selden, 101 U.S. 99, 102, 25 L.Ed. 841 (1879) (“[T]here is a clear distinction between the book, as such, and the art which it is intended to illustrate.”). Courts call this the “idea-expression” dichotomy, with the term “idea” standing in “as a metonym for all eight categories” of unprotectable material. 1 Nimmer on Copyright § 2A.06; see, e.g., Oravec v. Sunny Isles Luxury Ventures, L.C., 527 F.3d 1218, 1224 (11th Cir. 2008). Second, and separately, some expression may be so intrinsic to the communication of an idea—or procedure, process, etc.—that it is considered to have “merged” into the idea. According to the merger doctrine, where there are sufficiently “few ways of expressing an idea, not even the expression is protected by copyright.” BUC, 489 F.3d at 1143. In one seminal example, the First Circuit determined that a written rule governing a sweepstakes—requiring, for instance, that “[e]ntrants should print name, address and social security number on a boxtop, or a plain paper”—wasn’t protectable because the ideas it expressed were “so straightforward and simple” that “at best only a limited number” of possible modes of expression could exist to convey them. Morrissey v. Procter & Gamble Co., 379 F.2d 675, 678–79 (1st Cir. 1967).
Third—and this is easier to understand—material taken from the public domain is unprotected, even if incorporated into a copyrighted work. See Stewart v. Abend, 495 U.S. 207, 234, 110 S.Ct. 1750, 109 L.Ed.2d 184 (1990) (holding that an author “may receive protection only for his original additions,” not “elements ... already in the public domain”). Fourth, material may be unprotected if it constitutes scènes à faire—that is “[i]ncidents, characters, or settings that are indispensable or standard in the treatment of a given topic.” Corwin v. Walt Disney Co., 475 F.3d 1239, 1251 (11th Cir. 2007) (alteration in original) (quoting Herzog v. Castle Rock Entm't, 193 F.3d 1241, 1248 (11th Cir. 1999)); see also Beal v. Paramount Pictures Corp., 20 F.3d 454, 459 (11th Cir. 1994) (describing scènes à faire as “stock scenes that naturally flow from a common theme”). For example, we have noted that there is “no protection for common elements in police fiction, such as ‘drunks, prostitutes, vermin and derelict cars’ and ‘foot chases and the morale problems of policemen, not to mention the familiar figure of the Irish cop.’ ” Corwin, 475 F.3d at 1251 (quoting Walker v. Time Life Films, Inc., 784 F.2d 44, 50 (2d Cir. 1986)). Finally, certain ways of arranging information—say, alphabetically—are entirely unoriginal, and therefore unprotectable. See Feist, 499 U.S. at 363, 111 S.Ct. 1282 (explaining that presenting data in alphabetical order is “so commonplace that it has come to be expected as a matter of course”).
How might these categories of unprotectability apply in a case like this one? Well, for one, by analogy to merger and scènes à faire, elements of computer source-code expression “dictated by external factors” aren’t entitled to copyright protection. Bateman, 79 F.3d at 1547. Frequently, “compatibility requirements and industry demands ... [can make it] ‘virtually impossible to write a program to perform particular functions in a specific computing environment without employing standard techniques.’ ” Id. at 1546–47 (quoting Altai, 982 F.2d at 709). The author of a copyrighted code can’t obtain protection for such standard modes of expression, lest he effectively monopolize an underlying “idea.”
In any event, many species of unprotectability may be at issue in a single case, and the filtration process must eliminate all of them so that only protectable material is considered when deciding—at the comparison step—whether two works are substantially similar. Bateman, 79 F.3d at 1545 (“[F]iltration should eliminate from comparison the unprotectable elements of ideas, processes, facts, public domain information, merger material, scènes à faire material, and other unprotectable elements.” (alteration in original)).
With that background, we come to the magistrate judge’s first error. In his opinion, the magistrate judge implicitly placed on Compulife the burden of proving that the elements of its HTML code that the defendants copied were protectable. In particular, he faulted Compulife for having “made no attempt to identify the protectable elements of the 2010 HTML Source Code.” Compulife Software, 2018 U.S. Dist. LEXIS 41111, at *38. Although we haven’t previously done so, we now clarify that after an infringement plaintiff has demonstrated that he holds a valid copyright and that the defendant engaged in factual copying, the defendant bears the burden of proving—as part of the filtration analysis—that the elements he copied from a copyrighted work are unprotectable. That is so for two main reasons. First, assigning this burden to the defendant is consonant with our existing precedent, and it enjoys the support of the foremost copyright treatise. See Bateman, 79 F.3d at 1542 (“[T]he plaintiff must also respond to any proof advanced by the defendant that the portion of the copyrighted work actually taken does not satisfy the constitutional requirement of originality as set forth in Article I, § 8, cl. 8.” (emphasis added)); 4 Nimmer on Copyright § 13.03[F][3] (“Although [a] plaintiff’s failure to present proof about [merger and scènes à faire] could defeat a plaintiff’s application for a preliminary injunction, it would seem that defendant must go forward at trial with appropriate evidence as to those doctrines.”).
Second, placing the burden to prove protectability on the infringement plaintiff would unfairly require him to prove a negative. Protectability can’t practicably be demonstrated affirmatively but, rather, consists of the absence of the various species of unprotectability. If the plaintiff had the burden of proving protectability, he would have to preemptively present evidence negating all possible theories of unprotectability just to survive a motion for summary judgment. Cf. Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1116 (11th Cir. 1993) (noting that a summary-judgment movant “simply may ... point[ ] out ... that there is an absence of evidence to support the non-moving party’s case” where the non-moving party bears the burden of proof). And, of course, some types of unprotectability can be negated only by presenting practically infinite evidence. A plaintiff, for instance, can’t be expected to present the entirety of the public domain as it existed when he authored his copyrighted material in order to show that no elements of his work were taken from it. Nor could a plaintiff reasonably introduce the entire corpus of relevant, industry-standard techniques just to prove that none of the material copied from his work constituted scènes à faire. Placing the burden of proving protectability on the plaintiff would seemingly require just these kinds of impossibilities.
Placing the burden on the defendant, by contrast, merely requires him to identify the species of unprotectability that he is alleging and to present supporting evidence where appropriate. If, for instance, the defendant believes that some part of the copyrighted work is in the public domain, he must narrow the inquiry by indicating where in the public domain that portion of the work can be found. Similarly, if he thinks that what he copied amounts to usual industry practice, he must indicate the standards that dictate that technique. The plaintiff then faces the manageable task of “respond[ing],” Bateman, 79 F.3d at 1542, to the appropriately narrowed issue. Placing the burden on the defendant, therefore, isn’t just consistent with our own precedent and leading scholarly commentary, but also fairer and more efficient.
In light of these considerations, copyright-infringement analysis should proceed as follows: Once the plaintiff has proven that he has a valid copyright and that the defendant engaged in factual copying, the defendant may seek to prove that some or all of the copied material is unprotectable. If the defendant carries this burden as to any portion of the copied material, that material should be filtered out of the analysis before comparing the two works. After filtration is complete, the burden shifts back to the plaintiff to prove substantial similarity between any remaining (i.e., unfiltered) protectable material and the allegedly infringing work. If the defendant demonstrates—at the filtration stage—that it copied only unprotectable material, such that no substantial similarities remain after filtration, the defendant is entitled to summary judgment. See Home Design Servs., Inc. v. Turner Heritage Homes Inc., 825 F.3d 1314, 1322 (11th Cir. 2016). But because the defendant bears the burden to demonstrate unprotectability, the mere failure of the plaintiff to present evidence of protectability—assuming that a valid copyright and factual copying have already been established—isn’t a sufficient reason to give judgment to the defendant. Rather, where the defendant’s evidence is insufficient to prove that a particular element is unprotectable, the court should simply assume that the element is protectable and include that element in the final substantial-similarity comparison between the works.
Holding
The magistrate judge committed errors of law and made insufficient findings, which tainted his conclusion that Compulife’s copyright was not infringed. He also erred in his analysis of trade-secret misappropriation, both by failing to consider the application of several species of misappropriation and by committing legal error. Accordingly, we vacate the judgment as to copyright infringement and trade-secret misappropriation and remand for new findings of fact and conclusions of law. We find no reversible error in the magistrate judge’s rejection of Compulife’s other claims and affirm the remainder of the judgment.
AFFIRMED in part, VACATED in part, and REMANDED for new findings of fact and conclusions of law on the claims of copyright infringement and trade-secret misappropriation.
Compulife Software Inc. v. Newman, No. 18-12004, 2020 WL 2549505 (11th Cir. May 20, 2020)
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