Disputes relating to software are often complex, with multiple parties and issues involved. However, they can also illuminate important questions. Software Solutions Ltd & Ors v 365 Health and Wellbeing Ltd & Anor, a judgment by HHJ Melissa Clarke in February 2021, is a good example.
While numerous companies were involved in the case at various stages, the question essentially was whether version 5 of a mental health application called Beating the Blues (BTB v 5) infringed copyright and database rights in a computer application development framework called the IDEA System (which the judge compared to Microsoft PowerPoint in terms of its functionality).
It took more than five years between the claim being issued and judgment being given, and there were multiple points of contention between the parties. By the time of the trial, it was common ground (among other things) that copyright subsisted in both the IDEA System and the XML Schema; and that BTB v5 reproduced the IDEA System source code materials and XML Schema. That left four issues to be resolved.
Issue 1: What is the XML Schema? The judge accepted that the XML Schema (i) was painstakingly developed with great effort, time and expense; (ii) is special and unique; (iii) is part of, and lies at the heart of the IDEA System, being utilised in a number of components including the IDEA Editor, IDEA Engine, IDEA Player, and Runtime player; and (iv) is utilised in the creation and running of any application created using the IDEA System, not just BTB.
She concluded: “The XML Schema which was used to create, validate and run the BTB application and which is implicit in the BTB XML files is substantially the same XML Schema which is utilised to create, validate and run any interactive multimedia self-help application created on the IDEA System” and that it is therefore part of the IDEA System.
Issue 2: Who owns the rights in the XML Schema? There was a dispute over the interpretation of an agreement and licence from 2002, and the judge preferred the claimants’ submissions, which were essentially that the XML Schema was included within the definition of “Retained IPR” in the documents.
Issue 3: Is the XML Schema protected by database rights? The judge noted that for a database right to subsist the claimants were required to show that "there has been qualitatively or quantitatively a substantial investment in either the obtaining, verification or presentation of the contents to prevent extraction and/or re-utilisation of the whole or a substantial part, evaluated qualitatively and/or quantitively, of the contents of that database".
But she concluded that the XML Schema was not itself a collection of independent data arranged in a systematic or methodical way, and she was therefore not satisfied that it was a database. She reasoned: “Much as the individual words in a literary work cannot be separated without losing their literary value …, it seems to me (in the absence of any submissions otherwise) that the individual categories of what elements, attributes and data are validly contained in the XML Schema cannot be separated without losing the informative value of the rules as a whole.”
Issue 4: Additional damages under section 97(2) CDPA 1988. HHJ Clarke found that the defendants’ decision to exploit BTB v5 without carrying out sufficient investigations of infringement was reckless.
She also found that the defendants had benefited from the infringement (which had continued for four years) and that significant distress had been caused to the claimants and their representatives – not least by the duration of the litigation.
To find out more about the issues raised in this case including trade mark disputes and filing contact Rosie Burbidge, Intellectual Property Partner at Gunnercooke LLP in London - rosie.burbidge@gunnercooke.com
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