Millennium Copyright Act
The latest effort to use the
(DMCA) as an obstacle to competition is
courtesy of StorageTek
. StorageTek, a company
that sells a number of storage devices and data management software, is
suing Custom Hardware Engineering
(CHE Consulting) for circumventing its GetKey
algorithm to gain access to StorageTek tape library maintenance codes.
So far, so good for
StorageTek, which has received an injunction (PDF of the decision
and the injunction
against CHE Consulting, essentially preventing the company from doing any
maintenance on StorageTek tape libraries that requires access to the
libraries' event messages. For the moment, an appeals court has put a stay
on the injunction, but that stay could be withdrawn at any time.
Reading through the decision issued by U.S. District Judge Rya Zobel, it
seems clear that Zobel has been firmly convinced of StorageTek's case. From
page 10 of the decision:
The balance of harm to plaintiff from the denial of the injunction
against that to defendant from the grant thereof tilts heavily to plantiff,
given its financial losses and damage to customer relations from
defendants' deliberate and calculated misconduct and theft.
It seems that StorageTek has managed to convince Zobel that CHE Consulting
has violated the DMCA by going around the GetKey algorithm and that CHE has
misappropriated StorageTek's trade secrets by gaining access to event
messages on StorageTek equipment.
CHE Consulting argued that Section 117 of the
Copyright Act was designed to allow third-parties to perform
maintenance or repair, but that did not convince Zobel.
Defendants copy the Code by turning on the machine; however, they do so not
just for repair, but also for the express purpose of circumventing
plaintiff's security measures, modifying the Maintenance Level, and
intercepting plaintiff's Event Messages.
What Zobel overlooks, of course, is that the only purpose to intercept the
event messages is to allow CHE Consulting to perform maintenance on the
equipment in question -- exactly what Section 117 of the Copyright Act was
intended to allow. There is no benefit to CHE aside from being able to
In order to get additional background and both sides of the story, we spoke
to StorageTek spokesperson Joe Fuentes and CHE Consulting's president,
David York. According to York, this case has actually been going on for
some time. He noted that CHE Consulting had purchased software to access
the error codes from 1997 through the first quarter of 2001, when
StorageTek sent a letter to CHE Consulting alleging that the company was
infringing on StorageTek's intellectual property rights. York said that CHE
Consulting provided documentation that they were buying the software and
then they didn't hear from StorageTek again until October of 2002 when the
suit was filed. He also noted that StorageTek stopped selling the
maintenance code to CHE Consulting in 2001.
When we spoke to Fuentes about the case, he was largely unable to answer
most of our questions, as he said that he was not technical enough to
respond to questions about the nature of the diagnostic tools and what
would be required for a third-party maintenance provider to work on a
StorageTek tape library without access to the maintenance code. Fuentes was
also unable to provide access to a StorageTek spokesperson or employee who
was knowledgeable enough about the case or the equipment to provide answers
to our questions.
Fuentes did provide a statement about the case:
We believe that CHE was using our intellectual property without
permission. Our job is to defend that intellectual property. I can't get
any more specific than that... I think what the court is saying kind of
confirms the value of our exclusive maintenance microcode. It's a
competitive business, and we use our developed codes to provide superior
services to enterprises.
We also asked Fuentes how StorageTek's customers would benefit from this
action. According to Fuentes, "we value our relationships with our
customers and want to make sure they get the best possible service. I have
to stop there." While talking about StorageTek's services group,
Fuentes also noted that the company serviced equipment produced by EMC, HP
and other providers. Fuentes could not answer whether or not StorageTek
used event messages generated by other manufacturers' equipment when
Fuentes also said that StorageTek's position was that third-parties could
provide service for the equipment if they "invest and develop their
own diagnostic tools to work on our equipment."
We asked York if it were possible for a third-party vendor to develop their
own diagnostic tools. According to York, CHE Consulting has done so:
We've been providing this [service for StorageTek equipment] for seven
years, all we're accessing is their data. We're not accessing anything that
could be deemed to be actual diagnostics, we have developed our own
exercise routines [for the equipment] on our own... we're talking about
error data, data from the physical device. The error data is what they're
claiming to own a copyright on.
We then asked York if it were possible for a third-party vendor to develop
tools, as Fuentes suggested, that would allow them to generate their own
codes. "Is it technically possible? We could debate that for a long
time." When asked if it were reasonable to suggest that a vendor
should develop that functionality on their own, he was more
firm. "No, it is not."
We are still in litigation and we are feeling this decision. CHE has worked
hard, its team members have worked hard. We believe we have a right to
compete, we believe we have a right to exist, and we don't believe we have
infringed upon anybody's rights here. We believe we're just some
hard-working people. Based upon the fact that we're using the software with
the customer's permission as it was designed is mind-boggling to me.
Zobel decided that "defendants' conduct has caused it [StorageTek]
irreparable harm." However, Zobel doesn't seem inclined to consider
the effects of the ruling on CHE Consulting. If StorageTek is successful in
preventing CHE Consulting from maintaining their equipment, it is likely to
be fairly catastrophic for CHE. York estimated that about half of
their business consists of maintaining equipment that is now essentially
off-limits to their company, unless they are successful in fighting the
case. York says that CHE Consulting has filed a request for an appeal and
stay of the order as of Monday, July 12.
We also asked York whether he was concerned about other vendors using the
DMCA to prevent third parties from servicing their equipment:
I'm certainly concerned, but I can't say what another company might do. We
service IBM equipment, even though we're partnered with them. For us to be
able to provide service, IBM sells diagnostic code, manuals,
parts... having said that, IBM, it appears, welcomes competition. If there
is competition, IBM makes the most of it by saying, "Okay, we can sell some
things, we win, independent organization wins, and most of all the customer
Meanwhile, StorageTek's customers lose, and so does CHE. There would be
little incentive for CHE to access event codes if some of StorageTek's
customers had not decided that they wanted to have their equipment serviced
by another organization.
StorageTek is not the first company to attempt to use the DMCA to lock
competitors out of their business, nor are they likely to be the last.
Until such a time as the DMCA is reformed, we will continue to see this
sort of case. As this case
illustrates, it's simply not enough to count on the courts to prevent abuse
of the DMCA, nor is it enough to depend on the goodwill of corporations to
protect the rights of their customers or act in their best interests.
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