Legal protection of computer programmes in the US, Europe and India: copyright, patents and the IT Act

Law of Intellectual Property and Information Technology · Unit IV · Topic 8 of 12 · 7 min read

How far copyright protects code and its structure in the US (Apple v Franklin, Whelan, Altai, Lotus, Google v Oracle) and the EU (Software Directive, SAS Institute, UsedSoft), the patent position under Alice and the EPC, and the Indian scheme: sections 2(ffc), 14(b) and 52(1)(aa)-(ad) of the Copyright Act, section 3(k) and Ferid Allani under the Patents Act, and the IT Act provisions as amended.

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On this page

1. Why software is hard to classify
2. United States
3. Europe
4. India: Copyright Act, 1957
5. India: Patents Act, 1970
6. India: Information Technology Act, 2000 and its amendments
How this is examined

Cases checked to exist. Read the judgment before quoting a holding.

Every case cited here has been checked to exist — the citation resolves and names the right parties. The propositions attributed to each case have not been verified line by line against the judgment. Case names link through to the full judgment: read it before quoting a holding in an examination answer, and never carry a proposition from notes into court on trust.

The examinable core. Every system protects code as a literary work. They differ on two points: how far copyright reaches beyond literal code into structure, interfaces and functionality, and whether software can be patented. The US moved from broad copyright (Whelan) to narrow copyright (Altai) and from broad patents (State Street) to narrow ones (Alice). Europe protects code but not functionality, and patents software only with a technical character. India follows Europe on both, through section 52(1)(ab)–(ac) and section 3(k) as read in Ferid Allani.

1. Why software is hard to classify

A programme is text (source code), a machine (object code makes hardware do things) and a product. Copyright suits it as text but protects only expression, while its value is mostly in function, which is the province of patents. Patent law suits function, but programmes are often abstract and incremental. In the 1970s WIPO proposed a sui generis regime (Model Provisions, 1978), but the US chose copyright and the world followed. TRIPS Article 10(1) and WCT Article 4 now require programmes to be protected as literary works, in source or object code.

2. United States

Copyright

CONTU and the 1980 amendment. The National Commission on New Technological Uses of Copyrighted Works (report 1978) recommended copyright; the Copyright Act was amended to define a computer program and to add section 117, allowing the owner of a copy to make copies or adaptations essential to its use and archival copies.
Apple Computer v. Franklin Computer (3rd Cir., 1983): object code and operating systems are protected, not only source code and application programs.
Whelan Associates v. Jaslow Dental Laboratory (3rd Cir., 1986): the idea is the programme’s purpose, and everything not necessary to that purpose, including its structure, sequence and organisation, is expression. This gave very broad protection.
Computer Associates v. Altai (2nd Cir., 1992): the abstraction-filtration-comparison test. Break the programme into levels of abstraction; filter out ideas, elements dictated by efficiency or external factors (hardware, compatibility, industry standards) and public domain material; compare only what remains. This became the dominant approach.
Lotus Development v. Borland (1st Cir., 1995, affirmed by an equally divided Supreme Court): the menu command hierarchy of a spreadsheet is a method of operation, excluded by section 102(b).
Sega v. Accolade (9th Cir., 1992): disassembly to discover interface requirements for compatible games is fair use.
Google LLC v. Oracle America (Supreme Court, 2021): the Court assumed without deciding that Java’s declaring code was copyrightable and held Google’s copying fair use, noting that the value of the declaring code lay in programmers’ investment in learning it.

Patents

Gottschalk v. Benson (1972) and Parker v. Flook (1978): algorithms as such are abstract ideas.
Diamond v. Diehr (1981): a rubber-curing process using a computer and a known equation is patentable as a whole.
State Street Bank v. Signature Financial (Fed. Cir., 1998): anything producing a “useful, concrete and tangible result”, including business methods, is patentable.
Bilski v. Kappos (2010) and Alice Corp. v. CLS Bank (2014): a claim directed to an abstract idea is not saved by implementation on a generic computer; it needs an “inventive concept” amounting to significantly more. Many software patents have since been invalidated.

3. Europe

Copyright: the Software Directive

Directive 91/250/EEC, codified as Directive 2009/24/EC, requires Member States to protect programmes as literary works.

Article 1: protection applies to the expression in any form; ideas and principles underlying any element, including interfaces, are not protected; the only originality criterion is that the programme is the author’s own intellectual creation.
Article 4: exclusive rights of reproduction, translation and adaptation, and distribution including rental; first sale in the EU exhausts distribution.
Article 5: a lawful acquirer may do acts necessary for use including error correction, make a back-up, and observe, study or test the programme.
Article 6: decompilation is permitted where indispensable to obtain information needed for interoperability of an independently created programme, within strict limits.
SAS Institute v. World Programming (CJEU, 2012): the functionality of a programme, its programming language and data file formats are not protected; a licensee may study it to reproduce its functions.
UsedSoft v. Oracle (CJEU, 2012): where software is downloaded under a perpetual licence for a fee, the distribution right is exhausted, so the licence can be resold with the copy.

Patents

Article 52(2)(c) of the European Patent Convention excludes programs for computers, but Article 52(3) limits the exclusion to programs “as such”. The EPO grants patents on computer-implemented inventions that have a technical character and solve a technical problem (G 3/08, 2010; COMVIK, T 641/00, on counting only technical features for inventive step). The UK Court of Appeal uses the four-step test in Aerotel v. Telco (2006). The proposed EU directive on computer-implemented inventions was rejected by the European Parliament in 2005.

4. India: Copyright Act, 1957

Definitions: section 2(o) (literary work includes computer programmes, tables and compilations including computer databases), section 2(ffb) (computer) and section 2(ffc) (computer programme).
Rights: section 14(b), the literary work rights plus sale and commercial rental of copies.
Permitted acts: section 52(1)(aa), copies or adaptations by the lawful possessor in order to use the programme for the purpose for which it was supplied, or as back-up; (ab), acts necessary to obtain information essential for operating inter-operability of an independently created programme, if not otherwise readily available; (ac), observation, study or testing to determine the ideas and principles underlying any element; (ad), copies or adaptations from a personally legally obtained copy for non-commercial personal use. These track Articles 5 and 6 of the EU Directive. Fair dealing under section 52(1)(a) does not apply to programmes.
Ownership: section 17(c), employer owns works made under a contract of service; assignment and licence under sections 18, 19 and 30.
Term: as for literary works generally, life of the author plus sixty years (section 22), with sixty years from publication for anonymous, government and similar works.
Technological measures: sections 65A and 65B.

5. India: Patents Act, 1970

Section 3(k) excludes “a mathematical or business method or a computer programme per se or algorithms”. The Patents (Amendment) Ordinance, 2004 tried to allow software with technical application to industry or in combination with hardware; Parliament did not enact that in 2005. In Ferid Allani v. Union of India (Delhi High Court, 2019), the court held that inventions based on computer programmes are patentable if they show a technical effect or technical contribution; only the programme per se is excluded. Later Delhi High Court decisions, such as Microsoft Technology Licensing v. Assistant Controller (2023), apply the same approach and ask what technical problem the claim solves. The Patent Office’s Guidelines for Examination of Computer Related Inventions (2017, since revised) direct examiners to look at the substance of the claim. Business methods remain excluded even when computer-implemented. See the separate note on section 3 for the detail.

6. India: Information Technology Act, 2000 and its amendments

The IT Act does not create an IP right, but it protects programmes as computer resources:

Section 43, compensation for unauthorised access, copying or extraction of data or programmes, and for damage; section 66, the corresponding offence (inserted in its present form in 2008).
Section 65, tampering with computer source code; section 66B, receiving stolen computer resources.
Section 72A, disclosure of information in breach of lawful contract.
Section 79, safe harbour for intermediaries; section 81, overriding effect, with a proviso (2008) that nothing in the Act restricts any right conferred under the Copyright Act or the Patents Act.
The IT (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021, as amended, require intermediaries to make reasonable efforts against hosting content that infringes IP rights.

Source code that is kept secret is also protected as confidential information by contract and equity; India has no trade secrets statute.

Issue	US	EU	India
Non-literal elements	Altai filtration	Functionality, language, formats excluded (SAS)	No settled test; idea-expression and s.52(1)(ac)
Reverse engineering	Fair use (Sega); DMCA exemption	Art. 6 decompilation	s.52(1)(ab)
Patents	Alice two-step	Technical character, “as such”	s.3(k) “per se”, technical effect

Debate: copyright or patent or neither? Copyright gives long protection (life plus sixty years) for something with a commercial life of a few years, but only against copying. Patents protect function, but for twenty years and with high costs and uncertain validity. Open-source advocates argue that both, and especially patents, obstruct interoperability. India’s middle path, protecting code by copyright, permitting interoperability, and patenting only technical contributions, is closest to the European model.

How this is examined

Likely long questions: “Examine the legal position of computer programmes in the US, Europe and India.” “Discuss the protection available to computer software under the Copyright Act, 1957, the Patents Act, 1970 and the IT Act, 2000.” “Are computer programmes patentable in India?”

Likely short notes: abstraction-filtration-comparison test; decompilation; section 3(k); Ferid Allani; Google v. Oracle; section 52(1)(ab).