IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
INTELLECTUAL PROPERTY ENTERPRISE COURT
Royal Courts of Justice, Rolls Building
Fetter Lane, London, EC4A 1NL
Before :
HIS HONOUR JUDGE HACON
Between :
EDOZO LIMITED | Claimant |
- and - | |
VALOS (UK) LIMITED | Defendant |
Douglas Campbell KC (instructed by Fieldfisher LLP) for the Claimant
Anna Edwards-Stuart KC (instructed by Bristows LLP) for the Defendant
Hearing date: 15 January 2026
Approved Judgment
This judgment was handed down remotely at 10.40am on 21 January 2026 by circulation to the parties or their representatives by e-mail and by release to the National Archives.
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HIS HONOUR JUDGE HACON
Judge Hacon :
Introduction
This is an application by the claimant, (‘Edozo’), to strike out parts of the Defence and Counterclaim of the defendant, (‘Valos’).
Douglas Campbell KC appeared for Edozo, Anna Edwards-Stuart KC for Valos.
Background
Edozo and Valos are competitors in a market which provides valuations and other information about real property. Both offer their customers access to software based systems which supply the information.
Valos’s system is known as the ‘Valos Platform’. Customers of the Valos Platform are given access to alternative graphical user interfaces, or GUIs, on the Valos website. The alternative GUIs allow customers to obtain different types of information. In each case the Valos Platform produces what are called ‘Valos Reports’ in Microsoft Word. The GUIs are called ‘Valos Report Graphics’.
Valos Reports are built from templates to which more individualised information is added to make up the final report. The templates were referred to as the ‘Valos Template Reports’.
For some time before the dispute arose, Edozo offered a service providing customers with information in various forms: transaction data for commercial properties in the UK, the identity of current occupiers of commercial properties and boundary maps for such properties. In late 2023 Edozo added to its portfolio what it calls ‘Edozo Reports’. These, like Valos Reports, provide valuations and associated information about properties in the UK. Edozo Reports are generated by a system referred to as the ‘Edozo Platform’. The system is accessed by customers through GUIs provided on Edozo’s website. Edozo’s GUIs are referred to in the pleadings as ‘Edozo Report Graphics’. The overall product marketed to customers, enabling the accurate and speedy production of Edozo Reports, has been called the ‘Edozo Reports Product’.
Valos took the view that the Edozo Reports had unfair similarities with its Valos Reports. Valos complained in correspondence that Edozo was infringing Valos’s copyrights, initially relying on copyright in the Valos Template Reports and the Valos Report Graphics. Later it was further alleged that Edozo was infringing copyright in the underlying software of the Valos Platform.
A mediation was held in April 2025, with no resolution. On 17 April 2025 Valos’s solicitors sent a letter stating that Valos was preparing to issue a claim of copyright infringement. On 29 April 2025 Edozo took the initiative by issuing the claim form in these proceedings which seeks declarations of non-infringement. Valos has counterclaimed alleging infringement.
The nature of Valos’s counterclaim
In broad terms Valos’s claims of infringement can be divided into two types. The first relates to alleged infringement of copyright in the Valos Template Reports and in the GUIs, the Valos Report Graphics. In relation to these it is alleged that Edozo copied – it has had access to both – and in consequence infringed the respective copyrights. The Valos Template Reports are said to be original literary works, while the Valos Report Graphics are original graphic works containing text which consists of original literary works.
The second type of infringement claim is in respect of copyright in Valos’s software. The software is subdivided into three parts: the ‘Original Valos Platform Computer Program’, updates to that software which are referred to as ‘Subsequent Valos Platform Computer Programs’ and coded prompts which enable the principal software to retrieve specific data relevant to the report being created, these being called ‘Valos Coded Prompts’. The source code of all this software is said to consist of original literary works in which copyright subsists.
The pleaded argument on infringement of copyright in the Valos Coded Prompts is slightly different to that on infringement of the Original and Subsequent Valos Platform Computer Programs but no distinction relevant to this application was advanced by either side. To keep discussion simpler than it would otherwise be, I will not distinguish between different parts of Valos’s software and will treat all of it, and all copyright in it, collectively.
No point arises in the present application regarding the first type of alleged copyright infringement, i.e. that relying on copyright in the Valos Template Reports and the Valos Report Graphics. Only the second type is in issue, that relating to copyright in the Valos Computer Programs. A key feature of this second type is that Valos does not allege that Edozo has ever had access to the source code. The allegation is that Edozo has infringed the copyright in that source code indirectly.
It is sufficient for me to quote Valos’s pleaded case (with original italics) in respect of copyright in the Valos Platform Computer Programs, sometimes just called Valos Computer Programs in the pleadings, as opposed to Valos’s case on copyright in the Valos Coded Prompts which raises no further issues:
‘48. Since a date unknown to the Defendant, but prior to November 2023, the Claimant developed the Edozo Platform so as to offer the Edozo Reports Product. The Edozo Reports Product is offered to the Claimant’s customers from its website at <https://www.edozo.com> (the Edozo Website). As particularised below the Edozo Reports Product reproduces the sequence of dynamic logic and modularity whereby the user can generate the automated Edozo Reports.
The Defendant relies on the aspects of the dynamic logic and modularity of the Edozo Reports Product set out in Confidential Annex 6 to this Defence and Counterclaim.
The dynamic logic and modularity of the Edozo Reports Product reproduces a substantial part of the dynamic logic and modularity of the Valos Platform (as set out at Confidential Annex 1). The Defendant relies on the side-by-side comparison of the dynamic logic and modularity of the Edozo Reports Product and the Valos Platform as set out in Confidential Annex 7.
Further, the Edozo Reports Product was copied from the Valos Platform (including the Valos Reports and the Valos GUIs) and thereby indirectly copied from the Original Valos Computer Program and the Subsequent Valos Computer Programs (and each or any of them). The Defendant relies on the following facts and matters in support of its allegation of copying:
an ex-employee of the Claimant has admitted to the Defendant that the Claimant had access to the Valos Platform when developing its Edozo Reports product;
as of October 2023 or thereabouts the Valos Platform was the only platform for automating the creation of data-enriched valuation reports, in the premises it is inevitable that the Claimant sought to benchmark its new product by reference to the Valos Platform including the Valos Reports and the Valos GUIs;
the similarities between the Edozo Reports Product and the Valos Platform as set out in Confidential Annex 7;
the similarities between the Edozo Coded Prompts and the Valos Coded Prompts and the copying of the Edozo Coded Prompts from the Valos Coded Prompts as set out further below;
the similarities between the Edozo Reports and the Valos Reports and the copying of the Edozo Reports from the Valos Reports and the Valos Template Reports as set out further below;
the following comment in a demonstration video to prospective clients from an Edozo sales representative: “Obviously you’ve trialled Valos, and there is part of the platform that is very similar to what they do, but it’s worth noting our pricing covers more than just Reports…”;
at a meeting between the founders of the Claimant and the Defendant on 24 September 2024, the Claimant’s CEO, Mr Marcus Ginn, stated “we copied you” to Mr Kountourides and Mr Davis of the Defendant and made comments to the effect that the Claimant would not have executed the Edozo Reports Product the way it had if it had not seen the Valos Platform;
the similarities between the Edozo GUIs and the Valos GUIs and the copying of the Edozo GUIs from the Valos GUIs as set out further below;
in May 2023 Valos was informed by a client that Edozo intended to compete with the Valos Platform and to launch a product within 12 months. By October 2023 or thereabouts Edozo were promoting a product. The rapid timeframe to develop the Edozo Development GUI and launch the Edozo Reports Product is indicative of a springboard achieved by copying; and
a client of the Defendant saw a video in November 2023 of what the Defendant infers was the Edozo Reports Product and described it as “almost identical,” to the Valos Platform including the dataset structure, map integration, and user-driven flows.
In the premises, the Edozo Platform reproduces a substantial part and is therefore an Infringing Copy (within the meaning of section 27 of the CDPA) of the literary copyright subsisting in the Original Valos Computer Program and/or the Subsequent Valos Computer Programs (and each or any of them) (the Infringing Edozo Platform).
Further, the Infringing Edozo GUIs (as defined below) are generated from the Edozo Reports Product and/or the Edozo Platform and in the premises, the Infringing Edozo GUIs (and each of them) reproduce a substantial part of the literary copyright subsisting in the Original Valos Computer Program and/or the Subsequent Valos Computer Programs (and each or any of them).’
The foregoing requires some unpacking. Paragraphs 48-50 plead that the dynamic logic and modularity of the Edozo Reports Product reproduces a substantial part the dynamic logic and modularity of the Valos Platform. Using this sort of language inevitably raises the suspicion, and in fact the accusation by Edozo, that on closer inspection the words will turn out to be meaningless: ‘a fine concatenation of buzzwords’ which are ‘difficult to pin down as a matter of meaning’, see Navitaire Inc v easyJet Airline Co Ltd [2004] EWHC 1725 (Ch), at [131]. I asked counsel for Valos to clarify ‘dynamic logic and modularity’.
She referred me to confidential annexes 7 and 17 to the Defence and Counterclaim. Annex 7 has two columns. The left hand column sets out in some detail a set of steps which the user of the Valos system will take and what is sequentially shown by the system to the user as he or she navigates the procedure generated by the Valos software in order to obtain the information sought. I will call these the ‘Valos Steps’. In the right hand column are set out the equivalent steps experienced by a user of the Edozo system, which I will call the ‘Edozo Steps’. Annex 17 also has two columns. These reproduce what appears on the user’s screen, in the left hand column when going through the Valos Steps and the right column for the Edozo Steps. Confidential Annex 6, referred to in paragraph 49 of the Defence and Counterclaim, just sets out the Edozo Steps. Confidential Annex 1, referred to in paragraph 50, sets out the Valos Steps.
In other words, the ‘dynamic logic and modularity’ of the Valos Platform means the Valos Steps. Valos’s case is that the Edozo Steps reproduce the Valos Steps in substantial part.
Paragraph 51 of the Defence and Counterclaim takes this further by pleading that the Edozo Reports Product was thereby indirectly copied from the Valos Computer Programs, providing particulars of why that is. ‘Thereby’ apparently refers back to what is alleged in paragraphs 48-50. In other words, because the Valos Steps – which were available to Edozo along with any other user – were copied to create the Edozo Steps, the software used by Edozo to generate the Edozo Steps indirectly copied the Valos software. When I asked, Valos’s counsel confirmed that this did not imply an allegation that the Edozo source code is, or for the purpose of Valos’s case needs to be, in any way similar to the Valos source code.
Paragraph 52 says it follows from paragraph 51 that the Edozo Platform reproduces a substantial part and is an infringing copy of the copyright in the Valos software. I take this to mean that the Edozo software reproduces the Valos software in substantial part and therefore infringes the copyright in the Valos software. Paragraph 53 states that the same goes for the Edozo GUIs.
The point in dispute in summary
Edozo argued that Valos’s case of indirect copying of the Valos software by reason of similarities between the Valos and Edozo Steps is bad in law. Consequently the Particulars of Claim disclose no reasonable grounds for bringing that part of Valos’s case and it stands to be struck out pursuant to CPR 3.4(2)(a).
It was agreed between the parties that at this hearing I should assume that there are similarities between the Edozo and Valos Steps such that Edozo must have copied the Valos Steps. It was also agreed that since the point in issue was one of law, I should decide the point now, as opposed to requiring Edozo to establish that Valos has no real prospect of succeeding on the point of law at trial.
Indirect copying
There is no doubt that a party may infringe a copyright work by the indirect copying of that work, see s.16(3)(b) of the Copyright, Designs and Patents Act 1988.
In such cases the alleged infringer is at the end of a chain of copying. The defendant is said to have copied a work, commonly created by another party, which was itself copied from the copyright work in suit. The chain may of course be longer than this 2-link example but it must be unbroken.
For indirect copying to occur, each link in the chain need not be the same type of copyright work or indeed anything that may itself be protected by copyright. For instance, an artistic work may be indirectly copied where the defendant’s work is created through the intermediary of a verbal description of the claimant’s work provided the description is sufficiently precise to allow the defendant to reproduce the claimant’s work in substantial part, see Plix Products Ltd v Frank M. Winstone (Merchants)[1986] FSR 63, at 91.
Valos referred to Abraham Moon & Sons Ltd v Thornber [2012] EWPCC 37. The claimant was a woollen mill which made a fabric called Skye Sage. The alleged infringers’ fabric was called Spring Meadow. One of the copyright works relied on was the claimant’s ticket stamp. This was a two-page document setting out in words and numbers the instructions for setting up a loom to produce the Skye Sage fabric in various alternative colourways. It was held that the Skye Sage ticket stamp was a literary work in which copyright subsisted and that the copyright had been infringed by the creation of the Spring Meadow ticket. Although the Spring Meadow ticket looked nothing like the Skye Sage ticket, the key information regarding the appearance of Skye Sage fabric – the intermediary in the chain – had been taken and reproduced in a different ‘language’ in the form of the Spring Meadow ticket. The literary copyright in the Sky Sage ticket was infringed.
Likewise in the present case, it was argued, the Valos software was copied in the creation of the Edozo software via the intermediary of the Valos Steps. To ensure that the Edozo software presented very similar steps to the user in operation, Edozo had indirectly copied the Valos software.
I accept that indirect copying is possible in the sense that the Edozo source code was written in a manner such that that it would perform steps which replicate the Valos Steps. But assuming that is correct, it does not address the point of law raised by Edozo, as I will explain. I would add that the argument on the point of law did not include debate as to whether Abraham Moon is consistent with the cases on the idea/expression distinction of copyright law discussed below, including substantiality, so I can leave that to one side.
The protection afforded by copyright in a computer program
Edozo submitted that copyright in a computer program protects the skill, judgment and labour in devising the source code used in the program. It does not protect the functionality of the program, that is to say the tasks which the program allows the computer to perform. This includes the form and sequence of presentations by the computer in the course of its interactions with the user, such as the Valos Steps.
The point of law raised by Edozo raises the boundary between the expression of ideas protected by copyright law and the ideas themselves which the law does not protect. Though often cited as a basic tenet of copyright law, the location of the boundary between an idea as such and its expression is generally hard to pin down. In Kogan v Martin [2019] EWCA Civ 1645 the Court of Appeal made the point:
‘[34] … Copyright, of course, does not subsist in mere ideas, but in their expression. That proposition is a well-established one in English law, and is now also to be found in a number of international treaties and EU Directives: see art.9(2) of the Agreement on Trade-Related Aspects of Intellectual Property Rights (“TRIPs”) and art.2 of the WIPO Copyright Treaty. The ideas/expression dichotomy has, however, been described as “notoriously slippery”: see Simone, Copyright and Collective Authorship (Cambridge University Press, 2019), at p.41. A mere idea, stripped of any context, is of course not the subject of copyright. Jacob J put it in this way in IBCOS Computers Ltd v Barclays Mercantile Highland Finance Ltd [1994] F.S.R. 275 at p.291:
“The true position is that where an ‘idea’ is sufficiently general, then even if an original work embodies it, the mere taking of that idea will not infringe. But if the ‘idea’ is detailed, then there may be infringement. It is a question of degree. The same applies whether the work is functional or not, and whether visual or literary. In the latter field the taking of a plot (i.e. the ‘idea’) of a novel or play can certainly infringe – if that plot is a substantial part of the copyright work. As Judge Learned Hand said (speaking of the distinction between ‘idea’ and ‘expression’): ‘Nobody has been able to fix that boundary and nobody ever can’.”’
As analysed there by Jacob J, the boundary is really an issue of substantiality. If what is taken is an idea too general to constitute a substantial part of the idea embodied in the copyright work, there is no infringement. If, on the other hand, the idea within the copyright work is reproduced in sufficient detail, infringement occurs.
This has been considered in respect of copyright in a computer program. Navitaire Inc v easyJet Airline Co Ltd [2004] EWHC 1725 (Ch) concerned copyright in computer software in a ticketless airline booking system. The claimant, Navitaire, owned the copyright in the source code of a system called ‘OpenRes’. The first defendant, easyJet, had been a licensee and user of OpenRes. The parties fell out and easyJet engaged the second defendant to create software which would be indistinguishable in use and appearance from OpenRes when employed by travel agents or the public. Software called ‘eRes’ was created and it fulfilled easyJet’s instructions. After the software went live Navitaire sued for infringement of various copyrights, including copyright in the OpenRes source code. Navitaire did not contend that easyJet had had access to its source code or that the text of the source code had been copied. It argued that there had been ‘non-textual’ copying analogous to an author taking the plot of a literary work without using the language of the original, an established form of copyright infringement in law.
Pumfrey J discussed the issue in some detail, starting with a statement of what it was:
‘[5] There is here an issue of general importance. To emulate the action of a piece of software by the writing of other software that has no internal similarity to the first but is deliberately designed to “look” the same and achieve the same results is far from uncommon. If Navitaire are right in their most far-reaching submission, much of such work may amount to the infringement of copyright in the original computer program, even if the alleged infringer had no access to the source code for it and did not investigate or decompile the executable program.’
Having considered the facts, Pumfrey J turned to the point of principle. He referred to the idea/expression distinction, quoting Jacob J’s analysis of it in IBCOS and then stating:
‘[125] This does not answer the question with which I am confronted, which is peculiar, I believe, to computer programs. The reason it is a new problem is that two completely different computer programs can produce an identical result: not a result identical at some level of abstraction but identical at any level of abstraction. This is so even if the author of one has no access at all to the other but only to its results. The analogy with a plot is for this reason a poor one. It is a poor one for other reasons as well. To say these programs possess a plot is precisely like saying that the book of instructions for a booking clerk acting manually has a plot: but a book of instructions has no theme, no events, and does not have a narrative flow. Nor does a computer program, particularly one whose behaviour depends upon the history of its inputs in any given transaction. It does not have a plot, merely a series of pre-defined operations intended to achieve the desired result in response to the requests of the customer.’
Pumfrey J set out what he regarded as a better analogy:
‘[127] … Take the example of a chef who invents a new pudding. After a lot of work he gets a satisfactory result, and, thereafter, his puddings are always made using his written recipe, undoubtedly a literary work. Along comes a competitor who likes the pudding and resolves to make it himself. Ultimately, after much culinary labour, he succeeds in emulating the earlier result, and he records his recipe. Is the later recipe an infringement of the earlier, as the end result, the plot and purpose of both (the pudding) is the same? I believe the answer is no.’
As will be seen, Pumfrey J’s pudding has enjoyed approval by more than one court since. In Navitaire he drew support from what had been said by Lord Hoffmann in Designers’ Guild Ltd v Russell Williams (Textiles) Ltd [2000] 1 WLR 2416, at 2423:
‘My Lords, if one examines the cases in which the distinction between ideas and the expression of ideas has been given effect, I think it will be found that they support two quite distinct propositions. The first is that a copyright work may express certain ideas which are not protected because they have no connection with the literary, dramatic, musical or artistic nature of the work. It is on this ground that, for example, a literary work which describes a system or invention does not entitle the author to claim protection for his system or invention as such. The same is true of an inventive concept expressed in an artistic work. However striking or original it may be, others are (in the absence of patent protection) free to express it in works of their own: see Kleeneze Ltd. v. D.R.G. (U.K.) Ltd. [1984] F.S.R. 399. The other proposition is that certain ideas expressed by a copyright work may not be protected because, although they are ideas of a literary, dramatic or artistic nature, they are not original, or so commonplace as not to form a substantial part of the work. Kenrick & Co. v. Lawrence & Co. (1890) 25 Q.B.D. 99 is a well known example. It is on this ground that the mere notion of combining stripes and flowers would not have amounted to a substantial part of the plaintiff's work. At that level of abstraction, the idea, though expressed in the design, would not have represented sufficient of the author's skill and labour as to attract copyright protection.
Thus, Lord Hoffmann explained that the idea/expression distinction combines not just the issue of substantiality identified in IBCOS but also the separate and distinct principle that a claimant may not rely on his copyright to protect subject-matter which has insufficient connection with the nature of the copyright work. Substantiality is a universal aspect of copyright law applied by statute, see s16(3)(a) of the Copyright, Designs and Patents Ac 1988, so it would seem that the operative part of the idea/expression distinction as explained by Lord Hoffmann lies in the sufficiency of the connection between the nature of the copyright work and the nature of the protection provided by copyright in that work.
That said, where substantiality has application, changes made to UK copyright law to ensure that was consistent with EU law did not affect the UK law on substantial part. In SAS Institute Inc v World Programming Ltd [2013] EWCA Civ 1482, Lewison LJ noted:
‘[38] Our domestic legislation confines the doing of a restricted act (e.g. copying) to doing that act in relation to the work as a whole or any “substantial part of it”: Copyright Designs and Patents Act 1988 s.16 (1), s.16 (3), Nova Productions Ltd v Mazooma Games Ltd [2007] EWCA Civ 219, [2007] R.P.C. 25 at [29]. It has long been the position in domestic law that what is substantial is a question to be answered qualitatively rather than quantitatively. In Infopaq [Infopaq International A/S v Danske Dagblades Forening (C-5/08) [2009] ECR I-6569] the court said that parts of a work are entitled to the same protection as the work as a whole. But the parts in question must “contain elements which are the expression of the intellectual creation of the author of the work”: [39]. This is now the test for determining whether a restricted act has been done in relation to a substantial part of a work. Both counsel agreed that to interpret s.16 (3) in this way was consistent with the court's duty to interpret domestic legislation, so far as possible, so as to conform with European directives. I do not think that anything in the decisions of this court in Nova Productions Ltd v Mazooma Games Ltd and The Newspaper Licensing Agency v Meltwater Holding BV [2011] EWCA Civ 890, [2012] R.P.C. 1 casts doubt on that proposition.’
Returning to Navitaire, in that judgment Pumfrey J continued:
‘[129] The questions in the present case are both a lack of substantiality and the nature of the skill and labour to be protected. Navitaire's computer program invites input in a manner excluded from copyright protection, outputs its results in a form excluded from copyright protection and creates a record of a reservation in the name of a particular passenger on a particular flight. What is left when the interface aspects of the case are disregarded is the business function of carrying out the transaction and creating the record, because none of the code was read or copied by the defendants. It is right that those responsible for devising OpenRes envisaged this as the end result for their program: but that is not relevant skill and labour. In my judgment, this claim for non-textual copying should fail.
[130] I do not come to this conclusion with any regret. If it is the policy of the Software Directive to exclude both computer languages and the underlying ideas of the interfaces from protection, then it should not be possible to circumvent these exclusions by seeking to identify some overall function or functions that it is the sole purpose of the interface to invoke and relying on those instead. As a matter of policy also, it seems to me that to permit the “business logic” of a program to attract protection through the literary copyright afforded to the program itself is an unjustifiable extension of copyright protection into a field where I am far from satisfied that it is appropriate.’
The first sentence of paragraph 129 shows that Pumfrey J was concerned with both substantiality and the nature of the protection afforded by the copyright in suit. The remainder of paragraph 129 and paragraph 130 concern the latter, on which ground Navitaire’s claim of non-textual copyright infringement failed.
In the course of submissions Valos emphasised earlier passages in the judgment in which Pumfrey J found that what had been taken by easyJet could not be distinguished in relevant part from the manner in which other booking systems operate. That may have provided an alternative reason for the finding of non-infringement. But it does not detract from Pumfrey J’s conclusions on the law with regard to the application of the idea/expression distinction.
In Nova Productions Ltd v Mazooma Games Ltd [2007] EWCA Civ 219 the claimant claimed ownership of copyright in various artistic, literary and dramatic works which made up a video game. Jacob LJ, with whom the Chancellor and Lloyd LJ agreed, held that the claim to literary copyright failed on the ground of substantiality. He went on to consider whether the claimant was also trying to protect subject-matter having insufficient connection with the nature of the copyright work. He quoted paragraphs 125 to 130 of Navitaire, and considered the criticism advanced by counsel of Pumfrey J’s pudding analogy:
‘[48] Mr Howe attacked that. I quote his skeleton argument:
“this analogy is a poor one. The reason is that the first chef has deployed two quite distinct types of skill and labour. The first is the skill of devising a recipe, a skill which on no view forms part of the skill and labour protected by copyright in literary works. The second is skill and labour in reducing the recipe he has devised to written form. A copyist who copies from his pudding rather than from his recipe book may appropriate the former skill and labour but none of the latter.
By contrast, a copyist who copies the function of a computer program to write his own program to achieve the same results is clearly appropriating part of the skill and labour expended in designing the program.”
[49] He further developed the argument basing himself on recital 7 of the Directive. This says:
“‘computer program’ … also includes preparatory design work leading to the development of a computer program provided that the nature of the preparatory work is such that a computer program can result from it at a later stage”.
He asked us to suppose a case where there are two clear stages in the making of a program—a first stage where the designer sets out all the things he wants the program to be able do and a second stage (which may be by a different person) where the actual program code is written. Mr Howe contended that the first stage was intended to be protected as such, even if it consisted only of ideas as to what the program should do. Going back to the analogy, the “preparatory work” for the program is like the skill of devising the recipe and the actual program writing like the reduction of the recipe to written form. The difference, he submitted, is that for computer programs, unlike the recipe, the preparatory work is to be protected.
[50] I reject the argument. The reason is simple. The Directive does not say that mere ideas by way of preparatory design work are to be protected. As I have said it makes it clear that for computer programs as a whole (which includes their preparatory design work) ideas are not to be protected. What is protected by way of preparatory design work is that work as a literary work—the expression of the design which are to go into the ultimate program, not the ideas themselves.
[51] So for example, if Mr Jones had actually written a description of the pulsing, rotating cue, and synchronised power meter his description would (if not too trivial at least) be protected as a literary work. People could not copy that. But they could use the same idea. Similarly and more generally, a written work consisting of a specification of the functions of an intended computer program will attract protection as a literary work. But the functions themselves do not. Of course to someone familiar with the prior English law it is self-evident that copyright could subsist in such a description. The fact that a work can get copyright even if mundane, is old and familiar to an English lawyer. But the Directive needed to say that protection as a literary work should be provided for preparatory design work because not all Member States under their existing laws necessarily provided that. That is the whole point of the Directive—and the clear reason for it is recited in Art.1 .
[52] So I think Mr Howe's attack on Navitaire fails. The reasoning in Navitaire provides a second reason for dismissing this appeal. Pumfrey J. was quite right to say that merely making a program which will emulate another but which in no way involves copying the program code or any of the program's graphics is legitimate.’
I have quoted Jacob LJ’s views on counsel’s arguments in Nova because they are similar to those made at the present hearing on behalf of Valos.
In SAS Institute Inc v World Programming Ltd [2013] EWCA Civ 1482 the claimant was the developer of analytical software known as the SAS System which enabled users to carry out analytical tasks, mostly statistical analysis. Users did this by writing and running their own apps suitable for the task to be undertaken. The apps were written in a language called the SAS Language. The core component of the SAS System and additional components which increased functionality were together called the ‘SAS Components’.
The defendant (‘WPL’) created a product called the World Programming System (‘WPS’). WPS was designed to emulate much of the function of the SAS Components so that subject to minor exceptions, the same input by a user would produce the same output. Thus, customers’ apps performed in the same manner when run on WPS as they had when run on the SAS Components. The claimant brought an action for copyright infringement in various forms:
WPL had used the SAS Manuals as a technical specification for WPS and copied a substantial part of those manuals in creating WPS itself, thereby infringing copyright in the SAS Manuals (the ‘Manual to Program Claim’);
WPL had indirectly infringed copyright in the SAS Components in creating WPS (the ‘Program to Program Claim’);
WPL had infringed the copyright in the SAS Manuals by reproducing a substantial part of them in WPL's own WPS Manual and WPS Guide (the ‘Manual to Manual Claim’); and
WPL had repeatedly used the SAS Learning Edition outside the scope of the applicable licence to obtain additional information about the SAS System, and to check that the operations of WPS precisely replicated those of the SAS Components; it had thereby infringed SAS Institute's copyright in the SAS Learning Edition and acted in breach of contract (the ‘Learning Edition Claim’).
There was no suggestion that WPL had had access to or had copied any of the source code of the SAS Components or that it had copied any of the structural design of the SAS Components.
Arnold J referred questions to the CJEU relating to Council Directive 97/205, the Software Directive. Following judgment from the CJEU (Case C-406/10 EU:C:2012:259) Arnold J dismissed the claims of infringement save for part of the Manual to Manual Claim.
Permission to appeal was given in relation to the Manual to Program, Manual to Manual and Learning Edition Claims. It was accepted by the claimant that following the decision of the CJEU neither the SAS Language nor the functionality of the SAS System was protected by copyright under the Software Directive. Accordingly there was no appeal on the Program to Program Claim, but the issue of the protection of functionality did not fall away.
Lewison LJ, with whose judgment Vos and Tomlinson LJJ agreed, began by summarising the issue:
‘[1] The underlying issue in this case is the extent to which the developer of a computer program may lawfully replicate the functions of an existing computer program; and the materials that he may lawfully use for that purpose.’
Lewison LJ identified the two categories of intellectual effort that had gone into creating SAS Components:
‘[13] Nor is there any dispute that the intellectual effort involved in creating each of the SAS Components included both (i) intellectual effort in determining the requirements for the software and (ii) intellectual effort in designing and writing source code to implement those requirements. The first of these will have involved making choices about what the SAS components would do.’
The SAS Manuals were likewise intellectual creations of their authors but the information they provided was limited in content:
‘[15] There is also no dispute that each of the SAS Manuals is an original literary work in which copyright subsists. Nor is there any dispute that the creation of each of the SAS Manuals involved intellectual effort on the part of SAS Institute's employees. The SAS Manuals contain a wealth of information about the external behaviour of the SAS System but, not surprisingly, say almost nothing about its internal operation. As the judge put it at [60] and [250] of his first judgment:
“60. The SAS Manuals do not contain information about the internal behaviour of the SAS System. Thus they do not give any information about the internal file formats used by the SAS System, the intermediate language used to compile DATA Steps, the SAS object code which the SAS System uses when executing SAS application programs, or the statement structures which result from parsing the PROC steps. Still less do the SAS Manuals contain any details of the source code of the SAS System.”
“250. The SAS Manuals are nothing more (and nothing less) than a very detailed description of what the software does. They give the reader very little insight into how the source code achieves that. As noted above, Professor Ivey [SAS Institute's Expert] did not compare WPS to the SAS source code. When asked, he said that he would expect the two source codes to look different. Dr Worden [WPL's expert], who had compared certain aspects of the WPS code with the corresponding SAS code, said that they were indeed very different.”
Lewison LJ discussed the law on ideas as opposed to the expression of ideas and also the relationship between the functionality of a computer program and an idea, analysing in this regard the opinion delivered by Advocate-General Bot in SAS Institute.
Both the Manual to Program and Manual to Manual Claims raised the question of what copyright law protected in respect of the intellectual creativity that had gone into SAS Institute’s manual. Having considered what the Advocate-General had said and having concluded that the Court of Justice had decided nothing inconsistent with it, Lewison LJ said:
‘[61] … the question that the court is leaving to the national court is not whether there has been a reproduction of the intellectual creation of the author of the manual, but whether there has been a reproduction of the expression of the intellectual creation of the author of the manual. That is a significantly narrower question.’ (original italics)
Lewison LJ considered first the Manual to Program Claim:
‘[62] The essence of this claim is that in writing WPS in the Java programming language (and subsequently in C++) WPL has copied the SAS Manuals. This argument seems at first sight to be counter-intuitive, because the SAS Manuals themselves do not contain any programming language. They describe the functions that the program is to perform.
[63] Following the judgment of the CJEU the question remaining for the judge was whether the reproduction in WPS of elements described in the SAS Manuals constituted the reproduction of the expression of the intellectual creation of the author of the user manual. It is important to stress that it is only the intellectual creation of the author of the user manual that counts. The intellectual creation of the author of a different work (e.g. the computer program itself) is not relevant to this question. In addition, and perhaps more importantly, for the purposes of copyright what is relevant is not the intellectual creation itself, but the expression of the intellectual creation of the author of the manual: Infopaq at [39]; CJEU in our case at [65] and [68]. The functionality of a computer program is, quite simply, not a form of expression at all.’
This conclusion, that the functionality of a computer program is not a form of expression, was enough to dismiss the appeal in both the Manual to Program and Manual to Manual Claims. However, Lewison LJ considered how it fits in with the discussion in earlier cases of the subject-matter which may be protected by a particular form of copyright work:
‘[70] It is also the case that the European legislation was enacted against the background of many international treaties and well-established principles of copyright law, and that the relevant directives must be interpreted against that background: Infopaq at [32]. One of these principles is that for an infringement of copyright to exist, the defendant's work must represent the claimant's work in some real sense. This is an embedded feature of copyright law.’
Lewison LJ referred to Designers Guild and Nova Productions and then quoted the way in which the principle is set out by the authors of Copinger & Skone James on Copyright:
‘[72] Copinger & Skone James on Copyright (17th edn) explain the principle thus at para.7-37:
“It has already been pointed out that in general terms a work is not reproduced unless what has been produced represents the work in some real sense. A description in a novel of a scene from nature is thus not infringed by a drawing made to depict that scene. So, in the context of a literary work, the copyright in a book which described a method of teaching mathematics was not infringed by making a series of coloured rods which demonstrated that method, the copyright in written instructions for the making of a garment was not infringed by making the garment, and the copyright in the words and numerals in knitting guides was not infringed by making garments to those instructions. Again the copyright in a book of recipes would not be infringed by making a dish according to one of the recipes.”’
Lewison LJ stated his view that the CJEU in SAS Institute had changed the question, at least on the type of facts before the court: it was no longer whether the copyright in suit protected subject-matter of a particular nature:
‘[74] … the judgment of the CJEU [has], to some extent, changed the question. What is protected is the form of expression of an intellectual creation. The intellectual creation itself is not protected; and the functionality of a computer program does not count as a form of expression. The functionality of a computer program (in the sense of what it does and how it responds to particular inputs) falls on the ideas side of the line. It falls on that side of the line whether one is considering the Software Directive or the Information Society Directive. … the copying that SAS Institute alleged was not the copying of the form of expression of an intellectual creation, … In short, what WPL took was not capable of protection by copyright.’
Since the Manual to Program Claim failed, so did the Manual to Manual Claim to the extent that the alleged copying was of the underlying elements of the SAS Components. Lewison LJ approved the pudding example from Navitaire and inferred that Advocate-General Bot had also endorsed it:
‘[85] … in so far as the WPS manual described the WPS program, which had been created from observation of the functionality of SAS and its description in the SAS Manuals, it is exactly analogous to the writing by the second chef of his successful recipe, which does not infringe copyright in the first chef's recipe.’
The Learning Edition Claim has no relevance to this litigation.
The present case
Against the background of that case law, my conclusion on the present application can be shortly stated. The Valos Steps, part of the functionality of the Valos Computer Programs, are not a form of expression of the relevant intellectual creation, namely the Valos source code. The Valos Steps are therefore not protected by copyright in that source code. Copying the Valos Steps by the creation of the Edozo Steps (which I have assumed) is not an act capable in law of being an act of infringement of the copyright in the Valos source code.
During the course of argument the point of policy referred to by Pumfrey J in Navitaire at [130] (see above), was discussed. Counsel for Valos submitted that even if this was good policy, it must have a counterpart: a policy that time and money invested in the creation of functionality useful to the public should be protected by the law.
It may be that a strong belief in the need for such a counter-policy has generated the motive for Valos’s position in this litigation. I understand that. But there are answers. First, literary and/or artistic copyright in the Valos Steps themselves may be relied on to protect the intellectual creativity that went into devising them. Also, if the Valos Steps are inventive it may be that Valos could have sought patent protection provided the invention would not have fallen foul of art.52(2) and (3) of the European Patent Convention. Secondly, it is hard to see why Valos is worse off than a chef who has created a magnificent new pudding. Finally and most importantly, the case law indicates that the intention of legislature, as interpreted by the courts, was not to introduce any such counter-policy into copyright law in respect of claims such as those of the present case.
Conclusion
Those parts of the Defence and Counterclaim which allege indirect infringement of the literary copyright in the Original Valos Computer Program, the Subsequent Valos Computer Programs and the Valos Coded Prompts shall be struck out.