Law and technology

A recent court case (see below) has clarified (likely for the first time) the law relating to making a backup of proprietary software. The case decided that copying software to create a cold server, and occasionally testing the cold server, did not infringe copyright. The case is Australian, though the relevant provisions of our Copyright Act are essentially the same.

Making a backup copy of software is expressly permitted under section 80 of the Copyright Act 1994. However, a backup copy can only be “used” if the original is lost or destroyed (or it can be used in lieu of the original copy). One of the issues the case clarified is that the occasional testing of a backup – which is of course sensible – does not breach that restriction.

However, if the purchaser was given an express direction that a backup cannot be made, then section 80 does not apply (i.e. a backup cannot be made). It is important to note that the direction not to make backups is only effective if given before or at the time the software was acquired. If the direction/prohibition was given in a click-through licence, but the software was “acquired” before that licence was accepted, section 80 will apply (i.e. a backup can be made). However, the licence agreement could still impose various other conditions about how the backup can be used/tested.

When the Copyright Act backup provisions were drafted, most backup scenarios would have involved physical media, not a failover system (hot/cold) backup. The court decision confirms that in the absence of any pre-purchase direction (which could be a simple notice on the package or on the website the software is downloaded from), a cold server backup can be made, and (subject to the licence terms) occasionally tested. A user could not, however, rely on section 80 to set up a hot server, as this would involve “use” of the copied software beyond the extent permitted.

It was good to see the court make a well-researched and practical judgment, following a hearing that involved a number of IT experts, including disaster recovery specialists. By the way, if this all sounds like much ado about not very much, it is worth noting the software in question was very expensive main-frame based software ($1m plus per licence) which, presumably, justified the cost of going to court. It is highly unlikely that Microsoft or Apple would have a major battle over a user making a simple backup of their software! Indeed, many software houses expressly permit it.

Read my full article here:

Computer program backups and the Copyright Act (Clendons Barristers & Solicitors)

The judgments:

Primary – Racing & Wagering Western Australia v Software AG (Australia) Pty Ltd [2008] FCA 1332
On appeal – Racing & Wagering Western Australia v Software AG (Australia) Pty Ltd [2008] FCA 1526