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Hacking the Xbox

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Chapter 12 - Caveat Hacker 189<br />

Such a contractual clause was recently found enforceable. In Bowers v.<br />

Baystate Technologies, Inc., 40 an inventor marketed a patented computeraided<br />

design (CAD) software “toolkit” with an anti-reverse-engineering<br />

license clause. Baystate, a competitor, reverse engineered Bowers’<br />

software and <strong>the</strong>n marketed a competing CAD toolkit. After some<br />

complicated litigation, <strong>the</strong> court eventually held, among o<strong>the</strong>r things, that<br />

Baystate breached its contract with Bowers.<br />

The court held that <strong>the</strong> license wasn’t preempted because a contract has<br />

an “extra element” — <strong>the</strong> parties must agree. 41 It follows that federal<br />

copyright law can never preempt a contractual prohibition. The problem<br />

with <strong>the</strong> Bowers decision is that it focuses only on <strong>the</strong> specific preemption<br />

clause of <strong>the</strong> Copyright Act and completely ignores constitutional<br />

“conflict” preemption. 42<br />

The Uniform Computer Information Transactions Act (UCITA) is a state<br />

legislative atttempt to address <strong>the</strong>se issues, but it is also mired in controversy.<br />

Trade secrets and <strong>the</strong> Economic<br />

Espionage Act<br />

The Economic Espionage Act (EEA) 43 created <strong>the</strong> first federal cause of<br />

action for trade secrecy misappropriation. But it has no reverse engineering<br />

defense. This is troubling because rights granted under <strong>the</strong> EEA arguably<br />

implicate certain reverse engineering activities previously thought to be<br />

lawful. In particular, it’s unclear whe<strong>the</strong>r decompilation and disassembly of<br />

computer programs may violate EEA rules that forbid duplicating trade<br />

secrets.<br />

The Responsible Hacker:<br />

Ignorance Is No Defense<br />

In general, <strong>the</strong>re are two ways you can violate intellectual property laws.<br />

Direct infringement means that you actually infringed. Indirect infringement<br />

means that you facilitated actual infringement by someone else. For<br />

example, in <strong>the</strong> Betamax case, <strong>the</strong> issue was whe<strong>the</strong>r Sony, by selling<br />

VCRs, could be found liable for its customers’ copyright infringement.<br />

40 302 F.3d 1334 (Fed. Cir. 2002).<br />

41 The court relied on an earlier case, ProCD, Inc. v. Zeidenberg,<br />

86 F.3d 1447, 1454. (7th Cir. 1996) (“A copyright is a right against<br />

<strong>the</strong> world. Contracts, by contrast, generally affect only <strong>the</strong>ir<br />

parties; strangers may do as <strong>the</strong>y please, so contracts do not<br />

create ‘exclusive rights.’”).<br />

42 EFF has submitted an amicus brief supporting Baystate’s<br />

petition for rehearing en banc in <strong>the</strong> case. [add cite]<br />

43 Economic Espionage Act of 1996, Pub. L. No. 104-294, 110 Stat.<br />

3488 (codified at 18 U.S.C. § § 1831-1839 (Supp. V 1999)).

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