The Supreme People's Court of the People's Republic of China had to decide the case of Wangjing vs. Yibang, et al, (2021) Supreme Court-IP Tribunal-Civil Case-Final Judgment No.51, in which the licensing of OpenWRT as part of the software under the GPL-2.0 was invoked as a defense against the claims of the manufacturer in a copyright infringement case.
The facts of the case
Wangjing Technology developed a proprietary system software, "OfficeTen", designed for network operation in the communications industry. This software consisted of two components: the underlying system software based on OpenWRT (free software under the GPL-2.0) and the upper layer functional software, which Wangjing claimed was an "independent and separate program" from the OpenWRT system. Wangjing registered the copyright of OfficeTen and invested significant resources in its development. According to Article 7 of the PRC Regulations on Software Protection, a copyright registration certificate is refutable evidence of authorship of a work [The "Regulations on Computer Software Protection" is a special law under Art. 64 of the Copyright Law of the People’s Republic of China].
Former Wangjing employees, now working for Qi'ao Company, were accused of illegally downloading the source code of "OfficeTen" and creating a derivative version with only minor modifications. Qi'ao then collaborated with Yibang Company, which distributed the infringing software.
Both Yibang and Wangjing had applied for a public contract from China Telecom Guangdong. Yibang eventually won the contract. Wangjing received information that their software had been used and launched a technical investigation.
Wangjing filed a criminal complaint, and the Suzhou Public Security Bureau (police) launched an investigation. The Bureau engaged the Shanghai Oriental Computer Forensic Institute to examine the devices from the two manufacturers for software similarities.
Several reports from the Shanghai Oriental Computer Forensic Institute found that both the compiled software and the source code of the devices showed extensive similarities.
Parallel to the criminal proceedings, Wanjing has initiated civil proceedings in which it has sued Yibang, Qi'ao and the employees involved, demanding compensation, an injunction and a public apology.
Legal Issues
Based on the parties' pleadings and the facts of the case, the Court identified the key issues in the case as:
(1) whether Wangjing owns the software copyright of the software in question;
(2) whether Yibang and Qi'ao jointly infringed;
(3) whether the defense of non-infringement raised by Yibang and Qi'ao based on the GPL-2.0 is established; and
(4) if infringement is established, whether the civil liability determined by the court is appropriate.
(1) Copyright Ownership
Wangjing Technology claimed ownership of the "OfficeTen" software, which they had registered with the National Copyright Administration. Based on the results of the forensic investigation and the fact that 1,694 files are not licensed as open source software, as well as the fact that OfficeTen has been registered by the National Copyright Administration, the court concluded that Wangjing is the copyright holder.
(2) Infringement by Qi’ao and Yiban
The core allegation was that Qi'ao copied and modified Wangjing's software after gaining unauthorized access to its source code. The court found substantial similarity between Wangjing's software and the allegedly infringing software, as evidenced by forensic reports. Yibang's role in distributing the infringing software further implicated it in the infringement. The court found that Qi'ao and Yibang jointly committed copyright infringement by copying, modifying, and distributing Wangjing's software without authorization.
(3) Defense of non-infringement based on the GPL-2.0
Qi'ao and Yibang argued that because Wangjing's software was based on OpenWRT (licensed under the GPL-2.0), it was subject to open source requirements, and therefore their use of the software did not constitute copyright infringement. Wangjing argued that the upper layer functional software was a separate, independent creation that was not subject to the GPL-2.0 license.
The court rejected the defendants' GPL-2.0 defense for several reasons:
This is a copyright infringement case regarding OfficeTen. It is not a contractual dispute. The Court stated:
“Although the Software at issue is subject to a license agreement, i.e. the GPL-2.0 agreement, based on the principle of the privity of contract, it is not appropriate to determine all in present case whether the Software at issue is wholly or partially subject to the GPL-2.0 agreement, whether Wangjing Company violates the GPL-2.0 agreement and whether Wangjing Company shall bear any liability for breach of contract or infringement, while the right holder of the OpenWRT system software is not a party to this case.”
The copyright holder of OpenWRT was not a party to the case, making it inappropriate to address potential GPL-2.0 violations in that context. The Court stated:
“while the right holder of the OpenWRT system software is not a party to this case, it is also difficult to find out the facts related to the GPL-2.0 agreement as follows: whether the Software at issue is subject to the GPL-2.0 agreement, this issue involves the following considerations whether the underlying system software is subject to the GPL-2.0 agreement, whether the upper layer functional software constitutes an “independent and separate program” under the GPL-2.0 agreement, and how to define the technical measures of isolation, the mechanism of communication and the semantics of communication between the two software, and common understanding and common practices about the copyleft effects of the GPL-2.0 agreement.”
No evidence was provided that Wangjing renounced its copyright under the Copyright Law of the People's Republic of China in OfficeTen through the GPL-2.0. Assuming that Wangjing violated the GPL-2.0 and its right to OfficeTen was defective, such defective right shall not affect its right to seek remedies in the present case against Defendants' infringement. The Court stated:
“For the reasons stated above, in an infringement dispute where the software has not yet been open-sourced, the copyright owner of the software believes that the software is not subject to the GPLv2 agreement, and the accused infringer raises the non-infringement defense based on the GPLv2 agreement, the question of whether the software developer per se has violated the GPLv2 agreement and the question of whether he or she enjoys the software copyright are relatively independent legal issues, and it is inappropriate to confuse the two issues, so as not to unreasonably deprive or restrict the software developer’s rights based on his or her original contributions in accordance with the law. However, it should be noted that the final ruling in present case, which finds the accused acts to constitute infringement and upholds part of Wangjing Company’s claims, does not exempt Wangjing Company from his liability in potential lawsuits of either breach of contract or infringement in the future.”
Decision
• The court denied the appeal by Qi’ao and Yibang, affirming the original judgment.
• Qi’ao and Yibang were held jointly liable for compensating Wangjing Technology with CNY 500,000 (around 70,961 USD) and required to publish a notice on Yibang’s website to eliminate the negative effects of the infringement. Interestingly, the court took into account the fact that significant parts of OfficeTen were based on OpenWRT when determining the amount of damages: “Since the OpenWRT system software is already a relatively mature communication control software, with contributions from numerous developers and a substantial amount of written code, the court of first instance has already taken this into consideration when looking at the adjudicated amounts, which also aligns with the aforementioned principle of proportionality.”
• Qi’ao and Yibang were also ordered to bear the trial fees of CNY 8,800 (around 1,249 USD) for the second instance.
• The judgment is final and binding.
Additional remarks
The Higher Regional Court of Karlsruhe (Judgment of November 13, 2020, Ref. 6 U 60/20) came to a similar conclusion in the Wordpress Theme case, in which the GPL-2.0 was also asserted in defense. Here, too, a distinction is made depending on whether the owner of an (alleged) derivative work copyright has licensed the derivative work under the GPL-2.0. The mere possibility of a violation of the copyleft is not enough to defend against copyright claims. The enforcement of the GPL-2.0 is the responsibility of the licensors and cannot be enforced by users declaring the software to be “GPL-licensed”. The copyleft effect does not automatically result in GPL licensing; instead, this must be actively undertaken by the author of a derivative work.
We would like to thank the OpenAtom Foundation for translating the judgment into English within the Contransus Project so that those who do not know Chinese can understand it. The translation is licensed under CC BY-NC-ND 4.0.
