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Enforcing Reverse Engineering Prohibitions in Shrink- and Click-wrap Licenses: A Report on Bowers v. Baystate Technologies, Inc.

By William S. Coats, Monte M.F. Cooper, and Mark J. Shean

The practice of “reverse engineering,” whereby one company obtains the product of a competitor and works backwards “to divine the process which aided in its development or manufacture,” has long been accepted as a legitimate (and sometimes wholly necessary) practice in the computer software marketplace. Kewanee Oil Co. v Bicron Corp., 416 U.S. 470, 476 (1974). It also has been upheld by Courts as a form of “fair use,” whereby competitors may make copies of one another's source or object code for purposes of study and analysis without incurring liability for copyright infringement. See, eg, Sony Computer Entertainment Inc. v. Connectix Corp., 203 F.3d 596 (9th Cir. 2000); Sega Enterprises Ltd. v. Accolade, Inc., 977 F.2d 510 (9th Cir. 1992) (amended opinion); Atari Games Corp. v. Nintendo, 975 F.2d 832 (Fed. Cir. 1992).

Proponents of reverse engineering argue that it results in the public obtaining less expensive (and often higher quality) products. The practice is reviled, however, by many prominent software companies that view it as impairing their ability to protect intellectual property that often has been developed at great expense.

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