Storage Technology Corp. v. Custom Hardware Engineering & Consulting, Inc.

Storage Technology Corporation (StorageTek) (plaintiff) made automated tape-cartridge libraries that used copyrighted code to turn on. Specifically, StorageTek copyrighted both functional code and maintenance code. These codes were intertwined and both automatically copied for a library to activate. StorageTek signed license agreements with purchasers of the libraries, allowing the purchasers to use the code. Custom Hardware Engineering & Consulting, Inc. (CHE) (defendant) repaired StorageTek data libraries. To do so, CHE turned them on, thereby using StorageTek’s code without a license. After activating a library, CHE rebooted the library and intercepted error messages that the maintenance code created. CHE used those messages to diagnose and repair the libraries. StorageTek sued CHE for copyright infringement. CHE argued that its activities were protected by 17 U.S.C. § 117(c). CHE also argued that it was entitled to use the licenses that StorageTek had granted to CHE’s customers. StorageTek argued that the maintenance code could be used for other things once a library was activated, thus taking CHE’s use outside the protections of § 117(c). StorageTek also argued that CHE’s use of the machine violated the anticircumvention provisions in the Digital Millenium Copyright Act (DMCA). The trial court granted StorageTek a preliminary injunction.