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Vault Corp v. Quaid Software Ltd.

United States Court of Appeals for the Fifth Circuit
847 F.2d 255 (1988)


Facts

Vault Corporation (Vault) (plaintiff) manufactured computer disks that contained PROLOK, a system aimed at preventing the unauthorized copying of software programs contained on the disks. Vault sold PROLOK disks to computer-software producers, who installed their own programs onto the disks. Each PROLOK disk contained an irremovable fingerprint on the magnetic surface of the disk. After a user installed the program, PROLOK software would run only if the disk containing the specific fingerprint for the software was inserted into the computer’s disk drive. Together, the PROLOK software and the fingerprint on the physical disk prevented the owner of a computer program from making a fully functioning copy of the program. Quaid Software Limited (Quaid) (defendant) sold a disk that contained a program called RAMKEY. RAMKEY allowed a user to circumvent PROLOK’s protective functions by allowing copies of PROLOK disks to fool the PROLOK software into believing that the copies contained the unique fingerprint of the original disks. As a result, a user could make fully functional copies of the computer programs contained on PROLOK disks. Vault brought a copyright-infringement suit and sought an injunction against Quaid’s use and sale of disks containing RAMKEY. The district found for Quaid, holding that the RAMKEY program was authorized under § 117 of the Copyright Act. Vault appealed.

Rule of Law

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Issue

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Holding and Reasoning (Reavley, J.)

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  • A “yes” or “no” answer to the question framed in the issue section;
  • A summary of the majority or plurality opinion, using the CREAC method; and
  • The procedural disposition (e.g. reversed and remanded, affirmed, etc.).

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