Atari Games Corp. v. Nintendo of Am., Inc. - 975 F.2d 832 (Fed. Cir. 1992)

Rule:

A motion for preliminary injunction will be granted if the movant shows either a likelihood of success on the merits and the possibility of irreparable injury, or that serious questions going to the merits were raised and the balance of hardships tips sharply in its favor. In a claim for copyright infringement, a showing of a reasonable likelihood of success on the merits raises a presumption of irreparable harm.

Facts:

Defendant, a video game system creator, designed a computer program that prevented its game system from accepting unauthorized game cartridges. Plaintiff, a licensee of defendant, applied to the copyright office for a reproduction of defendant's program. Plaintiff then replicated the source code and created its own program able to unlock defendant's game system. Plaintiff moved to enjoin defendant's alleged antitrust violations based upon certain restrictions in the licensing agreement. Defendant moved to enjoin plaintiff's infringement of its copyrighted program. Defendant prevailed. Plaintiff appealed, asserting copyright misuse as a defense.

Issue:

Did the district court err in granting defendant’s request for a preliminary injunction? 

Answer:

No.

Conclusion:

The court affirmed, holding that imposition of a preliminary injunction was justified as there was a sufficient showing that the program contained protectable expression. Plaintiff's reproduction of an unauthorized copy of defendant's program from the copyright office violated 17 U.S.C.S. § 106(1). A reverse engineering defense was inapplicable as plaintiff was not in authorized possession of the source code. Plaintiff's program was substantially similar, and its unclean hands prevented it from invoking a misuse of copyright defense.