              LEGAL PROTECTION OF COMPUTER DATABASES

~ 1991 Losey
4919 words
                                17 pages







RALPH C. LOSEY
Subin, Shams, Rosenbluth & Moran, P.A.
111 N. Orange Ave., Suite 900
Orlando, Florida  32801
407-841-7470
                           407-648-4995 (fax)




















                 LEGAL PROTECTION OF COMPUTER DATABASES

     There are three main ways to protect all computer software, including
computer databases:  copyright, trade secret and contract.  Ideally, all
three of these legal means can be employed, along with other practical non-
legal methods, to provide the maximum protection against the unauthorized
copying and use (a/k/a "piracy") of a database.  There are, of course,
other legal theories that could be argued in a law suit to protect
databases, such as unfair competition and conversion, however, these
theories may be preempted by copyright law.  See: Southern Bell Tel. & Tel. 
v. Associated Telephone Directory Publishers, 756 F.2d 801, 810 fn. 9 (11th
Cir., 1985) (unfair competition);  Financial Information, Inc. v. Moody's
Investors Service, Inc., 808 F.2d 204 (2nd Cir. 1986) (misappropriation);
The Law and Business of Computer Software; Supra, pg. 22-18
(misappropriation theories and preemption).  
     There are also numerous ingenious non-legal or practical means and
strategies which can be employed to prevent the unauthorized copying of a
computer database.  These practical methods include the deliberate
placement of false or hidden data or "seeds", to facilitate the detection
of copying.  Eg.:  Rockford Map Pub.  v.  Dir. Service Co. of Colorado, 768
F.2d 145, 147 (7th Cir., 1985) (Phony middle initials of names on a map
spelled out Rockford Map Inc. when read from top of the map to the bottom).
                      WHAT IS A COMPUTER DATABASE?
     The computer database is a new type of intellectual property of
growing importance in today's world.  Essentially it is a collection of
information stored so that it can be selectively searched and the desired
information retrieved using a computer.  The Law and Business of Computer
Software, Toedt Ed., Ch. 22, Computer Databases, H. Pearson, pg. 22-2,
Clark Boardman (1990).  As society moves further into the informational age
the significance and dollar volume of database products should increase. 
Since this is a relatively new type of property, American law is having to
rapidly evolve and create new standards and legal principles to try and
protect against its misuse and theft.  
     Databases have long existed in manual or book form. Contemporary
examples of manual databases still abound, such as the phone book and many
reference books, including legal reporters.  The computer database is
essentially an information compendium like a phone book which has been
placed in a computer and thereby automated.  When information is so
computerized, however, there are many more ways for the information to be
accessed, manipulated  and used; the value of the database to users is
thereby greatly enhanced.  Some popular examples of computer databases
include legal databases such as Westlaw and Lexis, and various business and
scientific databases like those found on a computer network such as Dialog.
                              COPYRIGHT LAW
     In order to have a framework for an analysis of the legal protection
of computer databases, and to show the basic problems in trying to legally
protect them from computer piracy, a thorough review of Copyright law is
first necessary.
     The United States Copyright Office in its publication Circular 65:
Copyright Registration for Automated Databases defines an automated
database as a "a body of facts, data, or other information assembled into
an organized format suitable for use in a computer and comprising one or
more files."  The federal Copyright statutes do not yet specifically list
automated databases as a copyrightable subject matter. 17 USC  101,  102. 
Nevertheless, the Copyright Office follows case law and allows a computer
database to be copyrighted as a literary work, even though they are not
specifically included in the statutes.  See Eg.: Lane  v. First Nat. Bank
of Boston, 687 F.Supp. 11 (D.C. Mass. 1988). 
     The Copyright Office considers a computer database to be copyrightable
as a "compilation".  The law defines compilation as a work: 
     formed by the collection and assembling of preexisting materials
     or of data that are selected, coordinated or arranged in such a
     way that the resulting work as a whole constitutes an original
     work of authorship.
     17 USC  101  
Federal copyright law extends copyright protection to compilations as a
form of literary work.  17 USC  103.  In addition to computer databases,
a compilation can be a collective work such as a periodical, anthology and
encyclopedia, or a reference work such as a directory, index, map,
telephone book, guide book, law reporter, catalog, chart, or racing guide. 
     The "literary work" in a computer database which may be protected is
composed of four parts: (1) selection of the contents; (2) the coordination
of the contents internal to the program; (3) the arrangement of all of the 
elements of the database; and, (4) the contents itself.  Computer Software,
 2.08A(2)(c)(i), L.J. Kutten, Clark Boardman (1990).  The copyright of a
compilation may extend to one of these parts without including the others. 
     Copyright law originates in Article 1, Section 8 of the Constitution
of the United States which says that Congress shall have the power:  
     To promote the Progress of Science and useful Arts, by securing
     for limited Times to Authors and Inventors the exclusive Right
     in their respective Writings and Discoveries.

To implement this constitutional right Congress enacted copyright and
patent laws.  The copyright law was written to protect "original works of
authorship".  17 USC  102.  

     Over the centuries Courts have looked to see if a work has
"originality" or not to determine if it may receive copyright protection. 
Kamar Int'l  v.  Russ Berrie & Co., 657 F.2d 1059, 1061 (9th Cir. 1981)
(originality is the sine qua non of copyrightability).  Originality
requires an author to contribute something more than a "merely trivial"
variation which is recognizably "his own".  Id.   A work must show some
"creativity", albeit only a minimal amount, in order to meet the
originality test, and it is not subject to copyright if the work merely
copies an existing work.  See:  Copyright Protection For Citations To A Law
Reporter, Intellectual Property Law Review, pgs. 444-456, Norris Ed., 1988. 
     This essential element of "creativity" is weak or completely absent
in many manual reference works or computer databases.  For example, what
creativity is there in an alphabetical listing of stocks with prices? 
     Another basic problem in protecting a database is that copyright law
does not prohibit the copying of facts, even newly discovered or
expensively acquired facts, nor does it prohibit the copying of ideas. 
Harper & Row, Publishers, Inc. v. Nation Enterprises, 471 U.S. 539, 556,
105 S.Ct. 2218, 85 L.Ed2d 588 (1985) ("no author may copyright his ideas
or the facts he narrates"); Kregos v. Associated Press, 731 F.Supp. 113,
117 (S.D.N.Y. 1990) (protecting facts would unreasonably limit the public's
right to use information in the public domain);  Mazer v. Stein, 347 U.S.
201 (1954) (distinguishes copyrights from patents and holds that copyright
protects particular expressions of ideas, but not the ideas themselves). 
     Copyright law can only provide protection to the arrangement and
coordination of facts in a database, and even then there must be some
originality to the collection and arrangement for it to be protected.  See
Eg.: 17 USCA  103 and cases cited therein.
     Typically the preparation of a database requires a significant
expenditure of time, effort and money to cull and select information from
many different sources (the "selection" aspect of the "selection,
coordination and arrangement"), but little or no original creativity to
express the facts, or arrange them.  In these circumstances, where the
compiler gathers and compiles raw facts, he did not create the facts, he
just discovered or uncovered them, sometimes at great expense.  So how can
you prevent copying of the work?
     In order to lend copyright protection to merely factual databases,
some courts have tried to move away from a strict application of the
creativity test, to also employ an "industriousness" or "sweat of the brow"
test to determine if the database is an "original" enough work to be
afforded copyright protection.  Southern Bell Tel. & Tel.  v.  Associated
Telephone Directory Publishers, 756 F.2d 801, 809 (11th Cir. 1985).  These
Courts, spearheaded by Judge Learned Hand, found "originality" from the
"labor and expense" expended to make the compilation, rather than from any 
real "creativity" of the author. Id.;  Jeweler's Circular Publishing Co. 
v.  Keystone Publishing Co., 274 fed. 932 (S.D.N.Y. 1921 (L. HAND, J.),
aff'd, 281 F. 83 (2nd Cir. 1922), cert. denied, 259 U.S. 581, 42 S.Ct. 464,
66 L.Ed. 1074 (1922) (the first express "industriousness" standard case); 
West Publishing Co.  v.  Mead Data central, Inc., 799 F.2d 1219 (8th Cir.
1986);  The Law and Business of Computer Software, Supra pg. 22-8.  
     Under the sweat of the brow doctrine, copyright could prevent the
unauthorized copying of facts in a database, if the compiler could show
that sufficient effort went into the acquisition and selection of the data
to make it original.  The protection would lie even if the information
compiled was public knowledge or otherwise not protected.  Southern Bell
Tel. & Tel.  v.  Associated Telephone Directory Publishers, Supra pg. 810.
     Other Courts, however, continued to analyze a database dispute by
using traditional concepts of creativity, and criticized the "sweat of the
brow" standard.  Miller  v.  Universal City Studios, Inc., 650 F.2d 1365,
1369 (5th Cir. 1981);  Lane  v. First Nat. Bank of Boston, 687 F.Supp.
(D.C. Mass. 1988).  In the words of the Second Circuit Court of Appeals:
          To grant copyright protection based merely on the "sweat of the
          author's brow" would risk putting large areas of factual research
          material off limits and threaten the public's unrestrained access
          to information.
          Financial Information, Inc. v. Moody's Investors Service, Inc.,
          Supra pg. 207.
     A recent unanimous decision of the United States Supreme Court has
followed the Miller line of cases and sounded the death knell to Learned
Hand's sweat of the brow doctrine.  Feist Publications, Inc. v. Rural
Telephone Services Co., Inc., 59 U.S.L.W. 4251 (March 26, 1991).
     In Feist the compilation was manual, it was the phone book, for which
the phone company had made a valid copyright registration.  The alleged
infringer, Feist Publications, was found to have copied large portions of
the white pages from Rural Telephone Services Companies phone book.  Feist
Publication's repetition of four fictitious listings, or seeds, which Rural
Telephone had planted in their white pages helped to prove that.  Feist
Publications included the names and addresses from Rural Telephone's white
pages in its competing phone books.  Rural Telephone argued that the white
pages listing of names and addresses in its phone book, although admittedly
facts, was still entitled to copyright protection.  It contended that its
efforts to obtain and select these facts should be protected, and that its
competitor, Feist Publications, should be required to go to the same effort
to obtain the information, and should not be allowed to benefit from its
research and just copy the information.  Id. at pg. 4252.   
     The trial court agreed and entered a judgment for copyright
infringement in favor of Rural Telephone.  Rural Telephone Service Co.,
Inc. v. Feist Publications, Inc., 663 F. Supp. 214, 218 (1987).  In an
unpublished opinion the Tenth Circuit Court of Appeals affirmed, but the
Supreme Court reversed holding:
          The `sweat of the brow' doctrine had numerous flaws, the most
          glaring being that it extended copyright protection in a
          compilation beyond selection and arrangement - the compiler's
          original contribution - to the facts themselves. ... `Sweat of
          the brow' courts thereby eschewed the most fundamental axiom of
          copyright law - that no one may copyright facts or ideas. ...
          they handed out proprietary interests in facts and declared that
          authors are absolutely precluded from saving time and effort by
          relying on facts contained in prior works.
          Id. at pgs. 4254-4255.
     The Supreme Court held that the white pages portion of the phone book
was not entitled to copyright protection, even though the rest of the book
was.  Therefore Feist Publications, and anyone else, was free to copy the
white pages.  As Justice O'Connor concluded in her unanimous opinion:
          Because Rural's white pages lack the requisite originality,
          Feist's use of the listings cannot constitute infringement.  This
          decision should not be construed as demeaning Rural's efforts in
          compiling its directory, but rather as making clear that
          copyright rewards originality, not effort.
          Id. at pg. 4257.
     Now that the sweat of the brow doctrine is dead, it is clear that raw
facts in a database may not be protected by copyright, regardless of the
time or expenses that went into locating them.  Still, in many databases
the data itself, or the particular expressions of the facts, may have been
created by the author.  In such cases the data has originality and can be
protected.  An example of this which is used by the Copyright Office is a
full text bibliographic database.  There the author not only selects the
particular books to be included in the bibliography, but also the author
himself writes his own description as to each of the books.  Since the
author himself created the entire contents of the database, both the
selection and compilation aspect of the database, and the contents of the
database, are subject to copyright protection.
      Even if the contents are raw facts, not new materials created by the
author, the compilation aspects of the database (selection, coordination
and arrangement) may still receive copyright protection.  Copyright law 
prevents the copying of the coordination and arrangement of the facts, the
format of data presentation and manipulation, provided that the format and
means are original.  This entails a consideration as to whether the
coordination and arrangement are novel and unique, or whether the
arrangement itself contains information.  
     In a dispute between West Publishing Companies and Mead Data central,
Inc., West's arrangement of case law was found to be original and entitled
to copyright.  West Publishing Co.  v.  Mead Data central, Inc., Supra at
pg. 1226.  The computer research service "Lexis", owned by Mead Data,
competes with West Publishing's, "Westlaw", to provide computer assisted
research services to lawyers.  Both services use computers to locate and
display case decisions on a computer screen.  The first screen display of
a case in both Lexis and Westlaw includes an identification of the citation
to the case, thereby indicating the page on which the decision begins in
the particular West Reporter.  The judicial opinions are of course not
copyrightable, and West concedes that Lexis and others may use the citation
of a case and identify the first page without infringing West's copyright
under the "fair use" copyright doctrine.  Id. pg 1222; 17 U.S.C.  107.  
West does, however, claim a copyright to all of its page references, and
it limits the fair use exception to the citation.
     In 1985 Lexis announced its intention to take page identification a
step further by offering a service called "star pagination".  This feature
would insert in the Lexis opinion display the page numbers from West's
National Reporter Systems publications.  Only in this way could a Lexis
user determine what West page number corresponded to the portion of an
opinion viewed without having to physically refer to the West publication
in which the opinion appears.  Id.
     West sued for an injunction to prevent the introduction of this new
pagination feature claiming it would infringe its copyright.  Mead Data
argued that the arrangement of the cases was not an original creation and
thus was not copyrightable.  West contended that the order and arrangement
of the opinions in its reporters was sufficiently original and creative for
a copyright.  The trial court and Eighth Circuit Court of Appeals agreed
with West and an injunction was entered prohibiting Lexis from introducing
this feature.  In the words of the Eighth Circuit:
          We conclude, as did the District Court, that the arrangement West
          produces through this process is the result of considerable
          labor, talent and judgment.  As discussed above ..., to meet
          intellectual-creation requirements a work need only be the
          product of a modicum of intellectual labor; West's case
          arrangements easily meet this standard.
          Id. pgs. 1226-1227.
     Not all compilations, however, will meet even a minimal originality
standard.  Thus for example, if the selection, coordination and arrangement
of data in a database is a mechanical task only, and represents no original
authorship or creativity, it is not subject to copyright protection.  The
example given for this by the Copyright Office is the mere transfer of data
from hard copy to computer storage.  In other words, if you simply transfer
data from one medium to the other, and do nothing creative in deleting
portions or adding portions, then there is no original authorship to be
protected.  
     The Feist Publications case provides another example.  The Supreme
Court held that the alphabetical arrangement of names in the white pages
was not entitled to copyright because:  "there is nothing remotely creative
about arranging names alphabetically ... It is not only unoriginal, it is
practically inevitable."   Feist Publications v. Rural Telephone Services
Co., Inc., Supra at pg. 4257.  This is similar to another copyright
doctrine which is important to computer law: "functionality", whereby an
aspect of a computer program will not be protected by copyright if it is
merely utilitarian, rather than original.  Lotus Development Corporation
v. Paperback Software International, 740 F.Supp. 37, 52-58, 68 (D.C. Mass.
1990) (Lotus 123 interface was an original expression entitled to copyright
and was not merely a utilitarian function).
     A recent decision by a federal Judge in New York shows another example
where both the information selected, and form of presentation, were found
to be unoriginal and thus not entitled to copyright.  Kregos v. Associated
Press, 731 F.Supp. 113 (S.D.N.Y. 1990).  This involved a compilation of
statistics on baseball pitchers which was created by George Kregos and
published in newspapers nationwide.  The statistics were presented in nine
columns with one column for wins, losses, earned run average, etc.  
     Associated Press began publishing a rival form in its papers which was
virtually identical to Kregos' form.  Kregos sued to try and stop the rival
database from presenting the statistics in the same format.  The Court
found that there was no valid copyright of Krego's work because: (1) the
data itself (baseball statistics) was in the public domain (facts);  (2)
the particular statistics selected for inclusion in the form were
commonplace and required no creativity; and, (3) the format of display was
not novel or unique, it was analogous to a blank form which conveys no
information.  In the words of the Court: 
     Since an extremely limited number of ways to practically publish a
     pitching form exist, plaintiff's form does not exhibit the requisite
     selection or arrangement to receive protection....  
     (T)he facts ... are distinguishable (from other cases where
     copyright was upheld) due to the absence of true selection or
     arrangement by plaintiff in the case at bar...
     (T)he form is sufficiently analogous (to a blank form) in that it
     fails to convey information... Therefore, we also find plaintiff's
     form not copyrightable based on this doctrine.
     Id. pg. 120.
     There are a number of other drawbacks and limitations to copyright
protection.  For instance, if not properly perfected and registered a
copyright can be waived and the work may enter the public domain.  Also,
there are certain exceptions to copyright, such as exceptions based on the
mentioned "fair use" rule.  Computer Software,  2.07(4)(c) and
 2.08A(2)(c)(iii), L.J. Kutten, Clark Boardman (1990);  Dow Jones & Co. 
v.  Board of Trade of the City of Chicago, 546 F. Supp. 113 (S.D.N.Y.
1982);  Telerate Systems, Inc. v. Caro, 689 F.Supp. 221 (S.D.N.Y. 1988).
     Another drawback pertains to the deposit requirements of copyright
registration.  37 C.F.R.  202.20(C)(2)(vii).  Printouts of the program
source code and the database must be included with the registration.  For
long databases the registration requirement can be limited to the first and
last twenty-five pages.  If the program is IBM-PC or Apple Macintosh
compatible, and is recorded on CD-ROM, or diskette, then under the Best
Edition Statement supplement to the rules, you must submit both the
printout of the code and data and the software itself.
     A potentially serious problem with the deposit requirement is that the
print outs and software may be inspected or viewed by anyone upon request. 
Therefore if you have any trade secrets or other confidential information
contained in the printout of the source code (source code is usually kept
very secret) or database, or revealed in the operation of the software
itself, your competitor could gain access to them by inspecting or viewing
what you have deposited with the Copyright Office.  The Copyright Office
is sensitive to the danger of having trade secrets revealed in the deposit
accompanying copyright registration.  For this reason the Copyright Office
now allows selected portions of up to 49% of the printout of the computer
code to be marked out and hidden so that they cannot be read.  There are
limitations on this general rule in that the portions deleted cannot be so
great as to prevent the Copyright Office from intelligently reviewing the
registration.  
     Another practical problem with the deposit requirement is that some
databases are continually changing and being updated, and thus the deposits
and registrations must continue.  Although group registration on a
quarterly basis is now permitted by the Copyright Office in certain
circumstances to try and obviate this problem, several technical problems
with such periodic group registrations remain.   
     Another drawback in relying on copyright protection alone is that your
copyrights can be weakened or waived if proper copyright procedures are not
followed.  Such procedures include the proper fixation and display of
copyright notices and the registration of the copyright with the Copyright
Office.  The procedures and steps involved in registration of a computer
database copyright can be complicated and involved, particularly when trade
secret information is involved.  Computer Software,  2.08A(4),(5),(6),(8),
L.J. Kutten, Clark Boardman (1990).  For this reason it is suggested that
the assistance of competent computer law counsel be retained to assist in
this process.
     With copyright law providing only limited protection to databases, and
with all of the other problems inherent in copyright protection of a
database, contract and trade secret law become all the more important to
try and prevent the unauthorized copying of factual data in a database.
                        TRADE SECRECY PROTECTION
     Adding trade secrecy protection to a database can provide
significantly greater legal rights.  Consider for instance the recent case
of  Florida Power & Light  v.  Util. Services, 550 So.2d 13 (Fla. 3rd DCA
1989) where the jury found that the defendant FP&L had stolen the
plaintiff's trade secrets and awarded damages of $1.6 million.  Under civil
theft law, Chapter 812 Florida Statutes, this award was then trebled, for
a total judgment against FP&L of $4.8 million.
     Essentially a trade secret is knowledge which a person or company
acquires through its own efforts and which has some value to it. 
Typically, this knowledge is kept secret from competitors because it is
felt that this information provides some type of competitive advantage.
     There is a uniform Trade Secret Act which has been enacted in many of
the states of the country, including Florida.  Chapter 688, Florida
Statutes.  Section 688.002, Florida Statutes, defines a trade secret to
mean: 
          information, including a formula, pattern, compilation,
          program, device, method, technique or process that:
          (a) derives independent economic value, actual or
          potential, not being generally known to, not being
          readily ascertainable by proper means by, other persons who
          can obtain economic value from its disclosure or use; and 
          (b) is the subject of efforts that are reasonable under the
          circumstances to maintain its secrecy.
     The Uniform Trade Secret Act quoted above was adopted by Florida in
1988.  Trade secrecy protection has, however, long existed as part of the
common law.  Restatement of Torts, (1939) (1st Ed.),  757 "Liability For
Disclosure or Use of Another's Trade Secret";  Callman Unfair Comp.,
Trademarks & Monopolies, Ch. 14 (4th Ed.);  Kewanee Oil Co.  v.  Bicron
Corp., 416 U.S. 470, 94 S.Ct. 1879, 40 L.Ed.2d 315 (1974);  Cataphote Corp. 
v.  Hudson, 444 F.2d 1313 (5th Cir. 1971).  Since a computer database is
a compilation which derives economic value, it is a type of intellectual
property which has frequently received trade secrecy protection.  Whether
or not a court will find that a database is legally a trade secret
frequently depends upon whether the compiler made reasonable efforts to
maintain its secrecy.  Telerate Systems, Inc.  v.  Caro, 689 F.Supp. 221,
232 (S.D. N.Y. 1988) (Describes sufficient efforts taken to protect
computer trade secrets).  
     Many of the trade secret cases involve a dispute between an employer
and former employee over a common form of data compilation, a customer
list.  28 A.L.R.3rd 17 "Customer List As A Trade Secret".  Many employers
consider their customer list to be their most valuable trade secret, and
when an employee leaves and takes the list with him to compete against an
employer, a suit frequently follows to have an injunction entered to make
the employee return the list and not use those trade secrets.
     One such recent case is Unistar Corporation  v.  Child, 415 So.2d 733
(Fla. 3rd DCA 1982).  The employer here sold diamonds and gems through
"financial planners".  Over three years they had screened 12,000 known
planners and developed a list of 4,200 who were interested, and 1,850 who
had signed on as dealers.  Unistar spent over $800,000 to compile this
list!  Several Unistar employees left together and formed a competing
business using the lists which they took with them.  Unistar's sales then
fell 84%, from $440,000 to $70,000 per month.
     Unistar sued for an injunction, and the former employees defended by
claiming that the financial planners listed are all available to the public
and the lists were not trade secrets, and that there was no agreement that
the employees would keep the lists secret.  The court ruled for the
employer, Unistar, and found that the lists were trade secrets because:
     ... (they are) indeed the distillation of a larger list of financial
     planners, reflecting considerable effort, knowledge, time, and expense
     on the part of the plaintiff.  The customer lists were periodically
     updated and when the new list was provided the old list was destroyed. 
     The marketing representatives were instructed to keep the computer
     lists at their desks and not take them out of the office.  
     Id., pg. 734.
     The Court also held that even though there was no express contract
requiring non-disclosure of the trade secret, such an agreement was not
necessary, it would be implied based upon the confidential employer-
employee relationship between the parties.  Id. pg. 735.
     Conversely, other cases have held that if parties have a written
contract to treat certain information as a trade secret, and not to
disclose it, then even if the information does not legally qualify as a
trade secret, the parties can still be required to keep it secret. 
Concept, Inc.  v.  Thermotemp, Inc., 553 So.2d 1325 (Fla. 2nd DCA 1989).
But See: Kansas Gas & Electric v. Eye, 789 P.2d 1161 (Kan. 1990) (even
though contracts prohibited the disclosure of confidential information
concerning the safety record of a nuclear power plant, public policy
favored its free dissemination).
     Without such an agreement, however, the information in question must
legally qualify as a trade secret to be entitled to protection.  In one
case the court held that a customer list taken by an employee without a
written contract was not a trade secret and so refused to grant the
employer's request for an injunction.  Templeton  v.  Creative Loafing
Tampa, Inc., 552 So.2d 288 (Fla. 2nd DCA 1989).  
     The lists considered in the Creative Loafing case were of potential
and actual advertisers for the magazine employer.  The trial court found
that these lists were trade secrets, but the appellate court reversed
holding:
     In our view, the lists in question do not qualify as trade secrets
     entitled to injunctive protection.  There is no evidence that they are
     the product of any great expense or effort, that they are
     distillations of larger lists, or that they include information not
     available from public sources.
     Id. pg. 289.
The court also pointed out that the employee had testified that he had
independently compiled the list himself, and had not copied or taken it
from his employer.  Id. pg. 290.
     Outside of the employee/employer relationship, where a database is
licensed to others, it may still have and retain a trade secrecy status,
if it is sold with the condition that the licensee of the database maintain
the secrecy of the information.
                         PROTECTION BY CONTRACT
     A seller of the database can require that any purchaser enter into a
written contract as a condition of purchase of the database.  For example,
in order to try and circumvent Feist, the publisher of a computerized phone
book could refuse to sell or give the database to anyone unless they first
entered into a written agreement.  That written agreement could expressly
provide that the purchaser will not disclose the names and addresses
contained in the database to anyone but authorized users, nor make any
copies or unauthorized use of the information.  Typically this takes the
form of a License Agreement between the preparer/licensor of the database
and the user/licensee of the database.
     A License Agreement is unlike a typical purchase and sale agreement
in that ownership of the product involved, the computer program, remains
in the licensor.  The licensee merely purchases the right to use the
program.  The licensee's right to use the program can be limited in any
number of ways.  The most important limitations typically are that licensee
can only use the program on one or a select number of computers, the
licensee may not make any copies of the program, and the licensee has to
keep confidential certain information about the program or the database. 
Many other types of limitations or rights and reservations can be contained
within the license agreement between the parties.
                               CONCLUSION
     In any license of a computer database of significant value copyright
protection alone should not be relied upon to prohibit unauthorized
copying.  As the Feist case makes clear, copyright may not apply to protect
the data.  Trade secrecy protection and an express written agreement
between the vendor and consumer are necessary to try and protect the
database.  If as expected information continues to grow in value and
importance as a commodity in our society, then the proliferation of license
and secrecy agreements is likely.
                                THE END.
