Legal Commentary on the case of Founder VS P&G and Chinese Character, II

—Analysis on the law Nature of the Works of Word Stock

Today’s essay follows “Legal Commentary on the case of Founder VS P&G and Chinese Character, I”

(2) The Founder Word Stock is the composite works

The Stock here refers to the Founder Word Stock composing all the individual words in it rather than the stock software. The new works come from the selection or arrangement of the existing works is called the composite works. In our opinion, it’s necessary for Founder to apply the copyright registration for the whole Stock since only focusing on the determination of the copyrighted works over the Stock Software or the individual words is not enough. And such registration could benefit the protection over the Stock against any other infringement, such as to print a book or magazine in the script in the Stock with no license.

(3) The Stock Software could be the computer software works

In the case against Blizzard, Founder’s claim of infringement on its fine art works copyright was supported by the court while the claim of software infringement was not determined. We think the Stock is the fine art works,and in the case against Blizzard, the game World of Warcraft applies the Software instead of to copy it only. We think it could be concluded that the Software contains not only the “words” in it, but also the program codes. Then how could these codes be protected if only the words in the Stock are determined as the fine art works?

Actually, the Software takes no difference with other software. Take fine art in the online game as the example, to be copyrighted themselves does not influence to be part of the copyrighted online game.

II. The legal base of the implied license

According to the decision of the second instance, it’s judged that P&G’s using Software is under the implied license for the entrusted designing company Nice by P&G has purchased the Software. Basing on the analysis before, due to the subject of the purchase is the software, which is the computer software works, the reasonable application shall only limit to the software itself shall there were any implied license, while to adopt and widely use the brand in Stock’s script is neither legal nor reasonable. For instance, a film may contain the drama and music, with its copyright reserved by the producer; however that does not mean the producer is entitled to use the drama or music freely. And it’s the same for individual word and the Software, which using refers to different methods and objects and is independent to each other. The demonstration and analysis in the decision could not be supported by any legal base or precedent, and bases on wrong ground that the individual word has no copyright.

III. The determination on the compensation

As discussed above, the Stock could be prevented by the copyright law, any unlicensed using, either the individual word or the Stock, could be the infringement and the compensation is legally demanded.

But we think the losses hereby suffered shall be limited to a certain scope, for the Stock is not the core competence of the infringed products. In the World of Warcraft, the popularity is mainly due to its gameplay and high quality, and in other words, even the chat words are in other scripts the player could also be attracted. The same, the product reputation plays the main role in the decision to purchase the “飘柔”, rather than the script in which the brand is printed.

Therefore, the infringing party gains little benefit from it misconduct, and Founder only suffers the loss of expected profit, namely the license fee, which could not be equivalent to the claimed compensation of millions in the litigation. In our opinion, in the similar cases like the Stock, the Court shall limit the compensation in a reasonable amount by the copyright law once the copyrighter could not prove the actual losses it suffers.

The defects of vague definition and no identical standard in the practices of copyright law are revealed again in the Founder case. And we hope new interpretation could be promulgated soon to specify the copyright law in the new environment for the avoidance of the vexatious suits.

Author: Mr. Luo Yanjie
Attorney-at-law of DeBund Law Offices
Introduction on the Founder & Editor-in-Chief of Bridge IP Law Commentary:
Mr. You Yunting
Partner & Attorney-at-law of Shanghai DeBund Law Offices
Email:, Tel: 8621-5213-4900,
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