MR. KOHN:  Thank you, Commissioner LEHMAN, for the opportunity to
testify  today. I'm Bob Kohn, Vice_President of Corporate Affairs
of Borland International, a leading  developer  and  marketer  of
desktop  and  client_server  computer  software including D_Base,
QuattroPro, Paradox, InterBase and Borland C++. I worked  in  the
entertainment  and computer software industries my entire career.
My experience in the software industry includes many types of ap-
plication,  utility  software for both mainframe and desktop com-
puters.  After a brief period of private practice and as  Associ-
ate  Editor of the Entertainment Law Reporter, I joined the legal
department of Ashton_Tate Corporation in 1983. Until its acquisi-
tion by Borland in 1991, Ashton_Tate was one of the world's larg-
est computer software companies.  In 1985 I left  Ashton_Tate  to
becomhsociate  General  Counsel to Kandell Corporation, a leading
supplier of IBM mainframe software, and in 1987 I joined  Borland
as General Counsel.

I want to emphasize that I am sensitive to the need for  the  in-
tellectual property protection on both a professional and person-
al level. My professional career is  focused  on  protecting  the
valuable  intellectual property assets of software companies. I'm
also an author myself, having recently written a  reference  book
on  music licensing that was published by Prentice_Hall.  To call
order 1_800_223_0231.  So I can certainly appreciate the need  to
protect  intellectual  property.   And I hope I've made my point.
If you need the number again I'll have it available.

COMMISSIONER LEHMAN:  Be careful, you know, works of  the  United
States Government are not copyrightable, so if you get your stuff
involved with ours you might have a problem.

MR. KOHN:  I'll try not to read my __ I'll try  not  to  read  my
book into the record.

I'm testifying today in my capacity  as  and
General Counsel of Borland, a publicly_traded Silicon Valley com-
pany. On behalf of Borland I  want  to  comment  specifically  on
Question  4  in the Hearing Notice, and if time permits more gen-
erally on questions regarding the scope of protection for  visual
aspects of software programs.

Question 4 asks whether the present framework  of  patent,  copy-
right,  trademark and trade secret law effectively promotes inno-
vation in the field of software. Like  all  other  software  com-
panies, Borland invests heavily in both the creation and acquisi-
tion of new software products, and like other  companies  Borland
needs strong government enforcement of existing intellectual pro-
perty rights, especially in foreign markets, in order to  protect
its investments.

But it is particularly unproductive at these hearings and at oth-
er  forms  for  public debate on these issues to hear two extreme
views espouse. One group, generally small companies, argue for no
protection  or  perhaps  at  best  very weak protection. A second
group, generalpery large companies, addresses the issue of  scope
rather  than  enforcement,  arguing  that  broader protection for
software is necessary, and indeed the broader the protection  the
better.   We believe that much of the polarization you have heard
and will hear is the result of a confusion of what is  being  de-

Protectionist interests in particular confuse enforcement of what
is  an undisputed intellectual property right with the underlying
scope of intellectual property protection. We in the industry all
understand that software as a product is particularly susceptible
to unauthorized duplication. We therefore need strong enforcement
of existing intellectual property rights to make sure that we are
protected against the pirating of our software.  But issues  con-
cerning  the enforcement of intellectual property rights must not
be confused with issues concerning the scope of intellectual pro-
perty  protection.  It is too easy to wrap oneself in the prover-
bial American flag of antipiracy and anticonterfeiting  entement.
There  is  no  dispute  that strong antipiracy enforcement is re-
quired to promote the resources necessary for research and  inno-
vation.   But  it does not follow that because strong enforcement
of intellectual property promotes innovation, a broader scope  of
intellectual property protection will also.

We should understand that many of those who very responsibly  ar-
gue for limitations on the scope of intellectual property protec-
tion are not trying to defend pirates. They are,  rather,  trying
to  make  a  medium  under which the proper scope of intellectual
property protection as established by Congress and the Courts  is
respected  and  strongly enforced by the Administrative Branch of

This distinction between the enforcement of existing rights and a
broadening of the underlying scope of protection was recently ad-
dressed at the 1993  Berkeley  Roundtable  on  the  International
Economy  in  which the Vice_President, the Commerce Secretary and
the Commissioner all participated.

The Report of  the  Roundtab......xn  Maintaining  Leadership  in
Software  states  the  distinction  between enforcement and scope
very clearly. I'll include a block quote in my written  testimony
which  begins with the following sentence:  "Industry representa-
tives argue that the importance of protecting  intellectual  pro-
perty  from  theft  by commercial counterfeiters and unscrupulous
users must be distinguished from  issues  concerning  the  proper
scope of intellectual property protection."

Unfortunately Question 4 in the  Hearing  Notice,  in  our  view,
heightens  rather than diminishes the confusion and polarization.
Question 4 seems to be based on a premise that strong  protection
for  existing  intellectual property rights necessarily implies a
greater scope of intellectual property  protection,  and  further
that  a  greater scope of intellectual property implies a greater
amount of innovation.

Implicitly, Question 4 neglects the important role that  competi-
tion  plays in encouraging innovation. We believe that the impli-
cation inherent in Question 4 should |he subject of much  greater
scrutiny  and  analysis.  Within the industry we all, or at least
most of us, agree that greater enforcement of  intellectual  pro-
perty  is necessary.  What has fractionalized the industry is the
attempt by some to use the need for greater  enforcement  to  at-
tempt  to  expand  the  scope of underlying intellectual property
rights, particularly within the copyright area.  As  the  Commis-
sioner  is  aware,  just  two weeks ago the head of the Antitrust
Division of the Department of Justice, Assistant Attorney General
Ann Binghamen gave a major speech on the occasion of the sixtieth
anniversary of the founding of the Antitrust Division.   The  As-
sistant  Attorney  General recognized the polarization within the
industry that has been caused by attempts to increase  the  scope
of intellectual property protection.

She said, "The substantive reach of the exclusive rights  granted
under  the  intellectual  property laws also has been a matter of
particular concern and ferment  in  the  software  industry.  The
Cournd  the  agencies  have  been  faced with difficult decisions
about the scope of both patents and copyrights in this field,  as
is  clear  to anyone who has paid attention to the long series of
important court decisions on computer  software  copyrights,  in-
cluding  Whelan, Altai, and the recent decisions in Lotus v. Bor-
land, now under review in the 1st Circuit.  The  scope  of  copy-
right  protection  for computer software has we believe important
competitive implications as well as  important  implications  for
the incentives to innovate."

We are particularly heartened to hear Assistant Attorney  General
most  eloquently state her concern about attempts to increase the
underlying scope  of  intellectual  property  protection.  Again,
please  permit me to quote what she had to say.  "Given my strong
belief in competition, I think the courts should be  hesitant  to
read  the  statutory  grant  provisions  expansively,  but should
recognize the anticompetitive potential of restrictive  practices
at or beyond the borders of clearly_conveyed utory rights."

While the Assistant Attorney General was directly addressing only
the  courts, we believe the same cautions should apply to the Ad-
ministrative Branch of government as well.

Many questions to be addressed at these hearings  deal  with  the
visual  aspects  of  computer  screen displays. In evaluating the
proper scope for protection for the individual aspects of comput-
er  programs,  we  believe  that  the Patent and Trademark Office
would do well to consider the analytical  framework  employed  by
the  engineers  and computer scientists as opposed to the lawyers
and judges in the software industry.

As the Commissioner is aware, much of the  original  and  seminal
work  in graphical user interface analysis and design was done at
Xerox Corporation in the 1970s. The research at  Xerox  formed  a
wealth  of  user interfaces far beyond just those of Xerox's pro-
ducts.  Apple's MacIntosh and Lisa, Hewlett_Packard's  New  Wave,
Microsoft's  Windows,  X_Windows, IBM's Office Vision and OS/2 to
name just a few.  Much of thearch at Xerox was published in scho-
larly  papers  for distribution both inside and outside of Xerox.
The most famous of those papers, entitled "A Methodology for User
Interface  Design,"  was  published  by  Xerox Palo Alto Research
Center in January of 1977.  Because of the enormous importance of
this  paper, I'm going to attach it to Borland's written comments
and ask that you consider it as part of these proceedings.

The Xerox research produced a  methodology  of  interface  design
that  is  based  upon what Xerox researchers called a taxonomy or
classification for user  interface  analysis.  This  taxonomy  is
designed to permit analysis and evaluation of what each aspect or
component of a user interface does.  The taxonomy was created for
software  analysis  and not for any legal purpose, but remarkably
it dovetailed seamlessly with the overall  intellectual  property
scheme  of  patents,  copyrights and trade secrets established by

As the Xerox research concluded, every user interface  has  three
separable  compo.s;  one,  the  user's conceptual model; two, the
control mechanism or  command  invocation  of  the  product;  and
three,  the  visuals, or the information display. The user's con-
ceptual  model  is  the  abstraction  selected  by  the  software
developer  which  users can relate to the task they are trying to

For example, the spreadsheet metaphor  is  the  conceptual  model
that  underlies  Borland's QuattroPro line of products. Under our
intellectual property scheme, the conceptual model of a  particu-
lar  piece  of software would not be protectable at all except of
course insofar as it may be protected by trade  secret  or  under
the terms of a contract or confidential relationship. The command
invocation or control mechanism of  the  user  interface  is  the
mechanism   that   extracts  the  functionality  built  into  the
software. It is a set of actions and results defined in  particu-
lar  relationships to one another.  Menu items and keystrokes are
part of the control mechanism and were clearly identified as such
by  the  Xerox  research puhed in the mid_seventies.  Indeed, the
control component was originally called the command language.

Under the intellectual property scheme established  by  Congress,
the  control  mechanism  of the software product falls within the
ambit of patent law, specifically utility patents.  In  order  to
secure utility patent protection over a control mechanism, an in-
ventor should be required to satisfy the  statutory  requirements
of novelty, advancement over the prior art and so forth.  For ex-
ample, if the user entered a database by first  clicking  on  the
picture  of  the  door to simulate knocking, and then clicking on
the picture of the door_knob to simulate turning it, the sequence
of  steps would be part of the control mechanism and must satisfy
the rigors of patent examination if it is to  be  protected.   If
the  command mechanism does not meet the rigors of patent protec-
tion, it should not be protected by any other form of intellectu-
al property protection such as copyright.

Finally, in Xerox's terminology, there are p....ams  of  visuals.
The  screen displays of many sophisticated user interfaces have a
truly separable visual or expressive component. Images  that  can
be manipulated through animation techniques.

The Congressional scheme provides for protection of  these  visu-
als,  and under both statute and the case law, the visual display
of the computer program may be protected by copyright law if  and
only  to  the  extent  its  artistic  features  can be identified
separately from and are capable of existing independently of  the
utilitarian aspects of the software program. Note that the defin-
ition of computer program under copyright law is a set of  state-
ments  or instructions to be used directly in a computer in order
to bring about a certain result. The screen display is a  certain
result of the set of statements or instructions that comprise the
underlying computer  program  and  must  therefore  independently
qualify as a work of authorship.

Those are my two paragraphs. Thank you for the opportunity to ap-
pear here today and I would b...ppy to answer your questions.

COMMISSIONER LEHMAN:  Thank you very much, Mr. Kohn. I just  note
you  refer  to  Question  4  in our Federal Register Notice which
states that __ which asks the question, Does the  present  frame-
work  of  patent,  copyright and trade secret law, A, effectively
promote innovation in the field of software, and, B, provide  the
appropriate  level of protection for software_related inventions.
I don't read those as implying that we should raise the level  of
protection;  in  fact  I read those as an open_ended question as,
What is the appropriate level? and that may well be a lower  lev-
el.   It  may be no level at all, and I think the questions we've
asked would suggest that we do have an open mind about that.

MR. KOHN:  I'm glad to hear that the Commission has an open  mind
about  these issues. I think that, looking at the background sec-
tion of the hearings, I don't have it in front of me, specifical-
ly emphasizes the innovation that's promoted by protecting intel-
lectual property, and the point th made is that  there  is  abso-
lutely  no  reference whatsoever to the importance of competition
in promoting innovation, and you mentioned earlier, to an earlier
witness, that __ you suggest that the competition issues might be
more appropriately addressed under Antitrust provisions,  but  it
is  an intellectual property issue, and that's precisely what Ann
Binghamen had said in her speech.  It is an intellectual property
program,  we are after all talking about government_granted mono-

COMMISSIONER LEHMAN:  Thank you very much. I'd  like  to  take  a
five_minute  recess  before  we  reconvene  for  the  rest of the
morning's hearings, and our next witness, when we come back  will
be, I believe, Douglas Brotz from Adobe Systems.


COMMISSIONER LEHMAN:  Next I'd like to call Douglas K. Brotz  who
is  the  Principal Scientist of Adobe Systems, Incorporated right
here in the Valley.

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