Ninth Circuit Upholds Semiconductor Chip Protection Act Claim Asserting Protection for Logic Groupings

Image012Altera v. Clear Logic (9th Cir. 2005).

The Semiconductor Chip Protection Act of 1984 (SCPA) fills a perceived gap between copyright law and patent law and is intended to provide an incentive for investment in novel chip layouts (mask works).

The SCPA grants the owner of a mask work the exclusive rights to reproduce the mask work and to “import or distribute a semiconductor chip product in which the mask work is embodied.” 17 U.S.C. § 905.

Altera sued Clear Logic for violation of its SCPA rights and won a $30 million+ jury verdict. On appeal to the 9th Circuit, Clear Logic argued that the district court misinterpreted the SCPA.

Specifically, Clear Logic argued that its chips were only similar to Altera’s registered mask at a level of abstraction, and that only those ideas that are “physically expressed in the mask work are subject to protection under the SCPA.”

However, the 9th Circuit affirmed the district court’s application of the SCPA — finding that “groupings” shown in the mask (a level of abstraction) were “physically a part of the mask work.” As such, the groupings are protectable.

The placement of logic groupings in a mask work is not an abstract concept; it is embodied in the chip and affects the chip’s performance and efficiency as well as the chip’s timing.

In concurrence, Judge Rymer suggested that “this is the type of case in which it might have been useful to have a court-appointed, independent expert [to provide n]eutral definitions and a common understanding of the underlying technology.”