Factual Background Edit
Plaintiff, Midway Manufacturing Co., manufactures video game machines. Inside these machines are printed circuit boards capable of causing images to appear on a screen and sounds to emanate from a speaker when an electric current is passed through them. On the outside of each machine is a screen, speaker, and a lever or button that allows a person using the machine to alter the images appearing on the machine's screen and the sounds emanating from its speaker. Each machine can produce a large number of related images and sounds. These sounds and images are stored on the machine's circuit boards. How the circuits are arranged and connected determines the set of sounds and images the machine is capable of making. When a person touches the control lever or button on the outside of the machine he sends a signal to the circuit boards inside the machine, which causes them to retrieve and display one of the sounds and images stored in them. Playing a video game involves manipulating the controls on the machine so that some of the images stored in the machine's circuitry appear on its screen and some of its sounds emanate from its speaker.
Defendant, Artic International Inc., sells printed circuit boards for use inside video game machines. One of the circuit boards Defendant sells speeds up the rate of play — how fast the sounds and images change — of “Galaxian,” one of Plaintiff's video games when inserted in place of one of the “Galaxian” machine's circuit boards. Another of Defendant's circuit boards stores a set of images and sounds almost identical to that stored in the circuit boards of Plaintiff's “Pac-Man” video game machine so that the video game people play on machines containing Defendant's circuit board looks and sounds virtually the same as Plaintiff's “Pac-Man” game.
Trial Court Proceedings Edit
Midway brought a copyright infringement action against Artic, alleging that Artic’s sale of two circuit boards that sped up rate of play of the copyrighted video games infringed their copyrights in the two video games, “Galaxian” and “Pac-Man.”
The trial court granted Midway’s motion for preliminary injunction and denied Artic’s motion for summary judgment. The trial court held that that the law did not require a work to be written down in the exact way that it is perceived by the human eye for it to be copyrightable. The court was also persuaded by Midway's demonstration that the images in the video games’ attract/demo modes repeated identically every time the video games were turned on. The court also held that the video games also repeated in similar ways during subsequent plays.
Appellate Court Proceedings Edit
The appellate court held that the video games are copyrightable as audiovisual works under the 1976 Copyright Act and that the Act applied to Midway’s video games. Further, the court stated that the speeded up video game using circuit boards supplied by Artic was a derivative work of the underlying copyrighted video game and thus, Artic’s sales of the circuit boards that sped up the rate of play on Midway’s video games was a copyright infringement.