## Facts

- Creative Labs manufactured Sound Blaster sound cards, a leading product in the PC sound card market.
- Cyrix designed the MediaGX microprocessor, which integrated audio capability (XpressAUDIO) intended to function without a separate sound card.
- Cyrix advertised XpressAUDIO as “compatible with Sound Blaster” and “fully compatible with Sound Blaster.”
- Tiger Direct marketed MediaGX-based computers as having “integrated SoundBlaster 16/Pro compatible audio.”
- Creative tested 200 computer games on a MediaGX-based system and reported that 16 games (8%) did not run properly; Creative also reported missing support for ADPCM and MIDI functions supported by Sound Blaster.
- Cyrix disputed the extent of incompatibility, citing a lower failure rate and contending that MIDI capability existed but was disabled in a particular configuration.
- Creative also discovered Cyrix had copied Creative software and posted it on Cyrix’s website in a manner that enabled and encouraged public downloading and copying.
- Creative sued for false advertising and dilution under the Lanham Act and for copyright infringement, obtaining a TRO and then seeking a preliminary injunction.

## Issues

1. Whether “compatible” and “fully compatible” claims about MediaGX/XpressAUDIO and related systems were false or misleading under Lanham Act § 43(a).
2. How “compatible” should be interpreted in computer hardware marketing: mere operability versus functional interchangeability without material performance or capability differences.
3. Whether Cyrix’s copying and web posting of Creative software, and facilitating third-party copying, likely constituted copyright infringement.
4. Whether the requirements for preliminary injunctive relief were satisfied (likelihood of success, irreparable harm, balance of hardships, and public interest).

## Decision

- The court granted a preliminary injunction against Cyrix and Tiger Direct on the false advertising claim.
- The court adopted a strict definition of hardware “compatibility”: the product must be usable as a substitute “without producing any difference in performance” and must have the same capabilities and functions.
- Applying that definition, the court found Creative was likely to succeed because some software that worked with Sound Blaster did not work properly with MediaGX and because MediaGX lacked at least one Sound Blaster-supported function.
- The court granted a preliminary injunction against Cyrix on the copyright claim based on evidence that Cyrix copied and posted Creative software online and facilitated public copying.
- The court denied Creative’s ex parte request for an order to show cause regarding contempt.

## Legal Principles

- In computer hardware advertising, “compatible with” may be construed to mean functional interchangeability: a drop-in substitute with no performance differences and the same capabilities and functions.
- A “compatible” claim that fails this interchangeability standard can constitute a false or misleading representation under Lanham Act § 43(a).
- Likely diversion of sales and harm to goodwill from false compatibility claims can support preliminary injunctive relief, along with the public interest in truthful technical advertising.
- Unauthorized reproduction and distribution of copyrighted software by posting it online, particularly where the poster encourages or enables third-party copying, supports a finding of likely copyright infringement and may be enjoined preliminarily.

## Conclusion

The court preliminarily enjoined Cyrix and Tiger Direct from making “Sound Blaster compatible” advertising claims that implied full functional interchangeability and enjoined Cyrix from distributing Creative’s copyrighted software online, finding Creative likely to succeed on both claims and that injunctive relief served consumer protection and market fairness.


Creative Labs, Inc. v. Cyrix Corp., 42 U.S.P.Q.2d 1872 (N.D. Cal. 1997)