## Facts

- Gates Rubber Company developed “Design Flex 4.0,” a computer program used to select appropriate industrial machine belts by performing complex engineering calculations based on user-entered variables.
- Former Gates employees and related Bando entities participated in creating or using a competing belt-selection program.
- Gates alleged the competing program copied protectable elements of Design Flex 4.0 and misappropriated confidential technical information embedded in it, including certain mathematical constants and related data.
- Gates sued in federal court for copyright infringement and for trade secret misappropriation under Colorado law.
- After trial, the district court found defendants liable for copyright infringement and trade secret misappropriation.
- Defendants appealed, challenging the scope of copyright protection applied to the software and contesting the trade secret rulings, including a federal preemption argument.

## Issues

1. What analytical method and scope limits govern software copyright infringement determinations, and did the district court improperly treat unprotectable program elements as protected expression?
2. Are state-law trade secret misappropriation claims involving information contained in software preempted by the Copyright Act?
3. Did the evidence support that certain mathematical constants and related technical data qualified as trade secrets and that Gates took reasonable measures to keep them secret?

## Decision

- The Tenth Circuit vacated and remanded the copyright judgment, holding the district court extended protection to unprotectable program elements and did not adequately determine which copied elements were protectable.
- The court directed the district court to apply the abstraction–filtration–comparison method to separate protectable expression from unprotectable ideas, processes, facts, efficiency-driven elements, and externally constrained elements before comparing the programs.
- The Tenth Circuit affirmed the trade secret judgment, holding the trade secret claims were not preempted by federal copyright law.
- The court agreed the record supported that certain mathematical constants were valuable trade secrets and that Gates took adequate steps to maintain their confidentiality.

## Legal Principles

- Software copyright infringement analysis should proceed under an abstraction–filtration–comparison framework: (1) abstract program levels, (2) filter out unprotectable material (including ideas, methods, facts, public domain content, merged expression, efficiency-driven content, and constraint-driven elements), and (3) compare only remaining protectable expression for actionable copying.
- A court must identify protectable elements with specificity before finding substantial similarity in software cases; copying of unprotectable functional or constraint-driven elements does not establish infringement.
- State trade secret misappropriation claims are not preempted by the Copyright Act when they require an “extra element,” such as wrongful acquisition, breach of confidence, or misuse of confidential information, beyond mere reproduction of protected expression.
- Non-public technical data embedded in software, including certain mathematical constants, may constitute trade secrets if they derive value from secrecy and the owner takes reasonable measures to protect confidentiality.

## Conclusion

The Tenth Circuit required a disciplined abstraction–filtration–comparison analysis to determine protectable software expression and vacated the copyright liability finding for reconsideration, while affirming liability for trade secret misappropriation and rejecting Copyright Act preemption where the claim turned on misuse of confidential technical information.


Gates Rubber Co. v. Bando Chem. Indus., Ltd., 9 F.3d 823 (10th Cir. 1993)