Amicus Curiae Brief — Southern Building Code Congress International, Inc. v. Veeck

(D

7 | Supreme Court, U.S.

No. 02-355 Sati

OCT 21 2

In the Supreme Court of the United States

CLERK

SOUTHERN BUILDING CODE CONGRESS INTERNATIONAL, INC.,

Petitioner,

v.

PETER VEECK d/b/a REGIONAL WEB,

| Respondent.

On Petition for a Writ of Certiorari to the

United States Court of Appeals for the Fifth Circuit

BRIEF FOR THE AMERICAN SOCIETY OF MECHANI-

CAL ENGINEERS, THE NATIONAL BOARD OF BOILER

AND PRESSURE VESSELINSPECTORS, AND AMERICAN

CONCRETE INSTITUTE, AMICI CURIAE,

SUPPORTING PETITIONER

Epwarp A. Matto Goria C. PHARES

ELIZABETH H. WATTS Counsel of Record

Bricker & Eckler LLP SHAWN V. MorEHEAD

100 South Third Street Patterson, Belknap, Webb

Columbus, OH 43215 & Tyler LLP

(614) 227-2300 1133 Avenue of the Americas

New York, NY 10036

(212) 336-2000

RICHARD A. GAFFIN

THOMAS C. PHILLIPS

Miller, Canfield, Paddock STEVEN C. CHAREN

& Stone, P.L.C. 562 Hudson Street

99 Monroe Avenue, N.W. New York, NY 10014

Suite 1200 (212) 243-1027

Grand Rapids, MI 49503

(616) 454-8656

Attorneys for Amici Curiae

TABLE OF CONTENTS

Page

See FI i 5 eb ha i cee iss ll

Interest of the Amici Curiae ...............0.4.. ]

woe er en eee te re 1

2. COMYTIGMLTOVOMURE . ow... ccc cece cs estes 5

3. The creation of voluntary

COMBOMOUS GTUEOTGD . ww 5c occ isenccssecas 6

4. Wide availability of amici curiae’s

EN NG SI ig 5 ve ee hc ence’ seed 7

5. Widespread public and private

use of codes and standards .............. 8

Reasons for Granting the Petition .............. 10

I. The Fifth Circuit’s Decision

Jeopardizes Public Safety ............... 10

II. The Fifth Circuit’s Decision Ignores the

Purpose and Plain Language of the Copyright

Act, Creates a Split Among the Circuits, and

Would Lead to Non-Uniform Standards

I vans thee hee eee 12

A. The Fifth Circuit’s Decision Ignores

the Purpose and Plain Language

OF The Corrie At. . ww cece 12

il

Contents

Page

B. The Fifth Circuit’s Decision

Creates a Conflict Among

ee CI, nn ak oe a 15

C. The Fifth Circuit’s Decision Will Lead

to A Lack of Uniform Standards,

Interfering With Interstate Commerce. .. 18

COmSIION 2540+ b0s03d4iee eee 20

TABLE OFAUTHORITIES

Cases:

Banks v. Manchester, 128 U.S. 244 (1888) ....... 15, 16

Building Officials & Code Administrators

v. Code Technology, Inc.,

GIB F2e THO Cia CM. TOG) ks co ceensewessons 15

CCC Information Services, Inc. v. Maclean Hunter

Market Reports, Inc., 44 F.3d 61 (2d Cir. 1994) .. 15,17

Hart v. Dan Chase Taxidermy Supply Co.,

O6 F.36 S20 (26 Ce. 1G bai os vs ct eiv atin, 17

Kregos v. Associated Press,

O37 FOG Tee Cae Gee BOP v5 casa dee uk ends 17

Mazer v. Stein, 347 U.S. 201 (1954) ............ 13

ill

Authorities

Page

Practice Management Information Corp.

v. American Medical Ass’n, 121 F.3d 516,

amended on other grounds, 133 F.3d 1140

Se ee ee 16, 17

United States v. Security Industrial Bank,

Co es 15

United States Constitution:

6 I aS i. 15

ee eS ee ee 12

Statutes and Rules:

National Technology Transfer and Advancement

Act of 1995, Pub. L. No. 104-113,

ke S| re 18

Se rr 12

eS Mae | rn 14

yo er l

ES rn ]

iv

Authorities

Page

Legislative and Executive Materials:

H.R. Rep. No. 104-390 (1996) reprinted in

i get a oe RO errs Sere 12

OMB Circular No. A-119, 63 Fed. Reg. 8545

| PRR re Tere oer eee 18

Other Authorities:

MELVILLE B. NIMMER & DavipD NIMMER,

NIMMER ON CopyRIGHT (1996) ..............-. 17

WILBUR Cross, THE CoDE: AN AUTHORIZED

HIsTORY OF THE ASME BolLer AND

PRESSURE VESSEL CoDE (1990) .............. 1, 2, 19

l

The American Society of Mechanical Engineers, The

National Board of Boiler and Pressure Vessel Inspectors, and

the American Concrete Institute submit this brief as amici curiae

in support of the Southern Building Code Congress International,

Inc.’s petition for a writ of certiorari. The parties to the action

have given their written consent to the filing of this brief pursuant

to Rule 37(2)(a) of the Rules of this Court. The letters of consent

have been filed with the Clerk.’

INTEREST OF THE AMICI CURIAE

1. Amici curiae. Although different in some respects,

The American Society of Mechanical Engineers (“ASME”),

The National Board of Boiler and Pressure Vessel Inspectors

(‘National Board”), and the American Concrete Institute (“ACT”)

are all not-for-profit organizations whose members volunteer

to produce design, construction, and inspection codes. By

adopting these codes into regulations and laws, the individual

states and federal government have effectively endorsed the

voluntary consensus standards developed by these organizations

as the most effective way to create uniform standards in design,

construction, and inspection that protect the American public

and enhance interstate commerce.

a. On March 2, 1854, a boiler exploded at the Fales and

Gray Car Works in Hartford, Connecticut. Destroying the boiler

room and the adjoining blacksmith shop and shattering the main

building, the explosion killed 21 people and injured more than

50 others. The coroner’s jury that investigated the explosion

concluded that regulations should be devised to require the

regular safety inspection of boilers and to prevent the careless

or inexperienced operation of boilers. Despite this devastating

accident, the jury’s recommendations went unheeded and boiler

explosions continued.” In 1911, in response to the continuing

1. Pursuant to Supreme Court Rule 37.6, amici curiae state that

this brief was written, produced, and funded exclusively by amici

curiae or their counsel.

2. Witspur Cross, THE Cope: AN AUTHORIZED HISTORY OF THE

ASME BOoILer AND PrEssurRE VESSEL Cope 23, 29 (1990).

2

loss of life and property and to the need for standardization

across political jurisdictions, ASME appointed a committee to

write the organization’s first Boiler Code. After almost four years

of drafting, revision, and discussion, ASME published the first

Boiler Code in 1915.’

ASME is a not-for-profit scientific, educational and

technical organization for mechanical engineering, which was

founded in 1880. It is a membership organization with over

125,000 individual members internationally. It has no corporate

members. ASME serves several important functions, one of

which is the development and maintenance of voluntary codes

and standards associated with the art, science and practice of

mechanical engineering.

ASME promulgates and publishes approximately 600 codes

and standards addressing a broad range of topics related to

mechanical engineering. ASME codes and standards include

the Boiler and Pressure Vessel Code, the Elevator and Escalator

Code, standards relating to turbines, cranes and pipelines,

performance test codes, and standards as mundane as size

dimensions for nuts and bolts, which enable interchangeability.‘

In addition, ASME operates related conformity assessment

programs.

More than 100 principal standards committees operate

within ASME, as well as hundreds more subcommittees, task

groups and other sub-tier groups, with 3,600 volunteer

participants and a full time codes and standards staff of nearly

100. Maintenance of ASME’s standards is an ongoing process,

requiring the consideration of new and advanced technologies

and the enhancement of public health and safety. Over 1,000

committee and sub-tier group meetings are held each year as

part of the extensive process of maintaining and updating

ASME’s codes and standards. It has been estimated that the

3. Id. at 35-42.

4. All of these codes and standards are “voluntary consensus

standards” described infra, at pp. 6-7. For purposes of this brief only,

the terms “codes” and “standards” are used interchangeably.

3

members donate approximately $26 million of their time each

year to drafting, revising and maintaining ASME’s codes and

standards.

The Boiler and Pressure Vessel Code (“BPVC”) is ASME’s

most widely used code. The BPVC addresses components and

new construction of pressure retaining equipment, including

boilers, so that such equipment can be operated safely without

undue danger of explosion. It sets specifications for heating

boilers in places of public assembly, such as hospitals, schools

and churches, as well as in multiple dwellings, and for pressure

equipment in any kind of facility, from electric power generation

plants, including nuclear plants, to chemical and oil refineries,

to naval ships, to dry cleaning stores. The BPVC now consists

of eleven specialized sections, further subdivided into 28

specialized volumes, with the most recent version being over

17,600 pages long. More than 950 individual professionals

participate in maintaining the BPVC, including metallurgists,

designers, manufacturers, insurance inspectors, users such as

the power and petroleum industry, and independent consultants.

In addition, 55 representatives of state and local governments,

including members of amicus the National Board, participate

in maintaining the BPVC. ASME has registered its copyrights

in the BPVC and in all of its other 594 codes and standards.

b. The National Board was created in 1919 to promote

greater safety for life and property through uniformity in the

construction, installation and inspection of boilers and pressure

vessels. Its membership comprises the Chief Boiler Inspectors

of the 49 states, 12 Canadian provinces, and several

municipalities that have adopted ASME’s BPVC or other codes

or standards acceptable to the National Board as a regulatory

requirement. In addition to participating in the maintenance of

ASME’s BPVC, the National Board commissions and qualifies

Authorized Inspectors (employed by governmental enforcement

authorities, insurance companies, and owner/user inspection

organizations), and it administers the process of third-party

inspection of boilers and pressure vessels during the construction

4

process. In 1921, the National Board began registering all

pressure vessels and boilers approved by an Authorized Inspector

commissioned by the National Board. In the fiscal year 2001,

the National Board registered 123,132 boilers, 1,177,598

pressure vessels, and 1,849 nuclear-power related components.

The National Board also publishes model boiler laws, rules

and regulations such as NB-131 (entitled “Recommended Boiler

and Pressure Vessel Safety Legislation”) and NB-132 (entitled

“Recommended Administrative Boiler and Pressure Vessel

Safety Rules and Regulations”). The National Board Inspection

Code (“NBIC”) is a standard recognized worldwide for in-

service inspection, repairs and alterations of boilers and pressure

vessels. Twenty-six experts and members of the National Board

provide input into the various codes that it creates and maintains.

The National Board has registered copyrights for all of its codes.

c. ACI is a non-profit scientific and educational society

organized in 1904 to represent the user interest in the concrete

field. ACI has over 16,000 individual members. ACI supports

over 100 technical committees, which currently produce more

than 400 technical documents, reports, guides, specifications,

and codes related to concrete technology and its applications.

The committee members give approximately $10 million

of volunteer time each year to drafting, revising, and maintaining

ACI’s technical documents, including codes. All of ACI’s

technical documents are reviewed at least every five years and

are revised and reissued when necessary. ACI publishes and

maintains four consensus documents: (1) ACI 318, Building

Code Requirements for Structural Concrete, which governs the

design and construction of structural concrete in buildings and

is the source document for all United States concrete

construction; (2) ACI 349, Code Requirements for Nuclear

Safety Related Concrete Structures, which is referenced by

licenses issued by the Federal Nuclear Regulatory Commission;

(3) ACI 350, Code Requirements for Environmental

Engineering Concrete Structures, which applies to the design

and construction of concrete structures in the water

— —

5

infrastructure, such as potable water tanks and water treatment

facilities; and (4) ACI 530, Building Code Requirements for

Masonry Structures, which governs the design and construction

of concrete and clay masonry buildings. The Committee

overseeing the 318 Code has 76 members, including architects,

engineers and academics who spend approximately 8,572

person-hours annually developing the Code, or about $2 million

of volunteer time. In addition, ACI administers a national

training and certification program for concrete technicians,

inspectors, and workers. ACI has registered its copyrights for

all its documents, including its codes.

Although each of the amici curiae operates independently,

some of their activities are interrelated when they set standards

relating to different aspects of the same equipment. ASME, for

example, focuses on the original design, manufacture, and

construction of boilers and pressure vessels, while the National

Board standards apply to installation, maintenance, and repair

of the same equipment. National Board members serve on

ASME code committees representing their jurisdictions’

interests, and National Board staff employees also serve on

ASME code committees representing general interests. ASME

and ACI have jointly developed those portions of the BPVC

relating to the design and construction of concrete reactor vessels

and containments used in nuclear power plants.

2. Copyright revenues. Despite the extensive voluntary

participation by experts in developing ASME’s, ACI’s, and

the National Board’s codes, these private, not-for-profit

organizations incur significant expenses in connection with code

development. These expenses are covered by revenue derived

to a large extent from ASME’s, ACI’s and the National Board’s

publication and sale of these codes and standards. In the fiscal

year ending June 30, 2001, the sale of ASME’s copyrighted

codes and standards generated one-third of ASME’s total

revenues. ACI’s 318 Code generated ten percent of ACI’s total

revenues in 2001; all ACI codes and standards were responsible

for one-third of ACI’s total revenues. The National Board

6

likewise derives a significant portion of its revenue from the

sale of its codes and standards. This revenue allows the National

Board to continue to offer its extensive training program

involving continuing education in various disciplines of the

boiler and pressure vessel industry, to operate a pressure relief

device testing laboratory and to maintain detailed records of all

National Board registered boilers and pressure vessels. Absent

the revenue generated by the publication of their codes and

standards, the not-for-profit ASME, ACI and the National Board

would be unable to support the drafting and maintenance of

these uniform, expert codes. Their membership fees and other

sources of revenue alone could not support the process.

3. The creation of voluntary consensus standards.

ASME’s codes and standards, the National Board’s NBIC, and

ACT’s codes are all voluntary consensus standards. ASME, ACI

and the National Board develop these codes through a consensus

process by committees composed of several different interest

groups — a process accredited by the American National

Standards Institute.°

Three principles govern the creation and maintenance of

voluntary consensus standards: openness, lack of dominance,

and due process. Drafting and maintenance of the standards are

open; any person who is directly and materially affected by a

voluntary consensus standard may participate. To ensure that

no single interest group dominates the drafting and maintenance

of voluntary consensus standards, each organization has

devised guidelines that require balance among the interested

constituencies. For example, ASME prohibits any interest

category (e.g., manufacturer, designer/constructor, owner/

operator, jurisdiction/enforcement agency) from constituting

5. The American National Standards Institute is a private,

non-profit organization that administers and coordinates the

U.S. voluntary consensus standards system. The Institute’s mission is to

enhance both the global competitiveness of U.S. business and the U.S.

quality of life by promoting and facilitating voluntary consensus

standards systems, and safeguarding their integrity.

7

more than one-third of a committee dealing with safety. Finally,

to provide due process, any person with a direct and material

interest in a standard has a right to have his or her position

considered by the committee during a period of public comment

and has the right to appeal the committee’s determination.

4. Wide availability of amici curiae’s codes and

standards. Once a new version or revision of ASME’s,

the National Board’s, or ACI’s codes has been finalized through

these voluntary consensus procedures, ASME, ACI or the

National Board publishes and sells the new version or revision.

For example, a new version of ASME’s entire BPVC, now

28 volumes, is published every three years, and ASME

distributes updates annually. A company or practicing

professional working in a specialized area covered by the BPVC

may obtain a copy of the applicable volumes, as well as ASME’s

other codes and standards, in any of several ways. ASME

distributes a catalog of its publications annually and publishes

information about its codes and standards or its website at

www.asme.org. Users of the BPVC may order a copy of pertinent

volumes or the entire BPVC, in print or electronic format, by

writing to ASME, calling a toll-free number, or sending a fax or

e-mail. In jurisdictions where ASME is aware that the BPVC

has been adopted by reference, ASME provides a complimentary

copy of the BPVC to the relevant government entity. It is also

generally available in university engineering libraries. Virtually

no company or practicing professional uses the entire BPVC;

for example, those not involved with nuclear facilities have no

need for any of the eleven volumes relating to such facilities

and those involved solely with unfired pressure vessels have no

need for volumes relating to power or heating boilers.

Recognizing that most users do not need the entire BPVC,

ASME sells copies of separate specialized volumes of the

BPVC, ranging in cost from $155 to $410. Other ASME codes

and standards are similarly readily available to the specialized

professional audiences that use them.

8

The NBIC and other National Board codes and

regulations are sold at reasonable prices to anyone, but are

purchased primarily by those in the industry. A print copy of

the NBIC is available for $85, and a CD-ROM version is

also available at a higher cost. Public access to these codes

has been provided successfully in this way since 1919.

Information relevant to the codes, updates, and supporting

documents are available at the National Board website which

is found at www.nationalboard.org. The National Board

distributes approximately 10,000 copies of its codes each year.

Since 1956, major revisions of ACI’s code documents have

typically been completed every six years. ACI makes its codes

available in both print and electronic formats, which can be

purchased in technical and university bookstores as well as

directly from ACI at its website, www.concrete.org. The 2002

version of ACI’s Building Code Requirements for Structural

Concrete comprises 443 pages and is available directly

from ACI for $141.50 for non-members. ACI distributes

approximately 12,000 copies of its codes each year.

5. Widespread public and private use of codes and

standards. ASME’s, ACI’s, and the National Board’s codes and

standards are written for the benefit of many entities beyond

their membership — some public, some private. The codes

and standards developed by ASME, ACI, and the National Board

are followed widely, in part because of the significant

contributions of the many experts who work to maintain them

and because of the voluntary consensus procedures they employ.

Insurance companies rely on the past safety records of equipment

built to standards in writing insurance, resulting in lower

premiums, which benefit insureds. Manufacturers use the codes

and standards to develop and market standardized, safe products

6. Reliance on the codes and standards is not confined only to the

United States. ASME’s BPVC is accepted in 80 countries worldwide.

The National Board’s NBIC is recognized worldwide and is indeed the

only standard of its type with such recognition. ACI’s 318 Code serves

as the basis for building codes in several other countries.

9

that can be shipped into and used in all jurisdictions without

the increased costs of modifying equipment to meet varying

requirements.’ Institutions that operate boilers and pressure

vessels rely on the NBIC in connection with their maintenance,

repair, and alteration. Concrete design, construction, and repair

and maintenance professionals throughout the United States rely

on ACI code requirements.

In addition to these private sector users, many government

entities have chosen to take advantage of these expertly

developed codes and standards. United States government

agencies reference 89 ASME standards in the Code of Federal

Regulations.’ State and local governments also have adopted

multiple ASME standards; for example, the New York

Department of State references 54 ASME standards. The BPVC

has been adopted, in whole or in part, as a regulatory requirement

by 49 states and all Canadian provinces, is widely used by

multiple agencies of the U.S. government, is accepted in more

than 80 countries, and is used by manufacturers accredited under

ASME ’s related conformity assessment program in 65 countries.

7. The BPVC fosters interstate and international commerce because

all U.S. and Canadian jurisdictions adopting the BPVC agree to accept

equipment certified to have been built in compliance with it. In addition,

30 years ago ASME opened its BPVC conformity assessment program

to manufacturers outside of North America and currently accredits

manufacturers in 65 countries as being capable of producing equipment

or components in compliance with specific BPVC sections.

8. Federal agencies and departments as varied as the Architectural

and Transportation Barriers Compliance Board, the Department of

Defense, the Department of Energy, the Department of Housing and

Urban Development, the Department of the Interior, the Department of

Transportation, the Environmental Protection Agency, the Mine Safety

and Health Administration, the Nuclear Regulatory Commission, the

National Aeronautics and Space Administration, the Occupational Health

and Safety Administration, the U.S. Coast Guard, the U.S. General

Services Administration, and the U.S. Postal Service reference ASME

_ Standards in their regulations and procurement procedures.

10

The NBIC is accepted in all 50 United States and all the

Provinces of Canada, and by the U.S. Department of

Transportation, which regulates, among other things, over-the-

road pressure vessels that carry compressed gases on interstate

highways. The laws of several states contain references to codes

created by the National Board: many state accreditation

programs require NBIC accreditation in order to implement

repairs on nuclear plants; at least 35 states and two cities have

laws with requirements for repair of safety relief devices; and

at least 34 states and two cities have requirements for the repair

of boilers and pressure vessels.

ACI’s 318 and 530 Codes are adopted by reference

by the state, county, and city building codes of all 50 states.

All nuclear power facilities must have a license approved by

the Federal Nuclear Regulatory Commission. These licenses

reference ACI’s 349 Code for the design and construction of

safety-related concrete structures.

The private and government entities that use ASME’s,

ACI’s, and the National Board’s codes and standards benefit

from the expertise that goes into developing them and from

their widespread acceptance. The Fifth Circuit’s decision

threatens the near century of private and public cooperation that

has fostered the development of these codes and standards and

advanced public safety in commerce unhindered by jurisdictional

barriers. Without these uniform codes and standards, all of these

entities would face the same intolerable chaos boiler

manufacturers faced before 1915.

REASONS FOR GRANTING THE PETITION

I. The Fifth Circuit’s Decision Jeopardizes Public Safety

The Fifth Circuit’s decision, if allowed to stand, would

jeopardize the safety of people who live, work, and play in

buildings constructed with concrete or that contain boilers or

pressure vessels — namely the entire public. Over the last

century, private entities such as ASME, ACI, and the National

Board, and public entities have cooperated to develop and

implement codes and standards that promote safety and

11

streamline commerce. This system of code development and

implementation has been sustained by the revenue derived from

the authors’ copyrights.

The Fifth Circuit’s decision would deprive private

non-profit entities such as ASME, ACI, and the National Board

of the copyright of any code or standard when it is adopted by

any governmental entity. It would thus permit unlimited third-

party publication, including free worldwide distribution on the

Internet. As a result, the code and standards-setting organizations

would lose the revenue earned from sales of copies of those

codes. The revenues generated by these endangered copyrights

cover the expenses incurred in developing and maintaining

these codes. Without those revenues, these not-for-profit codes

and standards-writing organizations would no longer be able to

develop and maintain their codes and standards.

Absent the eiforts of private code-drafting organizations,

the federal government, states, and municipalities would be

faced with the daunting task of developing their own codes and

standards for boilers, pressure vessels, concrete structures, as

well as numerous other items. Although these governmental

entities may have an adequate incentive to produce these codes

—namely the obligation to ensure the safety of their constituents

— they would be unable to deploy the same extensive resources

as organizations created by experts in the field for this purpose,

such as ASME, ACI, and the National Board. Private code-

drafting organizations whose codes are widely followed are able

to spread the costs of code development among users throughout

the world; individual jurisdictions may not be able to share costs

so efficiently. Nor would individual jurisdictions be able to

collect the breadth of expert input achieved by private national

entities. Moreover, codes developed by political bodies are likely

to be subject to lobbying efforts of interested parties. They are

less likely to have the benefits of the voluntary consensus

procedures followed by ASME, the National Board, and ACI,

which are specifically designed to provide the best technical

solutions without dominance by any one interested party.

12

The end result would likely be a multitude of local codes

and standards that are devised with less expert care and with

more attempts by interested parties to enact codes that benefit

their private interests rather than the public at large. As the House

Report on the National Technology Transfer and Advancement

Act recognized, “[t]his unique consensus-based voluntary

system has served us well for over a century and has contributed

significantly to United States competitiveness, health, public

welfare and safety.” H.R. Rep. No. 104-390, at 24 (1996)

reprinted in 1996 U.S.C.C.A.N. 493, 510. The Fifth Circuit’s

decision stands poised to undo these significant contributions

to public welfare and safety by depriving voluntary consensus

standard-writing organizations of the economic incentive for

drafting codes and standards — their copyright revenues.

II. The Fifth Circuit’s Decision Ignores the Purpose and

Plain Language of the Copyright Act, Creates a Split

Among the Circuits, and Would Lead to Non-Uniform

Standards Nationwide.

A. The Fifth Circuit’s Decision Ignores the Purpose

and Plain Language of the Copyright Act.

The Copyright Act encourages the creativity of authors by

granting them an economic incentive in the form of a copyright

for a limited period of time. See 17 U.S.C. § 106 (1994).

No one disputes that ASME, ACI, the National Board and similar

organizations acquire copyrights in their codes and standards;

these organizations are authors of the original expression

enibodied in their codes and standards and are entitled to the

lawful monopoly created by the Copyright Act in furtherance

of the goal of the Constitution’s Copyright Clause. U.S. Const.

art. I, § 8, cl. 8.

The revenues generated by ASME’s, ACI’s and the National

Board’s publication of their copyrighted codes and standards

provide these not-for-profit organizations the economic support

to create and maintain their codes and standards. The revenues

generated by ASME’s copyrights constitute one-third of ASME’s

total annual revenues. Likewise, revenue generated from the

13

sale of the National Board’s NBIC is significant and fundamental

to its operations. ACI’s copyrights are the basis for one-third of

ACTI’s total annual revenues. The Copyright Clause of the

Constitution and the Copyright Act were adopted to create

precisely this result. “The economic philosophy behind the

clause empowering Congress to grant patents and copyrights is

the conviction that encouragement of individual effort by

personal gain is the best way to advance public welfare through

the talents of authors and inventors. . . .” Mazer v. Stein, 347

US. 201, 219 (1954). ASME’s, ACI’s, and the National Board’s

copyrights encourage the creative work of these organizations

and thereby advance public welfare, just as the Copyright Clause

envisioned.

The Fifth Circuit’s decision would strip petitioner and other

code-writing organizations such as ASME, ACI, and the National

Board of the copyrights in their codes and standards. Under the

Fifth Circuit’s holding, when the federal government, a state,

or municipality adopts into its laws or regulations a private,

non-profit entity’s codes or standards, that entity would lose its

copyrights in those referenced codes and standards; the codes

and standards would enter the public domain. Pet. App. 14a.

Because ASME’s, ACI’s or the National Board’s codes are

incorporated by reference in federal regulations and in the

statutes of all the states, the Fifth Circuit’s ruling threatens their

copyrights. As a result of the loss of income from their

copyrights, ASME, ACI, the National Board and similar

organizations would be forced to discontinue their code drafting

and maintenance. The economic incentive created by the

Copyright Act would no longer be available to them as a result

of governmental adoption and the Fifth Circuit’s decision.

The Fifth Circuit states that because codes and standards

are developed so that they may be used by governments, the

private, non-profit code writing organizations that develop them

are not entitled to their copyrights. Pet. App. 25a. This statement

is doubly flawed. First, codes and standards are not written solely

for adoption by government entities. They are also intended

14

for use by the private sector to facilitate uniform design,

construction, and inspection.

Second, although many standards-setting organizations

promote the adoption of their codes by government entities,

they do not thereby authorize governmental expropriation of

their copyrights. Indeed, in some instances, jurisdictions

reference privately authored codes without securing permission

from, or even notifying, the code author.? And ACI’s 318 Code

is normally not adopted by a government’s direct reference to

the 318 Code, but rather because the 318 Code is referenced in

a privately drafted model building code (such as petitioner’s

building code) that is in turn referenced by a government.

The Fifth Circuit’s ruling dismisses the Copyright Act’s

plain language that

When an individual author’s ownership of a

copyright, or of any of the exclusive rights under a

copyright, has not previously been transferred

voluntarily by that individual author, no action by

any governmental body or other official or

organization purporting to seize, expropriate,

transfer, or exercise rights of ownership with respect

to the copyright, or any of the exclusive rights under

a copyright, shall be given effect under this title,

except as provided under [the Bankruptcy Act].

17 U.S.C. § 201(e) (1994) (emphasis added); Pet. App. 21a.

None of the amici curiae has ever voluntarily transferred the

copyrights or any of the exclusive copyright rights in

their codes or standards. Thus, the plain language of the statute

itself directly forbids the kind of expropriation of copyright —

loss of copyrights by governmental adoption — that the Fifth

Circuit’s ruling endorses.

9. Florida referenced the 1996 version of ASME’s Elevator and

Escalator Code, even though a 2000 version was available. ASME

learned of the Florida’s reference only by observing the steady stream

of sales of the 1996 version to Floridians.

15

Finally, the Fifth Circuit also failed to consider the

constitutional limits on government expropriation established

by the Takings Clause. U.S. Const. amend. V, cl. 5. If a

governmental entity’s adoption by reference of a privately

written code results in the loss of the author’s copyright, as the

Fifth Circuit has concluded, it unquestionably results in a

“taking” of the property rights granted by the Copyright Act to

the code author. See CCC Info. Serv., Inc. v. Maclean Hunter

Mkt. Reports, Inc., 44 F.3d 61, 74 (2d Cir. 1994) (“For example,

a rule that the adoption of such a reference by a state legislature

or administrative body deprived the copyright owner of its

property would raise very substantial problems under the Takings

Clause of the Constitution.”). This constitutional issue could

have been avoided had the Fifth Circuit ascertained whether it

was “fairly possible,” as it surely is, to construe the Copyright

Act so as to avoid a taking. United States v. Security Indus.

Bank, 459 U.S. 70, 78 (1982).

B. The Fifth Circuit’s Decision Creates a Conflict

Among the Circuits.

The Fifth Circuit’s decision to deprive private code-drafting

entities of their copyrights upon reference by a government entity

conflicts directly with decisions of the Second and Ninth

Circuits, which confirmed the rights of private entities such as

ASME, ACI, and the National Board to maintain and enforce

their copyrights."

The en banc majority of the Fifth Circuit disregarded the

Copyright Act’s purpose of creating an incentive for authors in

the form of a copyright in their work. Claiming to rely on Banks

v, Manchester, 128 U.S. 244 (1888), the en banc majority held

that even where a private entity authors a code, once the code is

10. In Building Officials & Code Adm. v. Code Technology, Inc.,

628 F.2d 730, 735 (1st Cir. 1980), on which the Fifth Circuit also relied,

the court explained that it could not say with “any confidence that the

same policies applicable to statutes and judicial opinions may not apply

to” privately authored codes. However, the court explicitly refused to

make a final ruling on the issue at the preliminary injunction stage.

Id. at 736.

16

adopted in federal, state, or local statutes or regulations, the

privately authored code becomes “the law” and loses its

copyright. Pet. App. 15a. But Banks recognized the importance

of incentives to copyright. This Court, in holding that “no

copyright could, under the statutes passed by congress, be

secured in the products of the labor done by judicial officers in

the discharge of their duties,” relied on the fact that judges are

paid from the public treasury and therefore “have no pecuniary

interest ... in the fruits of their judicial labors.”

Id. at 253; see also Practice Mgmt. Info. Corp. v. Am. Med.

Ass'n, 121 F.3d 516, 518, amended on other grounds, 133 F.3d

1140 (9th Cir. 1998) (noting that Banks rests in part on the

ground that the public owns judicial opinions because the public

pays the judges’ salaries). The en banc majority of the Fifth

Circuit gave no weight to this factual distinction between Banks

and this case — that private, non-profit entities such as amici,

unlike the publicly paid judges in Banks, do have a pecuniary

interest in the codes and standards they create.

The en banc majority of the Fifth Circuit instead focused

on language in Banks that suggested that judicial opinions should

be “free for publication to all.” Pet. App. 9a-1la. Reading a

right to freely access and copy the law — without cost — into

this language, the en banc majority found that references to

privately authored codes were inconsistent with this right if the

privately authored codes retained their copyrights. Therefore,

the court held that such codes enter the public domain when

they are referenced by governmental entities. Pet. App. 14a.

The Ninth and Second Circuits have not embraced the Fifth

Circuit’s reading of Banks. In Practice Management, 121 F.3d

at 518, the Ninth Circuit considered the Physician’s Current

Procedural Terminology (“CPT”), a coding system for medical

procedures created by the American Medical Association.

In 1977, the federal Health Care Financing Administration

(“HCFA”) adopted regulations requiring applicants for Medicaid

reimbursement to use the CPT. The plaintiff in Practice

Management argued that, under Banks, the CPT entered the

17

public domain when HCFA required its use by regulation.

The district court and the Ninth Circuit disagreed and held that

federal adoption of the CPT did not result in forfeiture of the

copyright because such a result would “‘prove destructive of

the copyright interest,’ in encouraging creativity.” Jd. (quoting

1 MELVILLE B. NimMeR & Davip NimMer, NIMMER ON COPYRIGHT

§ 5.06[C], at 5-92 (1996) (“NimMeER”)). The Ninth Circuit also

noted that there was “no evidence that anyone wishing to use

the CPT has any difficulty obtaining access to it.” Jd. at 519.

The Second Circuit in CCC Information Services similarly

declined to hold that a book of automobile valuations was

stripped of its copyright when several states required insurance

companies to use the valuations to determine minimum

payments for the “total loss” of a vehicle. 44 F.3d at 74. Like

the Ninth Circuit, the Second Circuit reasoned that such a loss

of copyright would be “antithetical to the interests sought to be

advanced by the Copyright Act.” Jd. (citing NimMER § 5.06[C]

at 5-60).!’ The Fifth Circuit, by ignoring the Copyright Act’s

purpose of creating an economic incentive for authors, contrary

to the decisions of the Second and Ninth Circuits, has created

chaos in the law.

The Fifth Circuit’s decision has also led to uncertainty in

the law by creating a right to freely access and copy the law

without cost. Access to the law has never before been construed

to mean access without cost. Just as there is no evidence that

cost prevented respondent from gaining access to the SBCCI

code at issue in the instant case, cost does not prevent anyene

from gaining access to ASME’s, ACT’s, or the National Board’s

codes and standards. ASME’s, ACI’s and the National Board’s

11. Further compounding the split among the courts of appeals is

the fact that these courts do not all analyze the merger doctrine, one of

respondent’s copyright defenses, the way the Fifth Circuit did below.

Compare the Fifth Circuit’s approach, Pet. App. 16a-20a (treating merger

as part of the analysis of copyrightability), with Hart v. Dan Chase

Taxidermy Supply Co., 86 F.3d 320, 322 (2d Cir. 1996), CCC Info. Serv.,

44 F.3d at 72 n.26, and Kregos v. Assoc. Press, 937 F.3d 700, 705

(2d Cir. 1991) (treating merger as part of the analysis of infringement).

18

codes are widely available for purchase on their websites, by

telephone and by mail. They are also available for reading and

copying at technical and university engineering libraries and

government offices. Although not articulated, respondent is not

really complaining that he was deprived of the ability to gain

access to and use SBCCI’s Building Code. Indeed the record

shows that he had no difficulty buying a copy from SBCCI for

himself. Instead, he is claiming the right to compete with SBCCI

as a publisher of the code by posting it on his website.

C. The Fifth Circuit’s Decision Will Lead to A

Lack of Uniform Standards, Interfering With

Interstate Commerce.

Congress has directed federal agencies and departments to

use voluntary consensus standards such as those created by

amici. See National Technology Transfer and Advancement Act

of 1995, Pub. L. No. 104-113 § 12(d), 110 Stat. 775, 782 (1996)

(noted in Historical and Statutory Notes, 15 U.S.C.A. § 272

(West 1997)). Following that directive, the Office of

Management and Budget pointed out that voluntary consensus

standards “[e]ncourage long-term growth for U.S. enterprises

and promote efficiency and economic competition through

harmonization of standards.” OMB Circular No. A-119, 63 Fed.

Reg. 8545, 8554 (revised 1998), available at www. whitehouse.

gov/omb/circulars/al 19/a119.html."”? The decision of the en banc

majority of the Fifth Circuit, if allowed to stand, will undermine

the efficiency of interstate commerce, the benefits to public

welfare created by these harmonized codes, and the codes and

standards-writing organizations, such as amici, whose efforts

have fostered those benefits.

: Without national organizations such as ASME, ACI, and

the National Board to promulgate and maintain codes and

12. The OMB circular expressly directs federal agencies:

“If a voluntary standard is used and published in an agency document,

your agency must observe and protect the rights of the copyright holder

and any other similar obligations.” 63 Fed. Reg. 8545, 8555 (revised

1998).

19

standards, the federal government, states, and localities will be

forced to create and update their own codes and standards

for, among other things, the construction and maintenance

of boilers, pressure vessels, concrete structures, and myriad

other equipment such as elevators and escalators. Because each

governmental entity will be forced to create its own codes, the

codes could vary from state to state, county to county, and even

town to town.

A Maryland manufacturer making a component for an

electrical power generation plant that meets Maryland

specifications could not be sure that the same component would

comply with the specifications adopted by neighboring Virginia

without further inspection, let alone know whether it would

comply with the codes of the other 48 states. An architect in

Anna, Texas might have to learn a different code for concrete

structures if he or she wanted to design a structure to be built

just a few miles away in Savoy. Similarly, a concrete column,

slab, or beam that satisfied the strength requirements in

California might be deemed inadequate in Arizona. And the

lack of uniform standards would leave the insurance industry

without benchmarks upon which to base premiums. But the Fifth

Circuit decision would nonetheless deprive codes and standards

writing organizations of copyright revenues necessary to

continue their valuable work.

The inability to conduct business across jurisdictions was

one of the primary reasons for the creation of the Boiler Code

almost a century ago. As the introduction to the final 1914 drafts

of ASME’s first Boiler Code recognized, inconsistent laws and

regulations of boilers from one area to another made interstate

shipment of parts at that time almost impossible, creating

“intolerable confusion.” '? Today manufacturers are able to

design and manufacture products that conform with the BPVC

and ship them to all 50 United States, Canada, and more than

80 other countries where the BPVC is accepted. Because

insurance companies know the performance records of

13. Cross, supra note 2 at 41.

PME nice cence emia oe er ee Mrceetnenenre ns ae Penn DOE He en

a aa

20

equipment manufactured according to code and inspected by

authorized inspectors, they can better assess the likelihood of

loss and decrease the cost of insurance. Because of the wide

adoption of ACI’s 318 Code, architects and designers of concrete

structures are able to design in many jurisdictions without

studying multiple standards. The Fifth Circuit’s decision not

only creates chaos on an important issue of law by initiating a

split among the circuits, it also would create chaos in industry

and commerce by thwarting the efficiency and economic

competition that the system of harmonized codes has created

throughout the last century.

CONCLUSION

Amici urge this Court to grant petitioner’s petition for a

writ of certiorari and reverse the judgment below.

Respectfully submitted,

Epwarp A. Matto GLorIA C. PHARES

ELIZABETH H. Watts Counsel of Record

Bricker & Eckler LLP SHAWN V. MoREHEAD

100 South Third Street Patterson, Belknap, Webb

Columbus, OH 43215 & Tyler LLP

(614) 227-2300 1133 Avenue of the Americas

New York, NY 10036

RICHARD A. GAFFIN (212) 336-2000

THOMAS C. PHILLIPS

Miller, Canfield, Paddock STEVEN C. CHAREN

& Stone, P.L.C. 562 Hudson Street

99 Monroe Avenue, N.W. New York, NY 10014

Suite 1200 (212) 243-1027

Grand Rapids, MI 49503

(616) 454-8656

Attorneys for Amici Curiae

OctToBER 2002

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