Software Copyright Infringement: Code, SaaS, and License Overruns

Last updated: November 2026

Software copyright infringement is the unauthorized reproduction, adaptation, or distribution of a computer program's protected expression: its source code, object code, and in some cases its structure and user interface. (17 U.S.C. §§ 101, 106, 501(a).) It does not reach the ideas or functions the program implements. (17 U.S.C. § 102(b).) The cases that reach us involve a departed developer's copied code, a cloned product, or a customer running more copies than its license allows. Kolmogorov Law, P.C. litigates software disputes for Orange County, Los Angeles, and other California businesses.

Call (909) 235-6116 or contact us online if your code has been copied or your company has been accused of copying.

What copyright protects in software

The Copyright Act defines a computer program as a set of statements or instructions used directly or indirectly in a computer to bring about a certain result. (17 U.S.C. § 101.) Programs are protected as literary works. (17 U.S.C. § 102(a).) The source code is protected, and so is the compiled object code. The protection extends to the original, non-functional choices a programmer made, which is why two programs that do the same thing can both be lawful while a program copied line for line is not.

The limit is in the same statute. Copyright never extends to any idea, procedure, process, system, or method of operation, however it is expressed. (17 U.S.C. § 102(b).) The algorithm, the feature set, the data model, and the business logic are ideas. A competitor may study your product and build the same functionality from scratch. What it may not do is take your code.

Courts filter out the unprotectable parts before comparing the works: elements dictated by efficiency, by external requirements such as hardware or industry standards, and by common programming practice. What remains is compared for substantial similarity, usually with an expert.

How copied source code disputes arise

A lead developer leaves and the competitor she joins ships a product four months later. The product's error messages, variable names, and bugs match yours. That is a copyright case, and almost always a trade secret case too, because the code was confidential. If she downloaded it on the way out, California's Penal Code section 502 supplies a civil remedy for unauthorized computer access that we pursue alongside it.

A software vendor audits a customer and finds it running three hundred seats on a hundred-seat license. The vendor calls it piracy. The customer calls it a billing dispute. Whether a license overrun is copyright infringement or only breach of contract depends on whether the limit was a condition of the license or merely a covenant. That distinction decides whether statutory damages and an injunction are available or only contract damages. Our guide to IP license disputes covers the contract side.

A contractor built the platform, was never asked to sign an assignment, and now claims the code. That is an ownership case, and we address it on our page on copyright ownership and contractors. Software is not among the categories that can be a work made for hire when created by a contractor, so a signed assignment is the only safe path. (17 U.S.C. §§ 101, 204(a).)

SaaS and cloud products

When software is delivered as a service, the customer never receives a copy, and the traditional license-overrun analysis changes. Scraping a SaaS product's output, reverse engineering its front end, or reselling access beyond the subscription terms is usually litigated as breach of the terms of service and, where code or interface elements were copied, as infringement. Open source components incorporated without complying with their licenses raise a separate infringement exposure.

What the owner of a copy may do

The statute gives the owner of a copy of a program the right to make another copy or adaptation as an essential step in using it with a machine, or for archival purposes. (17 U.S.C. § 117(a).) Licensees, who do not own their copies, generally must look to the license instead, which makes owner-versus-licensee a recurring battleground.

Remedies and procedure

A United States work must be registered, or registration refused, before suit. (17 U.S.C. § 411(a).) The Copyright Office permits registration of source code with portions redacted to protect trade secrets, which we handle before filing. Our page on registration before suit covers the timing.

If registration preceded the infringement or came within three months of publication, the owner may elect statutory damages of $750 to $30,000 per work, up to $150,000 if willful, and seek attorney fees. (17 U.S.C. §§ 412, 504(c), 505.) Otherwise the owner recovers actual damages and the infringer's profits, and the owner need only prove gross revenue before the burden shifts to the infringer to prove its deductions. (17 U.S.C. § 504(b).) See our page on statutory damages and fees.

Injunctions matter more in software cases than money. A preliminary injunction that takes a competing product off the market, or orders the departed developer's code quarantined, usually ends the case. Suits are filed in the Central District of California, in Santa Ana for Orange County businesses and in Los Angeles for Los Angeles businesses. The claim must be filed within three years after it accrued. (17 U.S.C. § 507(b).)

What we do

On the plaintiff side we lock down the evidence, secure the registration, retain the comparison expert, and move for an injunction. On the defense side we attack the registration, separate the ideas from the expression, prove independent development from version control history, and, in overrun cases, hold the vendor to the contract measure of damages. Our intellectual property litigation practice covers the related claims.

What to bring to the first meeting

Bring the repository with commit history, the registration if one exists, and every agreement with the developers who wrote the code. Bring the accused product, or what you can lawfully obtain of it, and the evidence that led you to suspect copying. If you are accused, bring your own development history and the license under which you used the software.

Frequently asked questions

Is copying source code copyright infringement?

Yes, if the code was protected expression and it was copied without authorization. Source and object code are protected as literary works. (17 U.S.C. §§ 101, 102(a).) The functions, algorithms, and methods the code implements are not protected, so independently writing code that does the same thing is not infringement. (17 U.S.C. § 102(b).)

Can I sue for software piracy if a customer exceeds its license?

Often, but not always. If the seat or usage limit is a condition of the license, use beyond it is unlicensed and infringing, with statutory damages available if the software was registered in time. If the limit is only a contract promise, the remedy is contract damages. The license language decides.

Who owns software written by a contractor?

The contractor, unless a signed writing assigns the copyright to the company. Software is not among the categories that can be a work made for hire by a contractor, so a work-for-hire clause alone is not enough. (17 U.S.C. §§ 101, 204(a).) Employees' code written within the scope of employment belongs to the employer. (17 U.S.C. § 201(b).)

Is it legal to reverse engineer software?

Studying a program to understand how it works is generally permitted when the person is a lawful owner or licensee and no license term forbids it. Many licenses forbid it, and copying code in the process can infringe. Copying only the unprotected ideas learned is not infringement. (17 U.S.C. § 102(b).)

How much are damages in a software copyright case?

Actual damages plus the infringer's profits, or statutory damages of $750 to $30,000 per work, up to $150,000 for willful infringement, if the software was registered before the infringement or within three months of publication. (17 U.S.C. §§ 412, 504.) Attorney fees may be added. (17 U.S.C. § 505.)

Talk to a California software copyright attorney

If your code has been copied or your business faces a software infringement claim, call (909) 235-6116 or contact us online. Kolmogorov Law, P.C. is at 327 Magnet, Irvine, CA 92618, and represents businesses in Orange County, Los Angeles, and throughout California. See also our trade secret and intellectual property litigation pages.

This page provides general information about federal copyright law and California law and is not legal advice. Outcomes depend on the code, the license, the registration, and the court.