Federal copyright law is the most important legal protection for computer software. The 1976 Copyright Act generally gives the owner of software the exclusive right to use it and to authorize others to reproduce it. Basic copyright protection attaches upon creation, but important legal protections under the law require registration of the copyright with the U.S. Copyright Office of the Library of Congress. Unfortunately, by failing to register, companies often fail to take full advantage of the rights and protections afforded copyrights.

There are very important reasons to register a copyright. First, registration is required to bring a copyright infringement suit. A copyright owner cannot proceed with a copyright infringement lawsuit unless the software has been registered. A company could wait to register when it uncovers a competitor infringing its copyright, but this will lead to delaying the lawsuit and increasing expenses.

The second reason a company should register copyrighted software in a timely manner is that the company will be eligible to receive “statutory damages” and “legal costs and attorneys’ fees” from a copyright infringer. A timely manner means that the copyright registration was filed prior to an infringement taking place or within three months from the publication date of the software. If the infringement occurs prior to the effective date of copyright registration or after the three-month grace period then the company will not be entitled to receive statutory damages and legal costs and attorneys’ fees. The effective date of copyright registration is the date when the Copyright Office receives the complete registration application that consists of the application, fee and deposit copies.

The significance of statutory damages is that it permits an award of special damages in a successful infringement lawsuit and negates the duty of the company to prove actual damages. The reasons why a company may elect to receive statutory damages rather than actual damages is that in many instances proving actual damages is very difficult or the profits of the infringer are very small. The statutory damages that will be awarded are discretionary and will depend upon how willful and harmful the infringement was ­ usually the more deliberate and more damaging the infringement the greater the award. Furthermore, the legal costs in any copyright infringement lawsuit, particularly attorneys’ fees, are extremely expensive. By registering the software in a timely manner the court also has the discretion to award attorneys’ fees and legal costs to the company.

The third reason why a company should register copyrighted software is that the Certificate of Registration serves as prima facie evidence that the software is original and is owned by the registrant of the copyrighted work. This becomes especially important if it becomes necessary for the company to obtain a preliminary injunction against a copyright infringer, such as the immediate cessation of the distribution of the infringer’s work. The presumption of validity will only apply if the software has been registered within five years from the publication date.

In actuality the benefits received from registering copyrighted software may be even more important than those resulting from a copyright infringement lawsuit. This is because the great majority of copyright infringement matters are settled by the parties and not resolved by a lawsuit. The primary reason why copyright infringement actions are settled is the significant cost in time and money that is involved in such lawsuits. By registering copyrighted software in a timely manner the company has the ability to bring the lawsuit at the specific moment it is advantageous. It also permits the company to send a “cease and desist letter” to the infringer that incorporates demands that are backed-up by the knowledge that a lawsuit could be immediately filed and that the (i) validity of originality and ownership will be presumed, (ii) statutory damages may be awarded, and (iii) legal costs and attorneys’ fees may be recovered. When a copyright infringer receives such a cease and desist letter they will be more likely to accede to the company’s demands without the company actually initiating a lawsuit.