No full-text available
To read the full-text of this research,
you can request a copy directly from the authors.
Expropriation or Fair Game for All? The Gradual Dismantling of the IP Exclusivity Paradigm
Abstract
“Intellectual property“ has become the international household term denoting the rights addressed in Part II of the TRIPS Agreement. The term suggests that such rights grant their proprietor an entitlement to exclude others from using the protected subject matter. However, in reality, intellectual property has never been exclusive in a strict sense. Copyright, in particular, is relatively rich with examples of rules allowing third parties to use protected content under certain conditions, and against payment of a fair remuneration. In economic terms, this means that property is replaced by a liability rule. After explaining the basic tenets of property vs. liability rules and commenting on the factors informing the choice between the two types of rules, the article gives an overview on liability rules which can be found, or are under discussion, in the various fields of intellectual property. It is argued that although liability rules may pose specific concerns with regard to administration and efficiency, their fundamental rejection as regulatory model would have no rational basis. “Intellectual property” is a term of convenience rather than enunciating a truth cast in stone, and the practical relevance of liability rules is likely to increase in view of challenges by novel forms mass uses of protected content, and by growing sophistication of technology.
... 7 See also M.-C. Janssens (2009), 347, emphasizing that the balancing mechanism between exclusive rights and exceptions "is ingrained in the copyright system and is of paramount importance for its legitimacy and credibility" (emphasis added). 8 C. Geiger (2004) view of the copyright system, it seems strange to differentiate between exploitation rights and copyright limitations, because both have the same goal. ...
In order to enable future creativity, some uses are traditionally kept outside the control of the right owner through limitations to the exclusive right. Uses covered by a limitation can lead to an obligation to pay a fair remuneration to the creator. In these cases, these “limitation-based remuneration rights” are often called “statutory licenses”. As these remunerations can provide significant revenues for creators, they constitute interesting tools for legislators in order to avoid the blocking effect of exclusivity, while at the same time ensuring that the creator can participate fairly in the creative reuse of their works. However, this option has so far been given relatively little consideration in the context of derivative works. This chapter is intended to fill that gap, exploring whether statutory licenses can offer a satisfying mechanism to enable and incentivize creative uses of copyrighted works.
... Admittedly, this is a different model from that of mainstream intellectual property. However, it is perhaps analogous to the suggestion that intellectual property might shift its focus from property to liability rules (Kur, 2011). In any event, mainstream intellectual property is no stranger to the changing of boundaries. ...
This article is about how geographical indications (GIs) cannot deliver the protection for traditional knowledge that indigenous peoples seek. There are three broad ways in which the protection of GIs appears to offer the possibility of providing legal mechanisms to protect traditional knowledge. These are the collective nature of the protection, the indefinite availability of GIs and the connection that GI owners associate between their products and their land. Those seeking protection of traditional knowledge also seek a collective and an indefinite interest and frequently the relationship between their knowledge and the land is important for indigenous peoples. Yet these similarities are superficial. GIs protect names and are used by western farmers and sometimes rural communities to promote their products. This article concludes that GIs cannot deliver the protection that indigenous peoples seek in order to benefit from their traditional knowledge.
This Chapter distinguishes three open approaches to innovation: The Market Correction Model, the Open Innovation Theory, and User and Open Collaborative Innovation and reviews how they explain the motivations behind giving voluntary access to intellectual property. What qualifies as “openness” differs dramatically between the three theories. On this basis, the open models and the licensing practices they represent are placed on a continuum that ranges from restricted to indiscriminate access. The impact on innovation and competition of each level of openness is analysed. Mechanisms that are based on indiscriminate licensing, such as patent pledges, patent pools, and open viral patenting, are evaluated in more detail concerning their legal foundations, legal bindingness, and incentives to employ them. The chapter identifies the scope of incentives to engage in open licensing and arrives at the conclusion of them being insufficient to resolve all the market failures that hinder follow-on innovation.
The chapter reviews the conditions for compulsory licenses for functional efficiency set in international law and the instruments’ adequacy to address the market failures that hinder follow-on innovation. Under the TRIPS Agreement, compulsory licenses (Art. 31) are a mechanism distinct from exceptions to patent protection (Art. 30). Of the general and procedural conditions of Art. 31 TRIPS, the requirement of prior effort to obtain a license before using a patent largely precludes the application of compulsory licenses to hold-up problems. Otherwise, TRIPS features considerable, albeit underused, procedural flexibilities for the application process of a compulsory license. Compulsory licenses for dependent patents (Art. 31 (l) TRIPS) have too narrow a scope of application to sustain the interests of follow-on innovators adequately. In theory, the market failures resulting from the deliberate conduct of a patent holder could be addressed on the grounds of abuse of rights. However, the instrument is toothless due to the requirement of prior effort. Essentially, only compulsory licenses that aim at remedying an anti-competitive practice are liberated from the condition of preliminary effort to obtain a license and could address the broadest range of market failures that hinder follow-on innovation.
This article clarifies the concept of remuneration rights and examines remuneration rights in EU copyright law. Specifically, the article examines the criteria for the calculation of remuneration under the different remuneration rights in copyright law and evaluates how they conform to the normative methodology based on Calabresi and Melamed’s distinction between property rules and liability rules. In the EU copyright acquis, in some cases remuneration reflects the market value of the use of the work, whereas in others it reflects the harm inflicted on the rightholder through use of the work. In spite of overlaps between harm and market value when used as the basis for the calculation of remuneration, the two criteria are fundamentally different. In yet other cases, remuneration is not closely tied to either market value or harm but is a means for the redistribution of surplus. The article concludes that a harm-based remuneration right is a young cuckoo bird in the nest of copyright law and that the calculation of remuneration ought always to be based on market value, unless the purpose of the right is to pursue specific policy objectives by redistribution of surplus. The article recommends that courts, de sententia ferenda, exploit the overlap between harm and market value and shift the focus of interpretation towards the latter.
Nowadays, the main purpose of a patent law system is predominantly, while balancing private and public interests, to govern economic decisions, to encourage innovation and, in general, to reach economic efficiency. On the one hand, the question is, therefore, whether the current German patent law system (including German and European antitrust laws), as it is currently applied, and the future system under the regulation on the European Patent with Unitary Effect, as it is designed, contain too many exclusive elements to be efficient. On the other hand, because the choice between the two options may not be purely economic, it must also be investigated whether other factors could be taken into account or—more importantly for an analysis that focuses on the economic effects of the patent system—make it necessary to use either exclusive or non-exclusive elements. Two additional perspectives may be relevant: distributional preferences and other justice considerations. Although these two categories and economic efficiency may not be strictly distinguished from each other, the additional perspectives should be understood here as limitations on economic efficiency. Also, due to the present focus on a concrete legal system, at least shortsighted legal reasons (i.e., higher-ranking law and multilateral contracts) may play a role.
The primary purpose of a patent law system should be to enhance economic efficiency, in particular by providing incentives for making inventions. The conventional wisdom is that patents should therefore be strictly exclusive rights. Moreover, in practice patent owners are almost never forced to give up their right to exclude others and receive only a certain amount of remuneration with, for instance, compulsory licensing. Other economically interesting patent-law objectives, however, include the transfer and dissemination of knowledge. Mechanisms exist by which the patent owner decides if he or she would prefer exclusive or non-exclusive rights, for instance theopportunity to declare the willingness to license and create patent pools. But it is questionable whether these mechanisms are sufficient and efficient enough in view of the existence of patent trolls and other problems. This work challenges the conventional wisdom to a certain extent and makes proposals for improvements.
Automated knowledge discovery tools have become central to the scientific enterprise in a growing number of fields and are widely employed in the humanities as well. New scientific methods, and the evolution of entirely new fields of scientific inquiry, have emerged from the integration of digital technologies into scientific research processes that ingest vast amounts of published data and literature. The Article demonstrates that intellectual property laws have not kept pace with these phenomena.
Copyright law and science co-existed for much of their respective histories, with a benign tradition of the former giving way to the needs of the latter. Today, however, the formidable array of legislative maneuvers to tighten the grip of copyright laws in defense of cultural industries whose business models were upended in the online environment have, deliberately or not, undermined the ability of the scientific community to access, use, and reuse vast amounts of basic knowledge inputs. Database protection laws, reinforced by electronic fences and contracts of adhesion, further subject copy-reliant technologies to the whims of publishers and hinder the pooling of publicly funded resources that empower collaborative research networks and the formation of science commons in general.
The authors analyze the different components of a complicated transnational legislative fabric that have changed world copyright law into a science-hostile environment. Given the global nature of digital scientific research, they focus attention on comparative laws that fragment research inputs into diversely accessible territorial compartments. This analysis shows that users of automated knowledge discovery tools will likely become collective infringers of both domestic and international property laws.
In response to this challenge, the authors discuss possible solutions to the problems that intellectual property laws have created for digitally integrated scientific research from two very different angles. First, the authors skeptically consider the kinds of legal reforms that would be needed if commercial publishers continued to act as intermediaries between producers and users of scientific information and data, as they do today, without regard to the likelihood that such reforms would ever be enacted.
The authors then reconsider the role of publishers and ask whether, from a cost-benefit perspective, it should be significantly modified or abandoned altogether. Finally, the authors examine alternative strategies that the scientific community itself could embrace in a concerted effort to manage its own upstream knowledge assets in ways that might avoid, or at least attenuate, the obstacles to digitally empowered scientific research currently flowing from a flawed intellectual property regime. The Article concludes by stressing the need to bridge the current disconnect between private rights and public science, in the overall interest of both innovation and the advancement of knowledge.
At a time when the European Commission is finally beginning to consider the necessity of adapting copyright limitations to the requirements of the information society,1 courts are being increasingly forced to propose liberal interpretations of existing regulations in order to permit the development of a true knowledge economy and to make up for a number of legislative deficits in the field of copyright. This is also true of the Swiss Supreme Court, which in a recent decision put forward a very bold interpretation of the private use limitation in order to facilitate the provision of electronic press reviews to enterprises by specialised commercial services. 2 On this occasion, the Swiss Supreme Court put forward a particularly innovatory approach on copyright limitations and a radically new reading of the Three-Step Test. This decision, which can be seen as visionary in that it calls into question established principles, deserves elucidation.
While the European Parliament has just overwhelmingly rejected the directive proposal on the patentability of computer-implemented inventions, the subject will remain very controversial, particularly due to the fact that the European Patent Office will probably maintain its practice of granting patents on software matters. Therefore, a large number of questions are still pending and it thus becomes even more urgent to keep a certain distance from the present debate. This article asks in a general manner and without any prepossession to what extent software can be patented in the actual state of the law. Within the scope of a socio-economic analysis, it then deals with the question of whether patent law is really the appropriate judicial instrument or if other tools (existing or to be created) must be taken into consideration.
This paper builds on the recommendation in the Scientific and Technological Options Assessment report for the European Parliament to improve the European patent system to ‘increase access to patented inventions’. The paper first provides some background information on the patent system and the limitations on access to protected technology from ‘thickets’ and the so-called ‘tragedy of the anticommons’. It then discusses the use of (some) post-grant measures to increase access to patented inventions. Traditionally, patent law has not paid much attention to such measures. The paper argues that developments suggest that there is good reason to reconsider this reluctance and to include measures in the European patent legislation which seek to increase access to patented inventions. Finally, the paper discusses three such measures: compulsory licences, licences of rights, and behavioural rules. Copyright , Beech Tree Publishing.
This Article focuses on an unappreciated and significant aspect of the debate over property rules in the technology law context. In particular, it argues that the classic justification for legal entitlements protected by a property rule - i.e., a right to injunctive relief - depends on the ability to define and enforce property rights effectively. In the case of many technology markets, the inability to tailor injunctive relief so that it protects only the underlying right rather than also enjoining noninfringing conduct provides a powerful basis for using a liability rule (i.e., awarding the relevant damages to the plaintiff) instead of a property rule. Notably, where injunctive relief cannot be confined to protecting the underlying right, the availability of such relief can give rise to a "holdup strategy," whereby a firm threatens or uses litigation to obtain a settlement significantly in excess of any harm it suffers. Such strategies, as the Article explains, arise in a variety of technology law contexts, including patent law, digital copyright cases, and spectrum regulation. Depending on the particulars of the context, either courts or agencies should superintend the relevant liability regime and, in some cases, the administrative challenges may undermine the case for a liability rule at all. Unfortunately, legal scholars have generally focused on the substantive debate as to the proper scope of property rights - often arguing for an all or nothing solution - at the expense of evaluating the institutional considerations as to whether and when courts or agencies can superintend a liability regime in lieu of a property right.
Clarity can be a considerable virtue in property rights. But even when property rights are defined clearly in the abstract, ascertaining the scope of those rights in concrete situations often entails significant cost. In some instances, the cost of acquiring information about the scope of property rights will exceed the social value of that information. In those circumstances, further search for information about the scope of rights is inefficient; the social harm avoided by further search does not justify the costs of the search. Potential resource users, however, make decisions based on private costs and benefits, not social costs and benefits. Legal rules can create incentives to search for information even when the search would be inefficient. In particular, "property rule" protection often gives leverage to right holders disproportionate to the harm those right holders would suffer from intrusion on their rights. That leverage, in turn, gives potential resource users private incentives to expend time and money on search even when search will generate minimal social benefit. "Liability rule" protection, by contrast, limits incentives to conduct inefficient search for the scope of property rights. Property doctrine reflects this insight in a number of contexts. Thus, high search costs can explain the unwillingness of courts to award injunctive relief in cases of ¿innocent¿ boundary encroachments, as well as the Supreme Court's recent limitations on the routine award of injunctive relief in patent and copyright cases.
When economists speak of an underlying legal structure that imposes an “absolute permission” requirement on access to, and use of, knowledge goods protected by intellectual property rights (IPRs), they typically have in mind the domestic patent and copyright laws. Under these and related intellectual property regimes, one cannot normally make use of a protected invention or creative work of authorship for specified purposes and for limited periods of time without prior authorization of the rights holder, typically in the form of a license. When economists speak of liability rules, in contrast, they envision an underlying legal structure that permits third parties to undertake certain actions without prior permission, provided that they compensate injured parties for all or part of the costs they inflict. While typical examples are found in tort laws regulating the abatement of nuisances, liability rules also abound in the realm of intellectual property law, where, however, their function has largely been overlooked or mischaracterized by legal and economic scholars. In this context, liability rules conjure up a regime built on a “take and pay” principle. Under such a regime, second comers can access and use the protected subject matter for specified purposes without permission, but they must compensate the first comer for these uses in one manner or another. This chapter discusses new forms of liability rules that might profitably be used to stimulate local innovation in developing countries.
The Max Planck Institute for Intellectual Property, Competition and Tax Law is a research institute within the Max Planck Society for the Advancement of Science. For several decades, the Institute has been one of the leading institu- tions in the area of intellectual property rights. With its expertise in these areas of law, the Institute contributes to answering fundamental legal ques- tions and provides impulses for legal developments on the national, European and international levels. In the following, members of the institute give their comments on the Green Paper on "
The genetics community is increasingly concerned that patents might lead to restricted access to research and health care. We explore various measures that are designed to render patented genetic inventions accessible to further use in research, and to diagnosis and/or treatment. They include the often-recited research or experimental-use exemption, conventional one-to-one licensing and compulsory licensing, as well as patent pools and clearing-house mechanisms. The last two alternatives deserve special attention in the area of human genetics.
'Meir Pugatch has done an excellent job by assembling an international and diverse cast of contributing authors, who have offered new insights into a broad span of the most pressing IP-related issues. . . a collection of high quality articles by eminent authorities on IPR is very useful for scholars in the academic fields of law, practitioners, and government officials interested in the field of international trade and intellectual property policy; intellectual property law, technology transfer and valuation and international business.'
This book addresses several aspects of the law and economics of intellectual property rights (IPRs) that have been underanalyzed in the existing literature. It begins with a brief overview of patents, trade secrets, copyrights, and trademarks, and the enforcement and licensing of IPRs, focusing on the remedies available for infringement (injunctions, various forms of damages, and damages calculation issues); the standard of care (strict liability versus an intent- or negligence-based standard); and the rules for determining standing to sue and joinder of defendant for IPR violations. The authors demonstrate that the core assumption of IPR regimes - that IPRs maximize certain social benefits over social costs by providing a necessary inducement for the production and distribution of intellectual products - have several important implications for the optimal design of remedies, the standard of care, and the law of standing and joinder. © Roger D. Blair and Thomas F. Cotter and Cambridge University Press, 2005.
Relying on the economic theory of real property, commentators argue that patent law is better suited to a property rule regime than a liability rule system. The underlying assumption is that ex ante incentives for innovation are best promoted by enabling patent holders to negotiate licenses against the backdrop of an injunction. By contrast, judicially determined damage remedies systematically undervalue innovation. However, recent judicial developments have started to deny injunctions in patent infringement cases in favour of awarding damages, making it appear that patent law will now be increasingly governed by liability rules. This article reflects on this trend by considering the case of patent market failure. It argues that many of the preconditions that work against liability rules similarly affect property rules and private bargaining. Patent market failure is caused by difficulties in valuing (and pricing) innovation, establishing the boundaries of patents and resolving the externalities involved in patent licensing. Patent market failure strengthens the case for liability rules that provide follow-up innovators access to patents, while eliminating the detrimental effect of the anticommons.
It is a common argument in law and economics that divided ownership can create or exacerbate strategic behavior. For instance, when several persons own the land designated for a proposed stadium, individual sellers may "hold out" for a disproportionate share of the gains from trade. Alternatively, when building a public library would benefit multiple residents, individual buyers may "free ride" on the willingness of others to pay for its construction. Such transaction costs of collective action fall under a variety of analytic rubrics, including the "tragedy of the commons" and the theory of "public goods." Nonetheless, each example of market failure shares a common attribute: The division of a single legal entitlement, or of rivalrous entitlements, among joint sellers or joint buyers may prevent socially efficient transactions, particularly when the parties possess private information about their preferences.
This Article explores a different way of dividing an entitlement. Rather than analyzing divisions among buyers or among sellers, we consider the effects of splitting an entitlement between the two groups. Our core insight is Solomonic in character: Dividing a legal entitlement between rivalrous users can facilitate efficient trade. More specifically, we show that when two parties have private information about how much they value an entitlement, endowing each party with a partial claim to the entitlement can reduce the incentive to behave strategically during bargaining, thereby enhancing economic efficiency.
Professor Calabresi and Mr. Melamed develop a framework for legal analysis which they believe serves to integrate various legal relationships which are traditionally analyzed in separate subject areas such as Property and Torts. By using their model to suggest solutions to the pollution problem that have been overlooked by writers in the field, and by applying the model to the question of criminal sanctions, they demonstrate the utility of such an integrated approach.
In this contribution, it is investigated what the apparent economic policy goals are of the EU Copyright Directive of 2001. Additionally, it is explored what, according to mainstream economic theory, will be the likely result of the new regulations on copyright law. The article concludes that the Directive appears to be based on a great belief in the beneficial effects of granting to information producers broad property rights in information products and in the ability of the market mechanism to achieve an optimal result in the information market. However, it may well be argued that the apparent faith in the 'invisible hand' of the market is unjustified where information products are concerned. There may be valid arguments for the legislator to intervene by limiting the freedom of contract and by curtailing the freedom to block any information usage technologically.
Why are many storefronts in Moscow empty while street kiosks in front are full of goods? This article develops a theory of anticommons property to help explain the puzzle of empty storefronts and full kiosks. Anticommons property can be understood as the mirror image of commons property. By definition, in a commons, multiple owners are each endowed with the privilege to use a given resource, and no one has the right to exclude another. When too many owners hold such privileges of use, the resource is prone to overuse ? a tragedy of the commons. Depleted fisheries and overgrazed fields are canonical examples of this familiar tragedy. In an anticommons, multiple owners are each endowed with the right to exclude others from a scarce resource, and no one has an effective privilege of use. When too many owners hold such rights of exclusion, the resource is prone to underuse ? a tragedy of the anticommons. Empty Moscow storefronts are a canonical example of the tragedy of underuse. Anticommons property may appear whenever governments define new property rights in both post-socialist and developed market economies. Once an anticommons emerges, collecting rights into usable private property bundles can be brutal and slow. The difficulties of overcoming a tragedy of the anticommons suggest that policymakers should pay more attention to the content of property bundles, rather than focusing just on the clarity of rights.
This paper examines the adverse effect of patent ambushing on competitive conditions resulting in the distortion of the standardization process in markets where the effectiveness of competition relies heavily on standardization. The US Rambus litigation serves as a point of departure. In this case, the strategic behavior of the patentee was subjected to both an antitrust and unfair competition analysis. Both approaches display an inadequacy to squarely balance all of the conflicting interests involved. The solution proposed is to apply the patent misuse doctrine as a rule that expresses a public policy defense against patent enforcement so as to ensure the precompetitive function of standard-setting bodies. The argument is then taken further by addressing the issue of whether public policy limitations of patent rights are necessary in network industries in order to achieve welfare-enhancing reductions of the exclusionarv effect of the oatent.
Noncommercial users of peer-to-peer systems, such as Kazaa and Gnutella, should be free to distribute and modify files as they wish. But providers of services and devices the value of which are substantially enhanced by such P2P file-swapping should be charged a statutory fee - what I term the Noncommercial Use Levy ("NUL") - set as a percentage of gross revenue. Likely candidates include Internet access, P2P software and services, computer hardware, consumer electronic devices (such as CD burners, MP3 players, and digital video recorders) used to copy, store, transmit, or perform downloaded files, and storage media (like blank CDs) used with those devices. Once collected, levy proceeds would be allocated among copyright holders in proportion to the popularity of their respective works and of user-modified version of their works, as measured by digital tracking and sampling technologies. I estimate that an average levy of some 4 percent of annual retail revenues of P2P-related goods and services would be sufficient to compensate copyright holders for the lost revenues they suffer as a result of NUL-privileged activity, at least for the next 5 years. Following my description of the NUL and how it would operate, I consider some common criticisms that scholars have put forth regarding levies. These include the argument that the NUL would unfairly and inefficiently require low-volume users of copyright-protected material to subsidize both copyright owners and high-volume users. I then favorably compare the NUL with three proffered alternatives for resolving the P2P file sharing controversy. These include (1) "digital abandon," a regime in which the law accords authors neither proprietary control nor a right to receive remuneration for P2P uses of their work; (2) "digital lock-up," a regime in which proprietary copyright reaches full fruition as copyright holders use digital encryption to control all uses of their works; and (3) a regime of government compensation to copyright holders paid out of general tax revenues rather than a levy on P2P-related goods and services. My proposed NUL is not a panacea. But a balance of trade-offs favors it over the alternatives.
The previous issue of Regulation contains a provocative attempt by University of California, Berkeley law professor Peter Menell to discredit what he calls the property rights movement (PRM) for its supposed "absolutist" stance on intellectual property. As part of the article, he asserts that I participate in (or perhaps even lead) a movement that poses a profound danger to the efficient operation of our complex system of intellectual property law, especially as it relates to patents and copyrights. In this article, I argue that this characterization is inaccurate. I believe that there are rights over intellectual property, but they differ in important ways from rights over real property.
This paper considers the proposed settlement agreement between Google and the Authors Guild relating to Google Book Search. Google boldly launched Google Book Search in pursuing its goal of organizing the world’s information. Even though Google was sensitive to copyright values, the service relied on mass copying and thus Google undertook a substantial legal risk in setting up the service. That risk was realized with the lawsuits by the Authors Guild and the Association of American Publishers. The October, 2008 settlement agreement for those suits will create an important new copyright collective and will legitimate broad-scale online access to United States books registered before early January, 2009.The settlement agreement is exceeding complex but I have focused on three issues that raise antitrust and competition policy concerns. First, the agreement calls for Google to act as agent for rights holders in setting the price of online access to consumers. Google is tasked with developing a pricing algorithm that will maximize revenues for each of those works. Direct competition among rights holders would push prices towards some measure of costs and would not be designed to maximize revenues. As I think that that level of direct coordination of prices is unlikely to mimic what would result in competition, I have real doubts about whether the consumer access pricing provision would survive a challenge under Section 1 of the Sherman Act.Second, and much more centrally to the settlement agreement, the opt out class action will make it possible for Google to include orphan works in its book search service. Orphan works are works as to which the rightsholder can’t be identified or found. That means that a firm like Google can’t contract with an orphan holder directly to include his or her work in the service and that would result in large numbers of missing works. The opt out mechanism - which shifts the default from copyright’s usual out to the class action’s in - brings these works into the settlement.But the settlement agreement also creates market power through this mechanism. Absent the lawsuit and the settlement, active rights holders could contract directly with Google, but it is hard to get large-scale contracting to take place and there is, again, no way to contract with orphan holders. The opt out class action then is the vehicle for large-scale collective action by active rights holders. Active rights holders have little incentive to compete with themselves by granting multiple licenses of their works or of the orphan works. Plus under the terms of the settlement agreement, active rights holders benefit directly from the revenues attributable to orphan works used in GBS.We can mitigate the market power that will otherwise arise through the settlement by expanding the number of rights licenses available under the settlement agreement. Qualified firms should have the power to embrace the going-forward provisions of the settlement agreement. We typically find it hard to control prices directly and instead look to foster competition to control prices. Non-profits are unlikely to match up well with the overall terms of the settlement agreement, which is a share-the-revenues deal. But we should take the additional step of unbundling the orphan works deal from the overall settlement agreement and create a separate license to use those works. All of that will undoubtedly add more complexity to what is already a large piece of work, and it may make sense to push out the new licenses to the future. That would mean ensuring now that the court retains jurisdiction to do that and/or giving the new Registry created in the settlement the power to do this sort of licensing.Third, there is a risk that approval by the court of the settlement could cause antitrust immunities to attach to the arrangements created by the settlement agreement. As it is highly unlikely that the fairness hearing will undertake a meaningful antitrust analysis of those arrangements, if the district court approves the settlement, the court should include a clause - call this a no Noerr clause - in the order approving the settlement providing that no antitrust immunities attach from the court’s approval.
Extended collective licensing. also known as extended repertoire, originated in the Nordic countries. It may be useful to accelerate the acquisition of licensing authority by Collective Management Organizations. This paper considers the pitfalls to avoid and the international legal context.
The idea that there is a tension between antitrust and the intellectual property laws is readily exaggerated. The tension that exists results mainly from our uncertainty about the optimal amount and scope of IP protection. In general, antitrust draws clearer lines than intellectual property law does, although one should not push the point too far. Antitrust policy as manifested in the courts has achieved a fair amount of consensus today. By contrast, deep uncertainty remains about fundamental questions concerning the socially optimal outcome of IP disputes. In addition, while the antitrust statutes are for the most part public regarding provisions interpreted by the courts, the IP laws have increasingly become special interest statutes less concerned with optimal IP coverage and more concerned with protection of the claims of particular interest groups. As a result, antitrust needs to take a bolder position in areas of potential conflict with IP law than it has in the past. This does not mean that we must revert to a post-New Deal regime in which the courts imagined threats from IP rights where none existed. However, it does entail that antitrust stop being so deferential in areas where threats to competition are real and the IP laws are ambiguous on the issue in question.
Digital communication media such as the Internet pose difficult challenges for traditional forms of intellectual property protection. Much recent scholarship and considerable governmental attention has been focused on adapting and expanding copyright to encompass digital works of authorship. These efforts have been justified on the grounds that clear property rights are necessary to allow efficient allocation of intellectual property between private parties. However, these rationales ignore the literature regarding the efficiency of unclear or "muddy" property entitlements. Where transaction costs of private bargaining are high, "muddy" rules will tend to force parties into informal bargaining transactions. Transaction costs on the Internet may tend to be high because of the number of parties involved, the difficulty of locating the parties, increased opportunity for strategic behavior, and the transborder nature of the medium. Thus, informal transactions or "self-help" may be the most efficient means for provision of digital works. In such a case, "muddy" or unclear rules should perhaps be favored for on-line entitlements.
Repeated depiction of justifying Intellectual property rights using mere economic incentive rationale is some what outdated and exhaustively used. This paper discusses the existing rationales and also makes an attempt to understand the underlying principle for justification of intellectual property rights using game theory. I contend that the intellectual property rights does matter and it affects the strategic behaviour of inventors, who interact under the given conditions. Analysis of strategic behaviour assists not only in understanding the dominant strategy for the players under a given system but also how these dominant strategies mould the strengthening of laws to protect the market rights of these individual players. This paper also makes an attempt to study how dominant strategies in a game can influence the shaping up of domestic and international laws.
In continental Europe, copyright law is traditionally viewed as a so-called 'natural' right - briefly put: it is simply right for the author to enjoy the fruits of his labor. However, socio-economic considerations are becoming more in important in European copyright doctrine. One reason for this tendency is that more and more copyright matters are regulated at the EU level and that the European regulator explicitly adheres to the economic rationale for copyright law. In this contribution, it is investigated what the apparent economic policy goals are of the EU Copyright Directive of 2001 - which is by far the most ambitious piece of EU legislation in the area of copyright to date. The purpose of this article is not to set-out new, cutting-edge economic theories on copyright law, but merely to analyze what the explicit and implicit aim of the Directive is and to explore what, according to standard, mainstream and widely known economic theory, will be the likely result of the new regulations on copyright law. Will the Copyright Directive succeed in achieving its apparent goals? What does economic theory predict about its impact? The emphasis is on the most important and controversial changes that the Copyright Directive brings about. These are the introduction of a right of temporary reproduction, the limiting of the exhaustion of copyright, the abolishing of remuneration rights and, last but certainly not least, the broad protection of technological measures - i.e. DRM systems. The article concludes that the Directive appears to be based on a great belief in the beneficial effects of granting property rights in information products and in the ability of the market mechanism to achieve an optimal result. However, it may well be argued that apparent faith in the 'invisible hand' of the market is unjustified. Particularly, the public good character of information products is not taken into account. Moreover, the provisions of the Directive may hinder competition to a further extent than copyright traditionally did, which could have an undesirable result as well. Additionally, the apparent reliance on market forces to match the demand for uses with the offered technological usage restrictions may be unsubstantiated. There may be valid arguments for limiting the freedom of contract and the freedom to block any information usage technologically.
"Intellectual property" is increasingly a misnomer since the right to exclude is the defining characteristic of property and incentives to engage in inventive and creative activity are increasingly being granted in the form of liability rights (which allow the holder of the right to collect a royalty from users) rather than property rights (which allow the holder of the right to exclude others from using the invention or creation). Much of this recent reorientation in the direction of liability rules arises from a concern over hold-out or monopoly power in intellectual property. The debate over whether liability rules or property rules are preferable for intellectual property has focused too narrowly on the benefits and costs of allowing the right to exclude, which is only one stick in the potential bundle of rights. Each stick in the bundle interacts with other sticks to affect both the rewards from engaging in inventive and creative activity and the social costs attributable to the grant of the rights. Sometimes, the optimal solution is to allow the exercise of other market-power conferring rights but to remove the right to exclude. Administrability of a liability rights oriented regime should not be a major concern, since liability rules usually result in private bargaining rather than judicial or administrative rate setting.
The paper points out the relevance of competition law to international issues of Intellectual Property Law (IPR) and demonstrates how competition law internationally has come to function as an indispensable instrument to balance IPR. The perspective is international and focused on TRIPS. The rules in TRIPS which define the obligations of member states to protect rightholders are detailed, comprehensive, and aimed at a high level of protection. The few rules in the Treaty which deals with competition law and the role of competition as a balancing instrument to IPR are weak and imprecise. This disparity does not reflect the conclusion in national law where it is now generally acknowledged that IPR and competition law serve the same goal, viz. dynamic efficiency and consumer welfare and where competition law has come to function as a second tier of balancing norms. The paper claims that the weakness of the competition rules in TRIPS may be counterproductive towards the broader goals of IPR protection. From a development point of view it is pointed out that an effective and well function market is necessary in order for developing countries to reap any benefits arising out of IPR protection. To innovation it is submitted that IPR protection e.g. of interfaces or in markets characterised by network effects may involve risks of monopolisation which require access to effective rules of competition law. The paper finally recommends concrete changes to TRIPS in the form of mandatory rules which prevent abuse in licensing contracts and a rule which makes it possible to gain access to IPR which is indispensable for competition.
The Problem to be ExaminedThe Reciprocal Nature of the ProblemThe Pricing System with Liability for DamageThe Pricing System with No Liability for DamageThe Problem Illustrated AnewThe Cost of Market Transactions Taken into AccountThe Legal Delimitation of Rights and the Economic Problem
During the past fifteen years, changes in technology have generated an extraordinary array of new ways in which music and movies can be produced and distributed. Both the creators and the consumers of entertainment products stand to benefit enormously from the new systems. Sadly, we have failed thus far to avail ourselves of these opportunities. Instead, much energy has been devoted to interpreting or changing legal rules in hopes of defending older business models against the threats posed by the new technologies. These efforts to plug the multiplying holes in the legal dikes are failing and the entertainment industry has fallen into crisis. This provocative book chronicles how we got into this mess and presents three alternative proposalsâeach involving a combination of legal reforms and new business modelsâfor how we could get out of it.
This book takes a fresh look at the most dynamic area of American law today, comprising the fields of copyright, patent, trademark, trade secrecy, publicity rights, and misappropriation. Topics range from copyright in private letters to defensive patenting of business methods, from moral rights in the visual arts to the banking of trademarks, from the impact of the court of patent appeals to the management of Mickey Mouse. The history and political science of intellectual property law, the challenge of digitization, the many statutes and judge-made doctrines, and the interplay with antitrust principles are all examined. The treatment is both positive (oriented toward understanding the law as it is) and normative (oriented to the reform of the law).
Previous analyses have tended to overlook the paradox that expanding intellectual property rights can effectively reduce the amount of new intellectual property by raising the creators' input costs. Those analyses have also failed to integrate the fields of intellectual property law. They have failed as well to integrate intellectual property law with the law of physical property, overlooking the many economic and legal-doctrinal parallels.
This book demonstrates the fundamental economic rationality of intellectual property law, but is sympathetic to critics who believe that in recent decades Congress and the courts have gone too far in the creation and protection of intellectual property rights.
Table of Contents:
Introduction
1. The Economic Theory of Property
2. How to Think about Copyright
3. A Formal Model of Copyright
4. Basic Copyright Doctrines
5. Copyright in Unpublished Works
6. Fair Use, Parody, and Burlesque
7. The Economics of Trademark Law
8. The Optimal Duration of Copyrights and Trademarks
9. The Legal Protection of Postmodern Art
10. Moral Rights and the Visual Artists Rights Act
11. The Economics of Patent Law
12. The Patent Court: A Statistical Evaluation
13. The Economics of Trade Secrecy Law
14. Antitrust and Intellectual Property
15. The Political Economy of Intellectual Property Law
Conclusion
Acknowledgments
Index
Reviews of this book:
Chicago law professor William Landes and his polymath colleague Richard Posner have produced a fascinating new book...[ The Economic Structure of Intellectual Property Law ] is a broad-ranging analysis of how intellectual property should and does work...Shakespeare's copying from Plutarch, Microsoft's incentives to hide the source code for Windows, and Andy Warhol's right to copyright a Brillo pad box as art are all analyzed, as is the question of the status of the all-bran cereal called 'All-Bran.'
--Nicholas Thompson, New York Sun
Reviews of this book:
Landes and Posner, each widely respected in the intersection of law and economics, investigate the right mix of protection and use of intellectual property (IP)...This volume provides a broad and coherent approach to the economics and law of IP. The economics is important, understandable, and valuable.
--R. A. Miller, Choice
Intellectual property is the most important public policy issue that most policymakers don't yet get. It is America's most important export, and affects an increasingly wide range of social and economic life. In this extraordinary work, two of America's leading scholars in the law and economics movement test the pretensions of intellectual property law against the rationality of economics. Their conclusions will surprise advocates from both sides of this increasingly contentious debate. Their analysis will help move the debate beyond the simplistic ideas that now tend to dominate.
--Lawrence Lessig, Stanford Law School, author of The Future of Ideas: The Fate of the Commons in a Connected World
An image from modern mythology depicts the day that Einstein, pondering a blackboard covered with sophisticated calculations, came to the life-defining discovery: Time = $$. Landes and Posner, in the role of that mythological Einstein, reveal at every turn how perceptions of economic efficiency pervade legal doctrine. This is a fascinating and resourceful book. Every page reveals fresh, provocative, and surprising insights into the forces that shape law.
--Pierre N. Leval, Judge, U.S. Court of Appeals, Second Circuit
The most important book ever written on intellectual property.
--William Patry, former copyright counsel to the U.S. House of Representatives, Judiciary Committee
Given the immense and growing importance of intellectual property to modern economies, this book should be welcomed, even devoured, by readers who want to understand how the legal system affects the development, protection, use, and profitability of this peculiar form of property. The book is the first to view the whole landscape of the law of intellectual property from a functionalist (economic) perspective. Its examination of the principles and doctrines of patent law, copyright law, trade secret law, and trademark law is unique in scope, highly accessible, and altogether greatly rewarding.
--Steven Shavell, Harvard Law School, author of Foundations of Economic Analysis of Law
This Chapter addresses the extremes of private ordering, and the extent to which the principal multilateral copyright instruments, the Berne Convention and the TRIPs Accord, limit the range of State responses to the problems encountered at the far ends of the copyright-contract spectrum. At one end, we encounter private ordering at its most aggressive, in which private parties enter into agreements (or, more likely, the stronger party coerces the weaker parties, who may be mass market consumers) to protect subject matter or rights excluded from the ambit of copyright's exclusivity. At the other end, the difficulties arise not from overweening sellers forcing their way with timid buyers, but from failure to find the seller at all. The buyers, would-be copyright exploiters, are unable to locate the right holders from whom to negotiate a license to use their works. In this case, no contract can be concluded, unless the State steps in for the absent right holder. In the first case, a contract has been concluded, but at a cost that the State could not exact were it to seek the same result through public ordering.The analysis of Part I proceeds in three steps. First, a review of the relevant Berne-TRIPs provisions will identify and assess the "maxima." Second, consideration will be given to whether the prescriptive force of the maxima extends to extra-copyright means of achieving copyright-prohibited objectives. Finally, an inquiry will be made into whether the mandatory exclusions and restrictions apply only to foreign Berne Union works or whether the treaties can also be read to compel their domestic application. Part II shifts from private ordering to State-imposed licenses and other interventions that limit the exercise of exclusive rights. Where Part I inquires whether current multilateral instruments limit private parties' freedom effectively to expand the scope of copyright subject matter or rights, Part II examines whether those same instruments constrain State responses to systemic failures of private ordering by limiting the remedies available against the unauthorized exercise of otherwise exclusive rights. The example of failed private ordering that will be considered concerns the problem of "orphan works," where the inability to find right holders means that would-be exploiters cannot enter into private agreements with them.This exploration of the extremes of the copyright-contract spectrum finds little prescriptive force in the Berne-TRIPs "maxima" with respect to private agreements to protect subject matter the treaties exclude from copyright's ambit. By contrast, Berne-TRIPs "minima" can meaningfully constrain a State's prerogative to impose compulsory licenses or limit remedies when private agreements cannot be concluded, for example because a willing buyer cannot find the seller (willing or otherwise). The minima should not, however, be regarded as an impediment to resolving the "orphan works" problem. Rather, attention to the minima should enable States to shape an orphan works regime which both permits the exploitation of unlocatable right holders' works, and fairly compensates those right holders who, notwithstanding a rigorously diligent but unsuccessful search, subsequently turn up and object to the uses made of their works.
This Comment, after a brief review of the nature of the orphan works problem and prior attempts to resolve it in the US, will analyze the current bills' provisions, both with respect to the limitation of remedies that constitutes the proposals' centerpiece, and to the conditions required to qualify for the limitation. I will also compare the US proposals with current European initiatives, and will assess the compatibility of the US proposals with international treaty norms, as well as the cross-border consequences of inconsistent US and EU orphan works regimes. I will conclude with some suggestions for amending the US proposals to enhance their international compatibility and to reconcile the interests of users more fully with those of the works' creators.
Incentives to develop basic technologies are greater if the patentholder profits from applications or other second-generation products. Assuming that such products infringe the basic patent and that there is not much delay between the innovations, I argue that (i) patents on second-generation products are not necessary to encourage their development and (ii) the patentholder of the basic technology collects a larger share of the profit if applications or other second generation products are not patentable.
The population problem has no technical solution; it requires a fundamental extension in morality.
Increasing Access to Patented Inventions, Science and Public Policy
- Jens Schovsbo
Schovsbo, Jens, Increasing Access to Patented Inventions, Science and Public Policy, October 2009
(2009 b), SSRN No. 1393755
Mandatory Collective Administration of Exclusive Rights – A case Study on its Compatibility With International and EC Copyright Law
- Silke V Lewinski
Lewinski, Silke v., Mandatory Collective Administration of Exclusive Rights – A case Study on its
Compatibility With International and EC Copyright Law, UNESCO eCopyright Bulletin, January-
March 2004.
Internet & création -Comment reconnaître des echanges sur l'internet en finançant la creation
- Philippe Aigrain
Aigrain, Philippe, Internet & création -Comment reconnaître des echanges sur l'internet en finançant la creation? (2008)