Thursday, April 01, 2010

Transfer fees and IP rights

An alert student pointed me to this article about developers' attempts to impose transfer fees for 99 years. Wonder how that fares under the Restatement of Servitudes as a restraint on alienability? Anyway, I was struck by the justification offered by a principal promoter of this plan, being marketed to developers around the country:
“Just like authors who write books and musicians who write songs that will be enjoyed for generations to come, those who improve property are also engaged in the creative process, and the economics of the transaction should reflect that reality,” a Freehold brochure says.
We are used to IP owners arguing from real property concepts of absolute dominion (often highly exaggerated) to enhance their own rights. Now IP is so absolute in the popular imagination that we are seeing real property owners make the opposite move. Is the analogy to termination of transfers? Public performance rights? Or really just an inchoate "these guys seem to be making money, I'd like to as well"? Perhaps someone ought to explain recording industry contracts and works for hire to them.


Bruce Boyden said...

Plus the justification is totally nonsensical. People who improve real property do get economic compensation for it, in the form of a higher sale price. (I would argue that the same should be true in IP, but that's another discussion.)

Mac Harwood said...

To quote the article:

"While the company says it has a patent pending, the U.S. Patent and Trademark Office denied the patent last year and lists the application as “abandoned.”"

To quote 35 U.S.C. 292(a):

Whoever marks upon, or affixes to, or uses in advertising in connection with any article the words .. “patent pending,” .. when no application for patent has been made, or if made, is not pending, for the purpose of deceiving the public - Shall be fined not more than $500 for every such offense.

There might be a curious loophole, though. If they applied the words to the website when it was pending, but then deliberately chose not to remove the words since then - are they in the clear ? After all, when they applied the words it was true.