Drake part 7

Panel 7: Patents and Commercial Law

Prof. Sapna Kumar, University of Houston Law Center

The Accidental Agency?

Fed. Cir. is functionally the administrator of the Patent Act. It’s unusual to have no agency interpreting, and the Fed. Cir. has filled the gap.  Judge Rich also shaped the change from the CCPA, which used to be very deferential to the PTO.  Separation of powers issues?

Is this a stable model?  No.  Not because it wasn’t working before, not because it couldn’t work in an ideal universe, but it’s because of the tension between Congress and the Supreme Court.  Congress wanted a strong court with the power to unify patent law; even though PTO gets new powers under AIA, Federal Circuit is still the check.  But the Supreme Court is fighting back: they want to unify administrative law.  No reason to treat tax cases differently just because they’re tax; IRS gets Chevron; no exceptionalism in administrative law.  This would prevent Fed. Cir. from being one-stop shop for unifying patent law.

SCt is also uneasy with bright-line rules.

Prof. Daryl Lim, John Marshall Law School

Deconstructing Patent Misuse

Gorillas in our midst: people miss the gorilla that walks across the screen because they’re paying attention to something else.  We can miss the obvious and unaware that we’re missing it.

Two kinds of misuse: harm to patent system and harm to competition.  SCt today may be more sympathetic to older arguments since the inception of the Federal Circuit; thus it may be willing to make misuse more broadly applicable. TM and copyright cases percolate up through various circuits, but the SCt may be concerned that doctrinal checks should be stronger where institutional checks are weaker.  Antitrust people are very worried about patents—big entities are letting trolls assert patents and sharing the bounties; also concerns with drugs.

Harm to innovation and harm to competition are different.  Fed. Cir. may understand innovation better, but if it doesn’t pay attention to competition, another decisionmaker will start doing so.

Dr. Nahoko Ono, Visiting Scholar, Columbia University School of Law (Japan)

Bridging the Divide Between IP Law and Commercial Law in Light of Secured Transaction

Importance of IP, particularly through bundled rights worth billions.  Secured transactions: UCC art. 9 is supposed to cover all personal property including general intangibles.  Functional approach: substance over form.  But there is case law confusion about where to file. At the copyright office? Some cases say yes, others say it should be a state filing, as do cases involving TM and patent.  Which would produce a better, more predictable rule?  Divide between IP and commercial law, but also a divide between copyright and patent/TM.

Reform efforts got some support from the ABA to make a uniform IP perfection system, but nothing really happened.  Motion picture/copyright lobbies didn’t like it.

Economists and federal government want track records; state gov’t wants a source of revenue; lenders want a one-stop registry; IP owners want an IP one-stop registry.  But what would one-stop look like?  All personal property?  All IP?  Just maintain office-based recordation systems, Copyright and USPTO together

UCC article 9 deals with federal statutes governing the rights of parties to and third parties affected by transactions—a copyright preemption provision.  Issues still remain, for example perfection of security interest in an unregistered copyright.  Is there an indirect conflict with the Berne Convention, which precludes formalities?

Even if we revised patent & TM law, nonfederal protected IP exists, such as common law copyright and state TMs. ?  (I wonder how the right of publicity fits in.)  In addition, federal statutes are still asset-based, as opposed to modern secured transactions based on cash flow from underlying assets.  Possibly an international registry is the answer.

Prof. Jason Rantanen, University of Iowa College of Law

In Memoriam Best Mode

Best mode has been criticized: e.g., disadvantages foreign applicants; can be unimportant when patent expires and tech has moved on over 17 years.  AIA stripped courts of power to invalidate for failure to provide best mode. Still technically in the law but effectively eliminated.

Withholding best mode can reduce the public domain defining benefit of the patent—makes the boundaries of the patent less clear.  Inventions that are more completely disclosed—more than bare bones, but also best mode—provide higher quality prior art.  Any example is better to think with, and thus better at creating a public domain, than an abstract description.

Prof. Karen E. Sandrik, Florida State University College of Law

Reframing Patent Remedies

Property/trespass rules make the most sense for patents.  When a tech is very important to lots of other people (losing our iPhones), we should have a small exception denying injunctive relief and rewarding damages.  What about the problems where a big product uses a tiny patented component? Very hard to get injunctive relief for those patentees.  Microsoft tried to make i4i’s software obsolete—seems willful.  But other people would lose millions from taking Word off the market—so do we allow a willful infringer to keep infringing and just award punitive damages?  With a liability structure after eBay, we will see more and more of these big companies that can’t be forced to the bargaining table.  Should incentivize small companies to invest with a property rule.  We can keep Microsoft without creating bad incentives by having very limited exceptions to the property rule.  eBay had publicly announced that it had a design-around, and yet the district court went ahead and allowed it to continue.  Other cases, including i4i, had similar facts.  Injunctions lead them to sit down at the bargaining table; can also stay the injunction for a transition to the design-around.

Holdouts who try to extract far more than their component is worth: can issue an incomplete privilege, finding infringement and awarding liability damages until there’s a design around.  Majorities of patentees would still have the property rule structure.

Prof. Christopher B. Seaman, Chicago-Kent College of Law

The Presumption of Validity in Patent Litigation: An Experimental Study (with Prof. David Schwartz, Chicago-Kent College of Law)

What is the proper burden of proof for invalidity?  Preponderance, at least when PTO didn’t consider the prior art at issue?  SCt held that the standard was clear & convincing evidence, but jury could hear that it was hearing evidence the PTO had no opportunity to hear in its own examination.

Would eliminating clear & convincing burden result in different jury outcomes? There haven’t been many civil jury studies on the burden of proof.

External validity: short fact pattern v. detailed evidence at trial; reading v. live witnesses; this study asks for individual decisions rather than deliberation, but hope to change that in future studies.  Inattention to fact pattern is also a risk, though attempted to control for that with validation questions.

Fact pattern based on actual golf ball case, with a piece of prior art not disclosed to the PTO.  3 conditions: Given clear & convincing standard, c&c with instruction stating the burden is more easily satisfied when the prior art wasn’t considered by the examiner, and preponderance.  Used Mechanical Turk, group broadly representative of US population.

Asked the Q: did the accused infringer prove by C&C/preponderance that the patent was obvious.  C&C was lower (27.1%) and preponderance higher (38.3%). But the C&C plus i4i percentage of those concluding that the patent was obvious was actually higher (43.6%) than for preponderance.  Possible demand effect?  Addition of instruction may give cues about what constitutes appropriate decisionmaking.  “Is” easier to satisfy v. “may be” easier to satisfy D’s burden.  “In this case” may also serve as a signal.  Tested different formulations.  No satistically significant differences between three varieties, including may/is, though close to statistical significance.

Q for Sandrik: trespass seems difficult in cases of independent invention.

Sandrik: yes, thinking of dropping the trespass part because it bites off a bigger debate.

Q for Ono: consider issues about unfinished works that are used as collateral while unfinished (e.g., films).

Ono: Wants a user-friendly regime.  If we think about international system, a title-based recordation system isn’t universal.  Cash-flow basis would be a better way to look at it.

Drake part 6

Panel 6: Trademarks and Unfair Competition

Prof. Sean A. Pager, Michigan State University College of Law

Unpacking Traditional Knowledge Rights and Wrongs

WIPO is busy drafting TK treaties and there’s a burgeoning literature. Often begins with a misappropriation anecdote, then laying out proposed rights and remedies. How you characterize the injury in the anecdote matters a lot for the rights and remedies one might design to follow.  Outsider comes into community, takes part of cultural heritage without consent, strip it of time-honored meaning, and commoditize it into an external market in an inauthentic, possibly offensive way.  Ending: community devastated by loss, tradition despoiled; indignity compounded by the knowledge that someone else is making money and they aren’t benefiting.

In this archetype there are two distinct injuries: harm to authenticities, a cultural injury; then economic injury/unjust enrichment.  For the latter, cutting a check/rough justice is probably ok; level of governance will be thinner than the necessarily thick regulation of cultural injuries.  What about geography, local v. globalism?  Cultural injuries are more likely to be local, local decisionmaker is more likely to govern more effectively for the interest; you might not need to worry about global harms because the harm from local violations will be felt disproportionately.  Whereas an economic rule, especially if it’s merely calculating a price, can be more easily expanded in geographic scope, and there’s no reason to think that someone making $ locally is any worse than someone making $ across the world.

Biological development: countries have access, but don’t have development resources to commercialize/synthesize—there is a holdup problem and an economic solution; need a global mechanism to solve it. Cultural resources are different: shaman’s melody; still recognizably derived from the shaman’s melody, thus capable of inflicting cultural harm. And yet primarily these harms are going to be local.  Sustained, serious uses will be by communities that are proximate to the affected community, because that’s how culture flows.  NCAA mascots as a US TK issue: why is it that all these American sports teams have Native American instead of Australian Aborigine mascots?  In Australia, the iconography is aboriginal rather than Native American, and the harms of inauthentic use are local.

Prof. Jake Linford, Florida State University College of Law

Trademark Owner as Adverse Possessor

TM owner resembles an adverse possessor through the process of acquiring TM protection. Requirements: actual possession, open and notorious, exclusive, continuous for statutory period, hostile/without permission/under claim of right. There are fights over whether good faith/knowing is the right standard, and other details of color of title.  Property rights in TM are not property rights in words, but property rights in words used to signify particular meanings for goods and services; this can be expansive for dilution but still isn’t ownership of the words themselves.  You secure rights by showing courts you’re serious/responsible about it. 

Courts think commercial strength trumps inherent strength. It’s acquisition of secondary meaning that matters, but we have no real solid rules about how that’s acquired. We presume in 2(f) that substantially exclusive continuous use for 5 years creates secondary meaning, but PTO has told examiners to ask for more in the case of trade dress, muddying the rules and creating uncertainty.  Rely more on what mark owners are doing in commerce than cleverness of the initial mark.  What if we turned 2(f) into a floor on the amount of time to acquire distinctiveness?  That could provide more certainty for competitors and consumers.

Not every crystalline rule necessarily benefits consumers.  If you had an inherently distinctive mark, failure to establish commercial strength might not hurt your chances of winning, at least for the first 5 years.  We may actually be doing this in practice, as he looks at likely confusion cases.

Posner: a TM owner has to be serious about protecting it; at the same time, not allow from the public domain a name the public is using to denote someone else’s good or service.  This approach was disregarded in Golan; we have a more active public domain in TM than in copyright.

(My comment: presumptions about strength are not really about confusion, and we should consider stopping pretending that they are.  EU approach: rights over the use regardless of likely confusion.)

Prof. Joseph A. Tomain, Florida Coastal School of Law

First Amendment, Fourth Estate and Hot News: Misappropriation Is Not a Solution to the Journalism Crisis

The NYT invents the news.  We need an institutional press with resources to cover what citizen journalists can’t.  Reap what you sow = occasionally a threat: you will get what’s coming to you.  Also, sometimes you’re forbidden from reaping what you sow.

The utilitarian claim is the key one: public will lose info necessary for self-governing society without a misappropriation right. 

Recall the history of INS v. AP: Hearst couldn’t send reporters of its own because it was excluded by the Allies.  This should make us wary about First Amendment implications of misappropriation.  In addition, who gets to decide what the value of the news is, or whether it’s degraded?  Vagueness is a worry. Prior restraint on information from a permanent injunction.  Does not appear to him to raise problems of content-based regulation, but assessing it by content-neutral standards still creates problems for things like injunctive relief; perhaps only monetary damages should be allowed.

Daily Mail principle: publication of lawfully obtained information is protected absent a state interest of the highest order.  Can hot news really pass this standard?  Name of a rape victim, contents of illegally recorded conversation, juvenile defendant’s identity: is economic incentive really more important than these interests?  Only at the most generalized level.

Golan: the public domain isn’t inviolate, so the SCt might let this pass.  But is there a difference between taking a work out of the public domain and taking facts out?

Utilitarian analysis: if constitutionally permissible, still a good idea?  Very hard to prove harm to newsgathering incentive.  Should courts be allowed to presume that harm naturally follows free riding? No, evidence ought to be required.

The real trouble: lost ad revenue.  Concentrated ownership of media outlets.  Taxation of online ads with revenue going back to the institutional press might be a way of supporting that press.

Dr. Katja Lindroos (Weckström), Lecturer in Intellectual Property Law, Faculty of Law, University of Turku (Finland)

Injunctions Against Intermediaries

TRIPS: effective measures against infringement; requires injunctions against certain types of infringement.  Doesn’t say injunctions have to be available against all types of TM infringers—minimum standards. Criminal sanctions against willful TM counterfeiting on a commercial scale.  EU: enforcement directive, 2004, covering all IP as TRIPS implementation—a long list of sanctions member states must afford; member states resisted and thought it was overbroad.  But still required!  Rightholder has a right to injunctions against noninfringing third parties.  2000 E-commerce directive; covers all IP too; narrow safe harbors for mere conduits, caching, hosting; (discussion on that centered around copyright despite scope of directive); no duty to monitor.  ACTA covers TM, copyright, and related rights. 

What is TM counterfeiting?  She showed “abibas” shoes, with a logo very similar to that of adidas.  But when it’s a fake iPod, are we really talking more about copyright or TM infringement, or even product liability?  Under current law, TM is the rubric.  Who goes to jail for TM counterfeiting?  French want to throw shoppers in jail.

Spotting the fake may be easier in physical space than online: if offered a Louis Vuitton on eBay, it may look just like the real one.  With copyright, we know that the rightholder can authorize digital sales; if the copyright owner says no, we know it’s an unauthorized copy. But with TM, it’s not that easy to distinguish between legal/illegal items on an auction site because of first sale.  We can’t assume the same type of absolute control as in copyright.

L’Oreal v. eBay: ECJ said eBay isn’t directly or contributorily liable under TM directive; nonetheless, injunctions must be available to rightholders under enforcement directive regardless of fault.

Helsinki District Court: Elisa must prevent subscribers from accessing Pirate Bay domains, big fine pending resolution of the case.

O’Melinn for Tomain: Is hot news content-based?  Say more about reasoning and about Golan.

Tomain: Given Golan, wouldn’t be surprised if Court could take facts out of the public domain, though that’s wrong.  Not content based because could have any content: sports, politics, etc.

For Pager: what would the baseline be for remedying cultural harm?

Pager: culturally defined—what is a harm, who is entitled to do this?  Devolve to local decisionmakers; a WIPO treaty could create the baseline principles.

Yu: indigenous communities often don’t want to separate TK and traditional cultural expression, economics/culture.

Pager: true, but we split IP all the time: copyright and TM.  Separating them doesn’t mean there’s an ontological distinction.  This has been overly politicized.

Corbett for Weckström: what standard must eBay follow?

A: notice and takedown for copyright, but not clear what TM requires.  L’Oreal has stopped sending notices, because they feel it’s not a good enough remedy.  Issue for court: possible injunction to get closer to active monitoring even though the court says monitoring shouldn’t be required; up to national courts to strike a reasonable and fair balance.  Discussion is somewhere between notice and takedown and an active duty to monitor.  German court—remove listings that say “replica” or “copy.” But then we have to discuss whether these tools are reliable or overinclusive.  German court on remand said that removing copy/replica listings was sufficient.  Once you have evidence from the TM owner that there’s routine infringement, might have to monitor IP address to prevent creation of new accounts.

Corbett: offline shop also has duties.

A: but eBay is not selling just one item; also eBay doesn’t have custody of a physical item, only a product description.  Not like a flea market where the seller can inspect the product and figure out if it’s fake.  Even with a picture, authentication is almost impossible.  Can use indicia—where sold, price, how many on offer—but that’s not as predictive as we might want.  Overinclusiveness isn’t as big a problem in copyright (well, it isn’t w/r/t digital downloads, as opposed to sale of copies, at least where there’s been a first sale; but I suppose if there’s no exhaustion of the distribution right, at least across national boundaries, then physical copies are also at issue).

Drake part 5

Panel 5: Copyright Law

Susan Corbett, Senior Lecturer, School of Accounting and Commercial Law, Victoria University of Wellington (N.Z.)

The Photographer and Her Subject: The Case for Joint Ownership of Copyright in Photographs of the Human Image

ECJ: the concept of private life is a broad one which encompasses the right to identity. A person’s image reveals his or her unique characteristics and constitutes one of the chief attributes of her personality – in a case about an unauthorized photo of a newborn. 

Problem: Years of debate over whether photos should have copyright protection + democratization of publishing online; if we own our photos, we have the right to publish them + advanced tech that makes taking photos easy, frequently without the knowledge of the subject. In most countries there’s no absolute right not to be photographed or to prevent publication.  But most of us would claim some sort of rights over our images.

Breach of confidence won’t always work; passing off will also not cover most commercial uses, nor will misappropriation of personality; privacy will generally have high standards for breach.  Free speech interests often seem more compelling.

Early photography required substantial skill & effort by photographer, and the participation of the subject, who’d be told what to wear, how to pose, etc.  Things have changed.  Derrida: whatever precautions you take, … the photograph surprises you. It is the other’s gaze that wins out and decides.  She proposes co-ownership as a more robust protection than privacy.  Copyright has an established int’l regime, a statutory acknowledgement of public interest balance; provides for joint ownership.

But is it true that all photos have the requisite level of originality to be protected by copyright.  Standard in NZ is low: requires skill and effort of a minimal level; it is only that it is “not copied.”  Standard differs elsewhere.  But being in the right place at the right time is an established threshold for copyright in photos—a different standard for socially important events.  Uniqueness also might argue for copyright: we are all unique and therefore our photos must be original.  (Original to whom?  I haven’t done a lot to my own appearance, other than correcting nature’s mistake in failing to make me a redhead.)

Prof. Llewellyn Joseph Gibbons, University of Toledo College of Law

Love’s Labor’s Lost: Marry for Love, Copyright Work Made-for-Hire, and Alienate at

your Leisure

Congress worried that the Soviet Union would enter the CCC, expropriate dissident authors’ copyrights, and then try to suppress them in the US.  Chances of this were slim to none, but Congress amended the law anyway to bar a government from expropriating a copyright unless it had already once been voluntarily transferred, except in bankruptcy.

Is marriage alienation?  Is it a transfer of copyright in a work that does not even exist yet?  How can that be a voluntary transfer?  According to one case, living in California may constitute consent to its community property regime—but in that case wouldn’t living in the Soviet Union constitute consent? (Emigration from the Soviet Union was not voluntary, though, as I recall from many a “free Soviet Jewry” sign from my youth.)

Rodrigue v. Rodrigue, LA: a little bit of preemption, not enough to preempt Louisiana marriage law.  Court made up its own analysis. Distinguishes right to use, right to alienate, and right to enjoy the fruits of use.  Author-spouse retains exclusive managerial control of copyright, but has to split economic benefits of copyright with the community.  What happens when the artist continues to create in his own style?  When is there a new work and when a derivative work of the community property?  Also court suggested a duty, in dicta, to manage copyright for the benefit of the spouse.  Can stopping creation of derivative works, or exercising moral rights under §106, interfere actionably with the economic value of the works shared with the ex-spouse?

Proposal: get rid of marriage and think only of partnership.  Marriages exist and produce external & internal consumption items.  Some workers are highly skilled at selling stuff external to the marriage, others are skilled at household work; they can trade for the benefit of the family.  Would that make a copyright work created during the marriage a WFH/partnership asset?

Prof. Marc H. Greenberg, Golden Gate University School of Law

Creativity Constrained: Comics and the Law

Book project.  Start in 1954 with Seduction of the Innocent, in which Frederick Werther suggests that comics cause juvenile delinquency.  Led to book-burnings and congressional hearings.  Outcome: Comics Code Authority, voluntary guidelines adopting censorship.  Underground comics led to obscenity prosecutions; birth of the Comic Book Legal Defense Fund.  Had a case where a comic artist was ordered not to draw comics for years as part of a resolution of an obscenity case.  His view: SCt was wrong to allow obscenity prosecutions as outside the First Amendment.  New cases: personal possession—when they search your laptop at the border; Stanley v. Georgia allows personal possession but the law bars transportation, so how do you get it? Apparently create your own.

Another big topic: termination rights. Who owns Superman?  Comics companies argue that all these artists’ work was WFH, though heirs got Action Comics #1 and some strips back at the district court level.  The WFH doctrine was changing/evolving during these pre-1978 transfers, creating many puzzles.

Copyright and characters.  Issues arising from blended nature of comics: comics as sequential art.  Storytelling through graphics and text.  Cases deal with the separation of the two; law has real difficulty dealing with them together.  Even in a tax case!  California exempted “authors” sending manuscripts to publishers from definition of sales, but art sent to publishers was a sale.  So which was a cartoon?  Similarly, in an obscenity case, defendant was prosecuted twice for the text and the art in the same work; prosecution said they were different works.

Prof. Doris Estelle Long, John Marshall Law School

Have Copyrights Become the New Anti-Competitive ‘Monopoly’ in the Digital Universe?

Relationship between antitrust and IP.  Past perception that “monopoly” conferred by copyright was very different from a market perspective than the monopoly conferred by patent because of substitutes.  Computer software changed the nature of copyrighted works, as did digital communication.  Result: change view of copyright’s anticompetitive potential. Also why we need to theorize copyright separately from patents under antimonopoly laws. Types of activities giving rise to claims of abuse aren’t similar work- or patent-based claims. Except for software, books don’t fit.  People don’t walk into a bookstore looking for Harry Potter & walk out with Hunger Games.  (Speak for yourself.)  There’s no substitute, but at the same time it doesn’t fit standard antitrust thinking.

Borrowing from patent to copyright often works very badly, and likely to do so with antitrust as well.  Essentiality of copyright—a particular work—is based on its communicative aspect: I need parts of this work to make my own.  Fair use and other limitations already protect that communicative aspect.  Copyright has also developed doctrines about market efficiencies. If you’re talking about needing a work to communicate, that’s communicative essentiality; that’s not antitrust.  Antitrust analysis can be helpful with “distributional” essentiality where copyright enables market dominance.  Where there are switching costs, network effects, etc.—Microsoft v. Apple. First sale, home taping, personal use can also benefit from the concept of distributional essentiality.  Who gets to set the prices for items being sold?  An up-and-coming issue. If you argue that something is being abused—dominant position, essential facility—that language shows up in this area; just be careful not to overlap with communicative essentiality.

People who have the ability to control massive amounts of copyrighted materials can control markets.  Access to wide bodies of works: in the 1940s, motion picture companies controlled access by controlling movie screens; this can fit into antimonopoly analysis.  Ability to abuse an “operating system.”  An essential facility is not the same as an abuse of the market, and we should distinguish them; there is no piece of music that qualifies as an essential facility. Rather it’s software/tech access that pose potential of creating essential facilities. Bayer decision in India shows role of price differentiation where IP is considered essential; we need to theorize the boundaries now and focus on competitive issues as they relate to distribution.  Deal with communicative essentiality separately so as not to muddle the process.

Prof. Liam O’Melinn, Ohio Northern University Pettit College of Law

The Mythology of Common Law Copyright (previous WIPIP version)

Why didn’t Congress address the constitutionality of protecting sound recordings straight-on? Mythologies.  In Golan: Falzone was asked whether the public domain was a substance of its own, or just what happened to be there when things fell out of copyright?  Falzone said the latter.  Was there a public domain before 1790?  Falzone said yes, which was a consistent litigation position, though possibly not wise. Those are strange questions and answers betraying fundamental confusion about the relationship between copyright and the public domain.  Wants to show how common-law copyright thinking has influenced thinking up to today.

Censorship preceded copyright and ultimately gave us the Company of Stationers, who thought that the works that had been their property were still their property after the Statute of Anne.  Result—invention of the author?  A paucity of authors, an abundance of manuscripts circulating before and after the invention of the printing press.  One theorist thought that authorized manuscripts were “good” texts, properly printed, so that unauthorized texts derogated from a norm of permission.  Piracy = bad literature. Respect for norms = good literature.  This story is that long in advance of Statute of Anne (Shakespeare) people were collaborating in this way; O’Melinn thinks that this is pretty fanciful, but contributed to the mythology of common-law copyright.

Other authors talked about this over time: Jonathan Swift said there was no common law copyright in Scotland.  What about America?  His research suggests that Ben Franklin knew of Donaldson v. Beckett, and it seems likely that this was the common American understanding.

Comment for O’Melinn: with pre-1972 sound recordings, you have collectors today collecting cylinders with no clear understanding about what copyright law protects; doing it anyway because of lack of enforcement/perceived lack of market.  With no remedy and no reason to claim rights, myths persist about what the rule is.

For Gibbons: housework can be analogized to back office work supporting the “author.”  Changes the analysis because the author couldn’t be an author were it not for the fact that the spouse is taking care of other issues.

Gibbons, to my comment: I don’t believe living in Louisiana is a choice to a particular property regime with respect to copyright.  But Congress had a statute in search of a problem.  Rodrigue was bad because it’s imposing a common law trust on civil law, and because it’s unique to Louisiana; no real cites/discussion to actual Louisiana law.  So it’s a weak model on its own terms.  Could get rid of §201(e); could have a pre or post-nup.

Yu: for O’Melinn, when you talk about Shakespeare you seem to lump customs and common law together.  Isn’t it worth distinguishing a custom from something that could actually go to court?

O’Melinn: understands custom as source of common law, at least if law ultimately vindicates.  Trying to be fair to people who believe in the common-law authors’ right even though he doesn’t himself believe it.

Q for Corbett: consider the commodification/anticommodification literature—you seem to be choosing commodification.  Maybe the answer is that the photographer has already done that.  Second, what control does joint ownership give to the subject? In the US, either joint owner can license without the other’s permission, so the only control would be over exclusive licensing.  Note that in the US we already blur out TMs often, but not the faces of the crowd.

Corbett: thinks the photo is already commodified because the photographer already has the right.  (Though will often in these objectionable scenarios not be commodifying it, merely sharing it.)  US law is different; in NZ joint owners have to agree.  (Can agreement unreasonably be withheld?)

Liebler: Greenberg focuses on US law, but that’s difficult to do because the obscenity cases are often comics from other countries. Border control/US citizens’ travel are often at issue.  Bring in some unlicensed comic uses—scanlations—and how that works in the US and may stimulate distribution chains in the US.

Greenberg: It’s a multivolume process!  These are important aspects.  Japanese authors are very interested in US attitudes.  Much difficulty seems to be cultural misunderstandings.  In one case, a manga/anime obscenity case, they brought in trial experts on the cultural significance of the genre, and the court wasn’t interested in hearing about artistic/cultural significance.

Me for Corbett: there’s uniqueness, but who’s the origin?

Corbett: My image is personal to myself, unique to me.  We could say that about anything, though; any book owes its creation to other influences on the author. 

Me: why the image then and not the biography? Both owe their existence to the uniqueness of the subject.

Corbett: images are different; the creation of the photo isn’t entirely from the photographer; the subject contributes to the ultimate work. Copyright only covers what the writer adds. 

Me: but that’s just to say the next photographer and the next biographer can make their own representations of the subject.  (The writer didn’t add the facts and doesn’t own them, but neither does the subject own them even though the subject is a but-for cause of the biography as much as she’s a but-for cause of the photo.)

Gibbons: maybe an interest in concealment/private facts.

Greenberg: maybe a person has an interest in their own biological material if used to develop a cure.  (But a copy is not the original.  If I set a photo or a biography on fire, the subject doesn’t get burned.  So the physicality of it can’t be the dividing line between photo and biography.)

Greenberg: character copyright analysis may be taking a step forward with Superman, since DC will own what it created during its ownership; heirs can’t use anything created by DC, and DC can’t create new derivative works without heirs’ consent; this will shape how the character is defined.  It’s the heirs and not the creator, making this particularly interesting. 

Q: does common law copyright mean a right of publication, or something else, in this period?

O’Melinn: More than right of publication, or state common law copyright; instead discussing a theory presented as if it were law that said that before there was a statute there was perpetual protection surviving publication. This theory’s vagueness is its advantage for proponents.

Student IP writing competitions

Georgia State, deadline April 30.

New Hampshire/Franklin Pierce, deadline May 18.

Drake part 4

Panel 4: Intellectual Property Law II

Prof. Yaniv Heled, Georgia State University College of Law

How Abortion Politics and Technophobia Created the Distinction Between Patentably Non-Human and Patently Human or Why Congress Desperately Needs Scientific Advice

1987 PTO policy: claim directed to or including a human being won’t be considered patentable subject matter.  But what is a human organism or human being?  As it turns out, this is quite difficult to figure out. Transgenic animals wouldn’t be human, nor embryonic stem cells, according to the drafters.  Human-animal chimeras would be (human and animal cells fused).  By implication, humans having one or more genes derived from a nonhuman source.  Human clones are an unclear case.  Had trouble drafting about what they didn’t like.  An animal with a few human genes = not human; human with few animal genes = human.  But is it at the chromosomal level?  How many genes?  What about animals designed to have human characteristics—a golden retriever with a big brain, or a chimp with a human voicebox?  (Is it physically feasible to approach this dividing line?)

What about human/machine hybrids?  Implantable memory extensions—following up on cochlear implants, which already exist.  What about brains in vats?  (Does this matter if method/machine patents for the nonhuman parts are available?)

Sentience should be the line.  By definition, humans can’t have a utility/use as per Kant; Thirteenth Amendment.

Why should we care?  Because at some point, someone is going to use this policy as a defense when the patent is one we want to encourage.  Section 33 was passed without scientific input; sets bad precedent for regulating science through patent law.

Prof. Kali N. Murray, Marquette University Law School

The First Amendment in Patent Law (with Prof. Erika George, University of Utah School of Law)

Others have addressed this topic. Douglas and Breyer construe patents as monopolies, and that has implications for how we think about speech.  Both look at using these types of speech harms to broaden the standing of parties to challenge patents.  There’s a struggle in patent in the 1940s that affected patent institutions and doctrine; Justice Douglas lost, though perhaps Prometheus indicates that his perspective has now prevailed.

When we talk about constraints on patents, constitutional tradition is much richer than we usually recognize. The US tradition is torn between patents as constitutional property and patents as limited monopolies.  Social obligations of the property owner to act in responsible ways: speech claims can be premised on access.  Myriad: a set of access claims predicated on relationships generated by patent.  One claim was that Myriad rejected a patient because it didn’t want to deal with Medicaid; a property owner might have an obligation to grant access v. having an unaccountable monopoly. 

(I’m not sure that any of this directly matters after Golan, since the Court is obviously uninterested in speech claims even as to copyright.)

Prof. Mark Schultz, Southern Illinois University School of Law

Intellectual Property and Liberty

Herein of copyright and patent.  Familiar arguments over property’s relationship to/support of liberty and their relation to IP.  Though property may not always be the same as IP, the analogy is relevant. 

Common justification for property is that it promotes liberty as well as social welfare.  Three general arguments: Property promotes autonomy; promotes the existence of a private sector where people can arrange their own affairs/collaborate with others; disperses power and enables people to have a political voice by giving them a means to participate. These are consequentialist arguments and should be understood on that basis.  (Key here: Property the institution or citizens broadly having property?)

Property as independence.  Locke; found in development economics, e.g., Amartya Sen.  Access to things people need to flourish as human beings: security of income, ability to secure credit to cushion economic shocks; less dependency on others/employer/government/landlord.

Creators can be disruptive, threatening: they need economic independence to do so. Property right provides at least a place at the table to offer some independence even if the creator sells that right. Don’t need to worry about pleasing powerful patron.

SOPA debate was impoverished by rhetoric on both sides.  Cartoonish economic argument for the law; the argument against was largely focused on liberty v. economic interests. Reasonable dialogue would include liberty interest at stake for creators.

Doctrinally: when we focus on the importance of independence to individual liberty, we have to look at default doctrines of ownership in copyright and patent. Never hastily infer work for hire arrangements.  Don’t allow corporate inventorship; at least they get the initial right that grants them some power.

Private action: property allows people to collaborate freely, exchange/engage in private ordering.  IP works similarly.  Property rights allow inventors and creators to collaborate and to walk away.  Copyright allows open source licenses and other forms of collaboration.  Every license is its own unique form of collaboration that people have freely come together to choose.  (Really?  My iTunes agreement?  This seems like formalism; I have equally agreed to the rules of the US by not emigrating, but I have a much better chance of changing those rules by voting than of changing the iTunes rules by negotiation or even by voting with my delete button.)  This argues against compulsory collective licensing.  ASCAP etc. are private associations, much more desirable than SoundExchange.  (I wonder how many songwriters seeking to get paid think they have a choice to enter into a relationship with a publisher and a CRO.)

Political power: many criticisms of copyright industries.  We should remember that it is those same economic entities that often defend the First Amendment and freedom of inquiry in the legislature and the courts—NYT v. Sullivan; the NYT depends on ownership of copyright to protect freedom of expression.  (Except: the NYT demands WFH etc. from its freelancers!) 

Prof. Lars S. Smith, Louis D. Brandeis School of Law, University of Louisville

Patent Liability in the Cloud

Can a defendant be liable for providing part of a system covered by a patent?  Or a method, where different parties are responsible for different steps?

Centillion Data Sys. v. Qwest: a system for finding phone bill on line; P has patent for system for finding information online.  Can a user be liable?  The patent is drafted as a system with a back end and a front end. The back end is the tech: storage, processing, transferring data. Front end is the user/personal computer data processing.  Court in NTP said use of a system where part of the process happens in Canada is use in US if that’s where the system as a whole is put into service.  So the party must put the invention into service: control it and obtain a benefit from it.

In Qwest, the question was what happened when different people control different parts of the system. Court says that putting the system into use and obtaining benefit was enough even if there wasn’t control. Thus the client is an infringer.  But Qwest wasn’t liable because it didn’t put the service into use: they provided only the back end.  Are they vicariously liable? Court says no, because they didn’t have a relationship with the customer over the operation of the system—don’t tell the customer to do so.

What about with a method patent?  Akamai v. Limelight, still pending en banc at the Federal Circuit.  Actions of multiple parties combined: the question is whether the claim is directly infringed only if one party exercises agency control over others.  Alternatives: “directs or controls” standard; actual or constructive knowledge that the acts are being carried out.  Many method patents involve multiple parties—e.g., if one party tags the content and the other party uses the tags to do something.  A number of patents are written in such a way as to involve multiple parties and are therefore not infringeable.

McKesson v. Epic: a patent on a method of automatically and electronically communicating between at least one health care provider and a plurality of users serviced by the provider.  Epic is the seller of the software, but the patent deals with the users.  Epic has no direct relationship to doctors or patients.  Alleged direct infringers are the patients.  Can you be contributorily liable for part of the process?

If the court is right that a single entity is required for infringement, based on principal/agent law, that will exclude a number of important cloud computing patents—valid but unenforceable.  That doesn’t make any sense.  He predicts that the en banc court will incorporate common-law doctrines into law to deal with this.

Patent attorneys say that this is dumb; properly drafted system patent gets rid of this problem.

Q for Heled: is uncertainty a feature?  Maybe we like people staying far away from what might be a human being.

Q for Murray: difficult to think of Breyer winning in patent when he obviously lost in Golan.

Murray: Take into account the history of the First Amendment within IP as a whole.  From 1880-1952, for patents as well as TM and copyright as well, there is a problematic constitutional history that we’re not articulating well.  Eldred gives some space because Ginsburg distinguishes patent as a monopoly from copyright.  But Golan makes that harder.  Ginsburg is an important figure because she deferred a lot to TRIPS. If these are international IP cases, they become more important, showing tension between constitutional law and TRIPS.

Liam O’Melinn: Skeptical about Schultz’s transition from property to IP.  Real property is stable. IP is unstable, and increasingly so.  Problem with legal system is protecting that instability.

Schultz: We have lots of institutions that are designed to prevent the accumulation of hereditary power, such as real estate taxes; nuisance doctrines; alienability rules.  Thus having an expiration date on property isn’t as surprising as you might think.

My criticism of Schultz is related to O’Melinn’s: Along with the question of property rights v. having property, IP has only relational value; land is more likely to be distributed/distributable in a way that allows people to sustain themselves.  I was just reading Tasini v. AOL: he was unable to get the terms of exchange he wanted.  Hard to think of property as development in Sen’s terms unless you also think about an underlying access right so that everyone gets an initial allocation of some value.

Schultz: debate over whether land has value until humans impose their will; diamonds have no intrinsic value, nor does undeveloped land. Development often requires collaboration.  (But I’m not talking about undeveloped land, nor do I think Sen is.)  He is aiming at the argument that IP is concentrated in corporate interests. But the creator’s initial right gives him/her some leverage in negotiations.  In land reform too, the ability to alienate/mortgage can give people some amount of economic independence.  (Right, but in the development context this usually requires the state to hand out chunks of land/reform ownership procedures in the first place.  What I want is a better origin story: is this really about the idea that if you are the creator you should be the owner, and isn’t then a key question as against whom?)

Does mean liberty in the sense of positive liberty/personhood but worried about muddying the waters.

Drake, part 3

Panel 3: Intellectual Property Law I

Prof. Sarah Burstein, University of Oklahoma School of Law (beginning fall 2012)

In Defense of Design Patents

Ralph Brown called design patent a Cinderella who never goes to the ball; today she calls them the ugly stepsisters who everyone loves to hate.  Standard critiques exist in the admittedly small literature.  Wants to challenge those critiques.  They obfuscate the real issues with design protection.

Industrial design is her focus, though many arguments go to fashion. 

Critique #1, Design is Art!  Either design is like sculpture, or it’s so much more like sculpture than like building a new machine that we should use copyright. Problem: industrial design is a lot broader than a gorgeous Phillipe Starck chair.  It includes a “mailbox bolt,” which goes into a larger design. Do we want to protect “art”?  The products of industrial design?  Something else?

Critique #2, we (only) need anticopying protection.  Narrow protection is better to avoid overprotection of patent.  In re Laverne: two bowl chairs (prior art).  Copyright has access/similarity sliding scale.  But design patent is industrial design and thus will generally always have high availability/access, thus decreasing the amount of similarity required to find infringement.  In Laverne, copying wasn’t an issue—the issue was whether the prior art rendered the applied-for design obvious.  Narrow scope of design patent exists now.  Both of these designs are important design icons and the second comer shouldn’t be discouraged.

Critique #3, patent requirements are not “appropriate” because they’re too expensive, take too long, too difficult to satisfy.  Maybe the system should be more patent-like.  Design patent applications aren’t published prior to issuance, and can’t get pre issuance damages; we could require publication and allow pre issuance damages.  Are we really interested in incentives?  Or do we want to reward authorship?  That’s the question that has to be answered first.  Some argue that the best designs, from midcentury minalism point of view, won’t get protected/can’t get patents.  But she’s never seen an example of a rejection because of its strict adherence to minimalism. We haven’t talked enough about specifics.

Big issues: ex ante v. ex post examination; property v. liability rules; what do we want to protect, exactly; also how the design patent system relates to product design trade dress protection.

Raizel Liebler, John Marshall Law School

Be the Brand: Required Involvement in Social Media

Red Cross: tweet by staffer was personal, discussed drunkenness.  Red Cross reacted well: deleted the “rogue tweet” but assured everyone that the Red Cross was sober.  The beer brand mentioned in the rogue tweet also took advantage to promote itself & donations to the Red Cross.

Chrysler tweet: “I find it ironic that Detroit is known as motorcity but no one here can f—ing drive.”  Staffer and agency were fired.

AARP tweet: “We miss you, Biggie.”  Not exactly the AARP’s target audience.

Kenneth Cole tweet, not an accident: mentioned Egyptian unrest: “Rumor is they heard our new spring collection is now available online.”  Became quite controversial.

Gilbert Gottfried, AFLAC duck voice, posted controversial tweet about Japanese tsunami and was subsequently dumpted as spokesduck.  Baseball player’s tweet during spring training got him in trouble.

Other risks: disgruntled employee could erase or deface the brand’s page.

Legal issues: FTC regulations, copyright/trade secrets, employment/contract/NLRB, right of publicity, privacy, moral rights (outside US). She is most concerned with allowing employees to have personal lives outside the workplace, especially those whose jobs include doing social media and may be expected to be on call/tweeting all the time.  Also concerned with employers, public, celebrities.

Maremont v. Susan Fredman Design Group—employee hospitalized in accident, but company wanted to continue tweeting from her account, and did post on her account without her permission.  Can’t tell which tweets she actually posted.  (Liebler says real v. fake but it’s not clear to me this is the proper characterization.)

Linedrawing difficulties, especially in an age of flexible employment.  What happens when an individual has many Twitter followers and switches employment—is it wrong to “take” them?  Happened with a BBC employee who switched networks; BBC did not act (but person changed her Twitter name to take “bbc” out and put new network name in).

Prof. Emily Michiko Morris, Indiana University School of Law—Indianapolis

Artifice and Action in Patentable Subject Matter: A ‘Common Sense’ Approach?

We have intuitions; unpredictability is the complaint, but she believes there’s a common thread in intuition.  Artifice and action combined are recurring themes.  Artifice means: the result of ingenuity; humanly contrived, human-made.  Action: something active, does something or performs some activity.  Does more than just exist.  Seen in the “machine or transformation” test before Bilski.  Invention must behave, operate, function.

So you see questions about whether something is artificial enough: Diamond v. Chakrabarty.  Also, some things don’t do much more than exist, so courts are reluctant to see them as technological/function-performing.  These concepts are hardly unique to patentable subject matter and correlate with utility and obviousness, and also enablement. But in conjunction they seem to underlie PSM.

Not arguing that this is the correct answer.  She thinks the Constitution poses an empirically impossible question about what promotes the progress of the useful arts. But still it’s a relatively consistent theme.

Laws of nature/algorithms: not artifice.  Perhaps it’s not Lockean labor, perhaps it’s not progress, perhaps there’s an aversion to propertizing nature/naturally occuring phenomena.  Overbreadth is another concern—overbreadth underlies all of patent law.  Laws of nature/algorithms also flunk the action requirement; action is not utility.  A law of nature or algorithm may have a purpose/use, but it is unlikely to be “active.”  Copyrightable subject matter is useful, but it doesn’t do anything itself.  It exists, it informs us, but it doesn’t “work.”  (This seems to me to skip over things like performative utterances.)  Laws of nature are like that too.  Abstract/vague ideas: not artifice, maybe, because they might not have existence prior to human creation; courts also refer to laws of nature as abstract. The real failure is action: lack the specificity necessary to accomplish something, they only indicate what the inventor would like to accomplish.  Enablement is an issue too in these cases, despite showing up in PSM.

Machine or transformation test: SCt rejected this as exclusive test for processes.  Transformation is clearly “action.”  Machines/compositions of matter/manufactures—can be seen as active, doing more than existing.  Machines are clearly non-human; is transformation non-human/artificial?  Her concept also helps explain problems with mental steps; printed matter doctrine; business methods; computer software; diagnostic methods.

Prof. Rebecca Tushnet, Georgetown University Law Center

The Eye Alone Is the Judge: Images and Design Patents

Fear of images is common in law, resolved by two contradictory and unpredictably deployed concepts – the image as transparent representation of reality and the image as opaque and non-dissectable fact in the world.  Courts lean towards one concept but find themselves appealing to the other when difficulties emerge.

The key problem with respect to the scope of design patents can be briefly stated, though not easily resolved: Many designs involve non-novel or functional features, and are only protectable because of other novel features, or because of a novel combination of otherwise familiar features.  But if the overall effect of the design on the eye is the measure of infringement, how are factfinders to avoid potentially broadening the scope of the design patent too far when an accused design looks like a patented design because of similarities in these unprotectable features?

Problem comes up in copyright too, e.g., the Franklin Mint case where a bird painter painted three different versions of the same scene, and the second was held not to have infringed the first because the similarities derived from the genre.

Well, can we specify what’s different about a design as compared to prior art by explaining using words?  Or by using words to sort out what part of a design patent has utilitarian functionality?  We can try, but we then confront the problem of words and verbal overshadowing.

The problem of uniqueness.  Uniqueness—distance from prior art—is the standard in design patent, which itself can give us some insight on why it’s not the standard in copyright, which has an idea/expression distinction. This means that even if you have a unique idea—you’re the first one to come up with a story about resurrecting dinosaurs out of insect DNA—you don’t have a monopoly over that idea, only rights to your particular expression of it.

A further problem created by protecting uniqueness: Triangulation.  What happens when a design is similar to prior art, but also similar to patented design.  Which penumbra is the accused design within?  Visual inspection will not provide answers; instead we need some normative idea of what we’re protecting and why.

Shontavia Johnson: For Liebler—what are the First Amendment implications?  Even if you sign a contract with a morals clause, can an employer/endorsee control all your speech?

Liebler: In the US, we’ve pretty much said you can contract away your rights within the scope of employment. The issue for her then is whether the contract is acceptable.  At what point is someone outside the scope of employment?  Social media makes that line particularly difficult to draw.  Do you have to announce to your Twitter followers that you’ve changed jobs?

Q for Burstein: Time may matter – design patent may take time, but gives you certainty of timing; compare to trade dress, which requires time to acquire and may be lost.  So design patent gives certainty but may also overprotect.  Should SCt worry about design patent overlapping TM rights, given Dastar?

A: she thinks trade dress is the problem, not design patent.  Dastar is about authorship masquerading as trademark.  She’d rather cut back on trade dress than design patent.  Tests for secondary meaning are overprotective for products—very hard to distinguish between ‘I recognize this as an iPad’ and ‘I view this primarily as an indicator of source.’ 

Q for Morris: how does this work for a composition of matter?  Prometheus: trouble distinguishing between lab work and law of nature.

Morris: even compositions of matter will do something if they are patentable: a drug will have biological effect.  Action requirement is fairly low.  Could have a composition of matter that works as a paperweight: perform the function of holding paper down.  But artifice has to be product of human activity, not human activity itself. Intuition: Human thought can’t be propertized.

For Burstein: In New Zealand, don’t have copyright protection for industrial designs, but do have registered designs. For local people, they rarely use registered design; use copyright instead. Term is reduced to 16 years. Similar to patent protection.

Boone: ask about 3-D printing. If designs can suddenly be copied, does that change the calculus about what the law should be doing about design patents? 

For Liebler: is this a conflict between agency law and how the sites are coded, or is it just a situation where the companies haven’t figured out how to do it right?

A: yes! It’s complicated because it’s new. If before the relationship starts everyone thinks about what happens if the employee quits or is fired, everything will be fine, but that’s not what happens. Mostly it’s “we need a Twitter spokesperson” and if a part-timer starts it, as in the PhoneDog case, then things get entrenched.  If he’s the only one with the password and can change the account, that creates a legal issue.  Facebook: FB doesn’t allow a corporate owner of a page; has to be connected to a real person. If a disgruntled employee leaves, s/he could erase that page.

Yu: for the Franklin Mint paintings, when the painter drew the second and third painting, he also had the memory of drawing the first.  Why isn’t that enough to infringe?

RT: Yes, of course copyright recognizes unconscious copying and ordinarily we’d say his memory was enough.  Instead there must be some underlying idea about allowing him to be free to continue painting in his chosen style (which was Audobon’s style).  This is a rationale that can’t be gleaned just from looking at the pictures, which do look a lot alike.  There is a gap between explanation and outcome.

Greg Vetter: what would you show the jury beyond the pictures—market information? That’s not how utility patent infringement is done.  Contextual infringement analysis would be resisted by people from the utility patent side out of fear of creep.

RT: true, though design patent is already different—the drawing is the claim, not the words, which is not how it works in utility patent; you don’t have to construe the claims to make sure they read on the accused device because you evaluate similarity overall. 

Q: What’s the lesson for copyright?

A: uniqueness isn’t right for copyright, though it may be for design patent.  Samson Vermont has a paper on this I find intriguing but ultimately wrong.

Benjamin Liu: you used to have to submit an exemplar with a utility patent; we then decided to embrace the word in the utility patent, and even denying the relevance of drawings in the utility patent.  What is at stake for that choice?  Why not embrace verbal overshadowing?

A: Lawyer dominance?  Verbal overshadowing simply distorts outcomes; can also favor plaintiff by allowing framing of similarities as predominant, though even if there wasn’t systematic distortion there’s still distortion that is worth combating if we can figure out how.

For Burstein: should we have a doctrine of election between copyright and design, as with some other nations’ regimes?

A: that’s missing from many proposals. (Not from Mark McKenna’s!)  Worth considering: give someone 10 years of protection but then they’re done.

Q: people designated to be the brand: (1) intentional hijacking; (2) mistake (tried to tweet from personal account).  Can contracting get around that?  Make a condition of employment that the account belongs to the company.  (Consider FB’s position on making employees share passwords on this—FB threatens it’s a violation of CFAA, which seems wrong but is aggressive.)  Could tell a person that they can’t have another social media identity, and thus couldn’t mistakenly tweet in the other identity.

A: doesn’t see it as realistic, especially the second: when someone is hired to “be the brand,” they’re often chosen because they already have a presence—many job descriptions require a certain number of Twitter followers to be considered.  Sometimes the line is blurred; sometimes they start a new feed but start from scratch.  Another way to address mistakes: someone could only use certain devices while they’re working—two phones, two computers.  Many businesses have multiple official Twitter accounts.  Mistakes are likely to be inherent.  It’s hard to contract away the possibility of mistakes.

Q: Procedure matters in how we apply the infringement test.  Arnstein and analogy to copyright: the two-part test there is supposed to be expert and then lay.  PHOSITA in patent seems very different. Other way to go is to protect markets: take what’s pleasing to the viewer more seriously. Look at how the market reacts.

Boone: Dealing with verbal overshadowing—a lot of that happens with claims in patent cases. Is there a comparative study for what happens in a TM survey?  Or is that subject to the same problems?  (I think it would be, because the questions you ask shape the answers, though controls may be able to account for some of that. I don’t know if there’s a way to replicate that in patent, though with design patent you might be able to show people in the control group the prior art and the accused design.)

Drake, partial part 2

Panel 2: Patent Law I  [my apologies; had to step out during this]

Prof. Joshua Sarnoff, DePaul University College of Law

Governmental Innovation Mechanism Choices (with reference to Climate Change)

Patents and IP rights are part of national choices for tech development, a decision set which also includes direct development and investment.  R&D can provide push (demonstration and stimulus for market development with reduction of risk of market entry); pull mechanisms can assure scale for private R&D investments and decrease market risks through contractual mechanisms, including terms about ownership of IP or nonrestrictive licensing of IP.  Trade concerns include discrimination favoring local industry.  But the basic issue is that we just don’t know whether and in what forms these mechanisms are effective.

Direct development: national labs; integovernmental collaborations.  Again, empirical knowledge is uncertain about comparative benefits.  Direct and indirect subsidies (tax treatment), production/market subsidies; foreign aid can be thought of as a subsidy.  Market distortions—oil and gas subsidies.  Again, trade concerns about preferential treatment.

What else encourages/discourages entry into a market?  Recognition and certification; disclosures; private industry measures compelled by threat of market intervention.  Other possibilities: nationalization; “crown use”; operational controls like provision of service mandates and interoperability mandates; entry and merger regulation; price controls; statutory and compulsory licensing.

Natural experiments?  Bayh-Dole replicating around the world, but it’s hard to compare because people aren’t trying alternatives.  Governments could explicitly try different options in different sectors or markets.

Prof. Shine Tu, West Virginia University College of Law

Unluck/Luck of the Draw: An Empirical Analysis of Examiner Allowance Rates

Anecdotally, some examiners are known to be tougher than others; saw an examiner take pride in 0% allowance rate.  Us v. them attitude.  Study attempted to quantify behavior by coding every issued patent over 10 years, about 1.7 million.  Backlog was nearly 700,000 as of Aug. 2011, and number of applications has grown to over 500,000 in 2010. First office action pendency is 27.2 months. 6775 examiners at PTO; $1.4 billion. Are we getting our money’s worth?

Primary examiners (more than 5 years experience) allow many more patents than secondary examiners (less experience/don’t have signatory authority); take less time to issue patents; a significant proportion of secondary examiners have a very low allowance rate, less than 5 patents/year.  Significant proportion of primary examiners have very high allowance rate, more than 50/year for 3 or more years.

Allowance rate 1993-1999 was 66%, and now 54% according to PTO. Adjusting for continuations, one study says 85%; other studies estimated 47% and 68-78%.  There is no “correct” allowance rate since the standard of patentability has to be met.  His rates match up with PTO’s; not corrected for divisions and continuations.  Examiners get less time to review patents as they gain experience.

Is the “add new examiners” strategy going to work?  Doesn’t seem like it from the data.

What about litigation analysis? Tried to match litigated patents with examiners, found about 2100.  Overwhelmingly, primary examiners were issuing patents that were litigated.  Weighting by # of patents, though, we see different results—primary examiners sometimes do better and secondary examiners sometimes do better. 

Prof. V.K. Unni, Indian Institute of Management Calcutta (India)

Evolution of a TRIPS Compliant Patent Regime: Learning from the Indian Experience

India initially had barriers to foreign trade and foreing investment, in the interest of self-reliance.  In 1991, India almost went bankrupt.  WTO/TRIPS entry followed.  The main effect was on patents, not copyright/TM/designs.  Many Indian pharmacos developed expertise in reverse engineering.  But with TRIPS becoming fully effective in 2005, Indian companies had to retool to survive. Many were active in the US market.  Explosion of patent litigation, including over the concept of inherent anticipation, which comes up in a lot of US/UK pharma cases as well. 

Some Indian companies are still aggressive believing they can strike down a pharma patent.  Voluntary licensing is less common because patent holders impose restrictive conditions. Recently, March 9 case, the patent controller issued India’s first compulsory license for a pharma product—an anti cancer drug.  Finally, Indian companies target the US market with ANDAs.

India has fully complied with TRIPS, demonstrating that full compliance can coexist with flexibility.

2012 Intellectual Property Scholars Roundtable, Drake University Law School

Panel 1: Copyright and CyberLaw

Prof. M. Scott Boone, Appalachian School of Law

Virtual Property and Copyright: Taking the First Sale Doctrine into Virtual Space

General concept: apply virtual property/object theories originally developed in connection with virtual worlds to first sale.  Copyright Act speaks of “property rights in any material object,” §202, and also “computer programs,” §117.  The latter was designed to protect ordinary user rights, starting to capture the idea of a virtual object which isn’t necessarily just one iteration of code sitting in RAM or sitting on the hard disk. The object is the combination of the functional software with the data with the copies in multiple places that together allow the user to do something. That’s the underlying idea anyway.  Those things shouldn’t be treated separately for purposes of infringement, because they work together to create one usable object.

Barrier: contracts. A license isn’t a transfer of ownership, and thus first sale doesn’t apply to avoid distribution liability even if there’s no reproduction. One possibility: revise §109 to add in rightful possessors, or a principle of mutuality—whatever user gets from copyright owner, user can transfer.  Copyright owners argue that they retain power to terminate licenses, even though they never really intend to do so.  Some software might be linked with a service and we wouldn’t want it transferable—might want an exception for such cases where it’s really a personal negotiated relationship instead of a sale of consumer goods.

Second problem with contracts: restraint on alienation; can still add a contractual promise not to distribute even if it’s not a license.

Barrier: technology.  DRM can prevent transfer; legal restraints on circumvention.  Need §109 for §1201?

Prof. Thomas C. Folsom, Regent University School of Law

Property concepts can change with code: if X sells poisoned flowers and Y doesn’t like the petals drifting over her fence, one must give; but if X can code the flowers to be nonpoisonous unless they leave the property with her permission, then both can win.  Code allows performativeness: can change reality immediately upon utterance.  There should be degrees of coded exceptionalism.  Build code to manage people’s relationships to focal points (Superman, the Eiffel Tower) that shape their decisions.

The Magician’s Horse: Designing Code and Other Laws Beyond Cyberspace

Prof. Jon M. Garon, Chase College of Law, Northern Kentucky University

Legal Education in Disruption: Headwinds and Tailwinds of Technology

Disruption: when change is choked off, the ultimate change is even greater and more disastrous.  Disruptive tech, etc.; globalization, pressure on state from ability of individuals to communicate; ability to aggregage/disaggregate info in cloud culture, including Facebook; internet of things, RFID chips; network effects creating real winners and losers from being on or off the dominant system—all triggers for disintermediation.  Globalization is also affecting law; BigLaw is where most people have focused on—huge economies of scale/control are possible so that consolidation of power in corporations is mirrored with law firms providing similar services. His focus: the bottom of the pyramid—software, self-help dramatically changing the environment.

2/3 of legal services have moved to corporate clients, who are more price sensitive. Most model rules are designed to protect the individual against the lawyer; the bargain is not as skewed with 500 lawyers in-house.  Lawyers as gatekeepers to info have fallen out of favor and we’re in a self-help world; costs of legal services have become incredibly difficult to pay and the value proposition is hard to justify if you can research it yourself.  Texas courts tried to block software formbooks but the legislature struck back. We’re only self regulated when the public wants us to be.

Money is coming to legal forms: Kleiner Perkins invested $100 million and Institutional Venture Parters invested $41 million in LegalZoom; Google has invested; FindLaw is a ThompsonReuters company, who’s also invested in the leading Indian legal outsourcing company.  Direct legal services and mediating access to the public—not just a little WestlawNext app.

Small is also big: models of socially mediated/curated legal forms are becoming popular; some are free/nonprofit and others proprietary; many use as loss leader.  LegalZoom is being attacked on the bottom--$99 is too expensive for incorporation, we can do it for $34.  Virtual law firm: ex-BigLaw lawyers are connecting virtually through software portals, getting rid of physical overhead; being used by AmLaw 500 companies. This is the wave of middle corporate law firm access, creating new relationships with attys.  New practice guides/ethics rules are emerging.

These strategies are being adopted by lawyers but not being taught in law school.  We’ve always decried the end of the profession, but there are changes: modern client wants 24/7 service, without jurisdictional boundaries, very fast. This creates specific dangers for lawyes who need time to think: there’s an ethical constraint on how fast we can work. Thus prepackaged solutions prepared in advance are ethically responsible.

Law school market shift: 45,000 students will graduate in an average year, to 25,000 jobs requiring a JD.  We’re producing to an eroded market.  Lawyers must be tech savvy, networked, specialized, unbundled, scalable. To do it well: socially responsible, civically engaged; work-life balance; valued intermediaries providing highly personalized consultative advice.  Legal education teaches content, and some skills—fact investigation, negotiating, client counseling.  Not enough of curriculum is directed towards corporate client practice instead of litigation; we don’t teach how to operate as businesspeople or how to talk to businesspeople.  Core curriculum has to be taught: people need to understand fundamental legal content.  But we should teach critical reasoning and analysis as a course, rather than inferring skills from 1200 page casebook.  Experiential learning—clinics, field placements, simulations, reflective learning from summer jobs/in-house, etc.  We must also pull skills from MBA programs: at a minimum, organizational behavior, management and leadership.  Quantitative and qualitative skills are also important.

Prof. David S. Levine, Elon University School of Law

Bring in the Nerds: Secrecy, National Security and the Creation of Intellectual Property Law

We have no idea what’s happening internationally; compared to international lawmaking, Congress is transparent! 

Observation one: secret law is not law.  The ability to see sausage-making on the international stage: FOIA has a national security exemption.  The rubric through which int’l IP law is running currently is “national security.”  This isn’t based on the anecdotal data that piracy sometimes funds terrorism; the concern at issue here is one of diplomatic relations/effective int’l negotiations.  The ability to negotiate without the public glare; he is not suggesting that all int’l negotiations should be completely transparent and documented.  His concern is that there are fundamental info asymmetries between certain corporate entities with access to the USTR through an administrative process and others.  And the info at issue is the basic negotiating text, which is not known to the public but is known to representatives from content industries.

Current executive order includes a variety of topics: national security information, including foreign gov’t info (where IP law tends to fall—draft text has info contributed by other countries); intelligence activities; foreign relations of the US including confidential sources; scientific matters relating to national security; nuclear safeguards; system vulnerabilities; WMDs.  WMDs should probably not be treated in the same way as draft texts about IP law.

The impact is severe: ACTA.  Draft FAQ, retrieved through FOIA, included “What if U.S. positions evolve during negotiations?”  “A: The public can see how the U.S. position has evolved when the final text is signed.”  With regard to the Transpacific Partnership agreement: US says it will disclose this four years from entry into force of the TPP agreement, or four years from the close of negotiations if no agreement enters into force.  If TPP never becomes law, the public will still not know what the negotiations look like for 4 years.  Why does this need to be withheld? We know more about Russia’s ICBMs than about the US position on TPP.

Observation two: transparency, accountability and public input. We need nerds to avoid poorly drafted and unbalanced law—see, e.g., SOPA/PIPA and the DNS provisions.

FOIA needs to be reconfigured to be more about when public inputs to government are needed; difficult to apply “right to know” in abstract when competing with significant concerns on the other side.  Transparency is important when an expert would need to know more to opine.  Strong right/presumption for US negotiation texts and other information.

Prof. Deborah Tussey, Oklahoma City University School of Law

Work for Hire, Work for Free: The Dilemma of the Digital Freelance

Background: Lawsuits by HuffPo bloggers; direct dissemination by authors; crowdfunding; voluntary contributions on wikis; worries about getting paid less online.  Is WFH fair, and is it well adapted to a changing environment?  Her focus: Freelance contributors to collective works in the industries most specifically benefited by WFH.  Including revision rights and license interpretation.  Excluding academics and sound recordings.

Freelancers’ rights get determined at initial allocation, and then subsequently exploitation under license—new uses/new media. Law is written by/for publishers at both stages.  Justified as necessary to facilitate investment in and exploitation of collectively produced works.  Concerned with freelancers and “employees by interpretation”—people who get called employees because of CCNV.  Some special commissions are voluntarily negotiated WFH agreements (Spike Lee directing Malcolm X) and others are involuntary—former employees who’ve been downsized and turned into workers for hire.

Consequences may, of course, be severe for rights/duration/termination.  If a freelancer stays out of WFH, new media uses become an issue.  Tasini tried to protect freelancers by excluding electronic republication from the statutory privilege, but this was easily nullified by standard form contracts.  Publisher holds the cards.  Proposals for rectifying this: abandon agency rules as inappropriate; rejigger CCNV and import concepts of informed consent from employment law; encourage authors to organize and collectively bargain.  Intrigued by importing concepts from civil law: generally start from basic rule that employees don’t lose their copyrights, corporations can’t be authors. Then they limit transfers, require writings and specifically enumerated grants; narrowly construe grants; provide statutory royalties.  Intriguing but will Congress take lessons from Europe? 

The reality of freelancing: highly variable rewards (makes academic writing look nice). Many writers’ organizations are out there, hugely diverse by sex, genre, ethnicity, medium, etc.  Also lots of networking sites.  Some are actual unions engaging in collective bargaining; others offer services including contract review. There are some collective licensing societies.  Copyright tends to lump these folks into a few categories, but freelancers sort themselves more carefully. This might impair collective action, but also indicate problems with copyright’s treatment.  A lot of experimentation with new business models—pay what you want; direct dissemination. A fair number of positions are unpaid, as with HuffPo.

Maybe we need distinctions between the kinds of works and/or industries that will likely remain in centralized production mode.  We’re used to centralized studio system for movies, but tools are now available to decentralize.  Could also take differences in creativity into account: contributor to a case report in a database might not deserve copyright, but a contributor of an article to a magazine is different.  May need less incentives for publishers/aggregators as individuals start their own dissemination.

Maybe employee should just mean full-time employed, salaried workers.  For non-salaried contributors, they should keep copyright and we should focus on exploitation, taking lessons from civil law countries and deal with licensing as a way to even up the balance.

Greg Vetter: we now regulate medical records software—to get federal funding you have to make “meaningful use,” which is really tightly regulated.  Is this what Folsom is talking about?

A: if we look at code world as network that affects living organisms, that can lead us to the right questions.

My q: The last three presentations are all about crony capitalism: we live in a world where the winners win big and the costs are outsourced to the individuals on the bottom; tournament structure.  Three different strategies suggested—live with it and help the winners win; top down reform; and something else that might include bottom-up reform.

Garon: the bar’s inclination is to protect us from these changes, and it’s been ineffectual; the legal profession is not going to have exceptionalism that will keep competitors out.  The rise of internationalization, WTO, etc.—the model that suggests that we can hold onto our piece of the pie is naïve. My fiduciary duty to my students: be transparent with them.

Levine: Not attempting to delude himself about the role of public choice. Trying to take the actors and assume that they’re operating in good faith.  Has no doubt that campaign finance is the fundamental issue here.  Even if we solve that, there are still info asymmetries—let’s take seriously that policymakers want to make right decisions and look at structural impediments. Most of these decisions are vested in the executive, and you need to resolve procedural/administrative issues.

Tussey: WFH is what it is because publishers got it in the 1976 Act.  Freelancers have been at their mercy for a while, and she is not terribly hopeful that will change.  More hopeful that changes in tech may accomplish some things as works are capable of being produced and disseminated directly to their public.

Garon: Freelancers provide an interesting forum for collective bargaining; theater and sound recordings have been very heavily negotiated and aren’t in WFH, which illustrates that collective organizations can perform quasi-legislative functions.  Getting all the actors in the room makes a difference, as Levine suggested.

Levine: Rep. Issa’s alternative to SOPA/PIPA—public suggestions for the bill.

Boone: would also say his project is tied to this—big copyright owners v. the consumer.  If you look at history of first sale, you see a shift/reversal of roles. Copyright owners traditionally fought to hinder secondary markets, like used CDs, VCR rentals. But if the change in the method of distribution leads to getting rid of secondary markets, then it’s the users who need to seek legislative assistance and legalize secondary markets.

Sapna Kumar: FOIA change for priority when input to the government is most needed.  Who would make that decision? You don’t want it to be the agency itself—they’ll think they already got the necessary input.  Agencies don’t invest much in FOIA answers.

Levine: tech is changing the ability of government to respond more quickly and thoroughly, though e-government has been largely defunded.  Bigger theoretical question is who decides—he’s thinking about how to define the factors. Things like whether there’s a collective interest at issue.  When there’s a specific body of experts with something to provide.  Not trying to eliminate the right to know!

Katja Weckstrom: First sale and TM?  Also, for Folsom, beware of legislation—not that great at fine-tuning technical solutions.

Boone: What would it mean to look at first sale in TM?

Weckstrom: in copyright, contracts are a vehicle to profit from consumer’s use; in TM, this is usually not the case.  Usually no contractual relationship between TM owner and user.  (Compare FB’s new user agreement claiming rights over “Face” and “Book.”)  So on that model ability to control market is less; also no DRM.

Boone: He’s focused on areas dominated by copyright rights—ebooks, games.

Levine: legislative support for the change might come from TM concepts like nominative fair use—it’s ok to sell a legitimate copy--that’s worked very well for hundreds of years.

Folsom: yes, skeptical of legislative competence.  He proposes a rule of thumb that any institution can apply. He doesn’t like statutes that become outdated by the time the legislature acts—too much specificity. He wants a rule more like TM, kind of fuzzy.

A. Christal Sheppard: Industries say they won’t participate if their comments aren’t private.

Levine: he’s skeptical of this. Diebold says that it won’t sell voting machines if it has to be public in a state; a state says no; turns out Diebold wants to be in that market enough to comply!  His response: let’s find out; we know that we’re not getting good law with this flawed process. If you want to be in the room, you’re going to have to deal with the process.

Yu: For Levine: Your proposals aren’t very nerdy, but rather legal: is there a nerdy proposal?

For Garon: what’s the IP hook?

Garon: has an IP/innovation paper coming out on this.

Levine: yes, his proposal is relatively un-nerdy. Could do more with info formatting. Could also put nerds on consultation communities, but FOIA is just not even grappling with these issues.

Garon: for Boone, maybe the proposal is strongest when DRM works: you’ve converted the work into an object, and then §109 rights should apply.

Boone: agrees; his paper goes into the theory of the virtual object.  You have to regulate both DRM and contract, since either can allow the copyright owner to prevent a secondary market. That’s asking a lot, so we ask if we really need a secondary market.