From Mises blog; archived comments below.
As I noted in Against Intellectual Property, in her confused and flawed attempt to justify patent and copyright monopolies, Ayn Rand mistakenly assumed that under US patent law, the first inventor to file has priority over later filers, in the case of multiple independent inventors of the same idea. Then she bent into contortions trying to defend such an obviously unfair, and artificial and arbitrary, rule. As she wrote:
As an objection to the patent laws, some people cite the fact that two inventors may work independently for years on the same invention, but one will beat the other to the patent office by an hour or a day and will acquire an exclusive monopoly, while the loser’s work will then be totally wasted. This type of objection is based on the error of equating the potential with the actual. The fact that a man might have been first, does not alter the fact that he wasn’t. Since the issue is one of commercial rights, the loser in a case of that kind has to accept the fact that in seeking to trade with others he must face the possibility of a competitor winning the race, which is true of all types of competition.
(Rand was also wrong when she wrote: “An idea as such cannot be protected until it has been given a material form. An invention has to be embodied in a physical model before it can be patented ….” Actually, the inventor does not need to ever make a working embodiment of an invention to get a patent on it; if he never makes a working model, then the filing of the patent application, containing a written description of the invention, is considered a “constructive reduction to practice.” See Reduction to Practice (Wikipedia); Brunswick Corp. v. U.S., 34 Fed. Cl. 532, 584 (1995); Hybritech Inc. v. Monoclonal Antibodies, Inc., 802 F.2d 1367, 1376 (Fed.Cir.1 986). For other mistakes she made about how the actual IP system works, see Ayn Rand and Atlas Shrugged, Part II: Confused on Copyright and Patent.)
It’s interesting that she recognizes the patent is a monopoly (see my post Are Patents “Monopolies”?), but her defense of the first to file rule makes no sense whatsoever, and she even has the chutzpah to classify as competition the race to be awarded by the state an anti-competitive patent monopoly privilege. If anything, she should have argued that where there are multiple independent inventors, this shows the invention was inevitable, that its time had come, that it is too obvious for anyone to deserve a patent in the first place.
In any case, her assumption was wrong: the US system at the time was a first to invent, not a first to file, system–unlike patent systems around the world, which she may have been thinking of. That is, if A invents X first, then B independently invents X later, and they both file patent applications for X, then in a so-called “interference proceeding,” A would get the patent, not B, even if B filed first.1 But she thought it was first to file, so found a way to justify what she thought was the current statutory implementation of the Constitution’s patent clause. After all, the US Constitution and legal system were in her eyes almost perfect, almost Objectivist (to be fair, it’s not hard to see why she could make this naive mistake, coming from Soviet Russia, compared to which the much freer US system must have seemed like paradise)–which is why Judge Narragansett at the end of Atlas Shrugged only has to make a few tweaks to the US Constitution to make it Perfectly Rational:
The rectangle of light in the acres of a farm was the window of the library of Judge Narragansett. He sat at a table, and the light of his lamp fell on the copy of an ancient document. He had marked and crossed out the contradictions in its statements that had once been the cause of its destruction. He was now adding a new clause to its pages: “Congress shall make no law abridging the freedom of production and trade …”
It also explains why Rand initially favored eminent domain–because the Constitution implicitly authorized it (until around 1954, when Herb Cornuelle convinced her to oppose eminent domain). (I’ve been told this is indicated in Murray Rothbard’s correspondence, as I also noted in my Ideas Are Free: The Case Against Intellectual Property.)
Doubtlessly, if Rand had realized the US had a first to invent patent system, she would have found a way to justify that, and that her modern followers, realizing her mistaken assumption, are laboring to find a way to justify the first to invent system without criticizing Rand.
Well, no need to worry, modern Randian defenders of state monopoly privilege grants! For our Great Leader Obama will soon sign into law the America Invents Act, which was passed today by the Senate in an 89 to 9 vote. This patent “reform” legislation will institute a first to file system. (See the Apple Insider post US government approves patent bill in effort to reform system for the usual propaganda about how this patent reform will be good for innovation and business yada yada.) As noted in an email newsletter from the Oppedahl Patent Law Firm:
US Congress passes patent reform bill
The US Senate today passed a version of the patent reform bill that had been previously passed by the US House of Representatives. The bill now goes to the White House where President Obama is expected to sign the bill, thereby enacting it into law.
The bill, when enacted, will bring US patent law more nearly into harmony with the many countries around the world in which patents are awarded to the first inventor to file. (Heretofore US patent law contained provisions according to which someone who was second to file might sometimes prevail over the first filer, by showing an earlier date of invention.)
The bill makes dozens of other changes to US patent law, a few of which are tied to very narrow special interests but most of which will indeed promote the progress of science and useful arts. …
Of course, this “reform” bill does not improve the patent system, nor does it make any significant changes–even the change from first to invent to first to file will make virtually no difference to inventors, and no difference to victims of patent aggression–it doesn’t matter to them whether they are sued by patentee A or patentee B for “infringing” patented invention X.
Of course the best reform would be outright and immediate abolition of both patent and copyright. But other reforms, short of abolition, could also improve matters by significantly reducing the cost of patent and copyright. Of course no such real reform is being considered, nor will the vested interests in Hollywood and Big Tech and Big Pharma allow it. On a Mises blog post last year I outlined some real reform that would actually improve matters, which I reproduce below:
How to Improve Patent, Copyright, and Trademark Law
January 13, 2010 by Stephan Kinsella
As I note in my article “Radical Patent Reform Is Not on the Way,” Mises Daily (Oct. 1, 2009), there is a growing clamor for reform of patent (and copyright) law, due to the increasingly obvious injustices resulting from these intellectual property (IP) laws. However, the various recent proposals for reform merely tinker with details and leave the essential features of the patent system intact. Patent scope, terms, and penalties would still be essentially the same. In the second article of this two-part series, “Reducing the Cost of IP Law,” Mises Daily, published today, I propose various reforms to the existing patent system–short of abolition–that would significantly reduce the costs and harm imposed by the patent system while not appreciably, or as significantly, reducing the innovation incentives and other purported benefits of the patent system. I list these changes below in generally descending order of importance, without elaboration, as they are discussed further in “Reducing the Cost of IP Law”:
Patent Law
- Reduce the Patent Term
- Remove Patent Injunctions/Provide Compulsory Royalties
- Add a Royalty Cap/Safe Harbor
- Reduce the Scope of Patentable Subject Matter
- Provide for Prior-Use and Independent-Inventor Defenses
- Instantly Publish All Patent Applications
- Eliminate Enhanced Damages
- Add a Working/Reduction to Practice Requirement
- Provide for Advisory Opinion Panels
- Losing Patentee Pays
- Expand Right to Seek Declaratory Judgments
- Exclude IP from Trade Negotiations
- Other Changes
- Increase the threshold for obtaining a patent
- Increase patent filing fees to make it more difficult to obtain a patent
- Make it easier to challenge a patent’s validity at all stages
- Require patent applicants to specify exactly what part of their claimed invention is new and what part is “old” (e.g., by the use of European-style “characterized in that “claims)
- Require patent applicants to do a search and provide an analysis showing why their claimed invention is new and nonobvious (patent attorneys really hate this one)
- Limit the number of claims
- Limit the number of continuation applications
- Remove the presumption of validity that issued patents enjoy
- Apportion damages to be proportional to the value of the patent
Copyright
- Radically reduce the term, from life plus 70 years to, say, 10 years
- Remove software from copyright coverage (it’s functional, not expressive)
- Require active registration and periodic re-registration (for a modest fee) and copyright notice to maintain copyright (today it is automatic, and it is often impossible to determine, much less locate, the owner), or otherwise make it easier to use “orphaned works“
- Provide an easy way to dedicate works to the public domain — to abandon the copyright the state grants authors
- Eliminate manifestly unjust provisions of the Digital Millennium Copyright Act (DMCA), such as its criminalization of technology that can be used to circumvent digital protection systems
- Expand the “fair use” defense and clarify it to remove ambiguity
- Provide that incidental use (e.g., buildings or sculptures appearing in the background of films) is fair use
- Reduce statutory damages
Trademark
- Raise the bar for proving “consumer confusion”
- Abolish “antidilution” protection
- In fact, abolish the entire federal trademark law, as it is unconstitutional (the Constitution authorizes Congress to enact copyright and patent laws, but not trademark law)
September 9, 2011 at 1:05 pm-
I absolutely agree with you, although I would seek to abandon these protections altogether. I think no one should have authority over my mind, body, property or peaceful actions, and if I want to replicate what someone else has done, that’s my business. If their idea were so novel, trade secrecy would protect them. That isn’t the case any more, and often these companies will buy patents as strategic investments or buy them to bury competition, clipping the wings of humanity in the process.
I really don’t see why this matters anymore anyway. Atlas may not be shrugging, but I sure as hell am. I’ve put my heart and soul into being productive and getting to where I want to get in life and now I see ahead of me a bunch of whiny childish nothings competing over the last scraps of a dying society. Let them have it. I’m done.
September 9, 2011 at 2:51 pm-
Interesting,
““Congress shall make no law abridging the freedom of production and trade …””
…..what are patents if not exactly this? Granted, she only put these words into a characters mouth. But even so, the quote is totally contradictory to the intention of patent laws.
September 9, 2011 at 3:14 pm-
And the Constitution isn’t even that serious anyway.
As somebody else said (paraphrasing) “If the Constitution were serious about limiting the role of government, its clauses limiting the role of government would end with ‘or else…’ ”
Not that the Constitution isn’t a step in the right direction (hell, you should see my country’s constitution, which some say is a good compromise between interests of the left and those of the right, but it is really a compromise between social democracy and outright socialism) but it has become unhinged and unleashed, with its wording being folded upon to justify and rationalize for myriad abuses and intrusions by government.
September 9, 2011 at 11:38 pm-
Nominally the “or else” is in the document that sits beside the constitution in the National Archives. “That whenever any form of government becomes destructive to these ends, it is the right of the people to alter or to abolish it…”
Admittedly, actually doing this is sort of tricky.
September 9, 2011 at 3:31 pm-
Very interesting and thoughtful analysis, though I don’t really understand why you’re so upset about Ayn Rand’s views on this matter. She was a very opinionated person who applied her unique philosophy to many things… she was certain to be right in some cases and not right in others. The fact that you disagree and can cogently supported by facts is really the basis of her views. Who cares what so-called “Randians” are trying to do – nobody speaks for a philosophy, and her world-view would really be opposed to the idea of “contorting” ideas to fit reality in any case. I’m still not sure on where I personally stand on these issues… I have filed patents in the past… but your work here is thought provoking. Thanks.
September 9, 2011 at 3:42 pm-
It’s a human nature thing. People tend to take the word of individuals over the merits of the ideas. Rand was an influential person and had most of it right, but because of that phenomenon, she still pushes people toward the arms of the State. Once you accept the State in your life, for whatever reason, it’s just a hop skip and a jump back to where you started, full State control over everything. Leave open patents and copyrights, and politicians can easily weasel their way back to totalitarianism with little steps, appealing to the “necessary protections” of patents and copyright and expanding them into other areas of life. Much like how the Commerce Clause was designed to regulate trade only between political entities has turned into the main tool of totalitarianism in this country.
September 11, 2011 at 6:24 am-
Ah ha! The slippery slope fallacy.
It certainly is difficult to prevent a small govt becoming a big one. But once you give up on that exercise it is just a hop skip and a jump to serious trouble. You may as well give up commenting on blogs.
September 9, 2011 at 4:01 pm-
It’s not at all clear what you are trying to say.
September 9, 2011 at 6:53 pm-
You don’t follow what he just said? Or in the article?
What part isn’t clear? It’s simple logic – A+B=C.
- September 9, 2011 at 8:26 pm
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what he said was contradictory and rambling.
- September 10, 2011 at 8:04 am
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Sure it was… <- sarcasm. If you can’t follow basic English (one of the easiest languages on the planet), you may just want to give up on life altogether at this point. Go back to worshiping your shrine of Ayn Rand and stop trying to speak with adults.
- September 10, 2011 at 8:48 am
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I truly regret this last comment I made. It was childish and ignoble. I was angry at you for treating the author as an imbecile unworthy of basic civility, and I treated you just as poorly. Up to this point, I have enjoyed your writing immensely.
Here is what I should have said:I think your position that this man is rambling and incomprehensible is an indefensible one. He follows a decent structured organization which starts at the broader topic of Rand and IP protectionism and moves down into the direction he thinks we should go as an alternative. I also find your assertion that his speech is incomprehensible to be necessarily false, because I for one comprehended it well and it would seem the others who have posted thus far had zero problems comprehending it.
I find the practice of writing off something you disagree with and belittling it as an insulting and imprudent one, unworthy of rational adults. It is an intellectual laziness of ad hominen attack that would seek to belittle the author instead of giving serious thought to what he has to say. It is the sign of an individual who has a weak and impotent understanding of the subject matter at hand to the point that they cannot even begin to provide a rebuttal to these statements. It is a sign of an unthinking, apelike mind, and I know for a fact with 100% certainty that you are capable of much better than this.
The cult of objectivism would have us defend Rand unthinkingly. Let me tell you, she wasn’t the end all be all demi-goddess philosopher that many make her out to be. She borrowed extensively from Nietzsche, the classical liberals, the rationalists and the egoists while only attributing her thoughts to Aristotle, and she would declare a thing to be true without argument or defense and then move on as if her speaking it alone were enough to justify the basis for its truth. Her “epistemology,” while I think it is true, is presented in philosophical fallacy. She literally appealed to her own authority while making those arguments, and while I appreciate her gusto, this practice does not make her a good or skilled philosopher.
The difference between Rand and Nietzsche is this: Nietzsche understood the subtlety and purpose of philosophy, Rand did not. Nietzsche understood that without a rationally defensible objective morality, humanity was lost, and in his lamentation for the loss of morality, he created Nihilism truth (for if philosophy is failed, then how can you distinguish between truth and falsehood and how can you generate new truisms?), I must assert that our work is not done.
We still need a secular humanism with a rational objective epistemology and a rational objective morality. Rand showed us the back of the book, now we need to actually think and engineer a way for us to arrive there in a defensible way. Only then will we be able to create a mass market philosophy which can have the kind of impact that Rand’s impotent brand failed to have.
- September 10, 2011 at 9:42 am
- September 12, 2011 at 10:31 am
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Sorry, apparently there is a limit to the number of nests you can make in these things. I spent a few hours this weekend reading the actual act itself (ugh), and reading some article by lawyers on the subject, and the law may not be as bad I had originally thought (except of course for the fact that it continues IP protections). I should have been more thorough in my initial investigation of the topic. Thank you for taking the time to elaborate in your last post. It helped to force me to better inform myself about the subject at hand… It is also infinitely more useful for me than simply writing me off as a complete idiot, even though I was coming from a misinformed position.
September 12, 2011 at 11:19 am-
Joshua Roy,
You are one of the few critics of IP here that have actually done what you did; read the act.
Regardless whether you and I may agree, at least you are better informed, and your arguments will reflect that.
Well done.
September 10, 2011 at 3:05 am-
What a step backwards! Patenting was optional if you had proof of your invention date, but now you *need* to file or someone else could steal the rights to your own invention.
September 10, 2011 at 8:38 am-
This is not correct. To obtain a patent you have to be the inventor. If you copy it from someone else you are not the inventor. You would have to independently invent it to file a patent application.
- September 10, 2011 at 9:01 am
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That’s not even remotely true with first to file. You’ll have big firms going out to enthusiasts sites looking for ideas that are not their own, running one month pilot studies to create a more marketable design and then running to the patent office first to rob the original creator of their inventions. There’s also tons of things that have never, ever been patented, that will now become patentable under such a system. This is all just a scam for big businesses to get us to pay out tons of money for things we presently get for free to little cost.
- September 10, 2011 at 9:44 am
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Joshua, I’m a practicing patent lawyer. I know what I’m talking about. The field is complex. I have no idea what you are referring to with your comment–re “robbing” creator of ther inventions. I don’t konw what you mean that some things will now be patentable that were not before. I think your criticism is very incoherent and confused.
- September 10, 2011 at 10:17 am
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Well, what I mean is that if I invent something and I never go to the patent office and decide to offer it as open source, I own the rights to that idea whether I patent it or not. Under a first to file system, an individual could come along, take my open source idea, “develop it independently” and then file for patent protection against my will. This fundamentally changes the game, requiring me to patent all of my ideas if I wish to control them and going through the costly and time consuming process of doing so. This is obviously designed to benefit huge corporations that have the kind of resources to file patent applications daily, and it will only lead to the patent office being bogged down in applications. It also reduces my ability to refine my ideas until they are very good before filing for protection, meaning that a lot of inferior designs will begin being pushed down the pipeline.
- September 10, 2011 at 11:36 am
- September 10, 2011 at 11:45 am
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Stephan, what is the difference between “first to file” and “first to invent”? Can you lose the right to sell your own invention if someone else develops it “independently” and patents it? If so, this seems like an unjust way to force people to patent stuff. “If I don’t do it, somebody else will.”
- September 10, 2011 at 1:02 pm
September 12, 2011 at 6:31 am-
You can “reserve” your invention without a patent in the same manner you could before: by placing it for sale or using it publicly in the USA, or by publishing the invention in a conspicuous place. Either of these actions will preclude someone else’s patent application on the invention, and can prove you as the “first” inventor.
All this law does is make a presumption that the first to file between two people in an interference is the inventor, “freeing” the courts from actually looking at evidence and making a determination of who was the first to invent.
September 10, 2011 at 9:39 am-
I enjoyed this article, and especially enjoyed reading a logical criticism of Ayn Rand. As I read through your proposed copyright modifications, I became curious about how this would affect my livelihood. I’m a commercial photographer, and I enter into contractual relationships with my clients, wherein I license the use of my photos for specific and enumerated purposes for a finite period of time. I’m able to do this because US Copyright law, in theory, protects me. If any company, who is not my client, attempts to use my work for commercial purposes and lacks my permission, they are liable for damages. To my mind, this is similar to a Taxi owner who leases the cabs to drivers. If the taxi drivers took the cabs without permission and/or remuneration, they would make money by stealing from the owner, and be subject to damages. When you made the claim “Of course the best reform would be outright and immediate abolition of both patent and copyright” I read on to find substantiation for such a radical position. Is there any specific literature that could help me understand why the abolition of copyright would be the best reform?
Respectfully,
JD 
September 10, 2011 at 2:14 pm-
If Rand did not understand that the US patent system operated under “first to invent”, rather than “first to file” rules, then that is a vital point pertaining to her entire view of IP. After all, that means she attempted a justification of the US filing rule not understanding it- not realising she wasn’t, in fact, defending it at all- not realising the facts of the situation. It means she ASSUMED she was and that she really ought to have taken her own excellent advice and checked her premise FIRST. This leads to the necessary conclusion that, on this occasion at least, she did not know what she was talking about and, worse, she was engaged in a flight of rationalisation (“rationalism” and “rationalisations” are a perjurative terms in the Objectivst lexicon and the employment of the term here is intended in exactly that sense).
The twisting and turning of doctinaire Obectivists and Randists, attempting to evade Rand’s significant error/s, have been some most visible signals of their willful dishonesty and base lack of ability to apply logic, amusingly entertaining though they may have been. When it comes to arguments pertaining to IP Rand does not offer much real assistance. The bad news is that now the US filing rules are to change, the Randists are effectively being let off the hook. Watch how quickly they’ll pretend there never was a “first to invent” priority. Ha!
Sione
September 11, 2011 at 12:26 am-
Sione, I find the tone of your posting to be unnecessary and rude. I am an Objectivist, yet I have no problem admitting Rand was wrong about IP and I agree with Stephen Kinsella. Don’t be so quick to lump us all in one basket.
- September 11, 2011 at 10:28 am
- September 11, 2011 at 9:55 pm
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Ryan
OK so you find my posting “rude”. Time to toughen up those wee feelings there sweetness!
I referred to doctrinaire Objectivsts and Randists, who are, in my experience, exactly as described. That they don’t encompass “all” Objectivists should not be much of a surprise. Still, it would appear they are in the greater majority.
I have a lot of sympathy for Rand’s work and ideas, much of which are very useful and quite sound.
Remember this. Ayn Rand, despite the great contributions she made, was not the final word in philosophy or in civilised behaviour and living. Much of the troubles she experienced were self-generated, demonstrating poor judgement and (gasp) a real naughty habit of reliance on rationalisation when it suited (OK, call it excuse-making employed in self-justification).
Rand’s work in this very field of IP was not sound. Her ideas on IP were an important feature of her personal system of thought. She considered the “product of man’s mind” approach fundamental in setting up her derivations of individual rights (property right included). Hence her reliance on this notion for her defense of IP demonstrated a major problem for the entire appraoch she was taking here. Don’t take my word for it, read what she wrote, then contrast that with Prof Herman-Hoppe.
Enjoy!
Sione
PS. Stefan, for the majority of Objectivists locally IP is considered to be real property and so it is ruthlessly, if utterly irrationally and illogically, defended. The local leading wallah/s are quite unable to consider ANYTHING Rand wrote or said or did to be even potentially mistaken. On the other hand, there are a few who think for themselves and some of them are worth discussing such matters with…
Sione
October 6, 2011 at 9:15 pm-
You’ve certainly spun a two-line molehill into a mountain of nonsense here, just to feel that you’ve somehow got one over on Ayn Rand. Why are you so negatively obsessed with her views? Simply because she disagreed with you?
Aside from the fact that you’ve taken so much mileage out of so little material, your core assumption that mistakenly believing the US system operates on a first-to-file basis (which is itself a flimsy claim about Rand given the scant evidence available) somehow undermines her position on the nature of intellectual property is a non sequitur. Her position on intellectual property is not based on that belief about the patent system at all, and in fact has nothing to do with any particular system of patents or copyrights. Intellectual property right, in her view, are like all rights – not *granted* by governments, only *guaranteed* by them. The creator and owner of property, whether physical or intellectual, has the right to that property whether anyone respects it or not.
Perhaps you should research her views more carefully before you take such a condescending and triumphant tone toward them?
Also, it’s clear from the rest of the comments that among this crowd “a mindless Randroid drone” should be translated to “anyone who agrees with her and not me, no matter how they actually came to agree with her, because I have no argument to offer”. Are you aware how embarrassing this kind of behavior is for you?
- Some have argued that the US patent system briefly first to file, for a few years in its inception right after the Constitution’s ratification, until changed to the first to invent system. But it was definitely first to invent in Rand’s lifetime. [↩]
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