From Mike Masnick at Techdirt (from 2007):

New Study Shows Patents And Innovation Are Not Related

from the no-clear-connection dept

There’s an annoying trend among many to assume that patents are a proxy for innovation. In fact, this leads to the false assertion that more patents or more patent applications somehow means more innovation. However, as we’ve obviously seen, the reverse can often be true. We’ve shown plenty of examples where patents have been used to hold back innovation rather than encourage it. It’s nice to see that there’s some more data supporting this as well. John Bennett atAgainst Monopoly points us to a new paper from Booz Allen Hamilton, looking at 1000 companies that do serious research and development, where they found no link between patents and innovation. Patents, they note, show no statistical relationship to profits. They point out that few patents actually have any real impact on innovation, and often the most innovative things have no patents at all. Another interesting finding in the study is that big companies aren’t very good at leveraging their scale to innovate. This is an issue that comes up often when we discuss patents. People make the claim that small companies can’t out-innovate large companies because those large companies have all the money. However, the study suggests that’s not true at all. Larger companies can be woefully bureaucratic, slow, inefficient and risk averse. That leaves plenty of opportunity for smaller companies to out innovate the larger ones despite the appearance of a disadvantage in money and scale.

See also Pierre Desrochers, On the Abuse of Patents as Economic Indicators, Quarterly Journal of Austrian Economics (Winter 1998).

Update: KOL235 | Intellectual Property: A First Principles Debate (Federalist Society POLICYbrief) and James Stern: Is Intellectual Property Actually Property? [Federalist Society No. 86 LECTURE]

The Federalist Society has long offered a generally excellent Conservative & Libertarian Legal Scholarship: Annotated Bibliography. Years ago I remember it being in paper form, and now it is online, and appears to be updated fairly often. [Update: see also Conservative & Libertarian Pre-Law Reading List.]

The Intellectual Property section was last updated recently (December 2010, repixeled below) but  it unfortunately seems to have a decidedly pro-IP, utilitarian, and mainstream bias. The material listed is dominated by law and economic analysis (Posner); positivist legal analysis by fairly mainstream scholars; and  technical legal analysis (Chisum) of interest mainly to patent practitioners, not to libertarians and conservatives.

As far as I can tell the material listed contains little explicitly libertarian analysis, other than pieces by utilitarian libertarian law professor Richard Epstein and Objectivist law professor Adam Mossoff—both of whom are pro-IP. The bibliography is missing a wealth of important anti-IP work by libertarians and economists, including many economic and empirical studies that conservatives and libertarians interested in the IP issue should be familiar with. It even omits classic studies by Plant and Machlup (see below). The bibliography should be supplemented with key anti-IP and other important references to provide a more balanced and useful research tool. The need for making libertarians and conservatives aware of the missing material is pressing, given:

• the increased importance of IP in the last fifteen years, since the dawn of the Internet;
• the concomitant increase in interest in IP among libertarians and others;
• the increasing use of copyright to stifle Internet freedom and civil liberties and to ratchet up the police state;¹
• and the growing tide of opposition to IP among economists,² legal scholars,³ and libertarian thinkers.⁴

The C4SIF Resources page contains a wealth of material that could be used to improve the bibliography, such as the following (and more):

• Kinsella, “The Case Against IP: A Concise Guide“
• Kinsella, Against Intellectual Property
• Boldrin & Levine, Against Intellectual Monopoly
• Jacob H. Huebert, “The Fight against Intellectual Property,” in Libertarianism Today
• Fritz Machlup, U.S. Senate Subcommittee On Patents, Trademarks & Copyrights, An Economic Review of the Patent System, 85th Cong., 2nd Session, 1958, Study No. 15 (text excerpt) [“Report to the US congress from 1958, which also extensively narrates the history of the patent movement and of earlier economic research on this subject. Machlup, a renowned American economist of Austrian origin, is the first author of a large treatise on knowledge economics and other treatises which belong to the teaching repertoire of economics departments in universities. His report cites a wealth of historical and economic evidence to refute most of the reasoning used by lawyers to legitimate the patent system.”]
• Fritz Machlup & Edith Penrose, “The Patent Controversy in the Nineteenth Century,” Journal of Economic History 10 (1950), p. 1
• Arnold Plant, “The Economic Theory Concerning Patents for Inventions,” Economica, New Series, 1, no. 1 (Feb., 1934)
• Benjamin Tucker (see Wendy McElroy, Copyright and Patent in Benjamin Tucker’s periodical Liberty)
• Tom W. Bell, Intellectual Privilege: Copyright, Common Law, and the Common Good (draft)
• ———, The Great Debate on Intellectual Property, in Cato Policy Report (January/February 2002)
• Hayek on IP (see Tucker, Misesian vs. Marxian vs. IP Views of Innovation; Tucker, Hayek on Patents and Copyrights; Salerno, Hayek Contra Copyright Laws)
• Ludwig von Mises, Human Action 3rd rev. ed. Chicago: Henry Regnery (1966), chap. 23, section 6, pp. 661–62; see also pp. 128, 364; see also Kinsella, Mises on Intellectual Property
• Murray N. Rothbard, Knowledge, True and False
• ———, Man, Economy, and State and Power and Market, Scholars Edition, pp. liv, 745-54, 1133-38, 1181-86
• Tom Palmer, “Intellectual Property: A Non-Posnerian Law and Economics Approach”
• ———, “Are Patents and Copyrights Morally Justified? The Philosophy of Property Rights and Ideal Objects”
• Julio Cole, “Patents and Copyrights: Do the Benefits Exceed the Costs?”
• Roderick Long, Owning Ideas Means Owning People
• ———, The Libertarian Case Against Intellectual Property Rights
• Francois Leveque & Yann Meniere, The Economics of Patents and Copyrights
• Timothy Sandefur, “A Critique of Ayn Rand’s Theory of Intellectual Property Rights,” Journal of Ayn Rand Studies 9:1 (Fall 2007), pp. 139-61
• Mark Lemley: The Very Basis Of Our Patent System… Is A Myth;
• Andrew Torrance (see Open Science Summit 2011: IP and the New Mercantilism: Panel: “The Future (the End?) of ‘Intellectual Property’”; Andrew Torrance: Patents and the Regress of Useful Arts)
• Chris Sprigman (see The Knockoff Economy: How Copying Benefits Everyone, Reason.tv; Christopher Sprigman on creativity without copyright)

I did suggest some of my IP writing to the editor of the bibliography a few years ago, before it was most recently updated, but my advice was obviously not heeded, so it’s possible this is an uphill battle. Those more closely connected to the Federalist Society should urge them to consider this. [continue reading…]

1. See my posts Where does IP Rank Among the Worst State Laws?; Death by Copyright-IP Fascist Police State Acronym; SOPA is the Symptom, Copyright is the Disease: The SOPA Wakeup Call to Abolish Copyright; Masnick on the Horrible PROTECT IP Act: The Coming IPolice State; Copyright and the End of Internet Freedom. [↩]
2. See my post The Overwhelming Empirical CaseAgainst Patent and Copyright. [↩]
3. See my post Legal Scholars: Thumbs Down on Patent and Copyright. [↩]
4. See my article “The Death Throes of Pro-IP Libertarianism,” Mises Daily (July 28, 2010) and my posts The Four Historical Phases of IP Abolitionism and The Origins of Libertarian IP Abolitionism. [↩]

One of my posts from LewRockwell.com in 2003:

Teach me more!

Posted by Stephan Kinsella on June 17, 2003 11:14 PM

Excellent Forbes post by Jon Matonis, “Generic Viagra Industry Is Pro-Choice In Payments,” in which he points out that “payment intervention” is being used to stamp out online pharmaceuticals, giving rise to increasing interest in alternative systems like bitcoin to evade control by the state-corporatist duopoly:

Payment intervention is defined as the use of the payment mechanism to detect or prevent certain transactions that are deemed to be politically incorrect or against a particular jurisdiction’s law. The latest target is online pharmaceuticals and their affiliates providing medications such as generic or unlicensed Viagra, Nexium, or Lipitor, all of which are illegal for Americans to have mailed into the United States.

In the recent paper “Priceless: The Role of Payments in Abuse-advertised Goods” presented at the 19th annual ACM Computer and Communications Security Conference in Raleigh, North Carolina, five academic researchers outline the methodology behind the aggressive practice known as payment intervention and arrogantly conclude that it is in society’s interest.

This is the ugly face of monetary repression. It is shameful! Using the payments system as a repressive tool for or against certain behavior is like using Catholic Church attendance as a way to target illegal immigrants. In a free society, private payments should be covered by merchant-customer privilege just as attorney-client privilege covers confidential legal communication. Like the telephone network used to execute a transaction, the payments network is a neutral actor. Pro-choice means placing the decision of payment type in the hands of the money owner. Grandma wants her affordable generic Lipitor.

Leaving aside for the moment the twisted economics of privileged drug manufacturers collaborating with generic manufacturers, the immorality of the patent system, and the case against intellectual property, supranational authority was bestowed upon the IACC (International AntiCounterfeiting Coalition) in 2010 through a series of agreements made between brand holders, payment providers, and the White House’s Intellectual Property Enforcement Coordinator. The agreements streamlined targeted actions against ‘rogue’ websites and merchant accounts used to monetize counterfeit goods and services.

From Courthouse News Service:

William Faulkner v. Woody Allen

 

By ROBERT KAHN

In a copyright complaint that tests the limits of “fair use,” Faulkner Literary Rights sued Sony Pictures for a nine-word (mis)quote of William Faulkner in the Woody Allen movie, “Midnight in Paris.

In the 2011 film written and directed by (nonparty) Woody Allen, the hero, Gil Pender, played by Owen Wilson, somehow ends up in Paris in the 1920s, and meets artistic giants such as Hemingway, Picasso and F. Scott Fitzgerald.

The complaint states: “In describing his experiences, Pender speaks the following lines (the ‘Infringing Quote’): ‘The past is not dead! Actually, it’s not even past. You know who said that? Faulkner. And he was right. And I met him, too. I ran into him at a dinner party.'”

The complaint continues: “The Infringing Quote is taken from a passage in the William Faulkner book ‘Requiem for a Nun’ (‘the Book’), where it reads: ‘The past is never dead. It’s not even past.’ (‘the Original Quote’).”

Faulkner Literary Rights then points out that Faulkner copyrighted the book in 1951, and that it owns “all right, title and interest in the name, image and likeness of William Faulkner.”

It claims the infringing misquote, and use of Faulkner’s name, are “likely to cause confusion, to cause mistake, and/or to deceive the Infringing Film’s viewers” about the perceived affiliation, connection, sponsorship, origin or approval of the Faulkner association and Sony.

Read more>>

A really excellent piece by Will Swaim on IP in Global Trade magazine’s November 2012 issue, in its regular “The Big Idea” section. The piece quotes extensively from me and other libertarian IP opponents such as Sheldon Richman and Tom Bell:

PATENTLY EVIL

 

What if ‘intellectual property’ is bad for business?

 

[ by Will Swaim ]

Outside the GOP convention, they hate capitalism. Inside, they worry about rising China.

 

The air around the Republican convention in Tampa, Florida, in August was stifling, and not just because of meteorological phenomena. As Hurricane Isaac wheeled through the Gulf of Mexico, the humidity spiked and otherwise easygoing Floridians became a little edgy. In the city’s historic Ybor City district, a mostly young crowd of about 1,500 protesters marched for several blocks, noisily but peacefully denouncing Republicans, capitalism and even meat. Geographically (and perhaps symbolically) closer to the St. Pete Times Forum where Republicans were gathered to hoist Massachusetts Gov. Mitt Romney to their shoulders, libertarians—again, mostly young—protested the Republican Party’s rough handling of Ron Paul, the Texas congressman and erstwhile presidential candidate.

Inside the convention center, delegates put the finishing touches on the Republican Party’s platform document, this year titled “We Believe in America.”

If you’re a global trader, reading the platform’s statement on intellectual property, or IP, might have sent you into the streets to join the lefties and libertarians outside.

Like their Democratic counterparts, the Republicans who drafted the GOP statement of ideals fail to understand the possibility (just the possibility) that protecting ideas the way you would your home or your wallet—as actual “property”—is bad for America.

 

After properly celebrating exports as “crucial for our economy,” the 2012 Republican platform bemoans the theft of intellectual property, the “downside” in the “worldwide explosion of trade.”

“Some governments have used a variety of unfair means to limit American access to their markets while stealing our designs, patents, brands, know-how, and technology—the ‘intellectual property’ that drives innovation,” the platform reads. “The chief offender is China.”

We expect the Democratic Party, with its roots sunk firmly in organized labor, to amplify protectionist anxieties. But the Republicans? The party of limited government?

The GOP platform suggests that a Mitt Romney administration would resort to trade wars in order to punish intellectual property theft abroad with the hammer of righteousness. “Republicans understand that you can succeed in a negotiation only if you are willing to walk away from it,” it reads. Under a President Romney, “[c]ounterfeit goods will be aggressively kept out of the country. Victimized private firms will be encouraged to raise claims in both U.S. courts and at the World Trade Organization. Punitive measures will be imposed on foreign firms that misappropriate American technology and intellectual property.”

The convention also featured a kind of Exhibit A, speaker Steve Cohen, president of Screen Machine Industries of Etna, Ohio, a U.S. exporter meant to represent all exporters.

Cohen started with the inarguable (“As a manufacturer, our products are the heartbeat of our business”), before telling the audience that his company spends “tens of thousands of dollars to achieve patent status. Once granted, we expect it to be protected. Our products are often stolen and copied overseas for a mere fraction of the price. We can’t tolerate other companies stealing our hard work without compensation.”

Cohen concluded that, among other things, “We need a new president that will protect America’s patented inventions.”

But do we need such a president? What if IP, as a concept in law, is bad for America? [continue reading…]

Yet another law professor who is skeptical of current—and mercantilist—arguments for ratcheting up copyright enforcement, Tulane law professor Glynn Lunney. He argues against increasing copyright protection, and, indeed, that “only a very limited degree of copyright protection – something akin to the fourteen years of protection against mechanical duplication by competing commercial publishers that the 1790 Copyright Act provided” “may” be justified. And consumers should be free to share files. From Mike Masnick at Techdirt:

Copyright: The New Mercantilism

from the it’s-a-protectionist-monopoly-law dept

We’ve argued for a while that copyright is frequently used as a new form of mercantilism, the mostly discredited economic theory that basically said that the government should be heavily involved in “protecting” local industries with monopolies and tariffs. Adam Smith’s seminal works, which more or less created the field of economics were really, in part, a critique of mercantilism, and how it could cause more economic harm than good. When you take a wider view of copyright law and policy (especially in international trade), it’s not difficult to conclude that it’s very similar to classic 17th century mercantilism.

So it’s interesting to see Tulane professor Glynn Lunney publish a paper arguing exactly this: that copyright has become a mercantilist tool, and that’s a problem.

Over the last twenty years, arguments for broader copyright have taken an increasingly mercantilist turn. Rather than argue for broader copyright in terms of more or better original works, proponents have begun arguing for broader copyright on the basis of revenue and jobs. Consumer copying is theft or piracy, proponents insist, depriving copyright owners of revenue and destroying jobs. In this article, I review these arguments and show that they are empty. While the Internet and digital technology has made widespread consumer copying a reality, broader copyright can be justified only if this copying has interfered with the creation and dissemination of new original works. But it has not. Using a hand-coded data set examining the number of new artists and cover songs in the top fifty of the Billboard Hot 100 chart in the first week of each month for the years 1990-2010, I show that while music industry revenue has fallen sharply since Napster opened its virtual doors, output in the music industry, both in terms of quantity and quality, has increased just as sharply. Part of the explanation for this seemingly paradoxical result, is that the digital revolution, while it has made consumer copying trivially easily, has also reduced costs, risks, and barriers to entry in the music industry. Yet, this cannot be a complete explanation.

To account for the rest, I offer a theoretical model and a simple explanation for why the incentives for music creation have remained sufficient in the face of widespread consumer copying: Consumers don’t just love music generally; they love their particular favorite artists and their specific favorite songs. While consumers would like to get music for free, they know that they have to support their favorite artists in order to get and to continue getting the music they want. As a result, self-interest tends to ensure that consumers do not free ride too much. While the resulting market is unlikely to be perfect, legislation from Congress is not likely to improve the situation. Just as product markets fail in predictable circumstances, so too do political markets. When, as in the debate over broader copyright, proposed legislation benefits a concentrated interest group, such as copyright owners, at the expense of a dispersed interest group, such as copyright consumers, Congress is systematically likely to get the answer of how much copyright is optimal wrong, and badly wrong at that. In short, we have far more to fear from government intervention in the markets for original works than we do from leaving these markets alone.

I met Lunney a few months ago, and saw him present some of this research at a conference, and he makes a really compelling case (I had a minor disagreement with him over some of his data, but the overall work is really, really solid). The full paper is totally worth reading. As I read through it, I kept thinking I wanted to quote basically everything, so instead I’ll just repeat: go read the full paper. I will include this bit from near the end, however:

While I recognize the political difficulty, and perhaps futility, of proposing a constitutional amendment limiting Congress’s power in this area, I think it is time, and past time, to put such options on the table. It has been over two hundred years since our Constitution was written, and we have a much better sense today for where representative democracy works and where it fails. Because copyright benefits a concentrated and well-organized interest group at the expense of a dispersed group, establishing an optimal copyright regime is simply not something Congress has done or will do well. We should therefore limit Congress’s power to act on this issue. At the simplest, such a constitutional amendment might follow Jefferson’s suggestion and substitute “for no more than fourteen years” for the phrase “for limited times” in Article I, section 8, clause 8. Taking it a step further, an amendment might specify or limit the nature of the “exclusive rights” that Congress may grant. I fully recognize that such an approach would enshrine a set of rights that, even if optimal today, may not prove optimal for all time. Such an approach would almost certainly impose a set of legal rights that will not fit perfectly the needs of the future, as technology and markets change. Nevertheless, I believe that such an approach remains preferable to our current approach. Any welfare losses that may result from constitutionalizing today’s optimal set of rights and imposing those rights onto the future would be less than the welfare losses that will result, and have resulted, from leaving the issue to Congress. Given how overbroad copyright has become, even an amendment barring Congress (and the states as well) from granting exclusive rights to authors for their writings altogether would be better than where we find ourselves today.

Once again, go read the whole thing… and remember the key points he raises the next time you see copyright maximalists bring up how many “jobs are at stake.” That’s a bogus claim, as Lunney notes elsewhere in the paper:

for the copyright industries to receive more revenue, consumers must pay more for works of authorship. Broader copyright, after all, does not generate revenue from thin air. It has to come from somewhere. If consumers have to pay more for works of authorship, they will have less to spend on everything else. Thus, more revenue for the copyright industries necessarily means less revenue for other sectors of the economy. If more revenue for copyrighted works means more jobs for the copyright industries, presumably less revenue everywhere else means fewer jobs elsewhere in the economy

Copyright is about Congress picking winners and losers in a true mercantilist manner — and Congress has proven especially bad at doing that well — in part because they only seem to listen to the claims of the industry which benefits from such policies.

From TheNextWeb:

Jailbreaking your phone is legal in the US, but not for other mobile devices

26TH OCTOBER 2012 by KEN YEUNG

The United States government has ruled that it’s perfectly legal for you to jailbreak your phone — and by jailbreak, we mean that it’s not going to violate any copyright laws. But don’t think that you’re going to be able to legally hack any of your other devices, because the US Copyright Office says that tablets are excluded from this ruling.

As reported by The Verge, the US Copyright Office issued rulings on exemptions to the Digital Millennium Copyright Act (DMCA) today and said that the “category of tablets is difficult to define” so rather than issue a blanket exemption, it declined to lump tablet devices in with phones.

Read more>>

Who can deny that copyright is arbitrary, and not a protection of any natural property rights?

From Wikipedia (h/t Wirkman Virkkala):

In 1974, Parker Brothers sued Anspach over the use of the “Monopoly” name, claiming trademark infringement. While preparing his legal defense, Anspach became aware of Monopoly’s history prior to Charles Darrow‘s sale of the game to Parker in 1935, and how it had evolved from Elizabeth Magie‘s original Landlord’s Game into the version Darrow appropriated. Anspach based his defense on the grounds that the game itself existed in effectively the public domain before Parker purchased it, and therefore Parker’s trademark claim on it should be nullified. The case dragged on for ten years^[1], with numerous appeals and overturned judicial verdicts, until Anspach and Parker ultimately reached a settlement, permitting him to continue using the name Anti-Monopoly and distributing the game.^[2]

The game is currently in print, and is produced and distributed worldwide by University Games.

The Industrial Radical, the new quarterly magazine of the Molinari Society (which is affiliated with the Center for a Stateless Society, to which I serve as an Adviser), has a great copyright policy (see below). I give my reasons for preferring CC-BY to CC-BY-SA in Copyright is very sticky!, so I’m glad they give the CC-BY option in addition to their default CC-BY-SA.

Industrial Radical Copyleft Policy

The editors of The Industrial Radical reject the concept of “intellectual property,” and we favor the abolition of all patent and copyright restrictions. We regard the intellectual enclosure of patents and copyrights as a constraint on minds and markets, an invasion of individual rights, and an increasingly destructive form of protectionism. A free society means free minds and free culture; so we’ve adopted a policy ofcopyleft for the magazine. To paraphrase the Free Software Foundation’s explanation, proprietary content uses copyright to take away readers’ freedom; free content makes creative use of copyright to guarantee their freedom. That’s why we reverse the name, changing “copyright” to “copyleft.” Everything we print will either be certified in the public domain, or released under a free content license that guarantees your ability to reprint or reuse, without permission or restriction.

Licenses and Legal Details

As a contributor to the Industrial Radical, you retain copyright over the work you contribute. But you agree to make your work available under a license that will protect the rights of others to reprint and reuse without the restriction of intellectual property monopolies. In order to keep things as simple as possible, we strongly prefer works that are licensed under the most up-to-date version of the Creative Commons Attribution-ShareAlike license, currently CC BY-SA 3.0. CC BY-SA frees readers to reproduce, reprint, and reuse the work so long as they (1) properly credit you as the creator of the original work, and (2) keep their copies or derive works under the same copyleft license, spreading freedom from restrictive copyright wherever they print it.

If you need to request an alternative arrangement, for legal reasons or reasons of personal preference, we can also accept work that has been certified in the public domain, or which is held under other free content licenses, such as CC-BY 3.0, older versions of the Creative Commons licenses, the GNU Free Documentation License, or other, similar free content licenses.

We will not print any works under licenses that impose restrictions on the distribution of copies or derivative works beyond the requirements that these works provide honest credit and remain free. The purpose of our copyleft policy is to enable free use, not to restrict it selectively. In particular, we won’t publish any works under the restrictions of Creative Commons NonCommercial or NoDerivs license terms.

 

Related Links

• Charles Johnson (2003-11-06): Copyleft and Copyright: The Prospects for Liberty
• Creative Commons
• Free Software Foundation: What is Copyleft?
• Roderick T. Long (1995): The Libertarian Case Against Intellectual Property Rights
• Molinari Institute: Anti-Copyright Resources
• Center for the Study of Innovative Freedom

I was invited some time ago to submit a paper on the libertarian approach to intellectual property for a Springer Reference work, Handbook of the Philosophical Foundations of Business Ethics (Prof. Dr. Christoph Lütge, ed.; Springer, 2013). It’s just been released and is available at the previous link.  Steep price of $949, but it’s a massive book—1582 pages, in 3 volumes, containing 20 “Parts” and 77 chapters total (flyer).

At least two of the sections were edited by libertarians: Part 17, on “Free Markets, Morality and Business Ethics,” was edited by Tibor Machan, and Part 18, on “Property Rights: Material and Intellectual,” was edited by Robert McGee. My paper, “The Case Against Intellectual Property” (PDF; HTML), appeared in this latter Part. It is based on my previous Against Intellectual Property, but omits some material in AIP that very few need to read, such as the examples in the Appendix and the lengthy bibliography. My chapter includes a Creative Commons-BY license. The Abstract is below:

The purpose of property rights is to allocate owners of scarce resources to permit peaceful, cooperative, productive use of these resources. For external, non-bodily resources, this allocation is done in accordance with the libertarian-Lockean first-use/first-own homesteading principle. So-called intellectual property rights such as patent and copyright are monopoly privileges granted by the state that dilute and undermine property rights in scarce resources. This chapter explores the nature of property rights and argues that intellectual property is incompatible with genuine private property rights. The chapter also criticizes utilitarian arguments in favor of intellectual property as being fallacious in terms of ethics, methodology, and economics.

As I have discussed before,¹ the state is schizophrenic. It grants monopolies aimed at limiting competition (patents and copyright), and then penalizes companies for using (“abusing”) them, in contravention of state antitrust law–so that there is a “tension” between these state laws. Then courts have to “balance” these against each other. Each state law gives the state an excuse to ratchet up its power. Here’s an idea: get rid of both antitrust and patent law.² (Likewise, there is also a “tension” between copyright censorship, and the right to free speech.)³

The latest example is noted in PCMag’s post DOJ Probing Samsung Over Patent Abuse, Apple Says:

The Department of Justice is reportedly investigating Samsung for patent abuse, according to a court filing from Apple.

The document, filed with the International Trade Commission, says that the “Department of Justice has opened an investigation into the manner in which Samsung has used – or misused – its declared-essential patents.”

A Samsung spokesman, however, said the company “has not received any formal notification from the authorities.”

“Samsung has been and remains committed to fair licensing of standard-essential patents,” he said.

The filing squares with a June report from Bloomberg that said “the Justice Department will scrutinize Samsung Electronics Co.’s handling of industry-standard patent claims.” Bloomberg’s source, however, didn’t know if the DOJ had formally contacted Samsung for more information.

That same article said the Federal Trade Commission would probe Motorola over its handling of essential patents.

Samsung is already under investigation across the pond. In January, the European Commission opened a formal investigation into whether Samsung has used its patents to “distort competition” in the European mobile market.

EU rules require companies that hold patents essential to the implementation of a standard to license them on fair, reasonable and non-discriminatory (FRAND) terms. So, if a company has a patent for something that is required to make all cell phones work – like network connectivity – it needs to make good faith efforts to license its technology to other companies, even direct rivals.

Most companies under fire on this issue – including Samsung – have said that they made efforts to license their technology, but have not been able to reach a workdable deal.

Yeah. This “workable deal” nonsense reminds me of the theory that patents are just an “opportunity to bargain.” (See Feldman: Patents don’t define property rights; they are an “opportunity to bargain.” Don Corleone nods.) Funny how the state limits the effects of the patent monopolies it grants for things that are “essential.” But for other things, it’s okay for patents to be used to muck things up.

Here’s a novel idea: instead of handing out these monopolies and then using antitrust law and related rules to prevent monopolies or other damage from resulting…. stop granting patents.

1. FTC: Western Digital and Hitachi must give assets and IP rights to Toshiba: Patents, Antitrust, and Competition. [↩]
2. See EU newsflash: patents are anticompetitive!; Pro-IP Libertarians Upset about FTC Poaching Patent Turf; State Antitrust (anti-monopoly) law versus state IP (pro-monopoly) law; The Schizo Feds: Patent Monopolies and the FTC; see also When Antitrust and Patents Collide (Rambus v. FTC); Antitrust vs. Trademark Law; Price Controls, Antitrust, and Patents; IP vs. Antitrust; The Schizophrenic State; Intel v. AMD: More patent and antitrust waste. [↩]
3. Should Copyright Be Allowed to Override Speech Rights? [↩]

This is included as ch. 32 of Stephan Kinsella, ed., The Anti-IP Reader: Free Market Critiques of Intellectual Property (Papinian Press, 2023).

***

There has long been skepticism about state-granted “intellectual” monopoly privileges among economists, and even this is growing in recent decades. See, e.g., my posts The Overwhelming Empirical Case Against Patent and Copyright, The Four Historical Phases of IP Abolitionism, and The Origins of Libertarian IP Abolitionism. As a sampler (more detail in the first link above):

Fritz Machlup, 1958:

No economist, on the basis of present knowledge, could possibly state with certainty that the patent system, as it now operates, confers a net benefit or a net loss upon society. The best he can do is to state assumptions and make guesses about the extent to which reality corresponds to these assumptions. … If we did not have a patent system, it would be irresponsible, on the basis of our present knowledge of its economic consequences, to recommend instituting one.

François Lévêque and Yann Ménière (Ecole des mines de Paris, 2004):

The abolition or preservation of intellectual property protection is … not just a purely theoretical question. To decide on it from an economic viewpoint, we must be able to assess all the consequences of protection and determine whether the total favorable effects for society outweigh the total negative effects. Unfortunately, this exercise [an economic analysis of the cost and benefits of intellectual property] is no more within our reach today than it was in Machlup’s day [1950s].

Boston University Law School Professors (and economists) Michael Meurer and Jim Bessen concluded (2008) that on average, the patent system discourages innovation. As they write: “it seems unlikely that patents today are an effective policy instrument to encourage innovation overall” (p. 216). To the contrary, it seems clear that nowadays “patents place a drag on innovation” (p. 146). In short, “the patent system fails on its own terms” (p. 145).

And in a recent draft paper (2012), economists Michele Boldrin and David Levine state:

The case against patents can be summarized briefly: there is no empirical evidence that they serve to increase innovation and productivity, unless the latter is identified with the number of patents awarded—which, as evidence shows, has no correlation with measured productivity. This is at the root of the “patent puzzle”: in spite of the [enormous] increase in the number of patents and in the strength of their legal protection we have neither seen a dramatic acceleration in the rate of technological progress nor a major increase in the levels of R&D expenditurein addition to the discussion in this paper, see Lerner [2009] and literature therein. As we shall see, there is strong evidence, instead, that patents have many negative consequences.

What about lawyers and legal scholars? Among practicing lawyers, the most vociferous ones on IP policy tend to be those who know a bit about patent or IP law. They tend to be practitioners who are naturally biased toward supporting this system; it pays the bills. So it’s no surprise most IP practitioners come up with arguments in favor of patent or copyright, when pressed; but they argue like lawyers, which is to say: like advocates pressing a case, instead of scholars or scientists trying to find the truth. Their arguments are typically consequentialist or utilitarian, though empty of data and without serious or scholarly rigor. So of course we have a slew of IP apologists and shills—patent lawyers like Dale Halling,¹  Gene Quinn,² Lawrence Ebert,³ and John Harris.⁴ They rarely put forward any serious argument; they might as well say, “we make money from this system and like it!” Which is hard to disagree with, but is … not an argument for maintaining the IP system.

Still, despite the pressure on IP specialists to toe the line, most never try to justify it, many realize that arguments in favor of it are flawed,⁵ and a brave few actually come out openly in opposition.⁶

As Wendy J. Gordon notes, “IP theorizing was sparse in legal academia until the second half of the twentieth century.”⁷ But that has changed. And among those law professors and legal scholars looking into the normative or policy basis of IP, there seems to be a growing number who are deeply suspicious of patent and copyright and who favor drastic scaling back of these laws if not outright abolition. Such as those on the following, non-comprehensive, list (I have bolded the ones that appear to be the most radical—who are for IP abolition or something close to it):

1. See Shughart’s Defense of IP, Dispatch from the Open Science Summit: Citizen Science, Microfinanced Research, Patent Trolls, and Pharma Prizes, and Thomas Jefferson’s Proposal to Limit the Length of Patent and Copyright in the Bill of Rights; also other posts here. [↩]
2. See here and Gene Quinn the Patent Watchdog. [↩]
3. IPBiz’s Ebert: Kinsella way off on patent reform. [↩]
4. Another Reason to Reform Patent Law: Touch Off A Recession! . [↩]
5. See Miracle–An Honest Patent Attorney! [↩]
6. See Patent Lawyers Who Oppose Patent Law. [↩]
7. Wendy J. Gordon, “Intellectual Property“. [↩]
8. Tom W. Bell, Intellectual Privilege: A Libertarian View of Copyright; and my posts Tom W. Bell on Intellectual Property and Locke on IP; Mises, Rothbard, and Rand on Creation, Production, and “Rearranging”. [↩]
9. See The Knockoff Economy: How Copying Benefits Everyone, Reason.tv; Christopher Sprigman on creativity without copyright. [↩]
10. Mark Lemley: The Very Basis Of Our Patent System… Is A Myth; 90+ Internet law and IP law professors sign anti-PROTECT-IP letter… [↩]
11. Intellectual Property’s Great Fallacy . [↩]
12. James Bessen & Michael J. Meurer, Patent Failure: How Judges, Bureaucrats, and Lawyers Put Innovators at Risk (2008, excerpts available at researchoninnovation.org/dopatentswork/); see also Bessen’s Research on Software Patents. [↩]
13. The Future of Ideas (2001 [↩]
14. See my post, Intellectual Property’s Great Fallacy. [↩]
15. See resources here. [↩]
16. See Open Science Summit 2011: IP and the New Mercantilism: Panel: “The Future (the End?) of ‘Intellectual Property’”; Andrew Torrance: Patents and the Regress of Useful Arts; see also the 2003 National Academies report on intellectual property; the  full citation and quotation is in the introduction Torrance’s paper  Patents and the Regress of Useful Arts, which characterize evidence linking IP and innovation as “emergent”—this is from the National Academies. [↩]
17. Andrew Torrance: Patents and the Regress of Useful Arts; Torrance & Tomlinson, Patents and the Regress of Useful Arts. [↩]
18. Jacob Huebert, The Fight against Intellectual Property. [↩]
19. See Eben Moglen and Leftist Opposition to Intellectual Property. [↩]
20. Copyright: The New Mercantilism. [↩]
21. Can Patents Deter Innovation? The Anticommons in Biomedical Research [↩]
22. Wendy J. Gordon, “Intellectual Property“; “An Inquiry into the Merits of Copyright: The Challenges of Consistency, Consent, and Encouragement Theory,” Stanford Law Review 41 (1989). [↩]
23. the “case for copyright protection is weak”. Stephen Breyer, “The Uneasy Case for Copyright: A Study of Copyright in Books, Photocopies, and Computer Programs” (1970). [↩]
24. See his publications page; also my IP debate with him at KOL253 | Berkeley Law Federalist Society: A Libertarian’s Case Against Intellectual Property [↩]