[NOTE: THIS POST IS NOW OUT OF DATE: SEE INSTEAD KOL164 | Obama’s Patent Reform: Improvement or Continuing Calamity?: Mises Academy (2011)]

Last  Friday, I conducted a Mises Academy Webinar discussing the America Invents Act, signed into law Sept. 16 by President Obama. I discussed the webinar in a Mises Daily article, Obama’s Patent Reform: Improvement or Continuing Calamity? and discussed the AIA in further detail in The American Invents Act and Patent Reform: The Good, the Meh, and the Ugly.

In the webinar, I:

1. summarized the basic problem with patent law from a free-market perspective;
2. presented a series of real patent reforms that could make significant improvement in patent law (short of abolition);
3. explained and critiqued the relevant changes made by the America Invents Act;
4. briefly summarized other imminent IP legislation and treaties on the horizon; and
5. responded to questions from attendees.

The audio of the webinar is available at: Kinsella Webinar: Obama’s Patent Reform (mp3), and streaming below; and the slides used are provided below as well.

[podcast]http://www.stephankinsella.com/wp-content/uploads/media/kinsella-mises-academy-w3-obamas_patent_reform.mp3[/podcast]

Samsung, Apple continue patent dispute: Rival companies filed claims over 3G licenses, tablet features:

Samsung Electronics and Apple Inc. continued their ongoing patent war Monday at hearings in Australia and the Netherlands.

If this is what people think capitalism is supposed to be about, no wonder they hate it.

See Douglas Green, **BREAKING NEWS** USMC files DMCA against content creators in Second Life, writing in Examiner.com: “The United States Marine Corps has filed a DMCA (Digital Millenium Copyright Act) notice against several Second Life residents who were recreating artifacts and uniforms bearing the USMC logo.” (h/t Skip Oliva)

• KOL164 | Obama’s Patent Reform: Improvement or Continuing Calamity?: Mises Academy (2011)
• Patent Reform is Here! O Joy!
• The Mainstream Patent Pendulum Swings Back
• “Obama’s Patent Reform: Improvement or Continuing Calamity?,” Mises Academy webinar
  • audio and slides available at My Webinar on the America Invents Act
• discussed in my article “Obama’s Patent Reform: Improvement or Continuing Calamity?,” Mises Daily, Sep. 23, 2011

More on the outrage of plant and seed patents: from the Mother Nature Network: Monsanto wins lawsuit against Indiana soybean farmer: “Monsanto claimed intellectual property infringement when a farmer used the company’s patented seeds from a commodity seed bag. … “. Some excerpts:

Monsanto Co., the world’s largest seed company, has prevailed in another lawsuit against a U.S. farmer, earning a ruling from a federal appeals court that protects Monsanto’s interests even when its patented seeds are sold in a mix of undifferentiated “commodity” seeds.

The U.S. Court of Appeals for the Federal Circuit in Washington issued its ruling Wednesday, affirming the lower court decision that favored Monsanto.

The St. Louis, Mo.-based company sued Indiana soybean farmer Vernon Bowman in 2007, accusing Bowman of patent infringement for planting and saving seeds that contained Monsanto’s genetically altered Roundup Ready technology even though Bowman said he bought those seeds as part of a mix of commodity seeds.

Commodity seeds come from farms that use Roundup Ready technology as well as those that do not without differentiation. No licensing agreements are required with the sale of such seeds.

Monsanto restricts grower use of its licensed Roundup Ready seed to a single commercial crop season. Roundup Ready seeds tolerate spray treatments of Monsanto’s Roundup herbicide.

The court found that while the technology agreements Monsanto requires growers to adhere to forbids farmers from selling the progeny of Roundup Ready seeds, those agreements do not extend to second-generation seed.

In fact, Monsanto authorizes the growers to sell their second-generation seed to grain elevators as a commodity and does not require restrictions on grain elevators’ subsequent sales of that seed, the court said.

But that still does not give growers a green light to replicate Monsanto’s patented technology by planting it in the ground to create “newly infringing genetic material, seeds and plants,” the court found.

“The attempt to limit the applicability of patent rights was again squarely rejected by the court,” Monsanto said in a statement.

See also another Monsanto case in Canada from a few years ago:

Monsanto Canada Inc. v. Schmeiser [2004] 1 S.C.R. 902, 2004 SCC 34 is a leading Supreme Court of Canada case on patent rights for biotechnology. The court heard the question of whether growing genetically modified plants constitutes “use” of the patented invention of genetically modified plant cells. By a narrow 5-4 majority, the court ruled that it does. The case drew worldwide attention.

Mike Masnick Techdirt post:

Author Sues Production Company For Copyright Infringement For Changing The Script It Optioned From Him

from the moral-rights-through-contract dept

While significant parts of the rest of the world include a “moral rights” component to copyright (which covers things like proper attribution), the US has always avoided it — even though it’s supposedly required by the Berne Convention, of which the US is a participant. The US has mainly gotten around this because it’s the US and it ignores international agreements when it wants to — but also because it put in a tiny bit of moral rights in extremely limited circumstances that are so rare you’ll almost never, ever hear about them. However, it does appear that some are trying to sneak in a form of moral rights via contract.

Copycense points us to the news of a writer, Matthew Jones, who is suing the people who optioned his screenplay (which was based on his own novel, Boot Tracks) for changing the screenplay without his permission. He apparently wrote into the contract that such changes could not be made without his permission — and yet the screenplay was changed to help get funding. There’s an obvious contractual breach in there, but Jones is also claiming copyright infringement, suggesting that, by breaking the agreement, they were also creating an unauthorized derivative work. In this case, it’s a little more confusing, because there’s some question as to when the producer and director actually exercised the option to buy the screenplay/make the film. Either way, it may make for an interesting case and it makes me wonder if we’ll start to see more efforts by content creators to enforce such moral-like rights via contract.

I’ll be appearing tomorrow on Agora I/O? The Liberty Unconference, at 2pm EDT, at the channel “Open Source Agorism: Prosper Without Patents or Copyrights.” Tune in!

Update: Just finished. The video(s) are below. Here is what is amazing. I was set to do the show, using Justin.tv, but for some reason neither of my MacBooks would work with the Justin.tv interface. I saw an option for “mobile device.” It was 5 minutes to showtime. I quickly downloaded Justin.tv app on my iphone, got out a little iPod tripod I had never used, signed in, hit the record button, and walla–I was on Justin.tv streaming live, using my iphone. I was using my MacBook to watch it live, and to monitor questions typed on a facebook stream by the 45 or so participants. Quite amazing. (There are three videos b/c I had a couple of glitches/crashes and had to re-start my iPhone stream twice.)

Watch live video from Agora I/O: Peaceful Evolution on Justin.tv

Watch live video from Agora I/O: Peaceful Evolution on Justin.tv

Watch live video from Agora I/O: Peaceful Evolution on Justin.tv

Well does it, punk? Does it?

See Mike Masnick’s post One Entertainment Business Publication Sues Another For Copyright Infringement For Having The Same Stories.

From Robert Lockett, Jr.:

It looks like the Bluebook is now seeking to prevent the use of its citation standards from being implemented in computer code under the guise of copyright:  https://github.com/citation-style-language/styles/issues/53.  As a recent law grad, I find it amusing that I am apparently committing a crime anytime I use (too much of?) the Bluebook’s citation method, which they have fought to hard to get everyone to use.

As Hans-Hermann Hoppe observes in the Introduction to his book Democracy: The God That Failed, America’s unnecessary entry into WWI caused it to convert from “an old-fashioned territorial dispute” into “an ideologically motivated conflict” which “quickly degenerated into a total war.” This led to the harsh war reparations imposed on Germany (only paid off last year), which ultimately led to the rise of nationalism in Germany, Hitler’s rise to power, and WWII. At the end of WWII, even more reparations were imposed on Germany–this included the transfer of much property, including “industrial” and “intellectual” property, from Germany, as well as forced labor, i.e. slavery.

In one interesting phase of the aftermath of WWII, the US initiated “Operation Paperclip,” a program from 1945 to 1990–basically coextensive with the Cold War–designed to

recruit the scientists of Nazi Germany for employment by the United States in the aftermath of World War II (1939–45). It was conducted by the Joint Intelligence Objectives Agency (JIOA), and in the context of the burgeoning Soviet–American Cold War (1945–91); one purpose of Operation Paperclip was to deny German scientific knowledge and expertise to the USSR and the UK.

… Throughout its operations to 1990, Operation Paperclip imported 1,600 men, as part of the intellectual reparations owed to the US and the UK, some $10 billion in patents and industrial processes.

As noted in the Wikipedia article on WWII reparations by Germany, “The Allies confiscated significant values of German patents, copyrights and trademarks.”

As noted in Wikipedia general article on war reparations,

Beginning even before the German surrender and continuing for the next two years, the United States pursued a vigorous program to harvest all technological and scientific know-how as well as all patents and many leading scientists in Germany (known as Operation Paperclip). Historian John Gimbel, in his book Science Technology and Reparations: Exploitation and Plunder in Postwar Germany, states that the “intellectual reparations” taken by the U.S. and the UK amounted to close to $10 billion dollars.^[2] German reparations were partly to be in the form of forced labor. By 1947, approximately 4,000,000 German POWs and civilians were used as forced labor (under various headings, such as “reparations labor” or “enforced labor”) in the Soviet Union, France, the UK, Belgium and in Germany in U.S run “Military Labor Service Units”.

Wikipedia’s article on Bayer observes:

As part of the reparations after World War I, Bayer had its assets, including the rights to its name and trademarks confiscated in the United States, Canada, and several other countries. In the United States and Canada, Bayer’s assets and trademarks were acquired by Sterling Drug, a predecessor of Sterling Winthrop.

[UPDATE: ignore this post; see now KOL164 | Obama’s Patent Reform: Improvement or Continuing Calamity?: Mises Academy (2011)]

This Friday, Sept. 23, at 6pm Easter time, I’ll be teaching a Mises Academy Webinar discussing the America Invents Act, signed into law last Friday by President Obama. I discuss this webinar in a Mises Daily article today: Obama’s Patent Reform: Improvement or Continuing Calamity?.

In the webinar, I will:

1. summarize the basic problem with patent law from a free-market perspective;
2. present a series of real patent reforms that could make significant improvement in patent law (short of abolition);
3. explain and critique the relevant changes made by the America Invents Act;
4. briefly summarize other imminent IP legislation and treaties on the horizon; and
5. respond to questions from attendees.

As both proponents and opponents of patent law recognize, these issues are of crucial importance for innovation and our economy. If you are interested in learning about the current direction of patent policy, you may find this class of interest.

P.s.: If you are interested in taking this course but cannot afford it (it’s $20), please email me at [email protected].

[Update: also at Christian Science Monitor: Patent system cost the economy $0.5 trillion since 1990: Why the U.S. patent system is draining the nation’s money]

I have previously estimated that the patent system imposes at least $42 billion in net loss to the economy annually (Costs of the Patent System Revisited). As Mike Masnick notes in his Techdirt post Patent Trolls Cost The Economy Half A Trillion Dollars, a stunning new study by James Bessen, Michael Meurer, and Jennifer Ford, The Private and Social Costs of Patent Trolls, concludes that companies sued by patent trolls have lost $500 billion from 1990 to 2010, with increasing annual costs of late, on the order of $80 billion per year over the last four years. It’s not clear how much of this cost would overlap with my conservative $42 billion annual estimate, but obviously not all of it can, as the sum is greater; and it does not even address non-“troll” wealth-destroying patent battles such as the smartphone wars between Microsoft, Google, Apple, Samsung, Motorola, RIM, and others.

My $42 billion estimate was intended to be conservative. I’d venture that even an estimate of $100 billion a year of net loss in the US economy alone due solely to patents is still conservative. That’s at least a trillion dollars of net loss in innovation and economic productivity every decade, people. A trillion here, a trillion there, pretty soon you’re talking serious money.

[Mises]

Update:  “Patent Trolls” Cost Productive Companies $29 Billion in 2011, Stall Innovation, and Hurt Small Businesses

A while back I began to collect Absurd Arguments for IP. Well, we have another entry. As Mike Masnick explains in this Techdirt post, Insurers Suggest Podium & Stage Collapse Tragedies Are The Inevitable Result Of File Sharing?, there have been several stage collapses and similar accidents at music concerts and festivals. One insurer is blaming this on file sharing and piracy. The argument apparently goes something like this: piracy reduces CD and song sales. This puts greater pressure on bands to make money from giant concerts, with “giant podiums overloaded with video equipment and spots. The rain and the wind do not destroy more often than before, but when they fall, the damage is much greater.”

Uh, yeah. And lack of copyright law killed Dickens, by making him give too many public performances.