From my blog, a couple years ago:

From Scribd:
mpaa-infographic

Others charts and graphics at Intellectual Property Charts, Graphs, Graphics, Diagrams.

As reported on Deadspin, Boise State has long used a unique blue turf, and apparently even has a trademark on the term “Blue Turf.” When Oxford High recently installed a $300,000 blue turf field, Boise State’s general counsel warned them not to use the term “Blue Turf” “in promoting the field and events on it.” So… Oxford can have a blue turf. But they better not say that they do!

Trademark insanity.

(H/t Skip Oliva)

Well, the money to buy that many–by taking $500 million of Google’s money for running ads that helped American consumers evade the FDA’s protectionist restrictions on their freedom to buy Canadian pharmaceuticals. That amoung of money could have been used to purchase about 1760 patents, at $284,000 each, approximately the price Google paid recently in the Motorola Mobility acquisition (or about 23 patents, depending on how you figure it — see Google pays $22 million per patent to defend itself).

I’m inclined to view the FDA’s limits on drug freedom as another type of intellectual property right, even though FDA regulations are not usually classified this way. But then, neither are reputation rights (defamation and libel), even though reputation rights are types of IP too, along with patent, copyright, trademark, trade secret, and miscellaneous special-purpose (read: special-interest) legislation like boat-hull designs and semiconductor maskwork rights. Like patent and copyright, FDA regulations drive up costs; restrict innovation; limit property rights; hamper free trade, competition, and emulation on the market; and set up oligolized cartels immunized from competition.

Viewed this way, the state’s stealing $500 million from Google based on FDA regulations is just additional injury done to Google in the name of IP or IP-like state regulations–other injury includes the billions Google is now spending on patents to defend itself, plus the current patent attacks on the Android platform by its competitors. Compared to those other costs, half a billion is chump change. Sure, it could be used to do real innovation, to hire thousands of people, or given to shareholders to use as they see fit–but it’s obvious the state doesn’t give a damn about consumers or citizens except to keep them stupid and compliant and paying taxes to keep the ruling class in the lifestyle to which they are accustomed (as Lew Rockwell put it in a recent interview).

Great post on the bankruptcy of any defenses of IP, by Mike Masnick on Techdirt:

Debate On Software Patents Fails To Convince Silicon Valley That Patents Increase Innovation

from the not-a-surprise dept

Yesterday, I went to the Computer History Museum in Silicon Valley for a lunchtime debate on software patents. It was one of those things where an official “motion” was put forth, and then people voted before and after to see if the debate changed anyone’s mind. In this case, the motion was simple: “software patents encourage innovation.” Arguing for the motion was Bob Zeidman, a consultant/writer who sells software for… analyzing intellectual property. Arguing against the motion was Edward Lee, a Berkeley CS professor. The audience, as is (unfortunately) typical at the Computer History Museum definitely skewed “older.” I ended up at a table with some guys who worked at IBM many decades ago. There were also a fair number of patent lawyers in attendance.

There’s this view outside of Silicon Valley that folks here love patents, but in my experience, most people don’t seem to like patents at all. They get in the way of actually innovating — as we’ve shown time and time again — and the thing that Silicon Valley folks like more than just about anything else is building something cool. The idea that someone else can sue you for building something cool just seems incomprehensible.

Before the debate, the vote was already against the motion: 64 people voted for the motion (35.7%). 89 people voted against (49.7%). Another 26 didn’t vote at all.

The debate itself struck me as rather tame. Niether side really made as strong an argument as they could. Obviously, given what I write about here, and the rather staggering evidence that’s out there that the patent system tends to do a lot more harm than good, I was inclined to support Lee “against the motion.” But even there, it felt like he could have made much stronger arguments. For the most part, he just repeated claims from James Bessen and Michael Meurer’s book Patent Failure. It’s an excellent book and completely worth reading, in large part because it cites dozens of studies to show how the costs of the patent system greatly outweigh its benefits. It’s definitely a good starting point, but there’s a lot more out there that let’s you take their argument further, and I was a bit disappointed that Lee didn’t do so (though the debate format is a tough one). For example, Lee repeated a few key claims from Patent Failure, such as the idea that patents don’t work well as property, because the reason “property” works is because there are clear boundaries. But, with patents, the boundaries are (often intentionally) unclear, meaning more and more litigation. Good property rules should mean less litigation.

But all that presumes that property rights make sense around ideas. And there’s a strong argument that they don’t. I also would have liked at least some more discussion about the fact that so many patent lawsuits involve work that was independently invented. Lee mentioned it in passing, but it’s a key point in this debate, and it wasn’t highlighted nearly enough.

Lee did get in a few good one-liners, though, which the crowd appreciated. He noted that in Silicon Valley today, if you actually do something well, you’re guaranteed to get sued for patent infringement. Separately, he argued that patents tend to encourage more patents, rather than innovation. The one point he “conceded” was that patents did seem to encourage “innovation” in one area: Zeidman’s arena of writing software to analyze patents.

The one point he made that struck me as compelling and not discussed nearly enough was his response to the common claim that patents are all about “disclosure,” and without patents everything would be trademarked.¹ There are a bunch of good responses to this that we’ve discussed in the past, but he noted (1) that patents don’t seem to disclose much that is useful to a software developer and (2) that the real purpose of “disclosure” is education, and there are better ways to educate software developers. I hadn’t made that connection between disclosure and education before, and it’s a good point.²

As for Zeidman, not surprisingly, I found his arguments completely uncompelling. He kicked off with an attempt to play to the ego of the crowd, asking them how many had programmed stuff, and how many of those people felt that “just anyone could do that.” He was a little surprised that some people said, yes, just about anyone could program what they programmed, and accused the audience of being too modest. But, really, this argument is a total non-starter. He used it to claim that creating software is a “creative skill.” That’s true, but it’s meaningless. The patent system has nothing to do with encouraging creativity. And, more importantly, the very crux of this particular debate for many people is that software is already covered by copyright. And the whole “creative” part is the part that copyright covers. So what does that have to do with patents? I submitted that as a question, but the moderator didn’t ask it. The whole argument made no sense in the framework of what was actually being debated.

The other thing that caught my attention was that Zeidman tried to brush off the argument of patent trolls suing the companies who actually innovate, by suggesting it’s not really a big problem. He specifically stated that “less than 2%” of patent lawsuits involve patent trolls. That number struck me as ridiculously low, so I first asked folks on Twitter if that could possible, and received back a few responses, including from Mark Lemley, who said the real number is between 25 and 40% depending on how you count. Separately, a few folks pointed me to a research paper by Colleen Chien, which suggests the number has been growing recently, and agrees with Lemley’s basic range. For example, from 2006 to 2008, defendants sued by trolls represented 36% of all defendants sued.³

After the event I went over to ask Zeidman about the 2% number, and he claimed that he actually thinks that estimate is too high. He mentioned that he cited the source in the Wall Street Journal, but the only citation I can find that seems to match is a claim that “roughly 2%” of patents end up in court. Perhaps he means that he used the 2% number from the Wall Street Journal somewhere else, but the fact that only 2% of patents end up in court (which seems ridiculously high, actually) has nothing to do with how frequently trolls are suing companies.

Anyway, after an hour-long debate, another vote was taken, and since a bunch of folks showed up in the middle, the numbers were higher across the board: 70 people were for the motion that software patents are good for innovation, 112 were against and 42 didn’t vote. On a percentage basis, those supporting software patents dropped to 31.3% and those against rose marginally to 50%. Given the fact that there were a fair number of patent lawyers in attendance (one sitting at my table mocked the whole debate because no one defined software patents, and then argued that Professor Lee was probably a hypocrite, because while he contributed to open source software, he probably wanted to get paid for his book), and they seemed to be the most vocal in supporting software patents, it seems likely that of the actual developers in the audience, well more than 50% were against patents for software.

1. I think he means patented. That’s okay, IP is so unnatural that neither its cheerleaders nor critics really understand it. See IP Proponents Do Not Even Know The Difference Between Patent, Copyright, Trademark …. —SK  [↩]
2. See  “The” Purpose of Patent Law: “The idea that a patent represents an exchange of protection for disclosure makes no sense, except perhaps with respect to process patents. The product itself, not the patent papers, usually discloses things. Inventors want and need patents only when disclosure is inevitable in the absence of protection. When the product can be sold without disclosure, the manufacturer can use trade secret law to protect its contribution, getting even better protection—not only perpetual, but also guarding by secrecy against infringement. Infringement is difficult to detect and penalize; why disclose anything in exchange for what is at best a limit on the duration of your returns? Lawyers use the utmost skill to draft patent applications so that they do not disclose enough to practice the invention, and the omitted details frequently are vital. Patents thus are valuable when the product itself, not the papers filed in the Patent Office, discloses the invention.” Quoting Frank H. Easterbrook, “Intellectual Property Is Still Property,” Harv. J.L. & Pub. Pol’y 13, no. 1 (Winter 1990): 108–118, pp. 109–110. [↩]
3. It is true that patent trolls are not the main problem with the patent system; neither are “bad” patents, and so on. It is good patents, asserted by practicing entities, that are the primary problem. See Patent Trolls, Bad Patents, and Incompetent Examiners are Not the Problem; Anti-patent-troll ads launch on radio and in print in 15 states: miss the big picture; Patent Trolls Are Preferable to “Practicing Entities”. But do not let this obscure the fact that the patent system, the costs of acquiring and defending patents, and the costs imposed by those asserting patents, including trolls, is significant. See, e.g., “Dean Baker: Patents Cost Almost $1 Trillion A Year”; “Patent Trolls” Cost Productive Companies $29 Billion in 2011, Stall Innovation, and Hurt Small Businesses; Patent Trolls Cost The Economy Half A Trillion Dollars since 1990; Haman Nature: None of us hate patent trolls nearly enough. In fact, all of IP has serious flaws that need fixing – or abolishing; HuffPo: Patent Trolls Are Killing People — Literally. —SK [↩]

From the NYT: Chinatown Funeral Goods Bring Copyright-Infringement Arrest: “Paper imitations of luxury items are traditional at Chinese funerals as gifts for the dead, but a seller of cardboard handbags was arrested on copyright-infringement charges on Tuesday.” Read more>> (H/t Rob Wicks.)

I think it’s trademark, not copyright, but anyhoo. The IP po-po came in and arrested this guy for selling cardboard imitations of Louis Vuitton handbags and Gucci loafers. Took him to jail.

Mises blog; archived comments below.

I’ve noted before the “tension” between federal antitrust law (which penalizes private “monopolies”, while excusing real monopolies, i.e. those formed by state agencies and law) and patent law (in which the state grants private monopolies to some companies to allow them to avoid “unbridled” competition for 17 or so years).

In some previous posts and lectures, I’ve noted that if the FTC were to pursue various companies using state-granted patent monopolies to form cartels and oligopolies, this would not be the worst miscarriage of justice.¹ Not that we want the FTC to exist at all, or to exercise powers not authorized by the Constitution or federal law. But if it aims its fire at the patent office and patents granted by its sister agencies in the state, this is not something a libertarian ought to weep over. We might be worried that the FTC exists, or that it feels free to disregard constitutional or statutory limits on its powers, but not about its choking back on patent monopoly power.

But pro-IP libertarians don’t have this perspective. They don’t like the FTC taking away monopoly power grants by their sister agency, the PTO. In response to an FTC proposal on patent notice and remedies, “The Evolving IP Marketplace: Aligning Patent Notice and Remedies with Competition,” pro-IP libertarian Richard Epstein,² and two other co-authors argue, in “The FTC’s Proposal for Regulating IP through SSOs Would Replace Private Coordination with Government Hold-Up,” that if the FTC intervenes in IP, it will “distort the operation of the intellectual property (IP) marketplace in ways that will hamper the innovation and commercialization of new technologies.” Such a conclusion can be reached only if one assumes that IP does not distort innovation (false)³ and that IP, when left alone by the rapacious FTC, encourages net innovation (false).

Epstein’s article also worries that the FTC intervention in IP “would seriously undermine capital formation, job growth, competition, and the consumer welfare the FTC seeks to promote.” IP itself undermines all these things, so it is hard to see how another federal agency somehow ameliorating or blunting the effects of the monopoly privilege grants by another federal agency would be bad. And, of course, it is not true that the FTC “seeks to promote” capital formation, competition, consumer welfare, etc. This is confusing the propaganda spouted by a criminal state agency with its real function and nature.

Yes, the FTC should be abolished. But not because its turf overlaps that of the USPTO. Limiting patent rights may be the one non-horrible thing the FTC does.

This is yet another example of how support for IP can lead to a confused analysis of the state and policy. For example, the support of patents has led some libertarians, including Epstein, Doug Bandow, and Michael Kraus, to oppose free trade when it comes to drug reimportation that threatens the patent-monopoly profits of domestic corporations.⁴

[mises]

Archived comments:

Dale B. Halling August 25, 2011 at 10:16 am

nate-m August 25, 2011 at 10:30 am

A patent is a property right it is not a monopoly.

Maybe not the patents you want. But we are talking about actual patents that get created by the patent office, which seem to be very different from what you think they are.

Patents in the USA are absolutely monopoly grant privileges.

Like all property the source of the property right is creation.

Actually no property right is like that at all. Completely misleading and wrong statement.

If someone else were to create the invention they could obtain a patent (property right) in the invention also.

No, actually they can’t. The patent system allows you to successfully sue over acts of independent creation that infringe on your patent. It happens _all_the_time_. It’s very frequent. It may actually be the source of most patent lawsuits today.

This is like all other property rights and not at all an arbitrary government grant.

The fact that it does not work at all like you think, but actually acts like you say that the government grant behaves, it does helps to undermine your argument.

Finally, a patent is freely alienable, it can be sold, lease, assigned, etc. Again this is not true of government granted monopolies.

There is absolutely nothing intrinsic to government grants that says that they cannot be transferred. It depends on the legal details with each grant. Your just making stuff up now.

Take a ‘taxi token’. This gives you the ‘property right’ to own the ability to provide taxi services in certain cities. Often these tokens can be transferred, sold, or leased to other people.

patents are NOT private property rights:

They are grants of privilege. Monopoly grants that are designed to provide so-called ‘economic rights’ that are just like the rights granted to social security or special privileges for unions. Rights created and enforced by government fiat in attempt to improve the economy or make up for some sort of perceived deficiency in the market.

REPLY

Stephan Kinsella August 25, 2011 at 10:41 am

Just to those lurking: Halling is a patent lawyer who routinely shills for the existing system that butters his bread. He is scientistic and never had sincere normative arguments. He reasons like a technocratic monist engineer bereft of any comprehension of ethical reasoning–thinking it’s sufficient to trot out statist-positivist bromides his law professors regurgitated to him.

Now:

A patent is a property right it is not a monopoly.

As for its being a monopoly: see Are Patents “Monopolies”?. One would not expect Halling, ignorant of economics and uninterested in genuine discourse, to have a clue about this. The only real monopolies are those granted by the state. Halling and his fellow IP protectionists are in favor of the state granting monopoly privileges to people to protect them from competition.

Of course IP is not a real property right. This is just a propaganda term used to sell these privileges to a naturally suspicious public. See Intellectual Properganda, noting:

state-granted privileges like patent and copyright were not originally called property at all. This was a latter innovation, used for propaganda purposes. This was observed by Fritz Machlup and Edith Penrose in two seminal studies:

Those who started using the word property in connection with inventions had a very definite purpose in mind: they wanted to substitute a word with a respectable connotation, “property”, for a word that had an unpleasant ring, “privilege”.

[Fritz Machlup & Edith Penrose, “The Patent Controversy in the Nineteenth Century,” Journal of Economic History 10 (1950), p. 1, 16]

While some economists before 1873 were anxious to deny that patents conferred “monopolies”–and, indeed, had talked of “property in inventions” chiefly in order to avoid using the unpopular word “monopoly”–most of this squeamishness has disappeared. But most writers want to make it understood that these are not “odious” monopolies but rather “social monopolies”, “general welfare monopolies”, or “socially earned” monopolies. Most writers also point out with great emphasis that the monopoly grant is limited and conditional.

[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)]

Like all property the source of the property right is creation.

Creation is not a source of property at all. You didn’t create your body, yet you ought to own it. If you find an unowned field, and build a farm, you own it because you were first to appropriate it, not because you created the land. Creation means transforming things you own, into more valuable configurations. Creation presupposes you already own the factors that you transform. Creation comes after ownership. It does not give rise to property rights. Creation is not a source of property rights. This is a common mistake.

If someone else were to create the invention they could obtain a patent (property right) in the invention also. This is like all other property rights and not at all an arbitrary government grant.

Of course it is arbitrary, for any number of reasons–including the term, the criteria, the process used, and the fact that the patent one inventor gets lets him stop other, independent inventors from using the invention they came up with on their own.

Finally, a patent is freely alienable, it can be sold, lease, assigned, etc. Again this is not true of government granted monopolies.

It’s true of this one. What kind of reasoning is this?

In addition, our Modern antitrust law turned

Why capitalize “Modern”? Today’s college graduates and patent lawyers are really hacks.

the law against monopolies on it head. The Statute of Monopolies limited the power of the Crown (government) to interfere with private property rights.

Not enough. It left the power of the state to grant monopolies for inventions.

The Statute of Monopolies excluded patents for inventions because they result from the creative act of the inventor and therefore are property rights.

This is not an argument. It’s just assertion. The kind of rhetoric you would expect from a patent shill.

REPLY

Chris Rhodes August 25, 2011 at 11:59 am

It pains me to think that I was once a Pro-IP libertarian without even realizing the inherent contradiction between the two.

“That piece of paper there, is it your property?”
“Why yes, yes it is.”
“And this piece of paper here, would you say that it’s my property?”
“Most certainly.”
“Okay then, I’m going to write a sentence on my piece of paper. See here?”
“Yep.”
“Alright, now I want you to try and write the same thing on your piece of property.”
“Sure, I’ll just . . .”
“STOP! IF YOU SO MUCH AS WRITE ONE SYLLABLE DOWN ON YOUR PROPERTY, I WILL HAVE MEN WITH GUNS INVADE YOUR HOUSE, STEAL ANYTHING YOU HAVE OF VALUE TO GIVE TO ME, KIDNAP YOU, AND THROW YOU INTO A CAGE FOR SEVERAL YEARS!”

Now, doesn’t that seem like a fine “libertarian” position? *puke*

REPLY

Peter Surda August 25, 2011 at 12:10 pm

Dale,

A patent is a property right it is not a monopoly.

Patents contradict property rights (or, in the corner cases, are redundant). If you disagree, show me a counterexample.

Furthermore, the concept of monopoly is overused, nevertheless since I last debated with you I came up with a more coherent definition that fits economic science: monopoly is the concept of making mutually inexclusive actions illegal.

REPLY

Chris Rhodes August 25, 2011 at 12:03 pm

1. E.g., Price Controls, Antitrust, and Patents and Intellectual Property and Economic Development.; also IP vs. Antitrust; State Antitrust (anti-monopoly) law versus state IP (pro-monopoly) law;  The Schizo Feds: Patent Monopolies and the FTC; The Schizophrenic State; Intel v. AMD: More patent and antitrust waste. [↩]
2. See “Richard Epstein on ‘The Structural Unity of Real and Intellectual Property‘”; The Structural Unity of Real and Intellectual Property (video); The Disintegration of Intellectual Property? A Classical Liberal Response to a Premature Obituary. [↩]
3. See Milton Friedman on the Distorting Effect of Patents; The Forgotten Costs of the Patent System. [↩]
4. See Ideas Are Free: The Case Against Intellectual Property; Pilon on Patents; Drug Reimportation; Cato on Drug Reimportation; and Patents, Prescription Drugs, and Price Controls. [↩]

As noted in my post Intellectual Property Advocates Hate Competition,  IP proponents support these monopoly privileges on explicitly anticompetitive grounds. Take this explicit opening passage in an article by an ardent IP advocate, Jerome H. Reichman, a law professor at Duke:

Governments adopt intellectual property laws in the belief that a privileged, monopolistic domain operating on the margins of the free-market economy promotes long-term cultural and technological progress better than a regime of unbridled competition.

… Intellectual property laws typically provide qualified creators with temporary grants of exclusive property rights that derogate from the norms of free competition in order to overcome the “public goods” problem inherent in the commercial exploitation of intangible creations.¹

This opposition to “unbridled” competition sounds like something Ayn Rand might have mocked in Atlas Shrugged. Oh, wait. She did: the villains enact the “Anti Dog-eat-dog rule”. From Wikibooks:

Anti-dog-eat-dog Rule

The Anti-dog-eat-dog Rule is passed by the National Alliance of Railroads in section 145, allegedly to prevent “destructive competition” between railroads. The rule gives the Alliance the authority to forbid competition between railroads in certain parts of the country. It was crafted by Orren Boyle as a favor for James Taggart, with the purpose of driving the Phoenix-Durango out of Colorado.

Sad that Rand, who rightly mocked the hostility to “unbridled” market competition in Atlas with her “Anti Dog-eat-Dog” rule, found a way to endorse IP, the very purpose of which is to prevent a free market and its “unbridled competition.”

[Mises cross-post; archived comments]

1. Reichman, “Charting the Collapse of the Patent-Copyright Dichotomy: Premises for a Restructured International Intellectual Property System,” Cardozo Arts & Ent. L.J. 13 (1995): 475; see also IP Rights as Monopolistic Grants to Overcome the Public Goods Problem. [↩]

From “Jesus Diaz” on Gizmodo:

We Hope Apple Wins the Patent Wars

Read more>>

This is about Apple using its patents against Android, resulting in: “A Dutch court has banned all trading of Samsung Galaxy S, Galaxy S II and Ace across most countries in Europe.” Unless the author is being sarcastic, this is one of the most dishonest, disgusting things I’ve read in some time. What a horrible defense of patent protectionism. Gizmodo is way behind the curve on this. Other tech-savvy people are realizing how horrible and protectionist and anti-competitive and unjust patents are. I hope Gizmodo goes down in flames, and burns in bankruptcy hell.

From Mike Masnick at Techdirt:

Newspaper Claims Satirical Blogger Mentioning Its Name Is Trademark Infringement

from the get-better-lawyers dept

Gatehouse Media — a smaller newspaper chain who actually had done some fairly innovative online things in the past — has really become rather crazy when it comes to intellectual property lately. First it sued the NY Times for linking to it, then it threatened a forum site for linking to it with headlines and ledes (which most people consider to be fair use). Now it’s going even further. Keyop points us to the news that the lawyers for one Gatehouse paper, the Utica Observer Dispatch have threatened a local satirical blogger with trademark infringement claims for the great sin of mentioning the name of the Utica Observer Dispatch.

We wish to advise you that the name, “The Observer Dispatch,” that you are using is the property of GateHouse Media, protected by trademark and past usage rights. Your use of such name constitutes infringement of GateHouse’s rights under federal, state and common law. Our proprietary rights in such name include the right to restrict the use of the name. It is important that we exercise our right to protect our name. Its serves as an important and distinctive representation of the origin of our products as well as the goodwill of GateHouse Media.

The blogger, Ray Jadwick, definitely makes fun of the Utica Observer Dispatch on his site, but it certainly doesn’t appear to be trademark infringement. Making fun of your paper isn’t likely to confuse even a moron in a hurry.

From the Public Patent Foundation:

Farmers and Seed Distributors Defend Right to Protect Themselves From Monsanto Patents

NEW YORK – August 11, 2011 – The eighty-three family farmers, small and family owned seed businesses, and agricultural organizations challenging Monsanto’s patents on genetically modified seed filed papers in federal court today defending their right to seek legal protection from the threat of being sued by Monsanto for patent infringement should they ever become contaminated by Monsanto’s genetically modified seed.  The Public Patent Foundation (PUBPAT) represents the plaintiffs in the suit, titled Organic Seed Growers & Trade Association (OSGATA), et al. v. Monsanto and pending in the Southern District of New York.  Today’s filings respond to a motion filed by Monsanto in mid-July to have the case dismissed.

“Rather than give a straight forward answer on whether they would sue our clients for patent infringement if they are ever contaminated by Monsanto’s transgenic seed, Monsanto has instead chosen to try to deny our clients the right to receive legal protection from the courts,” said Dan Ravicher, PUBPAT’s Executive Director.  “Today’s filings include sworn statements by several of the plaintiffs themselves explaining to the court how the risk of contamination by transgenic seed is real and why they cannot trust Monsanto to not use an occurrence of contamination as a basis to accuse them of patent infringement.”

Plaintiffs Bryce Stephens, who farms in Kansas, Frederick Kirschenmann, who farms in North Dakota, C.R. Lawn, who is founder and co-owner of Fedco Seeds in Maine, Don Patterson of Virginia, and Chuck Noble, who farms in South Dakota, each submitted declarations to the court describing their personal experiences with the risk of contamination by genetically modified seed and why those experiences have forced them to bring the current suit asking the court to declare that Monsanto could never sue them for patent infringement if they were ever contaminated by Monsanto’s GMO seed.  As summarized by the accompanying brief filed by PUBPAT on the plaintiffs’ behalf, “Monsanto’s acts of widespread patent assertion and plaintiffs’ ever growing risk of contamination create a real, immediate and substantial dispute between them.”

Twelve agricultural organizations also filed a friend-of-the-court amici brief supporting the right of the plaintiffs to bring the case.  In their brief, the amici describe some of the harmful effects of genetically modified seed and how easily GMOs can contaminate an organic or conventional farmer’s land.  The organizations filing the amici brief were Farm and Ranch Freedom Alliance, Biodynamic Farming and Gardening Association, Carolina Farm Stewardship Association, Ecological Farmers of Ontario, Fair Food Matters, International Organic Inspectors Association, Michigan Land Trustees, Natural Environment Ecological Management, Nebraska Sustainable Agriculture Society, Organic Council of Ontario, Slow Food USA, and Virginia Independent Consumers and Farmers Association.

The brief filed by the plaintiffs in opposition to Monsanto’s motion to dismiss is available here.

The amici brief filed in support of the plaintiffs is available here.

More information about PUBPAT’s suit against Monsanto’s seed patents can be found at PUBPAT > Monsanto Seed Patents.

From Timothy Geigner at Techdirt:

Author Says eBooks Will Hurt Authors Because Of Royalty Rates

from the but-the-percentages-say-otherwise dept

Opinions on the emergence of eBooks in the modern era come with all manner of widely varied opinions. We saw J.K. Rowling go from staunchly refusing to offer her works as eBooks to routing around her publisher and offering them directly to her fans. Barry Eisler turned down a huge publishing contract to self-publish his eBooks, even as the Mystery Writers of America were telling Joe Konrath, Eisler’s friend, self-publishing meant he wasn’t a “real author”. And, of course, we have the always prevalent opposed viewpoints of the benefits of carrying your digital library everywhere versus the preference for the look and feel of a physical hardcopy tome.

But one argument I haven’t heard before (and I spend a decent amount of time reading and learning about the publishing world, for obvious reasons) is that eBooks are dangerous to the future of young authors because the royalty rates won’t support them making a living. That’s theargument Graham Swift made in an article in The Telegraph by Nick Collins. Graham is quoted as saying:

“The e-book does seem at the moment to threaten the livelihood of writers, because the way in which writers are paid for their work in the form of e-books is very much up in the air. I think the tendency will be that writers will get even less than they get now for their work and sadly that could mean that some potential writers will see that they can’t make a living, they will give up and the world would be poorer for the books they might have written, so in that way it is quite a serious prospect.”Swift is an award-winning author and, as such, I assume he’s as or more informed about the publishing world than I am, but I’m having trouble rectifying his speculation on declining royalty rates for eBooks with how such royalties are handled now. Unfortunately, because there is some variance in how royalties are handled in the publishing world, particularly with fiction, there are some distinctions to be made with how this all works.

First, let’s quickly look at royalties offered in a standard publishing contract through a mainstream press. Hardcover royalties are typically between 10% and 15%, with some variance in the contract based on the number of units sold. Paperback royalties are typically between 6% and 9%, usually also with breaking points based on sales. Meanwhile, the standard eBook royalty rates tend to be much higher, anywhere between 25% and 50%. Now, Graham appeared to be speaking of the future decline of eBook royalty rates, but the general trend with established publishers has been for those rates to rise rather than fall, recently.

Now, as everyone is aware, the emergence of eBooks has coincided with a boom in the self-publishing industry. I’m going, for the sake of this argument, to set aside true vanity publishers with awful reputations in the publishing world. Some authors out there will tell you horror stories about operations like Publish America, but they have an equally bad reputation when it comes to both hardcopy books and eBooks. Instead, let’s deal with how royalties work for self-publish eBook operations like Lulu and the Amazon Kindle market. As someone who has published on both platforms, I’m very familiar with how royalties work with each.

With Lulu, there is some wiggle room for authors to set their own retail price and, therefore, royalty for physical books. The default settings come to something around 9% for hardcopy books. That same default setting for eBooks? Roughly 55% in royalty for the creator. Creators offering up eBooks on the Kindle Direct Publishing platform can expect their royalties to start at 35% (although there are some options that can bump that royalty to 70%, depending on how much the author wishes to sell their eBook for).

And none of that even takes into account authors who are cutting out the middlemen with eBooks entirely and offering up their works with something like a PayPal account, yielding royalties for eBooks effectively somewhere around 75%. This is a sector of authors that’s only going to grow, as we’ve discussed here before. The beauty of the eBook is that an author no longer has to worry about the single most difficult aspect of getting his or her work to the reader: the physical production of the printed book. With that barrier gone, it seems as thoughmore young writers will find themselves suddenly able to enter the market, not fewer.

So, perhaps Swift knows something I don’t, but everything I read seems to indicate that eBooks are going to result in options for higher royalties, not lower. So I have to wonder where this fear comes from?

From The Federalist No. 43, the only reference to the patent and copyright clause in the Federalist Papers: Madison “argues”: “the utility of this power will scarcely be questioned.” Well, then, that settles it! No need for studies or empirical evidence. A hunch, a handwave, is good enough!