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The Anti-IP Entitlement Mentality

The Anti-IP Entitlement Mentality is a ridiculously confused “defense” of IP.

For example:

Whenever an issued patent interferes with this entitlement, the attackers hold it up as an example of how IP rights stifle innovation.  This is an easy sell to an audience that already believes in the entitlement to ideas they learned from others.  After all, one should be free to execute on unpatented ideas, and anything I can understand should not have been patented, right?

Notice the implicit indignation about the idea that people can use ideas they’ve learned from others! Why, how DARE they! DOWN WITH LEARNING!!

Our dullard goes on:

But that isn’t how things work in America. Our common law notion of property rights included the concept that the first to discover and claim previously undiscovered land would be entitled to a bundle of exclusive rights related to that land (among them, the right to exclude others form using it).

Right, because land is a scarce resource, and to permit it to be used without conflict, the first user is regarded as the owner.

Our intellectual property system followed a similar notion.

No it didn’t. It has nothing to do with Lockean homesteading. It is a pure policy tool. What is this guy jabbering about?

Since you can’t build (or even describe) a new device or improvement until you conceive of the idea,

Or, you know, you learn how to do it from others. But God forbid people learn!

invention (and ultimately, innovation) is physical labor that is necessarily preceded by mental labor.  Despite the clumsiness of the constitutional language, the American patent system rewards the first person who successfully engages the mental muscle to conceive of something new, provided that the mental labor is followed by the physical act of (at least) documenting the invention.

This is ridiculous. The patent systems in most of the world reward the first to file not the first to invent; and the US system is about to change to this too. Soon we will be first to file, not first to invent. Will our patent shills find a way to defend this too? The house says yes.

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From the NYPost. Notice that most people try to defend trademark on the grounds that the poor customer is being defrauded. Now they want to jail customers. Clearly they are not defrauded. And the councilwoman behind this even tries to blame knock-off manufacturers for terrorism and child exploitation. Amazing.

Bill would bag phony-purse buyers

By JOHN DOYLE

Last Updated: 11:05 AM, April 26, 2011

Posted: 12:46 AM, April 26, 2011

Pretty soon, it could be more than just the fashion police who have a problem with your shoddy knockoff bag, like this bogus Louis Vuitton.

Buyers could face a year in jail or a $,1000 fine under a proposed bill by a city councilwoman fed up with cheapskate tourists and Big Apple residents flooding her district in search of fake designer merchandise.

“We don’t want to be known as the place to come to get counterfeit goods,” said Councilwoman Margaret Chin, whose Chinatown district is ground zero for counterfeiters.

Under Chin’s bill, which is being introduced Thursday, shoppers caught buying any counterfeit product could be jailed or slapped with a fine of $1,000 — a little less than the price of Marc Jacobs’ frequently copied Baroque Quilting Mini Stam bag, which retails for $1,250.

… The punishment might seem draconian, but it’s necessary to curb the growing problem, she said.She pointed out that the money that counterfeiters rake in often funds other nefarious activities, such as terrorism and unsafe child-labor practices.

But try telling that to bargain hunters.

Christine Gambino, 21, of Staten Island — who was in Chinatown yesterday sporting a fake Louis Vuitton handbag that cost her $40 — vowed to continue to hit the neighborhood for counterfeit goodies.

“I’ll take a risk and sacrifice to look good and pay less,” she said.

Read more>>

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Intellectual property: an unnecessary evil

Jock Coats, who did the audiobook version of my Against Intellectual Property (and who attended my IP course at Mises Academy) has written a great post on the Adam Smith blog, in “honor” of “World Intellectual Property Day”.

Intellectual property: an unnecessary evil
Written by Jock Coats
Tuesday, 26 April 2011 16:49

Intellectual property rights – better thought of as intellectual monopoly rights – are an unnecessary evil. They are unnecessary because all their stated, utilitarian aims can be achieved by other means. They are an evil because granting artificial rights to non-property restricts everyone else’s property rights. They are more likely to be used to stifle the creativity, innovation, and emulation that underpins technological and cultural advance; and they concentrate wealth and power in the hands of privileged non-creators more interested in milking selected others’ efforts.

Dignifying them with the phrase “intellectual property” is a contemporary conceit to conceal crude market interference through state granted privilege with the flimsiest gossamer of respectability. The primary origins of patents lie in maintaining the state’s coffers, and of copyright in state censorship of ideas.

Property rights arise from a desire to prevent conflict over scare resources. Ideas, patterns, recipes and processes are non-scarce. Intellectual monopoly laws impose different time periods and restrictions. From time to time legislators arbitrarily decide to protect previously unprotected categories of invention. Even legislators then don’t regard them as genuine property, ownable in perpetuity by the first owner and their heirs until they chose to dispose of it.

However, many claim that, without intellectual monopoly, those with innovative and creative minds would not use those faculties, insufficiently rewarded for their creativity. This is by no means self-evident. If…

…why do we think they need state protection now? The plain truth is that because of the grip of the small number of media giants who control the production, marketing and distribution of their favoured artists, many more undiscovered artists subsist on live gigs in local venues. And because of the modish patent trolls who have no intention of ever exploiting their patents, many innovators never even know someone else “owns” an idea until the writ arrives end up broken.

19th century libertarians ranked Intellectual Monopoly as state created privilege that impoverishes the majority. We should heed them: they are still destructive, unnecessary, statist and evil.

Further reading:

Stephan Kinsella’s “Against Intellectual Property” at the Mises Institute (and an audiobook version of it by me)

Stephan’s thinktank, the “Centre for the Study of Innovative Freedom” (C4SIF)

Against Intellectual Monopoly” by Michele Boldrin and David Levine and the supporting website “Against Monopoly: Defending the Right to Innovate

…and if you are minded to do a bit more study on Intellectual Property from a libertarian perspective, though Stephan Kinsella’s Mises Academy course “Rethinking Intellectual Property: History, Theory and Economics” is coming to the end of its current run, you might keep an eye out for it running again.

April 26th is “World Intellectual Property Day”. Jock Coats blogs at OxFr33.

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The Evils of Real-World IP

This comment by nate-m on the Mises blog thread Mossoff: Why Should Business Leaders Care About Intellectual Property (Objectivism) is worth reposting in its entirety:

Also I’d like to remind everybody that while it’s all fine and dandy to debate a theoretical framework for ethical IP under libertarian dogma, the negative effects of existing IP law are large and wide ranging.

Right now there are lawyers and groups suing successful capitalists for products that the plaintiffs had no hand in creating and had produce no competitive product. There are millionaires right now that did nothing but sue other people for being successful.

IP laws are a multi billion dollar drain on our economy. This is stifling competition and favoring companies who invest in lawyers and bureaucrats over ones that invest in engineers and products.

Laws related to maintaining copyright are becoming increasingly draconian and punitive. People are being sued tens of thousands of dollars for distributing songs which can be listened to for free on any radio or downloaded for pennies from websites legally. Individuals are being threatened, harassed. DRM laws have ruined companies, caused people to be sent to jail for sharing nothing but information, and are a affront to property rights and personal liberty.

In a world were we now have the ability to freely share all of human knowledge and the collected works of all humans from all of recorded history with all people alive today… for pennies per person… we have governments propping up fascist laws to protect the profitability of a handful of politically connected corporations running obsolete business models that originated when we required people to actually print and physically transport media.

They are the buggy whip manufacturers of our time and their profitability is now enforced by law. Houses are raiding, property is seized, old women and families are terrorized by lawyers and law enforcement for their children breaking laws that harmed no person. The government is engaging in secret international negotiations to force these evils on third world nations and undermine constitutional protections. Obama and friends are seeking ways of leveraging copyright enforcement schemes for wiretapping and monitoring of individuals.

Companies are no longer able to produce hardware and software products freely. They need to pay patent fees, support design decisions that undermine the quality of their products, increase prices, and are forced to undermine the ownership rights of their customers. Corporations are using patents as shields to stifle innovation and competition.

The loss of individual liberty and economic activity directly and indirectly to IP and IP enforcement is staggering. It’s large, it’s ongoing, and it is increasing.

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Happy World Book and Copyright Day

Happy World Book and Copyright Day! No, I’m not kidding: “World Book and Copyright Day (also known as International Day of the Book or World Book Days) is a yearly event on 23 April, organized by UNESCO to promote reading, publishing and copyright. The Day was first celebrated in 1995.”

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Replies to Neil Schulman and Neil Smith re IP

From 2010:

As a supplement to the post The L. Neil Smith – FreeTalkLive Copyright Dispute:

My reply to Cathy, Neil Smith’s wife: http://forum.freekeene.com/index.php?topic=3502.msg39201#msg39201

Cathy, my only focus here is the claim that IP is justified. Neil’s latest articles is not a clear argument in favor, but it seems to rest on the idea that you own any pattern you create. But this is not a libertarian principle and in fact if people owned patterns they created then it would undermine all property in physical things. He implies we would have no innovation without IP–which is clearly untrue. We might have less, but not zero. So then the argument is we need IP to make sure we have more innovation. How do we know the value of that additional innovation is worth the cost of the IP system? How we do know even that higher level of innovation is enough? Some–even libertarians–think it’s not so they go even further and support tax subsidized innovation awards to spur even more innovation.

I am a patent lawyer, and a libertarian (and a huge fan of your husband’s novels). I used to be pro-patent, but when I searched for a more solid foundation for it, I finally realized I couldn’t, and that the reason was I was trying to justify the unjustifiable. Granting rights in ideas really means giving the idea-creator a veto-right over how other people use their own bodies and property. It’s simply unjustifiable. You do not own “whatever” you “create”–you own scarce resources for which you or an ancestor in title were the homesteader.

I’ve explained all this in detail in various works, such as “Intellectual Property and Libertarianism” and “The Case Against IP: A Concise Guide”, here http://www.stephankinsella.com/publications/#IP. [continue reading…]

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From May 2010:

Dear Mr. Bourne,

I’ve been enjoying your commentary on various Twit network podcasts for a while now. On the recent MacBreak Weekly, I found your exchange with Merlin Mann about open source interesting. I detect a whiff of libertarianism in your remark about the force of the state being used to enforce taxes–which I appreciate, as I’m a libertarian myself. I’m also a patent attorney and have written extensively about why patent and copyright law are anti-free market and unlibertarian (my reasons may be found at The Case Against IP: A Concise Guide, available at http://www.stephankinsella.com/publications/#IP).

You are right, in a way, that the free market will come into play here–but the power of patent and copyright holders is not a free market power. It is an artificial and unjust monopoly given to them by the state, which they then use in the courts to get the force of the state (as with tax collection) to extort money from third parties. So, given this monopoly power, yes, the free market will temper somewhat how much they can extort from people, but still, it’s unjust and greatly distorts the market. It also leads to hostility against the free market when people wrongly identify this state monopoly granting practice as part of the free market. [continue reading…]

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Patent Lawyer Mostly Agrees With Me

From Mises blog Jan. 2010. Archived comments below.

In response to my Reducing the Cost of IP Law, my friend and ex-colleague (and mentor) Steve Mendelsohn, a patent lawyer in Philadelphia, wrote me the following. N.B.: Steve is not a libertarian but is honest and smart, unlike patent shills (he’s also an excellent patent attorney, if you need one). Here’s an edited version of his comments, posted with his permission (for comments from another honest patent lawyer, see here):

I agree with much of what you say and don’t necessarily disagree with most of the rest.  For example, I agree with you that we don’t know whether the patent system is doing what it says it’s doing as far as adding more than it’s subtracting.  (You might know the answer to that question, but I agree that “we” don’t know.)  I do believe that the system can be significantly improved without getting rid of it completely.  Again, it is possible that the world would be better off without a patent system, but I’d rather see it improved first.  (I think that our federal government needs a lot of improvement, too, but that doesn’t mean that no government is better.  I can’t help but look at Somalia as an example of a country with no centralized government.  But perhaps you’ve got a better example to point to.)  (For now, I’d better stick to patents per se and not use them as a metaphor for government in general.)  To me, the biggest problem with the current U.S. patent system is the granting of patents for inventions that are not novel and non-obvious due to the incompetence of the U.S. patent office.  Just last week I was advising a client that I didn’t think that their invention was patentable.  I had to qualify my advice by explaining that that did not mean that I didn’t think we could get a patent for the invention, just that I thought we shouldn’t be able to get a patent for the invention.  I can’t tell you, but I suspect you’ve experienced this yourself many times, how many patent applications I’ve prosecuted over the years where I get the U.S. patent issued only to have the European, Japanese, or Korean patent office subsequently find better prior art and apply that art with a more-accurate understanding and appreciation about what it takes for there to be a patentable improvement over that art.  The result is either an issued foreign patent with claims of much-reduced scope or an abandoned foreign patent application.  Either way, there remains an issued, presumptively valid U.S. patent of unknown value.  The presumption of validity is legitimate only if the U.S. patent office is doing a good job.  Since the U.S. patent office is not doing a good job, I agree with you that the presumption of validity should be eliminated.

For years I have been wondering what the EPO, JPO, and KIPO are doing right that the USPTO is not and why can’t the USPTO look and see what the EPO, JPO, and KIPO are doing to figure it out and then adopt it.  It reminds me of the time that Bush’s first crony appointment to head the PTO came to our PIPLA meeting and told us “We’ve got the best patent office in the world.”  In reality, we wouldn’t even get the bronze metal.  Our typical American chauvinism prevents us from looking elsewhere for improvement.

I am one of those many patent lawyers who would hate to have to provide search results and explain how my clients’ inventions were patentable over those search results.  Nevertheless, perhaps the default (an invention is assumed to be patentable until the patent office proves otherwise) needs to be reversed.

Until the PTO gets its act together, one way to challenge some of these bad patents is through the ex parte reexamination procedure.  It’s certainly not perfect and not free, but I’d bet it’s a lot cheaper than litigation as a way to defeat bad patents on a case by case basis.  I’m only now in the midst of working on my first ex parte reexam for a client who is trying to knock out a competitor’s bad patent.  The particular claim at issue is incredibly ridiculous.  The client managed to knock out claims (in a first reexam) directed to a particular type of device having [an Oscillator Type A], a particular configuration for oscillators that has been around for about 60 years.  The remaining claim is directed to devices that do exactly the same thing using [an Oscillator Type B], another particular configuration for oscillators that has been around for about 80 years!  Because the main reference didn’t happen to discuss [an Oscillator Type A], the Examiner allowed those claims, presumably without any knowledge or appreciation for the interchangeability of those different types of oscillators.  It’s too early to tell whether we will prevail.

Steve Mendelsohn
Mendelsohn, Drucker, & Associates, P.C.

[Mises; AM]

Comments:

Curt Howland January 25, 2010 at 7:16 am

“Until the PTO gets its act together…”

How come this is the one field of endeavor people expect government can (will, does, pick a tense) perform better than the market?

It seems to me that his argument is just like so many people who believe central planning will work, this time, if it is done correctly or by the “right” people.

Reply

Slim934 January 25, 2010 at 7:35 am

“(I think that our federal government needs a lot of improvement, too, but that doesn’t mean that no government is better. I can’t help but look at Somalia as an example of a country with no centralized government. But perhaps you’ve got a better example to point to.)”

Somalia as a whole (not just western Somalia which is in pretty bad shape relatively speaking) is doing much better now in a state of relative anarchy than it was under the last government that it had. There is actual capital accumulation occurring there now instead of organized plunder from its previous tyrannical regime.

Reply

bob January 25, 2010 at 4:17 pm

Somalia is far from the libertarian vision of anarchy, but it’s not a bad case either…at least compared to a couple decades earlier when there was a central government.

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Are anti-IP patent attorneys hypocrites?

Over the years I’ve been accused of being a hypocrite for practicing patent law while opposing its legitimacy, or similar charges–such as the charge that I must not or cannot be a very good patent attorney if I don’t believe in the system, or why do I “copyright” my own books if I don’t believe in copyright. Below is a collection of posts addressing these and related arguments.

Related links:

***

Following up on An Anti-Patent Patent Attorney? Oh my Gawd!, I was chatting with a friend about the following. I’ve argued that merely filing for patents is not inherently unlibertarian since patents, like guns, have both legitimate and illegitimate uses. The former being defensive use to ward off patent infringement suits or to countersue someone who sues you first. Still, there’s an … icky … feeling involved in getting a patent. The following may be a bit inside baseball for patent lawyers but I thought revealing some of the innards of how the process works may be of interest to some readers.

Laymen may not be aware of this but patent “prosecution” work (as filing the patent and interacting with the patent office to get it allowed, is called) is fairly fungible, low-dollar work, compared to other types of IP. To prepare and file a patent application, the patent attorney might charge anywhere from $7k to $15k or more. But patent litigation is much more lucrative (or can be), since the lawyers can get a cut of, or be paid based on the hopes of, multil-million or billion dollar judgments.

Patent lawyers also are often called on to prepare patent opinions. The good thing about these is they are more lucrative than patent prosecution–the attorney can often charge a good $25k or more to prepare one–and they can be completely libertarian. The typical usage is this. Company A is minding its own business and then becomes aware of a patent owned by company B that they are accused of, or otherwise concerned that they might be, infringing by selling a certain product that. Quite often the issue is not clear cut–the patent language is ambiguous and there are a variety of possible legal defenses one might have, that might or might not succeed at trial. If the risk seems high and the product is not important, the company may (a) design around the patent–that is, modify the product’s design so that it doesn’t infringe the patent; (b) stop making the product; (c) approach the patentee for a possible license. If the risk is low or the product is essential, sometimes there is option (d): keep making the product and pray that you are not sued. Option (c), designing around, sometimes employs an opinion of an attorney that the new design doesn’t infringe, or relies on input from patent attorneys as to how to increase the chance that the new design doesn’t infringe. [continue reading…]

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Da-da-da-da-da-da … CHARGE, says composer

From the St. Petersburg Times (h/t Wendy McElroy):

Da-da-da-da-da-da … CHARGE, says composer

By Kathleen McGrory, Miami Herald
In Print: Tuesday, April 19, 2011

Da-da-da-da-da-da! Charge!

If you attend sporting events, you are probably familiar with that ditty, a standard at ballparks, basketball arenas and hockey rinks across the country. They play it and play it and play it until your eardrums bleed.

What you might not know is that a Pompano Beach man says he composed it — and says he is entitled to compensation every time it airs publicly.

Bobby Kent, 62, holds a copyright for the song, a 26-measure piece he dubbed Stadium Doodads in the late 1970s. The last part of the song is the popular rally cry.

Kent is suing the company that once licensed the song to sporting venues, saying for the past two decades, he has been paid a fraction of what he deserves. Kent is also planning to sue every pro sports team in the United States — except the Los Angeles Lakers. He says he mailed a letter last year to every franchise, demanding money in exchange for using the song. The Lakers were the only ones who capitulated, paying him $3,000.

“I’m looking to get what I’m owed,” Kent said.

Read more>>

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The latest issue of Theoretical Inquiries in Law has several interesting pieces on the theme “Copyright Culture, Copyright History,” including:

Copyrights as Incentives: Did We Just Imagine That?

Diane Leenheer Zimmerman

Abstract

The most widely accepted explanation of why we need copyright is that it provides authors with the necessary economic incentive to create. This incentive story has largely gone unchallenged, and has been used to justify lengthening and strengthening the legal protections for expressive works. This Article points out, however, that the empirical foundation for the copyright-as-incentive story is seriously suspect. It fails to account for the economic conditions under which most art, literature and other expressive works are produced, and it contravenes the insights provided over the last forty years or so by psychologists interested in creativity and by behavioral economists. Empirical research has shown that intrinsic factors are much more important determinants of participation in creative work than such extrinsic ones as monetary reward. In fact, evidence exists that the promise of extrinsic rewards such as money can actually be detrimental to the creative impulse. This is not to say that concern with economic rewards should play no role in a legal regime designed to encourage the creative process. But, at a minimum, this Article suggests both that copyright scholars (and possibly patent ones as well) need to develop a far more nuanced understanding of why people produce what they do, and that a satisfactory legal regime to promote intellectual property creation and dissemination can afford to be far less concerned than it presently is with ensuring that authors and copyright owners can extract every bit of available profit from their works.

Recommended Citation

Zimmerman, Diane Leenheer (2011) “Copyrights as Incentives: Did We Just Imagine That?,” Theoretical Inquiries in Law: Vol. 12 : No. 1, Article 3.
Available at: http://www.bepress.com/til/default/vol12/iss1/art3

and

Bollywood/Hollywood

Madhavi Sunder

Abstract

Free flow of culture is not always fair flow of culture. A recent spate of copyright suits by Hollywood against Bollywood accuses the latter of ruthlessly copying movie themes and scenes from America. But claims of cultural appropriation go far back, and travel in multiple directions. The revered American director, Steven Spielberg, has been accused of copying the idea for E.T. the Extra-Terrestrial from legendary Indian filmmaker Satyajit Ray’s 1962 script, The Alien. Disney’s The Lion King bears striking similarities to Osamu Tezuka’s Japanese anime series, Kimba the White Lion. Neither Ray nor Tezuka’s studio sued the American filmmakers and this Article is by no means an attempt to revive any particular legal case. Rather, this Article considers copyright’s role in promoting free cultural exchange, albeit on fair terms in a global marketplace of ideas marked by sharp differentials in power, wealth, and knowledge.

Recommended Citation

Sunder, Madhavi (2011) “Bollywood/Hollywood,” Theoretical Inquiries in Law: Vol. 12 : No. 1, Article 10.
Available at: http://www.bepress.com/til/default/vol12/iss1/art10

The full contents of this issue is:

Copyright Culture, Copyright History

Introduction

Copyright and Truth

Maurizio Borghi

Copyrights as Incentives: Did We Just Imagine That?

Diane Leenheer Zimmerman

Copyright as Tort

Avihay Dorfman and Assaf Jacob

What Is a Copyright Work?

Brad Sherman

Copyright and Social Movements in Late Nineteenth-Century America

Steven Wilf

The “Extraordinary Multiplicity” of Intellectual Property Laws in the British Colonies in the Nineteenth Century

Lionel Bently

Hebrew Authors and English Copyright Law in Mandate Palestine

Michael D. Birnhack

Is Copyright Property? — The Debate in Jewish Law

Neil W. Netanel and David Nimmer

Bollywood/Hollywood

Madhavi Sunder

Tailoring Copyright to Social Production

Niva Elkin-Koren

Global Intellectual Property Governance (Under Construction)

Margaret Chon

An Old-Fashioned View of the Nature of Law

James Boyd White

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Cordato and Kirzner on Intellectual Property

From the Mises blog; archived comments below.

Update: See Classical Liberals, Libertarians, Anarchists and Others on Intellectual Property and this facebook postMay be an image of text that says '"Protection from entrepreneurial competition does not provide any spur to entrepreneurial discovery." Israel Kirzner FEE ory TE'


“Protection from entrepreneurial competition does not provide any spur to entrepreneurial discovery.” Kirzner, Discovery and the Capitalist Process (1985), p. 38

***

I’ve noted before the views of Austrians such as Mises, Hayek, and Rothbard on IP.1 They would be placed in phase 3 of The Four Historical Phases of IP Abolitionism.

In my post Mossoff: Why Should Business Leaders Care About Intellectual Property (Objectivism), I noted Sheldon Richman had relayed to me an interesting exchange between Roy Cordato and the pro-IP Adam Mossoff:

Mossoff recently appeared on an IP panel at the recent APEE annual meeting, along with several anti-IP libertarians, including Sheldon Richman (I believe Roderick Long was present too but I am not sure if he was on that panel). The panel also had Ed Lopez who offered efficiency arguments against IP but was not much part of the debate. Richman related to me that at one point, Roy Cordato asked Mossoff if IP would protect a Kirznerian entrepreneur who has a novel insight about the gap between the cost of inputs and the price of an output. At first Mossoff said he didn’t know what a Kirznerian entrepreneur was (Cordato explained), then he didn’t get the point (thinking Cordato meant the actual product rather than the idea about the gap between costs and price), then ended up saying that the idea would be patentable–which means the law would stop market equilibration, since others could not jump in and imitate the entrepreneur.

This got me curious about Cordato. Sure enough, in his 1992 book Welfare Economics and Externalities in an Open Ended Universe, he has several passages indicating a skepticism of IP. On pp. 21-22, he discusses the difference between Mises and Rothbard on patent and copyright; see also p. 36 (“If an external benefit “problem” arises that is the result of ambiguously defined entitlements, then some form of public policy which focuses on establishing those rights may be advocated. The sole example of this in the literature is Mises’ discussion patent and copyright laws”). On p. 80:

Mises has suggested, though, that an external benefit “problem” might arise where intellectual property rights are not clearly defined; this is the issue of patents and copyrights (see chapter 1). Mises clearly focuses on an issue of property rights that may have normative implications for catallactic efficiency. Ambiguities with respect to entitlements in the area of inventions and the generation of ideas can lead to interpersonal conflicts in the plan-formulation and goal-seeking process. As noted, to efficiently make plans, individuals need to know that their rights to use the relevant property will be upheld at pertinent points in the future. The issue of patents and copyrights may be an application of this principle.

On the other hand, this is clearly an area where the limitations of economic analysis are exposed and a theory of justice may need to be invoked. Consistent with O’Driscoll and Rizzo’s point, this is a case where certain ethical questions need to be resolved before economic analysis can be applied. The question of whether property rights can legitimately be applied to ideas, particularly given that ideas and inventions can be and often are independently discovered, has both practical and ethical implications. In such cases, the granting of property rights to a discovery itself denies the rights of others who have made or will make the same discovery independently (Rothbard 1970, p. 71). This denial of rights would clearly interfere with plans that were made by the independent discoverer and may consequently have a negative impact on the accuracy of some market prices. This suggests that the granting of property rights to ideas would likely lead to its own problems with respect to catallactic efficiency.6 Mises’s brief analysis, providing neither a theory of justice nor efficiency, does not give us a satisfactory approach to this issue. [continue reading…]

  1. On Hayek: see Tucker, “Misesian vs. Marxian vs. IP Views of Innovation“; Tucker, “Hayek on Patents and Copyrights” (archived comments). On Mises, see 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“. Rothbard: Knowledge, True and False and Man, Economy, and State and Power and Market, Scholars Edition, pp. liv, 745-54, 1133-38, 1181-86. []
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I noted in Supreme Court Prepares to Chop Down “Clear and Convincing” Standard for Proving Patent Invalidity that the Supreme Court had agreed to hear the appeal of the Microsoft Corp. v. i4i Ltd., case. In this case, i4i sued Microsoft for patent infringement and was awarded a $290M judgment, based on Microsoft’s use of XML in Word.

At issue here is the burden of proof Microsoft needs to satisfy to prove i4i’s patents invalid. As I previously explained, my hope is that Microsoft wins–they have argued to lower the standard of proof needed to invalidate a patent. This would be a minor change, but in the right direction. The Court heard oral arguments in this case earlier this week; they are summarized here. It’s hard to be sure what the Court will do but my impression is they will probably side, at least partially, with Microsoft.

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Apple sues Samsung over Galaxy products

From Reuters: Apple sues Samsung over Galaxy products: for “copying” the iOS devices.

Disgusting and horrible. This is the use of the state to stop competition.

Update:  Samsung strikes back at Apple with ten patent infringement claims

–a good example of why companies are forced to acquire an arsenal of patents for defensive purposes.

See also Apple: Patent Crybaby

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