Summary Advanced Intellectual Property Law – NOT FOR DISTRIBUTION
Advanced Topics in Intellectual Property Law
Objectives:
Through in-depth study of recent developments, the students will learn how: to explain the role and regulation
of institutions, innovation and competition in intellectual property law;
- To give examples of the interaction between new technologies and intellectual property rights
- To interpret and assess such developments from the societal perspective; o to break-down the costs
and benefits of various innovation policy strategies and discuss basic trade-offs inherent in regulating
innovation through intellectual property rights;
- To develop own position regarding proposals of others and to formulate own original legal or non-
legal solutions to presented problems;
This course is an advanced course in intellectual property and technology. The course will analyze a variety of
situations where technology is shaping, challenging or strengthening the goals of intellectual property law. It
will cover a carefully selected number of case studies relating to three basic pillars: innovation, competition
and enforcement. It will cover practical issues such as enforcement of copyright in the digital age, open source
licensing, technological standardization, data portability and ownership, human rights and liability of Internet
platforms.
Goal: in-depth understanding of selected high-profile IP issues
Possible cases Final exam
- Case C-372/19 – Sabam
- L’Oreal/eBay 2009
o CJEU had already decided that Article 11 Enforcement Directive not only allows an injunction
ordering an intermediary to bring an end to an infringement, but also to order it to bring an
end to further infringements of the same kind. So, an injunction may not be able to specify
exactly what is expected from the IAP, since future infringements are as a matter of course
somewhat harder to specify. However, in the l’Oreal/eBay case, the court placed a limit on
what can be imposed on an IAP: the ‘injunctions must be effective, proportionate
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,Summary Advanced Intellectual Property Law – NOT FOR DISTRIBUTION
Lecture 1 - Why Intellectual Property? Innovation, Competition & Exclusive rights
- Chapter XIII, William Glyde Wilkins, Charles Dickens in America (University Press of the Pacific, 1911)
available at www.laws.husovec.eu (folder> Teaching materials)
- Victor Hugo, Speech to the Congress of Literary, Industrial and Artistic Property Paris, 1878 – see
Boyle & Jenkins, 282-283 (2 pages)
- Petra Moser, Intellectual property rights and artistic creativity
https://voxeu.org/article/copyrightand-creativity-lessons-italian-opera (5 pages)
- Martin Kretschmer and Philip Hardwick, Authors’ earnings from copyright and non-copyright
sources: A survey of 25,000 British and German writers
https://microsites.bournemouth.ac.uk/cippm/files/2007/07/ACLS-Full-report.pdf (only p. 3-6)
- James Boyle, The Public Domain: Enclosing the Commons of the Mind, available at
http://thepublicdomain.org/thepublicdomain1.pdf, pp. 1-41
- The Economy: Innovation, Information and the Networked Economy, available at
https://coreecon.org/the-economy/book/text/21.html#215-matching-two-sided-markets
- Justine Pila, Paul Torremans, European Intellectual Property Law (OUP 2016), pp. 74-98
Today:
- What are the goals of IP rights?
- How are they related to innovation, competition and monopolies?
What are IPRs?
- Why do we have them?
- Protect someone for its investment, incentivize access, incentivize innovation (patents = new
innovative invention, reward someone for using the tech), Recognition, Society has problems this
encourages solutions to the problems, fair competition, Avoiding unnecessary investments of others
- Trademarks compared to CR/Patents: Trademarks more about recognition
Summarize some of these points:
- Typical: origin à Justice argument (reading: Charles Dickens) – arguing he should have recognition of
his works in the US (since US could discriminate based on nationality)
o Dishonest: someone put in labor, so would be unfair not to recognize
- Patent (similar) linked to recognizing creative efforts, classic story: didn’t have money to apply for
patent, he has 2 options = disclosing and getting nothing or destroying it
o Choice were 2 bad options à selling it in the end and did not get a lot of money
Why do we have IPRs?
à Justice argument
- “The denial of protection to the rights of authors is not even impolitic and unjust, but a positive and
flagrant robbery” (New York Tribune, February 21, probably written by Horace Greeley – after Dickens'
US stay)
- “Principle of common honesty” (Dickens)
- “A man has a very insecure tenure of a property which another can carry away with his eyes. A few
months reduced me to the cruel necessity either of destroying my machine, or of giving it to the public.
To destroy it, I could not think of; to give up that for which I had labored so long, was cruel. I had no
patent, nor the means of purchasing one. In preference to destroying, I gave it to the public.” (Samuel
Crompton, inventor of Spinning Mule)
à Freedom argument
“All the old monarchical laws denied and still deny literary property. For what purpose? For the purpose of
control. The writer-owner is a free writer. To take his property, is to take away his independence. One wishes
that it were not so.” (Victor Hugo to the Congress of Literary, Industrial and Artistic Property, Paris, 1878)
- Victor Hugo: different slightly from the justice argument
- What does he try to say? The fact that we don’t get authorship, benefits someone since we have no
control à Monarchs, Churches and Nobility
- Golden age happened without CR law, since church didn’t want to spend money on Art
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,Summary Advanced Intellectual Property Law – NOT FOR DISTRIBUTION
- If these monarchs etc. were paying for art, the one who creates does not have control, means power
lies with the monarchs à prevents you from going out there and commercializing it
- No control means taking away to exchange that control for money à Idea that not giving them
control is depriving them from gaining money on the market
- CR allows freedom of expression à since allows people to make money of it
What are IPRs?
Economic argument 1: Creation
Takes time/money to make such creations à they will have to commercialize and face the others if you don’t
give the IPRs – if they don’t get the sufficient rewards, they won’t do it again or make the investment
- Dickens’ would not create if he had no copyright in England
o But many authors have very strong intrinsic motivations, e.g. Michael Punke (“Revenant”);
job= WTO trade negotiator;
o The idea is: exclusive rights is that it can be the main activity for people
- Especially valid for inventions > Rational self-interested businesses will invest in inventions, only if they
can monetize them;
- E.G: developing a new material “super-plastic” costs 1 million EUR (FC);
o In order to make it profitable, the inventor has to have a view of earning at least that 1
million EUR;
o Only thing that protects me without IPRs is lead-time, they have to reverse engineer etc.
§ De facto exclusivity
§ If it is too short: I wont be able to rake in the money
o This is the typical story, a self-interested economic unit will calculate whether the investment
is possible
- Authors à personal time (difference with creators is: very often intrinsic motivation stronger)
o Books are different, since investment might be different (not as big)
Economic argument 2: Diffusion
- Without IP rights, firms would not invest money in diffusing innovation, e.g. would not create costly
movies based on comics or to re-use drugs based on active new breakthroughs
o We need people to put something on the market/produce it à if no one picked it up no one
benefits
o The other argument: something incentive to commercialize – Diffuse
§ E.g.: Viagra – side effect when testing for heart disease
§ Spiderman movies: if Spiderman was public domain, no one would make it anymore,
who would make it when everyone could do it
• People who own the CR don’t know about it, or don’t know if they can
make money from it
• No one can make it without their permission, so there is some kind of black
hole
§ If everyone makes Spiderman movies, not interesting to make it anymore. E.g.
Marvel gives licenses, so many movies, since licensees have to make movie every 2-3
years, imagine non-exclusive – many licensees, still interesting to invests in
Spiderman movies?
Why do we care about innovation?
People benefit from solutions or growth – GDP goes up, how do I benefit? – Quality of life?
- We care since we somehow benefit
o Example: Pie = benefit
o Assuming it creates benefits, goal should be investor benefits and takes a part of the pie
o However, because expiration/etc. also competitors benefits
o Yet, the competitors should never appropriate all the benefits – the whole pie
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, Summary Advanced Intellectual Property Law – NOT FOR DISTRIBUTION
- Who appropriates the value?
- Society – inventor – competitors
Power of innovation
- Think of your smart-phone!
- 1 smartphone (2015) = 11.8 million km2 of ENIACs (1943) [Eur.=10.2]
o If you would like to replicate the power by smartphone (12 million KM2 of these computers)
– in 62 years this is the jump in computing power
o Benefits of smartphones – pie example:
§ Communication
§ Navigation
§ Mobility
§ Accessibility of information
§ Comfort
§ Entertainment
o Q: for policymakers to ask themselves – What shape do we need for IPR to bring about
innovation? Societal debate: when people question IPRs, it is about what is the way to get
there? Is this format of IPRs the best way?
- Is being used as cheap satellites by NASA (average smart-phone has more computing power than an
average satellite)
- Innovation improves our lives in the long run.
- But are IP rights needed to bring about innovation?
How to get innovation?
2 basic views:
- Monopoly (associated with Schumpeter: econ professor)
§ You need monopoly to incentive creation
o Associated with thinking close to IP rights: exclusivity that gives them a good position, to get
their investment and innovate
o Monopoly reward motivates people
o However: if people have rewards, they get lazy
- Competition (arrow)
o So then competing with each others, is what motivates people
à what is the optimal outcome of the 2
Why IPRs
- Is monopoly needed to induce innovation?
o Yes (Schumpeter)
o No, competitive pressure is sufficient (Arrow)
- Both extreme views: all can think of situations in which monopolies can be either good or bad
- Today prevailing view:
o Yes + No: relationship between innovation & competition is inverted “U” shape (Aghion)
o And it depends on a type of innovation
§ Optimal to give people some incentives through monopoly, but not top much, so
they remain in check by the competitors
- Point is: U shape
o If competition is weak = incentive is low
o 4 competitors = More incentive to innovate
o 10 competitors = Not too much innovating, since a lot of discussion
- What is the optimal mix: this is what CR try to do?
Why IPRs?
- Exclusive rights ≠ Monopoly
o Excl. rights do not always lead to monopoly
o Legal monopoly is not always an economic monopoly
- Exclusive rights might lead to a monopoly
o Patents more likely than copyright to lead to monopoly: example:
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