The Competitiveness of Nations
in a Global Knowledge-Based Economy
|
|
Page 138 141 143 143 143 144 146 148 150 151 152 152 154 155 163 163 164 |
Epithet ... intellectual property is, after all, the only absolute possession in the world... The man who brings out of nothingness some child of his thought has rights therein which cannot belong to any other sort of property Zechariah Chaffe “Reflections on the Law of Copyright” Columbia Law Review, 1945
HHC © last revised December 2004 Draft in Progress |
8.01 Having reified abstract knowledge qubits (WIT, PSI, IMP and PED) as inputs (personal & tacit labour, codified & tooled capital and toolable natural resources) to and outputs (the Person, Code & Work) of a knowledge-based economy, the question arises: How does knowledge become legal property that can be bought and sold in markets? Property means ownership - communal, private or public – together with its associated rights of access, or, in this case, ‘rights to know’.
8.02 In pre-literate societies, knowledge was transmitted orally through the mnemonics of ritual and chant reinforced by religious practice and taboo. Some knowledge was shared by all; some was shared in secret only with initiates (Eliade 1954). The association of rhythmic or repetitively patterned utterances with supernatural knowledge endures well into historical times. For example, among the early Arabic peoples, the word for poet was sha’ir, “the knower”, a person endowed with knowledge by the spirits (Jaynes 1978). Innovation, i.e., application of new knowledge, depends upon the initial insight of a creator plus his or her ability to maintain its mnemonic integrity through time, e.g., as incantation or epic poem. Cause and effect are indistinguishable. It is through unchanging re-enactment of ritual that desired results are achieved. Science and art are one. How to make something and the thing made are mystically married. Process and product are identical. To name a thing is to magically control a thing.
8.03 In such societies, awe and mystery surround the created object into which the creator projects his or her spirit and soul. In Japan (a First World country retaining many ancient animistic sensibilities), a sword, being a product of mental work, is regarded not merely as a material object, but as being imbued with the author's living spirit. The result can arguably be seen in contemporary Japanese industrial craftsmanship. Furthermore, objects of worship are not limited to visible and concrete
138
things. Even a word can have a spirit. (Koisumi 1977, 12). One cannot buy or sell such knowledge; only the material shell containing it. Knowledge, in effect, is the soul-stuff of a creator.
8.04 In the ancient Western and contemporary Islamic world, at least until recently (Habib 1998) [A], knowledge was kept secret or, when made public, its paternity was protected by moral rather than legal rights (Chartrand April 2000). Ownership, in an economic sense, did not exist per se. Punishment for falsely claiming paternity, or what today we would be call copyright or patent infringement, took the form of defamation of the infringer and casting shame on his or her family and tribe.
8.05 After the fall of Rome, knowledge in the West became the preserve of the Christian Church. In secluded, distantly separated monasteries surviving written works of the Ancient World were lovingly copied and preserved. They provided the epistemological gold standard for secular knowledge in the so-called ‘Dark Ages’ while the Bible shed all the light thought necessary on God’s purpose. Those who dared draw knowledge from the well of ancient nature lore were branded witches and warlocks and those who experimented with nature were branded alchemists and magicians. Both were subjected to the same penalty: Burn the body, save the Soul! Old ‘approved’ knowledge was revered; new knowledge was generally suppressed making ownership literally a metaphysical question.
8.06 With the arrival of the ‘Renaissance Man’ in the 15th century, the artist/engineer/humanist/scientist, there began a distinct Western European ‘Cult of the Genius’ (Zilsel 1918; Kristeller 1954, 510; Woodmansee 1984). Genius, no matter its social origin, demonstrates god-like powers creating ex nihilo, i.e., out of nothing (Nahm 1947). Such new knowledge changes the way people see, hear and understand the world and themselves. Fed by Christian belief in the equality of souls and theological rejection of slavery, this marked the first eruption of the individual Person out of feudal subordination by birth. Ownership of ‘new’ knowledge, as will be demonstrated, began to evolve into marketable and legally enforceable intellectual property rights. Ownership became not just a question of metaphysics and morality but also of money and wealth.
8.07 In the 17th century the experimental philosopher and in the 18th, the author joined this pantheon of Western genius (Woodmansee 1984). Increasing amounts of new knowledge, in all domains, initiated the “Querelle des Anciens et des Modernes”, i.e., the battle of the Ancients and the Moderns marking the beginning of the 18th century European Enlightenment (Kristeller 1952, 19). Who are superior, the Ancients or the Moderns? The answer: the Moderns.
8.08 By the end of the 18th century Republican Revolutions shattered feudal subordination declaring all men equal. In the 19th, the inventive genius of Watt was followed by Bell, Edison, Marconi, Morris and others who transformed the life ways of humanity. And, about the same time as the first telephone call in 1876, the troubled and tortured artist starving in his garret became the spear point of an avant garde transforming the way
139
humanity sees and hears its inner and outer worlds (Bell 1976). Finally, in the 20th century, natural & engineering scientists donned the cape of genius as the atomic bomb and nuclear energy, followed by computers, genomics and space travel, caught the popular imagination with a fuzzy haired Einstein as its poster boy.
8.09 Out of this traditional Cult of the Genius emerged what I call the Myth of the Creator (Chartrand Fall 2000) eloquently expressed by Zechariah Chafee in the epithet to this chapter.
… intellectual property is, after all, the only absolute possession in the world... The man who brings out of nothingness some child of his thought has rights therein which cannot belong to any other sort of property. (Chaffee 1945)
Creation of new knowledge in all domains - the natural & engineering sciences, the humanities & social sciences and the Arts – became a public good to be fostered and encouraged so that all humanity might benefit from the creativity of genius. The question is, of course, how should genius be fostered and encouraged?
8.10 Like most myths this one contains some elements of truth. Thus, under the European Civil Code tradition, the myth is reflected in the ‘moral rights’ of creators that are “inalienable, unattachable, impresciptible and unrenounceable” (Article 11, Decision 351, Andean Community, 1993). Such rights echo back to ancient animism and are deemed self-evident under the principles of ‘natural law’ (Taylor 1929, 1930), the supposed root of the Civil Code.
8.11 Unlike the Civil Code, however, the Anglo-American Common Law, and its associated intellectual property rights (henceforth, IPRs), is rooted in precedent rather than principle. The result is that:
the complex body of law, judicial interpretation, and administrative practice that one has to grapple with in the area of intellectual property rights has not been created by any rational, consistent, social welfare-maximizing public agency.” (David 1992)
8.12 The resulting patchwork complexity is arguably one reason why there has been limited empirical economic analysis of IPRs (Besen & Raskind 1991, 4). [B] In economic theory, however, IPRs are justified by ‘market failure’, i.e., when market price does not reflect all benefits being captured by the consumer and all production costs being paid by the producer, e.g., when market price does not include pollution costs associated with production or consumption. These are generally known as external costs and benefits, i.e., external to market price. IPRs, in this view, are created by the State as a protection of, and incentive to, the production of new knowledge which otherwise could be used freely by others (the so-called free-rider problem). In return, the State expects creators to make new knowledge available and that a market will be created in which such knowledge can be bought and sold. But while the State wishes to encourage creativity, it does not want to foster harmful market power. Accordingly, it builds in limitations to the rights granted to creators. Such limitations embrace both time and space. They are granted, assuming full disclosure of the new knowledge:
140
· only for a fixed period of time, i.e., either a specified number of years and/or for the life of the creator plus a fixed number of years; and,
· only for the fixation of such new knowledge in material form, i.e., it is not ideas but rather their fixed expression in material form (a matrix) that receives protection.
8.13 Eventually, however, all intellectual property (all knowledge) enters the public domain where it may be used by anyone without charge or limitation. Even while IPRs are in force, however, there are exceptions such as ‘fair use’ or ‘fair dealing’ under copyright. Similarly, national statutes and international conventions permit certain types of research using patented products and processes. And, of course, governments retain authority to waive all IPRs in “situations of national emergency or other circumstances of extreme urgency” (WTO/TRIPS 1994, Article 31b), e.g., following the anthrax terrorist attacks in 2001 the U.S. government threatened to revoke Bayer's pharmaceutical patent on the drug Cipro (BBC News October 24, 2001).
8.14 Without prejudice to such exceptions, the foundation stone of contemporary IPRs is that an idea, a.k.a. knowledge, is not protected but rather its expression fixed in material form or matrix. I will first examine the nature of the matrix and its relationship to IPRs. I will then consider the major categories of IPRs – copyrights & trademarks, patents & industrial designs, know-how & trade secrets. This will be followed by an examination of the public domain where the vast bulk of human knowledge resides. In effect, IPRs define our legal, and therefore our economic ‘rights to know’.
8.15 Intellectual property rights do not protect ideas but rather their expression fixed in a tangible material form called a ‘matrix’. A matrix is a “supporting or enclosing structure” (OED matrix, n I). A tangible material form is something that, traditionally, can be seen, touched or otherwise perceived by a human being and, furthermore, has some permanence. Finally, any expression fixed in a matrix must be original to receive protection by the State. Four questions arise. Why are ideas not protected? What constitutes a matrix? What does perception of a matrix mean? And, finally, what is the function of a matrix relative to knowledge embedded therein.
8.16 Justice Yates, in his dissenting opinion in the 1769 case of Millar v. Taylor, laid out the legal argument why ideas are not protected. He argued, drawing on the Institutes of Justinian (one of the sources of the Civil Code), that ideas are not the object of property rights because they are like wild animals or ferae naturae that once set free belong to no one and everyone at the same time, i.e., they are in the public domain. It is only their specific expression fixed in material form – commonly known as a work – that qualifies for protection (Sedgwick 1879). [C]
8.17 What constitutes a matrix is problematic. Examples drawn from the recent history of copyright in Canada and patents in the United States
141
will demonstrate. Under Canadian copyright until 1988, recorded extemporaneous music, i.e., music improvised and simultaneously recorded, did not qualify for protection because it was not “reduced to writing or otherwise graphically produced or reproduced” (Keyes & Brunet 1977, 40). The recording itself did not qualify as a matrix. Similarly, until 1988, computer programs did not qualify because they were not perceivable by a human being (Keyes & Brunet 1977, 40). Today, of course, the Microsoft business empire, among others, is rooted in software copyright.
8.18 U.S. patent examples also demonstrate the role of case law in developing IPRs in the Anglo-American tradition. Unlike Civil Code principles which tend to be stable, case law is determined by judges whose reasoning influences subsequent interpretations of the law by precedent. In the case of genetic patents, the U.S. Patent Office denied patents to living material including genes until 1980. At that time the Supreme Court in Diamond v Chakrabarty reinterpreted existing law, i.e., there was no change in the law itself. The case involved a patent for a genetically engineered microorganism that breaks down crude oil. The Court observed that Congress had the power to limit such patents but by failing to legislate specifically about genetic patents it had, in effect, allowed gene patenting. The Court’s rationale was based on the term ‘manufacture’ in Section 101 of the U.S. Patent Act: “the production of articles for use from raw materials prepared by giving to these materials new forms, qualities, properties, or combinations whether by hand labor or by machinery.” Genes, the Court concluded, were material, i.e., they had tangible material form, even though invisible to the naked eye.
8.19 With respect to software patents, the Patent Office resisted patentability because computer programs were considered mathematical algorithms, not processes or machines. In its 1981 decision in Diamond v. Diehr, the Supreme Court ordered the Office to grant a patent even though computer software was involved. The Court found the program was not just a mathematical algorithm but rather a process, specifically for molding rubber. The Patent Office continued to be troubled in distinguishing a computer program from an algorithm. In the 1990s the Federal Circuit Court tried to clarify the question by requiring that an invention be examined as a whole and finding that an invention using a computer to manipulate numbers representing concrete or real world phenomenon is a process relating to tangible material forms and is patentable. In 1996 the Patent Office adopted its Final Computer Related Examination Guidelines making a computer-related invention patentable if the program is used in connection with a specific machine or product (Tysver 1998).
8.20 As demonstrated, a matrix originally needed to be perceptible by a human being, particularly by sight. The law, being inherently conservative, traditionally concluded that if the matrix was not perceptible then it was not possible to assess other requirements for protection, e.g., originality, non-obviousness, usefulness, etc. For example, ephemeral displays on computer screens prior to 1988 received no protection in Canada. An electron might be a part of the physical
142
world but if a lawyer could not see, touch or otherwise perceive it then it had no legal standing as a matrix (Keyes & Brunet 1977, 129).
8.21 In effect, over time, the use of instrumentation extending the human senses has been accepted by the Courts. The implication is that there is no longer any microscopic (or macroscopic) legal limit to intellectual property being fixed in material form, only a technical one.
8.22 Essentially a matrix can have one of three functions – utilitarian, non-utilitarian and personal. These can be used to classify intellectual property rights into generic categories that, with qualification, correspond to the Work, Code and the Person.
8.23 The matrix of industrial designs and patents is utilitarian, i.e., it is useful for some purpose other than itself. Thus an industrial design impresses aesthetic value onto a matrix that is useful in its own right – a decorated coffee cup remains a coffee cup stripped of its decoration. A patent, on the other hand, impresses utilitarian function or ‘usefulness’ into matter itself – an electromagnetic door jam is a new type of door jam.
8.24 Code is subject to copyright and trademarks where the matrix is non-utilitarian. Thus a copyright protects expression fixed in a matrix that has no inherent utilitarian value, e.g., a book makes a second rate door jam. Similarly, trademarks (and marks of origin) symbolize the ‘identity’ of a company, business, district or government. Like copyright the matrix in which a trademark is fixed has no intrinsic value. Unlike copyright, however, a trademark in effect impresses the ‘good will’ earned by a business or government on a matrix rather than the expression of an idea as such.
8.25 The Person is the subject of ‘know-how’ and trade secrets where the matrix is a legal or natural person. Know-how is essentially experiential in nature. Only a human being can have experience and hence know-how is fixed in a natural person. Such knowledge can, however, be transferred from one person to another by demonstration and practice but it cannot usually be formally articulated or codified, i.e., it is personal & tacit knowledge
8.26 In the case of trade secrets, knowledge may be fixed in either a natural or a legal person. A trade secret, using the metaphor of Justice Yates above, is a caged animal. The cage is the contractual confidentiality provisions used by legal persons to bind employees and other agents to secrecy. It should be noted that not every country has formalized know-how and trade secrets as intellectual property rights through statute. However, some recent international conventions do formally recognize and protect trade secrets and know-how, e.g., the Common Industrial Property Regime of the Andean Community and the
143
WTO Agreement on Trade-Related Intellectual Property and Services (TRIPS) (Chartrand 2001).
8.27 The overtly commercial nature of industrial designs, patents and trademarks also place them in a distinct legal category called ‘industrial property’, subject of the first international intellectual property rights convention, the Paris Convention for the Protection of Industrial Property of 1883 (Chartrand 2001). The non-utilitarian nature of copyright, by contrast, is recognized in a separate set of international conventions beginning with the Berne Convention for the Protection of Literary and Artistic Works of 1886 (Chartrand 1998). The difference was summed up by Keyes and Brunet:
Though copyright is expressed in terms of property, it is not directly analogous to industrial property (patents, trademarks and industrial designs), where the major concern is with the circulation of goods that have economic value apart from their intellectual content. As it deals with purely intellectual matter, copyright can never interfere with a person’s physical well-being. (Keyes & Brunet 1977, 3)
8.28 While the matrix can be used to order intellectual property rights into generic categories – utilitarian, non-utilitarian and personal - the nature, scope and composition of each IPR is different. Each provides the legal foundation for a distinctive industrial organization based on the commercial exploitation of new knowledge. Furthermore, each consists of a distinct and differing bundle of rights defining what forms of knowledge can be bought and sold, where it may be marketed, under what terms and conditions, and how long such rights are enforceable before new knowledge enters the public domain.
8.29 The law, however, is a cultural artifact, i.e., it varies in principle and practice between countries and cultures. IPRs therefore vary significantly between and even within neighborhoods of the global village (Chartrand 1995). Thus among First World countries two distinct traditions exist – Anglo-American Common Law and European Civil Code. Yet even within these traditions there are significant variations, e.g., between American, British and Canadian IPRs. Furthermore, unlike other internationally traded goods and services subject to harmonization under the World Trade Organization (WTO), IPRs are subject to the milder constraint of ‘national treatment’. This means a Nation-State must extend to foreigners the same rights it grants its own citizens but such rights need not be, and generally are not, the same nation to nation.
8.30 This degree of freedom is a lever increasingly being used to enhance the competitiveness of nations. Nation-states are actively engaged in reform and revision of their IPR regimes. Each strives, formally and informally, to develop an optimal legal framework for the generation of new knowledge and its subsequent commercial exploitation - subject to the constraints of its history, custom and tradition. This evolving legal structure is, in turn, part of a broader national innovation system (OECD 1997).
144
8.31 In what follows I will summarize the Anglo-American histories of the six primary IPRs. These are presented in groups of two based on a common matrix – designs & patents, copyrights & trademarks, and know-how & trade secrets. Only passing reference is made to Civil Code practice. An additional class of IPRs is also discussed, sui generis or one-of-a-kind rights.
8.32 There are, however, three general characteristics of the Anglo-American tradition that colours these histories. The first concerns the origins of the Common Law of business. The second involves the relationship of natural and legal persons. The third involves the evolving definition of property, i.e., what can be bought and sold.
8.33 First, after the Statute of Monopolies of 1624 development of the Common Law was a process whereby the courts converted the customary bargains and business practices of guilds and corporations into a common law of property and liberty (Commons 1924: 229). However, while “the monopoly, the closed shop, and the private jurisdiction were gone … the economics and ethics remained” (Commons 1924: 230).
8.34 Second, a natural person is a living human being; a legal person is a body corporate. The vast bulk of productive assets are owned by fictitious legal persons such as corporations, companies, sociétés, Gesellschaften. Such persons are birthed under incorporation statutes that allow them to engage in a wide variety of profit making and charitable activities. In the futuristic world of William Gibson, computer-based artificial intelligence qualifies for Swiss citizenship (Gibson 1984). In the Anglo-American tradition legal and natural persons enjoy the same rights; under the Civil Code, however, they enjoy different rights. It is with respect to knowledge in Anglo-American and Civil Code traditions that this difference is most apparent. Thus Civil Code moral rights of creators are justified because their work bears the “imprint of personality” that a body corporate simply does not possess (Geller 1994). This imprint of personality has fueled ongoing controversy between the United States and the European Union, especially France, over extending to American media corporations doing business in Europe, rights restricted under Civil Code to natural persons.
8.35 Third, there is an important historical connexion between the evolution of intellectual property rights and the definition of property itself. This involves movement away from defining property as ‘things’ – moveable or immovable – towards property as the intangible expectation of profit.
8.36 Two years before publication of the Wealth of Nations perhaps the most momentous legal decision in the history of knowledge and towards modern definition of property was reached in 1774 by the Law Lords of England in the case of Donaldson v. Beckett. The question was: Does an author have a natural and perpetual copyright? The answer was no (Chartrand 2000). Beyond its implications for copyright, this decision arguably contributed to the modern definition of property in what J.R. Common’s calls:
145
The transition from concepts of physical things to concepts of business assets, [that] could not be fully completed until the idea of ownership was shifted from the holding of physical things to the expectations of profit from the transactions of business. (Commons 1924, 275)
This shift from tangible to intangible property gave birth to many new legal and economically valuable business rights especially ‘good will’. This trend may be approaching an apogee with emergence of the knowledge-based economy.
8.37 Copyrights and trademarks use a non-utilitarian matrix to encode knowledge in a material form that may be called a ‘communications media’. This media takes many forms including paper hardcopy and electronic softcopy. It all cases, however, it is intended to be read or decoded by a natural person thereby becoming personal & tacit to the reader.
(a) Copyrights
8.38 Copyrights are rights traditionally granted to creators of artistic and literary works. These rights have, however, been extended over time to include:
· artistic works such as choreography; drawings, motion pictures, musical compositions, paintings, photographs, sculptures and works of architecture;
· literary works such as novels, poems, plays and reference works, and,
· commercial or utilitarian works such as advertisements, computer programs, databases, maps and newspapers.
8.39 Copyright is granted to natural and legal persons. When granted to a natural person it endures for the life of the artist/creator plus a fixed number of years that varies between countries, e.g., in Canada for fifty and in the United States for seventy-five years. Copyrights granted to legal persons are also for a fixed number of years that also varies between countries. In the Civil Code tradition, however, natural persons receive certain imprescriptable rights not available or transferable to legal persons, e.g., droit de suite or rights of following sales for works in the visual arts as well as moral rights of artists. Some Civil Code rights have been adopted by Anglo-American countries, e.g., Canada, but they remain transferable to legal persons by contract, extinguishing rights of the original creator. Copyright cannot be renewed.
8.40 As noted above, over time copyright protection has been extended from books to maps and charts, sheet music, photographs, sound recordings and motion pictures. Until the 1980s, however, copyright was, in all Anglo-American countries, restricted to ‘works of art’. With introduction of software copyright, however, utilitarian works received copyright protection for the first time, and probably not the last. Copyright can emerge from any of the three knowledge domains – NES, HSS or the Arts – and can be obtained by natural and legal persons.
146
8.41 Two additional observations are in order. First, the first patent provision in the United States was a footnote to the copyright provisions of the 1784 South Carolina “Act for the Encouragement of Arts and Sciences.” What makes this provision important is that it so closely coupled patent with copyright protection, assigning the former as most appropriate to “machines”, and the latter to “books”, with little difference in their treatment. The Constitutional Convention of 1787 was influenced by this Act and spoke also of securing exclusive rights for “Authors and Inventors” to “promote the Progress of Science and useful Arts”. Neither copyright nor patents for invention were, however, explicitly mentioned (David 1992).
8.42 Second, there is the question of works by employees. Under Anglo-American copyright all works created by an employee are, unless by contract stated otherwise, the property of the employer. The employee cannot even claim paternity to his or her work. This is not the case under the Civil Code where paternity of the employee is preserved.
8.43 In the constitutional monarchies of the British Commonwealth, the State also exercises ‘Crown copyright’ over works created by servants of Her Majesty. In the United States, there is no equivalent of Crown copyright but rather a tradition that tax payers having paid for such work they fall into the public domain. In the case of patents, any invention created during company time by an employee is, by contract, automatically licensed to the employer but the patent application must be done in the name of the employee responsible, i.e., paternity is maintained. This is the case in both Common Law and Civil Code countries.
8.44 There is, however, one prominent Anglo-American exception to employer copyright: the university. Following the tradition of academic freedom, copyright to works by professors is, by contract, theirs and theirs alone. This exception has, arguably, resulted in the separation of the financial and career interests of scholars from that of their host institutions. Multinational communications conglomerates have, in effect, filled the gap between the two. Four or five such global firms now control copyright on the world’s most prestigious scientific journals written by academics employed by universities and colleges. In turn, their employers must now pay escalating library subscription fees for works authored by their own employees. This has resulted in a shrinking supply of periodical publications for students in all knowledge domains (The Economist, August 5, 2004). In response to these educational and financial costs, the Association of Research Libraries, among others, are developing web-based alternatives to ‘commercial’ academic publishing.
(b) Trademarks
8.45 Trademarks (and marks of origin) are devices such as a word, logo or other mark pointing to the origin or ownership of a good or service that is reserved for the exclusive use of its owner as maker or seller. Today, its application has, de facto, been extended to ‘domain names’ on the internet or world-wide web. The World Intellectual Property Organization (WIPO) has thus established dispute settlement mechanisms to resolve ‘cyber squatting’, i.e. registering a domain name
147
using the name or trademark of an established business enterprise or celebrity, e.g. Julie Roberts, with the intention of selling that registration to its recognized trademark holder for a profit. At the international level, however, only the Common Industrial Property Regime of the Andean Community of 2000 makes explicit reference to web domain names (Chartrand 2001). If a trademark takes the form of a logo, it emerges from the Arts; if it takes the form of a name or word then arguably it emerges from the HSS.
8.46 The word ‘trademark’ entered the English language in 1838. Functionally, however, it can be traced back to ancient times and in Western Europe from at least the 13th century including masons marks, goldsmiths marks, paper makers’ watermarks and watermarks for the nobility, and printers’ marks. While the 1618 case of Southern v How is considered the birth of commercial trademark law in England, the first national trademark legislation was enacted in France in 1857 followed by Britain in 1862. In the United States, the first trademark legislation was passed in 1870 based on the patent and copyright clause of the Constitution. It was, however, repealed and replaced in 1881 with legislation based on the commerce clause of the Constitution. This legislation was intended to allow trademarks to be used in commerce with foreign nations and Indian tribes (University of Texas Libraries 2004). In Britain, the Trade Marks Registration Act of 1875 required a legal register of marks and the first Trade Marks Registry in the world opened in London in 1876 (UK Patent Office 2003).
8.47 Registration and the payment of fees are required. A trademark is granted only for new marks so as not to confuse the public. It is available to both natural and legal persons. And, unlike other forms of IPRs, trademarks can be renewed, potentially in perpetuity.
8.48 Designs and patents use a utilitarian matrix to embed or tool knowledge into a tangible material form. Knowledge for design is mainly from the Arts; for patents, mainly from the natural & engineering sciences.
(a) Designs
8.49 Industrial design involves the arrangement of elements or details that contribute a distinctive aesthetic appearance rather than a function to a good. In this sense there is a relationship between copyright protecting a work of art and industrial design. Both involve aesthetics but in the case of a copyright the aesthetic element is fixed in a matrix that has no utilitarian value. By contrast the aesthetic element of industrial design is fixed in a utilitarian matrix, e.g., a coffee cup without a design retains its function. In addition, an original work of art tends to be unique while an industrial design is usually produced in large numbers. This last distinction, however, is of diminishing significance.
(a) Designs
8.50 Industrial design protection can be obtained by both natural and legal persons. Industrial design emerges from the Arts. It is important to note, however, that industrial design evolved from copyright in the British Commonwealth but from patents in the United States. Design protection
148
is granted for a fixed time period (for example, 14 years in the United States) after which the design enters the public domain. Registration and payment of fees are required. Industrial design cannot be renewed.
8.51 The first design-related legislation in Britain was the Designing & Printing of Linen Act of 1787. The Copyright of Design Act of 1839 extended protection to other textiles but it was not until the Design Act of 1842 that protection was extended to other manufactures including designs made up of functional elements (UK Patent Office 2001). In the United States, an 1842 statute granted a ‘design’ patent for new and original designs for a manufacture or printing on a fabric (Ladas & Parry 1999). In the American case, industrial design protection thus developed out of patents.
(b) Patents
8.52 Since the 15th century governments in the West have granted legal protection, enforced by the coercive powers of the State, to those who create or make available knowledge new to that State. At first ‘import patents’ (David 2001, 7) [D] were granted to foreigners bringing new working knowledge. The first known English patent was granted by Henry VI to Flemish-born John of Utynam in 1449 for a method of making stained glass not previously known in England but required for the windows of Eton College. Gradually such protection was extended to domestic inventors (UK Patent Office, 2004).
8.53 Patents are granted for new and useful compositions of matter (e.g., chemical compounds, foods, and medicinal products), machines, manufactured products and industrial processes as well as to improvements to existing ones. In some jurisdictions, patents can also be granted to new plant and animal forms developed through genetic engineering. Patents, unlike industrial design, emerge from the natural & engineering sciences rather than the Arts.
8.54 Through case law and amendment, U.S. patents have, over time, evolved into three types: patents of invention, design patents and plant patents. In all cases, registration is required and fees must be paid. To be patentable, an invention, design or plant must be novel, useful and, non-obvious “to one of ordinary skill in the art.”
8.55 A description of the invention must be deposited, in writing and drawings, sufficiently detailed to allow one of ordinary skill in the art to replicate the invention. This insures that new knowledge enters the public domain while the rights of the inventor are protected. In the case of microorganisms, description can take the form of a deposit of a sample with an authorized depository. Patent protection is for a fixed period of time (in the U.S., currently 20 years from the date of filing) after which it enters the public domain. It can be obtained by natural and legal persons. In general, these terms and conditions hold in all countries in the Anglo-American tradition. Patents cannot be renewed.
8.56 The term ‘patent’ entered the English language in the 14th century. Patents for invention were originally just one form of monopoly
149
granted by the British Crown. Such grants were signified by Letters Patent, open letters marked with the King’s Great Seal.
8.57 By the time of James I, abuse of the monopoly system had become so great that the Statute of Monopolies was enacted in 1624. It made all patent monopolies illegal except for “any manner of new manufactures within this Realm to the true and first inventor”. Furthermore, such monopolies could not be “contrary to the law nor mischievous to the State by raising prices of commodities at home or hurt of trade”. For some 200 years the patent system in Britain developed through case law without statute. It was not until the Patent Law Amendment Act of 1852 that a formal patent act came into existence (UK Patent Office, July 13, 2004).
8.58 The first U.S. patent act: “An act to promote the Progress of Useful Arts” - was introduced in 1790. Its legal status was based, however, on Article 1, Section 8, Clause 8 of the 1787 Constitution of the United States which states:
Congress shall have power ... to promote the progress of science and useful arts by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.
8.59 Know-how and trade secrets use a person – natural or legal - to embed knowledge in material form. Secrecy is used to protect both types and in most countries there is no formal statute. Trade secrets and know-how are the least protected of any intellectual property right.
(a) Know-How
8.60 The term “know-how” entered the English language in 1838. It refers literally to knowing how to do something, e.g., how to run a construction project. It includes knowledge and experience of an administrative, commercial, financial or technical nature used in running a business or performing a profession. It is experiential in nature, i.e., it is acquired through practice and experience. It also tends to be ‘tacit’ rather than ‘codified’ and embodied in an individual rather than in an external matrix. In most countries, know-how is protected by contract binding employees and other agents to confidentiality. When a natural or legal person (including a government) discovers that know-how has been revealed by an agent without permission, legal recourse is available through breach of contract before the courts. No registration is required. Know-how can be protected without time limit. It can emerge from any of the three knowledge domains – NES, HSS or the Arts.
(b) Trade Secrets
8.61 Trade secrets involve information of a technical or commercial nature that is not in the public domain nor generally available. It may be a formula, pattern, physical device, idea, process, compilation of information or other information that provides a competitive advantage in the marketplace. It is generally protected by contract binding employees and other agents to confidentiality. Normally the courts
150
require that a trade secret be treated by its owner in such a manner that it can reasonably be expected to prevent the public or competitors from learning about it except by improper acquisition or theft. In the case of electronic data this includes using encryption and “password” technologies. The most famous trade secret is the formula for Coca-Cola. A trade secret may be embodied in written or other codified form or it may be tacit in a natural person. No registration is required. There is no time limit on a trade secret as long as it remains secret. It may emerge from any of the three knowledge domains – NES, HSS or the Arts.
8.62 While know-how and trade secrets are often used as synonyms they need not be so. In the case of management and franchises, for example, know-how is usually accessible to third parties when being used. Single elements may be kept secret but the overall concept cannot be. Where in a nation’s judicial hierarchy infringement of trade secrets or know-how may be heard varies, e.g., in the United States it is at the State level. Some international conventions, e.g., TRIPS and the Andean Pact Industrial Property Convention recognize infringement of both. In effect, when a senior executive moves from a company in one country to one in another, an international form of ‘legal’ lobotomy is in force; the executive and new employer may both be held liable for infringement. In William Gibson’s future world of Neuromancer, corporations protect their know-how and trade secrets by implanting “neural bombs” (Gibson 1984). If an employee’s loyalty slips, the bomb goes off killing or mentally maiming: the bottom line is that the knowledge is protected.
8.63 Sui generis in Latin means “of its own kind”. There are a number of recognized sui generis property rights. The United States, in particular, has made extensive use of such rights including: breeders’ rights for ‘lines’ of plants and animals generated using pre-genomic ‘selective breeding’ technology; a special depository right for microorganisms in lieu of traditional patent requirements of a written description and drawings; special rights for visual artists of recognized stature; special rights for architectural works; and, special rights for integrated circuit typographies, the so-called ‘Chip Protection Act’. The European Commission’s Directive on the Legal Protection of Databases is another example of:
a new form of copyright in databases, one that extends to contents previously in the public domain and otherwise not copyrightable. It narrowly restricted the application of the principle of allowing exclusions for “fair use” in research, and it permitted virtually indefinite renewal of copyright protection for databases without requiring the substantial addition of new and original content.” (David 2000, 6)
8.64 It can be anticipated that many new sui generis rights will emerge as nations compete by combining different elements drawn from their own traditions governing copyright, designs, patents, trademarks, trade secrets & know-how.
151
The only constraint under the WTO and other international trade rules is national treatment
8.65 In a sense the public domain is an unexplored country whose borders can be outlined but whose interior remains unknown, unexplored and uncharted. Thus James Boyle notes that the 2001 Duke University law conference on the public domain was “the first conference on the subject” (Boyle 2004a, 1). Furthermore, he identifies David Lange’s 1981 article “Recognizing the Public Domain” as having “really initiated contemporary study of the subject” (Boyle 2004b, 59). In this unknown country resides the vast bulk of human knowledge acquired through all four faculties of knowing in all knowledge domains and practices throughout human experience including pre-history. To paraphrase Rosenberg on science, the body of knowledge called ‘the public domain’ consists of an immense pool to which small annual increments are made at the ‘frontier’. The true significance of the public domain is diminished, rather than enhanced, by extreme emphasis on the importance of the most recent ‘increment’ to that pool, e.g., IPRs (Rosenberg 1994, 143). [E]
8.66 For the competitiveness of nations in a global knowledge-based economy, such ignorance cannot continue. To cure it, however, requires accepting the inherent limitations imposed by the immeasurability and incommensurability of knowledge. Accordingly, trans-disciplinary induction will be conducted and a circumambulation of the question made looking at it from a number of different perspectives and interpreting findings as symbolic of its numinous meaning (Neumann 1954, 7). Put another way: “A definition can be but one of many definitions, each surely a function of perspective and agenda” (Lange 2004, 463). At this time, I will examine the public domain as:
· economic commons;
· legal principle and precedent, and,
· constitutional & cultural history.
8.67 Like technological change in economics, the public domain is, in law, treated as a residuum. Traditionally in economics after the contribution of changes in capital, labour and natural resources to economic growth has been calculated, the residual is technological change. In law, after new knowledge has been ‘privatized’ as intellectual property, what remains is the public domain (David 2000, 15). [F] In this sense, the public domain is the opposite of property (Boyle 2004a).
8.68 Extending the parallel, the public domain is where knowledge is at home as a public good, i.e., non-excludable and non-rivalrous, acting, as will be seen (9.0 Production Function, Technological Change), like disembodied exogenous technological change. Everyone has the right to know; it falls from heaven like manna (Scherer 1971, 347). Knowledge covered by intellectual property rights, on the other hand, is rivalrous and
152
excludable by law, if not by nature. It is embodied (fixed) in a work of aesthetic or technological intelligence that is the possession of its creator (or, more usually under Common Law, a proprietor) who determines access and application. To put it another way, where intellectual property rights ‘privatizes’ or encloses new knowledge (Boyle 2004b) and limits access through price and other mechanisms, knowledge in the public domain is free to all without cost or restriction.
8.69 The public domain has also been considered an intellectual or ‘public knowledge commons’ (David 2000). In general, an economic commons is a natural resource shared by all but owned by none. Problems of over-use and depletion of common resources, e.g., fish in the seas beyond the territorial limits of any nation-state, has been called the ‘tragedy of the commons’ (Hardin 1968). Mainstream economics recommends creation of property rights, i.e., privatize ownership of the resource to guarantee its survival through the operation of self-interest on the part of its new owner or owners (e.g., Demsetz 1967).
8.70 This argument has been extended to the encouragement of new knowledge through intellectual property rights that, in effect, privatize new knowledge. The economic rational is that given the public goods nature of knowledge, a producer cannot capture revenues to cover costs, let alone earn profits, in the absence of such rights. The resulting monopoly, e.g., copyrights and patents, can be justified, however, by the full public disclosure of new knowledge, e.g., through full patent application disclosure or publication, and, its eventual total and complete absorption into the public domain. Society benefits because expansion of the public domain contributes to economic growth by enriching the economic knowledge base of everyone who wants to know.
8.71 The public domain, however, is unlike any natural resource commons. Most obviously, the public domain is artificial - it is human-made. And, as Herbert Simons stresses, there is a need for a clear epistemological distinction between the sciences of nature and ‘the sciences of the artificial’ (Layton 1988, 91). Similarly, a clear distinction must be made between the economics of the public domain and those of natural resources.
8.72 In many ways the public domain is the inverse of a natural resource commons. First, use of the public domain does not reduce the quantity of resources available to others. Second, in its normal state the public domain grows and will continue to grow until the collapse of human civilization in its contemporary incarnation. Such growth may be slowed by IPRs and other impediments but the biological need ‘to know’ insures growth of the public domain. Third, while there can be no subtractions from the public domain through use, additions are not simply additive. Rather, additions combine with existing knowledge mutating and generating yet more new knowledge. Or, in terms of Isaac Newton’s famous aphorism: “If I have seen further it is by standing on the shoulders of Giants.” The public domain is not a domain of scarcity but of fertile abundance. In this sense the public domain, unlike any natural resources commons, exhibits ‘increasing returns to scale’.
153
8.73 Paul David has observed that intellectual property rights have not been created “by any rational, consistent, social welfare-maximizing public agency” (David 1992). The resulting IPR regime he characterizes as ‘a Panda’s thumb’, i.e., “a striking example of evolutionary improvisation yielding an appendage that is inelegant yet serviceable” (David 1992). In the case of the public domain, he observes that “what it contains is not defined and legal ‘rights’ to its use are not delineated” (David 2000, 15). This legal lacunae is the result, I argue, of an inherent clash between the public domain interpreted as a legal principle and as a legal precedent.
8.74 The term ‘public domain’ entered “Anglo-American copyright discourse through the French of the Berne Convention” in 1886 (M. Rose 2003, 84). The public domain is thus rooted in the European Civil Code based on principle rather than precedent as is Anglo-American Common Law. In turn, the Civil Code draws heavily on the old Roman law especially the Institutes of Justinian from which Justice Yates argued that ideas are like wild animals belonging to everyone and no one (see para 8.16 above). Observing the relative lack of interest in the concept of common property over the last three hundred years of Anglo-American legal tradition, Carol Rose has tried to revivify Roman concepts of public property lacking in the English-speaking tradition. In effect, she concludes that the evolution of Anglo-American law has been dominated by questions about private, not public, property (C. Rose 2004).
8.75 There are five categories of public property under Roman law: res nullius, res communes, res publicae, res universatitis and res divini juris. To begin, the Latin word res means ‘thing’. Res nullius refers to things that are unowned or have simply not yet been appropriated by anyone such as an unexplored wilderness. Res communes refers to things that are open to all by their nature, such as oceans and the fish in them. Res publicae refers to things that are publicly owned and made open to the public by law. Res universitatis refers to things that are owned by a body corporate, i.e., within the group such things may be shared but not necessarily outside the group. Finally, res divini juris (divine jurisdiction) refers to things ‘unownable’ because of their divine or sacred status (Kneen 2004).
8.76 While arguably knowledge exhibits all five characteristics, for now, I restrict myself to contending that the Civil Code ‘public domain’ derives from such Roman legal concepts. They are not, however, the underlying source of Anglo-American usage. Precedent is its source. In this case the precedent is two-fold. First, import patents were introduced in 15th century England to increase the national knowledge-base (the economic public domain) and hence competitiveness. They were granted for fixed periods (usually 14 years corresponding to two generations of apprentices who could work for the foreign ‘inventor’ but not compete). After the patent lapsed the knowledge became competitively available to the third generation and beyond, i.e., the knowledge entered the economic public domain (David 1992). [G]
154
8.77 Second, as will be described in greater detail below, copyright began in the 15th century as a licensing law for a new technology: the printing press and its entrepreneurial owner – the printer. Licenses were required for everything printed in order to prevent heresy and sedition. It quickly became apparent to the Tudor monarchs (as well as those of continental Europe) that it was much easier and effective to control a limited number of presses than a large number of subversive or heretical authors. A hand written manuscript could, after all, be read by only relatively few; typeset copies, on the other hand, could be read by and corrupt many. Copyright licenses granted to printers were perpetual, at the pleasure of the Crown, and no rights were granted to the author.
8.78 Three conclusions can be drawn. First, in the Anglo-American tradition the public domain is what the government of the day says it is, i.e., it is a political decision, it is not ‘natural law’ based on principle. Second, the public domain constitutes the shared or common ‘knowledge-base’ of the national economy. Third, flowing from the first two, the Anglo-American public domain is continually threatened by the monopolistic tendencies of printers and their corporate proprietary descendents. As will be demonstrated, history has emboldened proprietors to use the image of the starving artist as a foil to extend their monopoly and expand profits. In the 1750s, this played out as the ‘Battle of the Booksellers’ (Paterson 1993). Today, it is called the ‘Second Enclosure Movement’ fueled by, among other things, the ubiquitous spread of blanket licenses (Boyle 2004b). In a sense, the Anglo-American public domain can be cited as a triumph of precedent over principle. To understand why, however, requires a different focus, that of the constitutional and cultural history of the public domain.
Constitutional & Cultural History
8.79 After crushing the royal prerogative over patents with the 1624 Statute of Monopolies, for some 200 years the patent system in Britain developed through case law without statute. It was not until the Patent Law Amendment Act of 1852 that a formal patent act came into existence (UK Patent Office, 2004). The first U.S. patent act: “An act to promote the Progress of Useful Arts” - was introduced in 1790. In both countries, however, there was no perceived conflict between the patent monopoly and the public domain because of its relatively short duration after which any embodied or tooled knowledge entered the public domain growing the national knowledge-base. This relatively quiet development was not, however, the case with copyright whose development is intimately linked to freedom of the press, the public domain, popular democracy and our rights to know in general. Accordingly, I offer a somewhat detail review of these developments in the UK and the United States.
8.80 The word ‘copyright’ itself entered the English language only in 1735 (OED, copyright). Nonetheless, with the introduction of William Caxton’s printing press (the first engine of mass production) in 1476, the first copyright law was, in effect, introduced (Chartrand Fall 2000). Under Common Law, many rights initially derive from inscribing or copying one’s name and explaining one’s ‘title’ to property on a register. Thus in medieval England to obtain the right to farm a particular piece of
155
land, one’s name had to be inscribed or written, by oneself or a scribe of Church or State, on a register of tenants. This was, and still is, called ‘copyhold’ to the land. With introduction of the printing press, licensing laws required printers to inscribe their name, location and titles of works they wanted to print on a register. If approved by the Crown for publication, a copye was granted to the printer. The rights flowing from this copye constituted “copyright” and were held in the name of the printer, not the author. This copyright was perpetual, held at the pleasure of the Crown. “The question of rights of authorship was largely disregarded, since much of the demand was for extant works (like the Bible) that were in the public domain, and whose authors - even when identified - were long since dead” (David 1992). As for living authors, they were treated according to the Renaissance tradition of the honorarium, i.e., an initial one-time payment extinguishing all rights to the work (Woodmansee 1984, 434). Under contemporary copyright, this is called an ‘all rights’ or ‘blanket license’.
8.81 The religious wars that swept over Western Europe after the Protestant Reformation of the 16th century reached England but took a peculiar constitutional as well as religious twist: Caesarpapism. German Protestants fought against the Petrine Doctrine of the Church of Rome claiming the Pope as successor of St. Peter. In England, however, Henry VIII broke with Rome using the competing Caesaropapism Doctrine of the Byzantine Church claiming the king as God’s anointed Vicar on earth in the tradition of King David, i.e., the Divine Right of Kings (Cantor 1969, 55, 90). In one stroke, Henry VIII achieved what had eluded western Europe since the fall of Rome – the marriage of Church and State. He followed up with an official translation of the Bible into English which was published in 1539. This literary break with Latin was only finalized, however, with the King James’ version in 1611 which became The Great Code of the English language (Frye 1981).
8.82 Thus, unlike continental Europe, England fractured into three not two warring camps: Catholic, Protestant and Anglican or Church of England. This trinary power struggle for the soul of England was to have profound implications for the development of the natural experimental sciences; definition of the public domain as freedom of the press; increasing tolerance of religious difference; and, in the United States, constitutional separation of Church and State.
8.83 In 1557, Queen Mary granted a charter to what became the Company of Stationers of London. Stationers’ Copyright was based on royal prerogative or letters patent covering the entire publishing industry as an estate. This monopoly was assigned to members as a freehold interest. No consideration was given to author’s rights. The Stationers’ Company was the only ‘guild’ monopoly to escape dissolution under the Statute of Monopolies in 1624. The reason was its political utility in fostering the political and religious orthodoxy of the day (Patterson 1993). [H]
8.84 From the death of Henry VIII, England entered a time of troubles. Each ruler – the Catholic Mary, Anglicans Elizabeth I & James I, quasi-Catholic Charles I, Puritan Cromwell [I], quasi-secular or
156
sensualist Charles II, Catholic James II and the first constitutional monarch, Queen Anne – faced opposition from two-thirds of the population and struggled to maintain political and religious control. By restricting freedom of the press they tried to limit what could enter the public domain of thought. The instrument of control was the licensing law that maintained the perpetual copyright of the Stationer’s Company.
8.85 Two key developments are of relevance to the question at hand. The first was the Restoration of the monarchy in 1660 and the constitutional and cultural compromises that accompanied it. The second was the Glorious Revolution of 1689 that installed Queen Anne as the first constitutional rather than ‘divine’ monarch followed by passage of the first modern copyright act, the Statute of Queen Anne of 1709. As will be seen these developments continue to haunt contemporary policy debate about intellectual property rights and our rights to know.
8.86 First, during Cromwell’s Commonwealth or Protectorate, the Protestants or Puritans were the titular winners but they were divided into many squabbling sects and could not agree among themselves. Cromwell, as Lord Protector, tried to mitigate their differences as well as those of Catholic and Anglican citizens. In the end, however, he gave up and approved the Restoration of the monarchy after his death. It was during the Protectorate, however, that the great Latitudinalist compromise of Robert Boyle was made (Jacob 1978; Jacob & Jacob 1980). Theologically, Boyle freed Anglican, Catholic and Protestant to read God’s other book, the book of nature using the new experimental philosophy. His success was marked by Charles II chartering the Royal Society in the year of the Restoration 1660. It was also during the Protectorate that the living author began to compete with the ancients and John Milton in his 1644 Areopagitica (1608-1674) began the cry for freedom of the press. Subsequently, John Locke (1632-1704), in his Memorandum of 1694, argued for press freedom and against both Stationers copyright and perpetual copyright for the author. [J]
8.87 Second, the final constitutional battle between the Monarchy and Parliament occurred with “The Glorious Revolution of 1689” when the last of the Stuart monarchs, the catholic James II, was deposed by an Act of Parliament and replaced by his ‘protestant’ daughter Anne and her consort William of Orange. The resulting ‘Bill of Rights’ established free speech in Parliament marking the beginning of a ‘free press’ in England.
8.88 In 1695 the last of the Licensing Acts lapsed. Government control was henceforth limited to post-publication libel law. Suspension further spurred development of “a free press’ that could publish without prior consent of the authorities. Without the Licensing Act, however, the Stationer’s Company perpetual copyright also lapsed and a rival appeared on the horizon – Scotland. While England and Scotland had been under the same monarch since 1603 they remained separate countries with separate legislatures and separate laws. This meant that the Stationer’s Company’s copyright did not have force in Scotland. As long as the licensing laws were in place London booksellers could limit
157
the competition. With their expiration, however, the competition began to grow.
8.89 There were many attempts by the Stationer’s Company to restore the old licensing system in the late 1690s and early 1700s, but it was not until 1710 that a new copyright system was enacted. In fact between 1695 and 1710, Scottish and domestic ‘pirates’ made it increasingly difficult for London booksellers. Without the protection of a Licensing Act, any pirate could take a successful work, re-typeset it and then sell it at a much lower price with no payments to author, editor or promotion.
8.90 An Act for the Encouragement of Learning, by Vesting the Copies of Printed Books in the Authors or Purchasers of such Copies, during the Times therein mentioned of 1710, more commonly called the Statute of Queen Anne, had three objectives. First, it was intended to prevent any future monopoly of the book trade. Second, it was intended to draw Scotland under a common copyright law and thereby to resolve the ‘piracy’ controversy. Third, it was intended to encourage production and distribution of new works. The vehicle chosen to achieve all three objectives was the author.
8.91 Until the Statute, the author had no economic and limited moral rights to a work after it was sold. Generally, a work was bought outright by a printer/bookseller/publisher for a flat one-time fee much like an all-rights or blanket license today. No royalties flowed to the author from subsequent sales. They did enjoy certain ‘moral rights’ including the right not to have the text changed and the right of attribution. Such rights, however, were based on ‘ethical’ practices of the printers’ guild, not law.
8.92 The Statute of Queen Anne is considered the turning point in the history of copyright because it was the first law to formally recognize an author’s rights and, more importantly, it ended prior censorship through pre-publication licensing of works. Recognition of an author’s rights by the Statute was, however, principally a device to attain its primary objective - abolition of the Stationer's monopoly (Feather 1988: 31-36). In effect, it was a trade regulation bill and did not recognize inherent and inalienable rights of the author (Shirata 1999). [K]
8.93 In the end, the Statute of Queen Anne granted an extension of the existing copyright monopoly of the Stationer’s Company for 21 years and granted an exclusive right for new works for fourteen years with an option to renew for the same period. Furthermore, the Statute recognized the author as the initial copyright holder to encourage “learned men to compose and write useful books”. However, it also explicitly recognized the financial interests of “proprietors” who, by sale or assignment of the author's initial copyright, were almost invariably printers/booksellers/ publishers.
8.94 The Stationer’s Company, however, did not give up. The London booksellers told tragic tales of piracy ruining honest businessmen, their wives and children. Literary works were the inheritances of innocents and pirates were, in effect, stealing from the mouths of babies. These tales of piracy were adopted not just by the
158
booksellers but also by those advocating authors’ rights and used to illustrate the implications of lax copyright protection for authors. It is important to keep this distinction in mind: printer’s copyright vs. author’s rights. The episode was called ‘the Battle of the Booksellers’ (Shirata 2000).
8.95 A number of cases were brought to court by printers/ booksellers/publishers during the 1750s and 1760s to gain recognition of a common law copyright independent of the statutory rights established by the Statute of Queen Anne. Publishers argued that an author is entitled to enjoy the fruit of his labor, just like all other forms of property - in perpetuity. A publisher, being merely an assignee of the rights of the author, should therefore also enjoy such rights in perpetuity independent of statute. It was not, however, until 1769 that a legal decision was rendered on the issue in Millar v. Taylor. Lord Justice Mansfield decided, with the majority, in favour of an author’s perpetual copyright while Justice Yates, as has been seen, opposed it. [L]
8.96 Sir William Blackstone contributed to the plaintiffs' cause. Blackstone had previously published Commentaries on the Laws of England in 1767 in which he interpreted copyright for the first time as a legal concept (Blackstone 1771: 400-407). Using Lockean natural law theory (Locke 1690), he described copyright as a kind of personal property in common law on the ground that any kind of published work is based on the author's brainwork. This became known as ‘the sweat of the brow’ theory. Of course, in his Memorandum, mentioned above, Locke explicitly rejected perpetual copyright.
8.97 The plot of the booksellers was, however, ultimately defeated in 1774 by the decision of the House of Lords in Donaldson v. Beckett. It was this decision that established the basic concept of Anglo-American copyright. When an author fixes his creation in a tangible medium, he obtains a common law right that is eternal in nature. However, he looses this common law right with publication, or, ‘dedication to the public’. In effect, the House of Lords accepted the dissenting opinion and reasoning of Justice Yates in Millar v. Taylor:
8.98 What is at issue is that the living author had attained the status of genius, someone who produces with god-like powers out of nothing (Woodmansee 1984). However, the reward for such genius was qualified by the Enlightenment rights of the public at large (M. Rose 2004, 76). Thus while in a sense the work of the artist, author or inventor was god-like and qualified as res divini juris, they were also res communes - open to all by their nature and res publicae publicly owned and made open to the public by law, i.e., by statute.
8.99 The change, however, was less a boon to authors than to publishers, for it meant that copyright was to have another function. Rather than simply being the right of a publisher to be protected against piracy, copyright would henceforth be a concept embracing all the rights that an author might have in his published work. And since copyright was still available to the publisher, the change also meant that the
159
publisher as copyright proprietor would enjoy any new rights granted the author by appropriation (Patterson 1968).
8.100 Thus, what started out in 1710 as a statutory device to regulate the book trade, prohibit monopoly and end pre-publication censorship, was transformed, at least in the popular imagination, into a ‘natural law’ for the encouragement, protection and reward of authors. In reality, however, author’s rights - economic and moral – were effectively sacrificed to the pecuniary interests of Proprietors. Once a work was typeset and published the author’s Common Law rights vanished like a wild animal into the forest leaving behind a Proprietor enjoying the rights and privileges granted by an admittedly now time limited monopoly. [M]
8.101 It has been argued that the public domain only came into existence with the end of perpetual copyright (M. Rose 2004). And this was the state of English law in 1776 after which the laws of England were transformed into the Common Law of a post-revolutionary United States of America. While there were Licensing Acts in most of the colonies, before the 1780s only Massachusetts had a formal copyright statute. There were three reasons:
8.102 First, despite the fact that works of American authors were published in America, the number of works was limited and a large proportion of the American market was dominated by British authors. Second, authors in the colonies were usually also editors and publishers themselves. There was a sentiment or trade rule called “courtesy copyright” or “mutual obligation” among publishers, which effectively suppressed piracy. Third, there was little or no conflict of market share among publishers on account of the extensive and growing American market. The market was also strictly segmented. Each publisher often supported a specific political group (Shirata 2000).
8.103 A year before the House of Lords made its decision on Donaldson v. Beckett, the Boston Tea Party marked the beginning of the American Revolution. Between 1773 and 1783 the United States was at war with Great Britain and there was no trade between the two – including in law books and legal decisions.
8.104 Accordingly, the last major copyright decision of the British courts current in legal circles in the United States was Millar v. Taylor of 1769. The majority opinion penned by Justice Mansfield - that there was a ‘natural’ perpetual author’s copyright - held sway unqualified by the subsequent decision of the House of Lords in Donaldson v. Beckett.
8.105 As the revolutionary war played itself out the publishing industry in the colonies increasingly turned towards American authors. However, the trade courtesy that protected printer/publishers afforded no protection to authors. Some authors began to lobby for ‘copyright’ protection confusing ‘author’s rights’ with the traditional copyright granted to printers.
8.106 The framers of the United States Constitution, suspicious of all monopolies, knew the history of copyright as a tool of censorship and
160
press control. They wanted to assure that copyright was not used as a means of oppression and censorship in the United States (Loren 1999). This consuming fear of monopoly and censorship is captured in the words of Thomas Jefferson:
“I have sworn upon the altar of God, eternal hostility against every form of tyranny over the mind of man.”
Thomas Jefferson,
Letter to Dr. Benjamin Rush, September 23, 1800.
8.107 And, with respect to the copyright monopoly and the 1774 reasoning of Chief Justice Mansfield in Millar v. Taylor,
Thomas Jefferson, in 1788, exclaimed: “I hold it essential in America to forbid that any English decision which has happened since the accession of Lord Mansfield to the bench, should ever be cited in a court; because, though there have come many good ones from him, yet there is so much sly poison instilled into a great part of them, that it is better to proscribe the whole.” (Commons 1924: 276)
8.108 The US Constitution was adopted in 1787 and ratified a year later. Article I, Section 8 of the Constitution is now known, alternatively, as the ‘Intellectual Property’, ‘Copyright’ or the ‘Exclusive Rights’ Clause (Benkler 2004) and states:
The Congress shall have Power... To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;
8.109 The importance of the clause is evidenced by the fact that the power to promote ‘progress’ was one of very few powers to regulate commerce initially granted to Congress. Two years after ratification of the US Constitution, Congress passed the first Copyright Act of 1790: An Act for the Encouragement of Learning, by securing the Copies of Maps, Charts and Books, to the Authors and Proprietors of such Copies, during the Times therein mentioned. Two things are important with respect to the title of the Act. First, Article 1, Section 8 of the Constitution assigns rights to ‘Authors and Inventors’ reflecting the proximity of copyright and patents and its relationship to the natural person as genius. The 1790 Act, however, assigns rights to ‘Authors and Proprietors’. As in England, author’s rights were compromised in favour of the pecuniary interests of proprietors who increasingly were legal not natural persons. The Common Law fiction that natural and legal persons have the same rights thus allows bodies corporate to hold copyrights justified as a reward for individual creativity.
8.110 Second, its title derives from the Statute of Queen Anne justifying the ‘securing the Copies’ as an encouragement for learning among the people. The importance of ‘learning’ led to the ‘Fair Use’ clause of the U.S. Copyright Act limiting copyright even during its duration. In the simplest terms, it means: nonprofit copying is fair use. This provision allows public libraries, educational institutions and individuals to copy works without paying royalties and avoid copyright
161
infringement. This encouragement of learning, of course, amounts to increasing the personal & tacit knowledge-base of the nation.
8.111 Arguably, the First Amendment of the U.S. Constitution is directly related to copyright and hence to an American concept of the public domain (Alstyne 2004):
Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances.
8.112 The historical connection between the two is the pre-Statute of Queen Anne Licensing Acts which were used to control the press and restrict the public domain. These, at one and the same time, were used to restrict the press and maintain the perpetual copyright of the Stationer’s Company. In this sense, the First Amendment can be seen as a sibling of modern copyright with both serving to define the public domain. David Lange takes this argument further arguing that the public domain itself should be recognized as having a status analogous to citizenship with affirmative rights. “I want the public domain, however it may be defined, to secure these elemental aspirations which I believe innate in human kind: to think and to imagine, to remember and appropriate, to play and to create (Lange 2004, 483).
8.113 To any mapping of the public domain charted by the First Amendment and the Copyright Act one must add the more recent Freedom of Information Act that makes all government information part of the public domain unless national security or commercial confidentiality are involved. This last caveat ‘commercial confidentiality’ opens onto yet another tributary this one within the domain of the Security & Exchange Commission and the Department of Commerce. And the list goes on.
8.114 Unless the public domain as legal principle is reconciled with the public domain as legal precedent, Lange’s vision will, however, remain unrealized. In fact, the progressive extension of the term of copyright in the United States, now approaching 100 years – life of the author plus 75 years – suggests, however, that de facto perpetual copyright has already returned. This sense is enhanced by the ubiquitous spread of all rights or blanket licenses that extinguish a creator’s rights in favour of corporate proprietors who continue to press for more rights in order to preserve the starving artist. Increasing concentration of the media adds its own distinct monopolistic flavour to a brew that may realize Thomas Jefferson’s worst fears about copyright. A second American revolution, a legal revolution, may be in order.
8.115 The situation in the constitutional monarchies of the British Commonwealth, however, is even more problematic. Unlike the United States with its constitutional separation of powers, a central principle of constitutional monarchy is ‘the indivisibility of the Crown’. Power flows down in the name of Her Majesty, not up from the people as in republican systems. In federal constitutional monarchies such as Australia and Canada this indivisibility applies at the jurisdictional level,
162
e.g., the province of Saskatchewan in right of Her Majesty is indivisibly linked to the Dominion of Canada in right of Her Majesty. Similarly, the executive, legislative and judicial branches at either level of jurisdiction are subject to Her Majesty. As well, all private persons and property are subjects of Her Majesty. There can, accordingly, be no absolute private property rights. Everything and everyone is subject to the pleasure of Her Majesty. In political terms, this means, for example, that a ‘Bill of Rights’ such as the Canadian Charter of Rights and Freedoms, unlike the American First Amendment, is, in effect, subject to a ‘notwithstanding’ clause that allows a parliamentary or legislative majority ratified by Her Majesty’s representative - the Governor General of the nation, or the Lieutenant Governor of a Canadian province - to abrogate any and all rights contained therein including a free press and definition of the public domain.
8.1136 What started as an exploration of the economics of new knowledge as intellectual property rights or ‘rights to know’ has ended with the politics of the First Amendment of the U.S. Constitution and national constitutions in general. How? Arguably it was our trip through an unexplored country called the public domain. Therein a free press is historically linked to copyright and, indirectly, to the evolution of patents and intellectual property in general. Arguably, Adam Smith’s alarm about a ‘political economy’, i.e., one in which economic profit translates into political power and political power translates into economic profit, is being recycled in modern times.
8.117 Nonetheless, the relationship between political power and economic profit is an increasingly central theme of the knowledge-based economy. In the crudest terms, a knowledge-based economy means the monetarization of knowledge. Political power writes the intellectual property statutes defining knowledge as economic property. Private proprietors strive to maximize profits including by re-structuring the environment through such statutes. According to Jessica Litman with respect to copyright this has got to the point that the “copyright industries… work out the details of the copyright law among themselves, before passing the finished product on to a compliant Congress for enactment” (Litman 1996). [N] In other words, if the intellectual property regime of a nation is the economic constitution of the knowledge-based economy then it is simply too important to be left to proprietors. The regime itself is justified primarily as a reward for creative genius. The public domain, which arguably an IPR regime is intended to serve, is a national asset in and of itself, a pearl without price. It is an asset whose value should not be lost in pursuit of private pecuniary profits. The public domain is a good and its growth the reason for intellectual property rights in the first place.
8.118 From our analysis of ‘rights to know’ a legal qubit of knowledge can be deduced. The IPR is a qubitic measure of the privatization of knowledge established by law. Intellectual property rights are granted for
163
new knowledge fixed in a material matrix for a limited time. The matrix may be utilitarian (u) as with patents & designs; it may be non-utilitarian (nu) as with copyrights & trademarks; or it may be a person (p) – natural or legal - as with trade secrets and know-how. All other knowledge (new and old) eventually falls into the public domain (pd). The IPR is therefore some function of u, nu, p, pd.
8.0 Rights to Know
[A] HHC: There is a distinct Islamic copyright tradition based on Islamic law - the Shar'ia. The following summary is based on private correspondence between the author and Mustafa Salman Habib, Ph.D, Barrister at Law (Lincoln's Inn) in London England (Habib 1998). The roots of Islamic copyright lay in the Koran and the traditional portion of Islamic law based on the Prophet Mohammed's words or acts but not written by him and known as the "Sunna". This traditional portion of Islamic law is accepted as authoritative by the Sunni branch of Islam but rejected by the Shi'ite branch. One relevant saying in the Sunna is: “the works of a person do not cease even after his death are three: a continuing charity, a beneficial know-how or a worthwhile son”. Such ‘know-how’ is recognized as generating a continuous benefit that outlives the author. Sunni jurists are also unanimous in their high regard for the author, researcher and scientist who are collectively called “A'Lem” to whom several references are made in the Koran and the Sunna.
Early Islamic jurists recognized copyright and offered protection from pirates. Unlike written legal codes of today, traditional Islamic copyright treated copyright infringement as a breach of ethics, i.e. a moral rather than a criminal act. Punishment took the form of defamation of the infringer and casting shame on his tribe. An exception was blasphemy or incitement against Islam. The infamous case of Salman Rushdi is an example of what an author can expect if convicted of writing such a work. Only in recent years have formal copyright statutes been drafted, e.g. in Saudi Arabia twelve years ago.
[B] “Although economists have written on topics of intellectual property for a long time, the impact of economics on public policy in this area has been slight, especially as compared to the influence of professional writings in areas such as antitrust and taxation. We believe that too few of the profession’s resources have been devoted to these issues and that, of those resources that have been employed, too few have been devoted to empirical analyses.” (Besen & Raskind 1991, 4)
[C] “Mr. Justice Yates had very clear and definite notions as to the limits of property, but a reference which he makes to the civil law throws a stronger light on his view of the whole subject than any of his direct reasoning. What the Institutes have to say relating to “wild animals,” he observes, “is very applicable to this case.” And he then proceeds to draw a comparison between these two singularly related subjects. Animals ferae naturae are yours “while they continue in your possession, but no longer. “ So those wild and volatile objects which we call ideas are yours as long as they are properly kenneled in the mind. Once unchain or publish them, and they “become incapable of being any longer a subject of property; all mankind are equally entitled to read them; and every reader becomes as fully possessed of all the ideas as the author himself ever was.” (Sedgwick 1879)
[D] “From the 14th century to the early 18th century in Europe, the issuance of letters patent’ and granting of royal privileges’ conferring monopoly rights in exchange for the disclosure of technological information was aimed primarily at effecting the transfer and application of existing industrial arts and engineering
164
practices, i.e., techniques already known to master-craftsmen and engineers in other territories; and not at inducing fresh inventive activity. Many early patent monopolies were, in effect, local franchises designed to shelter immigrating expert-practitioners from the subsequent competition of the apprentices and journeymen they were expected to train, or others who would try imitate them once their particular ‘mysterie’ had been successfully established in the new cities and principalities to which they were recruited.” (David 2001, 7, ft. 7)
[E] “The body of knowledge that is called ‘science’ consists of an immense pool to which small annual increments are made at the ‘frontier.’ The true significance of science is diminished, rather than enhanced, by extreme emphasis on the importance of the most recent “increment” to that pool.” (Rosenberg 1994, 143)
[F] “Although the concept of a distinct sphere demarcated as the “public domain” is well recognized under conventional intellectual property laws, what it contains is not defined and legal “rights” to its use are not delineated; “property” is what is defined by the law, and the public domain holds the residuum.” (David 2000, 15)
[G] “In the fourteenth century, such grants were employed to encourage the introduction of foreign technologies through the emigration of skilled artisans from abroad, as in the case of the letters patent given to the Flemish weaver, John Kempe, by Edward II in 1331, or the protection granted to two Brabant weavers to settle at York in 1336, or the similar grant conferred in 1368 upon three clock-makers from Delft. England at his time was technologically laggard in comparison to many regions on the continent of Europe, and, understandably, was endeavouring to “borrow” the more advanced industrial practices. It was hoped that the foreign master craftsmen would introduce English apprentices to the “mysterie” of their respective arts; but, because they were not likely to remain in control of the newly skilled workers once these had passed into journeyman’s status, a cohort of potential domestic competitors would thereby be created from whom the foreign master obviously wished to be protected.” (David 1992)
[H] “Queen Mary incorporated the Stationers’ Company “to set up a mode of regulating the English printing trade that would facilitate the efforts of the Romish clergy to stamp out the Protestant Reformation.” But the motives of the stationers “were of a less exalted kind.” Thus, Elizabeth, relying on the stationers’ self-interest, confirmed the Charter to turn the stationers to support the English, rather than the Romish church, and the Stationers’ Company became, in turn, the instrument of the Stuarts against the Puritans, in the early seventeenth century; the instrument of the Puritans, against their royalist enemies, when the Puritans came to power; the instrument of the royalists against the Puritans, after the Restoration; and, for a brief time, the instrument of the triumphant Whigs, after “the glorious Revolution” of 1688. But through all these vicissitudes, the stationers themselves steadfastly remained, what they had always been, eminently practical men; and they consistently protected their monopoly.” (Patterson 1993)
[I] HHC: Under Cromwell, the Licensing Act of the Long Parliament (1640-1660) affirmed the rights of individual publishers to their copies and forbade other publishers to “counterfeit” works of other publishers. This was necessary because Parliament had done away with the King’s Star Chamber, under whose provisions the copyright system had developed.
[J] “One of the earliest writers to agitate against the booksellers’ perpetual monopolies was John Locke. In 1693, the Licensing Act, [10] the instrument through which the Stationers’ Company was empowered to regulate the trade, faced renewal. Concerned particularly with the guild’s monopolies in Latin
165
writers, Locke wrote to his friend, Edward Clarke, a Member of Parliament, urging him to speak in Parliament for the interests of the educated public at large:.. One year later, when the Licensing Act was again being considered, Locke drafted a formal Memorandum for Clarke in which he repeated his objection to the guild’s monopolies in the Latin classics and argued that copyrights in contemporary authors should also be limited in term.” (M. Rose 2004, 78)
[K] HHC: That the Statute of Queen Anne, the first modern copyright act, was primarily a trade regulation bill is supported by the three facts:
“First, a part deleted from the original draft of the 1710 statute clearly emphasized that authors were to be given priority over others with respect to copyright. Parliamentary records reveal that this particular part was removed under pressure from monopolistic booksellers…
Second, there is the similarity between the Statute of Monopoly of 1623 and the 1710 statute. The Statute of Monopoly was, needless to say, intended to abolish the monopolies so rampant during the Elizabethan age. It allowed 21-year monopolies for existing privileges granted without
163
specific terms and 14-year monopolies for forthcoming inventions. The structure of the statute is similar to the first section of the 1710 statute…
Third, there are the claims made by intellectuals around 1710. The Licensing Act of 1662, which gave legal authority to the monopoly in the book trade, was repealed in 1695. John Locke contributed much towards its repeal, writing to peers in the House of Lords and strongly condemning the restrictions on science caused by the provisions of the Act and the monopolies of Stationers Company.” (Shirata 2000)
[L] “The court of King's Bench, the highest court of the common law, divided on the question, the majority supporting Lord Mansfield, who went to the furthest possible extreme in his identification of the right of exclusive copying and selling the copies of one's manuscript with the right of exclusive holding and selling physical things and their products… copyright … like the ownership of physical objects, the perpetual property of the author, his heirs and assigns forever. This outcome Mansfield expressly contemplated, saying, “property of the copy thus narrowed (i.e. defined as a common-law right] may equally go down from generation to generation, and possibly continue forever.” This conclusion was vigorously protested by Justice Yates, the only dissenting justice, saying, “This claim of a perpetual monopoly is by no means warranted by the general principles of property.” (Commons 1924: 275)
[M] “The most significant point about Donaldson is that it was a compromise, i.e., a political, decision. The Lords, by holding that the common law was the source of the author's copyright prior to publication, appeared to give the author a victory. But the common-law copyright, being only the right of first publication, was no copyright at all since it did not entail the exclusive right of continued publication. The common-law copyright concept, however, proved to be very useful to those claiming that the natural law was the source of the statutory copyright. Their argument was that the common-law copyright, clearly a product of natural law, was the source of the statutory copyright and therefore that the statutory copyright was merely the securing of a natural-law right. Thus, the harm of the Donaldson ruling was that it laid the groundwork for the future enhancement of the copyright monopoly on the basis of the natural-law-
166
property theory. In a sense, the booksellers, while losing the battle, won the war for their successors.” (Patterson 1993)
[N] “The most compelling advantage of encouraging copyright industries to work out the details of the copyright law among themselves, before passing the finished product on to a compliant Congress for enactment, has been that it produced copyright laws that the relevant players could live with, because they wrote them. If we intend the law to apply to individual end users’ everyday interaction with copyrighted material, however, we will need to take a different approach. Direct negotiation among industry representatives and a few hundred million end-users would be unwieldy (even by copyright legislation standards). Imposing the choices of the current stakeholders on a few hundred million individuals is unlikely to result in rules that the new majority of relevant players find workable. They will not, after all, have written them. There are, moreover, few signs that the entities proposing statutory revision have taken the public’s interests very seriously. Instead, they seem determined to see their proposals enacted before they can be the subject of serious public debate.” (Litman 1996).
167
The Competitiveness of Nations
in a Global Knowledge-Based Economy