Property, Liberty, and the Law

Ryan Bradley & Mike Quirk LJST 24

May 10, 2004 Professor Delaney

“Protecting Intellectual Property through Patents”

Property is one of the ultimate indicators of wealth in our society. Property laws help everyone, even the property less. Order through property laws allow the people to be engaged in the free market economy with little fear of losing everything they have because someone bigger and stronger took it from them. Property laws prevent societal chaos. Property covers a wide array of “things,” from pencils and televisions to yachts and buildings, it even includes ideas. Almost everything has an owner, from a tree branch overhanging a country road per Heckert v. Patrick to the design of a back massager. Intellectual property is the category of property consisting of these intangible things, patents, copyrights, and trademarks. What we plan to do in this paper is to depict the history of patent law, and illustrate the morality issues behind patents and to determine their effect on society.

The notion of establishing a way of protecting ideas through patents is an old one. The first documented patent was given in 1421, in Florence, Italy. North America’s first patent was “given by the Massachusetts General Court to Samuel Winslow for a new means of processing salt,” while “the first machinery patent was granted in 1646 to

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Joseph Jenkes for devising a mill for manufacturing scythes.” Without the incentive for personal gain provided by patents, we would live in a very different world. Patents create

protection for the inventor in that they create a low “stress” environment for innovation and production.

Mark Twain once said, “A country without a patent office and good patent laws was just a crab and couldn’t travel anyway but sideways or backwards.” What Twain

meant was that a country could not expect to move forward technologically unless there are sufficient rules protecting invention and innovation, especially in a free market economy. Property laws are only as good as the government that supports them, meaning that patents are only effective if the government which establishes these laws vows to uphold them with all of their power. Therefore, we can not look at American patent law without looking at the government which has promised to protect it.

According to Article I, Section 8 of the US Constitution, one of Congress’ duties is “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.” US patent law has a long history, dating back to 1790. The original patent law was a primitive one, but we see the importance of this idea simply through the fact that the framers of the Constitution would think to include such a clause. The original law was repealed in 1793, under the direction of then-Secretary of State, Thomas Jefferson. The new law granted patents to the inventor who exhibited a “new and useful art, machine,

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manufacture or composition of matter and any new and useful improvement on any art, machine, manufacture or composition of matter.” Even in its American infancy, patent law has always been important, important enough to be revised three years after its inception.

To quote the Patent and Trademark Office website, “A U.S. patent for an invention is the grant of a property right to the inventor(s), issued by the United States Patent and Trademark Office. The right conferred by the patent grant is, in the language of the statute and of the grant itself, ‘the right to exclude others from making, using, offering for sale, or selling’ the invention in the United States or ‘importing’ the invention into the United States.” Without a central governing body, patents could be granted to multiple inventors or authors. The United States Patent and Trademark office is only one of the numerous patent governing bodies in the world. The International Patent Institution, started in 1949 and based in Geneva, Switzerland, researches patents to make sure that duplicate patents are not issued. Carol Rose writes, “the more important a given kind of thing becomes for us, the more likely we are to have these hard-edged [, or crystalline,] rules to manage it.” So the importance that our society places upon property demands that we have laws to protect it.

Property comes in many forms, a parcel of land, a car, a pocketknife, even an idea. Patents are important because they allow individual citizen’s a tremendous amount

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of power over their ideas, especially if they turn into useful inventions. Our society would be very different if we did not have patent laws as innovation might stagnate. Ideas could be “stolen”, or taken without compensation being given to the owner. There would be little incentive to create new technologies because the inventor would end up losing all of his hard work unless he could hide it from society until he was ready to release a working model into the public market. But if inventor’s had to hide their work from society, what would be the point of innovative technology? Dictionary.com defines technology in terms of Anthropology as “The body of knowledge available to a society that is of use in fashioning implements, practicing manual arts and skills, and extracting or collecting materials.” Technology is supposed to help society, to make daily life

easier. Without patent law, the research of technology would slow, thus slowing the pace of daily life. But with patents being granted and ideas being protected, there is the rapid development of technology and science. But even then, there would be nothing to stop someone else from taking this intellectual property and using it for personal gain for

themselves. Just as stealing a bicycle is wrong, stealing someone else’s idea is wrong. Just as in every other kind of law, there is not always a clear cut answer, there are extenuating circumstances that cloud the issue. Intellectual property rights are full of the “mud” that Carol Rose writes about, “At the root of these economic analyses lies the perception that it costs something to establish clear entitlements to things, and we don’t bother to undertake the task of removing goods from an ownerless ‘commons’ unless it is

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profitable to do so.” What she is saying, is that people will put time and effort into their property only if they have a guarantee that the work that they have put into something is recognized and protected by the government. But like all law, there are some politics

involved. In the decision for State v. Shack we see that the state claims partial ownership of all property by way of regulations. So by patenting something, the inventor promises to play by the government’s rules regarding development of the new idea or invention.

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This is a preview of the whole essay

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Given the importance that we, as members of an industrialized society, based on free market economic competition, bestow on property, we see the need for the protection

of property. The Declaration of Independence reads, “We hold these truths to be self-evident: That all men are created equal; that they are endowed by their creator with certain unalienable rights; that among these are life, liberty, and the pursuit of happiness.” It is rumored that the line, “the pursuit of happiness” was at first written as, “the pursuit of property.” This editing is important to the origins of American property law. The fact

that the Founding Fathers would first write “the pursuit of property” speaks volumes to the importance of property in our society. After all, discontentment with the property rules that the King of England was enforcing upon the colonists is what made them break away from the empire. “No taxation without representation,” was the battle cry as

patriots dumped English-bought tea into Boston Harbor. The pursuit of property sounds very selfish when taken alone, but when understood in terms of a free market economy,

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and with the anti-trust and anti-monopoly laws on the books, it is a completely feasible reading of the Declaration of Independence. To further illustrate the importance of property rights, we must look at the Fifth Amendment of the Constitution of the United States of America. The Fifth Amendment protects the individual from public seizure of private property, it reads, “No person shall be…deprived of life, liberty, or property

without due process of law; nor shall private property be taken for public use, without just compensation.”

There are several ways to protect ones intellectual property; the types of patents to apply for are the utility, the design, and the plant patents. There are also trademarks, copyrights, and trade secrets. To get a U.S. patent, an application must be filed with the United States Patent and Trademark Office. Conflicting sources say a patent is unrestricted for seventeen to twenty years from the date of filing, meaning that an inventor has seventeen to twenty years to market his technology or art before the patent expires and it becomes part of the common knowledge and therefore a part of the public usage. The United States Patent and Trademark Office allows the inventor to profit from his work, ensuring that no one can steal, or use his idea, without reimbursement of some kind. We have already established the need for protection of property, but it needs to be reiterated in the context of a professional opinion. Rose once again contributes her thoughts. “‘First in time, first in right’ may work well enough in a community where everyone knows all about everyone’s else’s transactions, but outside that context, the

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doctrine does little to put people on notice of who owns what, and the opportunities for conflicting claims are endless.” What we can obtain from this quote is the fact that the United States Patent and Trademark Office, along with the International Patent Institution, exist in order to insure that no toes are stepped on in terms of people using someone else’s property, be it a design for a new hair dryer or a cure for cancer.

Now that we have established the importance of protecting intellectual property rights, we must look at the ethics behind property law. If society would grant an inventor the freedom to innovate and improve existing technologies, there is a certain expectation, on the part of society, to see a return on its investment. In the field of medicine for instance, if a corporation was granted a patent for a cure for cancer, there would be an obligation to society, on the part of the corporation, to release an affordable medication in a short period of time. Society grants these property rights in the form of patents because technology needs to advance at a constant pace, in order to keep up with the demands of our lifestyles. The corporation has an obligation to return to society that which it has been given: the right to new information and technology. There will always be debate about the ethical aspect behind property because property can be used as a sword and a shield. If a company like IBM, which owns “about 23,000 active U.S. patents, with more being added every week,” wanted to cripple their competition, they could buy up all the

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patents on the market. In this case, the act of buying the patents for your own use would be an act of property being used as a shield. On the other hand, buying up all the patents and placing them on a shelf for twenty years, just so the competition could not use them would be property acting as a sword for the owner. This approach to business is completely square and legal, but is it right? Justice Weintraub in the State v. Shack decision provides us with this little gem, “A man’s right in his real property is not absolute. It was a maxim of the common law that one should so use his property as not to injure the rights of others.” An example of using property to injure others would be our cure for cancer scenario, or an IBM-like company buying all the patents it could. This would include any owner withholding information that could be of use to society.

In article one section eight of the Constitution of the United States of America, it states that the constitution will attempt “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.” With this statement come moral dilemmas. When the constitution was written the idea of biotechnology and patenting different kind of wheat genes and genetically modified rice did not exist. Thus with the advancements in biotechnology there have been questions and concerns regarding protection of intellectual property rights and the moral burden over the use of these new developments. This can be seen in an article written by Harold C Wegner, former Professor of Law and Director of the Intellectual Property Law Program at George Washington University Law School.

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Wegner comments on his article that “The challenging facing society is advancing agricultural science without jeopardizing intellectual property rights and herby guaranteeing greater food security for emerging economies.” Numerous countries around the world are faced with poverty and food shortages everyday, but with some new advances in biotechnology hunger could be cut down on dramatically. For example, there is a wheat gene called Norin 10 which has helped India and Pakistan increase their wheat producing by sixty percent, and Costa Rican scientists have worked on a genetically altered rice which will help all rice growing countries. AS technology grows scientists are getting closer and closer to producing plants with higher nutritional content, create their own pesticides and have a longer shelf life.

With all these great advances comes the greed and rights to these extremely valuable genes, and new patents. If a company patents these nutritional plants do they have the right to charge enormously large prices for them? The answer sadly is yes. Patent laws are so strict that the one who invents the idea or concept of these biotechnological breakthroughs owns them and can do as they please with them. Although there are millions of people starving everyday around the world, these companies or individuals can hold onto these ideas and never show anyone unless the price is right. The moral dilemma here is death defying. The individual investors and companies who own stock in these bio tech firms want to milk their breakthroughs for every penny and are allowed to do so. So, the next question is when should governments

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take over? And the answer is they can not, at least not in the United States. These patents could virtually end hunger and would give greater food security for emerging economies, but at the same time one must respect and honor these biotech firms’ right to intellectual property and their discoveries.

To create and test a new discovery in the bio tech field is extremely expensive and time consuming. Therefore, the stock holders and/or owners of the companies deserve to try to make a profit and charge exuberant prices for their discoveries. Although this might seem trivial, the time and money put into testing is extremely important. If one were to take a new crop out into the world, seed it on various continents, and sell it world wide without knowing long term effects of the good could be deadly. The testing that goes along with these advances is well worth the time and effort. Also, without an international patent law or punishment there is no benefits or want for private investors to invest in this risky ordeal. This is because there is no stopping others countries form producing and stealing these new inventions once they go overseas and making profit on them themselves. In saying this, there needs to be new patent laws which encourage inventors, protect inventions, but provide access to all in need if the new invention will help better man kind.

Secondly, the ideas of what can be patented arise. If someone attempts to patent some plant, fish or new species it cannot be done. However, if one finds that the extract of juice within a certain fish’s eye can heal cancer than the extract may be patented. The

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maybe within the last statement is because the only way the extract can be patented is if the inventors modify it and or work with it in some way to create a drug, food, or something new. On the other hand not being able to patent things such as a new species or an extract can create other moral dilemmas. Such as, keeping the discovery form the world, so an individual firm can concentrate on its discovery and find out what can and cannot be done with it. I fully agree with this. One should be able to name a new species but may not be able to patent it. If this was true wouldn’t we be able to patent our son or daughter? They are technically new to the world, and have a different set of genes than anyone else. When put into this light, one can see how living things, and natural things can morally not be patented.

Also, who owns patents? If one works for a certain company and creates a product usually the patent goes to the company rather that the inventor itself. Also, patents that are claimed in the United States are protected by patent laws discussed earlier, but there is seemingly no stopping overseas markets form taking the advancements. But realistically there are, not all countries have the same buying and producing power as the U.S.. Thus bringing in the idea of whether or not this information should be freely distributed to the wealthiest countries that in turn produce the product and evenly distribute the product to underprivileged countries. This idea although ideal will, in my eyes, never happen. If the world cannot even stop war, how are various countries going to give up their money and factories freely to better underprivileged

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countries. Do not get me wrong, I would love to see this happen, where countries never have to worry about hunger, but realistically there is no incentive for producing powerhouses such as the United States, England, Brazil, and Japan to follow this plan and help hungry nations.

As the bio tech advances increase, there is more need and incentive for implementation of patent laws and regulations into various countries. China and Brazil have recently adopted patent systems to stimulate innovation. If other countries could take this stand, and protect their inventors maybe there will be more technological advances in these hungry nations, and the moral dilemmas of sharing and using other nations’ money and man power will be eliminated.

In the Supreme Court case of Diamond, the commissioner of patents, v. Chakrabarty in 1980, Chakrabarty filed suit against Diamond and the board of patents because Diamond denied the plaintive a patent to a human made genetically engineered bacterium capable of breaking down crude oil, a property which is not possessed by any naturally living bacterium. The reason Diamond denied the patent is because the Patent Board of Appeals said that the living things are not patentable subject matter. Then the Court of customs and Patent Appeals reversed saying that micro-organisms are alive and the fact that they are alive has no legal significance for purposes of patent law. This argument is very discerning in the fact how can one own another living thing? For example, one does not own their cat or dog, yes they might buy the cat, dog or any

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animal, but they adopt them into their family like another child. Although congress wanted to broaden patent laws’ scope, “laws of nature, physical phenomena and abstract ideas are not patentable.” The plaintive however is saying that this phenomena is “not natural and is manufactured and is a composition of matter—a product of human ingenuity having a distinctive name, character, and use,” which was decided in the Hartranft v. Wiegmann case. This seems absurd in the fact that as long as something is manufactured, not natural, is thought of by humans’, has a distinct name, use and character that it can be patented. Does this mean that the day someone is cloned that because they are not natural they can be patented and belong to another human being? The being will have a use, a character and a name, so sooner or later the court is going to have to make a decision, and amend something to the constitution regarding human beings. The Plant patent act of 1930, does stop people from patenting plants which do not reproduce asexually, and then the Plant Variety Act which started to protect other forms of plants, but never touched on bacteria or other living things.

Besides bio technical patent cases there are cases involving tools as simple as pliers. For example, in the recent case of Intirtool, Ltd. V. Texas Corp, Intirtool patent was found invalid due to the fact that the description they filed in their patent paperwork was not up to standards and did not cover every aspect of the pliers, and Intirtool still sold the tools to Texas Corp. even though they did not do everything they were intended to do. Texas Corp. continued to sell this product and eventually had to bring it to court. At each

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court level the court found that Intirtool violated patent description laws. Intirtool simply tried to get around the decision by claiming that the court was misinterpreting the description and stating that “punching and connecting” are just “benefits and features” which should not need to be included in patent descriptions. Also, the courts prosecuted Intirtool with attempting to mislead the patent examiner by not having the actual product match up with the drawing of the patent. Secondly, Intirtool had to award Texas Corp. with compensation because Texas Corp. was promoting and selling goods which did not work properly, thus hurting Texas corp.’s image. This case is an example of Intellectual property being falsely patented. The company drew and described on product but sold a completely different one. Thus not producing and selling the good that they patented, and breaking patent regulations.

Business ethics and patents for new technology or goods usually go hand in hand. Spin-off companies are companies who simply feed off of others ideas. They wait for companies to come out with new products and then attempt to change these products slightly and patent them for themselves. One of these companies is the European company CropDesign, who carry a highly qualified team of patent law specialists and patent writers. The reason for such a high pay roll for patents is that, patents are a very large investment where one may apply for a patent but not even wreak the benefits for seven to ten years afterwards. The second reason for this patent team is that there are hundreds of companies just like CropDesign around the world, and having one of these

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other companies file a patent application before them it could cost the business possibly hundreds of thousands of dollars and the individual writing the report his/her job. Since CropDesign is a European company they face different Patent rules and laws. For example, the European patent system takes between seven to ten years while the United States Patent system can be granted within three years. European patent markets usually question the United States’ method. They believe the United States patent examiners are under extraordinary pressure to pass these patents and believe the examiners narrow their scope and sometimes the patent’s value can become questionable due to the fast pace process. Some of these mistakes come up from time to time, in the news, tabloids, or friendly emails. One such mistake was reported in a European online newspaper article by David Becker, CNET, with a playful spirit with the first line reading “Apparently, intellectual property does grow on trees.” A mistake at the patent office had switched up one of Microsoft’s patents with a Mr. Robert Burchinal. Mr. Burchinal was attempting to patent an apple tree found in the early 1990’s in the Wenatchee region of Washington, which he cleverly dubbed “Burchinal Red Delicious.” Somewhere within the process of the patent forms Microsoft’s and Burchinal’s names got mixed up and Microsoft was the proud new patentee of a lovely breed of apple tree. If Microsoft had not so graciously signed the patent over to its rightful owner, it would have been the first biological patent by this patenting giant.

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When it comes to patenting anything and everything no one on the earth does it better than Bill Gates and his patenting team at Microsoft. Microsoft has patents for everything from computer chips to how its video games store data. Even though Microsoft usually follows the patenting laws, they usually use some force and money to capture a lot of their patents. Notorious for buying out competition to be the largest computer program producer in the world, Bill Gates and his rather massive wallet have made an appearance of the Simpsons to buy out Homer’s internet service which doesn’t even work. Although that particular episode poked fun at Bill Gates, he has been having some rather rough times as of late.

On April 13th 2004 it was announced that Microsoft would settle for 440 million dollars after a long standing court case which dealt with InterTrust Technologies. This three year old patent infringement suit attacked everything from Windows to all of Microsoft’s multimedia software. Most patent infringement cases go on until the court makes a final decision, but watching Microsoft works shows how patents truly do create monopolies. InterTrust could have won the case had they stuck it out, but like most companies they bow down to millions of dollars. One very large debate comes out of the numerous patent cases involving this computer giant, is Microsoft insecure with its own technology that they must get rid of any competition. As my paper discusses earlier, one of the main reasons we need world wide patent laws is because we want individuals to invent, think, and come up with new and exciting ideas. Ironically this idea plays both

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ways. On the one hand there are poor starving countries, which cannot feed its own people never mind have patent laws to protect the few highly educated and brilliant mind who live there, and on the other hand the multi-billion dollar corporations of America. Both ends of the spectrum need to be toyed with. The prospering nations such as the United States, Brazil, England, and Japan must come together to make a singular world wide protection agency which enforces every country. This organization could possibly just adopt one of the already successful patent organizations and add to it. As simple as it may seem this is very difficult, and even if one did exist there is no way to stop Monopolists such as Bill Gates because it would be hindering the American Dream, to live life to the fullest and do what one wants to do. Just because one man turned one computer into an empire doesn’t mean that we can banish him and not allow him to continue to enlarge his already vast empire. As much as one might want to see some other companies come out with fun new exciting programs as long as people are still greedy and attracted to money we may never see some of the most brilliant ideas in Computer technology. Where is Mr. Gates’ limit? In another recent case including Microsoft and Sun Microsystems, Microsoft bought patents and rights to almost all of Sun Microsystems work for two billion dollars. Microsoft was faced with charges of patent infringement and technology theft, so instead of playing out the court hearing and possibly doing time for one’s crime Mr. Gates simply took out his get out of jail free

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cards, or checkbook, and almost doubled his number of programs and features which include media and visual programs.

All this money and court cases might seem cruel, but sometimes companies who have been bought out put their new found riches to good use. The owners of InterTrust, instead of closing their company and walking away with their cool 440 million, the executive board decided to put it back into the company by buying new facilities giving raises to inventors and all around just giving incentive to better our technological databases. These are the type of companies and owners which should be involved in every company.

Another such company is Merck, which is a major international pharmaceutical company. A few years ago Merck fumbled upon a cure for African River Blindness, and unlike the earlier biotech companies discussed earlier, Merck went ahead and produced and distributed the product with no one subsidizing them. Merck is very aware and active in knowing what patent laws could be infringed, but saw that their product was needed and they stepped up to the plate. Merck’s product could have been gobbled up by various competitors as I’m sure it did, but realized that if they had waited for the patent thousands would have most certainly died.

As I searched through thousands of web pages for this paper, I came upon one very interesting one with a section entitled “Perspective from Jewish Sources.” As it turns out, the Jewish faith has their own intellectual property law, in Hebrew ze neheneh veze

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chaser, or unjust enrichment. This is very similar to patent laws, but sees it more as a common law or a courtesy law. Stating that, “prevents ‘free riding’ by compelling someone to pay for a benefit he receives which cost money to the provider, even if the benefit is not sought. A person who makes commercial use of a creative work, an invention, a trade mark or a trade secret is benefiting from the expense and effort of the artist, inventor, or trademark owner.” This should be common law just as the Jewish faith sees it, but not all individuals have a faith or if they do read the materials for their faith. Religion could play a large role in intellectual property and common law, but possibly in another time when commandments actually mean something.

Property law in general is a complicated matter. Owners, as part of the system that protects their individual rights, must weigh the uses of their own property against the rights of the society in which they live. Patent law specifically, is heavily based upon this ethical dilemma. The owner of a patent subscribes to this notion of helping society eventually, and must fulfill this obligation in order for the system to perpetuate itself. There is a minute distinction between helping society and hurting society, based upon how the owner interacts with the system. A business powerhouse like IBM hurts the system if it uses its property rights as a sword, or just to cripple its competition. Large corporations have a larger responsibility than the small, garage inventor, but the obligation is still there: to help society in any way they can. Owners invest themselves in the system, so they must work to perpetuate it however they can. If this obligation cannot

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be fulfilled by the philanthropic inventor, then a body like the International Patent Institution needs to be more authoritative. This would most likely happen before inventors decided to manage their own obligations. Intellectual property rights are namely those ideas that would help mankind, so mankind should have some say in the matter, therefore making a powerful governing body a necessity.

Britannica Student Encyclopedia Online

Rose, Carol M. ”Crystals and Mud in Property Law”