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Intellectual Property

Introduction
Intellectual Property: useful information or
knowledge
Artistic property
Artistic, literary and musical works

Industrial property
Inventions and trademarks

Created by national law (and some regional law)


International law sets guidelines for uniform definition
and protection
Sets ways to make it easier for owners to acquire rights
in different countries

Creation * Protection * Transfer

Creation of Intellectual Property


Rights
Copyrights
An incorporeal statutory right gives
author of an artistic work, for a limited
time, exclusive privilege of making copies
of the work, publishing, selling copies
Pecuniary rights right to make money
from works
Reproduction rights
Distribution rights

Creation of IP Rights (contd)


Copyrights (contd)
Doctrine of exhaustion
Once a copy is circulated, author has no control
further right
i.e. purchaser can sell work

Right of performance
Right to communicate the work to the public by
any means whatsoever, including public recitation,
lyrical performance, public presentation, public
projection and telecommunication.
Note on subsidiary rights (Germany)

Public versus private - see p. 456 for examples

Creation of IP Rights (contd)


Copyrights (contd)
Moral rights (not US & UK)
Right of author to prohibit others from
tampering with work
Right to object to distortion, mutilation or
modification
Right to be recognized as the author
Right to control public access to work
(right to correct or retract a work) not so universal

Creation of IP Rights (contd)


Copyrights (contd)
Works Covered
Ex: US Copyright Act (7 categories)
1) Literary works, 2) musical works, 3) dramatic works, 4)
pantomimes/choreography, 5) pictorial/graphic/sculpture,
6) motion pictures/AV works, 7) sound recordings

Must be original
Creative effort invested by author in raw materials that
gives them a new quality or character

Idea or knowledge contained in work NOT protected


Only the expression of the work
NOT: ideas, procedures, methods of operation, or
mathematical concepts

Creation of IP Rights (contd)


Copyrights (contd)
Neighboring rights (similar, but distinctly
different)
Computer programs, semi-conductor chips

Formalities
Berne Convention: subject to no formalities

Scope
Only within scope of territory granting it

Duration
50 years post mortem (some jurisdictions 70
years)

Creation of IP Rights (contd)


Copyrights (contd)
Exceptions
In a court/administrative proceeding or police
(photo)
Instructional purposes in school
Purely private use (except computer programs)
Brief quotations in scholarly or literary works or
reviews
Extended quotations of newsworthy speeches or
political commentaries
Fair Use

Creation of IP Rights (contd)


Patents
A statutory privilege granted by
government to inventors (and licensed)
for a fixed period of years to exclude
others from manufacturing, using, selling
a product
Or from utilizing a patented method or process
Owner may be excluded from exercising
monopoly right - national security,
contractual agreement

Creation of IP Rights (contd)


Patents contd
Reasoning
Patents are confirmation of private property
rights of an inventor
Encourages invention and industrial
development

Creation of IP Rights (contd)


Patents contd
Patents and Other Inventors Grants see p. 467

Design patent
Plant patents
Utility patents
(petty patents)

Inventions new, involve an inventive step, and


are capable of industrial application
1) new
2) inventive step see case 9-3
3) capable of industrial application (commerce)

Creation of IP Rights (contd)


Patents contd
Determining Qualifications example
Review of application (see exhibit 9-1)

Inventions Excluded from Patent Protection


Not new, innovative step, industrial application
And violate social policies
to protect public order or morality
Protect the lives or health of humans, animals, or plants or to
protect the environment from serious injury

TRIPS
1) diagnostic/therapeutic/surgical methods 2) plants/animals
(except microorganisms) 3) essentially biological processes
for the production of plants/animals

Creation of IP Rights (contd)


Patents contd
Duration of Patents
TRIPS minimum of 20 years for WTO states

Scope of Patents
Only valid in territory of the state granting it

Creation of IP Rights (contd)


Trademarks (trademark, trade name, service mark,
collective mark, certification mark)
True trademark
Any word, name, symbol or device or any combination thereof
adopted and used by a manufacturer to identify his goods and
distinguish them from those manufactured or sold by others

Trade name name of manufacturer, not product


iPhone versus Apple

Service mark
Mark used in the sale of advertising of services to identify the
services of one person and distinguish them from another
KFC (Yum Brands) trademark and service mark
Coca Cola tradename and trademark

Creation of IP Rights (contd)


Trademarks (contd)
Collective mark used by a group to
identify itself to members (boy scouts,
greeks)
Certification mark used by licensee or
franchise to indicate product meets a
certain standard

Creation of IP Rights (contd)


Trademarks (contd)
Acquiring trademarks
By use
By registration

Registration
Public notification of other potential users of ones
claim to the mark

Registration criteria
Not infringe on another mark
Be distinctive
Possessing a unique design that distinguishes a product
from other similar products

Creation of IP Rights (contd)


Trademarks (contd)
Refusing registration see list on pp 481,
482
Resembles an existing mark, to cause
confusion/mistake/deceive
Deceptive/deceptively misdescriptive of
goods/services

Registration Review
Publication
Time to oppose (30-90 days)
If no opposition, registration issued

Creation of IP Rights (contd)


Trademarks (contd)
Term of Registered Trademarks
TRIPS, WTO minimum 7 years, indefinitely
renewable

Usage requirements
Many jurisdictions require usage of mark

Creation of IP Rights (contd)


Know-how
Practical expertise acquired from study,
training, and experience
If specific information, know-how kept secret
often called trade secrets

TRIPS/WTO must protect undisclosed


information
1) be secret
2) have commercial value because it is secret
3) must have been reasonably protected from
disclosure by its owner

International Intellectual Property


Organizations
World Intellectual Property
Organization (WIPO)
Specialized agency of UN
Administers Paris and Berne
Conventions
Promotes IPRs
Facilitates IPRs to/among developing
countries
ADR

International IPOs (Contd)


Council for Trade-Related Aspects of
Intellectual Property Rights (Council
for TRIPs)
Oversees operation of TRIPs
Monitors WTO members for compliance
Facilitates communication between
members
Assists in dispute settlement

Intellectual Property Treaties


States may enter into bilateral and
multilateral treaties with one another
Generally must grant more rights than
existing conventions (see Berne, p. 485)

Intellectual Property Treaties


(Contd)
Comprehensive Agreements
TRIPs
Create a multilateral, comprehensive set of rights and
obligations
1) WTO members must observe existing treaties (see
list on p. 486) (Paris, Berne, Rome, IPIC)
2) fills in gaps of the treaties (i.e. life of a patent)
3) sets criteria for effective and appropriate
enforcement
4) allows for transitional adoption (developing nations)
5) extends basic principals of GATT to IPR
National treatment, transparency, most-favored nation status

Intellectual Property Treaties


(Contd)
Artistic Property Agreements
Berne Convention see exhibit 9-2
Establishes common minimum rules to protect
the pecuniary rights of authors without requiring
them to comply with particular formalities
National treatment
Nonconditional protection
Country of origin protection (regardless of
nationality of author
Common rules principle uniform adoption by
members

Intellectual Property Treaties


(Contd)
Artistic Property Agreements contd
Rome Convention
Prohibits unauthorized: recording of live
performances, reproduction,
recording/rebroadcasting

Phonogram Piracy Convention


Satellite Transmission Convention
WIPO Copyright Treaty
Extends Berne to computer programs and
databases

Intellectual Property Treaties


(Contd)
Industrial Property Agreements
Paris Convention
National treatment
Right of priority
Grace period of 12 months to file in other state, treated
as same day as original filing

Common rules
May not deny protection because it originates from
another state
Must protect trade names without registration
Must outlaw false labeling
Must take effective measures to prevent unfair
competition

Intellectual Property Treaties


(Contd)
Industrial Property Agreements
contd
Washington Treaty
Treaty on Intellectual Property in Respect of
Integrated Circuits
National treatment, common rules (illegal copies,
importation)

Patent Cooperation Treaty


Single patent application

Intellectual Property Treaties


(Contd)
Industrial Property Agreements
contd
Madrid Agreement
Madrid Agreement for the Repression of
False or Deceptive Indications of Sources of
Goods
Importation / confiscation

Trademark Law Treaty


Common minimum rules
10 years for trademark

International Transfer of Intellectual


Property
Five ways to transfer from country to
country
1) exercise rights abroad
2) transfer or assign to another
3) license another
4) establish a franchise
5) government may grant a compulsory
license

Contractual in nature, business form

International Transfer of IP (Contd)

License
Franchise
Distributorship
Chain-style distributorship
Manufacturing or processing plant

Licensing Regulations
Grants of patents, trademarks and copyright
create monopolies
Strictly controlled, often special laws for it
Limited to what is granted by
contract/license
Rule of Reason
Courts must consider the overall impact of the
particular agreement on competition in relevant
market
Weighing the pro-competitive verses the anticompetitiveness

Licensing Regulations
(Contd)
Grants of patents, trademarks and copyright
create monopolies
Strictly controlled, often special laws for it
Limited to what is granted by
contract/license
Rule of Reason
Courts must consider the overall impact of the
particular agreement on competition in relevant
market
Weighing the pro-competitive verses the anticompetitiveness

Licensing Regulations
(Contd)
Territorial Restrictions
Exhaustion of rights doctrine
Once a good made or sold under license is in
circulation, the licensor has no further right to control
its distribution (see earlier)
See Terrapin v Terranova, and Centrafarm v Sterling
Drug

Common origin doctrine


Owners of the same IP who acquired it from the
same predecessor cannot restrict each other
from using the right.
Van Zuylyen case p. 500

Licensing Regulations
(Contd)
NB:
Primary purpose of a trademark is to
assure consumers of the place of origin
i.e. chocopie
Primary purpose of patent/copyright is
to reward creativity

Licensing Regulations
(Contd)
Export Restrictions
Restrict, entirely or partially, right to
export goods from territory where licensee
or production facilities are located
Most countries prohibit export
Some limit, to exports where:
Licensor owns IPRs and local laws allow
licensor to restrict imports

OR, licensor is manufacturer/distributor or


licensor has exclusive license to 3rd party

Licensing Regulations
(Contd)
Export Restrictions (contd)
Horizontal competition agreement
Division of industry on a global/regional
scale
US: per se violation of Sherman Act

Vertical competition agreement


Between seller and buyer
Not per se violations, rule of reason test

Licensing Regulations
(Contd)
Cartels
Combination of independent business firms organized to
regulate the production, pricing and marketing of goods
by its members
Cross-licensing agreements
Patent pool
Multiple licensing agreement
Bottle neck principle: participants in an industry wide
patent pool must grant reasonable access to the pool to
any firm wishing to compete so that no firm will be
disadvantaged
See shared licensing in mobile phone technology, Apple,
Samsung

Licensing Regulations
(Contd)
Exclusive licensing
Restricts who may compete with the
license
Sole rights
Exclusive rights
Nonexclusive rights

Licensing Regulations
(Contd)
Sales and distribution arrangements
Several approaches
Prohibits any interference by the licensor in
the licensees distribution system
Prohibits only those provisions that give
licensor exclusive distribution rights
Prohibit exclusive sales arrangements that
tend to allocate or monopolize the market

Licensing Regulations
(Contd)
Price fixing
Requires licensee to sell products at a
price set by licensor
Most countries prohibit all forms of price
fixing

Licensing Regulations
(Contd)
Noncompetition clause
Forbidding a licensee from competing
with the licensor
Most countries prohibited
Some exceptional circumstances

Licensing Regulations
(Contd)
Challenges to validity
Provisions forbidding a licensee from
challenging the validity of a licensors
claim to a particular statutory right.

Tying clauses
Provision requiring a licensee to acquire
or use, apart from the technology wanted,
goods or personnel designated by licensor
Illegal in most countries

Licensing Regulations
(Contd)
Quantity Restrictions
Field of Use Restrictions

Licensing Regulations
(Contd)
Restrictions on research and
development
Quality controls

Licensing Regulations
(Contd)
Grant Back Provisions
Restrictions that apply after the
expiration of IPR
See exhibit 9-3, p. 511

Licensing Regulations
(Contd)
Package licensing

Licensing Regulations
(Contd)
Restrictions that apply after the
expiration of the licensing agreement
Noncompetition agreements must be
reasonable
1)
2)
3)

2) tier of countries
3) tier of countries
See p. 512

Compulsory Licenses
Patents
See p. 513
See case 9-2, AIDS drugs

Compulsory Licenses
(Contd)
Copyrights
Statutory copyright license
Compulsory copyright license

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