PropertyProf Blog

Editor: Stephen Clowney
Univ. of Arkansas, Fayetteville

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Friday, December 18, 2009

Smith on Institutions and Indirectness in Intellectual Property

Henry E. Smith (Harvard) has posted Institutions and Indirectness in Intellectual Property on SSRN.  Here's the abstract:

Intellectual property rights are controversial because on first glance they present a disjunction between the purposes they serve and the mechanisms they employ. New Institutional Economics (NIE) suggests that for reasons of transaction costs, broadly conceived, institutions are imperfect and their imperfections may nonetheless be cost-effective. This Article draws on the NIE to present a theory of the similarities and differences between IP and regular property, and sharpens some empirical questions relating to the advisability of property-style IP protection. IP is characterized by two types of indirectness that need not both be present in regular property. In first-order indirectness, the resource to be measured is difficult to meter, leading to the use of rough proxies. Variation in outcomes along dimensions of the resource – for example, animals supported by grazing land – show high variance, i.e. risk. Second-order indirectness involves uncertainty or ambiguity about the return from a resource, in terms of how to employ it or even to carve it up – for example choosing crops or deciding between agricultural and residential subdivision. The greater the uncertainty, the more attractive, in terms of maximizing option value, it is to delegate decisions over these dimensions of resource activity to those close to the resource. Both types of indirectness point to advantages that in theory a modular structure of rights can provide: difficulty in measuring dimensions (first-order) or identifying the relevant dimensions (second-order) suggests that a given activity be placed within a module and control over local remodularization be given to private actors. Because information is nonrival, the benefits of modularity must be traded off against the benefits of exclusion costs. In both patent licensing and remedies, an NIE approach to property that does not emphasize information costs has difficulty explaining patent rights as opposed to other internalization and coordination devices. The Article applies the information-cost theory to IP licensing and patent remedies. Licensing implements a governance strategy that enriches the interface between IP rights in limited ways. Injunctive remedies dovetail with a modular structure of exclusion rights, and the traditional equitable approach to injunctions provides for targeted safety valves for problems relating to lack of notice and reasonable reliance by potential infringers.

Ben Barros

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December 18, 2009 in Intellectual Property, Property Theory, Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

Tuesday, September 29, 2009

Nelson on Virtual Property and the Rule of Capture

John William Nelson (Samford/East Anglia) has posted Fiber Optic Foxes: Virtual Objects and Virtual Worlds Through the Lens of Pierson V. Post and the Law of Capture on SSRN.  Here's the abstract:

Virtual worlds are more successfully blurring the lines between real and virtual. This tempts many to try and equate virtual property with tangible property. Such an equation creates problems when the common law of property is applied to virtual objects over which users can not possess complete dominion and control. The result is a conversion of the tangible resources that support virtual worlds into a virtual commons. Accordingly, the common law of contracts, rather than that of property, should be used to govern transactions between a user and owner of a virtual world.

Ben Barros

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September 29, 2009 in Intellectual Property, Personal Property, Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

Wednesday, September 23, 2009

Nelson on Virtual Property

John William Nelson (Samford/East Anglia) has posted The Virtual Property Problem: What Property Rights in Virtual Resources Might Look Like, How They Might Work, and Why They are a Bad Idea on SSRN.  Here's the abstract:

‘Virtual property’ is a solution looking for a problem. Arguments justifying ‘virtual property’ lie among three common themes - Lockean labor theory, theft protection and deterrence, and market efficiency. This paper goes beyond those who advocate for or against the creation of ‘virtual property.’ First, Locke’s labor theory is dismissed as a justification. Then, two models of what property rights may look like when applied to virtual resources are created. These models are then applied to six different virtual world scenarios in order to see the effects of ‘virtual property.’ Finally, the failure of property rights to benefit the users, developers, and virtual resources of virtual worlds is explained.

Ben Barros

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September 23, 2009 in Intellectual Property, Property Theory, Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

Wednesday, August 19, 2009

Mossoff on IP and the Administrative State

Adam Mossoff (George Mason) has posted The Use and Abuse of IP at the Birth of the Administrative State on SSRN.  Here's the abstract:

Courts and commentators have long maintained that intellectual property law and the administrative state developed as two separate legal regimes without any significant theoretical or practical contact between them, at least until recently. This standard historical story is mistaken. This article identifies a long-forgotten nexus between intellectual property law and the birth of the administrative state in the Progressive Era, and in doing so, offers at least two important insights. First, as a matter of intellectual history, it establishes that administrative law and modern intellectual property law share a common theoretical pedigree in legal realist scholarship about property in the Progressive Era. Second, and more important, this article exposes serious theoretical concerns about the success of this scholarship by Felix Cohen, Morris Cohen and others. In justifying the regulation of real property under the administrative state, the Cohens and others used intellectual property rights to advance a scathing conceptual and normative critique of the natural rights theory of property. This critique has now assumed the mantle of conventional wisdom in intellectual property law, as commentators and lawyers dismiss natural rights theory as theoretically incoherent and doctrinally indeterminate. But the legal realists’ attacked a strawman version of the natural rights theory of property, redefining its concept of “value” in unduly narrow economic terms such that it no longer resembled the same theory advanced by the natural rights philosophers or the American courts and commentators who applied their ideas in legal doctrine. This article explicates for the first time the actual premises of the legal realists’ critique of the natural rights theory of property, revealing how they failed to prove either the logical or normative incoherence of this longstanding conception of property. As such, this article exposes a fundamental lacuna in the theoretical foundations of the modern administrative state. Even more important, it challenges the misrepresentations and all-too-hasty dismissals of natural rights theory by intellectual property scholars today.

Ben Barros

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August 19, 2009 in Intellectual Property, Property Theory, Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

Thursday, July 9, 2009

Revive INS v. AP to Save Newspapers?

From an Op-Ed in the Cleveland Plain Dealer:

"If the copyright law doesn't open the way for originators of news to stop the free-riding, newspapers will die," he said. "No exceptions."

The Marburgers propose a change in federal law that would allow originators of news to exploit the commercial value of their product. Ideally, news originators' stories would be available only on their Web sites for the first 24 hours.

There is precedent for this change, David Marburger says. In 1918, the Associated Press sued International News Service for essentially the same problem now posed to newspapers by Web aggregators. INS was copying or rewriting AP stories and transmitting them by telegraph and telephone to papers in western U.S. time zones.

The Supreme Court ruled that INS engaged in unfair competition that ultimately would drive AP out of business. It enjoined INS from reproducing the AP stories, but only for a brief period while AP's dispatches had commercial value.

The court decision was diluted over time. In 1976, Congress further weakened the ruling with a new section in the copyright bill that didn't anticipate future problems of the Internet.

The Marburgers recommend amending the federal Copyright Act to provide two remedies for unjust enrichment:

• Aggregators would reimburse newspapers for ad revenues associated with their news reports.

• Injunctions would bar aggregators' profiting from newspapers' content for the first 24 hours after stories are posted.

Ben Barros

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July 9, 2009 in Intellectual Property | Permalink | Comments (0) | TrackBack (0)

Saturday, May 30, 2009

More on Conwell v. Grey Loon

Thanks Ben, for asking me to share my thoughts on Conwell v. Grey Loon Outdoor Marketing Group, Inc. While Eugene Volokh describes it as “not the sexy sort of cyberlaw, I get tired of teaching “sexy” cases dealing with Playboy and various porn sites. But seriously, cases like this one are great teaching tools for that first part of the Property course when students wonder why we spend so much time talking about whether rights are “property” rights or not. This case also demonstrates that judges and lawyers really need to talk to people in the technology world to find out exactly what a web site is.

The plaintiffs in Conwell hired Grey Loon to design and host a web site for them. Grey Loon did so, and sometime later the plaintiffs asked for modifications. After the defendant modified the web site, plaintiffs decided that they didn’t want the modified web site, but wanted the old one. Plaintiffs didn’t pay for the modifications, so Grey Loon disabled the modified web site, which it could do, because it was the web site host. The defendant did not keep a copy of the original web site, so plaintiffs were left without a web presence. Defendant claimed breach of contract and plaintiffs counter-claimed conversion, arguing that the defendant’s action in terminating access to the original web site constituted conversion of the plaintiff’s property.

Early in the opinion, it looks like the court is going to be sympathetic to the conversion claim. The opinion does a reasonable job of explaining the roles of web site designer and web site host. It also explains that the plaintiff could have used another web site host, and if it had done so, it would have had to acquire the files from Grey Loon and transfer them to the other host. Hmm, if these files had to be acquired and transferred, they must be rivalrous, right? Otherwise, couldn’t anyone just copy them?

The court’s discussion of the contract claim previews how it will go awry on the property rights issue. First, it discusses its choice of the common law of contracts over Article 2 of the Uniform Commercial Code. The court recognizes that some courts hold that mass-market software is a good, but it rejects those decisions, stating that courts that treat software as a good simply because it is contained in a tangible medium “conflate the sale of a book with the sale of its intellectual content.” Exactly wrong! A book is a good. I own plenty of books, but I don’t hold the copyright in any of them. Likewise, I am the “owner” (okay, okay, licensee, perhaps) of the copy of Word with which I am typing this. While I’m using it, no one else can. If someone removes it from my computer without my permission, I’ll be ticked off. But I don’t own the copyright in it, so I can’t make a bunch of copies of it and sell them. Does the court think that everything that is intangible is intellectual property?

Apparently so. In its conversion discussion, the court jumps right into copyright law, finding that the web site was not a work made for hire and that Grey Loon had not transferred its copyright to the plaintiffs. It then finds that the plaintiffs, who were conducting their business through their website, were merely nonexclusive licensees of that site! Simple, according to the court: the plaintiffs did not own the web site, therefore they could not sue for conversion. 

The concurrence touches upon, or more accurately brushes against, the law of conversion, recognizing that several courts have held that intangible assets, such as electronic data and internet domain names (the “sexiest” cyberlaw case of all) can be converted. As I have argued (shameless plug warning) elsewhere, these cases are not very useful because the courts tried hard to fit a specific asset into the law of conversion without discussing the main characteristic that should make an intangible asset the subject of a conversion action: its rivalrousness. Conversion is an action for the deprivation of possession of an asset; while intangible assets cannot be manually possessed, some of them, such as domain names, can be exclusively controlled.

Can a web site be exclusively controlled and therefore converted? It seems that the answer is “yes,” but I don’t know for sure. But the people involved in resolving these disputes really have to become more familiar with how emerging intangible assets are created, possessed and transferred in order to create law that will be useful to those dealing in such assets. 

Juliet Moringiello

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May 30, 2009 in Intellectual Property, Recent Cases | Permalink | Comments (3) | TrackBack (1)

Wednesday, May 13, 2009

Munzer and Raustiala on IP in Traditional Knowledge

Stephen R. Munzer and Kal Raustiala (UCLA) have posted The Uneasy Case for Intellectual Property Rights in Traditional Knowledge on SSRN.  Here's the abstract:

Should traditional knowledge - -the understanding or skill possessed by indigenous peoples pertaining to their culture and folklore and their use of native plants for medicinal purposes - receive protection as intellectual property? This Article examines nine major arguments from the moral, political and legal philosophy of property for intellectual property rights and contends that, as applied to traditional knowledge (TK), they justify at most a modest package of rights under domestic and international law. The arguments involve desert based on labor; firstness; stewardship; stability; moral right of the community; incentives to innovate; incentives to commercialize; unjust enrichment, misappropriation and restitution; and infringement and dilution. These arguments do, however, support “defensive” protection for TK: that is, halting the use of TK by nonindigenous actors in obtaining patents and copyrights. These arguments also support the dissemination of TK on the internet and via other digital media and the selective use of trademarks. The force of these conclusions resides in the importance of a vibrant public domain, and the absence of any plausible limiting principle that would allow more robust rights in TK for indigenous groups without permitting equally robust rights for nonindigenous groups.

Ben Barros

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May 13, 2009 in Intellectual Property, Recent Scholarship | Permalink | Comments (2) | TrackBack (0)

Wednesday, April 29, 2009

Mossoff on Patent Thickets at the VC

Adam Mossoff is blogging this week at the VC on his article on The Rise and Fall of the Sewing Machine Patent Thicket.  Very interesting stuff.

Ben Barros

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April 29, 2009 in Intellectual Property | Permalink | Comments (0) | TrackBack (0)

Monday, March 23, 2009

Moringiello on Virtual Worlds and Property Law

Juliet M. Moringiello (Widener) has posted What Virtual Worlds Can Do For Property Law on SSRN.  Here's the abstract:

This is an article about how disputes over virtual world items, such as virtual money, Second Life islands, and even "sex beds," can inform property law generally. Rights in these virtual world items, like rights in software and many other intangible assets, are transferred by standard-form agreements that are often designated as licenses. For many readers, virtual worlds need no definition; it has been hard to read a major newspaper in the past several years without encountering an article about virtual worlds. In the past several years, Second Life and other virtual worlds were featured in numerous articles in major American newspapers, including the New York Times, the Washington Post, and the Wall Street Journal.

Virtual worlds have captured the attention of legal and other scholars. The legal literature tends to focus on the application of "real world" laws to the virtual environment. Some have discussed how our property laws should apply in virtual worlds; others have questioned whether virtual worlds need their own governance institutions. In this article, I will take another approach. Rather than asking whether real world laws can or should apply to virtual worlds, I will discuss the ways in which the study of virtual worlds can contribute to real world law. Specifically, I will explain what the study of virtual world assets can do for property law.

In this paper, I argue that virtual world assets are significant because they graphically illustrate the different rights that persons can hold in an intangible asset. Once we see that intangible assets encompass the very same rights that are embodied in tangible assets, we can understand that the law should not permit the unfettered customization of property rights in intangible assets by standard form agreements, just as the law does not permit the unlimited customization of property rights in tangible assets and real property. My thesis is that a study of virtual world assets can help us understand why the numerus clausus principle should be more rigorously applied to rights in intangible assets and that the numerus clausus can, in turn, assist us interpreting the standard-form agreements that convey rights in these assets.

Ben Barros

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March 23, 2009 in Intellectual Property, Recent Scholarship | Permalink | Comments (1) | TrackBack (0)

Thursday, March 19, 2009

Miller on Copyright Originality

Joseph Scott Miller (Lewis & Clark) has posted Hoisting Originality on SSRN.  Here's the abstract:

Copyright's originality standard is ripe for reappraisal. Many have described how copyright exclusion claims now intrude into the everyday lives of ordinary folk - making an "infringement nation," coated in "billowing white goo." (Tehranian (2007); Litman (2008)). And many have proposed ways to cope with copyright's expansion, from strengthening the fair use privilege to trimming the derivative work right to modifying the basic "substantial similarity" infringement standard. A few have tackled the matter at the front end - putting, as it were, less goo in the billowing machine. (E.g., Hughes, Size Matters (2005); Sprigman, Reform(Aliz)ing (2004)). Virtually no one, however, has gone back to the source - copyright's originality standard. Feist, the phone book white pages case, tells us that, at least as a constitutional matter, "the requisite level of creativity is extremely low." 499 U.S. 340, 345 (1991). But the Copyright Act's statutory originality requirement can, and should, be more demanding. I pattern this exploration on patent law's rejuvenated nonobviousness requirement, which the Supreme Court's KSR decision (2007) grounds on incenting the unconventional and unexpected. We should put copyright's creativity requirement on the same footing, protecting expression in proportion to its unconventionality. Indeed, the conditions that justify a nonobviousness requirement for useful inventions - distilled to the wisdom that "[w]ith greater rights come more stringent requirements for obtaining the rights" (Duffy, Inventing Invention at 10 (2007)) - are strikingly similar to those that bear on creative expression. I also identify the critical wrong turn in Bleistein (1902), where Justice Holmes concluded that the alternative to a low creativity threshold was a stifling aesthetic orthodoxy policed by the judiciary. He was right to turn away from such orthodoxy, of course, but missed a third, and better way - rewarding, and thus encouraging, the heterodox itself. The progress at which we should aim, for copyright as much as for patent, is the new vista to which we're led by those who break through conventional boundaries.

Originality must be hot right now!

Ben Barros

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March 19, 2009 in Intellectual Property, Recent Scholarship | Permalink | Comments (1) | TrackBack (0)

Parchomovsky and Stein on Originality in Copyright Law

Gideon Parchomovsky (Penn) and Alex Stein (Yale/Cardozo) have posted Originality on SSRN.  Here's the abstract:

In this Essay we introduce a model of copyright law that calibrates authors' rights and liabilities to the level of originality in their works. We advocate this model as a substitute for the extant regime that unjustly and inefficiently grants equal protection to all works satisfying the "modicum of creativity" standard. Under our model, highly original works will receive enhanced protection and their authors will also be sheltered from suits by owners of preexisting works. Conversely, authors of less original works will receive diminished protection and incur greater exposure to copyright liability. We operationalize this proposal by designing separate rules for highly original works, for works exhibiting average originality, and for works that are minimally original or unoriginal. We illustrate our rules' application by showing how they could have altered court decisions in classic copyright cases in a socially beneficial way.

Gideon sure likes those one-word titles.

Ben Barros

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March 19, 2009 in Intellectual Property, Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

Mossoff on Patent Anticommons

Adam Mossoff (George Mason) has posted A Stitch in Time: The Rise and Fall of the Sewing Machine Patent Thicket on SSRN.  Here's the abstract:

Scholarly interest in how anticommons theory applies to patents has skyrocketed since Professor Michael Heller first proposed a decade ago that excessively fragmented interests in land can frustrate its commercial development. There is now a vigorous debate on whether anticommons exist in patent law, and, if so, whether these patent thickets impede innovation in patented products. As Professor Heller writes in his recently published book, The Gridlock Economy, "the empirical studies that prove - or disprove - our theory remain inconclusive."

This article contributes to this debate by analyzing the rise and fall of the first patent thicket in American history: the Sewing Machine War of the 1850s. The invention of the sewing machine in the antebellum era represents many firsts in the American legal system - the first patent thicket, the first "patent troll," and the first patent pool. Significantly, this case study verifies that patent thickets exist and that they can frustrate commercial development of new products. But it also challenges widely held assumptions in the patent thicket literature. Many scholars believe that this is largely a modern problem arising from a host of allegedly new issues in the patent system, such as incremental high-tech innovation, excessive litigation, and the rise of "patent trolls." Yet the sewing machine patent thicket exhibited all of these phenomena, revealing that patent thickets have long existed within the historically successful American patent system. The denouement of the sewing machine patent thicket in the Sewing Machine Combination of 1856, the first privately formed patent pool, further challenges the widely held belief that patent thickets are best solved through new statutes, regulations or court decisions that limit property rights in patents. To the contrary, the Sewing Machine Combination was formed against the backdrop of the strong protection of property rights in patents in the antebellum era. Thus, the story of the invention of the sewing machine is a striking account of early American technological, commercial and legal ingenuity, which heralds important empirical lessons for how patent thicket theory is understood and applied today.

Ben Barros

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March 19, 2009 in Intellectual Property, Property Theory, Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

Monday, February 9, 2009

Schultz on Live Performance and IP

Mark F. Schultz (Southern Illinois) has posted Live Performance, Copyright, and the Future of the Music Business on SSRN.  Here's the abstract:

This article considers whether the emergence of business models based on free digital delivery of music and other content have rendered copyright protection less necessary or justifiable. Falling production and distribution costs have led many scholars and popular commentators to conclude that creators can and should embrace free distribution models for copyrighted works. In particular, many contend that the recording industry can survive and prosper by producing and freely distributing recordings as a form of advertising for the concert business. Some have further concluded that copyright law may need to change to reflect this new reality.

This article assesses such proposals, drawing insights from cultural economics, the literature on the economics of copying, and empirical data regarding the health of the concert industry. When free business models work, they can work quite well (e.g., Google and, long before it, commercial broadcasting). Examination of theory and practice shows, however, that such models are practicable and desirable only under certain, specific circumstances.

The success of free business models depends on a fairly tight link between the free content and a sufficiently remunerative good or service. Concert revenue is not particularly tightly linked to free recordings - certainly not as tightly as examples such as open source software and support services, or online children's games and plush toys. Moreover, the concert business is lucrative mostly for older, well-established acts. The data collected here on concert revenues indicates that a handful of older acts now make most of the money in the concert business, while ticket prices for smaller, niche acts have stagnated over the last decade. Although much maligned, the modern record business supports a vast, remarkably diverse variety of recordings. If it had to rely on concert revenue alone, some acts would probably continue to record, but diversity and consumer choice and welfare would likely decrease.

The shortcomings of the live performance model indicate that the existence and occasionally tremendous success of "free" business models do not justify wholesale changes in copyright policy or legal doctrine. Business models based on direct sales and supported by copyright still provide tremendous advantages for creators and consumers.

Ben Barros

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February 9, 2009 in Intellectual Property, Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

Munzer on Community Biotechnological Assets

Stephen R. Munzer (UCLA) has posted Commons, Anticommons and Community in Biotechnological Assets on SSRN.  Here's the abstract:

I argue for three theses: T1 - It is possible to use access to scientific knowledge to reinforce existing scientific communities and sometimes generate new ones. T2 - It is possible to use community to generate scientific knowledge, patent reform, scientific research, medical diagnostics, and trade secrets and occasionally patents. T3 - On the spectrum from commons to semicommons to private property to anticommons, an anticommons can arise if a biotechnological asset is fuzzily defined. I defend these propositions against objection and establish the fertility of my account by considering intellectual property issues relating to synthetic biology. Along the way I present a new understanding of the public domain. I also pursue several projects that interweave throughout the article. The analytic project shows how careful definitions yield a useful taxonomy of biotechnological assets and their holders. The normative project explains why we should endorse intellectual property rights in some biotechnological assets but not others. Finally, the thematic project establishes larger contrasts between different forms of community on the one hand and individualism on the other, and reveals how my understanding of the public domain delivers a surer grasp of these contrasts and their roles in institutions of property.

Ben Barros

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February 9, 2009 in Intellectual Property, Property Theory, Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

Monday, January 19, 2009

Yale Pocket Part Symposium on Virtual Worlds

The Yale Pocket Part is holding a symposium on virtual worlds.  Two articles look like they would be of particular interest to property profs:  James Grimmelmann, Virtual World Feudalism, and Joseph Blocher, Reputation as Property in Virtual Economies.

Ben Barros

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January 19, 2009 in Intellectual Property, Property Theory, Recent Scholarship | Permalink | Comments (1) | TrackBack (0)

Friday, September 12, 2008

Tate on Taxation of Posmortem Publicity Rights

A while ago, I noted an interesting article by Gans, Crawford & Blattmachr on the tax treatment of rights of publicity.  Josh Tate (SMU) has now posted a response titled Marilyn Monroe’s Legacy: Taxation of Postmortem Publicity Rights.  Here's his first paragraph:

In an April 2008 essay in The Yale Law Journal Pocket Part, Mitchell Gans, Bridget Crawford, and Jonathan Blattmachr argue that recent state legislation recognizing postmortem publicity rights fails to take into account the likely estate tax consequences. Although Gans, Crawford, and Blattmachr are correct to argue that allowing publicity rights to pass by will or inheritance could have adverse tax consequences for some estates, those ramifications are not as far-reaching as might be imagined. Moreover, their “legislative solution” will not solve the problem.

Tate also has an abstract up on SSRN:

In an April 2008 essay in the Yale Law Journal Pocket Part, Mitchell Gans, Bridget Crawford and Jonathan Blattmachr argue that recent state legislation recognizing postmortem publicity rights fails to take into account the likely estate tax consequences. This response explains that, although Gans, Crawford, and Blattmachr are correct that making publicity rights devisable could have adverse tax consequences for some estates, those consequences are not as far-reaching as might be imagined, and the legislative solution they propose will not in fact solve the problem. Estate tax will not be levied on the estates of long-deceased celebrities like Marilyn Monroe (the subject of the recent California legislation with which Gans, Crawford, and Blattmachr lead their piece), and the analogy to wrongful death benefits misconstrues the case law on that subject. Gans, Crawford, and Blattmachr are employing the specter of federal death taxes - which have applied to devisable publicity rights in California since 1985, and are irrelevant to the recent legislative reforms there - in an attempt to frighten state legislatures into unnecessarily restricting testamentary freedom.

Ben Barros

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September 12, 2008 in Intellectual Property, Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

Wednesday, August 20, 2008

Mossoff on Patents as Property

Adam Mossoff (George Mason) has posted Patents as Property: Conceptualizing the Exclusive Right(s) in Patent Law on SSRN.  Here's the abstract:

The conventional wisdom is that the definition of patents as property has been long settled - patents secure only a right to exclude. In exploring the intellectual history of American patent law, this Article reveals that this claim is profoundly mistaken. For much of its history, Congress and courts defined a patent in the same conceptual terms as property in land and chattels, as securing the exclusive rights of possession, use and disposition. Nineteenth-century courts explicitly used this substantive conception of patents to create many longstanding doctrines in the American patent system, such as the conveyance default rules now known as patent exhaustion doctrine. Significantly, the Supreme Court has invoked such historical doctrine in reversing the Court of Appeals for the Federal Circuit in its many recent patent law decisions.

For this reason, the conceptual break between modern and historical patent doctrine is not simply a matter of philosophical inquiry. Today, scholars and courts believe that patents must secure only a right to exclude as a matter of logical necessity, dismissing the historical statutes and case law as confusion or dicta. Yet, they do not realize that their definition of patents as property is a uniquely modern conception, which follows directly from the legal realists' property theory in land. In identifying this intellectual history for the first time, this Article reveals how the legal realists' theoretical work concerning real property has influenced twentieth-century patent doctrine, and how this may be an under-appreciated factor contributing to the increasingly tumultuous debates over patent doctrine.

Ben Barros

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August 20, 2008 in Intellectual Property, Property Theory, Recent Scholarship, Takings | Permalink | Comments (1) | TrackBack (0)

Thursday, July 17, 2008

Townsend Gard and Goda on Virtual Property

Elizabeth Townsend Gard (Tulane) and Rachel Goda (Seattle) have posted The Fizzy Experiment: Second Life, Virtual Property and a 1L Property Course on SSRN.  Here's the abstract:

This work is an attempt to sort out the relationship between virtual property and common law property. How are we to understand the relationship between a virtual table and an actual table? What does property in this context mean exactly? While many have written about this topic from a myriad of perspectives, we took a slightly different approach. We wanted to see what property elements were being used inside one virtual space - Second Life. We sought to understand the relationship between common law property and virtual property by combining our knowledge as a property professor with a cultural history background with an avid gamer turned law student. We called it the Fizzy Experiment.

Ben Barros

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July 17, 2008 in Intellectual Property, Property Theory, Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

Saturday, May 31, 2008

Konomark and the extension of Aloha Jurisprudence

While Alitorros is up in Montreal enjoying Law and Society, I've been sweating out the move to Chapel Hill.  Now I'm in a pet friendly hotel in Chapel Hill, getting caught up on my blog reading....

Via Eric Johnson over at prawfsblawg, I've just learned about "konomark"--a pineapple inside a circle. 

It's a symbol that "that lets visitors to your website know that you are generally willing to share your copyrighted content, such as photos, educational materials, music, etc., with folks like yourself, for free. The konomark is an invitation to e-mail you and ask you for permission."

This is Eric's idea--he blogged about it last April over at prawfs, but I missed it back then.  I think this is great--and a great symbol of friendliness.  As the konomark website says,  "The Hawaiian word 'kono' means to invite, prompt, or ask in. The 'mark' part is pretty self-explanatory – the idea is to mark content that's shareable."  Makes me happy to see that a Hawaiian symbol is used to invite sharing of property--and makes me think that this is a further piece of aloha jurisprudence! (More on aloha jurisprudence here.)  I'm going to start konomarking my papers.  And maybe we'll have a similar sign for access to real property sometime soon--perhaps a palm tree in a circle?!

Alfred Brophy

May 31, 2008 in Intellectual Property | Permalink | Comments (0) | TrackBack (0)

Wednesday, March 19, 2008

Is "Intangible" a Property Category?

I think not. I was happy to get a comment on my last post, and the commenter suggested that the category "intangible" will disappear with respect to "virtual" money. I had two thoughts when I read the comment: first, "hmm, isn't all money virtual?" and second, "oh gosh, I need to write another post!"

The question I posed in that last post was "what can virtual property do for property?" and I hope to suggest some answers to that question in this and future posts. One thing that virtual property might do for property is to lure people away from thinking of "intangibles" as a property category. There are many different types of intangible assets, and lumping them together into a single category can impede the development of the law. I explain this point in more detail in my article, "False Categories in Commercial Law: The (Ir)Relevance of (In)Tangibility." Joshua Fairfield took a big step in the right direction when he defined "virtual property" as an asset class in his article, "Virtual Property." In that article, he describes "virtual property" as property that is "persistent, rivalrous and interconnected."

A well-known conversion decision illustrates the problem of viewing tangibility as the defining characteristic of an asset. That decision is the Ninth Circuit's decision in Kremen v. Cohen, 337 F.3d 1024 (2003), the "sex.com case."  In that case, the domain name registrar, Network Solutions, had followed bogus instructions to transfer sex.com (then the most valuable name on the Internet) from its original registrant, Kremen, to Cohen, who had no rights in the name.  Under the applicable California law, an intangible asset can only be converted if it is merged in a document. Therefore, a share of stock evidenced by a paper certificate can be converted, as can a negotiable instrument such as a promissory note. 

Network Solutions had behaved outrageously, and the Ninth Circuit did the right thing in saying that it had converted the domain name. The process by which Judge Kozinski reached that conclusion, however, doesn't do much for the development of property law. To find Network Solutions liable, the court had to find that the name WAS merged in a document. The problem with that approach is that there's no tangible document involved in domain name registration. Registration is completely electronic, and once the name is registered, it goes into the Domain Name System, which is also not only completely electronic, but is also distributed among a number of places. Nevertheless, the court found that sex.com was merged in a document, the domain name system!

Why is the decision in Kremen a problem? Because it focuses on the wrong characteristic of a domain name, its intangibility. By doing so, the court engaged in strange mental gymnastics to find that an electronic, distributed system is a "document" for the purpose of a conversion action. But why is a document so important to conversion anyway? Take a promissory note as an example. A promissory note is a reified right to payment, and that right is commonly transferred by negotiation, which involves physical delivery. If a person takes a note from its rightful owner, that person can exercise control over the payment right, to the exclusion of the rightful owner. In other words, a promissory note is rivalrous.

Likewise, a domain name is rivalrous. When Network Solutions tranferred sex.com to Steven Cohen, Gary Kremen, the rightful owner, could not use it. There can only be one sex.com domain name. The court in Kremen v. Cohen declined to extend the tort of conversion to all intangible assets, which was the right conclusion. But extending it to domain names only because they are "merged in a document" is also wrong. By focusing on intangibility rather then on rivalrousness, the Ninth Circuit missed a great chance to modernize the law to account for emerging electronic rights.

But what do virtual worlds have to do with this? Everything in a virtual world is intangible, but the rights embodied in these intangible assets are as different as the rights embodied in assets in the real, or tangible, world. The two disputes I discussed in my initial post, Bragg and Eros, illustrate this point in a way that a domain name dispute cannot. Bragg, a dispute involving intangible assets, is a conversion case. Linden interfered with Marc Bragg's use and enjoyment of his virtual world assets in the same way that a bicycle thief might interfere with my use and enjoyment of my bicycle. Eros, another dispute involving intangible assets, is an intellectual property case. In that case, Thomas Simon didn't interfere with anyone's use of a sex bed (and no, I will not post about how a sex bed works. Google it); he instead interfered with the right of Eros to make copies of and distribute the sex bed. So virtual worlds, by giving us the opportunity to resolve myraid property disputes, ALL of which involve intangible assets, might help us to clarify our thinking about intangible assets.

Juliet Moringiello

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March 19, 2008 in Intellectual Property | Permalink | Comments (2) | TrackBack (0)