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Development of Intellectual Property Law in the United States Essay Sample

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Development of Intellectual Property Law in the United States Essay Sample

The development of intellectual property law in the United States has followed the development of society within the United States from a primarily agricultural society during the 1700’s to today’s technological society. The development of intellectual property law in the United States has also followed the development of American law in general. As America moved into and through the Industrial Revolution of the 1800’s, intellectual property laws became more and more numerous and stringent as people and industry worked to safe guard their money making ideas and products. The explosive use of the internet in today’s society has added an entirely new wrinkle to protection of concepts and ideas and products in the market place.

Black’s Law Dictionary defines intellectual property as “a category of intangible rights protecting commercially valuable products of the human intellect.” (Black’s Law Dictionary 1999, 813) Many times these can apply to intangible items like ideas but can also include tangible items like the Model T Ford of Henry Ford. The term intellectual property is a relatively new term but the concept of what intellectual property is has been around for many years. The term intellectual property encompasses copyrights, patents, and trademarks.

Copyright laws “protect ‘original forms of expression’ – Magic Mountain, ‘Star Wars,’ ‘Fiddler on the Roof’.” (William W. Fisher 1999, 1) Trademarks apply to protection of a word or phrase or symbol used to guarantee a product’s genuineness. (Black’s Law Dictionary 1999, 1500) The Nike “swoosh” and the “three stripes” of adidas are examples of trademarks. Patent is defined by Black’s Law Dictionary as “[t]he exclusive right to make, use or sell an invention for a specified period of time granted by the federal governmental to the inventor if the device or process is novel, useful and nonobvious.” (Black’s Law Dictionary 1999, 1147) An example of a patent would be Thomas Edison’s light bulb patent which was granted in 1880 for his exclusive use.

The origins of patent law and copyright law can be found in British Statute of Anne and the Statute of Monopolies. The Statute of Anne dealt primarily with copyright regulation and is a “watershed event in Anglo-American copyright history, transforming what had been the publishers’ private law copyright into a public law grant.” (Patterson and Joyce 2003) This act was later repealed. The Statute of Monopolies dealt with patent laws and was the first statutory patent law, as all previous patent laws were based on customs.

In the United States, the primary power to create and enforce intellectual property law was vested with the Federal Government. “The Constitution (Art. 1, sec. 8) gave Congress power ‘[t]o promote the progress of science and the useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.’ This was the formal source of federal power over patents and copyrights” and later all intellectual property. (Friedman 1973, 1)

The Framers of the Constitution knew well the restrictive patent laws of England and looked to depart from the shortcomings of the British system. It was also a goal to encourage new ideas and inventions which would add to the overall economy of the Colonies and expand their economic standing and overall standard of living.

Accordingly, in April of 1790 the first patent legislation was passed by Congress, the Patent Act of 1790. Prior to that act, patents were granted by the individual colonies. The powers of the 1790 Act to grant patents were given to the Patent Board which was made of three members; Secretary of State (Thomas Jefferson), Secretary of War (Henry Knox) and the Attorney General (Edmund Randolph). The court system was responsible for the administration of patent infringement. The original act was quickly amended, due mostly to the urgings of Secretary of State and amateur inventor/scientist Thomas Jefferson, as Jefferson believed in a more succinct description of the items brought for patent.

Originally, Jefferson was opposed to patent legislation in general as he believed it was contrary to a free republic. However, “Jefferson, always the scientist, warmed to his duties and became more open to the idea of patents when he saw how many inventors put forth their ideas as a result of the new system of protection.” (Jewett 2000) Jefferson realized the importance of the patent and its direct correlation with the increasing numbers of new ideas presented for patent application. He played an instrumental role in the continued development and expansion of the Patent Office and the patent application process and is credited for its continued growth to this day.

There were several amendments and revisions to intellectual property laws from the time of the Act of 1790 and its first Amendment in 1791; however, it was not until 1925 that the Patent Office was transferred from the Department of State to the Department of Commerce, where it remains today. The Office is called the United States Patent and Trademark Office. Copyrights are administered by the United States Copyright Office in the Library of Congress Building in Washington, D.C., which office was centralized in the Library of Congress in 1870 and later made a separate Department in 1897. (United States Copyright Office website 2012)

A discussion of intellectual law would not be complete without a mention of trade secret law. Trade secret is defined as “a formula, process, device, or other business information that is kept confidential to maintain as advantage over competitors.” (Black’s Law Dictionary 1999, 1501) A trade secret, as defined under 18 U.S.C. § 1839(3) (A), (B) (1996), has three parts: (1) information; (2) reasonable measures taken to protect the information; and (3) which derives independent economic value from not being publicly known.” An example of trade secret would be KFC’s (formerly known as Kentucky Fried Chicken) secret recipe for their fried chicken batter. That recipe is kept confidential and seen only by a handful of individuals under the employee of KFC.

Trade secret protection does not expire like patent protection does, but trade secret protection is subject to possible theft by a third party. It is possible to file for a patent and still maintain the trade secret of the asset as full disclosure of the asset must be made at the time of application, and the final product could vary slightly from the time of filing with the time the product is finished. Pharmaceuticals would be a good example of that scenario as there will often be changes in that time period.

Trade secrets can be protected under nondisclosure agreements signed by employees or other that might gain access to the trade secret, but those agreements are subject to employment laws and are often times and are often times hard to enforce if violated.

The Uniform Trade Secrets Act of 1979 as later amended, attempted to solidify laws on the federal level as to trade secrets as prior to the Act, trade secret law were handled at the state level. So, the Act attempted to bring trade secret law to the level of patent law and provide more protection to trade secrets.

In recent years there have been some important legal cases involving intellectual property law. In the 2002 case eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2006), the Supreme Court ruling overturned a lower court ruling of imposing an injunction against eBay’s use of the Buy It Now feature on their website which was based on MercExchange technology. (eBay Inc. v. MercExchange, L.L.C 2006) With this ruling the Supreme Court changed the test used to decide when to order an injunction in patent cases. The Supreme Court ruled that in matters of patents courts should use the same test used for other matters involving an injunction. “That test requires courts to analyze: (1) whether the plaintiff will suffer irreparable harm without the injunction; (2) whether there is an adequate remedy at law; (3) the balance of hardships on the respective parties; and (4) whether granting an injunction would disservice the public interest.” (Chao 2008, 544)

This case changes the way Plaintiffs in patent cases will work for a permanent injunction, now they will need to pass the four point test shown above, thereby, making it more difficult for parties in these types of cases to win a permanent injunction. It could be argued that this new test might make the possibility of a favorable outcome less likely for the Plaintiff and might prevent the matter being brought to litigation. On the other hand, it could be argued that the case reduces the validity of an in place patent.

In 2011, the Court appears to have taken a reverse course and found in favor of the patent holders. For example, “in Global Tech Appliances, Inc. v. SEB S.A. (No. 10-6.), the [Supreme] Court affirmed the Federal Circuit’s holding that a Hong-Kong-based company which reverse-engineered a deep fryer could be held liable for ‘actively inducing’ infringement even though it acted on the basis of a legal opinion that its product did not infringe.” (Mann 2011) Likewise, in “Microsoft Corp. v. i4i Limited Partnership No, 10-290), the [Supreme] Court acquiesced in the Federal Circuit’s longstanding conclusion that patent challengers must establish invalidity by ‘clear and convincing evidence’ even when they present prior art that the Patent Office never saw.” (Mann 2011)

As is the case with any type of legal ruling, the outcome is left to interpretation of the judiciary. As evidenced above, it appears that the tide is again turning to the pro-patent findings in favor of the patent holders.

Another significant intellectual property case in the recent past is A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004 (2001). This forever changed the way people accessed music from the internet. Napstar was a website that allowed free downloading from the internet of music by Napstar users. They could download the music to their hardware device (i.e., ipod) and have the music as their own with no costs to the user. Of course, that meant that there was no consideration paid to the music artist, the record company or anyone involved in the recordation and production of the musical tracks. This did not make for a happy record company or musician as that was cutting into their profit margins. So, the record companies among others (there was a list of Plaintiffs including record companies and recording stars), took their concerns to court. The Court found that Napstar was liable for contributory infringement and vicarious infringement (vicarious defined as “performed or suffered by one person as substitute for another” (Black’s Law Dictionary 1999, 1560) and infringement defined as “as act that interferes with one of the exclusive rights of a patent, copyright, or trademark owner” (Black’s Law Dictionary 1999, 784)) of the plaintiffs’ copyrights.

This was the first case to test what is called peer-to-peer file-sharing, the transfer for one file (in this case musical recordings) from one person to another. In this case there was no price paid to the recording artists thereby, infringing on the copyrights. Since the ruling Napstar has shut down, but peer-to-peer file sharing is still quite popular in today’s society, but in cases of certain transfers that involved copyright, a consideration (cost) is to be paid. iTunes would be a good example of a legal peer-to-peer file sharing site.

The United States has been and remains a leader in the protection of intellectual property rights. The National Intellectual Property Rights Coordination Center (NIPRCC) is just such an example of that leadership. Created in 2000 by the United States Customs Service, the NIPRCC relies on the manpower and technology of many Federal agencies and “uses the expertise of its member agencies to share information, develop initiatives, coordinate enforcement actions, and conduct investigations related to [intellectual property] theft.” (National Intellectual Property Rights Coordination Center website 2012)

The United States’ continues to lead the way with intellectual property law protection. In 2010, the White House released the 2010 Joint Strategic Plan on Intellectual Property Enforcement in which is a detailed plan for the multi-agency Federal plan to continue to protect and preserve the intellectual properties of the United States. It involves the work of many Federal agencies across the board, including but not limited to the Departments of Justice, Homeland Security and even the Department of Agriculture. The plan includes a course of action that will aid the protection of intellectual property of the United States and ensure that the illegal use of these properties will be weeded out.

As the world becomes “smaller and smaller,” due in big part to improved technology, and people around the globe are able to easily communicate, the business cycle and worldwide economies have become closer and closer and more countries are doing business together as well as in each other’s countries, the issue of worldwide intellectual property has come to the forefront. In an effort to bridge this possibly large gap, the United Nations in 1967 founded World Intellectual Property Organization (WIPO). WIPO’s goal is “to promote innovation and creativity for the economic, social and cultural development of all countries, through a balanced and effective international intellectual property system.” (World Intellectual Property Organization website 2012) The organization was founded in an effort to promote and harmonize worldwide intellectual property laws.

Since WIPO’s inception, they have been able to create the Patent Cooperation Treaty (PCT) in 1970 (as amended) which is a joint effort among the member states to create a unified filing system that will protect intellectual properties in the member states. While the treaty and related process of filing and review does not grant a patent as patents are nationalized, it is a step in the direction of preventing intellectual property ownership disputes before they happen.

During its history, the United States has been a leader in intellectual property law from the Patent Act of 1790 to the continued efforts of the federal government to protect the intellectual property rights of its citizens inside and outside the borders of the United States. What was first started under the watchful eye of Thomas Jefferson has grown from a simple patent office of three men to a wide array of laws, regulations and agencies working towards a common goal.

The laws regarding intellectual property have grown and changed to adequately address the needs of a changing society. As the technology of the internet has exploded, the laws have addressed the needed changes. And as this technology shrinks our world and makes the worldwide economy one, the United States has taken an active role in worldwide intellectual property law.

Trade secret laws, too, are coming of age as the federal government looks to streamline the laws so that they laws apply to all states rather than the state by state basis they are on now, thereby, clearing up possible ambiguities in the laws.

Recent court cases seem to indicate a movement back towards the pre-patent rulings and supporting the patent holders in cases that involved infringement as evidenced in cases from 2011.
In conclusion, the United States laws regarding all intellectual property protection have adopted as needed and will need to continue that process as the concepts of intellectual property and protecting those assets become more and more complicated. Technology is such that new ideas and concepts are created daily and the inventors and users of the technology are always looking to improve and be a step ahead of the competition. In some instances, the competition might look to use others’ ideas to their advantage, and that is why the United States needs to continue to be a leader in the development of, implementation of and enforcement of current intellectual property laws.

References:

Bryan A. Garner (Editor in Chief). “Black’s Law Dictionary, 7th Ed.” St. Paul, MN: West Group, 1999. Chao, Bernard H. “After eBay, Inc. v. MercExchange: The Changing Landscape for Patent Remedies.” University of Minnesota website. 2008. http://www.ahc.umn.edu/mjlst/prod/groups/ahc/@pub/@ahc/@mjlst/documents/article/ahc_article_366119.pdf. Chief), Bryan A. Garner (Editor in. “Black’s Law Dictionary, 7th Ed.” St. Paul, MN: West Group, 1999. eBay Inc. v. MercExchange, L.L.C. 547 U.S. 388 (Supreme Court of the United States, 2006). Friedman, Lawrence M. “A History of American law.” 224. New York, NY: Simon and Schuster, 1973. Jewett, Thomas O. Thomas Jefferson: Father of Inventon, Jefferson’s Vision of Protecting the Rights Of the Inventor and the Common Man Still Remain Principles of That Office Today. 2000. http://www.earlyamerica.com/review/winter2000/jefferson.html. Mann, Ronald. Commentary: Tide turns for Federal Circuit in patent cases. 6 July 2011. http://www.scotusblog.com/2011/07/ronald-mann-reviews-the-patent-cases-of-ot2010/. National Intellectual Property Rights Coordination Center website. 2012. http://www.iprcenter.gov/about-us. Patterson, L. Ray, and Craig Joyce. “Copyright in 1791: An Essay Concerning the Founders’ View of Copyright

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