Global Dimensions of Intellectual Property Rights in Science and Technology (1993) / Chapter Skim
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11 Adapting the Intellectual Property System to New Technologies
11 Adapting the Intellectual Property System to New Technologies
Pages 256-283
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From page 256... ...
New technologies may require fundamentally new encouragement mechanisms and pose fundamentally new issues for the intellectual property system. Thus the question here is whether the system develops the appropriate new doctrines and mechanisms at a rate adequate to maintain incentives to innova tion.
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From page 257... ...
Also, intellectual property protection is crucial for each of the three; for all, front-end costs are very large, copying of a marketed product is much easier than initial development, and product cycles are long enough that copying is a serious consideration.2 Biotechnology Biotechnology is defined here as genetic engineering and particularly recombinant DNA manipulation. Although it is different from more traditional areas such as pharmaceutical technology in that living organisms are involved and can often reproduce themselves, what has most troubled the early evolution of the law is the fact that many of the products and processes being patented derive directly from natural products and processes.
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From page 258... ...
A court ends up having to decide, for example, between two different proposed inventors, one of which may have isolated the protein first, while another has sequenced it first.6 The substantial delays that have marked the biotechnology patent area have intensified this problem, as competing firms have invested in research for a number of years without knowing which one will obtain the ultimate patent rights.7 This difficulty in identifying a specific point of invention is the fundamental problem underlying the current dispute over the National Institutes of Health patent application covering some 337 gene fragments sequenced as part of Craig Venter's CDNA approach to the human genome project.8 Traditionally (i.e., for the last decade or so) , identification of the therapeutic value of a protein arose before its sequence was known; identification of the sequence became a particularly important step in defining priority for gaining patent rights.
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From page 259... ...
Agricultural biotechnology has long been concentrating on transgenic plants and animals rather than therapeutic products; human biotechnology will probably look for new products not found in nature and for new ways to use them. The fact that living organisms are involved in biotechnology (and especially in agricultural biotechnology)
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161-164) for most species of asexual plants and the Plant Variety Protection Act of 1970 (7 U.S.C.
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This is the Plant Variety Protection Act of 1970, supra. 17Proposal for a Council Directive on the Legal Protection of Biotechnological Inventions, COM(88)
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Programs are i9R. Davis, Intellectual property and software: The assumptions are broken, in World Intellectual Property Organization, WIPO Worldwide Symposium on the Intellectual Property Aspects of Artificial Intelligence, Stanford University (March 25-27, 1991)
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From page 263... ...
Then too, the embedding of software in products may create even more difficulty consider, for example, the proposals to couple computer chips and biological sensors in ways that might allow "intelligent" management of the construction of individual biological polymers. Solutions, Thus Far In contrast to biotechnology, this area started out with an early expert advisory study by the National Commission on New Technological Uses of Copyrighted Works (CONTU)
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From page 264... ...
; P Samuelson, CONTU revisited: The case against copyright protection for computer programs in machine-readable form, 1984 Duke L.J.
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Perhaps in response to the difficulties posed by copyright law in the software area, a number of firms have been seeking software patents. The area is governed by one of the most opaque series of Supreme Court cases that can be found in any body of law: Gottschalk v.
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The combination of troublesome questions and an ill-adapted statute suggests that CONTU was almost certainly wrong in its judgment that the copyright system should be used instead of a sui generis approach.38 35D. Karjala, Protection of computer programs under Japanese copyright law, [1986]
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From page 267... ...
Likewise, statistics until this point, these winners and losers have succeeded in maintaining the copyright approach with rather strong rights for the copyright holder; the difficulties of the approach may, however' be beginning to give rise to dissatisfaction in the business community as well as in the academic community. 39I have decided not to consider this type of problem in this chapter; nor do I consider the converse issue based on the [act that current technologies permit easy reproduction of printed or digital copyrighted materials.
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From page 268... ...
Although such unscrambling was also held to violate the communications laws,40 this case rested in part on a judgment that the "pirate" chip infringed the copyright in the original scrambling chip. Sooner or later, someone will reverse engineer such a chip in a way that is legitimate under the copyright laws and perhaps in a circumstance in which the communications laws do not apply, and in at least one current reverse engineering case, infringement arguments have been rejected, Vault Corp v.
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From page 269... ...
was, because it was information, uncopyrightable.42 The result, certainly correct from a copyright law and freedom of information perspective, but paradoxical for the future of the industry, is that the more expensive information input to integrated data bases is unprotectable, while the cheaper expression input is protectable. Thus, although it may be a little early for making a judgment, the existing copyright protection system is likely to pose fundamental difficulties for data bases, just as it does for software.
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From page 270... ...
The EC and who activities in the biotechnology area have, however, been much more effective in locating the difficult issues early on; they suggest that a committee process can be more effective than case law in identifying new doctrinal issues. Although the EC proposals have not yet become law, the European discussions have produced quite thoughtful analyses of most of the hard issues and effectively illuminated the policy arguments on each side of these issues.
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From page 271... ...
Nevertheless, the system has worked; it is one of the few forms of intellectual property protection that has been shown to increase innovation,47 and many firms in the traditional seed industry have urged use of this system for plants instead of the regular patent system. At the same time, there is forum shopping; some of the firms in the seed industry have attempted to obtain regular patents on materials that seem more appropriate to plant variety protection.48 45The difference in proportions of biotechnology and software cases (not including network cases)
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Also although this point is far from clear errors in creating sui generis forms of protection may be harder to undo than errors in adapting existing forms of protection. Summary In spite of these limitations, experience with sui generis approaches is relatively encouraging, compared to the ability of the courts or of shortterm advisory panels to define ways to modify existing laws to meet new technologies.
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From page 273... ...
; with Committee of Experts on Biotechnological Inventions and Industrial Property, Industrial Property Protection of Biotechnological Inventions; Revised Report prepared by the International Bureau (prepared for the Third Session) , WIPO BioT/CE/III/2 (April 8, 1987)
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From page 274... ...
As an overall matter, the general increase in patent applications is taking place at a manageable rate. The number of patent applications filed increased from 106,295 in 1970 to 163,306 in 1989;57 this corresponds to an increase of 2.3 percent per year, slightly less than the 3.1 percent annual increase of real R&D expenditures over the same period.58 Also, if deviations in individual technology sectors are ignored, the PTO anr~ear.s to have been Quite successful in managing this case load.
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This might even be true of biotechnology-except for the facts that development costs are so large, that development takes as long as the patent application processing time, and that these ongoing expenditures will be wasted if a competitor gains the patent rights. 63"Practically once a month, the nation's computer networks are abuzz with news of another patent issued on a fundamental concept that is widely used." S
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From page 276... ...
A separate group of enforcement issues arises at the international level and will probably be felt more strongly in the biotechnology sector than in other sectors discussed in this chapter. Many nations have hesitated to extend as wide a scope to intellectual property protection of biotechnology as does the United States, so that doctrines differ significantly from nation 64A.
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From page 277... ...
The biotechnology industry would like to extend these rights further through making essentially automatic the granting of process claims in a number of situations in which product claims are already granted.69 In a world that has not achieved patent law unification and an industry that is and must be internationally based, this kind of trade barrier will also be a barrier to progress by decreasing the extent to which product intermediates made legitimately in one nation can be exported to another. Significant extension of the section 337 process will lead to global suboptimization and enormous headaches for managers who are attempting to organize on an international level.70 Nevertheless, current political trends in the U.S.
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From page 278... ...
Informal Approaches Business has its ways of adapting to the difficulties of applying intellectual property systems. For example, the American Society for Composers, Authors, and Publishers is a privately created network that resolves the practical problems of collecting and distributing royalties in the musical area where there are so many individual performances of copyrighted works.
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From page 279... ...
Given the international cross-flows of technology in the semiconductor sector, it is hard to imagine that the patent battle will not soon be settled. 74In contrast, agricultural biotechnology may well turn out to involve proprietary genes with a variety of applications marketed through licensees with expertise in particular seed markets; the licensing structure may not be a traditional cross-license pattern, but it is likely to be relatively stable.
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From page 280... ...
Despite inconclusive quantitative evidence, there are many historical and recent examples of small fibs playing an important role in the establishment of new branches of industry and the rejuvenation of old ones. Gellman Research Associates, Indicators of International Trends in Technological Innovation, report prepared for the National Science Foundation (1975)
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35-36. 77With a first-to-file system, one can publish patent applications without fear of complicating priority disputes and thus speed the flow of scientific information.
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one can suggest the following general conclusions: Sui generis approaches are far more likely to be successful than one might have expected and should be utilized far more often. The European biotechnology and software directives and the plant variety protection and chip mask work statutes are all relatively encouraging.
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From page 283... ...
79Note that in the absence of international agreement, one can use statutory reciprocity in the pattern of the chip mask work arrangement. Even so, it would be best to coordinate such efforts with as many other nations as possible.
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