Lords of the intellectual property ring

It's a tough job but we have to start somewhere.

This article attempts to examine these stages in real-world action. However, this is not intended to be a legal guide although statutes and international agreements are mentioned.

Instead, it is more an account of IP protection in general and a recount of recent events in the United States – a country with a more advanced tradition and track record in IP. There are tips and clues, and lessons to be learnt from these in our own efforts to harness the powers of IP.

The main characteristic that separates intellectual property from that of the more traditional and conventional property like land, vehicles, metals etc is in their physical form – or lack of.

Intangible
IP consultant Caslon Analytics (www.caslon.com.au) notes that the property of the mind is incorporeal, or without material form or substance. It is quick to qualify this:

“But it can be embodied in a physical entity in the form of a book, painting, software program, symbol or song, for example.” However, it must also be noted that IP “is distinct from that entity and can, for example, be traded separately.”

It is therefore intangible – an asset that is saleable although not being of material or physical form.

Consider this: When you buy Pink Floyd's The Dark Side of The Moon music CD, you don't own the music. Rather, you obtain a licence for certain uses of that music, which is buried by tons of what you cannot do.

The only thing that you will own is the plastic that makes up the disc and its protective container. And the glossy paper too, with the album's cover of that most famous of prisms plus miscellaneous information about the songs and musicians.

It's the same with commercial software. When you buy Microsoft's Office suite, for example (or, to be fair, any other similar software), you only obtain a licence to use it. And there are many restrictions and limitations, plus unique clauses and methods of enforcement that are possible only with this type of IP.

Not happy with all these one-sided restrictions? If you want to use the software, you'll just have to grin and bear it. That's because IP owners call all the shots, armed with the power accorded by copyright law – a concept and statute that has been in existence for 300 years.

History
The modern copyright law is derived from England's “Statute of Anne” of 1710, which reflected the philosophy espoused by people like John Locke. In his 1690 Two Treatises on Civil Government, Locke argued that authors have a natural right to their work because they had expended labour in creating it and that public dissemination of knowledge was necessary for civil society.

In today's world, it is to provide authors with incentives and to encourage creativity in the process. This is the definition given by IP lawyer Terry Carroll in the Copyright Law FAQ, (www.faqs.org):

“A copyright is a right of intellectual property, whereby authors obtain, for a limited time, certain exclusive rights to their works.”

“In contrast to copyright is 'public domain.' A work in the public domain is one that can be freely used by anyone for any purpose.”

Note that the term “author” is used to mean the creator or producer of all IP products and is not limited to literary works only. IP assets can come in the form of writings, music, films, plays, software programs, images and characters, among others.

With copyright, the author or owner of the work is in the lordly position of deciding what to bestow on the peasants and also what to withhold.

He usually receives payment in the form of royalty for granting these permissions. These rights can be transferred to others and can also be inherited upon the author's death.

Nowadays, a copyrighted work published in one country will usually have the same protection in another. Many, if not most, countries are signatories of either the Berne Convention or the Unesco-administered Universal Copyright Convention (UCC) even when they are not IP producers of any note. This is due to the pressure brought about through trade agreement talks by the United States and the European countries, which are understandably keen to have their IP copyrights respected and protected everywhere.

Berne Convention
The signatories are required to follow specifications as contained in the Berne Convention 1971 Paris Text, which is administered by the World Intellectual Property Organisation (Wipo). This is the modern version of the 1886 Berne Convention for the Protection of Literary and Artistic Works established in Switzerland. Works from elsewhere are accorded the same protection as that given to local authors of a particular country if both are Berne or UCC signatories.

This particular trivia might be of interest: The United States, which loudly and frequently complains about the blatant and widespread piracy of its copyrighted software, music and films, was once the world's top IP pirate right until the end of the 19th Century!

How times have changed. That dubious distinction now belongs to countries in the Far East and Eastern Europe. And they might face possible sanctions if IP-fuelled countries like the United States and those in the European Union are not satisfied with the measures taken by these governments to fight piracy.

The law today
The present day copyright duration depends on the individual country. Since most are signatories of the Berne Convention, their respective copyright laws and terms must comply with it. And Berne specifies a minimum duration that covers the whole life of the author plus another 50 years after his death (life + 50). This is also the term used in Malaysia and many other countries (see www.lawyerment.com.my).

The European Union had issued a directive on this in 1993. Members are to follow the longest term that is used among them, which happens to be life + 70. This will likely be the international standard considering how influential the EU is.

Actually, it is now almost guaranteed since the United States – the IP heavyweight champion of the world both as a producer and consumer – has extended its own duration to match. This happened when its Congress passed the Sonny Bono Copyright Term Extension Act in 1998.

This is a controversial piece of legislation and is the centre of heated debates, arguments and accusations due to its far-reaching effects. It was also the subject of an unsuccessful constitutional challenge that ended in the US Supreme Court in 2003 (see en.wikipedia.org/wiki/Sonny_Bono_Copyright_Term_Extension_Act).

Many Americans are incensed with what they see as blatant favouritism by US Congress towards a powerful (and rich) few – the entertainment, media and publishing industries, and also the heirs of famous composers. They are the holders of economically valuable copyrights, like the successful cartoon characters of Mickey Mouse, Minnie, Goofy, Pluto and Donald Duck, and the songs created by George and Ira Gershwin especially.

These copyrights were about to expire, with the works passing into the public domain as a result. That also means the end of royalty payments. The August 1999 issue of Forbes Magazine reported that Gershwin's Rhapsody In Blue, which was composed in 1923 and due to expire in 1998, had earned lifetime revenues of more than US$50mil (RM190mil), including a decade in United Airlines advertisements. And this is only one of the many works left by the Gershwins!

The Sonny Bono Act, however, extends copyrights – including existing ones – by another 20 years. Individual owners now hold life + 70 copyrights while corporations get 95 years after the first publication.

This is good for the owners but it brings disastrous results for nearly everyone else, including organisations like Project Gutenberg that depend on copyright-free works.

That's because the 20-year copyright extension also covers other works too – works that do not have any economic value and are just lying idle. However, they too are locked out of the public domain – wasteful indeed because that denies others the opportunity to reuse them.

Source: Malaysia Star