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      NEW WINE INTO OLD BOTTLES: TECHNOLOGICAL CHANGE AND INTELLECTUAL PROPERTY RIGHTS

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      Prometheus
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      Copyright, intellectual property rights, patents, technological change
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            Abstract

            Technological progress involves conflicting consequences for the owners of intellectual property rights. On the one hand, the scope of these rights is enhanced and new subject matter is protected. On the other hand, the effective exercise of rights is often hampered and sometimes completely undermined. It is therefore timely to take stock of the effect of technological change on the traditional formulation of intellectual property rights. In particular, the following issues need to be considered: (i) the goals of intellectual property protection, (ii) the present scope and duration of protection, (iii) the present challenges, (iv) the legal constraints on change at the national and international levels, and (v) strategies for the future, including the reformulation of existing regimes and the adoption of sui generis schemes.

            Content

            Author and article information

            Journal
            cpro20
            CPRO
            Prometheus
            Critical Studies in Innovation
            Pluto Journals
            0810-9028
            1470-1030
            June 1992
            : 10
            : 1
            : 53-82
            Affiliations
            Article
            8629514 Prometheus, Vol. 10, No. 1, 1992: pp. 53–82
            10.1080/08109029208629514
            a346821a-53de-401a-b2e3-c4a73b0ed4d5
            Copyright Taylor & Francis Group, LLC

            All content is freely available without charge to users or their institutions. Users are allowed to read, download, copy, distribute, print, search, or link to the full texts of the articles in this journal without asking prior permission of the publisher or the author. Articles published in the journal are distributed under a http://creativecommons.org/licenses/by/4.0/.

            History
            Page count
            Figures: 0, Tables: 0, References: 113, Pages: 30
            Categories
            Original Articles

            Computer science,Arts,Social & Behavioral Sciences,Law,History,Economics
            intellectual property rights,patents,technological change,Copyright

            NOTES AND REFERENCES

            1. Matthew, chapter IX, verses 16 and 17.

            2. This explanation (which seems perfectly reasonable) is to be found in an old family bible of uncertain date, (but probably around 1880): The Annotated Paragraph Bible, The Religious Tract Society, London (1880-?), p. 1073, note 17.

            3. Article 2(viii) of the Convention establishing the World Intellectual Property Organisation, adopted at Stockholm, 14 July 1967. Australia has been a member since the inception of the Convention.

            4. This reluctance to afford general protection to such matters was well summed up by Dixon J. (as he then was) of the Australian High Court in the famous case of Victoria Park Racing and Recreation Grounds Co. Ltd. v. Taylor (1937) 58 CLR 479 at 509: [The courts] have not in British jurisdictions thrown the protection of an injunction around all the intangible elements of value, that is, value in exchange, which may flow from the exercise by an individual of his powers or resources whether in the organisation of a business or undertaking or the use of ingenuity, knowledge, skill or labour. This is sufficiently evidenced by the history of the law of copyright and by the fact that the exclusive right to invention, trade marks, designs, trade name and reputation are dealt with in English law as special heads of protected interests and not under a wide generalisation.

            5. Copyright Act 1968 (Cth.)(as amended).

            6. Designs Act 1906 (Cth.)(as amended).

            7. Patents Act 1952 (Cth.)(as amended).

            8. Trade Marks Act 1955 (Cth.)(as amended).

            9. Plant Variety Rights Act 1987 (Cth.).

            10. Copyright Act 1968, Part XIA (added by Copyright Amendment Act 1989).

            11. Circuits Layouts Act 1989.

            12. For example, the Olympic Insignia Protection Act 1987 (Cth.); the Advance Australia Logo Protection Act 1984 (Cth.).

            13. B. V. Hindley, ‘The economic theory of patents, copyright and registered industrial designs’, Background Study to the Report on Intellectual and Industrial Property, Economic Council of Canada, 1971, p. 1. See further, W.M. Landes and R. Posner, ‘An economic analysis of copyright law’, Journal of Legal Studies, 18, 1989, p. 325.

            14. Bishop W.. 1980. . ‘Negligent misrepresentation through economists’ eyes’. . Law Quarterly Review . , Vol. 360((96)): 363––9. .

            15. Posner R.. 1985. . Economic Analysis of Law . , 3rd ed. p. 3

            16. More correctly, the result of the transaction in question should be that sufficient gains are generated to the beneficiaries of the transaction that they could, hypothetically, compensate the losers from change so as to render the latter fully indifferent to it but still have sufficient gains left over for themselves: M. Trebilcock, Economic Analysis of Law, 1990. This is the concept of Kaldor-Hicks efficiency, which should be contrasted with Pareto efficiency, as to which see generally: Trebilcock, op. cit.; B. Ackerman, Economic Foundations of Property, 1975, pp. xi-xiv; R.A. Posner, op. cit., pp. 11–15; and B.V. Hindley, op. cit., pp. 1–2. Note also that there are a number of qualifications that need to be made in relation to these statements, e.g., the rights that are the subject of the transaction should be readily transferable with minimal costs, they should be readily appropriable, and there should be perfect information in the market place.

            17. Hindley, op. cit., p. 1.

            18. M. Pendleton, ‘Intellectual property, information-based society and a new international economic order: the policy options?’, Opinion, 1985, 2 EIPR 31.

            19. J. R. Kase, Copyright Thought in Continental Europe, 1971, p. 8. See further F. Machlup and E. Penrose, ‘The patent controversy in the nineteenth century’, Journal of Economic History, 10, 1950, pp. 11–17; and H.M. Spector, ‘An outline of a theory justifying intellectual property and intellectual property rights’, European Intellectual Property Review, 8, 1989, p. 270.

            20. As can be seen in the great case of ‘Literary Property’ in the 18th century: Millar v. Taylor (1769) 4 Burr. 2303, 98 ER 201.

            21. To the same effect, see the all-embracing definition of intellectual property in Convention establishing the World Intellectual Property Organisation 1967, op. cit., art. 2 (viii).

            22. Machlup and Penrose, op. cit., p. 15.

            23. Millar v. Taylor (1769) 4 Burr. 2303, 98 ER 201. To similar effect, see Walter v. Lane [1900] AC 539 (Lord Halsbury LC); Hogg v. Scott (1874) LR 18 Eq. 444 at 458 (Hall V-C); and Macmillan & Co. v. Cooper (1924) 93 LJPC 113, 119 (PC, Ind.). See also International News Service v. Associated Press (1918) 248 US 215, 239-241 (Pitney J.).

            24. Copyright and Designs Law: Report of the Committee to Consider the Law on Copyright and Designs, Cmnd 6732, HMSO, London, 1977, (the “Whitford Committee”), p. 3.

            25. Kitch E. W.. 1978. . ‘The nature and functions of the patent system’. . Journal of Law and Economics . , Vol. 20:: 265

            26. Not all creators are eager for reward: Benjamin Franklin declined the offer of a patent for his stove, saying that “as we enjoy great advantages from the Inventions of others, we should be glad of an Opportunity to serve others by any invention of ours, and this we should do freely and generously.”. Quoted by the Science Council of Canada, Innovation and Intellectual Property Rights in Canada, Discussion Paper, 1990, p. 13.

            27. See, for example, the arguments put forward in favour of granting copyright protection to works of architecture and to sound recordings before the 1909 Board of Trade Committee on copyright (Report, Cd. 4976, 9-10, 26) and in relation to cinematographic films and broadcasts before the Gregory Committee on copyright (Report, Cmnd. 8662, ch. 6). More recently, consider the arguments in Australia concerning the need to protect computer programs: J.McL. Emmerson, ‘Computer software: detailed inquiry needed before legislation’, Law Institute Journal, 58, 1984, p. 514. Note also the critical views of D. Vaver in ‘Intellectual property today: of myths and paradoxes’, Canadian Bar Review, 69, 1990, p. 98.

            28. See, for example, Hindley, op. cit., and B.C. McDonald, Copyright in Context: The Challenge of Change, 1971. For a review of the Australian patent system, see Supporting Papers for Economic Effects of the Australian Patent System, Industrial Property Advisory Committee, Australian Government Publishing Service (AGPS), Canberra, 1982. And for an iconoclastic approach that suggests that adversity, rather than the prospect of reward, may operate as a necessary stimulus for individual inventors, see S. Macdonald, ‘Human qualities necessary for invention: independent inventors and the stimulus of adversity’, Prometheus, 7, 1989, p. 333.

            29. I have in mind here the fact that, while the information cannot be used for the purpose for which the right holder has obtained protection, it may be possible for third parties to use the information for another purpose. For example, where X publishes a book on cooking, third parties cannot reproduce the particular form in which X's recipes are presented; on the other hand, they will be free to make the dishes described in the recipes or to use them as the basis for designing new recipes which they may then publish themselves. Again, if Y has a patent for new widget, X will be able to use this information for the purpose of making a different kind of widget so long as he does not make something which is substantially the same as that of Y. In other words, intellectual property rights do not usually completely block the further use of information once the latter is disclosed.

            30. Statute of Monopolies, 21 Jac. I, c.3 (1624), s. VI.

            31. House of Commons Debates, 5 February 1842, p. 350. Macaulay's point was a more subtle one, however, as his speech goes on to show. He was not so much concerned at the cost of the tax on readers as such, as with the fact that it provided authors with little or nothing more in the way of bounty: I admit, however, the necessity of giving a bounty to genius and learning. In order to give such a bounty, I willingly submit even to this severe and burdensome tax. Nay, I am ready to increase the tax if it can be shown that by so doing I should proportionately increase the bounty. My complaint is, that my hon. and learned Friend doubles, quadruples, the tax, and makes scarcely any perceptible addition to the bounty.

            32. For a detailed account of this with respect to the unremunerated use of British books by American publishers during the 19th century, see J. J. Barnes, Authors, Publishers and Politicians: The Quest for an Anglo-American Copyright Agreement 1815-1854, Routledge & Kegan Paul, London, 1974. On the piracy of books on the continent of Europe at the same time, see S. Ricketson, The Berne Convention for the Protection of Literary and Artistic Works: 1886-1986, Centre for Commercial Law Studies and Kluwer, London, 1987, ch. 1.

            33. See, for example, The Paris Act of the Berne Convention for the Protection of Literary and Artistic Works, 1971, Appendix; see further, S. Ricketson, The Berne Convention, op. cit., p. 623 ff.

            34. See generally, E. Armitage, ‘The Paris Convention: background to the diplomatic convention’, [1980] EIPR 83; S. Greif, ‘The compulsory working of patents: economic possibilities and limits with special reference to the developing countries’, Law and State, 26, 1982, p. 75.

            35. Ibid.

            36. A provocative argument along these lines (although not taken to its limits) is to be found in S. Breyer, ‘The uneasy case for copyright: a study of copyright in books, photocopies and computer programs’, Harvard Law Review, 84, 1970, p. 281. See also the reply to this by W. B. Tyerman, ‘The economic rationale for copyright protection for published books: a reply to Professor Breyer’, UCLA Law Review, 18, 1971, p. 1100 and Breyer’ s rejoinder in UCLA Law Review, 20 1971-1972, p. 75.

            37. In Australia, the most extensive examinations have been undertaken into the patent system: see generally, T.D. Mandeville, D.M. Lamberton and E.J. Bishop, Economic Effects of the Patent System: A Commissioned Report to the Industrial Property Advisory Committee, AGPS, Canberra, 1982 and supporting papers. See further the following reports by the Wollongong University Centre for Technology and Social Change: Technology Strategies in Australian Industry, AGPS, Canberra, 1990; and Strategic Alliances in the Internationalisation of Australian Industry, AGPS, Canberra, 1990.

            38. In this respect, it is worth noting that between 1982 and 1 September 1991, the specialist series of reports published by CCH Australia Pty. Ltd. had published reports of 837 judicial and administrative proceedings relating to intellectual property rights: see Australian Intellectual and Industrial Property Law, CCH Australia Pty. Ltd., Sydney, 1983-.

            39. Statute of Monopolies 1624, s. VI.

            40. Norman N. R.. 1983. . ‘Patent law revision: some economic considerations’. . Australian Business Law Review . , Vol. 12:: 226

            41. See, for example, Commonwealth of Australia v. John Fairfax & Sons Ltd (1981) 55 ALJR 45; Attorney-General (UK) v. Wellington Newspapers Ltd. [1988] 1 NZLR 129 (HC), 161 (CA); Attorney-General v. Guardian Newspapers Ltd. (No.2) [1988] 2 WLR 776 (HL); Salinger v. Random House Inc. (1987) 811 F.2d 90 (CA2); Morang v. Le Sueur (1911) 45 SCR 95 and Lindsey v. Le Sueur (1913) 29 OLR 648, aff'ing (1913) 27 OLR 588. See also P. Laval, ‘Fair use or foul?’, (1989) 36 Jo. Cop. Soc. USA 167; D. Vaver, ‘Intellectual property today: of myths and paradoxes’, Canadian Bar Review, 69, 1990, pp. 98, 109-113; C. Harvey and L. Vincent, ‘Historians’ rights’, Manitoba Law Journal, 10, 1980, 281; J. Conforti, ‘Copyright and freedom of expression’, Intellectual Property Journal (Canada), 5, 1989, p. 103.

            42. See generally, Patents Act 1990, s. 18.

            43. Ibid., ss. 53-8.

            44. See generally, Designs Act 1906, ss. 4, 17.

            45. 16 years: Designs Act 1906, s. 27A.

            46. See now the definition of ‘material form’ in the Copyright Act 1968, s. 10(1).

            47. Copyright Act, s. 31.

            48. Leslie v. J. Young & Sons [1894] AC 335 (HL); H Blacklock & Co. Ltd. v. C Arthur Pearson Ltd. [1915] 2 Ch. 376.

            49. Ladbroke (Football) Ltd. v. William Hill (Football) Ltd. [1964] 1 All ER 465 (H.L.).

            50. Mirror Newspapers Ltd. v. Queensland Newspapers Pty Ltd. [1982] Qd. R 305.

            51. See generally Baker v. Selden (1879) 101 US 99; Hollinrake v. Truswell [1894] 3 Ch. 420; L.B. (Plastics) Ltd. v. Swish Products Ltd. [1979] FSR 145.

            52. See generally Trade Marks Act 1955, ss. 24-26, 28, 33.

            53. See, for example, Parkdale Custom Built Furniture Pty. Ltd. v. Puxu Pty. Ltd. (1982) 56 ALJR 715.

            54. See generally Attorney-General (UK) v. Heinemann Publishers Australia Pty. Ltd. (1987) 10 IPR 153.

            55. See generally, S. Ricketson, The Law of Intellectual Property, Law Book Co., Sydney, 1984, ch. 4. The claims for protection of books finally culminated in the first modern copyright Act, the Statute of Anne 1709 (8 Anne c.19).

            56. See now Part IV, Copyright Act 1968 (Cth.).

            57. Copyright Amendment Act 1984.

            58. This protection is, in fact, accorded under the Copyright Act 1968, Part XIA (inserted by the Copyright Amendment Act 1989).

            59. Circuit Layouts Act 1989.

            60. Plant Variety Rights Act 1987. Legislation to the same effect was also passed in New Zealand in the same year: Plant Variety Rights Act 1987, as to which see also C. Brown, ‘Protecting plant varieties: developments in New Zealand’, Victoria University of Wellington Law Review, 18, 1988, p. 83.

            61. Trade Marks Amendment Act 1978 (Cth.).

            62. In the case of plant variety rights, see the debates in the Australian Parliament that occurred in 1982: Weekly Hansard Senate, 14, 14-15 September 1982, pp. 891–989, 979-988.

            63. In particular, see Copyright Act 1968, ss. 135P-135S (copying of broadcasts for educational purposes), 135ZZB-135ZE (photocopying) and 135ZZU-ZZV (blank tape levy).

            64. See, for example, Berne Convention for the Protection of Literary and Artistic Works 1886-1971, art. 6bis (the moral rights of authors); Paris Convention for the Protection of Industrial Property 1883-1967, art. 4ter (right of inventor to be mentioned as such in patent).

            65. Professor Vaver quotes the example of P.G. Wodehouse who publicly acknowledged that the suggestion for the main character in Love Among the Chickens came from another person and even gave that person a third share in the royalties from the first edition: Vaver, op.cit., p. 117, note 56. See further D. Jasen, P.G. Wodehouse: A Portrait of a Master, 1981, rev. ed., p. 37. Again, at the end of Doctor Faustus (1947), Thomas Mann inserted an author's note expressly attributing to Arnold Schonberg the twelve-note or row system described in chapter 22 of the book, stating that this was “in truth…the intellectual property” of the latter.

            66. For general background on these developments, see F.-K. Beier and G. Schricker (eds), GATT or WIPO? New Ways in the International Protection of Intellectual Property, IIC Studies in Industrial Property and Copyright Law No. 11, 1989. For an account of the losses through piracy to US manufacturers, see G.M. Hoffman, G.T. Marcou and C. Murray, ‘Commercial piracy of intellectual property’, (1989) 71 JPTOS 556. Though deferred for a period at a ministerial meeting in Brussels in December 1990, as at the time of revising this article (September 1991) the TRIPS negotiations were again under way and were expected to be concluded by the end of October 1991. The basis for these neogtiations is a draft text dated 22 November 1990. This is based essentially upon the provisions and standards of the major intellectual property conventions (Paris, Berne and Rome) and would not involve any substantial change to Australian law if adopted.

            67. H. Ullrich, ‘GATT industrial property protection, fair trade and development”, in Beier and Schricker, op. cit., pp. 127–59.

            68. Constitution, s. 109.

            69. This situation is now modified to some extent by cross-vesting legislation which confers jurisdiction on federal courts to deal with matters within the competence of State and Territorial courts: see Jurisdiction of Courts (Cross-Vesting) Act 1987 (Cth.).

            70. Plant Varieties Rights Act 1987.

            71. Circuit Layouts Act 1989.

            72. For example, the Olympic Insignia Protection Act 1987 (Cth.); the Advance Australia Logo Protection Act 1984 (Cth.).

            73. The trade marks power is a significant exception: see Attorney-General (NSW) v. Brewery Employees Union of NSW (1908) 6 CLR 469 where it was held, by a majority, that this not extend to the protection of workers’ marks.

            74. Constitutional Commission, Advisory Committee on the Distribution of Powers, Report, 6 June 1987, AGPS, Canberra, 1987, ch. 14.

            75. See art. 2(viii), WIPO Convention.

            76. See generally Berne Convention, art. 5; and Paris Convention, art. 2.

            77. See generally, S. Ricketson, The Berne Convention, op. cit, ch. 1.

            78. See generally articles 2 and 2bis.

            79. See, for example, articles 6bis, 8, 9, 11, 11bis, 12, 13 and 14.

            80. Articles 9, 10 and 10bis.

            81. Article 7.

            82. Articles of the Paris Convention that contain specific prescriptions include articles 4ter 5, 5ter, 5quater, 6bis, 6ter, 9 and 10.

            83. An exception is to be found in the case of the United States which still requires compliance with formalities as a condition for bringing infringement proceedings for breach of copyright in the case of American plaintiffs but not in the case of foreigners (because of the requirements of the Berne Convention): see Copyright Act 1976, s. 411(a) (added by the Berne Convention Implementation Act 1988).

            84. Berne Convention, art. 5(2).

            85. Article 7 (1).

            86. See generally articles 2, 6bis, 9, 11, 11bis, 13 and 14.

            87. Copyright Amendment Act 1984 (Cth.).

            88. See further on this general point, D. Vaver, ‘The national treatment requirements of the Berne and Universal Copyright Conventions: part one’, (1986) 17 IIC 577; ‘Part two’, (1986) 17 IIC 715.

            89. Article 9(1).

            90. Article 11(1).

            91. Article 11bis(1).

            92. Article 6bis.

            93. Public Lending Right Act 1985.

            94. See generally, Copyright Act 1968, Part VC.

            95. Section 135ZZZB.

            96. In addition, the constitutional validity of this legislation under the Australian Constitution is soon to be challenged in the High Court of Australia. For a report of some preliminary proceedings, see Australian Tape Manufacturers Association Ltd. v. Commonwealth of Australia [1989] AIPC 90-696.

            97. Notably in articles 9, 10 and 10bis.

            98. For example, article 13(1)(recording of musical works) and article 11bis(3) (broadcasting of works).

            99. See generally Constitution, s. 51(xxix).

            100. Plant Variety Rights Act 1987 (Cth.), s. 5(b). Section 5(a) also hangs the validity of the Act on the patents power under section 51(xviii) of the Commonwealth Constitution in so far as this is necessary.

            101. Circuit Layouts Act 1989, Schedule.

            102. Second Reading Speech of the Attorney General, reproduced in [1990] AIPC 34, 240.

            103. Although integrated circuits are also expressly excluded from the operation of the Designs Act 1906: Circuit Layouts Act 1989, Schedule.

            104. A good example is provided by the recent Federal Court decision in Dyason v. Autodesk Inc. [1990] AIPC 90-697.

            105. Patents Act 1990, Schedule 1, which retains the definition which stems originally from the English Statute of Monopolies 1624 (“any manner of new manufacture”).

            106. Patents Act 1990, ch. 12.

            107. See, for example, Copyright Amendment Bill 1991 (dealing with imported books).

            108. Attorney-General (UK) v Heinemann Publishers Australia Pty. Ltd. (1987) 10IPR 153.

            109. Circuit Layouts Act 1989, s. 23.

            110. See generally Copyright Act 1968, ss. 54-64.

            111. Pendleton M.. 1990. . ‘Character merchandising and the proper scope of intellectual property’. . Intellectual Property Journal . , : 242 McGill Law Journal

            112. Moorgate Tobacco Co. Ltd. v. Philip Morris Ltd. (1984) AIPC 90-141 at 39,003.

            113. See for example, the decision of the Full Federal Court of Australia to protect the Crocodile Dundee persona of Paul Hogan against unauthorised uses in advertisements: Pacific Dunlop v. Hogan [1989] AIPC 90-578. In the case of copyright, see further the cases cited in S. Ricketson, ‘Reaping without sowing…’, University of New South Wales Law Journal, Special Issue, 1984, p. 1.

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