The House passed the bill amending patent law on Friday, but the Senate has not yet acted on similar legislation introduced simultaneously with the House version, OMB has expressed opposition, and the President may well veto it link here and here. Some of the House rhetoric for and against the law bordered on the extreme, while behind the scene were beneficiaries like Microsoft, Cisco, and Intel and opponents like Caterpillar, Eli Lilley, and Proctor and Gamble. Its not clear which will prevail.

The bill would make several sensible changes: switching from first-to-invent to first-to-file patent grants like other countries; allow post-grant patent challenges for up to a year; allow third parties to introduce evidence against a patent grant; limit where a patent suit can be filed to cut down on jurisdiction-shopping; limit damages to reflect how much the patent violation contributes; and allow immediate appeals of court rulings while a case proceeds. Similar past bills have been introduced only to fail, and no one knowledgeable seems to be predicting the outcome this time either way.

A potentially important court decision discussed here. The First Amendment has been traditionally rejected as a defense against a copyright infringement. Although the door has only been opened a crack at this point, that may be about to change.

Since nearly all creative works build upon previous works on some level, I would think that the devastating effects on free speech would be obvious when you attempt to take a public domain work and try and reassert copyright protections on it. All of the subsequently created derivative works that were created during the public domain window would presumably have to be repressed and/or destroyed.

It is a well known secret that California-based burger chain In-N-Out has a 'secret' menu that is not displayed or advertised at any of their stores. It allows people to order items that are not found on any of their limited menus.

When you order a 3x3 burger, or "Animal Style" burger, In-N-Out service people will know what you are talking about.

However, I have a problem with a judge ruling that such terms are trademarks owned by In-N-Out. [PDF alert. Hat-tip Courthousenews.com]

Even if In-N-Out actually registered a trademark in such terms, a minimum requirement for trademark protection demands that the mark actually be used in commerce. If you deliberately hide a mark from the public, you should lose trademark protections. (And no, simply referring to the terms on a company website should not count. If you don't use the mark on the product or place of business, there is no mark to protect.)

Although I recognize the legitimacy of trademarks to protect against actual consumer confusion in the marketplace, I think the judge blew it on this one.

Informal "protection" of the incentive to innovate in magic tricks is discussed in this paper . No IP monopoly required.

The pointer is from Tyler Cowen at marginal revolution .

Yes, I am working on a trick to levitate the Patent and Trademark Office. I'll let a real magician, like David Copperfield make it disappear.

Maybe more innovative and with less work for the lawyers.

The Council of Fashion Designers of America is still lobbying Congress to extend the copyright monopoly to the fashion industry, as this story details .

I wonder who Anna Sui (she is quoted in the article) was copying when she was a young designer just starting out.

We have a new contender in the dispute over who originated the idea behind the website, Facebook. John Markoff reports in the NYTimes link here that Aaron Greenspan, while a student at Harvard, had the idea first, created a web service called houseSystem, and labeled a new feature of it as "the Face Book".

While he may have got the idea and/or put it into practice first, he seems to have no real claim to owning any intellectual property that would be recognized by a court. All of those claiming the idea knew each other and apparently worked together part of the time, but just as William's post of 08/12/2007 suggested, the legal claims remain vanishingly weak. Still, who knows what a smart lawyer can dig up.

AdvanceMe, a Georgia-based cash advance business, tried to muscle in on the business of AmeriMerchant, filing the obligatory patent infringement case. David Goldin, the president of AmeriMerchant, found prior art from the 1980s and 1990s. AdvanceMe's patent was declared invalid because it failed the test for obviousness. Here is the story .

Speaking of small businesses, Gerry Elman, an IP lawyer, claims that "In the past, they have relied on the patent system to become big businesses," he said. "But now, the patent system is being gutted on the strength of lobbying by the information technology industry. Big businesses will be able to copy innovation with impunity and thumb their noses at the inventions of the little guy."

Did Wal-Mart and Microsoft rely on patents to become big businesses? Did Google vacate a college dorm room shared by two guys to challenge Microsoft on the strength of its patents? Did McDonald's outgrow the local burger stores because Ray Croc had a patent on burgers? No, no, no, and no.

Mr. Elman ought to redirect his reading from legal briefs to business history. Some relevant history can be found here .

This is really wierd.

Hitt, Greg. 2007. "Patent System's Revamp Hits Wall: Globalization Fears Stall Momentum in Congress." Wall Street Journal (27 August): p. A 3. "A bipartisan effort in Congress to overhaul the patent system -- a priority for some of the nation's biggest technology companies -- is hitting resistance because of concerns the U.S. might be exposed to greater foreign competition. Patent overhaul appeared to be on a fast track earlier this summer. But plans for a quick vote got derailed last month after the AFL-CIO entered the debate, warning that innovation -- and union-backed manufacturing jobs -- might be at risk if the changes were adopted. The union has considerable clout in the Democratic Congress and expressed concerns with provisions that would expose patents to expanded challenges and might limit damages for infringement. "At a time when the Chinese government is constantly being challenged to live up to its intellectual-property obligations, we do not want to take actions that may weaken ours," the AFL-CIO's legislative director, William Samuel, said in the pointed missive that was circulated on Capitol Hill."

Michael Perelman

Dana Thomas goes after high-fashion counterfeit handbag producers and sellers link here. "As soon as a handbag hits big, counterfeiters around the globe churn out fake versions by the thousands. And they have no trouble selling them. Shoppers descend on Canal Street in New York, Santee Alley in Los Angeles and flea markets and purse parties around the country to pick up knockoffs for one-tenth the legitimate bag's retail cost, then pass them off as real."

He argues that most people think the counterfeit trade is harmless but it 1) is run by criminal syndicates also in drugs and child prostitution, 2) "may have helped finance the 1983 World Trade Center bombing," and 3) is made by child labor. All bad. His solution is greater enforcement and persuading people not the buy the knock-offs.

Thomas doesn't seem to think that most buyers are fooled by the counterfeit into thinking it is the real thing. The price difference and the seller's facilities attest to that. Enforcement doesn't seem to work and it is very expensive trying to catch all those little entrepreneurs. So we need to persuade the public not to buy.

In favor of the counterfeit trade is an argument that it actually helps the "legitimate" industry. David points out that the fashion industry would be greatly harmed by fashion patents (posted on 08/23/2007 07:49 AM at http://www.againstmonopoly.org/) Wouldn't a consumer boycott or over active enforcement of trade marks in handbags do the same thing by removing the stimulus of competition to improve designs and create new design trends?

Michelle Slatalla has a piece on saving money when buying college textbooks link here. She recognizes their high cost for college students ($700-1000 per year) and suggests going to the internet. She notes that there are lots of sites but up to now, there has been no single way to find the best deal. That has changed with the creation of Bookfind.com that checks most suppliers. She also suggests getting an early start as the market in used books has gotten more competitive.

All this is good advice so long as texts are so expensive, but small potatoes when the alternative is considered. Students and parents need to start putting pressure on schools to put the texts on the web, as David so strongly advocates. That is the solution that makes texts cheap and easy to update at the will of the author and in response to evolving definitions of generally accepted truth/wisdom.