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International and Comparative Patent
University of California, Hastings School of Law
Beldiman, Dana

International and Comparative Intellectual Property Spring 2010 – Beldiman, Dana

Introduction
Week 1: Nature and attributes of IP, Economics, Justifications; History of IP.

Trends and Directions in Intellectual Property Law
· Challenges to IP law – primarily caused by technological development and globalization
· Some resulting developments
o International harmonization of IP law
o Widening gap between developed and developing countries
o Focus on enforcement

International harmonization of IP law
· Challenges: (1) Increased circulation of goods (2) Free circulation of information globally
· Legal uncertainty (uncertainty as to applicable law; discrepancy of substantive laws) impacts business
· Harmonization mechanisms – multilateral and bilateral treaties
o WTO, WIPO
o Regional agreements: EU, NAFTA
o Bilateral trade agreements

Widening gap between developed and developing countries
· Increased awareness of developing countries of importance of assets protected by IP laws
· Protectionist policies advocated by developed countries vs. openness, sharing advocated by developing countries
· Politicization of debate (e.g. access to medicines)

Focus on enforcement
· Factors promoting focus on enforcement
o Threat of piracy
o Pressure to monetize IP
o Remedies inadequate for business realities
o Slowness of substantive harmonization
· Examples of enforcement legislation
o Graduated response laws (three strikes) e.g. France, Sweden, UK.
o EU IP Enforcement Directive(2004/48/EC)
o ACTA (Anti Counterfeiting Trade Agreement) – multinational agreement among some industrialized countries, currently under negotiation

Comparative method
· Comparison of legal solutions reached by different jurisdictions
· Basic principles: Functionality, Factual orientation, Comprehensiveness
· Goal: Finding optimal legal solution for given circumstances

PRODUCT OF THE HUMAN MIND
· primary characteristic: INTANGIBLE
· Inventions, Creations, Branding

Characteristics of intangibles
· Non-rivalry
o Tangibles – become depleted as a result of use
o Intangibles – don’t deplete as a result of use (to the contrary – may augment/improve as a result of use)
· Non-excludability
o Tangibles
§ Allow exclusion of others from possession (both from practical and a legal standpoint)
o Intangibles
§ Do not generally allow exclusion of others from possession from a practical standpoint;
§ legal possession determined by society

“The IP Challenge” to Monetization
· Tangible products
o Excludablity and rivalry allow pricing at marginal cost + profit
· Intangible products
o Non-excludability and non-rivalry prevent formation of a market in a traditional sense; market “failure” or “inefficiency”

The legal regime governing IP rights
· Right to exclude third parties
o IP right entitles owner to stop third parties from using intellectual property
o Creates artificial scarcity (akin to tangibles)
o Ensures IP owner return of investment

Theories underlying IP legal regimes
· Natural rights theory
o Primal state is the “commons” (shared by all)
o Because man has a natural right to the fruits of his labor, such fruits can be withdrawn from the commons
§ As reward for labor (“just desert theory”)
§ Because increased value (“value added theory”)
§ (John Locke 17th century)
· Personality Theory
o Private property is crucial to the existence of fundamental notion of dignity and “personhood” or manifested as
§ Self-expression & Self-actualization
o Consequently, any creation of the mind is an inseparable part of the sphere of a creator’s personality
§ Based on Kantian and Hegelian philosophical principles
· Utilitarian (consequentialist) theory
o Focus on the benefit to the community
o Intellectual products are beneficial to community
o Grant of exclusivity is an incentive to creation and innovation (Jeremy Bentham 18th century)
· Concept of the “commons” – Both theories validate the “commons”
o Natural rights theory:
§ Right to withdraw fruit of labor from commons, but commons remains to be shared by all
o Utilitarian theory:
§ Intellectual product cannot be subject to property, but state can grant limited exclusivity as an incentive for innovation and creation (Thomas Jefferson)
o Tension with exclusive rights
o Remember the island

IP = Balance
· extent of exclusive rights granted to inventor/creator
VS.
· quantum of remaining available for free use (“commons”/public domain)

Week

GATT 1947 “General Agreement on Tariffs and Trade”
o Uruguay Round
· WTO “World Trade Organization” 1995
o Inclusion of services
o RIPS “Trade Related Aspects of Intellectual Property” in force since January 1, 1995
· Relation to WIPO convention:
o TRIPS requires compliance with Paris Convention and Berne Convention

Fundamental Principles
· National treatment
o Requires a member state to grant foreign nationals at least the same treatment it grants its own nationals
· Most favored nation treatment
o Requires a member state to extend to another country the same trade conditions it grants to any third country
o National treatment
· TRIPS Art. 2
o incorporates Paris, Berne, Rome and Integrated Circuits Treaty (which each have their own national treatment provision)
· TRIPS Art. 3.1
o no less favorable treatment to foreigners
o exceptions
§ judicial or admin procedures
§ compliance with laws that are consistent and not disguised restrictions on trade
§ National treatment vs. material reciprocity

National Treatment
· De jure v. de facto discrimination
o Facially neutral laws may result in operational discrimination, e.g.
§ Section 337 (Tariff Act of 1930) – ITC infringement proceedings favor US companies (GATT Panel Report of 1989, BISD 36S/345)
§ EU – geographical indication and designation of origin require local activity, and therefore discriminate against non-EU nationals
· unless there is reciprocity
· however: reciprocity is not a basis for compliance with national treatment requirement and

Policies underlying TRIPS
· Avoiding barrier to trade
o Trump territoriality of intellectual property laws
· Balance between
o long term interests, e.g. incentivizing innovation and creation AND
immediate national interests e.g. public health