I. Protection of Ideas
A. INS v. Associated Press (S.Ct. 1918)
1. Holding:
a. Pitney: You cannot reap where you have not sown. News has enough attributes of property to determine that competitor’s misappropriation of it is unfair competition.
i. Problem: Broad reading would make much competition unfair.
b. Holmes: The wrong is in INS not disclosing its source. Would have barred publication unless express credit given (functionally the same remedy as Pitney).
c. Brandeis: Law sanctions free access to others’ IP, with carefully crafted exceptions, i.e., patent law. Doesn’t want to create general property right in the news – worried about monopoly effect.
2. Thoughts: Opposing approaches:
a. Pitney – news shouldn’t be copied because it will destroy company’s profitability.
b. Brandeis – news is in the public domain and as such should be freely available.
B. Sears v. Stiffel (S.Ct. 1964)
1. Holding: States may not prohibit copying unpatented/uncopyrighted articles through their state unfair competition laws (Black v. hostile to IP).
2. Thoughts: Difficult to draw a line between unfair competition (palming one’s products off as a competitor’s) and holding of this case – that states may not protect unpatented articles.
3. Is there any room left for state protection?
a. Yes – trade-dress and trademark protection.
C. Compco v. Day-Brite Lighting (S.Ct. 1964) (argued & decided same day as Sears)
1. Holding: When an article is unprotected by patent/copyright, state law may not forbid copying of the article (No fed. prot. – copy at will).
a. But – states can prohibit deceptive copying. Has to be narrowly-tailored. How can this be done?
b. Harlan – States can reasonably restrict copying that seems to be done to palm off one’s goods as another’s. Have to look at intent?
2. Thoughts: After Sears & Compco, fed. pre-emption looked big, but the courts have retreated somewhat. Good law, but principle not as robust as in 1964.
D. Van Rensselaer v. General Motors (E.D. MI 1962)
1. Complaint: K express/implied and quasi-K
2. Holding:
a. Express/implied K: doctrinally, GM never tendered any offer
b. Quasi-K: No fid. rel.: GM protected by warning in letter. GM pamphlet sets them up for win – confidentiality, patent law.
E. Protection of Ideas Summary
1. Prot. of ideas isn’t favored in fed. statutory law nor in state case law schemes.
2. Brandeis – ideas should be as free as the air.
3. Fed. & state IP law: ideas are not patentable subj. material.
4. Why is the law so suspicious of ideas?
a. Ideas are abundant, difficult to define, can occur to many people.
b. Lots of prob. w/protecting ideas, but costs to not protecting ideas.
5. What legal mechanisms can we use to facilitate transactions between people that have ideas?
a. Entertainment indust. – K to protect ideas
b. Cts. Reluctant to impose obligation for freely disclosed idea.
6. Why wouldn’t someone want to accept an offer of an idea?
a. Org. wouldn’t want to pay royalties that is free to everyone else because it is unpatentable.
II. Trade Secrets
A. Generally
1. Less disfavored than protection of ideas. Combination of tort, K, property.
2. Distinguish b/w TS and actual secrecy – TS is less than absolutely secret b/c some things about the secret have to be revealed (to employees at least).
3. State law – varies from state to state.
4. Advantages of TS:
a. Subj. matter very broad – any material used in operation of business which can confer an economic advantage.
b. Duration – theoretically infinite – lasts as long as secrecy maintained (as a practical matter doesn’t last very long).
5. Disadvantages of TS
a. Scope of protection – limited to wrongdoers (patent includes innocent infringers).
b. Potential for loss of secrecy through enforcement (limited second strike capabilities).
c. Litigation & employee mobility can cause you to lose secrecy.
d. TS owner can be excluded from practicing secret if competitor gets patent
B. E.I. duPont de Nemours v. Christopher (5th Cir. 1970)
1. Rule: Can reverse engineer or independently research competitor’s secret process, but cannot discover it without permission at a time when competitor is taking reasonable precautions to maintain its secrecy.
2. Questions:
a. Is the expense what determines whether you have an obligation to preserve a trade secret?
b. Is cost-effectiveness the way to go as far as analytical tool?
c. Would a roof be a cost-effective measure?
d. What constitutes reasonable precautions to maintain secrecy?
i. Roof over unfinished plant – unreasonable.
e. Would access to an employee manual be OK way to get TS?
C. Litton v. Sundstrand (Fed. Cir. 1984)
1. Typical case – shows the advantages of being a π in TS litigation (speed, surprise, can get considerable relief from a TRO even if preliminary injunction is lost)
2. Sundstrand had hired some former Litton employees (typical case)
3. Question: Was Litton denied PI because it couldn’t produce trade secrets?
D. Warner-Lambert v. Rey
alidity (but issued patents enjoy a presumption of validity).
E. Globalization.
1. Paris Convention of 1883 – introduced one year rule of priority (patent apps filed w/in one year get same date as original filing)
2. PCT/EPC in 1970’s – PCT establishes international application process.
a. Look for prior art. Still have to prosecute multiple nat’l apps.
b. EPC – bundles nat’l patents of 20 European countries.
3. TRIPS – requires signatory nations to harmonize patent law.
a. 20 year expiry term.
b. No SM restrictions
c. Exclusive right to import
d. Nonobviousness and utility requirements.
IV. Patent Eligibility
A. Relevant Statutes
1. § 101. Inventions patentable – Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.
2. § 100. Definitions – When used in this title unless the context otherwise indicates–
(a) The term “invention” means invention or discovery.(b) The term “process” means process, art or method, and includes a new use of a known process, machine, manufacture, composition of matter, or material.
B. Four categories of patentable subject matter:
1. process, machine, manufacture, composition of matter
C. Importance of categorical SM exclusions
1. Have waned but things are being excluded on amount of work.
2. Sliding scale – smaller the set of SM, harder it is to patent but the easier it is to have rules to fit the SM. Promotes uniformity, one-size-fits-all patent sys.
D. Questions about patentable subject matter:
1. Why might we want to exclude anything from patent protection if it is novel but not in the four categories above?
a. Theoretical/abstract ideas – NO, but application of idea – YES
b. Don’t want to allow patenting of E=MC2 (fund. law of physics)
c. But, DNA (fund. biological building block) is patentable.
What are we trying to achieve with the patent system
