1) Introduction
a) Philosophical Perspectives
i) The Natural Rights Perspective (Locke)
(1) Fairness/moral/distribution argument – people deserve the fruits of their efforts. By connecting your labor to something, you gain rights in it.
(2) Assuming that labor’s fruits are valuable and that laboring gives the laborer rights in this value, this would entitle the laborer only to the value he added, and not to the total value of the resulting product.
(3) Property rights are not always a fitting reward if the value of those rights is disproportional to the effort expended.
(4) Gordon – applies Locke’s provision that “as much and as good be left for others after appropriation.” This proviso poses a problem we see throughout the course: how to delimit the rights of a creator in the fact of claims by consumers and other members of the public at large.
(5) “If I use it, it’s mine.”
ii) The Personhood Perspective
(1) Radin – personhood is connected to property. People feel invested in the goods they created and they want acknowledgement for their creation.
(2) Hegel – a person is actualized through property. Creation vests moral rights in the person who created the item – this is a big deal in Europe and we will see it later in copyright.
(3) “There is something innate in my property that is part of myself.”
iii) The Utilitarian/Economic Incentive Perspective
(1) IP in US is fundamentally about incentives to invent and create. The economic justification lies not in rewarding people for their labor but in assuring that creators have adequate incentives to engage in creative activities.
(2) The Constitution and judicial decisions seem to emphasize incentive theory in justifying IP.
(a) The Constitution expressly conditions the grant of power in the patent and copyright clause on a particular end, namely to promote the progress of science and useful arts.
(3) Invention and creation require the investment of resources. In a private market economy, individuals will not invest in invention or creation unless the expected return from doing so exceeds the cost of doing so. To profit from a new idea or work of authorship, the creator must be able either to sell it to others for a price or to put it to some use that provides him with a comparative advantage in the market.
(4) Information is a “public good”; it may be consumed by many people without depletion, and it’s difficult to identify those who won’t pay for it and prevent them from using it.
(5) Economic Incentive Benefit: IP protection is necessary to encourage inventors, authors, etc. to invest in the process of creation. Without such protection, others could copy or imitate the work without incurring the costs and effort of creation, inhibiting the original creators from reaping a reasonable return on their investment.
(6) The downside: granting authors / inventors the right to exclude others from using their ideas limits the diffusion of those ideas and prevents other people from benefiting from them.
(a) In economic terms, IP rights prevent competition in sale of the work or in
lly be “known” to competitors or merely be “knowable” for the court to conclude that it is not secret.
(b) Many courts, like this one, follow the Restatement and protect information that could have been acquired properly, but was not. The problem wasn’t that D got the information, but how he got it. Underscores of fair competition?
(i) Note: even where the Restatement is followed, if information is generally known to the public or even within a specialized industry, it doesn’t get protection.
(c) The UTSA differs; information is not a trade secret if it is known or readily ascertainable by proper means.
(i) Note: CA has removed “readily ascertainable,” but does allow proof of “readily ascertainable” as a defense.
ii) Reasonable Efforts to Maintain Secrecy
(1) Rockwell Graphic Systems, Inc. v. DEV Industries, Inc.
(a) Holders of trade secrets must take reasonable precautions to keep the secrets confidential. Determining whether they have done so requires a balancing of costs and benefits. If trade secrets are protected only if their owners take extravagant, productivity-impairing measures to maintain their secrecy, the incentives to invest resources in discovering more efficient methods of production will be reduced.
