Intellectual property rights

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                                                                     C O N T E N T S


                                                     INTRODUC TION
What Is Intellectual Property? ............................................................................................... 2

                                      I. INTERNATIONAL PERSPEC TIVES
Why Protecting Intellectual Property Rights Matters ................................................... 10
A Short Guide to International IPR Treaties ..................................................................... 16
Intellectual Property Training and Technical Assistance Programs .......................... 26
Jordan Benefits From Intellectual Property Reforms...................................................... 28
A Message From Jackie Chan: “Fakes Cost More”........................................................... 31
Taking Action: How Countries Are Fighting IPR Crime .............................................. 32
e U.S. Approach: Traditional Knowledge, Genetic Resources, and Folklore ........ 40

                                               II. LAWS IN EVOLUTION
e Challenge of Copyright in the Digital Age ................................................................ 50
What Is “Fair Use”? ................................................................................................................ 59
e Importance of the Public Domain............................................................................... 60
Roundtable: Enforcement, a Priority for All Countries................................................. 62
New Tools for Fighting Optical Disc Piracy ..................................................................... 70

                                              III. ISSUES BY INDUSTRY
A Trade Association at Work ............................................................................................... 74
Intellectual Property Rights and the Pharmaceutical Industry.................................... 78
e Cost of Developing a New Drug .................................................................................. 82
Malaria: Partnering to Find a Cure.................................................................................... 84
Protecting Trademarks on the Internet ............................................................................. 86

                                                        IV. SOURCES
Glossary of IP Terms.............................................................................................................. 90
Sources of Information on IP .............................................................................................. 100
Additional Readings on IP ................................................................................................... 104
Kids’ Corner: Educational Materials for Children and Young Adults........................ 107
                      What Is
             Intellectual
        Property ?
                                                                  By Thomas G. Field Jr.
INTRODUC TION




                THE BOTTOM LINE                                   tion and original expressions of creative indi-


                
                                                                  viduals known as intellectual property (IP)?
                “         um and Coca-Cola,” perhaps the          They do so because they know safeguard-
                          best-known Calypso song of all          ing these property rights fosters economic
                time, became a big hit for the Andrews            growth, provides incentives for technologi-
                Sisters in the 1940s. It also sparked a fa-       cal innovation, and attracts investment that
                mous U.S. court case brought to establish         will create new jobs and opportunities for all
                the authorship of Trinidad musician Lionel        their citizens. The World Bank’s Global Eco-
                Belasco, who had written the song several de-     nomic Prospects Report for 2002 confirmed
                cades earlier under the title “L’Année Passée.”   the growing importance of intellectual prop-
                e lawyer acting for the man who published        erty for today’s globalized economies, find-
                Belasco’s original score proved to the court      ing that “across the range of income levels,
                that “Rum and Coca-Cola” was the Creole           intellectual property rights (IPR) are associ-
                musician’s work and no one else’s.                ated with greater trade and foreign direct in-
                   Belasco won recognition for his creation       vestment flows, which in turn translate into
                and also received compensation for the            faster rates of economic growth.”
                unauthorized use of his work because the             In the United States alone, for example,
                United States has laws that protect the intel-    studies in the past decade have estimated
                lectual property of talented individuals like     that over 50 percent of U.S. exports now de-
                him and enforces those laws against those         pend on some form of intellectual property
                who would violate them. If his publisher had      protection, compared to less then 10 percent
                sued in a country with weak or non-existent       50 years ago.
                protections, Belasco’s search for recognition        Intellectually or artistically gifted people
                and compensation would not have had a             have the right to prevent the unauthorized
                happy ending.                                     use or sale of their creations, just the same
                                                                  as owners of physical property, such as cars,
                WHAT IS INTELLECTUAL PROPERTY?                    buildings, and stores. Yet, compared to mak-


                
                                                                  ers of chairs, refrigerators, and other tan-
                               hy do countries such as the        gible goods, people whose work is essentially
                               United States, Japan, and The      intangible face more difficulties in earning
                Netherlands protect inventions; literary and      a living if their claim to their creations is
                artistic works; and symbols, images, names,       not respected. Artists, authors, inventors,
                and designs used in commerce: the informa-        and others unable to rely on locks and fences

                2
                                                                                    Left, the cover for the
                                                                                    original sheet music
                                                                                    for “Rum and Coca-
                                                                                    Cola,” before Lionel
                                                                                    Belasco’s publisher
                                                                                    won his lawsuit.
                                                                                    Below, intellectual
                                                                                    property symbols in
                                                                                    the United States:
                                                                                    copyright (©),
                                                                                    registered trademark
                                                                                    ®
                                                                                    ( ), and trademark
                                                                                    ™
                                                                                    ( ).




to protect their work turn to IP rights to      years ago, India was losing
keep others from harvesting the fruits of       the battle to retain the
their labor.                                    best and the brightest of
   Beyond making it possible for innovators     its engineers and com-
and artists to be compensated fairly and for    puter scientists. e lack
countries to attract foreign investment and     of protection for their intellectual property
technology, intellectual property protection    was forcing those scientists and technicians
is critical to consumers. Most advances in      to emigrate to countries where their hard
transportation, communications, agricul-        work could be protected and kept safe from
ture, and health care would not exist without   unfair exploitation by competitors seeking
strong IP support.                              easy advantages. e Indian Parliament
   Increased recognition and support of         finally passed a law in 1999 to protect the
intellectual property also has much to do       intellectual creations of its computer sci-
with the rapidly rising standards of living     entists. e result: a burgeoning high-tech
in countries like China and India. Just a few   industry producing some of the world’s

                                                                                             3
most advanced software and employing              ing a system of copyright, and this system
thousands of workers who might otherwise          is administered by the Library of Congress’
have left India for more lucrative parts of       Copyright Office.
the world.                                           e U.S. Copyright Office serves as a place
                                                  where claims to copyright are registered and
KEY FORMS OF INTELLECTUAL                         where documents relating to copyright may
PROPERTY                                          be recorded when the requirements of the



                                                  U.S. copyright law are met. For all works,
        he key forms of intellectual property     however — even foreign ones — prompt U.S.
        are patents, copyrights, trademarks,      registration confers important remedial ad-
and trade secrets. Because intellectual prop-     vantages at little cost.
erty shares many of the characteristics of           Ready access to those remedies has
real and personal property, associated rights     spawned enormous U.S. entertainment in-
permit intellectual property to be treated as     dustries. According to the 2004 edition of
an asset that can be bought, sold, licensed,      Copyright Industries in the U.S. Economy,
or even given away at no cost. IP laws enable     by Stephen Siwek, the “core” U.S. copyright
owners, inventors, and creators to protect        industries accounted for 6 percent of the U.S.
their property from unauthorized uses.            Gross Domestic Product, or $626.2 billion, in
                                                  2002. e report defines “core” copyright in-
Copyright                                         dustries as newspapers, book publishing, re-
   Copyright is a legal term describing the       cording, music, periodicals, motion pictures,
economic rights given to creators of liter-       radio and TV broadcasts, and computer
ary and artistic works, including the right to    software. In the 2004 report, bookstores and
reproduce the work, to make copies, and to        newsstands were added to “core” industries.
perform or display the work publicly. Copy-          Only an author or those deriving their
rights offer essentially the only protection      rights through the author — a publisher, for
for music, fi lms, novels, poems, architecture,   instance — can rightfully claim copyright.
and other works of cultural value. As artists     Regardless of who holds them, however,
and creators have developed new forms of          rights are limited. In the United States, for
expression, these categories have expanded        example, strangers may reproduce a portion
to include them. Computer programs and            of works for purposes of scholarship, criti-
sound recordings are now protected, too.          cism, news reporting, or teaching. Similar
   Copyrights also endure much longer than        “fair use” provisions exist in other countries,
some other forms of IP. e Berne Conven-          too. e scope of this exception is discussed
tion, the 1886 international agreement under      in more detail in the article “What Is ‘Fair
which signatory states recognize each other’s     Use’?” on page 59.
copyrighted works, mandates that the period          Copyright protects arrangements of facts,
of copyright protection cover the life of the     but it does not cover newly collected facts as
author plus 50 years. Under the Berne Con-        such. Moreover, copyright does not protect
vention, literary, artistic, and other qualify-   new ideas and processes; they may be pro-
ing works are protected by copyright as soon      tected, if at all, by patents.
as they exist. No formal registration is need-
ed to protect them in the countries party to      Patents
that convention.                                     One might say that a patent is a contract
   However, the Berne Convention permits          between society as a whole and an individual
copyright to be conditioned, as it is in the      inventor. Under the terms of this social con-
United States, upon a work having been            tract, the inventor is given the exclusive right
created in fi xed form. Also, many countries      to prevent others from making, using, and
have national copyright centers to admin-         selling a patented invention for a fi xed period
ister their copyright systems. In the United      of time — in most countries, for up to 20
States, for example, the Constitution gives       years — in return for the inventor’s disclos-
Congress the power to enact laws establish-       ing the details of the invention to the public.

4
The works of composers, writers, and choreographers —
such as Martha Graham, the renowned American dancer
— are protected by copyright laws. Here, her company
performs one of her dances, Night Journey.




                                                            A worker hangs a seven-story Spider-Man on the side of
                                                            a hotel in Las Vegas, Nevada. Copyright laws protect this
                                                            superhero character, although the name Spider-Man™ now is
Legendary blues master B.B. King, left, plays his guitar.   also a trademark of Marvel Comics.
His recorded performances are copyrighted, as is most of
the music he plays.




This newspaper reader in Belgrade, Serbia and               Chairman of Open Port Technology, Inc., Randy Storch
Montenegro, can choose among a large number of              holds a patent granted to his company for least-cost routing
newspapers and magazines, all of which are covered by       (LCR) technology. His company says LCR reduces the cost of
the copyright laws of most countries.                       routing messages over the Internet.


                                                                                                           5
       Many products would not exist without                   Trade Secrets
    patent protection, especially those that re-                  Any information that may be used in the
    quire substantial investments but, once sold,              operation of a business and that is sufficiently
    can be easily duplicated by competitors. At                valuable to afford an actual or potential eco-
    least since 1474, when first granted by the                nomic advantage is considered a trade secret.
    Republic of Venice, patent protection has en-              Examples of trade secrets can be formulas for
    couraged the development and distribution                  products, such as the formula for Coca-Cola;
    of new technologies.                                       compilations of information that provide
       When patents are not available, technol-                a business with a competitive advantage,
    ogy is closely held. If inventors had to rely              such as a database listing customers; and
    on secrecy to protect their inventions, much               even advertising strategies and distribution
    important but undisclosed information often                processes.
    would die with them.                                          Unlike patents, trade secrets are protected
       Patents, however, are not easily obtained.              for a theoretically unlimited period of time,
    Patent rights are granted not for vague ideas              and without any procedural formalities.
    but for carefully tailored claims. To avoid                Trade secrets, however, tend to escape, and
    protecting technology already available, or                protection is not free. Under the best of
    within easy reach of ordinary artisans, those              circumstances, firms must restrict access
    claims are examined by experts. Because                    to premises and documents, educate key
    patent claims vary as much in value as the                 employees and government inspectors, and
    technologies they protect, applicants must                 closely monitor publications and trade show
    negotiate claims of appropriate defensible                 presentations. Although secrecy is expensive
    scope. (Defensible scope means that appli-                 to maintain, large companies rely heavily on
    cants must be careful in setting the bound-                it when patents are not available. e larger
    aries of what their invention consists of and              the company, the more it needs legal protec-
    what can be protected from infringement                    tion for its commercial secrets.
    in their invention.) is often takes two or                   Companies that cannot rely on a country’s
    more years and is expensive.                               courts to help preserve important secrets
                                                               must rely on self-help. ey may, for example,
                                                               severely limit the number of people with ac-
                                                               cess to competitively important information.
                                                               More likely, information needed for critical




Above, the California Institute of Technology makes money out of
patents for the rovers it created for NASA by licensing their image
  to toymaker Lego for commercial use. Right, Arizona Cardinals
    football team’s running back Marcel Shipp displays his team’s
      trademark-protected new logo on a helmet, hat, and fleece.


    6
operations will be shared only if adequate        for example, the dubious quality of counter-
trade secret protection is available. If not,     feit and fake drugs and their potential for
few, if any, local employees will be trained      causing great harm, if not death, to unsus-
beyond the level necessary to perform essen-      pecting users.
tially unskilled assembly tasks.                      Trademark protection is also widespread
                                                  in sports, estimated to account for 2.5 per-
Trademarks                                        cent of world trade. Much support for the
   Trademarks are commercial source indi-         Olympics, for example, derives not from
cators, distinctive signs that identify certain   copyrighted broadcasts, but from merchan-
goods or services produced or provided by         dising rights protected by trademarks.
a specific person or enterprise. In villages,         At an earlier time, purchasers of prod-
cobblers’ names used to serve that function.      ucts bearing the names or logos of famous
Trademarks are especially important when          sports teams or events would probably
consumers and producers are far away from         have assumed no connection, much less an
one another. Children ask for Barbie dolls,       endorsement of quality between the sports
Lego building blocks, and Hot Wheels toy          team and, say, the baseball cap bearing the
cars. Some adults dream of Ferrari automo-        team’s symbol. Increasingly, however, con-
biles, but more can afford to buy Toyota or       sumers assume both. As early as 1993, U.S.
Honda brands. ese consumers need trade-          baseball teams alone licensed uses of their
marks to seek or avoid the goods and services     trademarks on $2.5 billion in goods.
of particular firms.
   roughout most of the world, trade-            Other Forms of Intellectual Property
marks must be registered to be enforceable,          Within the basic forms of intellectual
and registrations must be renewed. Yet,           property, many variations and special kinds
while copyrights and patents eventually           of protection are possible. Geographical indi-
expire, names of companies that treat cus-        cations, which identify a good as originating
tomers well become increasingly valuable          in a locality where a given quality, reputation,
over time. If trademark rights were to expire,    or other characteristic of the good is essen-
consumers would be collectively harmed as         tially attributable to its geographic origin,
much as owners. Imagine the confusion if          are an example. Some countries separately
unaffi liated firms could sell products under     protect geographical indications for goods
another company’s trademark. And consider,        such as French cognac or Scotch whiskey. In




                                                      Above, although the ingredients in these soft drinks
                                                      are public knowledge, the “recipes” for making Pepsi
                                                      or Coke constitute trade secrets closely held by the
                                                      Coca-Cola and Pepsi companies. Left, Barbie dolls,
                                                      here dressed as astronauts, have been popular with
                                                      young girls for decades. Barbie™ is one of toymaker
                                                      Mattel‘s most successful trademarks.



                                                                                                   7
       the United States, geographical indications           right. Moreover, the United States offers two
       are protected with collective marks and cer-          specific types of statutory protection for new
       tification marks. ey are treated as a subset         plant varieties, as well as protection unique
       of trademarks to prevent consumer confu-              to boat hulls and computer chips. Designs
       sion, as well as to protect business interests.       that serve no purpose other than to indicate
       Similarly, in the United States, famous ath-          commercial source may be protected under
       letes and performers are able to license or to        trademark law.
       forbid fraudulent or misleading commercial
       uses of their names and images. Based on              EMERGING IP ISSUES: DOMAIN NAMES


                                                             
       trademarks or related, still-developing rights
       of publicity, well-known figures often earn                   he need for new forms of IP some-
       more from endorsements than from activi-                      times arises, and the assignment of
       ties underlying their fame.                           Internet addresses has posed particularly
           Also, the ornamental or aesthetic aspects         difficult issues. Like telephone numbers,
       of electrical appliances, chairs, and the like        Internet addresses have the basic form
       are protected in a variety of ways. Many in-          “123.456.123.” If that were the end of it, there
       dustrial designs are protected in the United          would be no problem.
       States, Japan, and South Korea as design                  Because useful directories are so far un-
       patents. Other countries — notably in Eu-             available, however, most addresses also have
       rope — offer copyright-like protection. In the        an alphanumeric form such as “BBC.uk”,
       United States, works having purely aesthetic          “BBC.com”, or “yale.edu”. e unique part
       appeal, such as jewelry or patterns that may          of each (“BBC” or “Yale”) is registered as a
       be applied to fabrics, are protected by copy-         “domain name.” Just as postal addresses
                                                             indicate unique physical locations, do-
                                                             main names indicate unique locations in
                                                             “cyberspace.”
                                                                 Various entities control the registration,
                                                             renewal, and transfer of domain names
                                                             depending on the final portion of any al-
                                                             phanumeric address. Addresses ending with
                                                             country codes “fr” or “uk” are subject to the
                                                             laws of France and the United Kingdom,
                                                             respectively. ose ending with “edu” are
                                                             controlled, under agreement with the U.S.
                                                             Department of Commerce, by Educause, a
                                                             non-profit U.S. organization. ose ending
                                                             with “com” and a few other terms have a
                                                             global reach. ey are governed by rules es-
                                                             tablished by the Internet Corporation for As-
                                                             signed Names and Numbers (ICANN), also
                                                             under agreement with the U.S. Department
                                                             of Commerce.
                                                                 Because domain names often comprise
                                                             celebrities’ or companies’ names, trade-
                                                             marks, and the like, few people regard them
                                                             as merely addresses. In the early days of the
                                                             Internet, individuals quick to understand
                                                             this registered many “.com” domain names
Bangalore Bio 2005, a three-day biotechnology trade show
featuring discoveries by Indian scientists and business      for sale at hefty premiums. For example, a
opportunities. India’s increased support of IPR has helped   tourist agency registered “Barcelona.com” as
lift the country’s living standards.                         its domain name, a move denounced by the
                                                             Spanish city of Barcelona, which went on to

       8
establish its superior claim to that domain            Although effective IP enforcement serves
name. Holders of domain names intending            important economic ends, it also promotes
to suggest unauthorized affi liations were         a variety of other common social goals. By
condemned as “cybersquatters.” Procedures          providing the opportunity for pharmaceu-
were soon established to prevent misleading        tical companies to recoup investments in
registrations or have ownership transferred        research, enforcement of IP rights can help
to others with superior claims of legitimacy.      eliminate serious health risks. Besides en-
    Under the most favorable circumstances,        couraging the creation of new technologies,
however, time and money must be spent to           patent and trademark laws are useful as well
have a domain name transferred. Also, many         to prevent serious, well-documented harm
addresses may falsely suggest sponsorship          posed by counterfeit goods. For example,
by the same person or firm. Experience has         those who consciously palm off medical
shown that cancelling them is insufficient if      products under false labels are apt to be
others can then re-register. But maintaining       unconcerned about whether their goods are
registrations of possibly hundreds of spuri-       worthless or toxic to unsuspecting users.
ous addresses is a major waste of money.               Local cultures are also at stake. Works by
    Such problems have been alleviated by          local artists, authors, musicians, and others
imposing significant civil and criminal pen-       are often supported in ways that are relatively
alties on cybersquatters. Still, some remain       independent of the need for private risk capi-
beyond reach, and further measures will be         tal. Yet, even when that is true, they are often
needed to halt activities that often mislead       displaced by the illegal sale of cheap or free
computer users throughout the world.               music, movies, and books originating abroad,
                                                   works that would cost far more if copyrights
IP MATTERS, VERY MUCH                              in such works were locally enforced.



                                                       People everywhere who are concerned
           lthough the first international         about cultural growth and preservation, as
           treaties protecting intellectual        well as improved health and economic well-
property rights — the Paris Convention for         being, should understand how IP protection
the Protection of Industrial Property and          serves those ends. 
the Berne Convention for the Protection of
Literary and Artistic Works — were reached
in the 1880s, coordination across countries
for IPR protection remained inadequate until       Professor Thomas G. Field Jr. helped launch the
recently.                                          Franklin Pierce Law Center in New Hampshire in
   Intellectual property rights were first in-     1973. He credits much of his general understanding
cluded in the Uruguay Round negotiations of        of intellectual property to students who attend from
                                                   abroad. The casebook, Introduction to Intellectual
the General Agreement on Tariffs and Trade
                                                   Property, is among his more recent publications. For
(GATT), 1986-1993, with the Agreement              more information, see: http://www.piercelaw.edu/
on Trade-Related Aspects of Intellectual           tfield/tgf.htm.
Property Rights (TRIPS). TRIPS requires
signatories to make it easier for their citizens
and others to obtain and enforce IP rights,
although it does not deal with domain names
as such.
   TRIPS member countries should be aware
that if their IP laws seem, on paper, to support
innovation and protect IP, but in practice do
not, they generate little besides cynicism.
Conversely, cost-effective means to secure,
transfer, and enforce IP rights boost cultural
development and standards of living, as well
as promote public health and safety.

                                                                                                          9
                                               Why Protecting
                             Intellectual
SECTION I: INTERNATIONAL PERSPECTIVES


                         Property Rights Matters
                                                                                           By E. Anthony Wayne




                                             ntellectual property issues are getting
                                              more and more attention these days.
                                        Unfortunately, far too often the issues are
                                        framed in such a way as to highlight con-
                                                                                           power . . . to promote the progress of science
                                                                                           and useful arts, by securing for limited times
                                                                                           to authors and inventors the exclusive right
                                                                                           to their respective writings and discoveries.”
                                        troversy and polarize debate. In fact, there is        e essential idea behind a copyright
                                        much about intellectual property protection        is simple: Artists and creators should be
                                        on which everyone can agree.                       able to enjoy the fruits of their labor for a
                                           To arrive at a fuller understanding of the      specified time period, after which the mate-
                                        issue, it is worth spending some time consid-      rial becomes available for public use. Society
                                        ering how intellectual property rights (IPR)       benefits because this incentive to create will
                                        developed and what role they play in achiev-       yield a rich and varied cultural menu for its
                                        ing widely shared objectives. What comes           citizens. Indeed, one can say that copyright
                                        out of such an examination is the conclusion       protection is a necessary ingredient for en-
                                        that intellectual property protection is a vital   suring cultural wealth in our societies.
                                        part of social, cultural, and economic devel-          But if copyright protection is important for
                                        opment. Protection of intellectual property        reaching cultural objectives, then it is equally
                                        rights alone will not necessarily bring about      true that the theft of these copyrighted goods
                                        this development. But it is hard to imagine        — that is, the pirating of cultural works — is
                                        that a country could ever reach these goals in     a threat to the creative sectors in our societ-
                                        the absence of such protection.                    ies. Many international institutions, such
                                                                                           as the World Bank, the World Intellectual
                                        COPYRIGHTS AND CULTURE                             Property Organization (WIPO), and even the


                                        
                                                                                           United Nations Educational, Scientific, and
                                                       e can credit 17th century           Cultural Organization (UNESCO), recognize
                                                       England with the concept of a       this link. In fact, if you visit UNESCO’s web
                                        “copy right,” a law that protects the creative     site (http://www.unesco.org), you will find an
                                        products of authors, artists, singers, and,        entire section devoted to the issue and a list
                                        to reflect developments since the 1600s,           of programs and publications that explain the
                                        filmmakers and software developers. This           benefits of copyright to educational, scien-
                                        concept even has been enshrined in the             tific, and cultural policies and provide help in
                                        U.S. Constitution, whose Article I, Section        finding ways to fight piracy.
                                        8, Clause 8 reads, “the Congress shall have


                                        10
                                                       An illustration by Theodore R. Davis in Harper’s Weekly magazine
                                                       (July 10, 1869) shows examiners at work at the U.S. Patent Office
                                                       in Washington, D.C.




Today’s bicycle manufacturers build on
the patented work of several 19th century
inventors. Here, a tobacco label showing a man
riding a “velocipede,” the French term for a
precursor of the bicycle in the late 18th century.




          Policemen display some of the hundreds
           of fake works of art they seized in Milan
           in 2005, including counterfeit paintings
         of renowned Italian artists. Governments
             support artists by conducting raids of
           counterfeiters’ facilities and destroying
                                their fake products.


   While there has been much press play                    would disappear from the fi lmmaking map.
recently regarding on-line downloading of                  Today, the industry is in better shape and
music and movies in developed countries like               moviegoers around the world enjoy new
the United States, in fact it is in the develop-           and exciting releases primarily because
ing world that much of the serious damage is               Hong Kong authorities took decisive action
being done. Many new musical voices, new                   to combat the piracy problem. Studios in
authors, and new stories on fi lm around the               Bangladesh’s “Dhaliwood” movie industry
world have never been made available, sim-                 went on strike in March 2004 to protest the
ply because the incentives were not there for              problem of piracy and demand action by
these artists to take a risk. ey have known               the government. Similar developments have
that whatever they produce will be immedi-                 taken place in the world of music. Ethiopian
ately pirated — stolen — and they will not be              musicians went on a seven-month strike in
provided the means to develop their talent.                2003 to press for better anti-piracy measures
   is is not an abstract argument: It has                 from the government. ese artists all un-
happened on all continents. A good example                 derstood the importance of protecting their
is Hong Kong, where a thriving movie indus-                works from pirates.
try was so hurt by rampant piracy that, just
a few years ago, observers were predicting it

                                                                                                              11
PATENTS AND INNOVATION                              are associated with greater trade and foreign



                                                    direct investment flows, which in turn trans-
            atents protect diverse inventions       late into faster rates of economic growth.”
            such as industrial designs, manu-       Another 2002 World Bank publication,
facturing processes, high-tech products,            Development, Trade, and the WTO: A Hand-
and molecular compounds. Like copyrights,           book, noted a number of studies which, de-
patents were recognized in the U.S. Consti-         spite the lack of clear-cut results, did indicate
tution. The Constitution granted Congress           that stronger patent regimes could: 1) lead to
the powers to promote “the progress of sci-         increased global trade; 2) attract more for-
ence and useful arts” by providing inventors        eign direct investment; 3) lead to increased
the limited but exclusive right to their “dis-      licensing of technologies to, and possibly
coveries.”                                          more local production; and 4) contribute to
    e concept of a patent is based on a            higher growth rates.
trade-off. e inventor or innovator is given           A good example of this today can be
the exclusive right to make or use the inven-       found in Jordan, where strengthened pat-
tion for a limited period of time. In exchange,     ent protection has been linked to tangible
most countries’ rules require the inventor to       economic benefits (see story on p. 28). e
reveal the method behind the invention so           International Intellectual Property Institute
that others may understand and learn from           (IIPI) released a comprehensive report in Au-
it. After the exclusive period of time elapses,     gust 2004 that looked at the establishment
anyone can make, use, or sell the invention.        of globally competitive pharmaceutical and
e inventor is granted an economic in-              biomedical technology industries in Jordan.
centive to take risks and create; the public        e report found that “Jordan’s economy has
receives the benefit of the invention, as well      benefited greatly from the recent adoption of
as the inventor’s knowledge for application in      better intellectual property protections,” ac-
other uses.                                         cording to an IIPI release. e report noted
    Americans have always prided themselves         that the strengthened intellectual property
in being a nation of innovators and inventors,      regime, particularly for patents, “spurred a
willing to try something new, whether in in-        new focus on research-based innovation for
dustry or politics. As a result, patents are an     Jordanian pharmaceutical companies.”
important part of America’s history. While             is was reflected in a jump in the health-
most American schoolchildren probably do            service contributions to the Jordanian GDP
not know that patents are mentioned in the          from 2.8 percent in 1997 to 3.5 percent in
U.S. Constitution, many of them do know             2001. Employment in the health-services sec-
from their studies that one of the first patents    tor has increased 52 percent since 1997. e
issued was for Eli Whitney’s cotton gin, a ma-      report also found that “the pharmaceutical
chine that was to have a critical influence on      industry represents Jordan’s second leading
America’s subsequent development.                   sector, and from 1999 to 2002, drug exports
    But if this is true for America’s experience,   from local firms grew by 30 percent.”
then it is just as true for other countries, in-
cluding developing ones. Strong intellectual        TRADEMARKS AND CONSUMER
protection will not only encourage innova-          PROTECTION


                                                    
tion, it will provide the level of confidence in
an economy needed to attract foreign invest-                   trademark is a word, phrase, sym-
ment and spur technology transfer. is has                     bol, or design, or a combination
been shown in a number of studies looking           of words, phrases, symbols, or designs, that
at the relationship between intellectual            identifies and distinguishes the source of
property, especially patents, and develop-          the goods of one party from those of others.
ment. For example, a study highlighted in           They thus identify the producer of a product
the World Bank’s Global Economic Prospects          and serve as an indicator of quality. They also
Report 2002 found that “across the range of         inform consumers where to seek recourse if
income levels, intellectual property rights         the product fails. Some forms of trademarks

12
 A plate from the catalogue of the 1871 London
 International Exhibition shows an Elias Howe
 sewing machine, invented in 1845. Howe patented                A sketch of Eli Whitney, who invented the cotton gin
 the machine in the United States in 1846, and was              and patented it in 1793.
 able to sue other companies for infringement of his
 patent rights.




A patented device
that has brightened
our world: American
inventor Thomas Edison’s
filament lamp (1879),
with the first practical
lightbulb.                        A phony Pokemon card, left, held up next to a real one at Nintendo’s
                                  Redmond, Washington, offices. To fight counterfeiters, Nintendo is
                                  training customs officials and police in the United States how to tell the
                                  difference between real and fake cards.


                                                                                                               13
   Enduring quality:
Visitors to the Great
   Wall in China can
still see the original
 brick maker’s mark
       on some of its
bricks. These marks
    were assurances
       of quality and
       accountability
     to the emperors
    who ordered the
      building of this
    cultural wonder.




     When consumers buy counterfeit and pirated goods — in           Some old packages and containers of Bayer Aspirin, a
     this case, pirated music compact discs (CDs) and movie          well-known brand for this pain reliever. The German
     digital video discs (DVDs) — they lose the authentic            company Bayer was granted a patent for this wonder drug
     manufacturers’ assurance of quality and accountability.         and launched it on the market in 1899. Aspirin® is a Bayer
                                                                     AG Company registered trademark.




     In the United States, copyright protection lasts for the life   The first children’s crayons ever made, in 1903, came from
     of the author plus an additional 70 years for works such as     Crayola®, now a registered trademark of Binney & Smith.
     books and movies created after January 1, 1978.


               14
have been around for thousands of years.         the report, subsequent police raids uncovered
Visitors to the Great Wall in China can still    thousands of bags of counterfeit milk powder
see the original producer’s mark on some of      with the labels of 45 different brands.
its bricks. This mark allowed the emperors          Counterfeit pharmaceuticals also have
of that time to be assured of quality and, if    become a serious and deadly problem around
needed, accountability.                          the globe, especially in the developing world.
    is assurance of quality and account-        No one knows this better than the head
ability is completely lost when counterfeiters   of Nigeria’s National Agency for Food and
illegally use a trademark and deceive con-       Drug Administration and Control, Dorothy
sumers with their goods. When many people        Akunyili. Her story, which was detailed in
think of counterfeit goods, they might bring     a May 2004 front-page article in the Wall
to mind items such as fake Rolex watches,        Street Journal, seems to come straight from
Zippo lighters, or Louis Vuitton handbags.       an action novel. Unfortunately, it is fact,
e counterfeiting of these goods does inflict    not fiction. Her work to expose and combat
serious harm on legitimate companies, and        counterfeit pharmaceuticals has led to as-
it deprives governments of lost revenues. But    sassination attempts against her life and
counterfeiting of trademarks has another se-     arson attacks against her facilities. But she
rious consequence. It can threaten the health    has bravely continued her work, spurred on
and safety of the public.                        in part by the personal experience of losing
    e United States is not immune to this       her sister, who died because of a counterfeit
aspect of the counterfeiting epidemic. In        insulin injection. She, like many others, has
testimony before the U.S. Senate Judiciary       understood the dangers and threats posed by
Committee in March 2004, U.S. Assistant          counterfeiting.
Attorney General Christopher Wray pro-
vided examples of trademark violations. He       IP AND SOCIETY


                                                 
noted that, in early 2004, a man from the
state of Alabama pled guilty to 28 counts                here is a common thread that runs
of counterfeiting and pesticide misbranding              through the above discussion of copy-
charges. He sold mislabeled and adulterated      rights, patents, and trademarks. Promoting
pesticides needed to control mosquitoes and,     cultural development, fostering innovation
indirectly, West Nile virus, to municipalities   and growth, and protecting public health
and private businesses in a number of U.S.       and safety are all commonly held goals. We
states. e defendant falsely identified the      all want to live in societies where these values
brand name of the pesticide, the manufac-        are cherished and fostered. In the current de-
turer, and the active ingredients. In another    bate surrounding intellectual property, it is
case in 2002, the U.S. Department of Justice     worth remembering the role of intellectual
convicted a California man on federal charg-     property protection in our daily lives.
es involving a conspiracy to sell counterfeit        e United States believes strongly in
baby formula. After exposing thousands in        the value of protecting intellectual property
our most vulnerable population to coun-          rights, for the reasons outlined above and
terfeit baby formula, the defendant fled to      more, and stands ready to work with others
Canada in 1995. He was arrested there in         to promote such protection. 
2001 and in 2002 was brought to the United
States to stand trial.
    Counterfeiting is a serious public health
and safety threat in the developing world as     E. Anthony Wayne is U.S. Assistant Secretary of State
well. One of the more tragic stories comes       for Economic and Business Affairs.
from China. In May 2004, the Associated
Press reported from Beijing that 47 people
had been accused of selling fake infant for-
mula, an act that authorities said led to the
deaths of dozens of children. According to

                                                                                                         15
      A Short Guide to
International
     IPR Treaties
                                                  By Paul E. Salmon




      trong protection for intellectual prop-
       erty rights (IPR) worldwide is vital to
the future economic growth and develop-
ment of all countries. Because they create
                                                     As a strong adherent of the TRIPS Agree-
                                                  ment and all other international IPR treaties
                                                  discussed below, the U.S. government en-
                                                  courages other countries to join and imple-
common rules and regulations, international       ment them.
IPR treaties, in turn, are essential to achiev-
ing the robust intellectual property protec-      TRIPS


                                                  
tion that spurs global economic expansion
and the growth of new technologies.                       he TRIPS Agreement came into force
    e international community, however,                  in 1995, as part of the Agreement
did not have a single source for intellectual     Establishing the World Trade Organization.
property obligations and norms until the          TRIPS incorporates and builds upon the
1994 Uruguay Round of the General Agree-          latest versions of the primary intellectual
ment on Tariffs and Trade created the World       property agreements administered by the
Trade Organization (WTO) and included             World Intellectual Property Organization
the Agreement on Trade-Related Aspects of         (WIPO), the Paris Convention for the Pro-
Intellectual Property Rights (TRIPS).             tection of Industrial Property, and the Berne
    e significance of the TRIPS Agreement        Convention for the Protection of Literary
is three-fold:                                    and Artistic Works, agreements that go back
1) It is the first single, truly international    to the 1880s.
    agreement that establishes minimum               TRIPS is unique among these IPR accords
    standards of protection for several forms     because membership in the WTO is a “pack-
    of intellectual property;                     age deal,” meaning that WTO members are
2) It is the first international intellectual     not free to pick and choose among agree-
    property agreement that mandates de-          ments. ey are subject to all the WTO’s
    tailed civil, criminal, and border enforce-   multilateral agreements, including TRIPS.
    ment provisions; and                             TRIPS applies basic international trade
3) It is the first international intellectual     principles to member states regarding intel-
    property agreement that is subject to         lectual property, including national treat-
    binding, enforceable dispute settlement.      ment and most-favored-nation treatment.
    TRIPS, in effect, lays the groundwork for     TRIPS establishes minimum standards for
    a strong and modern IPR infrastructure        the availability, scope, and use of seven forms
    for the world community.                      of intellectual property: copyrights, trade-

16
                                                     The home web page for the World
                                                     Intellectual Property Organization (WIPO),
                                                     the international body for the protection of
                                                     IPR and the administering agency for most
                                                     international IP agreements.


marks, geographical indications, industrial           At the 2001 WTO Ministerial Confer-
designs, patents, layout designs for integrated   ence in Doha, least-developed countries were
circuits, and undisclosed information (trade      given an additional 10 years to implement
secrets). It spells out permissible limitations   TRIPS patent and “undisclosed information”
and exceptions in order to balance the inter-     provisions as they relate to pharmaceuticals.
ests of intellectual property with interests          Because the TRIPS Agreement is a decade
in other areas, such as public health and         old, however, it does not address several new
economic development. (For the complete           developments, such as the Internet and digi-
text of the TRIPS Agreement, as well as an        tal copyright issues, advanced biotechnology,
explanation of its provisions, see the WTO        and international harmonization, the process
web site at http://www.wto.org.)                  of creating uniform global standards of laws
   According to TRIPS, developed countries        or practice. It sets the floor for minimum IPR
were to have implemented the agreement            protection, not the ceiling.
fully by January 1, 1996. Developing-country          Since the conclusion of the TRIPS Agree-
members and members in transition to a            ment, the World Intellectual Property Or-
market economy were entitled to delay full        ganization has addressed digital copyright
implementation of TRIPS obligations until         issues in the so-called Internet Treaties,
January 1, 2000. Least-developed members          namely the WIPO Copyright Treaty (WCT)
were given until January 1, 2006, to imple-       and the WIPO Performances and Phono-
ment their obligations, with the possibility of   grams Treaty (WPPT).
further transition upon request. Developing           What follows are summaries of other
countries that did not provide patent protec-     WIPO treaties that complement the TRIPS
tion for particular areas of technology on        Agreement, particularly in addressing new
their date of application were given an ad-       technological developments. For texts of the
ditional five years, until January 1, 2005, to    WIPO treaties discussed below, see: http:
provide such protection.                          //www.wipo.int/.

                                                                                                    17
TRADEMARK LAW TREATY                                 An additional advantage of the TLT is



                                                  the harmonization of the initial and renewal
          he Trademark Law Treaty (TLT),          terms of trademark registration among sig-
          adopted on October 27, 1994, entered    natory countries: e TLT provides for an
into force on August 1, 1996. Thirty-three        initial 10-year term, with 10-year renewals.
states, including the United States, are party       Other key features of the TLT include the
to the TLT as of July 1, 2005. The TLT was        introduction of an intent-to-use application
enacted to simplify procedures in the appli-      system (with proof of use prior to registra-
cation and registration process and to har-       tion); streamlined renewal procedures;
monize trademark procedures in different          minimization of the elements to obtain an
countries. The TLT harmonizes procedures          application fi ling date; and simplified pro-
of national trademark offices by establishing     cedures for recording changes in name and
the maximum requirements a contracting            ownership of trademark applications and
party can impose.                                 registrations.
     e TLT gives service marks — the dis-           Overall, the TLT is intended to facilitate
tinctive identifiers of businesses that offer a   international trade: It is of particular impor-
service, as opposed to goods — “equal” status     tance to individuals and small businesses
with trademarks. Previously, many foreign         looking for markets in other countries.
countries treated trademarks and service          Currently, WIPO’s Standing Committee on
marks differently. e TLT requires mem-           Trademarks, Industrial Designs, and Geo-
ber nations to register service marks and         graphical Indications (SCT) is conducting
treat them as they would trademarks.              negotiations on proposed revisions to the
     From the trademark owner’s perspec-          TLT. is standing committee recommend-
tive, the TLT saves time and money in the         ed that the WIPO General Assembly hold a
preparation and fi ling of documents for the      diplomatic conference March 13-31, 2006, to
application. It streamlines the process for       consider adoption of the revised TLT.
post-registration renewals, recording assign-
ments, changes of name and address, and           PATENT LAW TREATY


                                                  
powers of attorney. Member countries to the
TLT are now required to permit the use of                 he Patent Law Treaty (PLT), adopted
multi-class applications, enabling trademark              by WIPO in June of 2000, entered
owners to fi le a single application covering     into force on April 28, 2005. The PLT is
multiple classes of goods and services.           the product of several years of multilateral
     Another significant feature of the TLT       negotiations on harmonizing global patent
that benefits trademark owners is its prohibi-    systems. The PLT harmonizes certain patent
tion of requirements by national offices for      application procedures in order to reduce or
authentication or certification of documents      eliminate formalities and the potential for
as well as signatures on trademark applica-       loss of rights. The PLT does not harmonize
tions and correspondence. Many countries          substantive patent law, that is, the laws of
had required that any signatures submitted        each country that set forth the conditions
in support of registration of a mark be no-       that must be met in order to receive a pat-
tarized or otherwise legalized in accordance      ent for an invention in that country. WIPO,
with the laws of that nation. Under the TLT,      however, is holding discussions regarding
it is no longer necessary in most instances to    harmonization of substantive patent law.
go through these procedures. is feature             e PLT will make it easier for patent
enables trademark owners to complete and          applicants and patent owners to obtain and
fi le trademark documents more quickly, at        maintain patents throughout the world by
less cost.                                        simplifying and, to a large degree, merging
                                                  national and international formal require-
                                                  ments associated with patent applications
                                                  and patents.


18
                                                                                                        The first Benz motor
                                                                                                        car, 1888. The
                                                                                                        German imperial
                                                                                                        patent 5789 was
William Hedley developed the system that gave                                                           granted to Karl
locomotives with smooth wheels sufficient traction. He                                                  Benz in 1886 for the
patented this in 1813, the same year he unveiled his famous                                             design of an “oil
steam locomotive, “Puffing Billy,” here seen outside of                                                 spirit motor tricycle.”
London’s Patent Museum (today’s Science Museum).


                                Berliner gramophone, 1890.
                           Emile Berliner patented a form of
                       recording in which sound waves were
                       photoengraved on a zinc disc in 1887.
                        Eventually, his invention became the
                               basis for the record industry.



      e PLT:                                                 for applicants and patent offices, the duplica-
    simplifies and minimizes patent applica-                 tion of effort involved in filing and obtaining
     tion requirements to obtain a fi ling date;              patent applications for the same invention
    imposes a limit on the formal requirements               in different countries. The resulting WIPO
     that Contracting Parties may impose;                     treaty, the PCT, was signed in Washington,
    eases representation requirements for for-               D.C., in 1970 and entered into force in 1978.
     mal matters;                                             The treaty was amended in 1979, 1984, 2001,
    provides a basis for the electronic fi ling of           and 2004. As of September 15, 2005, there
     applications;                                            are 128 Contracting Parties to the PCT.
    provides relief with respect to time limits                   By simplifying patent application fi ling,
     that may be imposed by the Office of a                   the PCT assists innovators in obtaining pat-
     Contracting Party and reinstatement of                   ent protection throughout the world. It also
     rights where an applicant or owner has                   encourages small businesses and individuals
     failed to comply with a time limit and that              to seek patent protection abroad.
     failure has the direct consequence of caus-                   Under this WIPO-administered treaty,
     ing a loss of rights; and                                nationals or residents of a contracting state
    provides for correction or addition of                   fi le a single patent application, called an “in-
     priority claims and restoration of priority              ternational” application, with their national
     rights.                                                  patent office or with WIPO as a receiving of-
                                                              fice. is automatically lodges the application
   PATENT COOPERATION TREATY SYSTEM                           for patent protection in all 128 Contracting


   
                                                              Parties of the PCT.
          he roots of the Patent Cooperation                       e treaty provides a longer period of
          Treaty (PCT) go back to 1966, when                  time, 30 months, before applicants must
   the Executive Committee of the Paris Con-                  commit themselves to undertake the ex-
   vention for the Protection of Intellectual                 penses of translation, national fi ling fees, and
   Property called for a study of how to reduce,              prosecution in every country in which they

                                                                                                            19
want protection. By providing applicants         and more trademark owners are using the
with more time and information to evaluate       Madrid Protocol every year to protect their
the strength of their potential patent and to    trademarks in foreign countries. As of Sep-
determine marketing plans, the 30-month          tember 15, 2005, there were 66 contracting
period allows applicants to be more selec-       parties to the Madrid Protocol.
tive as to the countries in which they will           e Madrid Protocol is a fi ling treaty and
fi le. is is a major improvement over the       not a substantive harmonization treaty. It
12-month priority period provided under the      provides a cost-effective and efficient way
Paris Convention for patent applicants.          for trademark holders — individuals and
     Under the PCT, WIPO publishes the           businesses — to ensure protection for their
“international application,” together with       marks in multiple countries through the fi l-
a nonbinding indication as to the potential      ing of one application with a single office, in
patentability of the invention. is nonbind-     one language, with one set of fees, in one cur-
ing indication is a preliminary search and/or    rency. Moreover, no local agent is needed to
examination by an “International Authority,”     fi le the application. Applications may be fi led
one of 11 patent offices designated by WIPO      in English, French, or Spanish.
that currently meet the treaty’s minimum              An application for international registra-
staffing and documentation requirements.         tion has the same effect as a national applica-
e nonbinding indication helps applicants        tion for registration of the mark in each of the
decide whether to proceed with their patent      countries designated by the applicant. Once
applications in national or regional offices.    the trademark office in a designated country
Patent offices also benefit from these non-      grants protection, the mark is protected just
binding indications of patentability when de-    as if that office had registered it.
ciding whether to grant national or regional          e Madrid Protocol also simplifies the
patents based upon PCT applications. For-        subsequent management of the mark, since
eign search reports identify relevant docu-      a simple, single procedural step serves to
ments that help patent offices to conserve       record subsequent changes in ownership or
resources in the examination process and to      in the name or address of the holder with
improve the quality of examination.              WIPO’s International Bureau.
                                                      Before the protocol was enacted, bur-
MADRID SYSTEM FOR                                densome administrative requirements for
THE INTERNATIONAL REGISTRATION                   the normal transfer of business assets often
OF MARKS                                         made it difficult for trademark owners to car-



                                                 ry out valid assignments of their marks in-
        he Protocol Relating to the Madrid       ternationally. e protocol allows the holder
        Agreement Concerning the Interna-        of an international registration to fi le a single
tional Registration of Marks — the Madrid        request with a single payment, in order to re-
Protocol — was adopted in Spain’s capital        cord the assignment of a trademark with all
on June 27, 1989, and entered into force on      the member countries. Registration renewal
December 1, 1995. The protocol is one of         also involves a simple, single procedural step.
two treaties comprising the Madrid System        International registration lasts 10 years, with
for international registration of trademarks.    10-year renewal periods.
The first treaty, the 1891 Madrid Agreement,          Trademark owners may designate addi-
provides for the registration of trademarks in   tional countries if they decide to seek pro-
several countries through the filing of one      tection in more member countries or if new
international trademark registration with        countries accede to the protocol.
WIPO in Geneva.
   e Madrid Protocol, developed because
some countries had problems with the opera-
tion of the Madrid Agreement, is seen as an
improvement to the system for international
registration of trademarks. As a result, more

20
Nobel Prize winners Drs. William Shockley (seated), John Bardeen (left), and Walter H. Brattain at the
Bell Telephone Laboratories in 1948. Their invention of the transistor spawned the Information Age and,
ultimately, the need for new or revised IP treaties to deal with issues such as domain names.




A woman looks at Microsoft® products at a shop in Brussels. Thanks to the Madrid Protocol’s improvements
to the system for international registration of trademarks, it is easier for companies like Microsoft to protect
their marks in foreign countries.



                                                                                                               21
          Bakers from Dresden, Germany, have kept the trade secret of the exact components of their Christmas cake for
          more than 100 years. Only about 130 bakeries and cake shops in that city are allowed to produce these cakes
          with a seal of quality under a registered trademark, “Echter Dresdner Christstollen.”




One of Italy’s culinary delights, Parmesan cheese,
is typical of the products that the TRIPS Agreement
protects under the rubric of geographical indications.




                                                           IPR protections reward the ingenuity of breeders of new
                                                           plant varieties.
The so-called Internet Treaties — the WIPO Copyright
Treaty and the WIPO Performances and Phonograms
Treaty — address digital copyright issues that cropped
up with the development of the Internet.


              22
    If the basic application — or registration         Under the treaty, the deposit of a micro-
upon which the international registration is        organism with an “international depositary
based — is cancelled for any reason in the          authority” satisfies the deposit requirements
first five years, the Madrid Protocol gives         of treaty members’ national patent laws. An
the holder of the international registration        “international depositary authority” is capa-
the opportunity to turn the international           ble of storing biological material and has es-
registration into a series of national applica-     tablished procedures that assure compliance
tions in each designated country. is series        with the Budapest Treaty. Such procedures
of applications keeps the priority date of the      include requirements that the deposit will
original international registration in each         remain available for the life of the patent and
country. e holder also preserves the rights        that samples will be furnished only to those
acquired in each member country, even if            persons or entities entitled to receive them.
international registration fails.                      e establishment of “international de-
                                                    positary authorities” offers several advantag-
THE HAGUE SYSTEM FOR                                es to both patent applicants and contracting
THE INTERNATIONAL DEPOSIT                           states. Patent applicants benefit because the
OF INDUSTRIAL DESIGNS                               need to deposit in many countries in which



                                                    they seek patent protection is dramatically
        he Hague System is an international         reduced. Since a single deposit in any “in-
        registration system that enables own-       ternational depositary authority” will satisfy
ers to obtain protection for their industrial       the national disclosure requirements of any
designs with a minimum of formality and             member state, patent applicants’ costs are
expense. A single international application         much lower. Using a single authority as a
filed with WIPO’s International Bureau              deposit increases the deposit’s security, and
replaces a whole series of applications previ-      provides a mechanism of distribution of the
ously required in a number of states and/or         deposit. Contracting states benefit because
intergovernmental organizations party to the        they can rely on the treaty’s uniform stan-
Hague System. The subsequent management             dards to assure effective deposit and public
of the international registration is consider-      availability. ey no longer need to indepen-
ably easier under this system. For example,         dently establish a ‘recognized’ depositary
one single step is all that is needed to record a   to meet national patentability disclosure
change in the name or address of the holder,        requirements.
or a change in ownership for some or for all           As of May 2005, there are 60 Patent Of-
of the designated contracting parties.              fices that abide by the terms of the Budapest
    e Hague System had 42 contracting              Treaty and 35 “international depositary au-
parties as of April 26, 2005.                       thorities” in 22 different countries.

BUDAPEST TREATY ON                                  INTERNATIONAL CONVENTION FOR
THE INTERNATIONAL RECOGNITION                       THE PROTECTION OF NEW VARIETIES
OF THE DEPOSIT OF MICROORGANISMS                    OF PLANTS


                                                    
FOR THE PURPOSE OF PATENT
PROCEDURE                                                   he International Convention for



                                                            the Protection of New Varieties of
        he Budapest Treaty on the Interna-          Plants (UPOV) established an internation-
        tional Recognition of the Deposit of        ally recognized intellectual property system
Microorganisms for the Purpose of Patent            for the protection of new plant varieties. The
Procedure, signed on April 28, 1977, was            UPOV Convention encourages and rewards
amended on September 26, 1980. The Bu-              the ingenuity and creativeness of breeders
dapest Treaty eliminates the need to deposit        developing new varieties of plants. Anyone
microorganisms in each country where pat-           who develops a new variety of plant that may
ent protection is sought.                           be disease resistant, drought resistant, cold
                                                    tolerant, or simply aesthetically more pleas-

                                                                                                23
In 2001, WTO gave least-developed countries
another 10 years to implement TRIPS patent
and “undisclosed information” provisions on
pharmaceuticals. Here, a scientist in a lab conducts
quantitative analysis of medicine tablets.




                           TRIPS covers seven forms of
                          IP, including trademarks and
                           patents. Below, the recently
                           updated logo for the Zenith
                        Electronics Corporation. Right,
                        SnifferSTAR, a patented device
                    from Sandia National Laboratories
                         in Albuquerque, New Mexico,
                    intended to detect airborne blister
                                agents and nerve gases.




         ing is no less an inventor than someone who      at the same time, disseminate the knowledge
         improves an automobile engine or develops        of that innovation for others to improve
         a new medicinal drug. The only difference is     upon. e UPOV system establishes basic
         that the plant breeder works with living ma-     legal principles of protection that reward
         terial, rather than inanimate matter.            breeders for their inventiveness by provid-
            e process of creating a new plant vari-      ing exclusive rights to their plant invention,
         ety is often long and expensive. Reproducing     while encouraging the development of new
         an existing plant variety, however, can be       plant varieties.
         quick and relatively easy. us, an effective
         system of intellectual property protection
         needs to reward innovation by permitting
         inventors to recover their investment and,

         24
    Under the 1991 UPOV system, the most          CONCLUSION


                                                  
recently concluded of these, the exclusive
rights granted to the inventor (commonly                n the information age, with technol-
referred to as “breeder’s rights”) require that         ogy advancing at an accelerating rate,
another party other than the owner of the         simply implementing the TRIPS Agreement
breeder’s rights receive the breeder’s autho-     is not enough to establish a robust intellec-
rization to:                                      tual property system. While it was the first
 produce or reproduce the protected vari-        comprehensive IPR agreement of its time, it
   ety;                                           is a decade old, and reflects a “snapshot” in
 condition the variety for propagation pur-      time. Technological advances in information
   poses; and                                     technology, biotechnology, and other fields
 offer to sell or market, import, export, or     require the updating of national and inter-
   to stock the protected variety.                national laws that protect IP. Fortunately,
    To receive a breeder’s right, a breeder       WIPO has led the way in developing new in-
must invent a plant variety that is new, dis-     ternational norms to meet these challenges.
tinct, uniform, and stable. Under the UPOV           WIPO also has led the way in simplifying
Convention, however, a plant breeder gener-       and streamlining the procedures for seeking,
ally does not need breeder authorization to       obtaining, and maintaining rights in multi-
use protected plant varieties for noncom-         ple countries. rough its “Global Protection
mercial or experimental acts or acts done for     Services” and its harmonization treaties, it
the purposes of breeding new plant varieties.     saves creators and national IP offices a great
e UPOV Convention also allows each               deal of time and effort. WIPO also makes
member nation to restrict the breeder’s right     available its excellent technical assistance
in relation to any variety to allow farmers       for establishing and improving IPR systems
to use part of their harvest for subsequent       worldwide. Countries should look to both the
plantings in their own land. ese restric-        WTO and to WIPO when crafting their IPR
tions, however, must be within reasonable         systems. 
limits and subject to the safeguarding of the
legitimate interests of the breeder.
    UPOV member states hold biannual meet-
ings of the Council, a permanent body of the      Paul E. Salmon is a patent attorney in the U.S. Patent
convention. Other UPOV bodies include the         and Trademark Office’s Office of International
Consultative Committee, the Administrative        Relations. Mr. Salmon also served as the Intellectual
and Legal Committee, and the Technical            Property Attaché in Geneva, Switzerland, where he
                                                  represented the U.S. government in meetings of WIPO
Committee, made up of several Technical
                                                  and the WTO. He lectures frequently on the subject of
Working Parties (TWPs) across several ag-         international patent law.
ricultural sectors. e TWPs meet periodi-
cally to share and discuss observations and
advancements in agricultural sectors, which
helps to standardize examination standards
among member states. ese TWP meetings
benefit breeders as well, since more uniform
standards lead to greater consistency of ap-
plication fi lings in different territories.
    As of June 29, 2005, there were 59 mem-
ber States to the UPOV Convention. UPOV
membership is expected to continue to in-
crease in the next several years.
    For more information on UPOV, see:
http://www.upov.int.



                                                                                                      25
    Intellectual
Property
      Training and
      Technical Assistance Programs
                                                    By Allison Areias




         ountries with effective intellectual
          property (IP) protection reap the ben-
 efit of protecting their own intellectual prop-
 erty, as well as creating a positive foreign in-
                                                    Department, with hands-on instruction on
                                                    how to try an IPR case and operational train-
                                                    ing by the Department of Homeland Security
                                                    to help customs officers to better identify and
 vestment environment. But many countries           seize counterfeit goods at ports and border
 face serious obstacles to IP protection, such      crossings.
 as a lack of IP awareness, inadequate laws,           U.S. embassies abroad also provide and
 and ineffective enforcement mechanisms,            coordinate IP training programs, as well as
 and many do not have the resources to ad-          public awareness and outreach activities.
 dress these issues.                                e State Department invests significant re-
     e U.S. government and U.S.-based IP           sources to develop the necessary IP expertise
 private industries provide extensive training      in its officer corps overseas, so as to enable
 for foreign officials and nationals. During        them to support our overall training efforts
 2003 and early 2004, U.S. trainers spon-           in addition to recognizing IP issues and ad-
 sored 295 programs, ranging from optical           dressing them through diplomatic channels.
 disc forensic training in the Philippines to          e U.S. private sector is also very ac-
 prosecution and investigation techniques           tive. e Recording Industry Association of
 in Egypt. U.S. government IP training pro-         America, the Motion Picture Association of
 viders include the Patent and Trademark            America, the Business Software Alliance,
 Office, the Department of Commerce Com-            the Pharmaceutical Research and Manufac-
 mercial Law Development Program, the               turers of America, the International Intel-
 Department of Justice, the Department of           lectual Property Institute, the International
 Homeland Security divisions of Customs             Anti-Counterfeiting Coalition, and their
 and Border Protection and of Immigration           member companies and contributors all
 and Customs Enforcement, and the Library           provide training worldwide. For instance,
 of Congress’ Copyright Office. e U.S. State       in December 2004, the International Intel-
 Department funds many training programs,           lectual Property Institute paired with the
 either through the Agency for International        U.S. Patent and Trademark Office to hold a
 Development (USAID), the Bureau of Inter-          three-day seminar in West Africa for over
 national Narcotics and Law Enforcement,            70 participants, including judges, attorneys,
 or the Bureau of Educational and Cultural          public health experts, and business people
 Affairs. ese programs include, for exam-          from Nigeria, e Gambia, Senegal, Ghana,
 ple, prosecutorial training, led by the Justice    and Burundi. e participants learned about

 26
                                                            U.S. trainers recently sponsored an optical disc
                                                            forensic training program in the Philippines. Here,
                                                            Filipino officials from the Videogram Regulatory
                                                            Board and security forces confiscate boxes of
                                                            pirated video compact discs from stalls during a
                                                            raid in Manila.




                                              Web site for the U.S.
                                              government IPR Training
                                              Programs Database.

                                                       U.S. government and industry training
                                                   is catalogued at http://www.training.ipr.gov.
the role IP plays in economic development          e site includes brief descriptions of the
for West Africa, the problems of counterfeit       training programs and contact information
medicines in their region, and how IP acts as      for the training providers. Although many of
a catalyst for the fi lm and music industries in   these programs are for foreign government
their countries.                                   officials, some are open to the public and of-
   Training programs focus on all aspects          fered free of charge.
of IP enforcement, as well as intragovern-             For more information about IP training,
mental coordination and the importance             please contact the Office of International
of strong relationships between the police,        Intellectual Property Enforcement, U.S.
IP officials, judicial authorities, and rights     Department of State, at (202) 647-3251, or
holders. Focusing IP enforcement training          at EB/TPP/IPE, Room 3638, 2201 C Street,
efforts on smuggling trends and routes is also     Washington, D.C., 20520. 
critical, especially for areas where porous
borders facilitate international trafficking in
counterfeit and pirated products. With the
commercialization of the Internet and the          Allison Areias is a U.S. Foreign Service officer who
rise of Internet piracy, U.S. trainers also help   served in the State Department Economic Bureau’s
countries develop the legislative and enforce-     Office of International Intellectual Property
ment framework necessary to address this           Enforcement.
growing problem.


                                                                                                          27
                  Jordan Benefits from

    Intellectual
Property Reforms
                                                   By Jeanne Holden




     ntellectual property rights (IPR) pro-
      tection can be a powerful tool for
economic growth. In Jordan, for example,
recent intellectual property reforms have
                                                       Laws consistent with the WTO Agree-
                                                   ment on Trade-Related Aspects of Intellectu-
                                                   al Property Rights (TRIPS) now protect trade
                                                   secrets, plant varieties, and semiconductor
greatly benefited that country’s economy in        chip designs in Jordan. Registration of copy-
general and its pharmaceutical sector in par-      rights, patents, and trademarks is required.
ticular. Jordan’s pharmaceutical sector has        Copyrights are registered at the National
gained new export markets and has started          Library and patents are registered with the
to engage in innovative research. New health       Registrar of Patents and Trademarks, both
sectors, such as contract clinical research,       part of Jordan’s Ministry of Industry and
have emerged, and health-sector employ-            Trade. Jordan has signed the Patent Co-
ment has grown.                                    operation Treaty and the protocol relating
   Jordan joined the World Trade Organi-           to the Madrid Agreement Concerning the
zation (WTO) in 2000, becoming its 136th           Registration of Marks, but ratification was
member. In 2001, it entered the U.S.-Jordan        still pending in early 2005. Jordan has also
Free Trade Agreement (FTA), the first such         acceded to the World Intellectual Property
agreement between the United States and an         Organization (WIPO) treaties on copyrights
Arab trading partner. rough these agree-          (WCT) and performances and phonographs
ments, the government of the Hashemite             (WPPT).
Kingdom of Jordan continued a process of               Jordan’s pharmaceutical industry abides
comprehensive economic reforms that had            by the new TRIPS-consistent patent law. In
been underway for about a decade. In fact,         addition, with the signing of the U.S.-Jordan
Jordan passed several new laws to improve          FTA, Jordan committed to even stronger
protection of intellectual property rights         enforcement of intellectual property rights,
prior to its accession to the WTO. “e             particularly in the pharmaceutical sector.
government of Jordan has embarked on an            According to Economic and Trade Officer
aggressive program to transform the country        Greg Lawless at the U.S. Embassy in Amman,
from a dependence on foreign aid to success        intellectual property rights enforcement has
in the era of globalized trade. Trade agree-       improved in Jordan. “Effective enforcement
ments, legal reforms, and a strong IPR pro-        mechanisms and legal procedures, still not
tection regime are all a part of that strategy,”   completed, are undergoing further refine-
according to U.S. Embassy Chargé d’Affaires        ment,” he said. Although significant chal-
David Hale in Amman, Jordan.                       lenges remain, Jordan’s enforcement action

28
against audio/video and software piracy is
growing in quantity and improving its capa-
bility to target problem areas, he added.
    According to the Pharmaceutical Manu-
facturers Association of America (PhRMA),
the U.S.-Jordan FTA has made Jordan’s
market more appealing for pharmaceutical
research and development, as well as for
sales and licensing agreements. e benefits
of the U.S.-Jordan FTA for industry include
expanded data protection, elimination of ex-
clusions from patentability for biotechnology
inventions, and limitations on compulsory
licensing.
    In October 2001, PhRMA established an
office in Amman to serve the Middle East
and North Africa region. It was PhRMA’s
first presence in the region. Jordan’s com-
mitment to free trade and high-standard
business practices were decisive factors in
the decision, according to Susan Finston,
PhRMA’s associate vice president. “Jordan
was the place where in less than 45 business
days we could open an office, get credentials,
and have all of the infrastructure and the
legal permits that we needed for business,”
she said.
    Many PhRMA members have established
or expanded their commercial activities in
Amman, including American Home Prod-              Jordan’s leading Hikma pharmaceutical company
                                                  was the first Arab pharmaceutical company to
ucts, AstraZeneca, Sanofi-Aventis, Bristol-       export one of its products — a non-steroidal anti-
Myers Squibb, Eli Lilly, GlaxoSmithKline,         inflammatory drug — to the U.S. market.
Janssen-Cilag, Merck Sharp & Dohme,
Novartis, Organon, Roche, Pfizer, and Scher-
ing-Plough.                                       citizens. Rapid introduction of new products
    Several PhRMA members are conducting          would also benefit Jordan’s medical tourism
clinical trials and entering into co-marketing    sector (a term referring to people who travel
and/or licensing agreements with Jordanian        to other regions or countries in search of
companies. According to the International         health-care options). According to a recent
Intellectual Property Institute (IIPI), a non-    IIPI report, medical tourism represents
profit economic development organization          two-thirds of total tourism revenues in Jor-
and think tank based in Washington, D.C.,         dan. e October 2004 report, Establishing
Bristol-Myers Squibb initiated a three-year,      Globally Competitive Pharmaceutical and
5,000-patient cardiovascular risk factor          Biotechnology Industries in Jordan, stressed
study in Jordan in 2001. Moreover, PhRMA          that clinical trials are enhancing physician
reports that, in 2004 alone, its member com-      and hospital skills and, in the process, fur-
panies carried out 19 clinical trials in Jordan   ther enhancing economic growth in medical
for conditions such as cancer, osteoporosis,      tourism. It said that a recent survey of pa-
diabetes, and cardiovascular disease.             tients identified medical expertise of physi-
    rough clinical trials, it is hoped that      cians as the main reason medical tourists
more innovative pharmaceutical products           come to Jordan.
will eventually be made available to Jordan’s

                                                                                                       29
    IIPI produced the report in partnership         e IIPI report found that Jordan’s generic
with the Achievement of Market Friendly          pharmaceutical companies also benefited
Initiatives and Results (AMIR) Program, a        from stronger intellectual property laws,
project funded by the U.S. Agency for Inter-     with drug exports from local Jordanian firms
national Development (USAID). According          growing 30 percent from 1999 to 2002. Jor-
to the U.S. Embassy in Amman, USAID has          dan’s exports in pharmaceuticals in 2004 will
provided significant amounts of technical        top U.S. $200 million, according to estimates
assistance to the Jordanian public and pri-      provided by the U.S. Embassy in Amman.
vate sectors in support of intellectual prop-    When combined with domestic output, total
erty rights improvements during the past         production by pharmaceutical firms easily
five years, including assistance in crafting     will be over U.S. $300 million. “is repre-
laws and regulations.                            sents a significant improvement over 2003, a
    At the request of the government of Jor-     year in which economic growth was affected
dan, USAID also is providing technical assis-    by regional conflicts,” Lawless said.
tance to improve the regulatory environment         Jordan’s experience suggests that intel-
for patents and trademarks. USAID contin-        lectual property rights protection can be a
ues to support Jordan’s implementation and       powerful tool for economic growth. “Market
enforcement of the new intellectual property     size, population, geography: None of these
laws by working with the Jordan Intellectual     is destiny,” declared Susan Finston. “Destiny
Property Association (JIPA). JIPA is hosting     resides in the political will of governments to
training programs for the National Library,      take up the important challenge of economic
customs authorities, and the private sector.     reform.” 
    “e adoption of stronger intellectual
property protection is helping to transform
Jordan into the leading knowledge economy
in the region,” the IIPI report concluded.       Jeanne Holden is a free-lance writer with expertise in
Growth in Jordan’s pharmaceutical and            economics and IP issues. She worked as a writer-editor
biomedical technology industries has been        in the U.S. Information Agency for 17 years.
strong since the implementation of a stronger
intellectual property regime, it says. Health-
service contributions to the Jordanian gross
domestic product (GDP) grew from 2.8
percent in 1997 to 3.5 percent in 2001, and
health-services employment has grown 52
percent since 1997, the report said.
    e international research-based pharma-
ceutical industry has greatly increased direct
employment in Jordan since 2000, according
to the IIPI report. Pfizer said it doubled the
number of its local employees. Sanofi-Aven-
tis and Novartis tripled their local labor
forces, and Merck increased its employment
in Jordan by 500 percent. e IIPI report said
this growing multinational presence contrib-
utes added value to Jordan’s society through
activities such as marketing and distribution,
sales-force training, and educating health-
care professionals and the public. Merck, for
example, held some 75 educational programs
and academic meetings in Jordan in 2004.



30
  A Message from JACKIE CHAN:
                  “Fakes Cost More”





                                                  Jackie Chan, one of the most famous names in martial
                                                  arts and action movies worldwide, in his newest role: the
                                                  scourge of counterfeiters everywhere. At the launch of the
       ounterfeiting is a major growth indus-     “Fakes Cost More” campaign in Hong Kong on June 2, 2005,
       try, with a global market valued at U.S.   Chan showed his disdain for counterfeit goods by chain
$500 billion. Industry sources estimate the       sawing a fake goods store and stripping a mock consumer
                                                  of all his copied clothes and shoes. The next stops in the
worldwide production of counterfeit products      campaign will be Europe and the United States.
to have soared 1,700 percent over the last 10
years. But the most surprising aspect of this
growth is not in the numbers themselves, but      gain: Selling fake milk powder whilst buying
the wide variety of industries that have become   the real milk powder at home. When these
hotbeds for fakes.                                people are caught they really need to be pun-
    ese days, counterfeiting has moved well      ished heavily and made an example of for such
beyond DVDs — including those of movies           terrible crimes.
I’ve made — and handbags. Fake products are           is is why I am taking part in “Fakes Cost
becoming popular in industries such as food,      More,” a global campaign organized by the
medicine, toys, even cars and planes. is is      International Trademark Association (INTA),
enough to cause a threat to our safety, and re-   in hopes of raising awareness around the world
ally quite terrifying to think about it!          in regards to the level of counterfeit goods
    I was horrified to discover the existence     infi ltration and the danger this poses to all so-
of fake milk powder. Everyone knows just          cieties. You can do your part, too, by refusing
how fragile babies are, and they need to be       to buy fakes — because they do cost more, for
protected. ese criminals even use fake milk      all of us.
powder to exploit the public to boost their own

                                                                                               31
                      :
                  How Countries Are
Fighting
      IPR Crime
PERFORMING ARTISTS GROUP WINS IN                     Universal Music estimates that up to 85
BELGIAN COURT                                     percent of the blank recordable digital media



                                                  sold in Belgium is used for downloads of pro-
           Brussels court ruled against an        tected intellectual property, be it music, vid-
           Internet service provider (ISP) in a   eos, movies, or software. e Belgian Anti-
lawsuit brought by SABAM, a Belgian group         Piracy Federation, supported by the Motion
responsible for collecting royalties due per-     Picture Association of America, estimates
forming artists. SABAM claims that this is        that 250,000 protected movies or videos are
the first such successful judgment of its kind    downloaded daily in Belgium.
in Europe. The November 30, 2004, ruling
requires that Tiscali, a small but popular ISP,   BURKINA FASO TARGETS
block certain net services that permit Inter-     COPYRIGHT PIRACY


                                                  
net web surfers to download music protected
by copyright. The judge did not fault Tiscali               urkina Faso, which has a vibrant
management for the activity of its site users,              and significant local music in-
but did find that Tiscali had an obligation to    dustry under assault by cut-rate imported
halt such infractions of copyright.               pirated music products, is fighting back. In
    SABAM says its goal is to turn off the        the fall of 2004, the Ministry of Culture,
peer-to-peer trading of data from users’          Arts, and Tourism and the Copyrights Of-
hard drives when on line, a system used by        fice kicked off a three-day meeting to discuss
popular sites to facilitate music downloads.      anti-piracy strategies against the more than
Defenders of the Internet users and music         10 million pirated cassettes that enter the
traders claim that compliance with the judg-      country each year, 80 percent of them from
ment is technically impossible. ey liken         neighboring countries. The meeting ended
it to asking for an interdiction of CD writer     with the incineration of 17,000 pirated cas-
technology because it could be misused for        settes and CDs seized by the Copyrights Of-
pirating copies of music. Sources at Universal    fice and the Gendarmerie in Ouagadougou
Music in Brussels, one company that has suf-      and Bobo-Dioulasso.
fered heavily from Internet piracy, assert that      Before reporters covering the meet-
the screening technology does exist, and that     ing, Mahamoudou Ouedraogo, minister of
ISP companies could fi lter transmissions         culture, arts, and tourism, called piracy “a
made over their systems.                          cancer” for Burkina Faso and insisted that
                                                  pirates should be prosecuted for their crimes.

32
                                                     South Korea’s pop band, Shinhwa, performing in Japan. Seoul
                                                     amended its Copyright Act so as to stem a drastic slide in its
                                                     music industry’s revenues.




                                                     Pirated compact discs are flooding many countries’ markets,
                                                     hurting local and international artists. These are confiscated
                                                     CDs at Pakistan’s Federal Investigation Agency in Karachi.
A percussionist from Burkina Faso performs at
the Saint Louis Jazz Festival in northern Senegal.
Burkina Faso’s vibrant music industry is suffering
from an onslaught of cut-rate imported pirated
music products.

                                                                                                          33
People shop for music, movies, and other goods at a bazaar
in New Delhi. A New Delhi court issued a warrant in August
2005 that gives police broad powers to search for and seize
pirated movies in any part of the city.




Tallinn, Estonia: The Estonian Organization for Copyright
Protection is partnering with other groups to teach the
younger generation about the importance of IPR.


                                                              More than one million pirated CDs and DVDs were
                                                              confiscated and then destroyed in this September
                                                              15, 2005, anti-piracy crackdown in Jakarta,
                                                              Indonesia.



       34
e director general of the government’s Of-          e Estonian Computer Club, another
fice for the Rights of Authors, in turn, out-     local NGO that boasts about 4,500 members,
lined Burkina Faso’s anti-piracy strategy. e     is using a U.S. Embassy grant to organize
strategy will include setting up an indepen-      several IPR-related seminars and Local Area
dent anti-piracy organization; issuing a com-     Network (LAN) parties for young computer
mon policy with the neighboring countries         users. e seminars will be held in coopera-
to secure the borders against pirated goods;      tion with EOCP and the Business Software
setting up a subregional court in charge of       Alliance.
copyrights; providing intellectual property
rights (IPR) training to judges, gendarmes,       IN INDIA, A LAW FIRM COMBATS PIRACY
police, and customs agents; and pressing          WITH NEW STRATEGY


                                                  
criminal charges against pirates and sellers
of pirated goods, of which there are an esti-               he Mumbai-based law firm of Krish-
mated 100,000 in Burkina Faso. e majority                  na & Saurastri’s new strategy for
of these sellers are street hawkers.              combating copyright infringement in India is
                                                  to use the legal system to inconvenience the
SUPPORTING IPR THROUGH IMPROVED                   pirated material manufacturer through per-
GOVERNMENTNGO COOPERATION                        sistent search-and-seizure tactics and with
IN ESTONIA                                        recurrent civil and criminal litigation.



                                                      According to Sunil Krishna of Krishna &
       stonia’s Police Board and its Customs      Saurastri, their strategy combats violations
       and Tax Board signed a cooperative         in the pharmaceutical, software, audio, and
agreement on December 27, 2004, that al-          music industries. Owing to what Krishna
lows them to improve Estonia’s IPR regime         describes as “the reluctance of local police
through the exchange of information on op-        to pursue” complaints about counterfeited
erations, investigations, and procedures. Both    goods, his firm now has turned to the “Anton
boards also are working more closely with         Pillar” order along with other means to fight
the country’s leading IPR nongovernmental         piracy. e “Anton Pillar” order allows for
organization (NGO), the Estonian Organi-          the appointment of court receivers to search
zation for Copyright Protection (EOCP), in        and seize suspected counterfeit property for
gathering information and securing evidence       custodial purposes without any prior notifi-
on specific cases of IPR infringement.            cation to the alleged perpetrator. e court
   EOCP and other Estonian NGOs also              also orders the police to provide protection
work independently to teach the younger           to the receiver of the goods. Krishna claims
generation about the importance of IPR. Ac-       that this method has proved extremely suc-
cording to EOCP’s managing director, Ilmar        cessful with pirated software.
Harg, Internet piracy is a more worrisome             After the seizure, Krishna says, he can
problem than pirated CDs in Estonia, with         obtain an injunction against the alleged per-
an average of 50 web sites closed each month      petrator. is will prevent additional manu-
because of pirated content. In November of        facturing and/or trading of the counterfeit
2004, the NGO organized a media campaign          products. Violating the court injunction is
in Estonia’s leading newspapers explaining        punishable by a minimum of six months to
the criminal nature of IPR infringement           a maximum of three years’ imprisonment.
on the Internet. e campaign materials            Krishna argues that this sentence serves
reported that, beginning in 2005, the Esto-       as a deterrent against future counterfeiting
nian Police will step up its investigations and   operations.
prosecutions of Internet piracy, and noted            e attorney cites two cases where both
that the Estonian penal code calls for up to      civil and criminal statutes were used in
three years of imprisonment for those found       successfully eradicating a spurious pharma-
guilty of Internet piracy.                        ceutical product. Krishna said this process
                                                  is time-consuming, and involves fi ling hun-
                                                  dreds of cases against the manufacturers of

                                                                                            35
the fake goods. Convinced that it is a suc-           Register each of their production facilities,
cessful strategy “guaranteed” to make the              the production capacity at each facility,
manufacturer or trader of illegal goods close          and manager names at each facility with
up shop permanently, Krishna says that the             the Ministry of Industry.
cost for this approach is less than 5 percent         Hang company signs outside factories in a
of the legitimate turnover of the company              manner that makes them clearly visible to
whose goods are being copied.                          the public.
   Krishna believes the government of In-             Use and have in their possession only
dia could make a few changes that would                those production molds that are engraved
make his job easier. He favors the continual           with government-approved source identi-
education of law enforcement officers about            fication codes (SID).
piracy. He recommends that Indian Customs             Keep records of orders, the quantity of
be empowered to destroy counterfeit goods,             polycarbonate (the material used to make
something they cannot do now. He also                  discs) purchased, numbers of disc copies
suggests that pirated goods coming into or             produced, samples of each batch of discs
going out of India could be prosecuted un-             produced, and copyright agreements.
der the Conservation of Foreign Exchange              Register with an internationally accredited
and Prevention of Smuggling Activities Act.            organization that issues SID codes, such as
e act allows for a one-year imprisonment              the International Federation of the Phono-
without bail for the illegal import or export          graphic Industry (IFPI).
of any good.                                            e regulations provide for the possibility
                                                     of administrative sanctions, specifically the
OPTICAL DISC REGULATIONS NOW LAW                     removal of a producer’s registration. Since
IN INDONESIA                                         the optical disc regulations fall under Indo-



                                                     nesia’s copyright law, they call for criminal
          ormer       Indonesian       President     penalties of up to five years’ imprisonment.
          Megawati Soekarnoputri signed              ese new regulations went into effect on
Indonesia’s first-ever optical disc regulations      April 18, 2005.
on October 5, 2004. The long-awaited regu-
lations require producers to register their          PARAGUAY: USE OF LAWS,
production facilities, maintain and report           ENFORCEMENT TO PROTECT IPR


                                                     
production records, and open their factories
to unannounced police and/or civil service                     araguay moved forcefully in 2004
investigators, among other measures. Then                      with legislation and enforcement
Minister of Industry and Trade Rini Soe-             actions that strengthen IPR protection. For
wandi signed the accompanying implement-             instance, the government worked with the
ing ministerial regulations on October 19,           private sector and supported the introduc-
her last day in office. In anticipation of a deci-   tion of two draft laws that increase penalties
sion by incoming President Susilo Bambang            in criminal cases of IPR violations, one law
Yudhoyono to split the Ministry of Industry          for copyright piracy and the other for coun-
and Trade into two separate ministries, Soe-         terfeiting. The draft laws increase penalties
wandi issued two separate implementing               to five years or more, avoiding provisions for
regulations, dividing issues and responsibili-       crimes with lower penalties that provide the
ties between the two future ministries.              option of paying a fine in lieu of jail time.
    According to a local Indonesian Motion              Paraguay’s Specialized Technical Unit,
Picture Association consultant, who worked           designed to act as an intelligence and inter-
with Indonesian officials in drafting the new        agency coordination unit for IPR enforce-
regulations, these will require existing and         ment, became part of the Ministry of Indus-
future companies with optical disc produc-           try and Commerce, and gained a stronger
tion facilities to:                                  focus on copyright piracy and falsification.
                                                     is unit has participated in a significant
                                                     number of enforcing actions, often in coop-

36
eration with private sector groups. Reviews              e ministry reached agreement in Au-
of company registration data following                gust 2004 with Fox Sports Latin America
increased cooperation (including data shar-           to cooperate in ending the theft of Fox’s
ing) between the ministry and the Customs             programming, among the most popular in
Service led to the closure of 56 importing            Paraguay. e first such agreement signed by
companies and the cancellation of 73 import           Fox in Latin America, it allows Fox and the
licenses.                                             ministry to use the powers of the country’s
   A report prepared by the ministry in Feb-          communications regulator (CONATEL) to
ruary 2005 states that between December               revoke the licenses of companies providing
2003 through January 2004, for instance,              pirated cable signals, a more efficient method
action by the Paraguayan authorities re-              than relying solely on the courts. Since the
sulted in: 11 million virgin CDs confiscated;         agreement was reached, at least four cable
1,600 CD burners confiscated; five cigarette          TV providers have reached accords with Fox
factories raided that were suspected of pro-          and stopped pirating the signals.
ducing counterfeit cigarettes; three printers
raided that were producing cartons and                SOUTH KOREA: BRINGING SOUND
labels for counterfeit cigarettes; four ware-         RECORDING PROTECTION ON
houses raided where counterfeit cigarettes            THE INTERNET INTO THE PUBLIC EYE


                                                      
were stored; 15 operations resulting in the
seizure of various counterfeit products, such                outh Korean media headlines in Janu-
as watches, toys, and cell phones; raids of 10               ary 2005 on the government’s new
TV cable operator companies engaged in                action to protect sound recordings grabbed
piracy of cable signals; two raids in Market          the attention of the Korean public. A drastic
4 in Asunción, with 11 stores raided and the          slide in revenues over the last three years for
confiscation of thousands of pirated CDs and          the music industry in South Korea, including
DVDs; and the investigation of five major or-         both domestic and foreign rights holders,
ganized crime groups that imported CDs for            prompted the government to push through
sound-recording piracy.                               amendments to the country’s Copyright Act
                                                      that require prior permission from rights
                                                      holders before anyone can download music
                                                      from the Internet. In an effort to protect the
                                                      “cultural future” of Korea — especially the




A can of authentic Tsingtao beer (right), from
China, displayed beside two similar products
marketed in Taiwan. A dispute over alleged
piracy erupted when the manufacturer of the
product on the left, under a cooperation accord   Paraguayan workers unload boxes containing smuggled CDs
with Tsingtao, argued that the bottle in the      confiscated during a police action in Asunción, Paraguay.
center was violating his trademark.



                                                                                                     37
Taiwan’s former Premier Yu Shyi-
Kun holds a model of a compact
disc as he attends an anti-piracy
protest in Taipei. The protesters
said rampant piracy of CDs is
threatening the survival of the
island’s music industry.




                       Taiwan pop singer
                        “Black” shows off
                           his anti-piracy
                                   badge.



              “Korea wave” of popular music, TV dramas,       seek prior permission from the rights hold-
              and films that permeates Asia — the govern-     ers. e site lists acts now illegal in Korea,
              ment has been very aggressively raising pub-    including uploading music fi les and other
              lic consciousness about the new rules.          copyrighted works onto web sites, mini-
                  e Ministry of Culture and Tourism          homepages, Internet cafes, or blogs, and
              posted information on its web site to inform    uploading music fi les with the purpose of fi le
              and educate the public regarding the practi-    sharing to closed web sites, mini-homepages,
              cal consequences of the new amendments,         Internet cafes, or blogs. e government’s
              which went into effect January 17. e web       campaign seems to be bearing fruit: Record-
              site unequivocally states that only perform-    ing companies report that they already have
              ers and phonogram producers themselves          received inquiries from some of the smaller
              can transmit their performance or phono-        on-line music services asking for a meeting
              grams over the Internet or other networks. If   to discuss contract details.
              the general public, the users, want to trans-
              mit phonograms over the Internet, they must

              38
   In addition, three National Assembly               e U.S. Embassy in Colombo reports
members are sponsoring a bill to revise Ko-        that its public/private IPR Working Group is
rea’s Copyright Act yet again. e bill would       helping to coordinate private sector support,
grant significant additional rights to produc-     including that of Microsoft, for Sri Lankan
ers and performers, including the right of         authorities’ continuing investigations.
communication to the public. e Ministry
of Culture and Tourism’s Game and Music            TAIWAN STRENGTHENS
Division, in turn, drafted a new Music Pro-        COPYRIGHT LAW


                                                   
motion Bill for consideration by the National
Assembly that would introduce additional                      new law passed by Taiwan’s Leg-
protections for sound recordings, as well as                  islative Yuan on August 24, 2004,
authorize the ministry to set up and run an        closes loopholes in the version they passed
inspection team to investigate and handle il-      in 2003. The new bill makes any technol-
legal phonogram cases.                             ogy or information used for circumventing
                                                   “anti-piracy measures” a crime punishable by
SRI LANKA’S BIGGEST RAID DISCOVERS                 up to one year in prison and/or a fine of up
ILLICIT DISCPRINTING PLANT                        to approximately U.S.$8000. It also allows



                                                   Taiwan Customs to impound goods, pending
           lthough the sale of counterfeit CDs     determination of their authenticity. However,
           and DVDs is common in Sri Lanka,        rights holders must still take measures to ap-
authorities assumed discs on sale were being       ply for attachment and/or initiate criminal or
imported to Sri Lanka from other parts of          civil proceedings to protect their intellectual
Asia. Then, on the night of October 9, 2004,       property rights within three days, or Cus-
Sri Lankan police investigating other crimi-       toms is required to release the goods.
nal activities raided a previously unknown            e 2003 law eliminated minimum sen-
CD manufacturing plant, Optical Media              tences for counterfeiters, giving judges the
Pvt. Ltd. Owned and operated by Malaysian          discretion to allow violators to pay a fine
nationals, the plant had been in operation         instead of serving jail time. Most intellectual
since early that year, ironically as a company     property pirates saw paying these minimal
approved by the Board of Investment, the           fines as a justifiable cost of doing business.
government of Sri Lanka’s foreign investment       e new law mandates that those involved in
promotion agency. The police also raided the       the sale or rent of copyright-infringing opti-
main bazaar in Colombo and confiscated a           cal discs must be imprisoned between six
large number of optical media products. The        months and five years, and also may be fined
news of the raids spread to other counter-         between U.S.$16,100 to U.S.$161,000. 
feit CD sellers, and most of the shops have
stopped displaying counterfeit copies of the
Eagle brand produced by the plant.
    e plant had counterfeited music, movie,
and software products and produced CDs
using polycarbonate resin, which will make
it possible to calculate the number of CDs
and DVDs that were pirated. Informants told
the police that a truck had removed approxi-
mately 175,000 discs and some stampers the
night before the raid. Officials assume that,
because of the large number of discs involved
and the presence of several hundred Chinese
Microsoft discs, the plant must have manu-
factured illegal discs for export as well as lo-
cal consumption.


                                                                                               39
   e U.S.
Approach:
                       Traditional Knowledge,
                       Genetic Resources,
                       and Folklore
                                                  By Jeanne Holden



          U.S. agency negotiates a collab-
           orative agreement with a univer-
sity research organization in Brazil to study
plants in that country as potential sources of
                                                  of traditional knowledge, and preserving
                                                  expressions of folklore, says Linda Lourie, an
                                                  attorney with the U.S. Patent and Trademark
                                                  Office’s (USPTO) International Relations Of-
drugs to fight cancer.                            fice.
    Members of a Native-American tribe cre-           As a country composed of people from all
ate a digital database in which they record       over the globe, as well as more than 560 Na-
all of their community’s cultural knowledge,      tive-American tribes, the U.S. government
history, practices, and arts.                     has had to handle a myriad of concerns re-
    A U.S. corporation seeking to study mi-       garding these often-complex matters. “We’ve
croorganisms in Yellowstone National Park         resolved these issues by national means,”
enters a Cooperative Research and Develop-        Lourie stressed. Some of these solutions uti-
ment Agreement with the U.S. government,          lize existing U.S. intellectual property laws,
stating that any benefits of commercializa-       while others do not. Tribal businesses, for ex-
tion will be shared.                              ample, use established intellectual property
    ough these situations may seem unre-         laws, while Native-American expressions of
lated, they have something in common: All         folklore are protected by other types of laws,
are mechanisms aimed at protecting the            programs, and even museums.
value of genetic resources, traditional knowl-        In the international arena, the United
edge, and folklore, three elements that are       States is at the forefront in developing ben-
often intertwined in daily life in indigenous     efit-sharing agreements with source coun-
communities. A traditional healing remedy,        tries regarding their genetic resources. “We
for example, may involve preparing a local        have consistently led the world in negotiating
plant according to a recipe passed down from      these kinds of arrangements,” she said, “and
generation to generation and consuming it as      we certainly would encourage other coun-
part of a cultural ceremony.                      tries to do so.”
    e United States respects and recog-              e United States is eager to share its
nizes the importance of protecting genetic        experiences with other countries in interna-
resources, traditional knowledge, and ex-         tional fora, said Lourie. “But,” she cautioned,
pressions of folklore by facilitating equitable   “each country has different issues that need
benefit sharing, eliminating erroneously is-      to be resolved differently. One size does not
sued patents, eliminating misappropriation        fit all.”

40
Anthony Morales of the Gabrieleno Native-
American tribe, at a powwow in California. The
United States has developed a host of solutions
to preserve its tribes’ traditional knowledge,
folklore, and genetic resources.




                                      A variety of herbal remedies,
                                  some of which have been traditional
                                        healing remedies for centuries.



WHAT ARE THE ISSUES?                                      Since 1993, the international community



                                                       has been working to better understand and
      n 1993, the Convention on Biologi-               implement Article 8(j) within the framework
      cal Diversity (CBD) came into force.             of the World Trade Organization (WTO)
It represents a commitment by nations to               and the World Intellectual Property Orga-
conserve biological diversity, to use biologi-         nization (WIPO), among others. In these
cal resources sustainably, and to share the            discussions, several developing countries
benefits arising from the use of genetic re-           have advocated creating new forms of legal
sources fairly and equitably. Article 8(j) of          protections for these resources at WIPO.
the convention draws a connection among                In response, WIPO member states estab-
traditional knowledge, folklore, and genetic           lished an Intergovernmental Committee
resources by calling on nations to “respect,           (IGC) as an international forum for discuss-
preserve, and maintain knowledge, innova-              ing the relationship between intellectual
tions, and practices of indigenous and local           property and genetic resources, traditional
communities” and to promote wider applica-             knowledge, and folklore.
tion with the approval of the holders of such
knowledge and practices.

                                                                                                41
    But what is meant by these three terms?          Holders of genetic resources worldwide
Ultimately there is no uniformity in defini-      also are largely focused on the issues of
tions. e term “genetic resources” is defined     “protection,” “preservation,” and “equity,”
in the Convention on Biological Diversity,        although even those terms have not been
Article 2, as “genetic material of actual or      defined uniformly.
potential value.” Genetic material refers to         ere have been calls for the creation of
any material of plant, animal, microbial, or      new international legal protections for these
other origin containing functional units of       resources, but many questions remain unan-
heredity.                                         swered. Who would be the beneficiaries of
    According to the International Bureau         any protection measures created for genetic
of WIPO, “traditional knowledge” refers to        resources, traditional knowledge, or folklore?
systems of knowledge, generally passed from       No country, international intergovernmen-
generation to generation, pertaining to a         tal organization, or person has been able to
particular people or territory, and including     identify the intended beneficiaries of these
their creations, innovations, and cultural        sought-after protection measures. Similarly,
expressions. By definition, some form of          none has determined what the scope of such
traditional knowledge has existed for a long      protection might be, what would constitute
time. However, such knowledge is not static       “fair use” or other exceptions of limitations,
and can be constantly evolving in response to     or even what enforcement mechanisms
a changing environment. Traditional knowl-        could be applied. How would an expatriate of
edge may focus on natural elements such as        an indigenous community from one country
mineral deposits, location of salmon, healing     profit from, or have the right to use, genetic
properties of local plants, land management       resources, traditional knowledge, or folklore
practices, or agricultural technologies.          from her past in her new home? How would
    e term “expressions of folklore” has         combinations of traditions be protected?
also been defined by WIPO for purposes of         What about traditions or knowledge that
its discussions. WIPO says this term refers       span borders or continents or are universally
to characteristic elements of “traditional        practiced?
artistic heritage” developed and maintained          Some countries want to prevent others
by a community or by individuals who reflect      from using their traditions while others want
the traditional artistic expectations of such     to commercialize or profit from such use.
a community. Expressions of folklore may          How could any one system encompass all
be oral, as in folktales; musical, as in songs;   these interests? And, to make matters even
actions, as in folk dances, plays, or rituals;    more complex, there is no agreement as to
or tangible expressions, such as drawings,        what actual harm would be remedied by new
paintings, carvings, sculptures, pottery,         means of protection.
woodwork, metal ware, jewelry, basket weav-          In the United States, tribal enterprises
ing, needlework, textiles, carpets, costumes,     can and do avail themselves of U.S. intel-
musical instruments, and architectural            lectual property laws, said Eric Wilson, an
forms, among others.                              international program analyst with the U.S.
          e concerns of traditional knowl-       Department of the Interior. e Mississippi
edge holders within the United States and         Band of Choctaw, for example, holds annual
other countries include: loss of traditional      seminars for tribal government and tribal
knowledge; lack of respect for traditional        industry managers on intellectual property.
knowledge; the misappropriation of tradi-         e tribe is engaged in manufacturing en-
tional knowledge, including use without           terprises and wants to be able to avail itself
benefit sharing and offensive use; and the        of relevant intellectual property rights (IPR),
need to preserve and promote the use of tra-      he explained.
ditional knowledge. Indigenous communities           e current laws of intellectual property
have many similar concerns regarding their        rights are not enough to cover all the con-
traditional artistic expressions.                 cerns of indigenous peoples, and such laws
                                                  alone cannot be expected to do so, Wilson

42
The National Dance Company of Korea in the traditional dance Janggochum. Some countries want IP
protection for dances and other expressions of folklore. In the United States, other types of laws also
protect folklore.




A Cambodian troupe that performs Khmer classical and folk dance and music.




                                                                                                          43
                                                               A worker near Trombetas, Brazil, with new
                                                               sprouts of native vegetation that will be used
                                                               to reforest and replenish the country’s rich
                                                               genetic resources.




An ethnobotanist examines a specimen from the Brazil nut
at the New York Botanical Garden, which for years collected
plants in Latin America under a program that developed
benefit-sharing with source countries.




                                                               Cecilia Bearchum goes over a binder used to teach
                                                               Walla Walla Native-American vocabulary and
                                                               grammar at the Umatilla Indian Reservation in
                                                               Oregon.
Staff at the University of North Carolina in Chapel Hill’s
Southern Folklife Collection — one of many U.S. institutions
that preserve, protect, and distribute American expressions
of folklore.


           44
stressed. “Indigenous values,” as they are             “However,” Lourie explained, “if our pat-
sometimes called, are quite broad and vary         ent examiners in Virginia do not know about
among the tribal communities, with some            traditional practices overseas, they cannot
interests belonging to an entire tribe, a clan,    protect them.”
or an individual.                                      Lack of information about a traditional
   In order to achieve protection of intel-        remedy led to a problem in 1995 when a U.S.
lectual interests, Wilson suggested that some      patent covering the use of the turmeric plant
of the solutions will need to come from the        in healing wounds was mistakenly granted
indigenous communities themselves. He              to Indian nationals from the University of
said that it would be appropriate for national     Mississippi Medical Center. Turmeric has
governments to give legal recognition to cus-      been used for a long time in India to heal
tomary indigenous law.                             wounds, and this had been documented in
                                                   Indian publications. e Indian Council for
TRADITIONAL KNOWLEDGE                              Scientific and Industrial Research requested



                                                   a reexamination of the patent, and the U.S.
         ne approach taken to respond to           Patent and Trademark Office revoked the
         traditional knowledge holders, said       patent for lack of novelty. e ability of a
Linda Lourie, consists of ensuring that pat-       third party to request reexamination and the
ents are not granted on known products or          eventual cancellation of the claims when a
processes, including those that are consid-        mistake has occurred demonstrate that the
ered traditional knowledge.                        current patent system works well to correct
   A patent is a grant by a national govern-       itself.
ment to an inventor for the right to exclude           e importance of publishing traditional
others from making, using, or selling his or       knowledge and making that information
her invention. To qualify for patent protec-       available to patent examiners internation-
tion in most countries, an invention must be       ally cannot be overemphasized, said Lourie.
new, it must be useful, and it must not be a       “If traditional knowledge is documented,
trivial extension of what is already known.        that knowledge may not be the subject of a
Some holders of traditional knowledge fear         patent, even if it is not widely known in an
that others will seek patents based on their       industrialized country.”
long-held knowledge and reap the benefits              e United States is encouraging other
from it. But an applicant trying to patent         countries to create digital databases to cata-
traditional knowledge likely cannot meet the       log their traditional knowledge and protect
three necessary requirements, Lourie said.         it from patent attempts. Digital databases
“Traditional knowledge is already known,           would allow patent examiners all over the
so if it has been documented; it’s no longer       world to search and examine traditional
new.”                                              knowledge. Several developing countries
   According to the U.S. Patent Act (Title         are working toward this end. India and
35 U.S. Code, Section 102), if an invention a)     China have been very involved in develop-
was known or used by others in the United          ing searchable digital libraries of their tra-
States, or patented or described in a printed      ditional knowledge, Lourie said. U.S. patent
publication in this or a foreign country be-       examiners regularly check the international
fore the invention thereof by the applicant for    databases that are already in use.
patent, or b) was patented or described in a           Lourie acknowledged that some tradi-
printed publication in this or a foreign coun-     tional knowledge holders might want to keep
try or in public use or on sale in this country,   certain aspects of their knowledge secret
more than one year prior to the date of the        or limited to specific individuals or groups.
application for patent in the United States,       If so, she said, they may want to take steps
then it is not entitled to a patent.               to guard their knowledge as a trade secret.
                                                   In the United States, infringement of a
                                                   trade secret is considered a type of unfair
                                                   competition.

                                                                                              45
   Within the United States, some Na-                  FOLKLORE


                                                       
tive American tribes are cataloging their
tribal values in a way that fulfi lls the need for             n the United States, expressions of
documentation and the need to limit outsid-                    folklore are protected in a variety of
ers’ access to information. According to Eric          ways, ranging from standard U.S. intellec-
Wilson, the Tulalip Tribes in the U.S. state           tual property laws to laws and programs spe-
of Washington, for example, have developed             cifically designed to protect and preserve the
a sophisticated digital computer inventory,            cultural heritage of its indigenous peoples.
named “Cultural Stories,” that delineates                  One mechanism is the Indian (Native
who is to have access to what traditional              American) Arts and Crafts Act, a federal law
information about their knowledge, history,            enacted in 1935 and amended in 1990. is
culture, or practices. Some users have unlim-          truth-in-advertising law prohibits the mar-
ited access, while others, such as U.S. patent         keting of products misrepresented as Native
examiners, may have limited access.                    American-made. It covers all Indian and In-
   Some holders of traditional knowledge               dian-style traditional and contemporary arts
want to be sure that any new discoveries               and crafts, such as baskets, jewelry, masks,
derived from their traditional knowledge in-           and rugs. An individual or business violating
clude an equitable sharing of benefits. ese           the act can face civil penalties or criminal
communities may want to negotiate contrac-             penalties or both.
tual benefit-sharing agreements regarding                  e Database of Official Insignia of Na-
new products or processes created through              tive-American Tribes was established at
research using their traditional knowledge.            the USPTO in 2001 in response to Native-
Lourie cautioned, however, that it could be            American concerns about the preservation of
a mistake to expect a windfall from such               expressions of folklore. Official insignia are
contracts; to date, very few financial benefits        not trademarked designs; they are insignia
have accrued from commercialization of tra-            that various federally and state-recognized
ditional knowledge.                                    Native-American tribes have identified as
                                                       their official tribal emblem. Inclusion of of-
                                                       ficial insignia in the database ensures that an
                                                       examining attorney will be able to identify




                                 Left, a woman from Almolonga, Guatemala, using a traditional design
                                 in her weaving. Above, young students from the Beijing Shaolin Kung
                                 Fu School. Monks from the Shaolin monastery in Henan province —
                                 considered the cradle of Chinese martial arts — are trying to protect the
                                 Shaolin trademark from encroachment by marketers who use it to push
                                 products ranging from medicine to cars and furniture.
46
any official insignia that may preclude regis-   grassroots cultures in the United States and
tration of a mark where the mark suggests a      abroad. Its collection includes many thou-
false connection with the tribe.                 sands of commercial discs, audiotapes, com-
   In addition, all trademark applications       pact discs, still images, videotapes, and mo-
containing tribal names, recognizable like-      tion picture fi lm. It produces annual folklife
nesses of Native Americans, symbols per-         festivals, recordings, exhibitions, documen-
ceived as being Native American in origin,       tary fi lms, and educational materials.
and any other application that the USPTO             e newest U.S. effort to protect and
believes suggests an association with Native     preserve Native-American culture is the
Americans are examined by an attorney at         Smithsonian Institution’s National Museum
the USPTO who has developed expertise and        of the American Indian, which opened in
familiarity in this area.                        Washington, D.C., on September 21, 2004.
   e U.S. government has taken several          It is the first national museum in the United
other steps to protect and preserve its peo-     States dedicated to the preservation, study,
ples’ expressions of folklore. e American       and exhibition of the life, languages, history,
Folklife Center in the Library of Congress       and arts of Native Americans.
was created in 1976 by the U.S. Congress
“to preserve and present American folk life”     GENETIC RESOURCES


                                                 
through programs of research, documenta-
tion, archival preservation, live performance,            hroughout the world, many com-
exhibition, public programs, and training.                munities are focusing on issues of
e center incorporates the Library’s Ar-         equity as well as protection and preserva-
chive of Folk Culture, established in 1928       tion of resources. Those communities have
as a repository for American folk music. e      expressed their concern that industrialized-
center holds more than 1,000,000 photo-          country companies could utilize source-
graphs, manuscripts, audio recordings, and       country natural resources for agricultural
moving images.                                   and pharmaceutical products and assert
   e U.S. government also maintains the         intellectual property rights claims.
Smithsonian Center for Folklife and Cultural
Heritage to promote the understanding of




The National Museum of the American Indian in        The Jefferson Building of the Library of Congress.
Washington, D.C.                                     Congress created the Library’s American Folklife Center
                                                     “to preserve and present American folklife.”



                                                                                                 47
   Many others believe that such concerns              is was the program in which NCI first
have been overstated. Where the U.S. gov-          developed policies for benefit-sharing with
ernment, including the National Cancer             source countries. “We began letting out con-
Institute (NCI), is involved in genetic re-        tracts to high-quality research organizations
source research in other countries, it enters      in the United States for collections overseas,”
into benefit-sharing agreements with those         explains Bjarne Gabrielsen, senior advisor
countries to gain fair access to genetic re-       for drug discovery and development in NCI’s
sources and/or traditional knowledge, said         Technology Transfer Branch. “e Missouri
Linda Lourie. “ere are many success               Botanical Garden collected plants in Africa,
stories” involving collaborative agreements        the New York Botanical Garden collected in
and contracts for cooperation negotiated on        Latin America, the University of Illinois in
mutually beneficial terms.                         Chicago collected in South Asia,” he said.
   “NCI was ahead of the Convention on Bio-        “e collections were done mainly in tropical
logical Diversity by about three or four years”    and subtropical countries, mainly developing
in negotiating agreements with source coun-        countries.”
tries regarding their resources, says scientist        At this stage, Cragg’s program started
Dr. Gordon Cragg.                                  using Letters of Collection, agreements
   Cragg, chief of the Natural Products            among NCI, a U.S. contractor organization,
Branch of NCI’s Developmental erapeutics          and a collecting organization in the source
Program, explained that, in the 1980s, NCI         country. “e U.S. contractor goes into an
started developing policies for collaborating      area, obtains the necessary permits, and
with source countries on the use of their ge-      collects plants and marine organisms for
netic resources in research aimed at finding       us” with the source country organization,
more effective treatments for cancer. ese         said Gabrielsen. “e NCI does the extrac-
agreements provided the source countries           tion and testing.” In addition to short-term
with short-term benefits that would accrue         benefits, NCI requires that, if a promising
without having to wait and see whether             potential drug is discovered and licensed to a
promising discoveries were derived from            pharmaceutical company, the company must
their resources. e benefits included train-       negotiate an agreement so that benefits, such
ing source-country scientists in NCI labora-       as part of the royalties, will be returned to
tories or U.S. universities’ laboratories and      the country.
technology transfer, he said.                          Over time, in response to the Convention
   “e chances of a discovery becoming a           on Biological Diversity and to greater aware-
commercial product is usually said to be one       ness on the part of source countries about
in 10,000,” said Cragg, adding, “I think that is   the value of their resources, research orga-
optimistic.”                                       nizations and pharmaceutical companies in-
   NCI, part of the U.S. National Institutes       creasingly have adopted policies of equitable
of Health, one arm of the U.S. Department of       collaboration and compensation.
Health and Human Services, functions much              In this, too, NCI has been a leader. In the
like a non-profit pharmaceutical company.          1990s, NCI de-emphasized its collections in
Established in 1937, NCI had evolved by the        its plant-derived drug discovery program in
1950s into a drug research and develop-            favor of expanding closer collaboration with
ment center, collecting plants mostly in the       qualified source-country scientists and orga-
United States, Mexico, Canada, and parts of        nizations under agreements called Memo-
Africa and Europe. In the 1980s, NCI began         randa of Understanding.
a collection program for plants and marine             “Where source-country organizations
organisms in tropical regions.                     have the skills, expertise, and knowledge
                                                   and some reasonable infrastructure in their
                                                   labs, we support them by helping them
                                                   further their own drug discovery research
                                                   programs,” said Cragg. For example, he said,
                                                   NCI’s Developmental erapeutics Program

48
has provided a research organization at the          “e U.S. view of protection of genetic re-
Federal University of Ceara in Fortaleza,         sources,” Lourie said, “is to encourage other
Brazil, with the training and cancer cell lines   countries to establish appropriate access and
to establish their own cancer drug discovery      benefit-sharing regimes that provide benefit
program. is group is now screening mate-         sharing on mutually agreed terms.” Some
rials from research programs all over Brazil.     countries develop policies limiting access by
   “We have five such agreements in Brazil,”      creating so many barriers as to almost pro-
said Cragg, as well as collaborations with        hibit collaboration, thus ruling themselves
organizations in Australia, Bangladesh,           out of the potential benefits of collaboration,
China, Costa Rica, Fiji, Iceland, South Korea,    said Cragg.
Mexico, New Zealand, Nicaragua, Pakistan,
Panama, Papua New Guinea, South Africa,           CONCLUSION


                                                  
and Zimbabwe.
   rough this type of collaboration, the                   he United States has developed
developing-country organization may make                    a wide variety of mechanisms to
a promising discovery in-country, said Cragg.     respond to concerns regarding the protec-
Even if they send NCI a sample for more ex-       tion of traditional knowledge, folklore, and
tensive testing, such testing is regarded as      genetic resources. In the U.S. view, intellec-
routine and NCI makes no intellectual prop-       tual property laws are and should continue
erty claim, he said. “e results are sent back    to be available to indigenous individuals and
to them and the source-country organization       peoples who meet the appropriate criteria for
can take out the patent, if appropriate.          such legal protection.
   “To our minds,” stressed Cragg, “it is an          e U.S. government supports the ex-
ideal process. ... If a pharmaceutical com-       change of views on traditional knowledge,
pany wants to use the discovery and the           expressions of folklore, and genetic re-
source-country organization has the patent,       sources in international fora, particularly in
it must negotiate a licensing agreement and       WIPO, which has the necessary expertise
the source-country organization can dictate       and resources to tackle these complex and
[the] terms.                                      technical issues. WIPO activities have in-
   “By establishing these close collaborations    cluded fact-finding missions, case studies
aimed at developing promising treatments          and surveys, sample contractual clauses, and
for the U.S. and global cancer population,        examples of databases.
we achieve NCI’s mission and also the goals           U.S. experts agree that intellectual prop-
of the Convention on Biological Diversity,”       erty protections do not offer a solution for
said Cragg. “e source country is deriving        all of the issues involved in the protection,
significant benefit.”                             preservation, promotion, and use of tradi-
   Linda Lourie pointed out that the U.S.         tional knowledge, expressions of folklore,
government also requires a contract when          and genetic resources worldwide. In the U.S.
companies want to collect genetic resources       view, however, the key to resolving these
from federally owned lands or from the ap-        issues satisfactorily is a solutions-oriented
proximately 56 million acres of land the          approach rooted in each country’s national
federal government holds in trust for U.S.        context. 
tribes and individual Native Americans. For
example, in order to study unique microor-
ganisms in the hot springs of the U.S. gov-
ernment-owned Yellowstone National Park
that can withstand great heat, researchers
must enter into a Cooperative Research and
Development Agreement (CRADA) with the
U.S. government that includes benefit shar-
ing, with milestone payments if the results
are commercialized, she said.

                                                                                              49
                                      e Challenge of

                   Copyright in the
                       Digital Age
SECTION II: LAWS IN EVOLUTION




                                                                                  By Marybeth Peters




                                      ince its inception, copyright law has
                                       responded to technological change.
                                Today, the changes that are grabbing all
                                the headlines relate to digital technology
                                                                                  for copyright law, including the following:
                                                                                   Ease of Reproduction: Once a work is
                                                                                     rendered in digital form, it can be repro-
                                                                                     duced rapidly, at little cost, and without
                                and digital communications networks, such            any loss of quality. Each copy, in turn, can
                                as the Internet and personal computers.              be further reproduced, again without any
                                These technologies, like many innovations,           loss of quality. In this way, a single copy of
                                are both promising and potentially harmful           a work in digital form can supply the needs
                                to various parties interested in the use and         of millions of users. We have seen how the
                                exploitation of works of authorship, from            compact discs (CDs) containing the origi-
                                books and music to films and web pages.              nal digital versions of recorded music and
                                There is no doubt that the issues related to         sold to consumers in the ‘80s and ’90s have
                                achieving the right balance between these            become the “masters” from which billions
                                interests in light of recent developments are        of copies have been made and distributed
                                daunting and justifiably can be described as         on computers and on the Internet in this
                                “new” or “unique.” But, at the same time, they       decade.
                                are merely one step in a journey of continual      Ease of Dissemination: e emergence
                                and successful adaptation that character-            of global digital networks allows the
                                izes the history of copyright law. This article      rapid, worldwide dissemination of works
                                examines some of the digital issues faced by         in digital form. Like broadcasting, digital
                                copyright law today.                                 networks allow dissemination to many
                                                                                     individuals from a single point (although,
                                CHARACTERISTICS OF DIGITAL                           unlike broadcasting, digitized materials
                                TECHNOLOGIES WITH                                    need not reach each individual simulta-
                                COPYRIGHT IMPLICATIONS                               neously). However, digital networks allow


                                
                                                                                     each recipient on the network to engage
                                         he technologies that presently are          in further dissemination of the work,
                                         raising issues for copyright law are        which can cause the work to spread at a
                                those related to digital storage and transmis-       geometric (sometimes called “viral”) rate
                                sion of works. There are a number of aspects         of increase. is, combined with the ease
                                to these technologies that have implications         of reproducing works, means that a single

                                50
                                                                 Copyright law in the United States and in other
                                                                 countries is coming to grips with new digital
                                                                 technologies and communications networks, such
                                                                 as the Internet and personal computers.




                                                          U.S. Federal Bureau of
                                                          Investigation (FBI) anti-
                                                          piracy warning text, for
                                                          display on digital and
                                                          software intellectual
                                                          property.



  digital copy of a work can be multiplied           grams or sound recordings with aggregate
  many thousands of times around the                 retail values in the millions of dollars. To-
  world within a few hours. When trans-              day’s popular iPod portable music player
  mitted through high-speed transmission             can store nearly 70 times that amount
  lines, like coaxial cable networks or even         (around 10,000 songs) in a device the size
  fiber optic lines, the process is even faster,     of a cigarette pack.
  and the capacity for the transmission of
  works grows as well.                             NEW FORMS OF EXPLOITATION … AND
 Ease of Storage: Digital storage is dense,       ILLICIT COMPETITION


                                                   
  and it gets denser with each passing year.
  Ever-increasing quantities of material can               he revolution in the way new tech-
  be stored in a smaller and smaller amount                nology can reproduce, disseminate,
  of space. In the early 1990s, CDs, which         and store digital information, including
  can store over 600 megabytes of data, were       copyrighted works, is truly a double-edged
  perhaps the predominant form of digital          sword for authors and rights holders. On the
  storage used by commercial pirates for           one hand, it can provide for new and exciting
  storing entire libraries of computer pro-        ways for authors to provide copies of their

                                                                                                51
         works in convenient, inexpensive ways to a             COMMON THEMES


                                                                
         much larger audience than in the past. For
         example, a recording artist can put his or                      his article mentions several com-
         her music on a web site that can be accessed                    mon themes in the approach that
         by fans from around the globe, without a               the copyright law of the United States took
         large investment in manufacturing, packag-             to past technological changes, and how chal-
         ing, and shipping physical products to these           lenges posed by those once-new technologies
         remote locations. On the other hand, these             were addressed.
         new technologies make it easier for pirates
         and those who want to compete illicitly with           Embracing New Forms of Expression:
         that author to make and distribute infringing             Time and again over the last two cen-
         copies of the work.                                    turies, the subject matter of copyright has
            e challenge of copyright in the digital            embraced new forms of authorship. Photog-
         age is to preserve the author’s and rights             raphy, cinematography, electronic databases,
         holder’s incentive to create new works and             and computer programs are some examples.
         use new technologies to distribute them                In each case, policy-makers ultimately were
         to users and consumers in the face of such             able to look beyond the particular technol-
         a competitive threat from the illicit use of           ogy or medium of expression in order to
         technology by infringers. It also involves             recognize the common thread of creative au-
         making sure that beneficial uses of works are          thorship that runs through all of copyright.
         not being needlessly stifled by a copyright
         system rendered inefficient by the advance             Maintaining the Framework of
         of new technology. is article describes               Exclusive Rights:
         how the United States has met this chal-                  A fundamental tenet of both national and
         lenge in the past, and how it may meet it in           international systems of copyright is that
         the future.                                            authors are entitled to exclusive rights over
                                                                certain activities (e.g. reproduction, distribu-
                                                                tion, or performance) involving their creative




 U.S. official William Lash III shows pirated copies of   A billboard for the Apple iPod, which can store around
DVD movies to journalists. Once a movie is rendered       10,000 songs, nearly 70 times the amount that CDs can
in a digital form, it is easy for commercial pirates to   hold.
reproduce it rapidly and at little cost.




         52
works. ese rights allow the author to pre-                At the same time, legislators have had to
serve both his economic and non-economic                examine the nature and scope of exemptions
interests in his creative works, which, in              from exclusive rights. For example, the limit-
turn, promotes literary and artistic creativ-           ed exemptions for reproduction of computer
ity and benefits the public welfare. is same           programs contained in Section 117 of the U.S.
principle is recognized in a provision of the           Copyright Act were considered an appropri-
U.S. Constitution authorizing Congress to               ate means of tailoring exclusive rights to the
grant exclusive copyrights “To promote the              need of that technology, namely, the need to
Progress of Science and useful Arts.” As new            make copies in the course of authorized use
technologies have expanded the means by                 and the need to make backup copies to guard
which works may be exploited, policy-mak-               against mechanical failure or accidental
ers periodically have had to reexamine the              erasure. Similarly, in 2002, the United States
exclusive rights granted to authors under               revised and adapted exemptions for educa-
copyright, to ensure that authors and owners            tional use of works to accommodate new
of copyright continue to exercise exclusive             “distance learning” technologies that allow
control over their works.                               teachers to reach students via communica-
    On occasion, a more expansive interpreta-           tions networks like the Internet.
tion of existing rights is the answer. In the              In short, new technologies often prompt
United States, for example, an existing right           debate about whether the set of exclusive
of public performance was interpreted to                rights granted to authors and rights hold-
include radio and television broadcasts. On             ers should be modified, either with new or
other occasions, new rights have been added             broadened rights or new or broadened ex-
to the copyright bundle, as when rights of              emptions, to continue to serve the purpose
communication to the public were added to               of copyright.
the primary international copyright treaty,
the Berne Convention, in response to the
advent of broadcasting.




U.S. rapper Ludacris surveying his songs on a pay-for-download music site.


                                                                                                   53
Market-Driven Solutions:                           works, is another approach to purported in-
    One reason that a system of exclusive          efficiencies of the marketplace. For example,
rights like copyright has been so successful       in the United States, Sections 111 and 119 of
throughout history at providing the means          the Copyright Act grant compulsory licenses
to support creative activity is that it allows     for the retransmission of broadcast television
copyright owners to rely on the marketplace        signals because of the high transaction costs
to find financial support for their creative       associated with obtaining necessary permis-
endeavors. In particular, where technologi-        sion for such retransmissions.
cal change is very rapid, the flexibility of the       e U.S. experience in this area has
marketplace is often the most efficient way to     shown, however, that the best forms of col-
make sure that works continue to be created        lective management of copyright are those
and disseminated to the public.                    that retain as many characteristics of a
    Any marketplace will have its inefficien-      marketplace of exclusive rights as possible.
cies, however, and it is a challenge for coun-     is requires that any system of collective
tries to try to address them. For example, an      administration be voluntary, non-exclusive,
exclusive right does not necessarily benefit a     and responsive to market forces (including
rights holder if inefficiencies in the market-     market forces brought on by technologi-
place make the exercise of the right impracti-     cal change). All three of these factors point
cable. e exploitation of public performance       toward private entities operating within a
rights in musical works is a classic example in    competitive environment for collective ad-
the United States. Typically, the value of any     ministration of rights. In addition, the third
single public performance of a musical work        factor suggests that collective administration
is small. e class of users, which includes        of rights should be decentralized in order to
broadcasters, bars, restaurants, supermar-         account for different market conditions in
kets, and the like, is extremely large. In ag-     different countries.
gregate, the value of this form of exploitation        Moreover, the imposition of a compul-
is substantial, but so is the cost of adminis-     sory license administered by the government
tering rights over such a large base of users.     can be costly to society. First, a compulsory
    is inefficiency of the marketplace has        license is a significant derogation from the
largely been overcome in the United States         norm of exclusive rights. Second, a compul-
through a familiar market-driven solution:         sory license can cause significant distortions
collective administration of the right of pub-     in the marketplace, since it serves to control
lic performance. In this system, collecting        prices, both directly through the mecha-
societies collect license fees from each user      nisms for setting royalty rates and indirectly
and then distribute these payments to the          through the control of supply. ird, once a
writers and publishers. For example, in the        compulsory license has become established,
United States, performing rights societies         a web of reliance interests builds up around
such as the American Society of Compos-            it, making it extraordinarily difficult to elim-
ers, Authors, and Publishers (ASCAP) and           inate even after the conditions that justified
Broadcast Music, Inc. (BMI), grant blanket         its adoption cease to exist.
public performance licenses to many ven-               For all of these reasons, compulsory
ues and distribute the income from these           licenses are permitted sparingly under in-
licenses to their members.                         ternational copyright treaties and should
    A similar approach is being attempted for      be approached with great caution at the na-
administering reproduction rights — pho-           tional level. Market failure, such as in the
tocopying, electronic copying — with some          cable and satellite retransmission market
success. For example, in this area the Copy-       where transaction costs are prohibitively
right Clearance Center has fi lled a void in the   high, may be one justification for use of a
marketplace and acts as mediator to license        compulsory license.
a wide range of uses. Compulsory licensing,
where the government creates and admin-
isters a license for the use of copyrighted

54
Members of the rock band Transmatic, who signed
a deal with Virgin Immortal Records after being
“discovered” in cyberspace.




A digital camera from Kodak, one of the many
companies that are offering new products and services
for the digital age, including Picture CD software and
on-line photo-sharing services.




                                Chinese pop singer Zhang
                                     Jie in Beijing April 19,
                                  2005, during an event to
                                 promote a Chinese music
                                distribution platform that
                                  adheres to international
                                           IPR standards by
                                promoting distribution of
                                      legitimate products.


                                                                55
EARLY CHALLENGES                                     Under the WCT, countries must put ef-



                                                  fective legal remedies in place against the
         he advent of digital technology          circumvention of technological measures
         posed a number of challenges to the      that owners use to safeguard their rights.
international copyright community.                Countries must also provide legal remedies
                                                  against persons who delete or alter rights
Maintaining the Framework of                      management information attached by the
Exclusive Rights                                  copyright owner to the work. In the United
    Because of the degree to which advances       States, the principal change to U.S. law
in digital technology have facilitated rapid,     in the legislation implementing the WCT
widespread reproduction and dissemination         was the addition of provisions on techno-
of works, the international community has         logical adjuncts to copyright protection.
paid significant attention in recent years to     Title I of the Digital Millennium Copyright
the need to adjust the existing framework         Act (DMCA) created a new form of liability
of exclusive rights to address issues of new      for circumventing technological measures
technology. e conclusion internation-            that restrict access to protected works,
ally has been that the existing framework is      or that control reproduction, distribution,
generally adequate to accommodate the new         public performance, or public display of pro-
technologies and needs minor revisions rath-      tected works.
er than a major overhaul. is is reflected in        e WCT, therefore, recognizes that own-
the modest, though important, scope of the        ers cannot rely on technological measures
WIPO Copyright Treaty (WCT), concluded            alone to protect their works, because every
shortly after digital technology started to       technical device can be defeated by some-
become prevalent.                                 one who is determined to access a work. In
    e WCT requires member countries to           other words, while the framework of existing
recognize certain exclusive rights designed       property rights continues to be appropriate,
for activity that takes place over new digital    the meaningful exercise of these rights in
communications networks like the Internet.        the context of new uses, such as those on the
Among other things, it requires that authors      Internet, requires supplementing them with
enjoy a right of communication to the public,     legal rules that prohibit the compromise of
including the right of “making available” their   their technology.
works, such as providing downloads from an
Internet web site. While many existing copy-      Markets and Management of Rights
right laws provide such a right through the           As discussed above, collective manage-
more traditional rights of reproduction or        ment of rights is a market response to the
performance, the WCT made clear that such         inefficiencies of individually licensing rights
a right, in whatever form, must be granted to     to large numbers of works to large numbers
authors.                                          of users, where the value of any individual
                                                  use is relatively small. Traditionally, indi-
Technological Adjuncts to                         vidually licensing such works would result
Copyright Protection                              in transaction costs that exceed the value of
    While the WCT leaves the existing             the license.
framework of exclusive rights largely intact,         At first blush, collective management of
it does contain provisions, relatively new to     rights appears to be an attractive approach
international copyright agreements, on tech-      to managing rights to at least some works
nological adjuncts to copyright protection.       on digital networks. It’s unclear, however, to
ese adjuncts are intended to further the         what extent the same conditions apply. e
development of digital networks by ensuring       information infrastructure that permits rap-
that copyright can be meaningfully enforced       id, inexpensive dissemination of works may
and licensed online.                              also enhance the ability of rights holders to
                                                  manage rights individually. e private sec-
                                                  tor currently is working to create technolo-

56
gies that facilitate individual transactions be-   Aimster, Grokster, Morpheus, and Kazaa,
tween rights holders and users. e intensive       provided software and services to users, and
use of automation could reduce the cost of         earn advertising dollars based on the size of
such a transaction to levels that would make       the audience the infringing activity attracts.
individual rights management economically          Secondary liability doctrines have long been
feasible. Alternatively, or additionally, such     part of the U.S. common law of copyright.
technologies could be used within a frame-         ey provide an effective means of enforce-
work of collective management as a supple-         ment by placing liability on those who are
ment to traditional blanket licenses.              benefiting from the infringement and are
   For these technologies to meet their full       in a position to control or restrain it. ese
potential in the marketplace, however, they        doctrines may play a much more important
must be allowed to develop with minimal            role in copyright in the future, as more and
interference. Market forces — and not              more technological developments permit
governments — must determine whether               companies to take advantage of individuals’
collective management of rights, individual        infringing activity.
management of rights, or some combination             e various cases brought against such
prevails.                                          companies suggest the courts may be having
                                                   trouble finding the appropriate standard for
FUTURE CHALLENGES                                  secondary liability in the digital age. In the
                                                   United States, the prospect of secondary li-
Determining the Proper Scope of                    ability for copyright infringement tradition-
Secondary Liability in the Digital Age             ally was an important safeguard that dis-
    Another interesting facet of the rapid         couraged businesses from using copyrighted
evolution of digital technologies in the past      works as a “draw” for customers without
decade is the personal nature of the new           permission. is prospect of liability, how-
technology. A single individual, with very         ever, had to be balanced by the courts with
little investment, now can copy and distrib-       freedom to engage in largely unrelated areas
ute millions of copies of works over the In-       of commerce.
ternet, especially works that can be digitized        e U.S. Supreme Court addressed these
easily, like music or motion pictures or pho-      issues more than 20 years ago in the case of
tographs. In the United States, we have seen       Sony Corp. of America v. Universal Studios,
companies deploy peer-to-peer networking           Inc. Ever since then, this case has guided the
technology to take advantage of this fact,         courts in the proper application of the doc-
essentially enlisting millions of consumers        trine of contributory infringement. Sony in-
into a network of copyright infringement on        volved the sale of the Betamax videocassette
a scale never seen before. e fact that the        recorder, which purchasers used to “time-
activities of many individuals can cause mas-      shift,” that is, to record broadcast television
sive, large-scale infringement raises serious      programming for viewing at a later time. e
questions about enforcement. It is quite dif-      Court found no contributory liability, saying
ficult for copyright owners to identify, locate,   that there would be no such liability as long as
and bring enforcement actions against the          a product was capable of “commercially sig-
vast number of individuals who might be in-        nificant” or “substantial non-infringing uses.”
fringing their works. And even if the owners       Since the Court found that the predominant
could bring such actions, it is unlikely that      use of the Betamax was non-infringing, it did
such individuals would be able to pay for the      not need to further clarify what it meant by
damage their actions have caused.                  “substantial non-infringing uses.” However,
    In an effort to address efficiently the        the Court did acknowledge that copyright
infringement in these circumstances, U.S.          owners are entitled to effective, not “merely
copyright owners have turned to doctrines          symbolic,” copyright protection.
of secondary liability to hold the facilitators
of these networks liable for the infringement.
ese companies, such as the old Napster,

                                                                                                57
    Most recently, in MGM Studios v.               also provides that individual with the ability
Grokster, the U.S. Supreme Court addressed         to become an author by creating and dis-
whether the providers of peer-to-peer soft-        seminating her own works. Often that author
ware could be held liable under secondary          would like to use some of the material he or
copyright liability theories. e Court ruled       she might find, but is unsure of the copyright
unanimously that such providers could be           status of a work or whom to ask for permis-
held liable if they “distribute a device with      sion. As we described above, collective li-
the object of promoting its use to infringe        censing of works can help such an author by
copyright, as shown by clear expression            providing efficient mechanisms so he or she
or other affirmative steps taken to foster         can obtain permission to use works.
infringement.” In other words, if a tech-             ere may be, however, some or even
nology provider induces its customers to           many works for which the author cannot
infringe copyrights, it can be held liable for     find an owner or an administering collec-
that infringement. e Court instructed             tive agency, and he or she cannot resolve
lower courts to examine all the facts and          the question of whether the copyright law
circumstances to determine whether such            permits or prohibits using such works. One
inducement took place, and held that the rule      challenge for the future is how the law should
in the Sony case does not prevent liability        treat these so-called “orphan works.” If it is
where the defendant has been found to have         truly the case that the copyright owner of
induced infringement. is rule should allow        such a work no longer cares about its subse-
copyright owners to obtain effective enforce-      quent use, then such use should not be re-
ment of their copyrights against software          strained merely because of uncertainty about
and service providers who seek to encour-          a work’s status. is result would deprive the
age and profit from copyright infringement.        public of access to a new and productive use
Many commentators have already called this         of the work, which is ultimately the goal of
case one the most important in the history of      any efficient copyright system.
U.S. copyright law.                                   In the United States, the Copyright Office
    As an international matter, there is very      has begun an inquiry into the orphan works
little uniformity among national laws as to        question to determine the nature and scope
secondary liability, whether it be liability for   of the problem and what legal or regula-
a company that uses peer-to-peer technology        tory solutions might be needed to address it.
to encourage infringement, or, as the United       Other countries, including Canada, have
States addressed in Title II of the DMCA, an       already developed mechanisms for issues
Internet service provider that provides facili-    related to orphan works. Part of the chal-
ties used by others to infringe. is may be        lenge in addressing such a problem is ensur-
an area that warrants examination concern-         ing that it is fully consistent with and does
ing international standards for such liability,    not derogate from the legitimate interests
especially given the global nature of the In-      of authors and rights holders, and that it
ternet, where a company can set up an in-          complies with international copyright rules
fringement-facilitating operation that serves      that prohibit the imposition of formalities
customers throughout the world from one            that are a condition to the enjoyment and
country. Maintaining effective protection          exercise of copyright. 
for copyright in the digital age might require
such international standards.

Reducing Inefficiencies for                        Marybeth Peters is the Register of Copyrights, U.S.
Subsequent Users                                   Copyright Office, Library of Congress.
   As we have seen over the past decade, the
Internet provides the individual with access
to a vast reservoir of information of all types,
from text to photographs to music to audio-
visual works. Moreover, digital technology

58
                 WHAT IS “FAIR USE”?


“         air use” is an exception to the exclu-
          sive protection of copyright under
American law. It permits certain limited uses
without permission from the author or owner.
                                                        e distinction between “fair use” and
                                                     infringement may be unclear and not easily
                                                     defined. ere is no specific number of words,
                                                     lines, or notes that may safely be taken without
Depending on the circumstances, copying              permission. Acknowledging the source of the
may be considered “fair” for the purpose of          copyrighted material does not substitute for
criticism, comment, news reporting, teaching         obtaining permission.
(including multiple copies for classroom use),          Keep in mind that, even in an educa-
scholarship, or research.                            tional setting, it is not “fair use” to copy for a
    e 1961 Report of the Register of Copy-          “commercial motive” or to copy “system-
rights on the General Revision of the U.S.           atically,” that is, “where the aim is to substi-
Copyright Law cites examples of activities that      tute for subscription or purchase.” No factor
courts have regarded as “fair use”: “quotation       by itself will determine whether a particular
of excerpts in a review or criticism for pur-        use is “fair.” All four factors must be weighed
poses of illustration or comment; quotation          together in light of the circumstances. See the
of short passages in a scholarly or technical        U.S. Copyright Office’s Copyright Information
work, for illustration or clarification of the       Circulars and Form Letters for “Circular 21
author’s observations; use in a parody of some       — Reproductions of Copyrighted Works by
of the content of the work parodied; summary         Educators and Librarians.”
of an address or article, with brief quotations,
in a news report; reproduction by a library          FOR CLASSROOM USE, HOW DOES
of a portion of a work to replace part of a          “FAIR USE” APPLY?
damaged copy; reproduction by a teacher or              e Internet magnifies the possibility for
student of a small part of a work to illustrate      making an infinite number of perfect copies,
a lesson; reproduction of a work in legislative      which changes what it means to be “fair.” Be
or judicial proceedings or reports; incidental       careful when using material from the Internet;
and fortuitous reproduction, in a newsreel or        keep in mind the four factors of the “fair use”
broadcast, of a work located in the scene of an      test, or get permission from the owner. e
event being reported.”                               National Digital Library Program goes to great
    To determine whether a specific use under        effort to identify possible copyright owners for
one of these categories is “fair,” courts are re-    items in American Memory, though it is often
quired to consider the following factors:            unable to ascertain possible rights holders
 the purpose and character of the use,              because of the age of the materials. When the
   including whether such use is of a                rights holder is known to the program, it will
   commercial nature or is for nonprofit             provide that information in the Restriction
   educational purposes;                             Statements accompanying the collections.
 the nature of the copyrighted work;
 the amount and substantiality of the
   portion used in relation to the copyrighted
   work as a whole (is it long or short in length,   This material was drawn from the Library of
   that is, are you copying the entire work, as      Congress’ Copyright Office web pages, http:
   you might with an image, or just part as you      //www.copyright.gov/fls/fl102.html and http://
   might with a long novel); and                     memory.loc.gov/ammem/ndlpedu/start/cpyrt/.
 the effect of the use upon the potential
   market for or value of the copyrighted work.


                                                                                                59
            e IMPORTANCE
                of the
Public
                                 Domain
                                                   By Anita R. Eisenstadt




         he patent and copyright clause of
          the U.S. Constitution (Article I,
Section 8, Clause 8) that provides Congress
with the power “[t]o promote the Progress of
                                                   information contractually designated as
                                                   unprotected), or been abandoned.
                                                       Public domain is different from “open
                                                   access,” which typically refers to works that
Science and useful Arts,” speaks of “securing      are copyright-protected, but whose authors
for limited times to authors and inventors,        or publishers have chosen to make the work
the exclusive right to their respective writings   freely available to the public. Even if works
and discoveries.” The insertion of the phrase      are in the public domain, users should still
“ for limited times” shows that the Founding       acknowledge the source of the work, since
Fathers of the United States realized that it      failure to do so could constitute plagiarism.
is critical to balance the intellectual prop-          e U.S. government, producer of the
erty interests of authors and inventors with       single largest public body of scientific and
society’s need for the exchange of ideas. They     educational information, is one of the world’s
achieved this balance by limiting the term of      greatest contributors to the public domain. Its
the exclusive right and allowing the growth        Office of Management and Budget’s Circular
of an unrestricted “public domain.” Just as        A-130, ”Management of Federal Information
a functioning intellectual property system         Resources,” recognizes that government in-
can generate significant cultural and eco-         formation is a valuable national resource and
nomic benefits, a robust public domain also        that the free flow of information between the
contributes to a democratic society, a strong      government and the public is essential to a
economy, and the advancement of science.           democratic society. U.S. government practic-
    e term “public domain” refers to mate-        es also have promoted broad dissemination
rials and information that are not protected       of information generated by federal govern-
by intellectual property rights (IPR). Infor-      ment funding. Grantees who receive federal
mation in the public domain is available for       government funding are strongly encouraged
the public to use without prior authorization      to share the results of their research.
or restrictions on reuse. In the United States,
this includes factual information1 and works
created by federal government employees in         1
                                                    Note that the European Database Directive
the scope of their employment. e public           adopted in 1996 created a new type of intellectual
domain also includes works subject to copy-        property protection (sui generis) for databases,
right protection, but for which such protec-       restricting certain uses of factual information
tion has expired, been renounced (such as          compiled in databases.

60
A customer at the U.S. Government
Printing Office bookstore. The agency
is the federal government’s primary
resource for gathering, cataloging,
producing, providing, and preserving
published information, most of it in the
public domain.


                 A robust public domain also
          contributes to a democratic society:
               Much of the U.S. government’s
                published information is now
                      available electronically.


   International and intergovernmental or-          UNESCO Policy Guidelines Related
ganizations — UNESCO, the United Nations’            to Governmental Public Domain
World Summit on the Information Society,             Information, http://portal.unesco.org/ci/
the International Council for Science (ICSU),        ev.php?URL_ID=15863&URL_DO=DO_
and the Committee on Data for Science and            TOPIC&URL_SECT.
Technology (CODATA) — have focused on               WSIS Declaration of Principles and
the importance of the public domain for both         Plan of Action, http://www.itu.int/wsis;
developed and developing countries.                  www.CODATA.org.
   Certainly, there is tension in finding the       Duke Law School Conference on the
optimal balance between the public domain            Public Domain, http://www.law.duke.edu/
and intellectual property protection. It is          pd/. 
essential to promote the broad dissemina-
tion of knowledge and information while
ensuring that authors and inventors receive
appropriate protection for their work. e          Anita R. Eisenstadt is a foreign affairs officer for
approaches to resolving this tension are al-       Communications and Information Policy in the
most as diverse as the governments seeking         State Department’s Bureau of Economic and Business
to resolve it. However, one thing is clear: Free   Affairs, Office of International Communications
                                                   and Information Policy, on detail from the National
and forward-moving societies need both.
                                                   Science Foundation where she serves as assistant
   For additional reading on this topic, see:      general counsel. She is an expert on federal scientific
 e Role of Scientific and Technical Data         data policy.
   and Information in the Public Domain:
   Proceedings of a Symposium, National
   Research Council, http://books.nap.edu/
   catalog/10785.html.


                                                                                                        61
      Roundtable:

   a
     Enforcement,
Priorityfor All Countries

               any countries have adopted
                sophisticated laws to protect
 intellectual property in order to join interna-
 tional or regional accords and organizations.
                                                   Customs and Border Protection Service, part
                                                   of the Department of Homeland Security.
                                                      According to these experts, effective
                                                   enforcement of intellectual property rights
 By doing this, a country has taken an impor-      should be a priority for all countries seek-
 tant first step. However, the creation of laws    ing economic growth and full participation
 alone will not enable a country to effectively    in the world economy. e following is their
 enforce the rights of property holders. That      discussion.
 requires the development of appropriate en-
 forcement mechanisms.                             MODERATOR: First, where does enforce-
     Why does effective enforcement often lag      ment fit into an overall intellectual property
 behind the institution of law? What are the       strategy?
 barriers to enforcement? Will the benefits
 of enforcement be shared by all countries or      SMITH: As the world economy develops and
 just a few?                                       as economies are more reliant on high-tech-
     e State Department’s Bureau of Inter-        nology sectors, the importance of protecting
 national Information Programs (IIP) invited       intellectual property rights is rising.
 a panel of U.S. government experts to dis-            When the Patent and Trademark Office
 cuss these and other questions regarding          began conducting overseas training in 1997,
 the enforcement of intellectual property          the emphasis was on advising countries about
 rights (IPR). Led by moderator Berta Gomez,       drafting legislation that would conform to
 then a senior writer-editor in IIP’s Office of    obligations under the World Trade Organiza-
 Economic Security, the roundtable discus-         tion’s Agreement on Trade-Related Aspects
 sion included: Michael Smith, an attorney         of Intellectual Property Rights (TRIPS). Over
 adviser in the Office of Enforcement at the       time, the focus has shifted from these laws to
 U.S. Patent and Trademark Office (USPTO);         what countries actually are doing on a daily
 Jason Gull, a trial attorney with the U.S. De-    basis. We’ve found that many countries have
 partment of Justice’s Computer Crimes and         laws on the books that are TRIPS-compliant,
 Intellectual Property Section; and Joseph         but that much remains to be done to actually
 Howard, a senior attorney adviser in the In-      enforce those rights at the borders and in the
 tellectual Property Rights Branch of the U.S.     civil and criminal court systems.

 62
                                                                         A U.S. Federal Bureau of Investigation
                                                                         (FBI) “wanted” poster for an individual
                                                                         charged with copyright
                                                                         infringement.




Los Angeles, California, health department officials during
a news conference announcing the confiscation of illegal
pharmaceuticals. In the United States, a variety of federal laws
and agencies protect consumers from counterfeit products
that endanger health and safety.


   As copyrights, trademarks, and patents                 in shipping, technology, telecommuni-
become more important each year to the U.S.               cations, and the Internet, has created mar-
economy, our interest in protecting those                 kets that are increasingly global in scope.
rights abroad increases. And U.S. and other                   Just as tangible things can move easily
rights holders around the world are reluctant             and cheaply across borders, IP problems can
to invest in countries where, on a day-to-day             likewise be exported. For example, counter-
basis, copyrights, patents, trademarks, and               feit products manufactured in East Asia have
trade secrets are not adequately protected.               been a problem for a long time. But coun-
                                                          terfeit production like this becomes an even
GULL: From our perspective at the Depart-                 greater problem as the products become less
ment of Justice, the harmonizing of intellec-             expensive and easier to ship to other parts of
tual property laws around the world through               the world.
international agreements, going back even to                  e Internet allows for instantaneous
the Berne Convention, is important to defin-              distribution of information around the world
ing the rights of authors, inventors, and com-            at essentially no cost. So, in addition to all
panies in products they develop. We would                 the positive activity this technology allows,
like to see countries come to a general agree-            people are using the Internet to engage in
ment about what those rights should be.                   massive infringement of intellectual proper-
   But without effective enforcement, these               ty. is problem is growing as the digital sec-
laws are essentially empty promises. Effec-               tor of the economy is growing in the United
tive enforcement of these rights is required              States and in other countries.
so that authors and inventors can make ratio-
nal decisions about whether they’re going to              MODERATOR: You said improvements in
publish, release, or invent something.                    shipping make it easier for goods to cross
   In the last few years, enforcement has be-             borders. Is this one of the barriers to effective
come a much more significant issue. A com-                enforcement?
bination of factors, including improvements

                                                                                                           63
HOWARD: Perhaps the most critical ob-                Conversely, countries that neglect IPR en-
stacle to effective enforcement is the absence       forcement will tend to see their reputations,
of a full understanding of the value of intel-       and the investment climate, suffer.
lectual property rights to every nation that
engages in international trade.                      SMITH: Another key barrier to effective en-
    I’ve spoken in several countries overseas,       forcement is a lack of political will. Without
and in each I was asked, “Why should we do           political will starting at the very top of the
this? Why are we protecting the wealthy na-          government, it’s hard for enforcement au-
tions or manufacturers who own these intel-          thorities to look at these issues as important
lectual property rights?”                            and to commit resources to solving them.
    My response is that, first, if your country         When the USPTO conducts technical
is governed by the rule of law and has signed        assistance, we try to explain why enforce-
certain international agreements, it is obli-        ment is important to the local economy.
gated to adhere to its agreements. Secondly,         For example, local music is not only an
as your country develops its own sectors in          indigenous cultural heritage issue; it is a
which manufacturers, inventors, or artisans          copyright issue of economic concern to lo-
are creating intellectual property, it’s impor-      cal industries. We have found, particularly in
tant that you give them the full value of their      Asia, that there’s a link between the ability of
rights.                                              the country to provide effective enforcement
    Many times, people don’t appreciate that         mechanisms and the growth of music made
protecting intellectual property is important        by local artists.
to employment, which leads to growth and
a better quality of life. If you don’t respect       MODERATOR: But how does a government
intellectual property rights, no one wants to        go about providing effective enforcement
invest in your country. You won’t attract the        once it has decided to do so?
foreign capital that you need to improve the
lifestyle of your nation’s inhabitants.              GULL: Although political will is certainly
    Once people appreciate the value of the          important, that is not to say that protecting
rule of law, then it’s clearly not just benefiting   intellectual property rights is just a matter of
the wealthy countries.                               convincing the upper levels of government
                                                     that this is an important issue, and that their
GULL: I, too, am asked by foreign audiences,         decrees will trickle down to street-level en-
“Why protect intellectual property when              forcement.
it’s all American or rich countries’ brands?             e government also has to work on pub-
Why should I do the bidding of these U.S.            lic awareness to make sure that the public
companies?” One answer is that, in much the          agrees that intellectual property is worth
same way that trademark owners must work             protecting. Michael’s point about indigenous
to protect their brands, countries themselves        music is an excellent one.
must work to enforce IPR to protect the                  Of course, many pirated products are
country’s own reputation.                            copies of goods produced by U.S. companies,
    A trademark is simply a brand. It con-           such as Microsoft’s software or American pop
veys information about the reputation of             stars’ CDs, which are then sold overseas. But
the manufacturer and the reputation of the           if a country allows piracy to go unchecked,
product. If a particular trademark holder            its own industries – music, or fi lm, or soft-
starts turning out poor-quality products,            ware — will likely find their own products
people will stop buying them. e reputation          being pirated along American ones. Since
goes down.                                           the domestic creators of music, or movies, or
    To encourage investment, you need an             software, tend to rely more heavily on their
effective legal regime that protects people’s        own domestic markets for their livelihoods,
rights, including intellectual property rights.      a high level of piracy at home may hurt these
A country can help build its own brand im-           domestic producers most of all.
age by ensuring effective IP enforcement.

64
                                                               A soil compressor destroys counterfeit CDs and tapes
                                                               in Brasilia on Brazil’s National Counterfeit Fighting Day.
                                                               Governments should make sure that their publics agree
                                                               that IP is worth protecting.




Foreign media in China were invited to this IPR case
being heard in Beijing’s highest court. In many countries,
low damage awards are not a deterrent to pirates and
counterfeiters.

                                                               A police officer throws a box of pirated CDs into the
                                                               fire near Jakarta. Indonesia has imposed harsher laws
                                                               providing fines and jail terms for copyright violators.




Sheriff Deputies in Whittier, California, check counterfeit    In Cressier, Switzerland, officials crush counterfeit
Microsoft registration hologram stickers seized following an   Swiss watches. To support one of its most famous
undercover investigation. A criminal investigation can be      industries, Switzerland’s border control confiscates
initiated through the complaint of a rights holder, but this   thousands of counterfeit watches every year.
should not be a requirement before police can act.

                                                                                                          65
   Piracy can make it even tougher for             intellectual property rights that are recorded
domestic industries to compete with large          with us, information about exclusion orders
foreign companies. In countries where every        issued by the USITC is entered into the IPR
kind of CD, DVD, or software is available          module for dissemination to field officers.
for a couple of dollars per disc, a local fi lm    e public version of the IPR module1 can
studio or software publisher will find it very     be easily accessed. e web address is http:
difficult to compete, based on price, with the     //www.cbp.gov. Click on the “Quick link” at
latest Silicon Valley software or Hollywood        that page for “Intellectual Property Rights,”
blockbuster.                                       and at the next page click on “Intellectual
   Ironically, countries that want to avoid        Property Rights Search (IPRS).” e web site
being overrun by American goods might              also contains a wealth of information about
consider strengthening their protection of         our intellectual property rights border en-
intellectual property. at would serve local       forcement program.
industry in the long run by allowing that in-
dustry to grow and encouraging investment.         MODERATOR: And this is a case in which
   If the public is on board with protecting       new technology actually helps enforcement?
intellectual property, then police officials
will be willing to shut down street vendors        HOWARD: Yes. But as my colleagues have
selling pirated and counterfeit products.          pointed out, people have to want to do it.
Prosecutors will be willing to pursue those        at’s crucial.
cases because they won’t face the wrath of
an unhappy public. Judges will be more will-       MODERATOR: Do you have examples of
ing to mete out deterrent penalties, whether       countries in which you’ve seen progress and
prison time or monetary damages.                   growing interest in protecting IPR?

HOWARD: It is particularly important for a         HOWARD: I was in Egypt when they were
country to have a mechanism whereby a for-         talking about IP enforcement issues, and the
eign rights holder can bring a problem to the      people I spoke with said that they wanted a
attention of authorities and have a realistic      customs system like that in the United States.
chance of receiving enforcement activity on        It seems people from all over the world look
his or her behalf. is overcomes the inertia       to our government for guidance on how to
that otherwise is present. It encourages the       do certain things. ey might not like what
authorities to enforce rights.                     we say in some instances, but they’re open to
                                                   considering what we have to say.
MODERATOR: Can you describe the train-
ing or speaking that you do overseas?
                                                   1
                                                     The Intellectual Property Rights Module (IPR
                                                   module) is the U.S. Customs Services’s automated
                                                   system containing information about recorded
HOWARD: I’ve gone to other countries,
                                                   intellectual property rights. The IPR module
looked at legislation, and talked to people        currently contains over 25,000 recordations.
about what we do. I explain that it’s reason-      It provides a systematic listing and detailed
able, if you don’t have the resources to have      information, including images, to assist Customs
a database of all the intellectual property        officers in providing adequate protection on a
rights that might be infringed, to at least have   timely basis. The IPR module is an extension of the
a mechanism so that others can bring infor-        Customs recordation process. Recordation refers
mation to your attention. Many countries           to bringing a valid, federally registered intellectual
thought that that was useful.                      property right, a trademark or copyright, to the IPR
   e U.S. Customs Service also enforces           Branch, Office of Regulations and Rulings, Bureau
exclusion orders (legally binding commands         of Customs and Border Protection and recording
                                                   that right with the IPR Branch. Information about
barring entry into the United States of goods
                                                   that intellectual property right is entered into the
that allegedly violate U.S. intellectual proper-   IPR module and made available to field officers.
ty rights) issuing from the U.S. International     A public version of the IPR module is available to
Trade Commission (USITC). Just as with             those outside of Customs.

66
SMITH: I think most countries would agree
that the U.S. system for protecting intellec-
tual property rights at the border is one of
the most efficient systems in the world. But
a lot of what is done in the United States is
not practical for most countries. Certainly
developing and least developed countries
don’t have nearly the resources that the U.S.
government has. Also, most countries don’t
have as many border crossing points as the
United States.
   e customs services in these countries       A growing problem for governments and rights holders:
have to decide how best to utilize the re-      Massive infringement of IP through the Internet is growing.
sources that they have. In technical assis-     To check cybercrime, India is requiring identity proof from
                                                cybercafé customers.
tance programs overseas, the Patent Office
uses that as a starting point to encourage
compliance with a country’s obligations
under the TRIPS agreement. TRIPS provides
minimum standards, such as establishing a
system so that rights holders can go and re-
cord and seek enforcement of their rights.
   Having said that, a country can be fully
in compliance with the minimum obliga-
tions of the TRIPS agreement and still have
a huge problem at its borders. For instance,
the TRIPS agreement requires countries to
provide for protection against imports of
pirated copies of goods and goods bearing                                                     A steamroller
                                                                                              crushes a pile of
counterfeit trademarks. It does not require                                                   counterfeit Winnie-
countries to provide protection at the border                                                 the-Pooh dolls
with regard to exportations of such goods or                                                  during Thailand’s
                                                                                              annual destruction
movements of such goods within the country                                                    of seized
that might be exported later.                                                                 counterfeit items.
   So a primary concern of the U.S. gov-
ernment is the exportation of pirated and
counterfeit goods that are produced in one      under the TRIPS agreement and have had
country to other countries, for instance,       legislation in place for a while, they become
within Europe or Asia. In that case, we would   more receptive.
advocate for “TRIPS-plus” provisions. We do        Of particular importance to the U.S.
this in bilateral negotiations as part of the   government right now is regulating optical
free trade agreements negotiation process. In   disc (i.e., CDs, VCDs, DVDs, etc.) piracy in
training, we would emphasize why, although      countries where the production exceeds the
these are not TRIPS requirements, they are      amount of legitimate demand. Obviously,
often needed in order to have an effective      this overproduction of pirated material can’t
enforcement system.                             be supported by the local economy, so the
                                                product is being exported. In these instanc-
MODERATOR: Are countries receptive to           es, we would advocate export controls at the
this?                                           border and optical disc regulations.

SMITH: Definitely now more than 10 years        MODERATOR: How big a problem is cor-
ago. I think that, as countries have become     ruption as it relates to IPR?
more comfortable with their obligations

                                                                                                 67
GULL: Corruption is a significant problem                 On the government side, one barrier to
in a number of countries around the world             border enforcement is that it’s labor-inten-
that are trying to enforce intellectual prop-         sive. You need customs officials at the border
erty rights.                                          who are good consumers, familiar with the
    Part of this is related to just how much          trademarks that have been recorded, and
money is at stake. When there’s a lot of              who have an interest in enforcing the rights
money involved in an illicit activity, there is       of trademark holders. Without knowledge-
bound to be some corruption.                          able customs inspectors, you’re going to have
    Another aspect of intellectual property           a problem with effective enforcement at the
piracy and counterfeiting is organized crime.         border.
Criminal gangs, both within the United                    On the criminal side, another problem
States and in many other parts of the world,          is that countries initially might prosecute
are involved in the production and distribu-          numerous cases of vendors selling pirated
tion of pirated and counterfeit goods at all          or counterfeit goods on the street. Although
different levels. Of course, corruption of            this might get the infringers off the street,
public officials is by no means unique to in-         it’s not going to the source of the activ-
tellectual property issues. But in those places       ity. In many countries, the infringement of
where corruption is widespread, it’s going to         intellectual property rights has its base in
affect intellectual property enforcement.             organized crime. erefore, a more efficient
                                                      use of a government’s time and money would
SMITH: You asked, “What are the barriers              be to use their organized crime statutes to
to effective enforcement?” I think it depends         prosecute these cases at the source of the
on whether you are talking about civil, crimi-        funding.
nal, or border enforcement.
   Criminal enforcement and border en-                GULL: Yes, it’s more effective to go after “big
forcement can be grouped together in that             fish” than small ones because you cut off the
they are actions taken by the government.             supply. Generally, the biggest effect of going
On the civil side, it’s a private litigant going in   after street vendors is that piracy gets pushed
and redressing harm in a civil courts system.         a little off the street. at is, instead of a table
   e problems on the civil side are similar          full of pirated optical discs, you’ll have one
in many countries around the world. e                guy with a sign saying CDs and DVDs, and
USPTO found that, although lots of coun-              he’ll burn you a copy or get you a counterfeit
tries have legislation and a civil procedure          copy from a van or an apartment down the
code that provides for a rights holder to go          street.
into court and get interim relief or a tem-               Michael touched on the critical impor-
porary restraining order, those laws are not          tance of having effective civil remedies. In
applied in practice.                                  the United States, the vast majority of en-
   We’ve also found that the damage awards            forcement is done by copyright holders or
that many courts give are so low that they            trademark owners who initiate actions. e
are not actually a deterrent to those who             United States has effective civil remedies:
engage in piracy or counterfeiting and do not         injunctions, seizures of counterfeit goods,
adequately compensate rights holders for the          and monetary damages. One has a realistic
harm they have suffered.                              chance of actually obtaining those types of
   Finally, we’ve found that, in some coun-           remedies here, and in many other countries
tries, the infringing goods and the machin-           with more established civil law mechanisms.
ery used to produce those goods are not                   In some places, there isn’t as mature a
actually destroyed. ey can enter back into           civil enforcement system. In those areas, for
the stream of commerce. at’s obviously not           now at least, criminal and related border-en-
in the best interest of the rights holders or         forcement mechanisms are the only realistic
the public.                                           chance of making a dent in intellectual prop-
                                                      erty infringement.


68
   In some countries, a criminal prosecution           MODERATOR: Do health authorities have
or investigation cannot be initiated unless            a role in telling consumers that counterfeit
there is a complaint from a rights holder.             products may be unsafe or dangerous?
is is a serious impediment because it’s
not practical for the rights holder to make            GULL: In the United States, a variety of
a complaint in every instance. It means that,          federal laws and agencies protect against the
in some countries, police aren’t empowered             kinds of counterfeit products that endanger
to seize offending goods that they recognize           health and safety. Selling a counterfeit drug
on the street or at a criminal enterprise. We          on the Internet, like the fake Viagra adver-
encourage countries to eliminate this kind of          tised by “spammers” through e-mail, would
requirement, whether it’s in their actual law          likely be a violation of Food and Drug Ad-
or merely a policy on the part of the police           ministration laws regarding drug safety, as
and prosecutors.                                       well as a federal trademark violation. It might
   Also, some countries erect or maintain              violate laws in the individual 50 U.S. states
artificial barriers that make it more dif-             as well.
ficult to show ownership of a trademark or                 When something is counterfeit, there’s no
copyright. A court may require that there be           way of tracing it to the true manufacturer.
testimony from the actual copyright owner,             For example, counterfeit liquor is prevalent
rather than simply allowing a certificate from         in a number of Eastern European countries.
a copyright office as “prima facie” (Ed. Note:         When genuine liquor violates health and
Latin for “on its face,” as it seems at first sight)   safety standards, the origin of the product
evidence of copyright ownership. is sort of           can be traced. e factory where it was made
excessive formality can impede an effective            can be inspected and forced to improve. But
enforcement regime. Often it’s little things           with counterfeit goods, that’s not possible be-
like this that persist even after the large steps      cause, by definition, the origin of the product
of signing on to TRIPS, for example, have              is unknown.
been accomplished.
                                                       SMITH: is ties in with public awareness.
MODERATOR: How important is partici-                   e government can play a role in educat-
pation on the part of the rights holder?               ing the population that intellectual property
                                                       protection is not only an economic issue, but
HOWARD: e U.S. Customs and Border                     also a health and safety issue. Counterfeit
Protection Program relies heavily on the               food products and counterfeit pharmaceuti-
rights holder who has recorded something               cals have resulted in deaths. Either they don’t
with us to bring information about potential           contain the components that they’re sup-
problems to us. Often the rights holder can            posed to or they contain components that
pinpoint the date when infringing goods are            are lethal to people, and people purchase
going to arrive, the port or ship they’re going        them unwittingly.
to be on, or the mode of entry into the United            Or consider airplane parts, where a pi-
States. at helps us to focus our efforts and          rated or counterfeit product is labeled as
not waste our limited resources.                       meeting laboratory standards of safety, but
   Intellectual property rights holders also           actually contains faulty components.
might help themselves by educating the                    Health and safety issues can bring the
consumer to understand that not all deci-              discussion to a more personal level than the
sions should be based merely on price alone.           economic aspects of intellectual property
A counterfeit product may be sold at a lower           protection. is is about people’s lives. 
price, but may not have the same features as
the actual product, or it may not be as safe or
last as long. Equally or perhaps more impor-
tant, you may not get the support that you
would get from a legitimate manufacturer if
the product is defective.

                                                                                                   69
                      New Tools for
Fighting Optical Disc
        Piracy
                                                   By Laura Lee with Bonnie J. K. Richardson




            igital technology has turned into
             reality the promise of innova-
 tive ways of distributing creative works on
 a global scale. With digital technology, a
                                                   vulnerable to piracy. Unlike traditional pira-
                                                   cy involving analog technologies, the quality
                                                   of a digital pirated disc is as high as the origi-
                                                   nal, and a production facility can churn out
 film enthusiast anywhere in the world can         a huge volume of illegal discs in a relatively
 view movies from India, Mexico, or Egypt,         short time. In 2003, the U.S. motion picture
 and music lovers can download the unique          industry, working with law enforcement
 sounds of Russian, Chinese, or Zairian music      agencies around the world, seized more than
 at the click of a button.                         52 million pirated optical discs.
     ese same technological advances, how-           In order to tackle this fast-growing cri-
 ever, have also given rise to serious forms of    sis effectively, it is essential to develop and
 piracy. Every industry that depends on copy-      implement innovative tools for controlling
 right protection, including the movie, music,     piracy at the source of production. One
 and software industries, is facing tremen-        useful way of doing so would be to adopt
 dous losses from optical disc piracy. Coun-       optical disc regulations along the lines of the
 tries put their economic future in jeopardy       “Effective Practices” adopted by government
 when they fail to adequately protect these        leaders at the APEC (Asia-Pacific Economic
 industries’ intellectual property rights (IPR)    Cooperation) conference in October 2003.
 from both optical disc and traditional forms         e “Effective Practices” are designed to
 of piracy. Piracy hinders the development of      identify and control all facilities that repli-
 these industries in many countries and thus       cate optical discs by requiring that authori-
 discourages potential investors, innovators,      ties strictly license optical disc producers and
 and the creation of valuable new jobs.            manufacturing equipment. A well-enforced
     Optical discs include formats such as digi-   licensing scheme will provide legal grounds
 tal versatile discs (DVD), DVD-Recordables        for the immediate closure of unlicensed
 (DVD-R), compact discs (CD), CD-ROM,              facilities. e regulations also require that
 compact discs with recording cores of dye         licensed optical disc producers retain pro-
 instead of metal (CD-R), video compact discs      duction records and add source identification
 (VCD), and laser discs (LD). Optical discs are    codes (SID) to each disc produced, measures
 inexpensive to manufacture and easy to dis-       that will help ensure that licensed facilities
 tribute, two features that make them highly       are producing only legal optical discs.

 70
                                                Fighting pirates: These DVD-Audio discs offer a higher sound quality
                                                than common music CDs, but also contain a digital watermark that
                                                prevents the owner from making perfect copies of the content.




                                                An inventor in Israel, Amos Loewidt, believes he has found a solution
                                                to the worldwide problem of CD piracy by placing a slender, plastic-
                                                covered electronic card with an electronic chip, a unique serial number,
Steamrollers crush confiscated pirated music    and two optical detectors onto a CD.
and movie CDs, VCDs, and DVDs in Manila, the
Philippines. In 2003, the U.S. motion picture
industry, working with law enforcement
agencies around the world, seized more than
52 million pirated optical discs.



                                                                                                      71
                                                              An official from Thailand’s Commerce Ministry
                                                              inspects a pirated DVD from a shelf showing pirated
                                                              movies during a raid at a shopping mall in Bangkok.




A foreign tourist browses the selection of pirated CDs in a
stall in Phnom Penh. Governments have to remain flexible
and develop new tools to deter pirates.




                                                              In Sofia, Bulgaria, workers prepare movie, music,
A peddler in Moscow, Russia, showing pirated and              and software discs for destruction. The “Effective
authentic copies of CDs, videos, and computer software to     Practices” discussed in this article endorse a
a prospective customer. The U.S. government is working        government’s authority to conduct surprise
with Russia to adopt vital optical disc regulations.          inspections of optical disc producers’ facilities.


             72
   e “Effective Practices” also make the             An effective means to sever this tie be-
cross-border traffic in manufacturing equip-       tween criminal syndicates and optical disc
ment and raw materials used to make optical        piracy is the use of laws designed to combat
discs, such as optical-grade polycarbonate,        organized crime. e welfare of the copy-
subject to reporting requirements that facili-     right industries depends upon the coordi-
tate the tracking of these materials. Further-     nated efforts of all countries to dedicate the
more, the “Practices” endorse a government’s       same kinds of legal tools to fighting piracy
authority to conduct surprise inspections          that they bring to other kinds of organized
and to seize and destroy machinery used to         crime. Among others, these tools may in-
produce pirated materials.                         clude money laundering statutes, surveil-
   We believe that every country whose opti-       lance techniques, and revamped organized
cal disc production facilities are producing       crime laws.
significant quantities of pirated products            Pirates aim to be always one step ahead of
should create and enforce this type of spe-        current regulatory regimes. In order to stem
cialized regulatory framework for control-         the tide of piracy in an effective manner, it is
ling the production of optical discs. Pirate       imperative that governments remain flexible
syndicates are constantly migrating optical        and develop new legal tools on a continuing
disc production from jurisdictions with anti-      basis. It is only with a truly international ap-
piracy regulatory regimes to countries still       proach — one that adopts and enforces tai-
lacking sufficient protection. To date, China,     lored optical disc regulations — that optical
Bulgaria, Malaysia, the Philippines, and Tai-      disc piracy rates can be significantly dimin-
wan employ optical disc regulatory regimes,        ished on a local and global scale. 
and Singapore is in the process of complet-
ing a similar system. e U.S. government is
also working with the governments of Russia,
Pakistan, and ailand to adopt these vital         Bonnie J. K. Richardson is vice president for Trade
optical disc regulations.                          and Federal Affairs at the Motion Picture Association
   An increasingly troublesome facet of opti-      of America (MPAA). Laura Lee is a student at the
cal disc piracy is its association with crimi-     University of Virginia School of Law and MPAA intern.
                                                   The MPAA is a nonprofit trade association representing
nal organizations. Organized crime has been
                                                   seven of the largest producers and distributors of
quick to realize that piracy, with its potential   television programs, feature films, and home video
for high profits and minimal penalties in          entertainment material.
many countries, is one of the most lucrative
and low-risk criminal businesses. Law-en-
forcement authorities, such as Interpol, have
identified counterfeiting of optical discs as a
valuable source of funding to criminal syndi-
cates and terrorist groups.




                                                                                                      73
                                                        A
                              Trade
                        Association
                                                                                     at Work
SECTION III: ISSUES BY INDUSTRY




                                                                                     By Patricia L. Judd




                                            ooks are everywhere around us.
                                             Popular titles, such as the Harry
                                  Potter® series or Nobel Prize winner V.S.
                                  Naipaul’s A House for Mr. Biswas, can be
                                                                                         ese activities — often seen by many
                                                                                     book consumers as harmless — hurt legiti-
                                                                                     mate creators, foreign and domestic produc-
                                                                                     ers and — ultimately — every national econ-
                                  found in bookstores all over the world. Books      omy. Every country has students who may
                                  serve as tools for entertainment and educa-        be primarily users of information now, but
                                  tion, as well as professional, personal, and       who will be creators in the near future. Every
                                  societal development.                              country has writers and scholars, and most
                                      Unfortunately, legitimate authors, pub-        also have publishing or printing industries
                                  lishers, printers, distributors, and retailers     that are suffering from the same type of pira-
                                  are often denied the opportunity to satisfy        cy encountered by U.S. publishers. Creators
                                  the world’s appetite for books because ram-        will more likely stay in their home countries
                                  pant print piracy, commercial photocopying,        if they are able to produce an income from
                                  illegal translations, and digital piracy work to   their talents there. Protecting their ability to
                                  destroy the market for legitimate materials.       do that serves them and their countries as
                                  Symptoms of this phenomenon abound:                well as their publishers.
                                   In and around universities and schools,              e Association of American Publishers
                                     copyshops that make it easy to illegally        (AAP), the principal trade association of
                                     photocopy works often have lines out the        the U.S. book publishing industry, estimates
                                     door.                                           that its members lose over $600 million
                                   English-learning programs and other              dollars a year because of global piracy. is
                                     language courses advertise use of               number, unfortunately, is a gross underesti-
                                     high-quality materials and display              mate, based on calculations of losses in just
                                     original products, but then use illegally       a few countries and territories. Nevertheless,
                                     photocopied versions in their lessons.          this figure alone underscores the need for
                                   Medical book pirates conduct door-to-            improved enforcement in many places, and
                                     door sales, without fear of reprisal.           adherence to international copyright stan-
                                   Pirates marketed fifth, sixth, seventh, and      dards by all countries, since copyright pirates
                                     eighth books, supposedly in J.K. Rowling’s      prey on authors, businesses, and consumers
                                     Harry Potter® series, at a time when the        around the globe. Proof of this is that AAP
                                     author had written only four!                   raids abroad almost always uncover illegal
                                                                                     copies of local materials.

                                  74
Winners of the U.S. National Book Awards Kevin Boyle, Lily Tuck, and Jean Valentine read from and sign their
award-winning books at a New York City bookstore.




With today’s technologies, pirates find it easy to copy whole books, robbing authors of their intellectual
property and the right to make a living from their work.




                                                                                                             75
A new device that works as a printer,
scanner, and copier. The Association of
American Publishers works within the
United States and with other countries
to spread the message about illegal
commercial photocopying.


                The millions of Harry Potter fans include
                 this nine-year-old in Denmark. Pirates,
            however, marketed fifth, sixth, seventh, and
            eighth books, supposedly in the series, even
             though at the time J.K. Rowling had written
                                                only four.




   Because of IPR protection, authors in the United States and in the rest of the world can enjoy an income from the
   sale of their books and of subsidiary rights for translations, movies, and TV serials.


           76
   AAP supports the international fight                In all of this, AAP works to educate the
against copyright pirates by partnering with       public about the ways in which copyright
local counsel, investigation firms, member         protection promotes creativity, which in
company offices, and government officials to       turn is essential to the development of mar-
ensure that both the public and private sec-       kets, not only for U.S. publishers, but for
tors are doing everything possible to stamp        each and every country’s creators and related
out these crimes. AAP projects include legal       industries.
action, data collection, training, and media           AAP members and staff are interested in
efforts to educate governments and consum-         work that benefits creators and publishers in
ers about the harms inflicted by piracy.           all countries and territories, and would wel-
   AAP and its members also work, where            come your input. 
appropriate, with local publishers to identify
projects for possible collaboration. Currently,    For more information, please contact:
AAP has active programs in Hong Kong,
Malaysia, the People’s Republic of China, the      Patricia L. Judd
Philippines, Singapore, South Korea, Taiwan,       Director, International Copyright
and ailand. e association also works             Enforcement
closely with its international counterparts in     50 F Street, N.W., Suite 400
Pakistan, India, and several other countries.      Washington, D.C. 20001
   On the policy side, AAP cooperates              (202) 220-4541
with U.S. and foreign government agen-             pjudd@publishers.org
cies to promote passage and enforcement            www.publishers.org
of stringent intellectual property laws. e
association also monitors developments in
legal or practical market access. AAP con-
tributes significantly to the annual “Special      Patricia L. Judd is the director of international
301 Report on Global Copyright Protection          copyright enforcement for the Association of
and Enforcement,” submitted to the Office of       American Publishers.
the U.S. Trade Representative (USTR) by the
International Intellectual Property Alliance®
(IIPA) every February. IIPA, of which AAP
is a founding member, uses this report to
update the status of copyright protection in
50 to 60 countries and territories worldwide.
Finally, AAP regularly discusses intellec-
tual property rights (IPR) issues at book fairs,
seminars, and conferences in the United
States and overseas.




                                                                                                       77
   Intellectual
Property Rights
                                       and the
      Pharmaceutical Industry
                                                  By Judith Kaufmann




              any claim that more people do
               not have access to life-saving
drugs because of high prices and that pat-
ent rights both increase prices and stand in
                                                  services to people in more than 40 least de-
                                                  veloped countries.
                                                     Drug companies also are helping poorer
                                                  countries through a variety of innovative
the way of getting treatment to those who         public-private partnerships. ese partner-
need it.                                          ships include the African Comprehensive
   Both of these claims are false.                HIV/AIDS Partnership in Botswana, in
   Drugs that cure AIDS and many other dis-       which the government of Botswana, the Bill
eases are available precisely because of patent   & Melinda Gates Foundation, and the Merck
protection. Patent protections encourage re-      Co. support prevention programs, health-
search and development by offering the pos-       care access, and treatment of HIV/AIDS,
sibility that a pharmaceutical company’s in-      with Merck donating two antiretroviral drugs
vestment will be repaid, a powerful incentive     for treatments. e Onchocerciasis Control
to companies to invest millions and millions      Program, in turn, has greatly reduced trans-
of dollars into risky research and develop-       mission of “river blindness” throughout West
ment of these medications. Without patent         Africa by combining a spraying program
protection, other manufacturers could copy        and the donation of the drug Mectizan by
new drugs immediately. Since their costs are      Merck & Co.
minimal, they can offer their versions at a          ese are but some examples of the ways
reduced price, seriously hurting the ability      in which the research-based drug industry
of the company that developed the drug to         has regularly lowered its prices to the poorest
recoup its costs.                                 nations of the world and has increased drug
   In addition, those years in which a compa-     companies’ partnership with governments
ny’s patented products are protected can help     and with nongovernmental organizations to
generate the funding that makes research          ensure that drugs reach those in need.
into the next generation of drugs possible.          Generic medicines and copycat drugs are
   Drug companies are not only doing the          not always the answer for those seeking an
research that has helped so many, they are        alternative to a patent-protected drug. Ge-
ensuring that drugs reach those most in           nerics, independently developed drugs that
need through donations. In 2003 alone,            contain the same active substance as the
the U.S. pharmaceutical industry donated          original brand-name drug, are marketed in
more than $1.4 billion in medicines and           accordance with patent law and identified

78
                                                           Chinese Vice Health Minister Wang Longde (right) shakes
                                                           hands with the executive vice president of Merck & Co. Inc.,
                                                           Judy Lewent, after announcing a comprehensive HIV/AIDS
                                                           public-private partnership — with $30 million from the
                                                           Merck Foundation — on May 11, 2005.




A worker on the assembly line of Laboratorio Cristalia,
a maker of anti-retroviral generic drugs in Sao Paulo,
Brazil. Makers of generic drugs normally have not
invested the millions that research companies spend to
find new drugs.




                                                          Employees of Aspen Pharmaceutical Research
                                                          Laboratories, producers of generic AIDS drugs, in Port
                                                          Elizabeth, South Africa. GlaxoSmithKline has licensed
Two bottles of a medicine for liver patients,             three more South African companies, in addition to
Epogen, one real (left) and one counterfeit.              Aspen, to manufacture generic versions of its AIDS
                                                          medicines.

                                                                                                        79
            either by their own brand name or by their       treatments that may be less toxic and more
            internationally approved nonproprietary sci-     effective. Rather, they reduce incentives to
            entific name. Copycat drugs usually simply       research and thus discourage new products.
            copy the original drug manufacturer in the       And make no mistake: e manufacturers of
            countries with weak intellectual property        generic or copycat drugs are not in business
            protection.                                      to be generous; they, too, are reaping profits.
               Patented drugs often have passed much         eir profits, however, are not being used to
            more rigorous licensing requirements than        further scientific knowledge and find new
            so-called generics. Why “so-called”? Because     cures.
            not all drugs that claim to be so are identi-       Patents are not the problem that people
            cal and not all are subject to the stringent     assume them to be, either. A recent study
            inspection process that guarantees that they     published in Health Affairs found that “in
            contain the same amount of active ingredi-       65 low- and middle-income countries, where
            ents and work in the same way. Manufac-          four billion people live, patenting is rare for
            turers of some of these drugs have not had       319 products on the World Health Organi-
            to invest in the extensive testing required      zation’s Model List of Essential Medicines.
            of the research-based industry even before       Only 17 essential medicines are patentable,
            their drug can be marketed. Of course, there     although usually not actually patented.” If
            are many reliable manufacturers of generic       this large amount of life-saving drugs is ei-
            drugs. e United States, for instance, has a     ther off-patent (meaning that the company
            thriving generic drug industry, fully regulat-   that originally invented them no longer has
            ed and inspected by the U.S. Food and Drug       an exclusive claim because the patent has ex-
            Administration.                                  pired) or not patented, then patents cannot
               Building on the enormous investment           be the problem in getting drugs to people.
            already made by the research-based phar-            Price is not always the issue, either. When
            maceutical industry, copycat drugs can lower     people cite prices as a problem, they often
            drug prices, but they do nothing to guarantee    are comparing apples and oranges. Prices in-
            that new drugs will be available when they are   clude various factors: training of health care
            needed. Copycat drugs do nothing to ensure       personnel in the use of the drug, explanatory
            that scientific innovation translates into new   materials to make it safer for the consumer,




A technician in a pharmaceutical plant in
Ahmadabad, India. Patenting is rare for 319
products on the World Health Organization’s
Model List of Essential Medicines.


             A woman inquires about a drug at a
               street-side shop in Lagos. Surveys
              indicate that more than 60 percent
               of medicines on sale in Nigeria are
            counterfeit, substandard, or expired.

            80
even shipping and handling can be included         Malaria Venture (MMV — see p. 84) and the
or not. If one drug seems cheaper but ship-        International AIDS Vaccine Initiative (IAVI)
ping costs are not included, the effective cost    are two good examples of such partnerships.
may be identical to that of a patented drug.       MMV, for instance, has 21 drug development
Certainly, a government-sponsored drug             projects to ensure that the next generation of
company can provide lower prices to the citi-      treatment is available when drug resistance
zens of that country, since the government is      overtakes current malaria treatment options.
paying a large percentage of the actual cost.          As an article in the Washington Post re-
   ere are issues that need to be addressed,      cently suggested, “ese entities are in effect
including how to encourage even more in-           nonprofit virtual drug companies configured
novation, especially for drugs with limited        to discover and develop drugs and vaccines
markets or which treat diseases mostly prev-       for neglected diseases.”
alent in low- and middle-income countries.             Cheap drugs are no bargain, if they do
Developed countries can offer tax incentives       not cure the disease and if they contribute to
to encourage innovation in such areas, much        drug resistance that may make the drug use-
as the Orphan Drug Bill in the United States       less for everyone. Violating or bypassing pat-
does. (is U.S. law, administered by the           ent protections is a short-term solution that
Food and Drug Administration, deals with           threatens the long-term health of the world’s
medications used to treat diseases and con-        citizens by removing the incentives and dis-
ditions that rarely occur. Since there is little   couraging the innovation we need. 
financial incentive for the pharmaceutical in-
dustry to develop such medications, “orphan
drug status” gives a manufacturer specific
financial incentives to develop and provide        Judith Kaufmann is a retired foreign service officer,
such medications.) Government research             who served as the director of the U.S. State
dollars can be used to do basic research, as       Department’s Office of International Health Affairs.
the National Institutes of Health does in the
United States.
   Public-private partnerships are showing
the way in innovation: e Medicines for




                                                                                                    A University of
                                                                                                    Chicago field station
                                                                                                    foreman examines
                                                                                                    a Rauvolfia
                                                                                                    serpentina plant.
                                                                                                    The university’s
                                                                                                    field station in
                                                                                                    Downers Grove,
                                                                                                    Illinois, is part of a
                                                                                                    program to search
                                                                                                    for new plant-based
                                                                                                    medicines.


                                                                                                           81
      e Cost of
  Developing a
New Drug
                                                  By Neal Masia




             any of us know a family mem-
              ber or friend who has benefited
from a new medicine: Advances in treating
cancer, HIV/AIDS, cardiovascular disease,
                                                  through 5,000 to 10,000 new chemical inven-
                                                  tions that look promising, in order to identify
                                                  a pool of 250 compounds that then enter into
                                                  preclinical laboratory and animal testing. Of
and a broad host of other afflictions have been   those 250 unique compounds, fewer than 10,
nearly continuous in recent decades, thanks       on average, will show enough potential to
to — in many instances — new drug discov-         qualify for Phase I human testing to establish
eries. Economists estimate that almost half       basic safety.
of the increase in life expectancy achieved           Phase 1 trials usually include a very small
over the past 15 years in the industrialized      group of healthy volunteers who are tested
world can be attributed to new drugs. In the      to determine whether the candidate drug is
United States alone, the economic gains from      both safe and effective. A compound or drug
medical innovation are estimated at more          candidate that makes it through Phase I then
than $500 billion per year.                       enters small-scale Phase II trials in patients
    Finding new cures is an extremely ex-         with a specific condition to test whether the
pensive and risky proposition, however.           compound has the intended effect on the
Estimates about the cost of developing a          disease. If it shows promise, it graduates to
new drug vary widely, from a low of $800          Phase III trials, which are wide-scale tests
million to nearly $2 billion per drug. Even       involving thousands of patients in carefully
the high end of those estimates may soon          controlled clinical testing. Some drug candi-
be considered a bargain. Recently, the Pfizer     dates undergo several different types of Phase
pharmaceutical company announced that             III trials in order to test for different kinds of
it is investing $800 million just for a set of    effects. On average, for every five compounds
Phase III trials for a single drug.               that make it into human trials (of the original
    Where does all the money go?                  5,000 to 10,000 studied), U.S. government
    In the United States and most other coun-     authorities will grant the pharmaceutical
tries with pharmaceutical industries, private     company approval to market just one.
industry undertakes or funds virtually all            Overall, the discovery and development of
discovery and development of new medi-            a new medicine takes about 12 to 15 years.
cines, often building on basic medical hy-        Patents are granted along the way, and it
potheses developed through university and         usually takes at least a few years between the
publicly funded research. Industry scientists     granting of patents and marketing approval.
searching for a new drug typically must sort      is means that, despite the standard 20-year

82
A laboratory at the U.S. biotech company
Avigen, where they are investigating new
treatments for hemophilia B.

                         Two researchers at the Oklahoma
                            Medical Research Foundation,
                     testing an Alzheimer’s drug for a new
                                 pharmaceutical company.

patent life, the average effective patent life for
a new drug — the amount of time where                  sarily notice the absence of new medicines
the product is sold under patent protection            for a decade or more, given the decade-long
— is roughly 10 to12 years. In addition to the         drug-development-cycle time. Smaller firms
direct costs of development, firms must pay            and biotechnology companies would cer-
returns on the capital they invest on behalf           tainly notice, however, since they would have
of shareholders over the course of a decade            more difficulty raising investment capital if
or more, a cost that increases as development          expected returns were lower. Capital-starved
times increase.                                        companies would soon disappear, along with
   At current levels of reimbursement,                 the promise they hold for new treatments.
economists estimate that only about 30 per-                Continued investor confidence has en-
cent of new medicines actually earn enough             abled large-scale research and development
revenue during their patented product life-            to continue in the pharmaceutical industry,
cycle to cover the average upfront cost of             in the United States and in other countries.
development. If a firm incurred the average            Pfizer alone is investing over $8 billion
cost of drug development and only invented             this year and employing more than 12,000
“average” drugs, it would quickly go out of            scientists in the search for new cures, with
business.                                              significant investments in cardiovascular
   e enthusiasm and support among in-                 disease, cancer, HIV/AIDS and other infec-
vestors for pharmaceutical companies to find           tious diseases, central nervous system (CNS)
new cures depends on the expected returns              afflictions, and a wide range of other chronic
of a relative handful of products. A society           and acute diseases. New discoveries in these
that guarantees strong patent protection               areas are dependent on both the ingenuity of
helps give investors confidence that their             scientists and the confidence of the investors
high-risk investments might pay off down               who fund their investigations.
the road. Conversely, without confidence                   e support of the international commu-
that discovery of a new cure can produce a             nity for strong intellectual property rights
potentially large payout, investors in phar-           regimes is a key ingredient in bolstering that
maceutical firms, as well as pharmaceutical            confidence. 
firms looking to expand in other countries,
will demand that their funds be returned or
invest them elsewhere.
   If investors made the decision to pull out          Dr. Neal Masia is director of economic policy at
today and pharmaceutical research invest-              Pfizer, Inc.
ments stopped, consumers would not neces-

                                                                                                          83
          MALARIA:
     Partnering
         to
Find a Cure
                                                  By Richard Wilder and P. V. Venugopal




      very year, 300 to 500 million people
       around the world are infected with
malaria, and more than one million people
die of the disease. In Africa, the burden
                                                     After just five years of operation, MMV is
                                                  managing the largest-ever portfolio of malar-
                                                  ia drug research, with 21 projects in various
                                                  stages of development. Such a rapid advance
of malaria is on the rise for the first time      was made possible by MMV’s pioneering col-
in 20 years, fueled by the rapid spread of        laboration with nearly 40 public and private
resistance to widely used malaria drugs           institutions around the world. MMV, for ex-
like chloroquine. As a result, malaria is the     ample, looked to pharmaceutical companies
leading cause of death for children in Africa,    doing anticancer therapy research that has
killing 3,000 every day. These statistics rep-    led to the development of compounds that
resent an international disaster and a public     are highly active against the malaria parasite.
health failure.                                   ese companies share their knowledge with
   Despite the massive burden malaria rep-        MMV project teams once they enter into
resents for developing countries, only four       agreements with MMV.
of almost 1,400 new medicines developed              An integral part of agreements negotiated
worldwide between 1975 and 1999 were              by MMV is its innovative management of the
antimalarials. is is not enough to tackle        intellectual property that its partners bring
the problem, since new drugs are needed to        to the table. MMV manages the ownership
offset the malaria parasite’s pattern of devel-   and licensing of intellectual property so that
oping resistance to the ones in use.              the partner’s interests — whether academic,
   In 1999, talks between the World Health        commercial, or purely in the public interest
Organization (WHO) and the International          — are reflected in the terms of agreements.
Federation of Pharmaceutical Manufacturers        Depending on the circumstances, MMV may
Associations (IFPMA), in collaboration with       own the intellectual property outright, retain
a number of institutions, such as the World       licenses to the intellectual property, or have
Bank and the Rockefeller Foundation, led to       conditions in its agreements that, if not met,
the creation of the Medicines for Malaria         cause the intellectual property rights (IPR) to
Venture (MMV). MMV is a nonprofit orga-           be transferred back to MMV.
nization that brings public, private, and phil-      In many cases ownership of the intellec-
anthropic sector partners together to fund        tual property rights is not necessary, since
and manage the discovery, development, and        MMV is working with a company to both
registration of new medicines for the treat-      discover and develop a promising com-
ment and prevention of malaria.                   pound as an antimalarial. In those cases, for

84
                                                          Artemisia annua plants, used to produce
                                                          anti-malaria medications, on the
                                                          outskirts of Arusha, Tanzania.



                                                                 A 19th century bottle containing
                                                                 quinine. It was the primary drug
In Africa, malaria is on the rise for the first time in          in the treatment of malaria until
20 years. It is now the leading cause of death for                supplanted by synthetic drugs,
children in that continent.                                        such as chloroquine, which are
                                                                  becoming less effective against
                                                                                      this disease.


  example, the company may retain ownership                  One of MMV’s most promising drug
  of the intellectual property rights and use             candidates is a synthetic peroxide, first
  them while performing their obligations to              discovered by scientists from the Univer-
  MMV to develop and bring an antimalarial                sity of Nebraska Medical Center, Monash
  to market. e agreement will specify cer-               University in Australia, the Swiss Tropical
  tain conditions that have to be met, including          Institute, and Roche Pharmaceuticals. e
  price specifications and other conditions re-           drug resembles plant-derived artemisinins,
  lating to access to the antimalarial by people          today’s most effective antimalarials. rough
  in poorer countries. It is only in cases where          an agreement arranged by MMV, Roche
  the partner company cannot — or will not                Pharmaceuticals has transferred more than
  — fulfi ll its obligations that MMV needs the           three years of research results on synthetic
  rights to be returned to it, so as to go forward        peroxides to the Indian pharmaceutical firm
  with the project with a different partner.              Ranbaxy, to speed the drug’s development at
      Regardless of the nature of the intellec-           the lowest possible cost.
  tual property rights held by MMV, the de-                  Today, the drug is moving into clinical
  termining factor is its ability to carry out its        development, and could become the most
  mission. Consequently, the focus is not on              important new weapon against malaria in a
  the intellectual property rights per se, but            generation. is illustrates the result of inno-
  on the path that MMV must take to ensure                vative management of intellectual property
  that the new antimalarials being developed              rights by MMV to accomplish its goal — and
  under its supervision are brought to market             that of its partners — of bringing modern
  and made affordable and accessible to those             medicines to market to treat malaria. 
  who need them in the developing world. e
  intellectual property rights, then, are a tool
  to bring the partners in a given project to-
  gether for a common goal and to ensure that             Richard Wilder is a partner in the Washington,
  the path that MMV must take to achieve its              D.C., office of Sidley Austin Brown & Wood. Dr. P.V.
  goals is clear.                                         Venugopal is director of international operations for
                                                          the Medicines for Malaria Venture.




                                                                                                                  85
                          Protecting
Trademarks
       on the
      Internet                                     By Angelo Mazza




                ith the expansion of e-com-
                 merce through auction1 and
stand-alone Internet web sites that sell a
              2

wide range of products, trademark holders
                                                   ity and culpability of the web site.) Since the
                                                   laws and policies of each country and/or
                                                   auction site vary dramatically, the topic is
                                                   too complex for this short article. Currently,
in every country face a daunting enforce-          however, the preferred approach is to notify
ment challenge. While legitimate businesses        the offending auction site and offer an op-
can prosper on the Internet, their survival        portunity to cure the violation by removing
is threatened by unscrupulous rivals who           the offending offers. If the violation contin-
exploit loopholes to gain unfair advantages,       ues, responsible site operators close repeated
pass off counterfeit goods as legitimate, and      violators’ auction accounts.
evade enforcement. Many of these rogue                 is article will limit itself to a general
sites, though they appear to be unrelated to       overview of the issues related to stand-alone
each other or to be small operations, easily       sites selling counterfeit products. Focusing
can achieve gross revenues in the millions of      on current practices in the United States, we
dollars by exploiting weaknesses in current        will examine the scope of the problem, out-
laws and enforcement techniques.                   line the steps that need to be taken, review
     An international legal framework to           the pitfalls that each type of action brings,
protect legitimate trademark holders on            and determine what methods may succeed.
the Internet does not exist yet. As a result,
enforcement by the private sector and sup-         1
                                                       Auction web sites allow users to bid for items
portive governments requires persistence               sold by independent sellers. The sites offer a
and vigilance. Governments and rights hold-            variety of goods that range from the mundane
ers should be aware that they can take steps           to the specialized. Examples of such sites include
to protect their marks in an Internet world            eBay, Yahoo!, Sell.com, and iOffer, to name only
fi lled with round-the-clock sales by sellers          a few.
from many nations.                                 2
                                                       Stand-alone web sites are independent retail
     We can divide these enforcement strate-           sites that offer goods for sale via the Internet.
gies into two general areas, one to address            While there are many legitimate merchants, there
auctions sites and another for stand-alone             are also many sites that offer only counterfeit
sites. Auction sites present special challenges        goods for sale. The sites offer clothing, medicines,
to enforcement and raise site liability issues.        luxury goods, and anything else that can be
(Site liability refers to the legal responsibil-       copied for sale.

86
Widespread use of the Internet has sparked a revolution for sellers and customers. With E-commerce sites,
buying almost any product is just a few clicks away.




E-buyer beware: As of yet, there is no international
legal framework to protect customers or legitimate
trademark holders on the Internet.




                              The private sector must remain
                             committed to pursuing Internet
                           violators, in order to protect both
                               trademarks and unsuspecting
                                                   customers.



                                                                                                            87
   e process of dealing with web sites                Once a site selling counterfeit goods has
selling counterfeit goods can be very time-        been identified, however, the rights holder
consuming and, unfortunately, deprives the         prepares cease-and-desist letters and sends
rights holder of immediate relief. Success         them to the Internet Service Provider (ISP)
requires persistence and expertise. e In-         and to the site itself. In most instances, the
ternet presents special challenges for rights      site will ignore the letter. However, the site is
holders since, in many cases, the infringing       now on notice of violation and can no longer
web sites provide false or incomplete “Regis-      claim ignorance as to its illegal activities.
trant” information. is lack of accurate in-           Typically, ISPs are cooperative when con-
formation presents a major obstacle to rights      tacted, although, under the current system,
holders trying to locate the site and to police    they are not required to verify any of the
the sale of goods on the Internet.                 information they collect. Law-abiding ISPs
   Many legitimate companies employ teams          will remove infringing sites from their serv-
of in-house personnel, specialized software,       ers. However, this is not the case when the
and outside service providers to locate and        site selling counterfeit products becomes its
track sites selling counterfeit goods. Once a      own ISP and ignores all correspondence. In
rights holder identifies a site offering coun-     addition, there are instances of rogue ISPs
terfeit goods for sale, the holder can begin       that become safe harbors for infringing sites.
to collect data, review databases, and gather      e unintentional side effect of cooperative
Whois3 information, so as to identify those        ISPs is that many infringing sites eventually
responsible for the site.                          migrate to ISPs located outside the United
   In almost every instance, the site infor-       States, where laws differ and ISPs are often
mation gathered from the Whois database            less cooperative.
is woefully inadequate or completely false.            If contacting the site fails and the coun-
Given the lack of any penalties in the United      terfeiter engages in a game of moving to
States for providing false or misleading infor-    alternative ISPs, the rights holder may take
mation to a database, counterfeiters fi ll their   additional action. e rights holder may do
Whois information with periods, dashes,            more research and, in some instances, hire
names of dead personalities, and addresses         outside investigators to make purchases that
that have them living in Atlantis or other         may lead to the source of the items or of
improbable locations. Although there has           the site. ese investigations often reveal a
been talk of amending the applicable U.S.          variety of sources for the counterfeit goods.
laws to require more accurate information
when registering a domain name, those ef-
forts have yet to bear fruit.




Home pages of some major auction web sites.




88
Although many sites are in English and con-                 e enforcement problems outlined in
duct business in U.S. currency, more often               this article will be reduced only when gov-
than not they operate outside the borders                ernments create laws that level and harmo-
of the United States. In other instances, they           nize the Internet playing field and support
collect money in the United States, but ship             private enforcement efforts. e private sec-
counterfeit items to the purchasers from                 tor, in the meantime, must remain commit-
overseas locations. is creates additional               ted to pursuing Internet violators. 
enforcement problems for the rights holder,
who must retain overseas counsel and inves-
tigators to advance the investigation. Now
the rights holder faces mounting costs and               Angelo Mazza is a partner in the New York City
the peculiarities of enforcement in a foreign            firm of Gibney, Anthony & Flaherty, LLP, where he
jurisdiction.                                            specializes in and oversees day-to-day operations
    e rights holder may initiate legal action           in the Internet area. He is also the president of the
                                                         International AntiCounterfeiting Coalition
once enough information is gathered. e
                                                         (IACC) Foundation, the educational and training
legal action allows the rights holder to sub-            arm of the IACC .
poena ISP records related to the operation of
the site in question. Often, the ISP records
are outdated or no longer available. If the
site is part of a larger series of sites under
common ownership, it may merit a referral
to law enforcement for criminal prosecution.
However, given the lack of resources and spe-
cialized cybercrimes units, criminal actions
represent a small percentage of enforcement
actions. e owners of replica sites4 are
acutely aware of this lack of criminal en-
forcement as well.


3
    The Whois database provides contact and
    registration information for domain names.
4
    Replica sites openly sell copies of established or
    widely coveted goods.




Left, auction sites present special enforcement challenges. Right, the
Whois database, which provides contact and registration information for
domain names.


                                                                                                                 89
                                     Glossary of
                            Intellectual Property Terms
               A                                                  AUTHOR [copyright]. Either the real
               APPELLATION OF ORIGIN [trademark-                  person who creates a copyrightable work
               unfair competition]. A term that refers to         or the employer, corporate or individual, of
               both a product’s geographic origin and to its      a person who creates a copyrightable work
               distinctive product characteristics caused         within the scope of employment, or, in some
               by particular geographic conditions or             circumstances, the commissioning party of
               methods of production. Some distinguish            certain specified types of works. “Author”
               an appellation of origin from an “Indication       in copyright law includes not only writers
               of Source,” which refers solely to the             of novels, plays, and treatises, but also those
               geographic origin of production. Roquefort         who create computer programs, arrange
               cheese is an example of an appellation of          data in reference books, choreograph
               origin because it designates both geographic       dances, take photographs, sculpt stone,
               origin and product characteristics. “Paris”        paint murals, write songs, record sounds,
S O U R CE S




               perfume is an indication of source, which          and translate books from one language to
               refers only to geographic origin. e term          another. (See WORK MADE FOR HIRE,
               “Geographic Denomination” encompasses              JOINT AUTHORS.)
               both categories.
                                                                  B
               ASSIGNMENT [patent-trademark-
               copyright]. A transfer of rights in                BERNE CONVENTION [copyright-
               intellectual property. An assignment of a          international]. e major multilateral
               patent, for example, is a transfer of sufficient   copyright treaty, signed in Berne,
               rights so that the recipient has title to the      Switzerland, in 1886. e Berne Convention,
               patent. e assignment can be a transfer of         whose members form the Berne Union, is
               all rights of exclusivity in the patent, of an     adhered to by nearly 150 nations, including
               undivided portion (for example, a 50 percent       the United States. e World Intellectual
               interest), or of all rights within a specified     Property Organization (WIPO) serves as the
               location (for example, a certain area of the       administering agency for the activities of the
               United States). Transfer of anything less is       Berne Union.
               considered to be a “license.”
                                                                  BEST MODE [patent]. A condition for the
               AUDIOVISUAL WORK [copyright].                      grant of a valid patent. An inventor must
               A copyrightable work consisting of                 describe the best method he or she knows
               images that are related, presented in a            for carrying out the invention.
               series, and intended to be shown by the
               use of a machine, as well as any sound             C
               accompanying the work. A common
               example of an audiovisual work is a                COMMUNITY TRADE MARK CTM
               slide show, such as that used in a sales           [trademark-international]. A trademark
               presentation, a lecture, or an introduction to     registration granted by the European
               a museum.                                          Union’s Office for Harmonization in the
                                                                  Internal Market and enforceable throughout
                                                                  EU member nations.



               90
COMPILATION [copyright]. A                      COUNTERFEITING [trademark]. e act
copyrightable work consisting of a collection   of producing or selling a product containing
and assembly of preexisting material. e        a sham mark that is an intentional and
assembly must exhibit at least minimal          calculated reproduction of the genuine
originality in the selection, organization,     mark. A “counterfeit mark” is identical to
and arrangement of the material without         or substantially indistinguishable from the
making any internal changes in it.              genuine mark. Often, counterfeit goods are
                                                made to imitate a popular product in all
CONTRIBUTORY INFRINGEMENT                       details of construction and appearance, so
[patent-trademark-copyright]. Indirect          as to deceive customers into thinking they
infringement of intellectual property           are purchasing the genuine merchandise.
rights in which one person contributes to
the direct act of infringement of another.      CYBERSQUATTING [trademark].
Contributory infringement of a trademark,       “Cybersquatting” and “cyberpiracy” are
for example, occurs when a manufacturer         synonymous terms that refer to the same
of goods aids or encourages its distributors    type of unfair competition for web sites.
to pass off its goods as those of another       e typical “cybersquatter” is one who
manufacturer.                                   knowingly reserves with a registrar a
                                                domain name consisting of the trademark
COPIES [copyright]. As a noun, “copies”         or name of a company for the purpose of
means the material objects that store or        selling the right to that domain name back
fi x copyrightable information other than       to the legitimate owner.
sounds; as a verb, the act of copying.
                                                D
COPYING [copyright-patent-trademark].
In copyright law, “copying” denotes two         DEPENDENT claim [patent]. A claim in a
separate but interrelated concepts. To          patent that refers back to a previous claim
constitute an infringement of copyright,        and defines an invention that is narrower
a work must be a “copy” in the sense that       in scope than that in the previous claim. A
it is substantially similar to a copyrighted    dependent claim must be written so as to be
work, it must have been “copied” from           more restricted than the technology defined
the copyrighted work as opposed to being        in the previous claim.
the result of coincidental, independent
production or from being taken from the         DERIVATIVE WORK [copyright].
same source as the copyrighted work.            A work based on a preexisting work that is
Legal standards for infringement of             changed, condensed, recast, or embellished
copyright differ from those for patents and     in some way.
trademarks, neither of which require proof
of copying.                                     DESCRIPTIVE MARK [trademark].
                                                A word, picture, or other symbol that
COPYRIGHT [copyright]. An exclusive             describes something about the goods or
right granted or conferred by the               services in connection with which it is
government on the creator of a work             used, such as purpose, their size or color,
to exclude others from reproducing it,          the class of users, or the end effect on users.
adapting it, distributing it to the public,     A descriptive term is not considered to be
performing it in public, or displaying it       inherently distinctive; to establish validity
in public. Copyright does not protect an        for registration or protection in court, it
abstract idea; it protects only the concrete    needs proof of acquired distinctiveness,
form of expression in a work. To be valid, a    known as “secondary meaning.” (See
copyrighted work must have originality and      SECONDARY MEANING, SUGGESTIVE
possess a modicum of creativity.                MARK).

                                                                                             91
                                                  DOMAIN NAME [trademark]. e names
DESIGN PATENT [patent]. A government              and words that companies designate for
grant of exclusive rights in a novel,             their registered Internet web site addresses,
nonobvious, and ornamental industrial             also referred to as a “URL.” For example:
design. A design patent confers the right         <www.coca-cola.com > is a domain name
to exclude others from making, using,             identifying the site of e Coca-Cola
or selling designs that closely resemble          Company. Technologically, each domain
the patented design. A design patent              name is unique and cannot be shared.
covers ornamental aspects of a design; its        Domain names are registered on a first-
functional aspects are covered by a utility       come, first-served basis.
patent. A design patent and a utility patent
can cover different aspects of the same           DURATION [patent-trademark-copyright-
article, such as an automobile or a table         trade secret-right of publicity]. e term or
lamp.                                             length of time that an intellectual property
                                                  right lasts. As a result of the Uruguay Round
DIGITAL MILLENNIUM COPYRIGHT                      Agreements Act, U.S. law was changed,
ACT [copyright]. A major piece of U.S.            effective June 8, 1995, to adopt a patent
legislation adopted in 1998 that extensively      term of 20 years from the date on which the
amended the copyright laws, in part               patent application was fi led. A trademark
to conform U.S. law to various treaty             continues in duration as long as there is no
obligations, and in part to modernize the         abandonment of rights by nonuse or by acts
law to take into account various new digital      that cause the term to lose its significance
technologies.                                     as an indicator of origin and to become
                                                  a generic name. e basic duration of a
DILUTION [trademark]. A type of                   copyright is the life of the author plus 70
violation of a strong trademark in which the      years. Protection of information as a trade
defendant’s use, while not causing likelihood     secret lasts as long as the information
of confusion, blurs the distinctiveness or        remains secret.
tarnishes the image of the plaintiff ’s mark.
To possess the selling power and recognition      E
protected by the antidilution statutes, the
mark must be relatively strong and famous.        ECONOMIC ESPIONAGE ACT (EEA)
                                                  [trade secret]. A U.S. statute, adopted in
DISTRIBUTION RIGHT [copyright]. One               1996, which provides criminal penalties for
of the six exclusive rights held by a copyright   the theft of trade secrets. e EEA makes
owner, under which the copyright owner            it illegal to steal or fraudulently obtain
has the exclusive right to distribute copies      trade secrets for the benefit of a foreign
or phonorecords of the work to the public         government, instrumentality, or agent and
by sale, lease, or rental. Unlike the other       steal trade secrets that benefit “anyone other
rights of copyright, the distribution right       than the owner.”
is infringed merely by a transfer of copies
of the work, whether those copies were            EQUIVALENTS, DOCTRINE OF [patent].
unlawfully or lawfully made, except under         A rule of claim interpretation under which
the “First Sale Doctrine.” (See FIRST SALE        a product or process, although not a literal
DOCTRINE.)                                        infringement, is still an infringement if it
                                                  performs substantially the same way as the
                                                  patented invention.




92
F                                                 the new intent-to-use system, an application
                                                  for registration can be fi led prior to actual
FAIR USE [copyright-trademark]. A defense         use of mark. (See INTENT-TO-USE
to a charge of copyright or trademark             APPLICATION.)
infringement. For copyrights, U.S. courts
consider four factors in determining if a         FIRST TO INVENT [patent]. A rule
fair use defense exists: the purpose and          under which patent priority is determined
character of the disputed use; the nature         by which inventor was the first to actually
of the copyrighted work; the importance           invent, rather than who was the first to fi le a
of the portion used in relation to the work       patent application. First to invent is the rule
as a whole; and the effect of the use on          followed in the United States.
the potential market for or value of the
copyrighted work. For trademarks, the             FUNCTIONALITY [patent-trademark-
secondary user must show that he or she           copyright]. at aspect of design that makes
is not using a descriptive, geographically        a product work better for its intended
descriptive, or personal name mark in a           purpose, as opposed to making the product
trademark sense but only to describe his or       look better or to identifying its commercial
her goods or services or their geographic         source.
origin, or to name the person running the
business.                                         G

FIELD OF USE RESTRICTION [general                 GENERIC NAME [trademark]. A word
intellectual property-antitrust]. A provision     used by most people to name a class or
in an intellectual property license restricting   category of product or service, such as
the licensee to use of the licensed property      “cellular phone.” No one person may have
only in a defined product or service market.      trademark rights to a generic name.

FIRST SALE DOCTRINE [copyright].                  GOOD WILL [trademark]. e value of a
An exception to the exclusive right of a          business or of a line of goods or services that
copyright owner to distribute copies or           reflects commercial reputation. A business
phonorecords of the copyrighted work.             with a well-established good will could see
Under this principle, the copyright owner         all of its tangible assets destroyed, yet still
has the right to sell a copy of a book but not    own its reputation, its good will. Trademark
the right to control subsequent sales of that     infringement is a form of theft of good
copy. (See DISTRIBUTION RIGHT.)                   will, since a trademark or service mark is a
                                                  symbol of a business’ good will.
FIRST TO FILE [patent-trademark].
For patents, a rule under which patent            I
priority, and thus entitlement to a patent, is
determined by which inventor was the first        IDEA-EXPRESSION DICHOTOMY
to fi le a patent application, rather than who    [copyright]. e fundamental rule of law
was first to actually invent. is is the rule     that copyright does not protect an idea;
followed by almost every nation in the world      copyright protects only specific expressions
except the United States. For trademarks,         of an idea.
priority among conflicting applications to
register trademarks is handled by publishing
the application with the earliest fi ling date
for possible opposition by the applicant with
the later fi ling date. In the United States,
ownership of a trademark is determined by
who was first to use it, not by who was first
to fi le an application for registration. Under

                                                                                                93
INFRINGEMENT [general intellectual              J
property]. An invasion of one of the
exclusive rights of intellectual property.      JOINT AUTHORS [copyright]. e
Infringement of a utility patent involves       collaborating creators of a single
the making, using, selling, offering to sell,   copyrightable work who merge their
or importing of a patented product or           separate contributions to the work. Joint
process without permission. Infringement        authorship implies joint ownership of
of a design patent involves fabrication of      copyright in the work created. Co-owners
a design that, to the ordinary person, is       of a copyright are treated as “tenants in
substantially the same as an existing design,   common,” with each co-owner having an
where the resemblance is intended to            independent right to license the use of a
induce an individual to purchase one thing      work, subject to a duty of accounting to the
supposing it to be another. Infringement of a   co-owners for any profits.
trademark consists of the unauthorized use
or imitation of a mark that is the property     JOINT INVENTORS [patent]. Two or
of another in order to deceive, confuse, or     more inventors of a single invention who
mislead others. Infringement of a copyright     collaborate in the inventive process.
involves reproducing, adapting, distributing,
performing in public, or displaying in public   K
the copyrighted work of someone else.
                                                KNOCK-OFF [patent-trademark-
INTELLECTUAL PROPERTY [patent-                  copyright]. An identical copy of a work or
trademark-unfair competition-copyright-         product protected by patent, trademark,
trade secret-moral rights]. Certain creations   trade dress, or copyright. When used as a
of the human mind that have commercial          verb, the act of producing such a copy.
value and are given the legal aspects of a
property right. “Intellectual property” is an   KNOW-HOW [trade secret]. Information
all-encompassing term now widely used           that enables a person to accomplish a
to designate as a group all of the following    particular task or to operate a particular
fields of law: patent, trademark, unfair        device or process.
competition, copyright, trade secret, moral
rights, and the right of publicity.             L

INTENT-TO-USE APPLICATION                       LICENSE [patent-trademark-copyright]. A
[trademark]. Since 1989 in the United States,   permission to use an intellectual property
an optional method of applying for federal      right, under defined conditions – as to
registration of a mark on the Principal         time, context, market line, or territory.
Register based upon a declared good-faith       In intellectual property law, important
intention to use a mark on defined goods        distinctions exist between “exclusive
or services.                                    licenses” and “nonexclusive licenses.” An
                                                exclusive license does not necessarily mean
INVENTION [patent]. e human creation           that this is the one and only license granted
of a new technical idea and the physical        by the licensor. In giving an exclusive
means to accomplish or embody the idea.         license, the licensor promises that he or
                                                she will not grant other licenses of the
                                                same rights within the same scope or field
                                                covered by the exclusive license. However,
                                                the owner of rights may grant any number
                                                of nonexclusive licenses of the same rights.
                                                In a nonexclusive license, title remains
                                                with the licensor. A patent license is a
                                                transfer of rights that does not amount to

94
an assignment of the patent. A trademark          MUSICAL WORK [copyright]. A category
or service mark can be validly licensed           of copyrightable work expressed in notation
only if the licensor controls the nature and      or sounds. A musical work can be embodied
quality of the goods or services sold by the      and fi xed in physical objects that are
licensee under the licensed mark. Under           classified as either “copies” (sheet music)
copyright law, an exclusive licensee is the       or “phonorecords” (e.g., compact discs or
owner of a particular right of copyright, and     tapes). A composer’s song is covered by a
he or she may sue for infringement of the         musical work copyright, but a recording of
licensed right. ere is never more than a         the song is covered by a sound recording
single copyright in a work regardless of the      copyright.
owner’s exclusive license of various rights to
different persons.                                N

LOGO [trademark]. A graphic                       NOTICE [patent-copyright-trademark].
representation or symbol of a company             A formal sign or notification attached to
name or trademark, usually designed for           physical objects that embody or reproduce
ready recognition. e term has no legal           an intellectual property right — for
significance in the law of trademark.             example, the use of the word “patent” or
                                                  its abbreviation, “pat.,” together with the
M                                                 patent number, on a patented article made
                                                  by a patent holder or his/her licensees. e
MISAPPROPRIATION [unfair                          formal statutory notice of U.S. trademark
competition]. A common-law form of unfair         registration is the letter R in a circle symbol
competition where the defendant has copied
or appropriated some item or creation of
                                                  ® , “Reg. U.S. Pat. & Tm. Off.,” or “Registered
                                                  in U.S. Patent and Trademark Office.” Many
the plaintiff that is not protected by either     firms use informal trademark notices, such
patent law, copyright law, trademark law,         as “Brand,” “TM,” “Trademark,” “SM,” or
or any other traditional theory of exclusive      “Service Mark,” adjacent to words or other
rights.                                           symbols considered to be protectable marks.
                                                  Notice of copyright consists of the letter C
MORAL RIGHTS [copyright-author’s                  in a circle symbol © or the word “Copr.” or
rights]. Some European and other nations’         “Copyright,” the copyright owner’s name,
legal systems expressly recognize certain         and the year of first publication.
rights of authors beyond those strictly
recognized in copyright law. Moral rights         NOVELTY [patent]. One of the three
generally fall into three categories: the right   conditions that an invention must meet in
of an author to receive credit as the author      order to be patentable. Novelty is present if
of a work, to prevent others from falsely         every element of the claimed invention is
being named author, and to prevent use            not disclosed in a single piece of prior art.
of the author’s name in connection with
works the author did not create; the right of     O
an author to prevent mutilation of a work;
and the right to withdraw a work from             OBVIOUSNESS [patent]. A condition of
distribution if it no longer represents the       non-patentability in which an invention
views of the author.                              cannot receive a valid patent because a
                                                  person with ordinary skill in that technology
                                                  can readily deduce it from publicly available
                                                  information (prior art).




                                                                                               95
ON SALE [patent]. An inventor cannot             expires, the public is entitled to make and
obtain a valid patent if he or she waits for     use the invention and is entitled to a full and
more than the one-year grace period to           complete disclosure of how to do so.
fi le a patent application after a product
embodying the invention has been placed          PERFORMANCE [copyright]. To recite,
“on sale.”                                       render, play, dance, or act a copyrighted
                                                 work, including the broadcast by radio
ORDINARY SKILL IN THE ART                        or television of a performance and
[patent]. at level of technical knowledge,      the reception of such a broadcast. e
experience, and expertise possessed by           exclusive right to “perform the copyrighted
the run-of-the-mill or ordinary engineer,        work publicly” is granted to all types of
scientist, or designer in the technology that    copyrighted works, except for pictorial and
is relevant to the invention.                    sculptural works and sound recordings.

P                                                PHONORECORDS [copyright].
                                                 e material objects that store or
PASSING OFF [trademark]. (1) e                  fi x copyrightable sounds, other than
substitution of one brand of goods when          soundtrack accompanying a motion picture.
another brand is ordered. (2) Trademark          Phonorecords can be audiotapes, compact
infringement where the infringer                 discs, computer chips that store sounds, and
intentionally meant to mislead or deceive        the like.
purchasers. (3) Trademark infringement
where there is no proof of intent to deceive     PIRACY [copyright-trademark]. e
but likelihood of confusion is proven. (4)       act of exact, unauthorized, and illegal
In British-law countries, acts illegal under     reproduction on a commercial scale of
the common law, apart from registered            a copyrighted work or of a trademarked
“trademark” law, and consisting of the           product.
misrepresentation of one’s goods or services
as those of a competitor, usually by using a     PRIOR ART [patent]. e existing body of
similar mark.                                    technological information against which an
                                                 invention is judged to determine if it can be
PATENT [patent]. In the United States,           patented as being a novel and nonobvious
a grant by the federal government to an          invention.
inventor of the right to exclude others from
making, using, or selling the invention.         PROCESS CLAIM [patent]. A claim of a
ere are three very different kinds of           patent that covers the method by which an
patents in the United States: a utility patent   invention is performed by defining a series
on the functional aspects of products and        of steps to be followed. is is in contrast to
processes; a design patent on the ornamental     a product claim or apparatus claim, which
design of useful objects; and a plant patent     cover the structure of a product.
on a new variety of living plant. Patents
do not protect “ideas,” only structures and      PRODUCT-BY-PROCESS CLAIM
methods that apply technological concepts.       [patent]. A patent claim in which a product
In return for receiving the right to exclude     is claimed by defining the process by which
others from a precisely defined scope of         it is made. e product-by-process form
technology, industrial design, or plant          of claim is most often used to define new
variety, which is the gist of a patent, the      chemical compounds, since many new
inventor must fully disclose the details of      chemicals, pharmaceuticals, and drugs can
the invention to the public. is will enable     only practicably be defined by the process of
others to understand the invention and be        making them.
able to use it as a steppingstone to further
develop the technology. Once the patent

96
PRODUCT CLAIM [patent]. A claim of a            RIGHT OF PUBLICITY [general
patent that covers a structure, apparatus, or   intellectual property]. e inherent right
composition. is is in contrast to a “process   of every human being to control the
claim,” which covers a method or process.       commercial use of his or her identity.

PUBLICATION [copyright]. e                     S
distribution of copies or phonorecords of a
work to the public.                             SECONDARY MEANING [trademark]. A
                                                meaning for a trademark or service mark
PUBLIC DOMAIN [general intellectual             that customers associate with a particular
property]. e status of an invention,           brand of products or services. For trade
creative work, and commercial symbol that       symbols that are not inherently distinctive,
is not protected by any form of intellectual    distinctiveness must be acquired in order to
property law. Items in the public domain        be protected by a trademark or service mark.
are available for free copying and use by       is acquired distinctiveness is known as
anyone. e copying of items that are in         “secondary meaning” because it is acquired
the public domain is not only tolerated but     second in time to the primary meaning of
encouraged as a vital part of the competitive   a word. For example, a word such as “best”
process. (See COPYING, INTELLECTUAL             for milk is regarded as descriptive and not
PROPERTY.)                                      inherently distinctive. e primary meaning
                                                is that milk thus described is purported to
R                                               be the best. To achieve exclusive trademark
                                                rights for a product called “Best Milk,” a
REDUCTION TO PRACTICE [patent].                 seller using this word must use it so that it
e physical part of the inventive process       achieves a secondary meaning denoting that
that completes and ends the process of          all milk marked “best” comes from a single
invention. After a reduction to practice,       commercial source.
the invention is complete for patent law
purposes.                                       SERVICE MARK [trademark]. A word,
                                                slogan, design, picture, or any other symbol
RENEWAL [trademark-copyright]. e               used to identify and distinguish services
extension of a registration of a trademark or   (retail sales services, airlines services,
the extension of a copyright.                   insurance, investment services, and the like)
                                                as opposed to a product.
REVERSE ENGINEERING [trade secret-
copyright]. A method of obtaining technical     SKILL IN THE ART [patent]. An ordinary
information by starting with a publicly         level of proficiency in the particular
available product and determining what it       technology in which an invention is made.
is made of, what makes it work, or how it
was produced. e engineering effort goes        SOUND RECORDING [copyright]. A
in the reverse direction of usual engineering   category of copyrightable work consisting
efforts, which start with technical data and    of the sounds that are recorded in a
use it to produce a product. If the product     phonorecord.
or other material that is the subject of the
reverse engineering was properly obtained,
the process of reverse engineering is not
infringement of any trade secrets in the data
embodied in a product and it is legitimate
and legal competitive behavior.




                                                                                            97
SPECIAL 301 [international trade]. U.S.          T
statutory provisions requiring annual review
of trade agreement rights and foreign trade      TRADE DRESS [trademark]. e totality
practices of U.S. trading partners that deny     of elements in which a product or service
benefits to the United States or unjustifiably   is packaged or presented, such as the shape
restrict or burden U.S. commerce. e Trade       and appearance of a product or container,
Act of 1974, as amended by the Special 301       or the cover of a book or magazine. ese
provisions of the 1988 Omnibus Trade and         elements combine to create a visual image
Competitiveness Act, authorizes the U. S.        presented to customers and are capable of
Trade Representative (USTR) to identify          acquiring exclusive legal rights as a type of
and investigate potential violating countries,   trademark or identifying symbol of origin.
recommend the suspension of trade
agreement concessions and the imposition         TRADEMARK [trademark]. (1) A word,
of duties and import restrictions, and enter     slogan, design, picture, or any other symbol
into agreements to eliminate the burdens or      used to identify and distinguish goods.
restrictions on U.S. trade.                      (2) Any identifying symbol, including a
                                                 word, design, or shape of a product or
SUBSTANTIAL SIMILARITY                           container, that qualifies for legal status as a
[copyright]. e degree of resemblance            trademark, service mark, collective mark,
between a copyrighted work and a second          certification mark, trade name, or trade
work that is sufficient to constitute            dress. Trademarks identify one seller’s goods
copyright infringement by the second work.       and distinguish them from goods sold by
Exact word-for-word or line-for-line identity    others. ey signify that all goods bearing
does not define the limits of copyright          the mark come from or are controlled by
infringement. U.S. courts have chosen            a single source and are of an equal level of
the flexible phrase “substantial similarity”     quality. A trademark is infringed by another
to define that level of similarity that will,    if the second use causes confusion of source,
together with proof of validity and copying,     affiliation, connection, or sponsorship.
constitute copyright infringement.
                                                 TRADE NAME [trademark]. A symbol
SUGGESTIVE MARK [trademark]. A                   used to identify and distinguish companies,
word, picture, or other symbol that suggests,    partnerships, and businesses, as opposed
but does not directly describe, something        to marks used to identify and distinguish
about the goods or services in connection        goods or services.
with which it is used as a mark. A suggestive
term is considered to be inherently              TRADE SECRET [trade secret]. Business
distinctive and needs no proof of secondary      information that is the subject of reasonable
meaning for registration or protection in        efforts to preserve confidentiality and has
court. For example, a polar bear for parkas      value because it is not generally known in
and coats merely suggests the kind of            the trade. Such confidential information
protection that a polar bear has from the        will be protected against those who obtain
cold. (See DESCRIPTIVE MARK.)                    access through improper methods or by
                                                 a breach of confidence. Infringement of a
                                                 trade secret is a type of unfair competition.




98
U                                              WORLD TRADE ORGANIZATION
                                               (WTO) [international]. WTO is the only
UNFAIR COMPETITION [general                    global international organization dealing
intellectual property]. Commercial conduct     with the rules of trade between nations.
that the law views as unjust. A person         Located in Geneva, Switzerland, it was
injured by an act of unfair competition is     created at the end of the Uruguay Round of
entitled to relief in a civil action against   the General Agreement on Tariffs and Trade
the perpetrator of the act. Trademark          (GATT) negotiations in December 1993 to
infringement has long been considered to be    oversee the operation of GATT. e WTO
unfair competition. Other legal categories     entered into force with respect to the United
recognized as being types of unfair            States on January 1, 1995. e WTO often
competition are false advertising, product     plays much the same role in world financial
disparagement/trade libel, infringement of     and economic affairs as the United Nations
a trade secret, infringement of the right of   does in political affairs. Activities of WTO
publicity, and misappropriation.               include: administering trade agreements;
                                               acting as a forum for trade negotiations;
UTILITY [patent]. e usefulness of a           settling trade disputes; reviewing national
patented invention. To be patentable, an       trade policies; assisting developing countries
invention must operate and be capable of       in trade policy issues through technical
use, and it must perform some “useful”         assistance and training programs; and
function for society.                          cooperating with other international
                                               organizations. One hundred forty-eight
W                                              nations are members of the WTO (as of
                                               June 2005), accounting for over 97 percent
WORLD INTELLECTUAL PROPERTY                    of world trade.
ORGANIZATION (WIPO) [international].
One of the 16 “specialized agencies” of the
United Nations system. WIPO, located
in Geneva, Switzerland, was created in         e information that is presented here was
1967 and is responsible for the promotion      adapted and excerpted with permission
of the protection of intellectual property     from McCarthy’s Desk Encyclopedia of
throughout the world. WIPO fulfi lls this      Intellectual Property, ird Edition, by
responsibility by promoting cooperation        J. omas McCarthy, Roger E. Schechter,
among nations in intellectual property         and David J. Franklyn. Copyright © 2004
matters, administering various “unions”        by e Bureau of National Affairs, Inc.,
and other treaty organizations founded on      Washington, D.C. 20037. To contact BNA
multilateral treaties, and creating model      Books, call toll free 1-800-960-1220 or visit
laws for adoption by developing nations.       www.bnabooks.com.

WORK MADE FOR HIRE [copyright].
A work prepared by an employee within
the scope of his or her employment or a
commissioned work that the parties agree in
writing to treat as a work made for hire. e
real person, partnership, or corporation for
whom the work was prepared is considered
to be both the “author” and the owner of
copyright from the moment of creation of
the work.




                                                                                               99
                Sources of Information on
                  Intellectual Property
U.S. Government                                  U.S. Department of Justice
                                                 Computer Crime and Intellectual Property
Office of the U.S. Trade Representative          Section (CCIPS)
600 17th Street, N.W.                            10th & Constitution Ave., N.W.
Washington, D.C. 20506 U.S.A.                    John C. Keeney Building, Suite 600
Tel: 1-888-473-8787                              Washington, D.C. 20530
E-mail: contactustr@ustr.eop.gov                 Tel: 202- 514-1026
Internet: http://www.ustr.gov                    Fax: 202- 514-6113
Internet site includes reports, speeches,        Internet: http://www.cybercrime.gov/
press releases, and other documentation on       ip.html
a range of trade-related subjects, including     Internet site offers, among many topics,
intellectual property (IP).                      an overview of IP policy and programs,
                                                 guidance to law enforcement on the
U.S. Department of Commerce                      investigation and prosecution of violations
International Trade Administration               of federal intellectual property laws, and a
14th Street and Constitution Avenue, N.W.        comprehensive listing of federal criminal
Washington, D.C. 20230 U.S.A.                    laws that pertain to the protection of IPR.
Tel: 202-482-3809
E-mail: tic@ita.doc.gov                          U.S. Department of State
Internet: http://www.ita.doc.gov/                Bureau of Economic and Business Affairs
Internet site includes periodically updated      Trade Policy and Programs
articles on U.S. intellectual property rights    Office of International Intellectual Property
laws, "Special 301" enforcement activities,      Enforcement
and the TRIPS Agreement.                         2201 C Street, N.W.
                                                 Washington, D.C. 20520 U.S.A.
U.S. Department of Commerce                      Tel: 202-647-3251
Strategy Targeting Organized Piracy (STOP)       Internet: http://www.state.gov/e/eb/tpp/
Internet: http://www.export.gov/stop_fakes_      Internet site provides an overview of
gov/index.asp                                    economic and trade topics arranged by
is is the Internet site for a recent U.S.       current issues; press statements; remarks,
initiative that helps U.S. businesses protect    testimony, and briefings; topics; and regional
their intellectual property at home              information.
and abroad.
                                                 International Intellectual Property
U.S. Department of Commerce                      Rights Training Database
U.S. Patent and Trademark Office                 http://www.training.ipr.gov/
P.O. Box 1450                                    is database, maintained by U.S.
Alexandria, Virginia 22313-1450 U.S.A.           government agencies and IP industry
Tel: 703-308-4357                                associations and sponsored by the U.S.
Internet: http://www.uspto.gov                   Department of State, provides training
Internet site provides access to information     and technical assistance relating to
on intellectual property as related to patents   protecting IPR.
and trademarks, including rules, advice,
definitions, submission forms, fees,
and more.

100
U.S. Immigration and Customs                   Internet: http://www.european-patent-
Enforcement                                    office.org/index.en.php
National Intellectual Property Rights          Internet site includes general information
Coordination Center                            about the European Patent Office, official
1300 Pennsylvania Avenue, N.W., Rm. 3.5A       communications, a patent information
Washington, D.C. 20229 U.S.A.                  center, a toolbox for applicants, and patent
Phone: 202-344-2410                            information products.
Fax: 202-344-1920
Internet: http://www.ice.gov/graphics/         World Intellectual Property
cornerstone/ipr                                Organization
e National Intellectual Property Rights       P.O. Box 18
Coordination Center (IPR Center) is            CH-1211 Geneva 20, Switzerland
a multi-agency center responsible for          Tel: +41-22 338 9111
coordinating a unified U.S. government         Fax: +41-22 733 54 28
response regarding IPR enforcement             Internet: http://www.wipo.int
issues. Investigative personnel provide core   Internet site provides the history and
staffing from Immigration and Customs          objectives of this organization, as well as a
Enforcement (ICE) and the Federal Bureau       list of its members, the texts of treaties it
of Investigation (FBI). Particular emphasis    administers, and a list of contracting parties
is given to investigating major criminal       or signatories to these treaties.
organizations and those using the Internet
to facilitate IPR crime.                       World Trade Organization
                                               154 Rue de Lausanne
U.S. Customs and Border Protection             CH-1211 Geneva 21, Switzerland
1300 Pennsylvania Avenue, N.W.                 Tel: 41-22-739-5111
Washington, D.C. 20229 U.S.A.                  Fax: 41-22-731-4206
Tel: 202-354-1000                              E-mail: enquiries@wto.org
Internet: http://www.cbp.gov/xp/cgov/          Internet: http://www.wto.org/english/
import/commercial_enforcement/ipr/             tratop_e/trips_e/trips_e.htm
Internet site has information on all aspects   Internet site, in addition to providing
of IPR enforcement in the United States.       general information about the WTO,
                                               includes special sections on topics such as
U.S. Library of Congress                       goods, services, environment, development,
U.S. Copyright Office                          dispute settlement, and IP.
101 Independence Avenue, S.E.
Washington, D.C. 20559-6000
Tel: 202-707-3000                              Associations and Trade Organizations
Internet: http://www.copyright.gov
Internet site presents a publication titled    American Intellectual Property Law
Copyright Basics, as well as information       Association
on copyright, including frequently asked       2001 Jefferson Davis Highway
questions, and documents of the World          Suite 203
Intellectual Property Organization.            Arlington, Virginia 22202 U.S.A.
                                               Tel: 703-415-0780
International Organizations                    Fax: 703-415-0786
                                               E-mail: aipla@aipla.org
European Patent Office                         Internet: http://www.aipla.org
Erhardtstrasse 27                              Internet site provides information aimed
D-80331 Munich                                 at improving laws relating to patents,
Germany                                        trademarks, copyrights, unfair competition,
Tel: (+49 89) 23 99 -0                         and other fields of IP.
Fax: (+49 89) 23 99-44 65

                                                                                          101
American Society of Composers,                  U.S. copyright-based industries in bilateral
Authors, and Publishers                         and multilateral efforts to improve the
One Lincoln Plaza                               international protection of copyrighted
New York, New York 10023 U.S.A.                 works), as well as reports on worldwide
Tel: 212-621-6000                               piracy by country and issue.
Fax: 212-724-9064
E-mail: info@ascap.com                          Motion Picture Association of America
Internet: http://www.ascap.com                  1600 Eye Street, N.W.
Internet site for this membership association   Washington, D.C. 20006 U.S.A.
of over 68,000 composers, songwriters,          Tel: 202-293-1966
lyricists, and music publishers provides        Internet: http://www.mpaa.org
information aimed at protecting the rights      Internet site for this organization and its in-
of its members by licensing and paying          ternational counterpart, the Motion Picture
royalties for the public performance of their   Association, which serve as a voice for the
copyrighted works.                              motion picture, home video, and television
                                                industries. It includes information on MPAA
Association of American Publishers, Inc.        anti-piracy efforts and its positions on laws
50 F Street, N.W.                               and regulations governing the industries.
Suite 400
Washington, D.C. 20001 U.S.A.                   Music Publishers Association
Tel: 202-347-3375                               243 Fifth Avenue, Suite 236
Fax: 202-347-3690                               New York, New York 10016 U.S.A.
Internet: http://www.publishers.org             Tel/Fax: 212-327-4044
Internet site for the principal trade           Internet: http://www.mpa.org
association of the U.S. book publishing         rough its copyright resource centers,
industry contains information on copyright      this association disseminates copyright
and electronic publishing.                      information with the aim of increasing
                                                copyright responsibility; also includes links
Business Software Alliance                      to music information resources on the
1150 18th Street, N.W.                          World Wide Web.
Suite 700
Washington, D.C. 20036 U.S.A.                   National Music Publishers Association
Tel: 202-872-5500                               711 ird Avenue
Fax: 202-872-5501                               New York, New York 10017 U.S.A.
Internet: http://www.bsa.org                    Tel: 212-834-0100
Internet site reports on the activities of      Fax: 646- 487-6779
software-industry organization with piracy      Internet: http://www.nmpa.org
enforcement programs in 65 countries and        Internet site for this association — which
anti-piracy hotlines operating in nearly        is concerned with legislative, legal, and
all nations; includes a list of international   educational matters related to copyright
addresses of BSA offices.                       and new technology — includes extensive
                                                frequently asked questions about copyright
International Intellectual Property             and licensing.
Alliance
1747 Pennsylvania Avenue, N.W.                  Software Publishers Association
Suite 825                                       1730 M Street, N.W.
Washington, D.C. 20006 U.S.A.                   Suite 700
Tel: 202-872-5500                               Washington, D.C. 20036-4510 U.S.A.
Fax: 202-872-5501                               Tel: 202-452-1600
Internet: http://www.iipa.com                   Internet: http://www.siia.net
Internet site includes general information      Internet site provides information related to
on the IIPA (a coalition that represents        fighting software piracy.

102
Educational Institutions                         University of Iowa
(Internet Sites)                                 Copyright and Multimedia Law for Web
                                                 Builders and Multimedia Authors
Berkeley Digital Library SunSITE                 http://bailiwick.lib.uiowa.edu/webbuilder/
http://sunsite.berkeley.edu/Copyright/           copyright.html
Sponsored by the Library at the University       Includes IP law articles, primers, and useful
of California at Berkeley and Sun                links to other web sites, institutions, and
Microsystems, Inc., this Internet site offers    core documents.
articles; references; lists of initiatives and
projects; and links on copyright, IPR, and       University of Washington School of Law
licensing issues.                                Center for Advanced Study and Research
                                                 on Intellectual Property (CASRIP)
Cornell University                               http://www.law.washington.edu/Casrip
Legal Information Institute                      Includes information on the CASRIP
http://www.law.cornell.edu/topics/topic2.ht      program, as well as a newsletter issued
ml#intellectual%20property                       three times a year that reports on CASRIP
Includes brief summaries of IPR law topics       research and other IP-related activities and
with links to key primary source material,       highlights IP developments around the
other Internet resources, and useful off net     world.
references.
                                                 Other
Franklin Pierce Law Center
e IP Mall                                       Copyright Clearance Center
http://www.ipmall.fplc.edu/                      222 Rosewood Drive
Provides information and links to IP             Danvers, Massachusetts 01923 U.S.A.
resources worldwide, including daily             Tel: 978-750-8400
news, the Congressional Research Service,        Fax: 978-646-8600
publications, and papers.                        E-mail: info@copyright.com
                                                 http://www.copyright.com/
Stanford University                              Web site of an intermediary between
Copyright and Fair Use                           copyright holders and content users. It
http://fairuse.stanford.edu                      facilitates the exchange of reuse rights and
Includes such primary materials as               royalties through a wide range of licensing
statutes, judicial opinions, and treaties and    services that grant permission to reproduce
conventions; current legislation; and an         copyrighted materials.
overview of copyright law.
                                                 Digital Future Coalition
Stanford University                              1341 G Street, N.W.
Copyright and Intellectual Property              Suite 200
http://palimpsest.stanford.edu/bytopic/          Washington, D.C. 20005 U.S.A.
intprop                                          Tel: 202-628-9210
Includes a menu of source materials on U.S.      E-mail: dfc@dfc.org
copyright law.                                   http://www.dfc.org
                                                 e Digital Future Coalition (DFC) is
University of California, Los Angeles            a collaboration among U.S. profit and
e UCLA Online Institute for Cyberspace          nonprofit groups that deal with IPR. It
Law and Policy                                   is committed to striking an appropriate
http://www.gseis.ucla.edu/iclp/hp.html           balance in law and public policy between
is electronic archive offers a cyperspace       protecting IP and affording public access
law bibliography, as well as information         to it.
going back 10 years, including cases
involving cyberspace law.

                                                                                             103
                   Additional Readings on
                    Intellectual Property
Alikhan, Shahid and Raghunath Mashelkar        Glick, Mark A., Lara A. Reymann, and
Intellectual Property and Competitive          Richard Hoff mann
Strategies in the 21st Century                 Intellectual Property Damages: Guidelines
e Hague; New York: Kluwer Law                 and Analysis
International, 2004.                           Hoboken, New Jersey: John Wiley, 2003.

Anderson, Robert D. (ed)                       Goldstein, Paul
Competition Policy and Intellectual Property   Copyright's Highway: From Gutenberg to
Rights in the Knowledge-Based Economy          the Celestial Jukebox
Calgary, Alberta, Canada: University of        Stanford, California: Stanford University,
Calgary Press, 1998.                           2003.

Callan, Bénédicte                              Granstrand, Ove (ed)
Pirates on the High Seas: e United States     Economics, Law, and Intellectual Property:
and Global Intellectual Property Rights        Seeking Strategies for Research and Teaching
New York: Council on Foreign Relations,        in a Developing Field
Inc., 1998.                                    Boston, Massachusetts : Kluwer Academic,
                                               2003.
Cook, Curtis W.
Patents, Profits and Power: How Intellectual   Halbert, Debora J.
Property Rules the Global Economy              Resisting Intellectual Property Law
London: Kogan Page, 2002.                      New York: Routledge, 2005.

e Digital Dilemma: Intellectual Property      Harris, Lesley Ellen
in the Information Age                         Digital Property
Committee on Intellectual Property             Ontario, Canada: McGraw-Hill Ryerson
Rights and the Emerging Information            Ltd., 1998.
Infrastructure. Washington, D.C.: National
Academy, 2000.                                 Hawke, Constance S.
                                               Computer and Internet Use on Campus:
Elias, Stephen and Richard Stim                A Legal Guide to Issues of Intellectual
Patent, Copyright, and Trademark               Property, Free Speech, and Privacy
Berkeley, California: Nolo Press, 2003.        San Francisco, California: Jossey-Bass, 2001.

Field, omas G.                                Herrington, Wayne W. and George W.
Introduction to Intellectual Property: Cases   ompson
and Materials                                  Intellectual Property Rights and
Durham, North Carolina: Carolina               United States International Trade Laws
Academic, 2003.                                Dobbs Ferry, New York: Oceana, 2002.




104
Hurley, Deborah and Hal Varian (eds)            Matsuura, Jeff rey H.
Internet Publishing and Beyond: e              Managing Intellectual Assets in
Economics of Digital Information and            the Digital Age
Intellectual Property                           Boston, Massachusettts: Artech House,
(publication of the Harvard Information         2003.
Infrastructure Project)
Cambridge, Massachusetts: MIT Press,            Matthews, Duncan
1998.                                           Globalising Intellectual Property Rights:
                                                e TRIPs Agreement
Idris, Kamil                                    London and New York: Routledge, 2002.
Intellectual Property: A Power Tool for
Economic Growth                                 McCarthy, J. omas, Roger E. Schechter,
Geneva, Switzerland: World Intellectual         and David J. Franklyn
Property Organization, 2002.                    McCarthy’s Desk Encyclopedia of
                                                Intellectual Property
King, J. Ralph, Andrew D. Dorisio, and          3rd ed. Washington, D.C.: e Bureau of
Michael S. Hargis                               National Affairs, 2004.
Intellectual Property
3rd ed. Lexington, Kentucky: University         McManis, Charles R.
of Kentucky, College of Law, Office of          Intellectual Property and Unfair
Continuing Legal Education, 2002.               Competition in a Nutshell
                                                5th ed. St. Paul, Minnesota: omson/West,
Koepsell, David R.                              2004.
e Ontology of Cyberspace: Philosophy,
Law, and the Future of Intellectual Property    Merges, Robert P., Peter S. Menell,
Chicago, Illinois: One Court, 2000.             and Mark A. Lemley
                                                Intellectual Property in the New
Landes, William M. and Richard A. Posner        Technological Age
e Economic Structure of Intellectual           3rd ed. New York: Aspen, 2003.
Property Law
Cambridge, Massachusetts: Belknap Press of      Moore, Adam D.
Harvard University, 2003.                       Intellectual Property and Information
                                                Control: Philosophic Foundations and
Lessig, Lawrence                                Contemporary Issues
Free Culture: How Big Media Uses                New Brunswick, New Jersey: Transaction,
Technology and the Law to Lock Down             2004.
Culture and Control Creativity
New York: Penguin, 2004.                        Nimmer, Melville B. et al.
                                                Cases and Materials on Copyright
Letterman, G. Gregory                           5th ed. New York: Matthew Bender &
Basics of International Intellectual Property   Company, 1998.
Ardsley, New York: Transnational, 2001.
                                                O'Connor, Edward F.
Lindsey, Marc                                   Intellectual Property Law and Litigation
Copyright Law on Campus                         2nd ed. Chicago, IL: Tort Trial and
Pullman, Washington: Washington State           Insurance Practice Section, American Bar
University, 2003.                               Association, 2003.

Marlin-Bennett, Renee
Knowledge Power: Intellectual Property,
Information, and Privacy
Boulder, Colorado: Lynne Rienner, 2004.

                                                                                            105
Peloso, Jennifer (ed)                             Sell, Susan K.
Intellectual Property                             Private Power, Public Law: e Globalization
New York: H.W. Wilson, 2003.                      of Intellectual Property Rights
                                                  Cambridge, United Kingdom; New York:
Perelman, Michael                                 Cambridge University, 2003.
Steal is Idea: Intellectual Property Rights
and the Corporate Confiscation of Creativity      ierer, Adam and Wayne Crews (eds)
New York: Palgrave, 2002.                         Copy Fights: e Future of Intellectual
                                                  Property in the Information Age
Poltorak, Alexander and Paul Lerner               Washington, D.C.: Cato Institute, 2002.
Essentials of Intellectual Property
New York: John Wiley and Sons, 2002.              United Nations Educational, Scientific,
                                                  and Cultural Organization
Poynder, Richard (ed)                             Copyright Laws and Treaties of the World
Caught in a Web: Intellectual Property            Looseleaf volume with supplements.
in Cyberspace                                     Washington, D.C.: Bureau of National
London; Washington, D.C.: Denwent/                Affairs, 1956- .
omson Scientific, 2001.
                                                  U.S. General Accounting Office
Rahnasto, Ilkka                                   Intellectual Property: Deposits of Biological
Intellectual Property Rights, External Effects,   Materials in Support of Certain Patent
and Anti-Trust Law: Leveraging IPRs in the        Applications
Communications Industry                           Washington, D.C.: GAO, 2000.
Oxford; New York: Oxford University, 2003.
                                                  Wilson, Lee
Razgaitis, Richard                                e Trademark Guide
Valuation and Pricing of Technology-Based         New York: Allworth Press, 1998.
Intellectual Property
New York: John Wiley and Sons, 2003.              Winner, Ellen P. and Aaron W. Denberg
                                                  (eds)
Ryan, Michael P.                                  International Trademark Treaties With
Knowledge Diplomacy: Global Competition           Commentary
and the Politics of Intellectual Property         Dobbs Ferry, New York: Oceana, 2004.
Washington, D.C.: e Brookings
Institution, 1998.

Saint-Amour, Paul K.
e Copyrights: Intellectual Property and
the Literary Imagination
Ithaca, New York: Cornell, 2003.

Schechter, Roger E. and John R. omas
Intellectual Property: e Law of Copyrights,
Patents and Trademarks
St. Paul, Minnesota: omson/West, 2003.




106
                           KIDS’ CORNER:
        Educational Materials for Children
               and Young Adults
Cybercitizenship.org: Just for Kids            FA©E
http://www.cybercitizenship.org/index.html     http://www.copyrightkids.org
http://www.cybercitizenship.org/4kids/         Friends of Active Copyright Education
4kids.html                                     (FA©E) is a new initiative of the Copyright
The Cybercitizen Partnership Awareness         Society of the U.S.A. designed to provide
Campaign offers approaches for teaching        a broad range of resources to foster and
children about cyberethics, cybercrime         support copyright education.
information, and links to adult and            A FA©E subcommittee developed the
youth resources.                               copyrightkids.org web site to teach school-
                                               age children the basics of copyright law.
Cyberethics for Kids
http://www.cybercrime.gov/rules/               Learn From the Past, Create the Future:
kidinternet.htm                                Inventions and Patents
U.S. Department of Justice offers teachers a   http://wipo.int/freepublications/en/patents/
lesson plan outline and exercises for K-8.     925/wipo_pub_925.pdf
                                               is new on-line publication on intellectual
CyberPilot’s License                           property is the first of a new series of free
http://etec.hawaii.edu/cpl/home.html           offerings by WIPO aimed at schoolchildren
The CyberPilot’s License is dedicated          (ages 8-14) as the creators of the future.
to the study of web ethics and the
development of healthy on-line learning        MENC/ASCAP Foundation
environments. Students, teachers, parents,     http://www.musicunited.org/10_
and policymakers are welcome to join           education.html
the discussion forums, examine on-line         MENC: The National Association for
resources, and help create an archive of       Music Education, with support from the
educational materials.                         ASCAP Foundation, has developed a school
                                               curriculum that teaches students at all
CyberSpacers                                   levels about the creative community and
http://www.cyberspacers.com/                   copyright. The program is offered not only
This site provides activities for kids:        by grade level but also by teacher’s class
the CyberSpacers’ oath; join the Super         subject specialty, i.e. History, Government
Cyber Team; and learn about cybercrime         Affairs, English, etc.
through on-line quizzes, comics, games
and contests.                                  Netmonkey
                                               http://www.netmonkey.info/
                                               Convicted copyright pirate Mike Nguyen
                                               has created a site to educate young people
                                               about the risks of on-line piracy. This site
                                               contains a downloadable copy of “Net
                                               Monkey Weekly,” an entertaining and
                                               informative newsletter directed at children,
                                               which addresses the ills of piracy.


                                                                                         107
Parade Classroom                                     Pro Music
http://www.paradeclassroom.com/tg_                   http://www.pro-music.org/
folders/2003/1026/1026_info.html                     Pro Music is an international web site that
Parade Classroom, a web site for professional        supports legitimate on-line services.
educators, offers a Teacher’s Guide titled           It provides information about copyright
“The Music Swapping Crackdown.” The                  laws and presents artists speaking out
guide encourages students to research the            against piracy.
issue and decide what’s right and wrong.
                                                     What’s e Download?
Play It Cybersafe                                    http://www.whatsthedownload.com/
http://www.playitcybersafe.com/                      A comprehensive public education
This web site provides children, parents,            campaign created by the Recording
and teachers the opportunity to prevent              Academy that strives to empower
cybercrime through knowledge of the law,             consumers to make informed ethical
knowledge of their rights, and the ability to        and legal decisions when getting their
avoid misuse on the Internet. The Business           music through digital technology, while
Software Alliance and the Hamilton                   understanding the part they play in the
Fish Institute at the George Washington              future of music.
University created this site. It is a Cyber
Crime and Intellectual Property Theft
Prevention and Education Project funded by
the U.S. Department of Justice to educate
the public on cybercrime and intellectual
property theft.




The U.S. Department of State assumes no responsibility for the content and availability of
the resources from other agencies and organizations listed above, in “Sources of Information
on Intellectual Property,” and in “Additional Readings on Intellectual Property.”
All Internet links were active as of Fall 2005.


108
                                                                                       U. S. DEPARTMENT OF STATE
                                                                      Bureau of International Information Programs
                                                                                                                   2006
                                                                                                http://usinfo.state.gov/




CREDITS:
(Credits from left to right are separated by semicolons, from top to bottom by dashes.)
Cover Montage: Counter clockwise from                     Simon Kwong/Reuters. 41: AP/Wide World Photo
top: National Museum of American History,                 – Getty Images (RF). 43-47: AP/Wide World
Transportation Archives, Smithsonian Institution –        Photo (8). 51: © Monika Graff/The Image Works
AP/Wide World Photo; PhotoSpin – PictureQuest             – David McNew/Getty Images. 52- 61: AP/Wide
(RF) – AP/Wide World Photo (2) – PhotoSpin                World Photo (8). 63: AP/Wide World Photo; David
– AP/Wide World Photo (2).                                McNew/Getty Images (2). 65: top left Frederic
Page 3: University of Missouri-Kansas City, Miller        J. Brown/AFP/Getty Images; AP/Wide World
Nichols Library, Special Collections, Popular             Photo (4). 67: AP/Wide World Photo – Pornchai
American Sheet Music; Geoff Brightling/Getty              Kittywongsakul/Getty Images. 71: AP/Wide
Images. 5: AP/Wide World Photo (4) except                 World Photo – AFP/AFP/Getty Images; David
bottom left Milos Bicanski/Getty Images.                  Silverman/Getty Images. 72: AP/Wide World
6: AP/Wide World Photo (2). 7,8: AP/Wide World            Photo (3), bottom left Sergei Guneyev/Time Life
Photo (3). 11: Library of Congress (2) – AP/Wide          Pictures/Getty Images. 75: AP/Wide World Photo
World Photo. 13: © SSPL/The Image Works; AP/              (2). 76: AP/Wide World Photo (2); top right Francis
Wide World Photo – © Science Museum/SSPL/                 Dean/The Image Works. 79: Reuters – AP/Wide
The Image Works; AP/Wide World Photo.                     World Photo (3). 80-83: AP/Wide World Photo (5).
14: AP/Wide World Photo (3) – Creatas Images              85: Anna Wang/MMV.org; AP/Wide World Photo
(RF)/PictureQuest; © Peter Hvizdak/The Image              – © SSPL/The Image Works. 87: Tannen Maurey/
Works. 17: Courtesy WIPO.int. 19: NRM/SSPL/The            The Image Works – AP/Wide World Photo; ©
Image Works; © Science Museum, London/                    Francis Dean/The Image Works. 88: Courtesies
Topham/The Image Works – © SSPL/The Image                 ebay.com; yahoo.com; sell.com. 89: Courtesies
Works. 21: © Topham/The Image Works – AP/                 ioffer.com; whois.com.
Wide World Photo. 22: AP/Wide World Photo
– Alessia Pierdomenico/Reuters – © 2002 Richard
Lord /The Image Works; AP/Wide World Photo.
24: AP/Wide World Photo (3). 27: AP/Wide World
Photo – Courtesy www.training.ipr.gov.
29: Reuters. 33: Reuben Sprich/Reuters – Finbarr          Executive Editor: George Clack
O’Reilly/Reuters; AP/Wide World Photo.                    Managing Editor: Mildred Solá Neely
34: AP/Wide World Photo (3). 37: Reuters;                 Art Director/Design: Min-Chih Yao
AP/Wide World Photo. 38: Kenny Wu/Reuters;                Photo Research: Maggie Johnson Sliker
        U. S. DEPARTMENT OF STATE
Bureau of International Information Programs
             http://usinfo.state.gov/
FOCUS ON: INTELLECTUAL PROPERTY RIGHTS
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