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Intellectual Property Protection

in a

Global Economy

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What is Intellectual Property?

• 1. Literary, artistic and scientific works; • 2. Performances of performing artists,

phonograms, and broadcasts; • 3. Inventions in all fields of human endeavor;• 4. Scientific discoveries;• 5. Industrial designs; • 6. Marks and commercial names;• 7. Protection against unfair competition;• 8. All other rights resulting from intellectual

activities in the industrial scientific literary and artistic filed.

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Patent

• A patent is an exclusive right granted for an invention to the inventor

• A patent provides protection to an individual for the invention for a limited period, generally 20 years form the filing date, in the country or countries in which it is patented, in exchange for the inventor’s public disclosure of the invention.

• A patent owner has the right to decide who may or may not use the patented invention, and may give permission (license) to others to use the invention on mutually agreed terms.

• The patent owner may also sell the right to the invention to someone else, who will then become the new owner of the patent. Once the patent expires, the protection ends, and the invention may be used by anyone.

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Trademarks

• A trademark or “mark” is a distinctive name, logo, or sign identifying the source of goods or services. Trademarks help consumers distinguish a product or service from one source form those produced by another source.

• A mark provides protection to its owner by preventing confusion as to source in connection with the distribution of goods or services or licensing others to use them.

• The period of protection varies, but a mark can remain valid indefinitely through continued commercial use or a registration and renewal process.

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Copyright

• Copyrights consist of a bundle of rights given to creators for their literary and artistic works. These creators, and their heirs, hold the exclusive rights to use or license to others to use the work on agreed terms.

• Copyright applies to many different types of artistic works, including paintings, music, poems, plays, books, architecture, and choreography, as well as to works that are generally not considered artistic such as computer software, maps and technical drawings.

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Copyright, cont.

• The creator of a work can prohibit or authorize, for example: – its reproduction in various forms, such as a printed

publication or a phonorecord; – its public performance, as in a play or musical work; – its broadcasting, including by radio, television, or

satellite; – its translation into other languages, or its adaptation,

such as the adaptation of a novel into a screenplay

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Trade Secret

• No registered protection, but internal agreements binding on employees who need to know, not to divulge the secret.

• The definition of the secret is usually deposited in an escrow account.

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The most commonly applied for patents are in the areas of

• Information and communication technologies,

• biomedical research and development of new drugs,

• digital technology,

• high performance materials,

• artificial intelligence, and

• virtual marketing in cyberspace.

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Sector App. No.of

Utility Patents per Year

1982 1996

% Growth

Advanced Materials

250 1,200 333 %

Information Technology

4,000 16,000 305 %

Health 2,000 4,700 189 %

Automotive 1,300 2,700 105 %

All US Patents 58,000 111,000 89%

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The adaptation of IP protection of biotechnology posed many profound

challenges

• In the special case of biotechnology, the advent of new tools for research in genetic engineering has had a strong impact on agricultural and biotechnical research programs.

• Biotechnology, however, is increasingly private-sector driven and increasingly relies on IP.

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Cyberspace

• Combined application of computer and telecommunication technologies, as reflected by the Internet, poses problems for IP regimes.

• With a few key strokes one can anonymously download copyrighted material form numerous websites around the world.

• The scope and extent of liabilities between providers of information on the Internet and content right holders need to be better understood.

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WTOWorld Trade Organization

• An international body dealing with the rules of trade between nations. At its heart are agreements negotiated and signed by the bulk of the world’s trading nations. These documents provide the legal ground for international commerce.

• The three main purposes of the WTO are – to help trade flow as freely as possible, – to serve as a forum for trade negotiations, and – to provide settlement of disputes.

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• In the 1990’s, the rapid expansion of a new global trading regime following the establishment of the World Trade Organization (WTO) triggered an increasing demand for IP protection, especially in the high technology and other knowledge-intense industry sectors.

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Trade-Related aspects of Intellectual Property (TRIPS)

• The relationship between international economic activities and IP for developing countries is the subject matter the

TRIPS AGREEMENT

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• In the 1990’s an increasing number of policy-makers in countries with emerging economies recognized the role of the IP system as an important element of the institutional infrastructure for encouraging private investment in R&D, especially in the industrial and scientific fields

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Foreign Direct Investment (FID)

• Studies concerning the link between stronger IP protection and import/export including technology transfer show that if a country offers strong protection of any IP, IP owners are more willing to export or transfer technology abroad.

• One number that is particularly striking even to the non-technical community is the losses that the U.S. incurs due to piracy of entertainment works: – For copyrighted entertainment works alone, estimated of

losses to US Industries from piracy total approximately 18-22 Billion Dollars/Year! (www.IIPA.com; also Eric Smith, President of Int’l. Intel. Property Alliance (Jan 1, 1999)

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IP VALUE

Assets of Fortune 100 Companies:

1982 -- IP Value amounted to 30%2000 -- IP Value 70%

General Corp Assets:1982 -- 62 % physical assets, 2000 -- 30% physical assets.

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History of IP

1473 Venetian Law recognized individual’s rights to their creations

1700 Catholic Church in England/ France monopoliesed the printing press to such an extent that in 1700 The Statute of Anne was enacted which diminishes the control over publishers/ printers and gave individual author rights. Specifically, the author was given 14 years after publication to do with his/her works whatever he/she wanted.

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History, cont.

1790 First US Patent Act: “An act to promote the Progress of Useful Arts”

1791 Age of Enlightenment brought many inventions along and several laws were enacted :

France enacted its FIRST Patent Law

In many countries, these new rights to inventors followed on the footsteps of Declarations of Rights of Man and of Citizens, such as in France after the French Revolution

1793 The 1790 act was replaced, subject entitled to protection was redefined

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History, cont.

1883 Paris Convention for the protection of IP:

Invention date of a patent filed in one country is recognized in all member countries for up to one year;

Right to protection are upheld in all member countries.

1886 Bern Convention

for protection of Literary and Artistic Works (copyright)

For length of “life of author plus 50 years”;

1887 US joins Paris Convention

1930 Plant Patent Act:

Protection for sexually reproduced plants

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History, cont.

1967

1970

World Intellectual Property Organization (WIPO) was formed

Patent Cooperation Agreement (PCT)w/35 members –today over 120 Nations

1974 World Intellectual Property Organization (WIPO) became an appendage of the United Nations

1978 European Patent Office

Patent Cooperation Treaty

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History, cont.

1984 US causes inclusion of IP issues into GATT (General Agreement of Tariffs and Trade Agreement)

1994 GATT now includes an agreement on Trade Related Aspects of Intellectual Property Rights (TRIPPS)

(= a minimum standards for patent protection must be upheld)

WTO Agreement

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Examples

• Product knock-off– TM violations

(mostly jeans, watches, handbags, glasses)

– Patent violations (mostly high ticket industrial items, methods,

drugs)

– Copyright violations (mostly videos, DVDs, CDs,

downloading)

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US Pharma

employs 400,000 directly

creates 2.7 Mill jobs

contributes $172 Bill to US economy

Investments2003 US Pharma invested $33.2 Bill in research

NIH spent $30 Bill

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Pirated & Counterfeited Goods

• Software codes• Chemical processes• Car designs• Digital files

90%of all software on Chinese computers is pirated and bought openly in stores for $3/copy

Response: Raids of shops, fines $6,900

($132 per offender)