KOL409 | IP Law Tutorial, Part 1: Patent Law

okay so um if everyone can just keep their microphones on mute until until you need to ask a question

or until the Q a session and by the way everyone’s free feel free to interrupt me as I’m speaking but what I plan to do

is speak for a while maybe 30 40 15 minutes however long it takes to do the first part and then we can open

the floor up to any kind of questions um as I explained in the Twitter message

and the Facebook post about this um it occurred to me you know I’ve given lots of talks over the years on on

patent and copyright law intellectual property law why it should be abolished why it’s unlibertarian uh those things

hundreds of talks probably um I’ve only given a few talks in my life early in my patent law career to

other lawyers mostly about patent law itself um that is you know to business people

or to pet lawyers um and never I think never to to Libertarians and it occurs to it

occurred to me the other day that it would be good for me to do this because lots of times there’s lots of confusion

over the way patent and copyright law work um and you know you really need to have

some idea of how it works to have a good understanding of what’s wrong with it right and to criticize it and understand the right solution

um so this is the talk not really for business people but if anyone wants to use it practically that’s fine with me

but what I intend to do is talk about um um patent law today and if this goes

well and people are interested we can do a second session on copyright law and then maybe other sessions on other things but the but uh let me just get

started now before I get started does anyone anyone have any questions is there any problem with hearing me or

seeing what I’m doing okay

all right so as I said um I’m gonna slide on page two of my slides slide two uh and uh I’m gonna

give um an overview so intellectual property law is is a is a subset of law

that’s the laws the state’s enforced in different countries in the world and there are different types of

different types of Ip law hold on a second like gray again okay

um the the big two types of Ip law would be patent law and copyright law okay but

there are others too uh and let me briefly explain something most of you know me from libertarian or Austrian

circles um as a Libertarian writer and thinker um I have been I’ve been a practicing

attorney since 1992 and a patent lawyer since 93 and a registered patent attorney since

um since 1994. so I’ve been doing patent law hardcore in my career as a lawyer uh

for almost 30 years about 30 years now and I’ve done hundreds of patent applications for High-Tech companies

like Intel and um my last employer applied up to electronics and physics

and Laser patents uh all kinds of things like that so I have a lot of experience with patent law and also other types of

Ip law like copyright and trademark to a lesser degree but um that’s my sort of

practice and I’ve written and spoken on those topics as well but I’ve written and spoken mainly on libertarian issues

and libertarian aspects of this so that’s sort of how most of you know me um in any case

um in fact uh practicing patent law was one reason I started investigating the morality as a Libertarian of patent law

because I was practicing in that field and I started wondering how the hell can this weird thing be justified and I try

to do it and I failed and I I failed because it’s not justifiable I finally realized that

and when I realized that then I started writing around the same time that I passed the patent bar I started writing

on patent law from a Libertarian point of view so they could they kind of go together but I kind of want to focus

today on the Practical aspects and the real the real world aspects of patent law okay so now

IP intellectual property is a term that is fairly new people came up with it in

the late mid-1800s in response to criticism of patented copyrights which were viewed as Monopoly privileges

granted by the state and the free market Economist in the 1800s started criticizing it because it’s contrary to

free trade and they started realizing this and countries started abolishing their patent law and they started

thinking what the hell are we doing and uh and then in response the entrenched Industries uh came up with the defense

because they wanted to keep copyright and patent alive because they were making money off of it and they called it um

um they said it’s not a monopoly privilege about the state it’s it’s a property right it’s an intellectual property

right it’s a special type of property right okay so at this point in time there are different in most countries they have different

subsets of Ip law and they all they all work differently so the big two are

copyright and patent and in America those are federal that’s that’s a national law uh the state laws have been

preempted because the Constitution grants Congress the power to do this uh trademark law is another type of IP law

and again I’m going to get in the patent today I’m just going through a quick overview trademark is still State based

but with some federal aspect in the US and trade secret is mostly state-based um going to the next slide now

um sure go ahead

um on the very top of your of your screen you can put swap displays because we’re looking at uh we’re not looking at

the PowerPoint percent we’re looking foreign

see what I’m saying explain say again on the very top it says Swap this place

on your on your side if you click in there we’re gonna be we’re gonna look at the PowerPoint fully I don’t know if

that makes sense do you see on top I think the problem maybe I have I may have too many um

displays open let me let me close all my displays and oh swap displays okay I see it now

um how about that perfect much better all right great okay then let me go up

okay so this was the first slide uh well here’s the first the cover page uh slide

number two overview and now the slide that we’re on okay so

in addition to patent and copyright which are the kind of primary types of trademark of a pat of intellectual

property sorry uh trade trademark and trade secret are the other two but there

are other types too there are special laws like uh boat hole designs and semiconductor Mass squirt protection

both american-based um but probably bullet holes somewhat someone wanted to get protection of their boat so they got

that inserted into the Copyright Act and then semiconductors because of Texas Instruments and Intel and companies like

that uh in some countries there are database rights and in some countries there are moral rights which is sort of

the right this this inalienable right to to be recognized forever as the creator of the work and also to prevent the the

owner of the work from destroying it uh like you know if you have a mural painted on your refrigerator you can’t

sell your refrigerator or destroy it it’s crazy and then there are sort of special things that are not regarded as

IP but they work the same way like you know it’s illegal to use the NSA seal in America there’s some special statute

that’s basically IP and then of course as we all know if you paint certain religious figures pictures on the cover

of a magazine you might get killed that’s kind of a type of privately enforced IP

um and then there’s always there’s proposed rights like all these things uh burbling up through the con Congress

right now about forcing people to pay forcing internet providers to pay and

you know Google searches and things like that pay newspapers for using their headlines and their articles

um or there’s always agitation to add fashion designs as part of copyright or patent and then now there’s talk about

um this new artificial intelligence how they you know the AI engines like chat gbt and the other ones they they they

scour the internet for a date for images and for text to to build their uh their

their models and you know that’s that’s the type of copying and then when they produce an output that could be argued

to be a copyright infringement to like a derivative work so there’s all kinds of applications of this kind of broad idea

of intellectual property um and I have talked I have spoken about

this a little bit not about how it works but about the types of Ip and a couple of Publications like my against

intellectual property in the first section I think I call summary of Ip law I kind of try to summarize these things

and then I I did a talk about 20 something years ago now um for oil and gas lawyers when I was

doing that as a as a practice but I was explaining patent and copyright law and IP law to them that’s an old talk but

copyright law and IP Law changes slowly so that’s still pretty pretty up to date

um if anyone anyone wants to look into it and then there’s all kinds of guides on the internet like you know these IP

law for dummies and and things like that uh but I’m gonna try to go through that

here okay let me go through the history briefly of patents so the patent system is one of the the the four main types of

Ip and it’s one of the two big important types copyright being the other patents have to do with inventions copyright has

to do with artistic and creative works um the expression of ideas is what copyright covers patents cover the

functionality of a process or a composition of matter which is a pharmaceutical or a drug or a machine an

apparatus usually a machine sometimes a process um now these originated in Europe and

sort of the first modern incarnation of this was in 1623 in England when the the

parliament got fed up with the abuses of the of the crown the king in granting

patents to court cronies which were exclusive rights to do something okay so

patent just means it’s a Latin word patente means open so letter patent was an open letter so it was basically the

king writing down on a piece of paper Mr X has the stole exclusive right to

sell this product in this region something like that or to do this so it was it was like an exclusive anti-p you

know anti-competitive protectionist grant that protected the person because he could show the letter to people say

listen if you if you sell playing cards in this town I I have the right to do it

because of the king because this letter patent um you’re violating the King’s Command it’s illegal you’re gonna you know

you’re gonna be arrested or penalized um so that practice got out of hand because

the Kings would Grant these things out left and right to court favorites and often in exchange for favors so they

would say okay you’re going to go to this new territory of the crown and we’re going to give you the exclusive

right to sell sheepskin um and you can make a lot of money because no one can compete with you but

in exchange we want you to help us collect taxes from everyone okay so it was a way of buying buying loyalty and

buying um favors from from the the people lower than you in the hierarchy uh well this

practice got out of hand and so Parliament reigned it in in 1623 with what they call the statute of monopolies

because these things were seen these letters patent were seen as um grants of Monopoly privilege

and other monopolies so the statute of monopolies said look the king cannot do

this anymore however we’re going to let him keep doing it for inventions so you can still keep granting a letter patent to someone

if you think they’ve come up with some new invention some practical process or device or Gizmo

um and so the king kept granting patents on occasion for for inventions so that’s how and nowadays we think of patents as

patents for inventions that’s because that’s the only thing that remained after the statute of Monopoly is the 1623. now still it was a it was it was

sort of a discretionary power of the crown it wasn’t really a bureaucracy there was no institutionalized patent

application system you would just go to the Kings you know um secretaries or whoever and say look can you please ask

the king if he would give me a patent on this invention and sometimes you get it sometimes you didn’t later on the

process became institutionalized and democratized with the first general patent act uh being enacted by the The

Colony at that time of South Carolina in America in 16 in 1691.

um and then the next one I guess the video of note would be after the United States

uh after the United States was uh was founded in 1770 well you could say 1776

1785 when we when we won the uh uh the Revolutionary War the war for

Independence against Britain and then um and then in 1789 the Constitution was

ratified and as I have here on slide page number four the uh article one

section 8 Clause 8 of The Constitution which is what grants Congress The Limited and enumerated powers that they

have it says power Congress has the power to promote the progress the science and the useful Arts by securing

to limited times for limited times that’s why patent and copyright don’t last forever they have to last for a

limited finite time to authors and inventors the exclusive right to their writings and discoveries okay and by the

way as a matter of historical curiosity um the word science in the Arts was used

in a sort of Way backwards to the way that we use them now in the Clause there you’ll see how science is listed first

and goes with authors and writings Arts goes with inventors and discoveries and

that’s because the word Sciences part means knowledge right that’s why you know you have a

conscience it’s kind of science uh science means the um um the R means knowledge and that

referred basically basically to writings and useful Arts meant inventions because

Arts are things that come from Artisans or you know practical makers of plows and and tools and devices so Arts meant

inventions and science meant excuse me science Med uh writings are

knowledge uh in any case so the Clause of the Constitution ratified in 1789

gave congress the authority to pass patent and copyright law not the obligation but just the right the the

power and so it’s in 1790 one year later Congress sure enough went ahead and enacted the first patent Act and the

first Copyright Act and these were General the patent act in the US was a general act it was like a bureaucracy I

think Thomas Jefferson was one of the first Commissioners even though he opposed patents oddly in some way he was

still the first commissioner because he actually knew something about invention um so that’s and then other countries of

the world in Europe started the following suit in the 1800s soon after that and patent law started becoming a

thing um and now it’s a big thing um okay I’m on Slide Five now what patents are

so uh I don’t know how I can do this um

let me try the I want to give an example of a patent the way it happens is you get a patent attorney or a patent agent

and a patent agent or patent attorney is is either in engineer or or an engineer with a law degree who

has taken the patent bar exam and passed it if you’re just an engineer you’re a patent agent and if you’re a patent if

you’re an attorney you’re a patent attorney and both both are qualified to file applications to the patent office

um uh and I want to show an example of this because when I started practicing I was

totally confused because I only had one guy that was teaching me and he wasn’t a good teacher

um let me see here uh

I’m gonna pull up an example here so

now let me share my screen

okay can everyone see this patent application

that I’m looking at right now or do I need to swap screening again or something it’s all clear

you can see it right now yes okay I am on I’m on the top right now

I’m on page the very the very front page can everyone see this the title says Optical

component holder anyone

no we’re looking at something that says IP treaties oh hold on the web browser

how about now what about now now we can see it okay so this is um this is a

patent application I drafted a few years ago so it’s just a word document and you

you file it and you write it a certain way and so it’s got it starts with a title you list the inventors you explain

the technical field and then the background is like what’s going before so you set the stage and then you have drawings which I’ll

show in a second and you have a description of the drawings then you have What’s called the detail description and that’s like required by

patent law in patent law it’s called the patent bargain the bargain is the government is going to Grant you a

limited Monopoly on the exclusive right to make use or sell or import this claimed invention

for 20 years from the filing date which means about 17 or 18 years in

practice because it takes about two or three years to get it issued from the date you file it so if you file it on day one you take

two years to issue it then you have 18 years from the data filing left so you have an 18-year patent term so it’s

about a 17 18 year patent term typically it used to be 17 by Statute but they changed it

uh years under Obama uh in any case so the bargain is we’re going to give you

this exclusive right in exchange for you disclosing to the world everything you know so that by the time it comes into

the public domain in 18 years everyone knows what it is and they know how to compete with you and they know how to

build on it and all that so that that’s the patent bargain that’s why you have to have a written description which

number one has a written description of the invention number two has drawings which which Illustrated and number three

uh which enables someone’s skilled in the art to basically to do what you’re

you’re claiming to make to make a copy of it eventually so the detail description starts here and you refer to

the figures figure seven whatever with reference numerals so I’m just scrolling through the Pat this is so this is what

you write okay this way you send into the patent office okay and then

um you have some drawings I’m on the figures now here and the drawings are figure one whatever and then with

reference numerals pointing to different things so you can refer to them in the description uh and then you terminate

the patent with a set of claims now this is what you’re claiming is the unique

part that you you should get a property right in this is sort of like the meets and Bounds of your patents so the claims

start with a claim one and they start with the word a or they always um um air uh or n it’s like a a process a

machine a device for whatever comprising comprising means including and then you

list the elements of the of of of the essential nature of the invention so this is an optical component holder

comprising element a element B element C are limited they call these limitations too

in any case that’s what you get a pro so if the examiner agrees with you that there’s nothing similar out there in the

in the prior art then he’ll Grant you a patent and that looks like um

this let me find that oh by the way so when you when you

practice when you file the patent the patent office keeps a record and then going back and forth to the patent

examiner is called for some reason I don’t know why it’s called prosecution probably just to confuse Layman uh it’s

not like a criminal case but it’s called prosecution you’re Prosecuting the bad and you’re trying to get it issued and

it’s it’s called uh it’s not adverse like third parties are not part of this this is all secret it’s only between the

patent attorney of the uh of the inventor or his court or his company’s lawyer and the patent office so it’s

like a one-way proceeding so there’s all these obligations to be ethical and to be disclose everything so this is a

chronologic this is the patent office um prosecution history so you see it starts at the bottom like I file this on

December 6 2016 with the specification the drawings the claims in the abstract that’s all

part of the patent application as a power of attorney and then there’s all other things and then later on

um you know I get a a an office action from The Examiner he says I need you to

change this and the claims so then I’ll have an amendment you see I follow an amendment and if it satisfies Samurai

maybe I maybe I may disagree with him I may argue with him so this process goes on for a couple years you see so finally

the patent was issued uh or I got an issue a notification in August of 2018 about two years later saying okay it’s

going to issue in a couple months if you pay the fee and then that results then the issued patent which is

um here patent 10054762 so it shows kind of the

features the information I gave them in the format you know the title The the first inventor the assignee who’s the

owner uh it shows my name as the attorney

Norman kinsella uh so it’s got and then different classification fields for international filings there’s an

abstract which is like a summary and drawings and claims anyway that’s what a patent is and by the way up until I

think two days ago when the the patent office apparently switched to a paperless some kind of electronic certificate uh

Grant of patents up until two days ago um you were issued a paper copy and the

the one original copy was called the Red Ribbon copy because it actually came with a red ribbon attached to the front

cover that’s the picture of one right there so it was like a gold foil

embossed kind of seal with a red ribbon on it so that’s called a red ribbon copy oh you don’t really need that for

anything you can sue someone for patent if you can improve you have one okay let’s get back to PowerPoint

um is the Red Ribbon uh copyrighted like

the seal is it copyrighted what do you mean yeah like you mentioned that the NSA label

you can’t uh replicate that I know I don’t think no and not that I’m aware of

I mean that that might be a type of fraud or something if you did that you know in a certain in a certain way

um okay I’m back on my slideshow can

everyone see the my slideshow yes

okay now there’s something you should so when the

patent is granted then you have a property right so to speak in the in the

claimed invention and the the first thing to look at is claim one you have the sub the subsidiary claims like claim

two three four they’re called dependents so the first claim is always an independent claim it stands by itself

then you know a device that does the following claim two is usually a

dependent claim it says you know the invention of claim one having also a b and c so you add some elements and the

reason you do that is because your first claim you want to be as broad as possible but still be allowed by The

Examiner because if it’s too broad like if I just claimed um an invention period then that would not

be allowed because um it’s too broad because there’s already inventions in the world or if I

said I claim a machine there’s already machines in the world so I can’t get a patent on all the machines in the world

because they’re prior art so I have to say a machine that has the following characteristics which are new right which no one’s done before but if I add

too many features that make it new then it’s easier for someone to just like if I have 17 elements like a b c d all the

way to Decay or whatever someone can just copy my basic idea and just skip element k

and then they’re not infringing my patent so you want to have the minimum number

of elements in the first claim that lets it get allowed but in patent litigation

later it might get challenged because maybe the patent examiner who can only find so

many references with a quick search because you’re only paying a few thousand bucks to file it so that only

pays the examiner to do so much of a search but in patent litigation we’re millions of dollars on the line the

party you’re suing for patent infringement might spend a hundred thousand dollars on a search and they might uncover some things The Examiner

didn’t uncover and that might show that patent one claim one should not have been granted because it’s too broad now

so what you do is you have claims two three four five and you add other elements to the other claims to

successively narrow them down so that if in litigation claim one gets invalidated

because it was too broad you can say okay well fine claim one is too broad but claim claim three is still uh adds

adds two more elements and and the reference that you found doesn’t have those so claim three is still valid and

it’s still broad enough to cover my competitors products so that’s why people have all these claims and their patents

um it’s a strategic practice um now the claim of a patent doesn’t

give you the right to do it it gives you the right to exclude that is it gives you the right to stop people from doing

it why doesn’t it give you the right to do it um the reason is because so so let me

give an example let’s suppose everyone sits on the ground and one day I come up with a

stool now a stool is a flat seat member having at least three legs depending

from it and you can sit on it right it makes sitting easier so I I file a patent application I get a

drawing and I explain what a stool is and I get a patent I claim a seating I claim a seating uh apparatus comprising

called a stool comprising a flat a relatively flat seat member attached to

uh uh to Three Legs spaced or approximately triangularly

apart you know having a length roughly equal to the half the length of a human something

like that right you could claim a stool now some other guy decides hey this

stool would be way more useful if I put a back on it then it becomes a chair right so I take a stool and I modify the

stool and I add a chair and I patent that so you could patent the chair a pat a chair would be a stool

having a back seat member now that’s patentable because it’s new

and useful and not obvious and all these things um uh but you can’t make it because it

still will stool because it still meets the claims of the stool it still has a seat and three legs

right even if that’s four legs it still has three legs and so I might invent an

improvement on the stool called a chair but I’m unable to make it and sell it by the same token the maker of the stool is

unable to improve his stool by adding a bag to it because that would violate the chair Maker’s patent so what would

happen is quite often is this the chair patent guy and the stool patent guy would would do a license with they would

cross license to each other um but the point is just because you have a patent doesn’t give you the right to do

something it gives you the right to stop others now that can be used strategically to stop them from competing with you or to extort money

from them if you’re a patent troll which we’ll get to in a minute um

I’m on slide 7 now um now there is one thing to keep in mind I think I

mentioned this in the previous slide uh yeah they’re domestic only uh I’m back on slide six the patent patents are

domestic only now if you think about it all property rights are domestic like if you have a property right in your home

in America or in Texas then Texas law is what protects you but by its nature is a

scarce material thing it just doesn’t make any sense that it’s like it doesn’t make a difference whether that right is

National state-based or International because

if someone in China wanted to infringe my rights to my house they would have to go to Texas and try to break into my

house and they’d be covered by Texas law so it’s like there’s no difference it doesn’t make any sense to distinguish

between a property right being domestic or International because all property rights and scarce material real things

they only exist in one location at a time and the legal system that covers that covers that so they’re the same

thing in a sense no one would give a thought to it but for patents and copyrights it’s not it makes a

difference because there is no International patent or copyright system there’s only domestic law but the way

because these things don’t cover material things and they cover copying so theoretically if I have a patent on

an invention like like say the stool in America um it’s National based so no one in a in

the United States could make a stool without infringing my patent they would be violating my my property right under

U.S law but someone in Mexico or China or Russia or France who made a stool would they’re

not they’re not violating the patent right because they’re not doing it in America they would only be violating my patent

right if I filed a similar right a patent in France or China or whatever and they would be violating the Chinese

patent so when people accuse China of stealing American IP they they literally

don’t know what they’re talking about because it’s literally impossible for a Chinese company

or the Chinese government to infringe American patents by doing something in China if if apple has a patent on the on

the iPhone and if some Chinese company makes a complete pure knockoff of the iPhone in China that literally is not an

infringement of U.S patent law even by U.S patent laws terms it doesn’t purport to cover things outside the U.S

now Apple probably would have a local patent in China and the Chinese firm would be violating Chinese patents and

they have a Chinese patent system just like we have a U.S patent system everyone acts like they don’t have one but of course they do because we’ve been

successful in exporting our IP laws to other countries so they do have they will have a patent there but it wouldn’t

be violating U.S patents I think what they usually mean when they say China is stealing us IP

and say by the same thing’s true for copyright if if uh if someone is selling a CD in China which has American songs

on it it’s like it’s not a violation of U.S copyright it might be evaluation of Chinese copyright but if they don’t have

a copyright or patent system then it wouldn’t be a violation of anything uh you know there was a time in the 1800s

when some countries like Italy and the Netherlands uh abolished or never had patent rights because they thought they

were ridiculous so companies were free to Pirate other not pirate but copy other companies Pharmaceuticals without

any without violating any law any law whatsoever I think what they’re talking about is

um this remember the types of Ip include trademark patent copyright and also trade secret

um and what happens is China doesn’t have a free market

um like the US does like in the US it’s more permissionless you can just open up a company doing whatever you want you

don’t have to ask for permission but in China it’s more of a light it’s more of a socialistic bureaucratic system where

you have to get permission to do things you got to get a license from the local city or the local the local region or

the local Province and then the fat maybe the national government so there’s all these licenses and permissions you

have to get like if you want to open up a an American company wants to open up a manufacturing facility in China you got

to get all these permissions so what happened because they don’t have a free market you’ve got to get permission and

when you get permission the government can use that to extract promises from you like you got to promise to hire so

many people locally um and you have to partner with a local firm here so we can claim that we’re

promoting local business that’s called a joint venture so quite often if Apple wants to open a manufacturing facility

they have to use a local Chinese company or they have to open their own facility and partner with a local company now

that’s the price of doing business now if you don’t want to open a facility in China to save money you don’t have to but if you want to you have to do what

you have to do to get the license and that might mean partnering with some locals and when you look when you

partner with locals and you hire locals guess what’s going to happen same thing that happens in America you have employees that sometimes

steal the info you know they violate their non-disclosure agreements and their employment agreements or their

joint venture agreements and they they leak the information that’s supposed to

be proprietary this trade secret information so if Apple’s building a new iPhone you

know some employee might take a photograph of it when they’re on the assembly line and sell it to one of their buddies and then soon you have a

you have a a knockoff company making you know making a making a a version of that

of that good and that is you could say it’s a violation of trade secret law but it’s a but it’s it’s what it’s what’s

going to happen when you have employees and it’s good what’s going to happen when you have a joint venture with a

Chinese company which you agreed to do to get the benefit of doing business there it’s got nothing to do with patent

or copyright because if that design was patented under Chinese patent law then you of course Apple could sue the the

knockoff company in Chinese courts just like they can sue people in America for knockoff so this thing about China

stealing usip is complete nonsense um in any case the heart of a patent for

purposes of getting the patent is the description I mentioned earlier the detailed description the drawings and

the description explaining how it works that’s what you have to do to get the patent you got you know lower your panties and show things to the world but

the heart of the patent from a legal point of view is the claims because the claims are what your property rights are in and again as I mentioned earlier

patents are the right to exclude not the right to practice with the stool and chair example okay now on seven I’ve got

a post explain it’s just incredible all the legislation that’s out there um covering patent and IP law uh it’s

just a morass that’s why you need Specialists like me um to decipher it for you because no one

can understand or this but there are as I said patents are domestic but there are international aspects to patents but

those are primarily the following three or four treaties number one the Paris convention from 1883 so that

allows you to file in one country like in the US and then within a year

you could file um in other countries so I could file on day one in the US and say six months

later I could file a UK patent and a Chinese patent um and a Russia patent or whatever

claiming the priority date of the U.S filing and then the patent cooperation treaty which came about about a century

later in 1970 uh is more it’s like the Paris convention but it’s more unified so you could just file a PCT application

so so let’s say I file in the U.S on day one and it costs like say ten twenty

thousand dollars to pay the patent attorneys and the filing fees and all that now

let’s say a good one-third or one-fourth of the patents that you file if you’re a large company

are eventually going to be either unimportant because you don’t make the product that you were planning to make

that patent that covers or because the patent office rejects the patent and you never get it

so if you were to file a hundred or or 20 patent applications in different countries you’re talking

that ten thousand or twenty thousand dollars multiplied by you know 10 or 20 or 30 times it could be millions of

dollars to file in every so most most patents you only file them in one country or in the crucial countries like

America Europe the European patent uh treaty China maybe

um but even then what you might do is you might file one patent application in the US and then six months later you

file or three months there you file a PCT application and that gives you like two and a half years to wait to decide

whether to file another country so then you have time to to decide financially whether it’s worth it anyway it’s just a

thing people do um and then there’s the uh the trips aspects of the WTO agreement and this is

what sets down minimum standards like so if you want to be part of the WTO you’re

a patent law all those domestic it only covers your country but it has to have certain minimum standards like it can’t

be two years you need to be at least X years I don’t know if it is but most countries are about 17 18 years like I said so um you

have to have certain minimum standards um this is how the US pushes um in Western countries push our IP laws

on other countries with these agreements and also other agreements I’m going to go to the next slide now slide eight uh

like uh um bilateral investment treaties and free trade agreements we’ll sneak into

those things like oh if you want a free trade agreement with the U.S you need to expand you need to increase the length of your copyright term by 20 years to be

more like US Canada actually did that recently just hoping to join a treaty that never got never got passed

um so I call this IP imperialism and I’ve got some blog posts about that

um um Okay so

so most countries in the world including communist countries like Cuba and North Korea and China and Russia Soviet Union

they all had patent laws it’s not like a capitalist Western thing in fact I would argue IP is socialistic because it’s a

institutionalized interference with private property rights as I argue in my policy talks about why patent law should

be abolished um so I think actually IP is a socialist

policy but anyway most people view it as a capitalist Western thing because the word property is in there because of the

dishonest uh nomenclature used by the by the by the patent

um to call it IP rights so people think it’s a property rights thing so they think it’s the Western thing so they’re actually surprised when it’s it’s they

find out that Cuba and North Korea and Russia and Soviet Union uh every Vietnam

they all had they all patent law and copyright law um foreign

now as I said earlier so so to get a patent you have to give a disclosure and all

this but patents what what do they cover I already said what they are they are an exclusive right to practice and

invention but that means the subject matter of patents is inventions right so trademarks cover like trade names like

things that identify the source of goods Trade Secrets is proprietary information that’s useful to you as long as it’s

kept secretly something you keep secret copyrights have to do with um original creative works like novels

or paintings or movies or things like that um uh patents cover inventions which are

which are practical processes or apparatuses or devices that can do something useful so to get a patent you

have to satisfy say four basic criteria that’s according to the patent act in the U.S in a similar in other countries

so number one you have to have statutory subject matter which means it’s an invention so you

can’t get abstract ideas like equals mc squared or math or physics theorems even though those are useful too they’re too

they’re too much part of the universe or something like that and you can’t get a patent for for artistic works you know

that’s what copyright covers um I think there was one interesting case where someone was selling a

measuring cup where it was like a half of a cup but it

looked like a cup measuring cup and all the lines in there would say like a half

a cup halfway down but it was for a half a cup so like if you wanted to have your measurements you could just take a cup

like if the recipe said a half a cup but you want to make half the recipe you could use the half a cup cup thing and

go to half a cup if you were too stupid with with math or I don’t know um and so there was a there was the

question was well you can’t get a patent on this because it’s about it’s about a writing and that’s what copyrights cover

but I think the the court said no no this is actually functional because it helps you solve a problem anyway you

have to set your subject matter which is usually easy to satisfy um has to be useful you have utility uh

and that’s usually easy to satisfy too because most inventions uh the examiner just assumes that it works

um by the way you don’t have to make a working model anymore to you just have to file a piece of paper describing the

invention that’s called a construct active reduction to practice a reduction of practice would be actually making a

working model now the patent office used to require a working model and they still have the option to ask

you to turn one in if they’re not clear about how whether it works but I’ve never made one in my life usually you

can brainstorm with an engineer in a room a conference room in 15 minutes you could say it would be needed if you

could just move the resistor over here and that would that would make room for this and that would make a better device and you could just describe that and

file a patent on it and the day you file it with the patent office that is called constructive reduction into practice

it’s like a fiction um in any case if you file something that seems like a

perpetual motion machine like Joseph Newman did these he had some kind of idea for using magnets or something to

like magnetic particles to have a machine that can generate electricity for free he never could make it work because

perpetual motion is actually impossible so if the examiner can detect that there’s perpetual motion being claimed

in your invention he will reject it for not having utility um and then also like if you if if you made

a device the only purpose of which would be to like to destroy Humanity or something that would be claimed to have

disutility not utility so you couldn’t get a patent on that either I’d never had these problems in my practice making

lasers and things um the two big requirements are your invention has to be new or novel

uh which means no one’s done it before and it’s also got in the most difficult step in the final one it’s got to be

non-obvious in view of what was known before or or or you have to have what’s called an inventive step that’s what

they say in Europe now this one is arbitrary and so basically an examiner he finds one or two or more

prior art references which are not exactly on point if they were exactly on point then your invention wouldn’t be

new but it’s you can always usually change something like let’s say someone had invented I don’t know a red automobile

and I’ve just made a blue automobile well then my blue automobile would be new but it would still be obvious in

view of the fact that automobiles were known already because it would be obvious to just change the paint color

that’s how they argue anyway that last step is the one patent lawyers usually end up arguing with the patent office

most on um and there’s all kinds of legal standards which have evolved over the

years about the nuances of this uh and again as I said uh the patent

application process is done by a patent attorney or a patent agent usually patent attorneys

um what you do is you talk to the engineer usually an employee at a company and on the phone or in person

and and you try to have them explain to you his idea and you ask him questions and you then you write a draft of the

patent application like I showed you earlier and you file it um now one interesting thing about the

process is in most countries I know in the US but in most countries I believe you have to file in the country it’s

invented in first because most countries have these export licenses and all these things to control potential secrets and

all this kind of stuff so before I if I file a patent application

in the U.S I cannot file in any other country Canada Europe PCT I’m sorry not

BCT but uh um China whatever I can’t file in the other country until the US government gives me permission that’s called a

foreign filing license so when you file a patent in the U.S about

two or three months later you automatically usually get a letter back from the patent office saying your

foreign filing license is hereby granted like they kind of give it a cursory review make sure there’s no nuclear stuff in there or whatever and uh that

they want to claim for themselves and then then you have the right to file in the piece you know overseas in other

countries whatever alternatively you could file a foreign filing license first which I have never

done in my whole career and then you can file in another country first if you wanted to but you have to get the foreign filing license first

um and on occasion which again has never happened to me but theoretically instead of giving you the foreign filing license

after you file a U.S patent you might get a notice from the from some secret government agent some government agency

saying we detect National important secrets in here so we’re gonna give you

a secrecy order and we’re going to basically expropriate this patent from you they might pay you some kind of expropriation fee or something I don’t

know never had happen but the thing is they have a chance to take a first look at it and if you had a patent where um there

was something that like the NSA or the military thought they could use they might want to keep you from making it

public to the world because when you file your patent it’s not made public uh until 18 months later so there is still

secret until 18 months later roughly when it’s published okay

uh this is getting into the details but again you could file in the US you could use the PCT application to preserve

foreign filing rights or you can use the parish convention anyway and this process again as I mentioned is called patent prosecution

it usually takes I’ve had them I’ve had them take eight months to a year on rare occasions but usually two usually two to

three years is what it takes and sometimes way longer but usually two to three years so if you have 20-year term for the data filing patents usually last

18 to 17 years that’s roughly how it works um ever since the about 15 years ago

when the law was changed now once you have a patent and most

companies have patents because they get them because their employees have an obligation under default state

employment law or under their work or under the agreement that they sign when they when they join the company

basically anything an employee especially an engineer or a technical person

where part of their job is to come up with Technical Solutions to things um and to innovate basically when when

the when the employee comes up with the invention it’s automatically owned by the employer so most of your

work as a patent attorney is going to be representing companies who have employers I’m sorry employees usually

Engineers who come up with inventions and you file patents on them now the company might pay a bonus to the

inventor they don’t have to but they’ve you know give them one thousand dollars five thousand dollars as a bonus to

incentivize them to come up with these patents because they’re but they can be valuable to the company and usually companies strategically develop a patent

portfolio know why do they do this they do this for different reasons most of the time it’s not the in the the

independent inventor working out of his garage who makes into intermittent windshield wipers that makes millions of dollars you know usually it’s the

employee of a corporation right that’s what happens uh usually a large corporation

um because it’s expensive to file these patents and it’s very expensive to to assert them in litigation

um so one reason is defensive like you basically you want to cluster of patents

surrounding your technology to dissuade your competitors from pursuing you for infringing their

patents because you want to make them afraid to sue you because if someone sues me like if I’m competing with

another company I’m making I’m making cell phones they’re making cell phones um

I might accidentally or on purpose impringe some of their patents because patents are largely it’s almost

impossible to avoid infringing patents so if I’m making my cell phones even though I’m covered with a bunch of patents as I said earlier patents don’t

give you the right to do anything only to stop other people so just because I have 50 patents covering my cell phone technology doesn’t mean I have the right

to do it I might still be infringing someone else’s patents so I come out with my first product and all of a sudden I get sued by my competitor well

my competitor might be afraid to sue me if I have 50 patents because

if they’re also making cell phones they may be infringing one of my pens and I could counter sue them so one main

reason to have patents is defensive it’s like the porcupine approach like you don’t sue me and I won’t sue you of

course this leads to oligopolies and cartels because only the large companies can afford to have these big patent

portfolios so this makes the little guys afraid to enter The Fray because they can’t they can’t defend themselves with

their patents so they’re they’re at the mercy of all the big companies they have all the patents another reason is to

raise Capital like if you’re if you’re a startup and you want you have venture capital and you want to impress your investors they’re going to ask you do

you have a good patent program and you can say oh yeah we have 50 patents covering our product they’ll say okay

you’re protected another another way another reason to have these patents is to make money by licensing them this is

what patent trolls do by the way patent trolls just run around um they get patents they either buy them

from from bankrupt companies or they just have brainstorming sessions with a bunch of Engineers they file a bunch of patents they get a bunch of patents and

they just run around swing people as I mentioned on the slide on page 11

site 11 um you know they don’t really want to kill the people they’re suing they just want to wet their beaks like like a

mafia guy you know uh as as Pro IP objectivist law professor Adam also says

uh oh lawsuits like this or just an invitation to negotiation I’m serious about this you need to speak

to me like he says like it’s a good thing it’s a freaking Mafia type threat

um and and some some large companies do this too like IBM for years has made like I think uh since 96 to 2021 they

made 27 billion dollars licensing their huge Trove of patents to people of

course behind this license is the threat of lawsuit like if you don’t give me some money I’m going to sue you so it’s all extortion I think in recent years

it’s gone down from like a billion a year it’s like 600 million dollars a year they’ve been making in recent years so big money can be had by licensing the

patents uh and then again by Patent litigation or like patent trolls can do it and then I’m on slide 12 now

uh and patent trolls or are disparagingly referred to as non-practicing entities and everyone’s

critical of patent trolls just like well they’re not even making the product it’s like yeah but that means they don’t want to kill you they just want to taste

they’re just attacks if I if if I’m making smartphones and a patent troll comes after me they just want to take a

little cut of my profit so I can pay that just like I pay my taxes and I can keep practicing but if my competitor

sues me they want to kill me they want to stop me they don’t want me to compete with them they don’t want to cut they want to stop me so actually so-called

practicing entities are worse than patent trolls if all we had to worry about was patent trolls we would just

write patents off as a little drag on Innovation a cost it wouldn’t be the death knell that actual practicing

Humanities do so like you know uh some of you might remember

um Apple had a patent a design patent not even an utility pattern which is a patent an invention design patent just

the way something looks basically the ornamental aspects and patent had a apple had a patent on basically like a

flat touch screen device like an iPad or an iPhone with rounded corners

so they sued uh Motorola and then there was all these smartphone Wars about 10 15 years ago between Samsung and

Motorola and apple um and of course what they did was they had they they spent hundreds of millions

of dollars on patent patent attorneys doing the litigation um and then they finally settled with

each other with like cross licenses and someone agreed to pay a royalty to the other and all they did was they passed

the cost down to the consumers in the in the in the form of higher higher phone prices

and they basically end up forming a cartel like you have these major phone

companies which all had big patent tropes like Samsung and Motorola and Google and and apple and if you were a

startup company you wanted to make you know stuff and Costello’s new smartphone

I might have one or two patents but I’m going to be sued into Oblivion by all these big guys if I try to make a

smartphone because there’s no doubt they’re going to find some of their patents they’re going to say about I violate and even if I’m right

and I have to go to court it’s going to cost me literally millions of dollars to defend myself and if I win I just walk

away with a loss of money and the right to practice so this basically is a way

of dissuading small companies from getting into the business and that creates large companies so it creates

all the gobble even cartels all right I think I’m done with my lectures uh let

me turn this off then um probably have some questions remaining

so I will open the floor to any questions and although I said this is about IP law not policy uh you can ask

whatever you want because they all go together so uh everyone feel free to unmute yourself if you want to ask a

question uh are you familiar with the uh Wright Brothers being uh patent trolls

yeah vaguely I think uh Bulger and Levine cover some of that in their book against intellectual Monopoly and um

yeah of course A lot of these early Innovative Industries um were embroiled in litigation it

distracted them from their original focus and if I remember I don’t remember the facts exactly but um there were so

many lawsuits and there was so much uh damage to the to the fledgling Airline aviation industry in the U.S which you

know basically started here with the Wright brothers but uh that was the late 1800s so by the time World War one broke

out when Airline airplanes were starting to be useful for for Warfare um the entire

um uh American um uh aviation industry was like decimated

because of these stupid patent Wars so I believe the original airplanes had to be they had to go to France to get them or

something finally there was some kind of government-mediated settlement and then the U.S industry started up again but it

but this is an example of how patent battles can can delay technological innovation for uh for for a generation

uh there was there was a type of Television technology about 12 years ago

um uh I forgot the name of it it was like before OLED but if some kind of unique

it was after plasma and it was this unique really promising technology uh but there were so many patent Wars that

all the manufacturers just gave up they couldn’t make it because there was too many threats and they they moved on to

the next thing maybe the next thing would have been better but we’ll never know because they just didn’t they weren’t able to do it

yeah I was here like uh about the White Brothers invention and Kitty Hawk in the museum and we only hear about the plane

but you never hear about what they did with the rest of their lives afterwards and they just became patent trolls yeah

and Edison with the light bulb all these all these guys you know they tried to exploit the patent system again this is

why the patent system came under attack uh one one interesting thing was so in you know like I said it was sort of a

remnant of the statute of monopolies in 1623 and then the U.S kind of passed the

first major modern patent act in 1790 um and about you know 30 years later in

the mid-1800s all the free market economists started saying what the what what are we doing so they were really

pro-free trade and they they could they they made a clear argument that patent

rights impede free trade so all these countries started going yeah so there was like a strong movement

in the mid-1800s to abolish patent law and it was started it started working some countries abolish or patent law

others refused to implement it and it looked like it might have been on its way to being phased out because it

was just like a remnant of the protectionist mercantilist era of previous centuries but then what

happened was that around 1873 there was a major world recession and um

and when that happened everyone got really paranoid and they started being

hostile to free trade and so because everyone was hostile to free trade they stopped listening to The Economist

who said patents are a bad idea because they’re contrary to free trade and so this patent abolition movement just

collapsed and patents had their were able to survive and prosper and then

they got so entrenched because all the inventors like Edison and and and and and the Wright brothers these kind of

guys they’re like you can’t take away a patent system we need this to different you know so so it got entrenched and now

we have today’s situation where everyone uh everyone just assumes patents are a

natural part of of any private property system do you have a citation on uh that

historical movement the free market Economist in the 19th century yeah well probably the a good source on

that as um um there’s there’s kind of a quasi he’s either Austrian or quasi Austrian

there’s an economist called Fritz Matlab m-a-c-h-l-u-p um and in 1950 I believe he and Edith

Penrose it’s on my website c4sif.org um he and Edith Penrose wrote us wrote

an article about the 19th century patent law movement and and why it collapsed that’s a really good article I think

Mackle up summarizes it um later in a 1958 study he wrote for

congress on the patent system as a whole which is also on my website c4sif.org so look for Fritz math club and Edith

Penrose something called the 19th century pet movement or something like that

thank you Stephen that’s an awesome Source appreciate it

uh could somebody uh you mentioned like some some of these people had to go to France to kind of uh Escape uh the harsh

pattern regulations here in the 1800s and sometimes you go to China could uh

somebody make like a avoid all that uh build an oil rig uh

like structure out in the ocean international waters in the void infringing on anyone and build what they

want without being sued or prevented well probably they could build it out

there although you know there’s dangers of flying without a flag right and being

um being out in the open uh but the problem is that what you the patent right covers

making using selling or importing a product and so

if you made a bunch of knockoff iPhones on this oil rig in in international waters

what are you going to do with them if you want to sell them in any country like you sell them in the in the US you’d still be violating the US patents

because you’re selling them there are importing them there and and all the customers would be

violating the using part they’d be using it so it’d still be you’d still be covered I mean the only thing you could

do is make them so so let’s let’s say you’re at even apple is probably not going to patent the iPhone in every

country in the world it’s just too expensive all you need to do is patent it in the country’s the biggest markets

like Europe and say America or the or the countries where it’s likely to be made like say China because

if you have that covered you have the endpoints and the start points covered

now maybe you know maybe uh maybe Liechtenstein maybe you could make them

in Lichtenstein to sell them lichtensteinians because they’re not gonna have a pet in Liechtenstein but you know the Market’s too trivial

for that as I listen to Stein the uh patternless uh Paradise uh no it’s just that it’s a

small country and you probably like I said you wouldn’t you wouldn’t have a patent in 190 300 countries you’d have it in the top X countries so the small

countries would you would not have a patent in the small countries

anyone else do you have your own patents um I filed a couple on my own and I was

a co-inventor on a couple when you’re a patent attorney and you talk to the inventors usually you’re not a an

inventor but on occasion you come up with a suggestion when you’re brainstorming with them and if it’s if

it’s sufficient to make you a co-inventor of one of the claims then

you’re listed so I’m listed on on three or four patents what about patenting uh computer code

so so that’s interesting because so let’s say go back 40 years

uh software and computer code was not considered to be covered by copyright

or by patents okay but over time uh now

computer code can be patented and is copyrighted so it’s copyrighted because it’s considered to be

a writing a work of authorship um you know just if I write a novel it’s

patented I’m sorry it’s copyrighted if I if I write computer code it’s still something I wrote now some

people disagree with that because they say computer code is functional it’s not really expressive but then you know you

have your software autistic Savant say oh no it’s really an art man we’re expressing ourselves

there’s comments in the code so copyright covers it now but copyright

only covers the actual expression of it it doesn’t cover the functionality so if if if I if I copy if I have a copyright

in my code for um um a spreadsheet program or something

if someone gets that code and remember in the old days they wouldn’t release the code they would just release the executable they would keep the code

proprietary but you could theoretically reverse engineer the code the executable or you could maybe get a pirated copy of

the actual code and so now you know the functionality if you just write your own code from scratch that would not violate

the copyright however you can also because patents allow you

to they’re they’re I think there are four types of patents there’s utility patterns which is patent everyone thinks

of which is um which is the useful process

or apparatus there’s composition patterns which is like for pharmaceuticals and there’s also design

patents which is the ornamental way something looks like the iPhone rounded Corners thing and then there’s also plant patterns which is for asexually

reproduced plants and those are kind of special domains I don’t really do those and they have different terms but the

regular patent everyone thinks about as a design is a Utility Patent and again that covers a process and an apparatus

an apparatus is a machine or a device but a process is just a flow chart so it’s a way of doing things and that’s

what and that’s what software is software is a is a process so if you if you can take the code not in the 700

page or the 70 page detailed level but you can break it down into a flow chart with boxes and arrows

that gets to be more a functional thing and you can if you can describe that in a series of steps in a patent claim like

I claim um I claim a process for uh a process

for uh for detecting an image or a process for compressing data

comprising the following Steps step one um receiving inputs input data of an

image of a sequence of moving images step two um uh determining the difference between

frame one and frame two and step three instead of transmitting frame two

transmitting frame one and then the differences because the differences are smaller than the you know that’s what

image compression is right and so I’ve done patterns all this kind of stuff for Intel and other companies like that so

that would effectively cover the functionality of software code which means someone couldn’t even reverse

engineer and write it their own way because if they’re still doing the basically flow chart under a different language they’re still infringing the

patent but you have to apply for a patent copyrights are automatic which means they’re more problematic for

software for patent you have to apply for it uh and then people know what it is too like because it’s published

anyway and then you know if you write a program in JavaScript for example you’re using

a computer language that was made by another private organization and they

seem to uh permit people to use it to do what they want

but like it is something owned and controlled by some other organization you create your own program that does

something new I mean it seems like you could never disentangle who originated what you know um I I

think I’m and I specialize more in patents than in software and copyright uh my understanding is that well first

of all a lot of these things are open source so you just don’t have that problem because no one’s even trying to the open source the most that they try

to do is they try to say you can use our code to build your code but

we do have a copyright in our code but we’re going to let you use it and the only condition is we’re going to insist

that if you make a new um software incorporating some of our stuff which under copyright law might be

called a derivative work um then you have a copyright in that yourself but we’re going to insist that

you grant the same license to everyone else it’s called the I think it’s called the uh it’s like a copy left kind of

thing or in CC it’d be the CC sa share a like I think I think gnu does

that so they basically try to force you into using their model which is copy left

um but that’s not the same thing as using someone’s software engine to generate your code

so if if I licensed uh I don’t I’m not up to date on current how people do it

when I when I was in college I would use like Pascal or C plus plus okay so I go

to Turbo Pascal and I I buy this software and I can use their format to write a to write a program and to

generate an executable right um so I’m using their copyrighted or

they’re they’re copyrighted software to do something now theoretically they could have an end user license agreement

if they don’t have if they don’t have the license agreement then what I create is just mine mine alone the fact that I’m using their tools doesn’t make it

theirs you know so it’s like if I rent your your machine shop to make to make to make my my new gear

I own that gear and I own any patent in that gear just because I’m using their materials doesn’t mean anything uh but

if they had an agreement with me if they could they could basically say we’re only going to sell you this software if you sign on the dotted line and you

agree that anything you make with our with our tool we own part of I suppose that might be enforceable I’ve

never heard of that because that would be just too unpopular in the market um I think I would just go use a pirated

copy of Turbo Pascal or whatever instead of using theirs because I wouldn’t want the inventions I come up with to be

their property I don’t think that’s a problem but I could I could be wrong with someone who’s more of an expert in software would know but I don’t think

that the companies that make the software tools you use to generate your your thing unless it includes some of

their libraries and then they could say they could use this copy left things if you incorporate our libraries you have to give us credit or attribution or you

have to release yours under some kind of license but I don’t I don’t know in practice how restrictive they are mm-hmm

I think with software encoding is that it’s uh there’s always a next upgrade a new next update every week it’s always

uh changing uh I think it makes it impossible to try to NAB it and try to

patent it right away when the next week is just going to be a different version and that makes it the president want to

obsolete like uh like fashion I think it’s difficult to copyright fashion I

think be in the same room that’s correct and there’s an interesting thing so fashion

is not in perfect like perfume it’s all the smell is a perfume they’re not protected either

um uh so fashion designs are not protected by any kind of special right so that’s why you have these knockoffs

like you’ll have these high-end luxury Couture manufacturers Chanel and Dior

and all these they come up with these things they’re five thousand dollar dresses or whatever and then you’ll see a very similar thing the next season in

Walmart you know um so but but what what happens is like

because there’s no copyright or patent um on fashion designs you have

you have some of some of these high-end Brands they try to use trademark so this

is why for example you’ve probably seen like Chanel purses they have the big Chanel c on it

right the Double C thing or you Louis Vuitton they have that little Louis Vuitton little Clover symbol with LV all

of their luggage and their purses and the reason they do that is because if someone makes a knockoff of a Louis

Vuitton handbag they have to copy that design of their logo and that might be covered

by a trademark or even copyright so what they’ve done is they’ve they’ve basically embedded into their product

they’re trademarked logo and they forced consumers to think

that’s part of a fashion design of it it would be like you bought a Mercedes and like the entire Mercedes car

it was covered with thousands of little their little triangular circle logo thing like all over the car

like that was part of the essence of the cars that you had a thousand Mercedes logos painted on it so then if someone

wanted to make a knockoff Mercedes car they’d have to make it look like a Mercedes by having the Mercedes logo and

not violate the trademark so in a way this weird uh lack of and availability

of trademark law but lack of copyright law for fashion has distorted I I don’t I can’t I don’t know if we

would have had this this this phenomena of of purses and dresses and Handbags

and Luggage having the logos plastered all over them as part of the of the

design if it wasn’t for people trying what they could to use some type of IP law to protect themselves from

competition if there was no patented copyright and trademark law maybe this never would have happened we’d have a whole different fashion industry

what is your position on copy left well I don’t like it at all

um and I think if there was no copyright it would disappear because copyleft depends upon there being copyright

like copy left says I have a copyright in this and I only I’m I have the right to stop you from using my copyrighted uh

material I’m going to let you use it but only under these conditions so it’s a license and a license is permission but

people only need permission if they need permission they only need permission if someone has a copyright and they can stop you if

there was no copyright you wouldn’t need permission to copy people’s things so copy left would disappear I prefer cc0

or ccby attribution only or zero um I don’t see how ccby is is in a big

imposition because most people when they copy your novel or your painting

if they’re not going to be in legal trouble for doing it they don’t have a problem saying who the original author

was they don’t usually copy a novel and change the name of the author and pretend like they’re the

author because they would look like an idiot right so most people if you if you do a

bootleg copy of I don’t know the latest Avatar movie by James Cameron you’re not gonna pretend it wasn’t James Cameron so

the CC by condition is not an imposition because everyone’s going no one has a problem with attribution giving

attribution if if doing so doesn’t make them liable um but CC CCB CC left copyright under CC

it’s called Cheryl like and copyleft is what you’re talking about that version of it I don’t like it because it’s an

attempt to use my little activist thing and to leverage my copyrights to force

you to do it my way um I prefer to open it up just make it open source

so for example if I published if I published a novel and I released the cc0

that means anyone in the world is free to reprint it even with their name on it or

they can make a movie based on it now let’s let’s say I publish a novel and someone makes a movie based on it

they would actually have a copyright in that movie because it’s a derivative work but I don’t have any rights in it because I’ve disclaimed my copyright in

my book so they would have a pure brand new copyright in their movie and they could they could use copyright against

people which I don’t like but I don’t think it’s mine against your book as well no

not against my book but but against because my book is not a derivative work of their novel it’s the other way around

I mean other movie their movies that drove to work with my book but they could they could stop you from copying the novel the movie sorry like even if I

copied the movie I’d be in trouble because it’s a unique new work on its own it’s a derivative work but if I use copy left then they they

would only be able to have the right to make this movie if they also released it under copy left which means they

couldn’t sue people and I can understand the motivation to do that it’s sort of an activist thing

it’s trying to use your copyright to force other people to be libertarian I prefer to just open it up and make it

non-copyright that’s my preference okay thanks

so what what do you think about like just

breaking those uh licenses like creating good Dark Net website with uh software

which uh or movies or whatever just

breaking it and doing it illegally well I don’t know if it’s it’s prudent

or wise in every case because there are severe criminal copyright penalties um you I mean people can actually go to

prison for this kind of stuff um unfortunately it’s Darkness like without

any Trace like without um anyway to government to trace who did it

yeah no I I’m I mean I’m all in favor of that I think copyright law is totally evil and so is patent law and I think

evading it is perfectly perfectly moral and a good thing to do if you can get away with it I don’t know

if it’s always risk it worth the risk um um but I think that’s a good thing in fact I think this is this is part of the

problem with copyright is that um it can be evaded by as you say with

the dark net or with encryption or with um torrenting and things like that in a sense the internet

is the biggest threat to digi the digitalization of information and the

internet of streaming torrenting encryption is a huge threat to copyright because

basically it’s it’s it has become now impossible to stop what they call piracy which is which is a misnomer but it’s

it’s impossible to stop piracy um uh and this is why

governments keep trying to pass laws that effectively restrict internet freedom

which is why I think copyright is in a way the most um

well I have a debate about whether copyright or patent law is more harmful I think patent law is more harmful

then copyright in that patents to slow down the pace of new innovation and this is how the human race became as wealthy

as it as it is by the accumulation of technological knowledge and if you slow it down you’re slowing down the

advancement of the human race on the other hand copyright law lasts a lot longer and it heavily distorts

culture and it’s also a threat to internet freedom because the copyright interests know that the internet is a

big threat to their copyright enforcement regime so they keep trying to uh

to like get rid of the DMC uh the the the the the the the the Safe Harbor and

the dmca do they hate that you know they want to be able to sue like YouTube and

Google and blogs and platforms for hosting infringing content instead of

having to go after the guy that did it um and issue a takedown notice and all this kind of stuff they hate this stuff

um and but of course the internet would probably disappear if copyright was enforced um the way it was intended to

uh so that’s one of the problems with copyright it’s a threat to internet freedom and internet the internet is

essential to finding the state um you know I’m afraid that this new AI that’s coming out

could be killed by copyright because you already have people calling Barry Diller and other people calling for

um saying that you know when you have these AI engines like Chad gbt and the other one that does the art or whatever they basically mine the internet for

images and and for data right to train on and to build on and then they generate a new output so it’s basically

a black box that transforms information online into an output now

from a copyright point of view most of that information they’re downloading is is probably protected by copyright

and then what they’re generating is would be a derivative work and that’s technically a copyright

infringement and since there’s these AIS do so many trillions of operations internally and they operate so much

faster than us um like there’s one study by a law professor named John Torani and about 12

years ago and he estimated that like everyone everyone here on this call everyone that’s a normal

modern internet user theoretically is is liable for about 4.5 billion dollars a

year in Damages for copyright infringement just from copying things on the internet sending someone an email here and there that kind of stuff now

imagine chat gbt so take the 4.5 billion and that was 12

years ago so let’s say 6 billion now take the 6 billion we’re all liable for every year which is preposterous but

that’s the way copyright law Works um and multiply that times I don’t know a billion or a trillion all the

operations these these these AIS use so like you know every AI is liable for

quintillion dollars a year in Damages which is a thousand times more than the entire planet Earth is worth it’s like

insane right it’s this is how this is what you get it’s it’s like the legal equivalent of dividing by zero like in

math if you divide by zero you get you get uh impossible irrational results

and in law when you try to protect intangible things with physical Force which is a tangible thing you’re

dividing by zero and you get insane like this but they can find

combine it with censorship so it’s kind of working like violation uh

intellectual property but also in in the way that it’s not

good for people it’s good for corporations well sure that that gets that gets us to

you know the topic of AI itself and whether in its current form it could be useful as it’s kind of quasi-controlled

by the state I I mean I I’m personally not I’m a skeptic of AI and it’s utility

but I think it’s going to keep developing and eventually it might turn into something kind of useful but the

point is to the extent it could have a use someday assuming the government doesn’t uh corrupt it too much

um uh copyright law could be an impediment and slow it down

that’s all I’m saying so you haven’t used uh gbt with your uh

uh lawyering and attorney work assistant well I’m basically I’m basically retired

so I don’t need to but I I could see how it could be useful like it enhanced um an enhanced Google search on occasion

and I’ve seen like David vexer my friend he’s he’s getting good at using it to I

don’t know generate tables of like when to water your plants and things like that but I the thing is you can’t

trust it and it doesn’t have any intentionality and it’s not uh conscious

um and it’s also hobbled of course by you know you can’t use it for nudes or porn and and you

can’t use it for things that they think is racist so it’s like the whole thing is like already gimped and hobbled and

uh uh we’ll see what happens with it but I I I I don’t I don’t I don’t see I I

don’t I don’t see it’s really gonna put white color workers out of business anytime soon

you mentioned there’s uh criminal penalties for copyright violation um are there similar penalties for

patent violation or how is that enforced uh I don’t think so um

I don’t think so there’s there’s something called uh enhanced damages for what’s called willful infringement so

let’s say I infring someone’s patent and they can prove that I’ve damaged them

I’ve damaged them because they weren’t able to sell their as many things at a Monopoly price as they could have with

being able to to stop competition so let’s say I damage them to the tune of five million dollars

um if I was aware of their patent and I did it anyway like instead of like unknowingly I did

it willfully which is one reason you will have companies send a letter to you and they

say we think you’re you’re violating our patent it’s patent number X here it is we we insist that you stop now they have

a record showing that you were from that day forward at least you were aware of the patent and you were willfully infringing it so then the

damages can be troubled triple tripled um but I’m not aware of any criminal

penalties for copy for patent infringement now for trade secret trade secret is largely a state thing but

there is a federal criminal trade secret thing which I

think also has criminal penalties but yeah copyright is serious because um if you guys remember this this guy named

Aaron Schwartz who was the guy that helped invent RSS and he was brilliant young coder and you

know he stuck into some server room at Columbia or one of the universities and he he he downloaded all their academic

articles they had from one of these databases and he used his laptop and used their Broadband to upload like

thousands of these you know like the law review articles or like academic papers he uploaded them to the internet like

big deal and he and he got caught he was facing like 20 years to life in federal prison

her just uploading academic articles to the internet and so he he committed suicide he killed himself because he

couldn’t handle it there was a guy I remember I mean there’s lots of stories but uh maybe 15 years ago remember the

Wolverine movie um some guy uploaded one copy of Wolverine to the internet he went to

federal prison for for one year there was a there was a rich there was a a a UK grad student and I think Richard o

Dwyer um and he had a website and on his website he had links he didn’t he didn’t

have pirated content but he had links to like servers in Russia or China or somewhere to which which themselves

hosted pirated copies of of Hollywood movies and things like this and the US tried to extradite this guy to the U.S

from Britain to face Federal criminal charges in jail and like his whole grad

student career was disrupted for three years I mean he was fearing being sent from Britain to America to go to Federal

prison for having a website that had hyperlinks on it that’s all

he finally won or he finally got it to be dropped but his his life was like made a nightmare for five years or

something it was crazy so it’s a real threat it’s serious so when it’s domestic only how could

they argue that a Brits that’s never been to America broke a American federal

law I I don’t know the details I assumed they were arguing he was violating British copyright law because okay

because there’s a the burn convention basically which all the all the

countries of the world are almost every country that I’m aware of as part of the burn convention which requires every

every country that’s a member to have a copyright law with certain minimum standards

in fact the U.S didn’t join that until 1988 because we didn’t like the um the

moral rights aspects of it so I think we got an exception for that but it but the burn convention

the U.S has strong copyright law internally but we we for a long time you

could pirate foreign works I think Charles Dickens hate it was pissed off about that like you could buy pirated

copies of Great Expectations and so so he wasn’t making as much money as he could in the U.S so he he went on tour

here doing speeches to make some money from his loving audience and then he he uh

this is one of the stupid defenses of Ip uh I think I can’t remember who made

this argument I’ve got it on my website somewhere but someone said you know Charles Dickens had to come to America and tour to make money off speeches and

then he got pneumonia and died so basically the lack of copyright killed Charles Dickens

it’s crazy so I suspect that Dwyer was um in violation of um of the British

version of copyright law and probably under some treaty he could be hauled into court in the U.S because the

victims were American or something like that right yeah thank you

would you say that uh the patent regime in the U.S is getting worse right now in

what ways is it getting worse and no no I don’t think it’s getting worse I think my guess is copyright and

patent have both reached their limit like I I doubt there’s going to be any more extension of patent copyright terms

because it’s just so ridiculous it’s life of the author plus 70 years now in the US and I’m sure they’re going to try

to add another 20 years on to it like they did 20 years ago um but I don’t think they’re going to

get that now the one thing is I do think copyright law will keep getting worse because they’re going to gradually keep

adding these um these um these things about um uh like they might shrink the section

230 and the and the dmca Safe Harbor back a little bit uh or they might

enhance the penalties uh so but they’re going to go after enforcement and that that would be an

increased threat to to the internet um ask for patent if you talk to patent attorneys and patent

people that are in favor of the system they will say that the patent system has gradually been undermined and

gotten weaker in the last two decades three decades and to a degree they have

a little bit of a point not in terms of the law uh the law is irrelevant the statute was

changed under Obama but it it was changed in in in in in in

Trivial ways from the point of view of the average victim of like for example we went from a first to file system I’m

sorry we went from a first to event system to a first to file system primarily

because basically every other country on the Earth has the first to file system we want we want it to be like them but

so all that means is in some cases inventor a will win the battle instead of inventor B but from the point of view

of the industry it doesn’t matter whether inventor A or B owns it because it’s the the threat to Innovation is

still still the same thing I don’t I mean if I’m going to be shaken down or extorted by someone it I’m not going to

be upset that it was inventor b instead of inventor a oh I wish it was I wish it was the guy that was the first to invent

so the first file that’s so we made for a billion dollars it doesn’t matter um there have been some Court decisions

which have um into my mind they’re all roughly favorable because they slightly reduce

the the Damage Done by the patent system so one example was a case I don’t know

several years back um where it made it a little bit harder to get an injunction to enforce a patent

so before this decision I think it was about seven eight nine years ago maybe

it’s called list I can’t remember but um before then if you if you won your

patent infringement lawsuit against someone you pretty much had an automatic right to get the court to issue an

injunction where the court says You must stop selling this product

um it was like automatic it was just given like as a as a result of winning but I think this court case basically

said no you don’t get injunctions automatically you have to satisfy a three-part test

and you can’t always satisfy that so like basically damages monetary damages or in many cases enough to satisfy you

so you could just ask for money from your victim instead of an injunction uh and and so some of the proponents of IPA

as a copyright I’m sorry patented as a property right they think that that undermines its state its status as a

property right because you can you know if you own a house you don’t just get damages of someone squatting in it you get to kick them out right so they think

that if you actually have a property right in an invention you should be able to get an injunction as a matter of course but now it’s harder so but it

should be harder because injunctions are horrible and uh and there’s a couple other things

like you know maybe uh some abstract ideas are not going to

be subject to patents that would have been but it’s roughly the same as it used to be I don’t think I don’t think patents will get any worse or any better

they’re not doing anything like increasing patent terms yes or anything like that okay no no

is there a fair use equivalent in patent law something like that no

there’s something in patent law called the doctrine of equivalence and the doctrine of equivalence says

that um when you have a patent the patent right is what’s defined in

the claims let’s say claim one and it’s defined by what they call the limitations of the claim or the elements of the claim so let’s say you have a

claim with say four elements a b c and d that means that any competing device

that has that has elements a b c and d will be infringing okay

um what most people have a hard time understanding is so if you have a competing device that has Element e

it’s still infringing because it has it has elements a b c and d That’s why a chair

would infringe a patent on the stool because a chair is a stool a chair is a special type of stool

because the chair still has a seat and legs and that’s all the pad so the patents patents have the word comprising

which means it includes it doesn’t mean consists only of if you had a patent

claim that said I I claim a sitting device

consisting exactly of um a seat and three legs well then if

you had a stool that had four legs it wouldn’t be infringing or if you had a seat a stool with a with a back it wouldn’t be imprinted because it

wouldn’t be exactly only a seat and legs but that’s why patent lawyers don’t claim it as consisting they say comprising includes

right so it just means the competing device just has to have that bare set of elements even if it has other things now

under the doctrine of equivalence let’s suppose let’s suppose I had a patent on

something and it was let’s say I had a stool and I said different types

let’s say I had a a patent um on a um on a stool and I said I claim a sitting

device having a seat and three legs nailed to the

to the seat and someone else says oh okay well I’m just going to use a screw instead of a

nail to get around the patent because the patent says Nails it doesn’t say screw

well then under the doctrine of equivalence the court might say well in this case the screw is a functional

equivalent of the nail and so so like my my patent has elements a b c

and d and the competing device has elements a b c and d Prime

well if D Prime is effectively the equivalent of D then it still might be infringing so if anything is the other

way around um

right yeah thank you

anyone else anything at all anything about IP law

policy practice so in practice how many new patents do

you get like are they issued every week on a Monday or uh how often do you have

to read the news to know if you’re impacted or not well that’s what that’s part of the the

problem with this you know you know how like in the law we say that ignorance of law is no excuse which

makes sense if law is natural law because everyone you know the idea is that natural law is engraving on your

heart everyone you can’t say oh I raped this girl but I didn’t know I wasn’t supposed to rape her like you can’t

claim ignorance of the law if it’s natural law or murder whatever you know but if it’s arbitrary law thousands of

statues and no one no one even know what’s happening no one knows what the law is and no one knows how many laws

there are like no one even knows this right maybe maybe chat GPT can figure out someday but I mean it’s it’s I think

when law is made artificially by Statute it actually ignorance of the law should be an excuse in my opinion but but

unfortunately it’s not um same thing with the patent system it’s impossible to keep up with it uh patents are issued

if I recall every Tuesday once a week they’re issued um but no no one keeps true in fact like

I said earlier if you’re aware of a patent then you might be guilty of willful damages or treble damages so there’s

also there’s almost an incentive to keep your head in the sand and not to not investigate the patents out there

because if you’re making a new device you kind of don’t want to know if it’s covered by a patent because

that’s only going to make you potentially liable for more damages down the road so yeah you don’t keep now if

you if you want to go into a certain area you can pay someone to do a patent search in a given area and there are

hundreds of subcategories in the patent office the way that patents are done but of course it’s impossible to

scientifically do this right um because it’s arbitrary categories

yeah insane thank you

I want to thank uh your time for putting this together I think uh this completes

finally my mises Institute uh curriculum I think I missed you at uh 2016. uh in

Ashburn Alabama uh but you did write a sign that book for me uh against intellectual property so appreciate that

very much this course that you provide well so my plan is uh I think I’ll go

and close now um but I think my plan is um maybe if everyone thinks is a good

idea I welcome maybe in the email we wrote earlier you can write me back and let give me your thoughts on this um I’d

maybe do another one of these next week or something like that on copyright and then if there’s room for another one or

anything else we could do that too but uh that but at least it would be good to have like um one good recorded thing

like this on the kind of nuts and bolts of how the system works um so that people

like understand these laws that I’ve been railing against for so long and that we’re talking about the policy uh

aspects of so I guess I’ll let everybody unless there’s any final question I’ll let every any final comments or questions

I just think that the copyright one is going to need a lot longer q a uh that’s fine all right I could even do

like you know I can start the Q a and then if it we need another one I’ll do a a second q a to extend it so that’s not

a problem well thank you very much I really appreciate it this was fantastic thank you thanks everybody have a good uh have

a good day was a very good meeting thanks