Patents are enshrined in the U.S. Constitution as a means to “promote the progress of science and useful arts.” Yet, in recent years, abusive and rent-seeking patent litigation has done just the opposite. In 2011, lawsuits brought by “non-practicing entities” – commonly known as “patent trolls” – led to$29 billion in direct costs, and $80 billion in lost wealth for publicly traded companies.
In an effort to address this growing problem, Reps. Darrell Issa, R-Calif., and Judy Chu, D-Calif., this week introduced legislation called the Stopping the Offensive Use of Patents Act (or STOP Act) – a companion bill to the Senate’s Patent Quality Improvement Act, sponsored by Sen. Chuck Schumer, D-N.Y. – that looks to streamline how patent infringement disputes are resolved and drastically reduce how much the process costs.
Patent trolls are individuals or firms that own patents but do not produce goods or services. Instead, they assert their patent rights against companies whose products they claim infringe on one or more patents. Colleen Chien of Santa Clara University Law School notes that in 2012, 62% of all patent litigation was brought by patent trolls, up from 19% in 2006. Moreover, the targets are disproportionately small and medium-sized businesses who have limited resources to fight back.
You’d think Congress would learn its lesson. After much of the nation revolted in protest this year, the Stop Online Piracy Act (SOPA) was killed in the House, as was its counterpart (PIPA) in the Senate. Americans don’t want government regulating and policing the Internet. Beyond that, the bill was bad for technology.
SOPA got pulled. We won. We sent a clear message that Congress should keep its grubby paws off the Internet. Victory is sweet!
But now it’s happening again.
Lamar Smith, the stubborn Republican from Texas is pushing his Intellectual Property (IP) legislation back into the forefront, and it seems that his latest effort, the Intellectual Property Attache Act, is on the fast track to be rushed through Congress before the public really understand what’s going on.
TechDirt reported yesterday about how the IP attaches that would be created would be for pushing maximalist policy globally:
Their role is not to support more effective or more reasonable IP policy. It is solely to increase expansion, and basically act as Hollywood’s personal thugs pressuring other countries to do the will of the major studios and labels. The role is literally defined as pushing for “aggressive support for enforcement action” throughout the world.
A few weeks ago, I wrote a post about what was wrong with the libertarian movement today, the mistakes and missteps we’ve perpetuated. I’ve been working on continuing the series, but there are several issues that are all complex. My initial post was more about the PR angle of it; the next three deal with actual philosophy. The three major problems that I see—and will explore in individual posts—is the current debate over intellectual property rights, the preoccupation with Rothbardian/Rockwellian anarcho-capitalism, and what I see as indequate foreign policy positions. All three of which, I think, make libertarianism look immature and unserious, and threaten its viability with the American public.
In this post, I’ll look into intellectual property rights; also, take a look at my first post, as well as read Tom Knighton’s excellent post on being more inclusive to moderate libertarians, and even letting them run the movement. But first, let’s look at IPR.
Many libertarians—not all, but many—are part of the anti-intellectual property movement. They argue that copyright is wrong, that one cannot have property rights in a mere idea, and that filesharing and data piracy should be completely legit and permissible. The main foundation for this position is that digital goods and intellectual goods cannot be scarce, thus you can’t have property in them. Stephen Kinsella, furthermore, argues over at Mises that this is theft—intellectual property rights would give A control over B’s property, by telling B not to use his or her property in certain ways.
All of this is balderdash.
Yesterday, I spoke on the floor of the House of Representatives about the massive online protest against the Stop Online Piracy Act (“SOPA”) and the PROTECT IP Act (“PIPA”), legislation that poses a dire threat to the Internet and to liberties that our enshrined in our Bill of Rights.
You can watch my speech and read the transcript below:
Long ago, Jefferson warned, “The natural progress of things is for liberty to yield, and government to gain ground.” The exceptions to that rule have been few and far between recently, and ought to be celebrated when they occur.
One did this past week with the announcement that supporters of the so-called “Stop On-Line Privacy Act” and the “Protect Intellectual Property Act” have indefinitely postponed their measures after an unprecedented protest across the Internet.
SOPA and PIPA pose a crippling danger to the Internet because they use the legitimate concern over copy-right infringement as an excuse for government to intrude upon and regulate the very essence of the Internet - the unrestricted and absolutely free association that links site to site, providing infinite pathways for commerce, discourse and learning.
In one of the few instances of “good news,” or at least “not that terrible news,” the Stop Online Piracy Act has been delayed until after the winter recess:
WASHINGTON POST - The House Judiciary Committee confirmed Tuesday that it will delay continuing debate on the Stop Online Piracy Act until after Congress returns from its winter recess.
Committee spokeswoman Kim Smith said in an e-mailed statement that the hearing is expected to be scheduled for “early next year.”
Well, that is certainly good news on one front. It at least means they won’t be shoving it down our throat today.
But they’re going to try again. It always happens.
There was widespread outrage when TARP was first proposed, and under that public onslaught, the House of Representatives bucked its campaign contributors and shot the plan down. There was much rejoicing—until they passed it, with even more pork, four days later.
Now, I’m not saying this is necessarily what will happen with SOPA. It may come back and it may be defeated. That is certainly a possibility. But it will come back. The Recording Industry Association of America and the Motion Picture Association of America—which I have heard sarcastically referred to, combined, as the MAFIAA—have far too much invested in controlling your Internet access and your personal computer. Do you think they’re just going to give up the possibility of more control over your lives? Of course not. No corporation that could obtain such lucrative rents from the government is going to give it up that easily.
I’ve been following the progress of the “Stop Online Piracy Act,” or SOPA, also known as the “Internet Blacklist Bill,” for some time now, but haven’t posted about it because I feel that other websites cover it far better. Recently, though, I’ve seen some news I feel I have to share to United Liberty readers, because it comes straight from the “Holy Crap I Never Saw THAT Coming!” department.
For a good summary of why SOPA is a bad law, you should read the Electronic Frontier Foundation’s explanation. You can also grab the actual text of the law here. In effect, the bill would criminalize “casual piracy”—linking a music video on Facebook would land you some stiff penalties, as well as penalties for Facebook. Goodbye Youtube, as well. For that reason, Facebook, Twitter, Tumblr, Youtube, Google, and a host of other Internet giants have come out against the bill, in addition to groups like EFF, DemandProgress, CreativeCommons, and Mozilla.
Those of us who are proponents of free trade have heard Mitt Romney’s frequent jabs at China, the United States largest trading partner. While President Barack Obama hasn’t been consistent on free trade — his administration has gone after China on tires, steel, and cars — he has signed three new trade agreements into law.
Despite his reputation as a proponent of free trade, Romney has been harsh toward China in this cycle, promising to label them as a currency manipulator and impose sanctions for violating intellectual property rights. It’s hard to believe that Romney actually believes this would be good for the economy and he’s just pandering to populists, hoping to earn votes.
But over at Reason, Shikha Dalmia explains that the policies toward China pushed by Romney on the campaign trail and in debates are misguided and could hurt the American economy, rather than protect jobs:
Romney even suggested—rightly—that the power in the China-U.S. relationship was on America’s side. Hence, retaliation against China wouldn’t trigger a trade war, because that would hurt China’s trade-dependent economy far more than America’s domestic-oriented one.
With the passage of the Cyber Intelligence Sharing and Protection Act (CISPA) in the House last week, many of us are still trying to determine the impact of the bill on the Internet and how it will affect users.
There is no easy answer to the question, after all, this is a complex issue in a time when hacking and other cyber crimes are becoming more prominent. But those of us that helped kill the Stop Online Piracy Act (SOPA) because of concerns over censorship, CISPA may indeed be much worse because it essentially ignores Fourth Amendment protections:
According to the bill’s main author, Rep. Mike Rogers (R-Mich.), CISPA’s main purpose is to allow companies and the government to share information to prevent and defend against cyberattacks. But the bill’s language is written so broadly that it carves out a giant cybersecurity loophole in all existing privacy laws.
The problem is in the bill’s definition of “cyber threat information” and how companies can respond to it. “Cyber threat information” is an overly vague term that can be interpreted to include a wide range of tasks that normally wouldn’t be considered cyberthreats — like encrypting emails or running an anonymization tool such as Tor — and as a result, a company’s options would be so numerous as to allow it to read any user’s communications for a host of reasons.
Netflix fascinates me. How a company that has done such a great job of delivering a quality product to customers in an array of methods can get into so much trouble with its customer base is mind boggling.
Remember last year when Netflix raised prices and infuriated their customer base? Customers got furious. Then Netflix announced that DVD rentals would be going to a new service Qwikster. Separate web site, separate queues, separate credit card charges, incredibly stupid name…yeah, that sounds like a good idea. So Netflix announced Quikster. Then after customers responded in ways that could only be described as blowback, it backed off of the idea in a poorly written blog post from Reed Hastings, the Netflix CEO.
Somehow after demonstrating amazing levels of stupidity time after time, Netflix has managed to keep customers. Sure, it lost some customers in the midst of that price change chaos, but the company is still doing just fine. This is probably because despite a history of poor decisions, the company really does deliver a quality product. So these poor decisions don’t really have too much of an impact on revenue.
But you can only go to that well so many times before it runs dry.
This week it was announced that Netflix had formed a political action committee (PAC). Immediately people all over the Internet were (rightfully) concerned that this company that supported that horrid SOPA/PIPA legislation was going to be pushing for its passage again.
Over at TechLiberation, Mercatus Center senior research fellow (and all around cool dude) Jerry Brito writes that we should be working a bit harder on copyright, and perhaps putting forth our own suggestions towards the problem, in order to avoid a repeat of SOPA:
Kevin Drum and Tim Lee have been having an interesting exchange about whether those of us who oppose granting copyright holders stronger enforcement powers feel this way because we are ideologically opposed to IP protection. Tim points out that copyright owners have, as a matter of fact, received greater and greater enforcement powers–almost on an annual basis. As a result, Tim says, “most of us are not anti-copyright; we just think enough is enough, and that the menu of enforcement tools Congress has already given to copyright holders is more than sufficient.”
Sufficient for what, though? Sufficient to significantly reduce piracy online? That’s certainly not the case. Piracy is rampant on the net. Some would say, though, that the only meaningful ways left to enforce copyright would (dare I say it?) break the Internet as we know it.
It’s a hard problem, and there are no easy answers. But if we do believe in copyright, then I think the intellectually honest thing to do is to spend some time thinking about how to reduce piracy, on the margin, without breaking the Internet. We can do this at the same time we fight for greater recognition of fair use, to protect the public domain, and to roll back terms and other over-reaching in copyright.