Yesterday we
mentioned a little-noticed story from last week - overshadowed by the State of the Union, the iPad launch, and here in DC, the
State of the Net - in which Google was exonerated by a jury in Marshall, Texas from allegations of patent infringement.
Worthy of further note is that at the end of the two-and-a-half-year case, the patent holder’s lawyer
argued:
“If someone drills oil on your property, they are responsible for
paying royalties whether they knew it was your property at the time or
not.”
This is wrong, and most IP lawyers know it. “Intellectual property” is
very much unlike real property. True, the word ‘property’ is in the
name, but if you think that makes IP property, first consider whether
the PATRIOT Act regulates patriotism.
Many reasons why IP isn’t property are ably recounted by noted lawyer and law professor Mark Lemley
here. This is also why, incidentally, the Supreme Court
held
that infringement isn’t the same as “theft.” Nevertheless, when
talking to non-lawyers – particularly when representing a plaintiff, IP
lawyers don’t always shoot straight about this. The urge to mislead
the public with the property metaphor is overwhelming. Protecting
“property” is good. People worry about government taking property.
(Nevermind that patents are handed out by the government in the first
place.) The word pushes emotional buttons. The problem with the
“property” metaphor is that it breaks down faster than a thin-skinned
American Idol contestant.
Take the oil-drilling example here. The boundaries of real property
tend to be self-evident. Someone lives on it. Or perhaps there’s a
fence. And even if there isn’t, the state knows who owns what in case
they may want to tax land or regulate nuisances. Someone knows who
owns what. So you can go down to the county assessor and ask, “who
owns that land?” Try that at the PTO and they might laugh at you.
In patent law, no one knows for certain who owns what. Not even the
PTO. Unlike the boundaries of real property, which can be surveyed for
a reasonable cost, you can’t see the boundaries of intellectual
property, and the best you can get in the way of a survey is an opinion
letter from your lawyer. That could run upwards of $25K per patent,
and there are good odds your lawyer might turn out to be wrong. And
since – at least in technology markets – we’re talking about dozens or
even hundreds of patents at a time, the cost of the survey will often
be greater than the value of the property itself.
If someone abandons real property, the state will eventually claim it.
If patents sit undeveloped for years, however, functionally abandoned
by their rightsholder, nothing happens. Innovation stalls until the
patents expire.
Real property doesn’t lend itself to ambush, either. You would never
see hundreds of people traveling down a freeway, only to find that
someone has erected a toll at the last off-ramp, and is charging
everyone extortionate tolls to get off. But this happens with
troubling frequency in patent law, such when industries adopt an open
standard, and then some enterprising outfit comes along and secretly
patents the standard. Once you’ve invested in redesigning your
product, retooled your factory, and retrained your engineers, not
paying the toll may not be an option.
Merely because we call patents and copyrights by the name ‘intellectual
property’ doesn’t magically transform them into property, any more than
the term “IP” makes the latest chart-topping pop music hit
‘intellectual.’
It is easy to forget this, however, when doing so might help you win a $600 million dollar judgment.
